By Kevin M

If you’re at all like me, you love Christmas, but you could do without the stress and expense of all that holiday shopping. A full years worth of shopping and buying is condensed into a single short 4-5 week space of time that leaves you worn out and nearly broke by the time it’s over. (Are we having fun yet???)

Here are some tips I’ve learned over the years that will save money, time and stress, freeing you up to actually enjoy the season…

Amazon.com and other online retailers

Among a long laundry list of gifts this year, my wife wants the first and second season collections of the TV show Vampire Diaries. We checked them out at Target–$54(!)—but a quick check on Amazon.com shows we can get them for only $12.99, or less than a quarter of the price! I’m not saying we should buy everything online, but we should certainly set a price threshold above which checking out online alternatives becomes routine. The savings can be substantial.

But there’s even more benefit to shopping online: it saves us the time (driving, parking, standing in line) and expenses (gas and a meal on the fly) that are typical when we head out to the mall. If I can save money, and do it from the comfort of my own home, then it’s a no-brainer. Just make sure that you do it in time to allow for delivery; December 24th will be too late!

Shop off-peak

I have a confession. This Thanksgiving—or as it will undoubtedly soon be known, Black Friday Eve—at about 10:30 pm, I took my kids to Walmart to see if we could take advantage of some of their door buster sales. A conscientious objector, my wife stayed home. I wish I had.

Walmart was offering 15 inch HP laptop computers, regularly $388, for $248. Great deal right? That’s what the other 2-3,000 patrons at the store thought too. The operative jargon in their ad flyers was “while supplies last”. Maybe they had 100 of them, maybe they had ten, but however many they had, they were sold out well before midnight when the cash registers officially opened for business.

As a consolation, we ended up buying a printer/scanner for $19 that regularly sells for $58, but somehow that didn’t make the experience any better. We spent about 20 minutes circling the parking lot looking for an available parking space, and then another 10 minutes walking to the store once we found one. Inside the lines had already swamped the cash registers, advertised specials had been cleaned out, and merchandise was strewn all over the floors. We didn’t get out with our “deal” until 1 am.

Some way to spend Thanksgiving night, huh? But it wasn’t as bad for us as for the “winners” in the discount laptop competition—many of them found that the laptops they’d taken were nearly identical in every detail except for one thing: the price! The B version was more then $100 higher. Two hours in line only to find out that they didn’t have the deal they had come in for.

But it wasn’t a total loss, after all the store had record sales that night!

And that’s the whole point. What’s good for the store is usually bad for the customer. Black Friday, weekend specials and other manufactured urgency events are no place for a frugal customer. This season, try to do the bulk of your shopping on early weeknights. Monday and Tuesday are best, but the closer you get to the weekend, the bigger the crowds and the more chaos, neither of which are conducive to a pleasant shopping experience.

I find that by shopping early in the week I experience…

1. Smaller crowds, which means more parking, shorter lines and less stress
2. Because of the above, you’ll be in a better position to take advantage of sales and specials
3. Less likelihood of the empty shelf syndrome that heavy shopping days produce
4. By getting shopping done early in the week, theres less pressure as you move toward the end of the week
5. More free time on weekends for watching Christmas specials and visiting with family and friends and actually enjoying the holiday season!

Check websites for specials and coupons before shopping

With all of the activity that the Christmas season brings, a few things have to go just to make it all doable. For me, that means the mail gets little more than a cursory review, and anything that requires any detailed reading is filed on the “Later Stack”— as in later after the holidays. (When I was in the mortgage business and we’d get people’s credit explanation letters, the volume and slow pace of the mail at Christmas was close to the #1 reason for late bill payments!)

Let’s face it, there’s more junk mail at Christmas than at any other time of the year. Passing it over may save time, but it can also cost money. There are usually valuable specials and coupons in those piles of what we like to call junk mail. But there’s a way around this, even if you don’t have time to sift through the waves of mail that hit during this time of year. Before you go shopping, check out the websites of any stores you plan to hit. They’ll have printable coupons—the same ones that come by mail—and sometimes a special offer or two that won’t be in their printed ads. And with the one day sales most stores offer, checking websites will be the very best way to stay on top of who’s doing it and when.

We shop at JC Penney a good bit and while you can save a lot of money doing so, their coupons and specials tend to be a bit of a matrix. Last night we went there specifically to take advantage of a 20% off coupon special and a $10 customer appreciation coupon, and both are over and above any marked specials in the store. You’d have to go to their website to know which days this combination works, and it changes from day to day like a revolving door. We saved about 50% off of regular prices, so it’s worth the search.

2-3 minutes on each website is all you’ll need. If you have down time at work and your employer doesn’t mind a little bit of web surfing, take advantage of that time to check out what the stores have to offer. You’ll save time and be better organized for your shopping sprees. You might even decide which stores to shop based on which have the better offers that night.

Gift Cards

Do you have a few people on your gift giving list this year that you just don’t know what gift to get them? I’ll bet you do. And can we be completely honest about something else? Sometimes we receive gifts that obviously take a lot of thought and even expense on the part of the gift giver, but…what they got us isn’t something we really like. Have you ever been the gift giver in that exchange? Both situations are uncomfortable, but there’s no need to struggle to get around them. When in doubt, just use gift cards!

Some people don’t like giving gift cards (“there’s no thought in buying someone a gift card”) but if you choose the cards wisely they’re likely to be a bigger hit than buying presents people will neither like nor use, just for the purpose of giving something. I could be wrong, but I suspect that most people would gladly exchange “thought” for gift usability anyway, and gift cards are nothing if not usable.

When gift cards become a problem it’s usually because they’re purchased at stores with limited use and given to someone who either doesn’t have a store in their local area, or has no real interest in- or need for- what the store sells. An example would be buying a gift card to the Sports Authority for a person who doesn’t play sports.

You want to give gift cards that are as universal as possible. Visa gift cards can be used anywhere Visa is accepted, which means they’re especially good for those people on your list who you don’t have a clue what to buy for (teenagers!). They’re available at most large chain stores for the cost of the gift amount plus a small fee, and they come in various denominations.

Here’s another reason to give gift cards: There are many people who have fallen on hard times—people for whom a gift card could be far more valuable than an actual gift. Visa cards, grocery store cards, or gift cards to widely shopped stores such as Target, Walmart or Home Depot would be excellent gifts for struggling families and individuals. If you feel that a gift card might be an acknowledgement of their struggles, buy an inexpensive token gift and attach the gift card to it. They’ll have a present to open, plus a much needed source of ready cash. Perfect!

What are you doing to save on money, time and stress this Christmas season?

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The REAL Meaning of Christmas

Guest Post by Philip Reed

Whether you’re feeling affected by recent economic troubles, or you’re just looking for a few ways to lessen the pinch on your pocketbook, here are some simple ways how to save money every day.

Transportation

Commuting can be a major expense! Not only do you have to pay for fuel, but there is also additional maintenance and even tolls in some areas. Depending on where you live, parking fees can add up quickly. Just owning a car is a major expense in itself, but a long, daily commute can multiple all of the expenses related to it.

If public transportation is an option, consider whether this would be a productive alternative to getting you where you need to go while trimming a few expenses related to driving an automobile. Still another option is carpooling. In some cites, such as Atlanta, High Occupancy Vehicle (HOV) lanes are dedicated to cars with multiple occupants and usually provide quicker routes that are less taxing on your vehicle.

Gym Memberships

We all have our preferences for how we prefer to stay fit. How often do you use your gym membership? If you don’t go that often, perhaps canceling your membership in favor of a run outdoors or a game of basketball at the park would be more in order for staying healthy.

Just by using a little imagination you can come up with a solid fitness routine for little or no money.

Plan Ahead for Expenses

If you head to the ATM frequently, watch out for withdrawal fees. Find time to go to your own bank to withdraw the cash you’ll need and avoid accumulating these little additional costs throughout the month.

If your own bank charges ATM fees, consider drawing the cash that you need with a personal check. You can take out as much money as you think you’ll need at the beginning of the month or week to avoid making multiple runs for smaller amounts. However you handle it, you can save money just by lowering the number of times you need to run to the ATM.

How many channels do you watch, anyway?

Enjoyable as they might be, you’re only watching one television station at a time. Is your cable bill worth it to you, or do you think you’d be able to do without? Many shows are even available online.

Look for Free or Lower-priced Entertainment

When you know where to look, you’ll likely find ample free entertainment possibilities where you live. Get to know the outdoors. Look for new parks, or find a recreational area you haven’t explored before. Stay in touch with your newspaper (check it online if you don’t want to buy a subscription) and see what free concerts, community theater events, or even high school sporting activities you’d like to enjoy. Hoping for a new book to read or movie to watch? Give your local library a try.

Plan for the Future

As you look to save your pennies now, consider that it will also be to your benefit to have a nest egg built for yourself in the future. Life insurance is a common method people chose to protect themselves and their families when they die. This offers a family a source of income in case of a tragedy, and is especially helpful if there are bills and other debts still to be paid. If you decide this is a smart investment for you, shop around carefully when looking for life insurance quotes.

It’s important to be truthful during this process, particularly when offering relevant health information. Otherwise, the life insurance rates you are quoted over the Internet, or that you receive from an agent in person, will not be accurate.

With a little effort and some time, the cost-cutting measure you use can add up into considerable savings. You will likely be grateful for the time you have spent improving your finances.

Related Posts:

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What TV REALLY Costs Us

By Kevin M

One year ago—just about to the day—I took my first stab at this topic in Why Earning More Money is More Important than Frugality. It was one of the most popular posts I’ve done in the two years that I’ve had this site up and running. It seemed for a while that I’d covered the topic as thoroughly as I could imagine, but the subject has hit the blogosphere with a vengeance in the past couple of weeks stimulating additional thinking.

That doesn’t mean I’ve changed my original thoughts on frugality—quite the opposite. I’m now even more convinced that I was heading in the right direction on the first go round. My comment on Len Penzo’s 100 Words On: Why Frugality Has Its Limits made me realize that the subject is even more important than I imagined and that it’s time to take it on with some fresh ideas.

Frugality in a changing world

I believe we’re in the early days of a massive era of change that will eventually earn itself a chapter or two in the history books. Think Industrial Revolution here—an event so all-encompassing that it will change life as we know it. Space doesn’t permit presenting all of my thoughts here so it’ll be the topic of a future post that I’ll roll out as soon as I get the bugs worked out of my crystal ball.

In the meantime, we can safely say that at the moment we’re living in world of changing circumstances—I’d dare say negative for most, though I think the very long term will hold many positive surprises.

When change comes, and it seems disruptive in nature, we can do one of two things. We can either circle the wagons and work to protect what we have, or we can plunge forward and try to reinvent ourselves to thrive in a very different looking world.

The obsession with frugality strikes me as part and parcel of the circle the wagons strategy. Inside the wagons, we may feel secure and think that we’re in control, but as conditions outside deteriorate they’ll eventually drag us down in spite of our best efforts.

Frugality works best when you have something approximating employment for life, in a job that pays a living wage WITH full benefits AND predictable increases in pay. In that situation, your income is reliable and rises with time. By cutting expenses and saving the difference you save your way to prosperity.

But that’s not the world we live in any more. Jobs and long term employment are no longer certain, benefits are being cut, and raises–if you get them–are puny. Frugality doesn’t work as well in that situation and isn’t a long term solution to that problem.

The ultimate solution is to move beyond the circle, charge forward and work to cut a new path. Frugality doesn’t prepare us for that, at least not the way it’s generally used.

Micro-frugality vs. macro-frugality

So I don’t risk painting with too broad a brush, let me say that I think there are different types of frugality, and I can identify two as general categories.

Micro-frugality. This type of frugality is searching two dozen expenses for savings in each in the hope that collectively they’ll reach the level of real money. While that may (or may not) happen, the effort itself is exhausting, and requires constant vigilance. It has us researching, analyzing, discussing and executing cuts in nearly all expenses that make up our financial lives, and the effort can easily rise to the level of a part time job.

Macro-frugality. This is cutting the two or three biggest expenses that have the greatest impact on your finances. If your house is costing you $2000 per month between the basic house payment, utilities and upkeep, you replace it with one that you could live in for $1200 a month. A car with a $600 payment is replaced by a used car with no payment.

Macro-frugality makes abundant sense, especially if you’re trying to lighten your load to make a career push forward. You cut the structural expenses—which often causes other expenses to drop as well—and let the rest go. It’s better because you make two or three major changes and then move on. Simple, with maximum effectiveness.

Micro-frugality on the other hand, has us buried in small details. While we should be focused on generating fresh income streams, we’re busy plugging small leaks in our budget. What’s the end game to that strategy?

Is frugality motivated by a hatred of work?

That’s a strong statement but before you judge me too harshly for writing it, I came up with it while reading the comments posted on a New York Times article, Forget Frugality: Focus on Earning More.

The article was written by Ramit Sethi at I Will Teach You To Be Rich, an author and personal finance blogger who’s been very outspoken in his criticism of the frugality faith. There were 90-something comments responding to the article, and from the 40 or so that I scanned, the responses were overwhelmingly negative. I’d even go so far as to say that some of them were hateful, as though Ramit struck a deep emotional nerve.

Why the rabid responses? Ramit was suggesting that rather than use their free time to find new ways to save money, that they instead find ways to earn more money. That was the bone of contention—the frugal wanted to save money precisely so they wouldn’t have to work more.

But was Ramit suggesting that they become workaholics? Hardly. He was suggesting that they think long term. What he was pointing out was that the better use of spare time is to use it to earn more money so that credit cards and other loans can be paid off or savings can be accumulated. With less debt and/or more savings, structural improvements in life take place ultimately resulting in less work, more free time and more money. Its old fashioned work-save-invest, but the masses apparently want no part of it—too much work in the short run.

The primary risk of over-emphasizing frugality

Ever wonder why human beings are creatures of habit? It’s because life is easier that way. We don’t want to have to stop and think about everything we do, to hatch new ideas for the things we do every day, especially those that are mostly about survival. Going into automatic pilot is what we might think of as “brain save mode”, and there’s a good reason for that.

Each of us has only so much creative capacity, and so much time. True, some people are more creative than others, but all of us have the ability. The difference is primarily that some people make better use of their creative skills than others. The same is true of time. Each of us have only 24 hours a day, and much of that is consumed by work and sleep, leaving precious little time for much else.

That begs an obvious question: what are we spending our creative energy and time on?

Are we going to spend it analyzing four cell phone plans to see which is the cheapest? Running from store to store to see who has the best price on laundry detergent? Investing 100 hours of our time on research and efforts to weather proof the home so we can save $25 a month on energy bills?

All of these can seem like noble pursuits, but making a deep dive into details can also be a form of creative avoidance–that’s majoring on the minors, and it’s guaranteed to keep us right where we are.

That’s the risk that frugality brings—that the lions share of our creative energy and time will be dedicated to what amounts to an effort to keep what we have. In a period of changing circumstances and declining economic fortunes, will that be enough? Will it move us successfully into the future? I have serious doubts.

Yes, income generation IS more important

Frugality has its place—certainly macro-frugality does—but what I’m challenging is the notion of frugality as some sort of overriding financial guiding principal. That’s a role it can never fill. If your income shrinks down to zero, you won’t be able to cut enough expenses to survive.

Only by increasing income and generating new sources can we move forward, but it may be even more important than that. Why?

1. Jobs and careers are disappearing fast, and many of us need to completely retool in order to be economically relevant

2. Employers are no longer providing the type of training that will lead us to relevant new careers (they too are circling the wagons and have largely abandoned forward strategies like training in favor of cost cutting and survival)

3. Entrepreneurial skills are becoming critical as the choice for the unemployed is increasingly between self-employment and no employment

4. Developing multiple income streams may be the single best survival strategy in a world where fulltime, fully benefited, living wage jobs are becoming increasingly rare

5. University educations are not only prohibitively expensive, but the coursework is increasingly out of step with the most recent developments in the economy and job markets

6. Developing new businesses and income streams will take time, so the time to get started is now

Income earning ability is our single greatest financial asset. Our overriding financial principle then needs to be that we’ll always have an income—preferably a generous one. Making that happen is now completely up to us, and where we spend our creative energy and time will determine how well we do on that front more than anything else.

If you’re looking for a way to spend more time earning income to help your cash flow, check out my post, The Freelance Blog Writer Side Hustle. Even if you’ve never written professionally in the past, this post will help you get started converting your passions and interests into an income earning business that you can work in from the comfort of your own home.

Your thoughts?
 

Related Posts:

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Multiple Income Streams to replace One Man-One Job?

OR…Is Saving Money Bad for the Economy?

By Kevin M

I came across this article a few weeks ago, Industrial output falls as consumers cut back spending, and have been trying to decide what it is about it that I find so disturbing. I’m not targeting it as some sort of special case; in fact it’s one of hundreds of articles I’ve read saying pretty much the same thing. News program talking heads trumpet it all the time. Loosely, what’s good for your bank account is bad for the country.

Do we actually believe that line of thinking, or do we just politely tolerate it? Surely we have to know better!

Now, I try not to do macro economics on this site, but it seems to me that this idea that the citizenry saving money is bad for the economy is some sort of article of faith that no one questions, at least in higher circles. And I don’t buy any of it!

From where I sit, it seems that the absence of savings is at the heart of our economic troubles. When a person has no savings, he lives paycheck-to-paycheck and is forced to borrow or turn to the government when he needs money in excess of his regular cash flow. In most households, this will happen most of the time—life’s just that way I suppose. But that conundrum is what gets the debt treadmill going, and once you’re on it, default is just a matter of time.

Multiply that by millions of households and you get…about where we are right now.

When were savings banished from “The American Way”?

I get what economists, politicians and business leaders say about the connection between spending and economic growth, but that mantra has been emphasized too many times in too many places and without serious reservation. The public has bought into it, and why not? After all, consumption feels good–and savings? Well…that’s kind of boring. It doesn’t fit with the media messages we’re getting, and besides, the experts and leaders say it’s bad for the economy. It’s our patriotic duty to spend!

If you’re addicted to spending, but you don’t have sufficient income to support your consumption, what do you do? You borrow.

I’ve even heard borrowing as a twisted version of “The American Way”. Some take comfort in reciting it just before signing on to a new loan or taking yet another swipe of a well worn credit card..I’ll just borrow to pay for it; after all, it’s “The American Way”. Really? Maybe that’s our credit version of “everybody’s doing it”.

By all accounts, borrowing IS a major part of life in America. We even have laws guaranteeing everyone equal access to credit. By contrast, no similar laws exist guaranteeing us equal access to healthcare (I’m sure you’ve heard of pre-existing conditions!). What does that say about our priorities?

Despite the fact that millions have grown up in a world that only knows easy credit as a means of consumption, it wasn’t always true. Not even for most of our history.

There was a time when you only bought with “cash on the barrell”; or put another way, if you had to borrow to buy, you couldn’t afford it. Then there was “a penny saved is a penny earned”—early patriot Ben Franklin, I believe—but it sounds so quaint now, doesn’t it? And not so long ago when I was a kid, you’d almost rather fall on your sword than file for bankruptcy or enter foreclosure. When did all of that go away? Are we better off that it did?

How is a bigger bank account a bad thing?

Here’s where I have an issue with the experts: while it may be true that millions of people suddenly saving money will slow the economy, I think it’s just the kind of remedy needed to give us long term prosperity. Economists talk about credit as the magic bullet that juices the economy; you never hear them talking about savings rates. Perhaps they think they’re irrelevant.

For an individual, a fat bank balance is the very definition of prosperity. Rampant consumption is it’s hollowed-out, idiot cousin—a mere facsimile of the real thing. While too much money going into savings may be bad for the economy in the short run, it’s virtually the best thing any of us can do for ourselves and for the long term health of the economy.

Borrowing can juice the economy short term, but once people reach the limits of their ability to pay their debts, a crash follows—sound familiar? If the economy were filled with people living within their paychecks, stashing some for the future, and buying only gradually—but continuously—we’d have steady growth without all the painful recessions we’ve been having.

Slow, steady, predictable growth may not provide the buzz many have been getting from the short term credit induced bubble-booms, but they would allow us to make long term plans, and that can only help us, the economy and the country.

It was the kind of household budgeting that was going on back in the “good old days” of the 1950s and 1960s. Is it merely a coincidence that the US savings rate has been collapsing in the early 2000s, just before the start of the financial meltdown? I doubt it.

On an individual level, having a large bank balance gives us options; we can…

• save up for major purchases, rather than borrowing
• use it as insulation from a job loss or some other crisis
• use to pay off debt (side benefit: being debt-free gives us more control over our paychecks, allowing us to save even more)
• choose to invest some of it, earning still more money
• use it to start a business (or to keep us going while we build up a cash flow)
• just sit on it and feel better about life.

If you have no savings, you may be doing your patriotic duty by helping the economy with borrow and spend, but you can’t do any of these!

With a cash cushion to back you up, life becomes more predictable. You aren’t being batttered by every missed paycheck or every unexpected expense that rears it’s ugly head. You can make long-term plans, long-term investments and build long-term prosperity for yourself, your family, your community and the country.

Is there anything unpatriotic about that?

Related Posts:

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Ten Financial Mistake You Can’t Afford to Make

By Alban

Chances are, you’ve recently found yourself lamenting the cost of things these days, and wondering how everything got to be so expensive. Well, rather than automatically hand over the sticker price for a purchase learn how you can negotiate a better deal and save yourself some money.

Haggling on price is not something which must be reserved for the market place on your next vacation, instead there are six tips you can use to help you pay what you believe is fair price, rather than the market up retail price. And don’t feel bad—if the seller really couldn’t afford to offer you the discount they wouldn’t, no one is going to run their business at a loss just to clear stock.

1 – Know what you want to pay

You can’t negotiate a better price if you don’t know what that price is because negotiating is all about directing the sale towards the price you want to pay with these subtle tips – therefore you need a starting point. All you need to do is consider the selling price and decide on what you think the item is worth and what you’d like to pay for it.

Then start negotiating with the seller below your ideal price because if your first and second offers are knocked back, your third offer could be accepted at your ideal price. Plus, you may be able to get the item even cheaper, since the seller doesn’t know your limit.

2 – Find hidden flaws

If you’re not getting anywhere in trying to reduce the selling price, point out flaws or defects in the product. Perhaps the item is a display model and has a few scratches or doesn’t come in a box. These are perfect reasons for a seller to offer a discount, especially when you start pointing out these flaws and they begin to think that maybe the item isn’t worth as much.

If you’re at a garage sale or at a market you can point out the disadvantages or defects of one item over another and though you may not care, you have inserted leverage into the negotiations which now has the potential to save you money.

3 – Take your time

Don’t immediately jump at an offer which sounds good without considering it fully. There are plenty of slick sales people out there who are not new to the negotiation game and they know how to spin an offer and skim over your questions and concerns to make the sale.

Think about the offer and what it really means; a good way to do this is to repeat the offer back to the seller to clarify the details, but make sure you listen carefully. Remember that if a price sounds too good to be true it probably is, so consider why the seller would be offering such a great deal. Also don’t be influenced by a sob story and don’t be distracted by the seller because many sales people will try to befriend you and search for commonalities between you to make you doubt your ability to negotiate with a ‘friend’.

4 – The power of confidence

A successful negotiation is about confidence and if you think something is overvalued, then stick to your guns and negotiate to save yourself some money. Have an attitude of success by making sure you stand up straight, don’t fidget and look the seller in the eye. Speak clearly and concisely and leave your emotions out of it, getting angry or frustrated will not win you the best deal.

5 – Negotiate with someone who can make the decision

If you find yourself negotiating with someone who is not actually authorized to offer a discount you will be negotiating to reach a lower price, but that price then has to be approved. You were not actually part of a real negotiation as the real negotiation starts when you are able to talk to the manager. You risk losing your focus and motivation if you have to start all over again.

6 – Save money through your job

Having more money isn’t always about direct savings on the ticket price of things you buy. You can negotiate with your boss to see if your job can help you save. Many companies are not able to negotiate a pay raise at the moment because it’s still simply not in the budget. However, you can negotiate to add value to your employment package.

This is the golden rule of successful negotiating because you shouldn’t give up something – a pay raise – without getting something in return – like an employment benefit. Therefore, consider what you want to be able to save money on and your employer may be able to include that in your employment package. For example, they may be able to add health benefits for you so you can save on the private health cover you’re paying for to cover yourself and your family.

Alternatively your employer may be open to salary sacrifice, where your pre tax income pays for something you need for work. For example, instead of receiving a $5,000 pay raise, your employer may pay for a new lap top or for your home phone and internet if you take work home.

Moral of the story: nearly everything’s negotiable–find ways to use that to your advantage.

Alban is a personal finance writer at Home Loan Finder, which offer information on reverse mortgages.

By Kevin M

If your computer is running poorly and you think it may be about to crap out, don’t junk it—the problem may not be the computer itself. It may be the operating system.

Our kid’s computer, a desk top, got hit with a virus about a month ago, one that the AVG system wasn’t able to stop. The computer was at a near standstill. We checked with the Geek Squad to see what they would charge to remove it–$200 plus tax.

Not gonna happen. The computer is five years old, and we’d sooner replace it than pay that much to have it fixed.

We added another anti-virus system that we’ve had excellent results with on our other computers (Trend Micro). It seemed to do the job, but the computer wasn’t moving any faster. I spent an hour and a half on the phone with the techs at Trend, who identified that the problem may be deep in the system registry. They did get the virus thoroughly removed according to their system and Microsoft’s. But still no luck on improving the performance of the computer.

Time for a new computer?

Was it time to toss the computer and buy a new one?

In truth, the computer had been running slow for a few months. Since it’s used mainly for Facebook, emails and games—a lot of games—we assumed it was just worn out from too much use and too many applications.

Right now, we have two desktops and two laptops, and though the desktops will eventually be replaced by laptops, we want to keep them around as long as possible.

Our son talked with a friend of his about the computer, and the friend suggested that we try adding a different operating system to the computer, rather than getting rid of the unit. He knew how to do it, and offered to install it.

Now our son’s friend is 18, and though we might have been skeptical of his technical skills, there really wasn’t much to lose since the computer was heading for trash pick up the way it was.

An old computer that’s good as new

Our junior computer expert came in and installed the Linux system over the existing Windows system. Once he did, the computer functioned as if it were brand new. The improvement in speed was incredible. We couldn’t have bought a new computer that would run faster.

The real problem was never the computer. I’m speculating here because I’m not a computer tech, but I’m guessing it could have been the plethora of games and applications added to the computer over the years. Or it could have been the hundreds of Windows updates added automatically. What ever the issue, the constant piling up of applications and updates made the computer seem old and tired.

By replacing Windows with Linux, all of that went away and the system now functions flawlessly.

That might invite the question, why not just reformat the computer? I’ve done that myself, and it took many hours to re-add Windows to the reformatted hard drive. The Linux addition took out Windows in the process of the download and the entire exercise took less than an hour.

Some caveats before going this route

One thing to understand about this process is that when you put Linux, or any other operating system on your old computer, everything associated with the original system will disappear. Windows has its own applications—email, Word, accessories and the like—all of that will be gone when you add the new system.

With that in mind, back up documents unique to Windows, either on cd’s or on another Windows based computer. This includes important Word documents, photos and even emails.

Another alternative—that we didn’t choose—is to “partition” the computer. In this way, you can have dual operating systems, with both Windows and the new system working at the same time. This will enable you to retain unique Windows records, but to surf freely (and quickly!) in Linux. Windows won’t improve with the partition, but it will enable you to bridge the move from one system to the other at your own pace.

A near perfect ending

For my own purposes, I like Windows and would have preferred keeping it, but it isn’t my computer. My kids are happy with the speed and performance, and we’ve managed to keep an old computer for longer than we thought possible.

The moral of the story is that we usually have options if we dig a little deeper. Often we’re trained to ditch anything that’s more than a few years and replace it with something new. But if funds are tight and alternatives exist, it may be better to see what can be worked out.

There’s always a question of fix or repair; for now, it looks like we’ve saved ourselves a few hundred dollars on a new computer by taking a chance on the repair option.

Have you ever done anything like this with an “old” computer? Do you have any other ideas on how to extend their lives?

By Kevin M

America is often described as a “throw away society”. We buy things—usually brand new—use them for a while, get rid of them in some form or fashion, then move on to the next thing.

This creates an enormous pile of stuff sitting somewhere—much of it of pretty good quality—and presents a real financial opportunity to anyone willing to invest some extra time and effort in buying what they need.

Why buy anything used? For one thing, new isn’t always better; sometimes we can get better quality merchandise second hand that we could never afford brand new. Sometimes, the item in question is one we don’t use that much, or won’t use for very long—why pay a premium for it?

But more important by far: any money we can avoid spending is money that can go either into debt reduction or directly into savings.

What are some items that are better bought used than new?

1. Furniture

It can cost thousands of dollars to buy decent quality new furniture for just one room, and tens of thousands for an entire house. But you can often buy used furniture for ten to twenty percent of what it costs brand new which is also a way to get better quality furniture that you can’t afford to buy brand new.

Check out estate sales, garage sales, second hand furniture stores, your local newspaper or your company or neighborhood newsletter to see what’s available.

2. Cars

There may be tangible advantages to buying a brand new car, but the financial factors heavily favor used cars. For one thing, used car prices are much more negotiable, especially if you’re buying direct from the seller. Depreciation is another factor. The average new car will lose up to 20% of it’s value in the first year and 10% in each of the next four years which makes buying new a guaranteed money loser!

You only have a certain amount of money to put down on a car, new or used, but if you buy new, you will most likely make up the price difference by taking on more debt. Buy a used car and keep the loan to a minimum. Better yet, buy a used car you can pay cash for and skip the loan altogether. Driving it may not be such a rush, but your non-car life will be so much better for not having the debt that you might not care.

3. Car parts

If your car is at least five years old, you can save a small fortune buying used replacement parts rather than relying on new parts from a repair or body shop. You can find replacement parts on the web, and the availability is greater than most of us imagine. I recently paid $25 for a replacement taillight box on our van that would have cost at least $200 brand new.

4. Toys

My kids are out of the toy stage, but one thing we learned as they were growing up is that a toy, no matter how important it seemed at the time, was just a passing phase. And that phase can last as little as a few hours!

Here’s a little secret: kids can turn just about anything into a toy. The brand-new-in-the-box-from-the-store thing is but a momentary rush. They may play with it for a few days or a few weeks, but rest assured they will get bored with it and throw it on the heap with the other old toys. Buy used toys that way their phases won’t cost so much and put the money you would have spent on new toys into something more permanent, like their college fund.

5. Clothing

The problem with clothes is that they aren’t permanent. Sooner or later they’ll either fall apart, go out of style or no longer fit. This is especially true with children’s clothes. So why spend so much money buying them brand new?

Thrift stores have clothing available for impossibly low prices, generally $3-$5 per article. Much of it is gently used, name brand clothing discarded by fashion addicts who got rid of it simply so they could make room in their closets for the new spring (or fall) lines. It takes patience and digging through the racks, but the savings are substantial.

6. Tools

If like most people you’re a weekend handyman why pay a premium price to buy a brand new tool you probably don’t use more than once or twice a year? I bought a good quality manual hedge clipper at an estate sale for $5 and have been using it 3-4 times a year to trim my hedges—for 15 years! I have many other tools that I’ve gotten at less than retail, but that one stands out in my mind.

A good quality tool can last for many years, whether you pay $5 used or $50 new. Unless you use tools in your occupation, there’s no need to have hundreds or thousands of dollars worth sitting your garage or basement.

7. Books

My son got tired of the meals we prepare around here and borrowed a cookbook from the school library in the hopes of stoking our creative energy. His choice was an outstanding one, and we decided we needed to have the book. Brand new it was $30, but we got it on Amazon for $8, including shipping. We use the book all the time, but the fact is most books are read then either shelved or discarded. So why buy them brand new?

Check Amazon.com before buying any book brand new. Chances are they have several used copies for a fraction of the price. If you’re a book hound, get familiar with the used book stores in your area and frequent them regularly.

8. Secondary appliances

In order to stretch the food budget, many people have or want to have secondary appliances, like a freezer or a second refrigerator. But if you already have a refrigerator, why pay the retail price for a second unit that’s hidden in the basement and used mostly for extra storage? Somewhere in your community, someone is looking to sell an appliance, and you can probably get a few years use out of it for just a fraction of the price brand new.

9. DVDs

We don’t buy too many DVDs in our home these days because we began to notice a pattern that when ever we purchased a must-have DVD, we’d watch it two or three times, then store it in the cabinet with the 100 other DVDs we don’t watch any more. That’s a lot of money sitting in a cabinet gathering dust! Cheaper, used DVDs are the only sane way to buy a movie that you’ll probably only watch a few times in your life.

10. Video games

This is really an extension of the discussion above on toys—but for older kids. Like toys, video games are just phases that pass, so the less you spend on them, the better.

We’ve gotten some decent discounts buying used videos through EB Gamestop, finding that the quality is generally comparable to brand new ones. The one or two that did degrade to the point of impairment turned out to be a non-problem because the kids just moved on to another “hot” game. Like DVDs, video games just aren’t worth a heavy investment.

 
A disadvantage of buying used goods is that you may not get exactly the items you want, but that will be a small price to pay for the extra thousands of dollars that you won’t spend or borrow, that can be used to improve other areas of your life—like your finances!

Can you think of any other items that are better bought used than new?

By Kevin M

There’s a “stealth expense” that chews through budgets and often leaves us with an empty bank account or even a little deeper in debt each month; its called entertainment expense, and at least part of the problem may lay in the fact that we’re usually reluctant to even view it as an “expense”.

Maybe this is the case because entertainment has a way of defining us—it’s often who we are, which has to be something more significant than just an ordinary expense, doesn’t it?

We can be meticulous about budgeting for housing, groceries, utilities and a host of other expenses, but entertainment is often—to borrow a political phrase—“off budget”.

Entertainment diverts our time into stimulating activities in ways that usually won’t happen through working at our occupations, managing our homes or many of the other more mundane tasks we participate in as a matter of survival. People have sought to do this since the beginning of humanity, but the one thing that’s changed radically is our contemporary willingness to break the bank to make it happen. That’s the part of it that we need to control!

The most basic purpose of entertainment is to have a good time; we need to get past the idea that we need to spend a lot of money, or even any money at all, in order to make that happen. We all have a need to be entertained but there are inexpensive ways to do it, and then there are the other ways—the ones that often lead to debt.

Entertainment as an addiction

I’m not a psychologist, but I’d be willing to wager that much of the spending on gold-plated forms of entertainment these days is an attempt to compensate for weaknesses in other areas of life, such as stress, lack of companionship, lack of community, or other voids. This goes beyond the realm of simply looking to have a good time, to the point that the planet is now crawling with entertainment addicts. And like all addictions, it must be controlled.

Replace costly entertainment habits with less expensive ones, and we can do that simply by engaging in more participatory activities, and by increasing the amount of time we spend with people. Bigger picture, much of the reliance on entertainment might be replaced by reducing stress in your life, by increasing connections with family and friends and with involving yourself more with the community and the world around you.

Do these things, and you may find yourself craving fewer restaurant meals, amusement park visits, trips to bars, and all of the other entertainment activities that can suck a budget dry.

Instead of eating out, going to the movies, to the mall to shop or to costly amusement parks and other venues, come up with some inexpensive alternative activities you can engage in so that you can still keep yourself entertained but without spending a bunch of money to do it. Don’t be afraid to consult with family, friends and coworkers for more activities—see what others are doing for entertainment, especially those of a more frugal persuasion.

Compile a list to help you when you’re looking for something to do—this will help you to develop some new habits and attitudes toward entertainment, at least until it becomes set in your mind.

Eight activities for under $20

To help you get started, here is a list of activities which will get you out of the house and into the world without bleeding you dry:

1. Visit with friends and extended family—your house or theirs; we’re social creatures so people are the best source of entertainment
2. Head out to the local park or a nearby beach; pack a lunch, bring your bikes, in-line skates or a ball or two, and spend a couple of hours just taking it easy and enjoying the outdoors
3. Window shop at the mall; bring $10 with you and remove your credit and debit cards from your wallet; sometimes just being out and about is all we really need
4. Plan “Family Night In” with a home cooked dinner and a video, or cook a nice dinner at home, then go out for dessert afterward—which is just as much fun but much cheaper than a full restaurant meal
5. Go hiking in a state or national park—you don’t need to be an athlete to walk, and you can do it at your own pace and enjoy nature as you go
6. Pass some time in your local library, or at one of the chain mega book stores; you can browse or read for hours and no one will ask you to leave. Some large book stores also have coffee shops, and you can always get a cup for under a couple of dollars.
7. Hang out with family or friends at Starbucks or some other coffee house
8. Pack a lunch or some snacks and spend the afternoon or evening at your local neighborhood or community swimming pool. At our community pool, daily admission is $3 per person, $12 for a family of four, and there aren’t a whole lot of places you can go for less than that.

This is just a start—work on expanding the list, and I’ll bet you could come up with at least 20 activities you can engage in for less than $20 each and many of them free. A lot depends on your own personal preferences, but the more possible activities you can come up with, the less expensive your entertainment will become, so be purposeful in developing a list.

We’ve found over the years, that doing several low- or no-cost activities in combination can make for an enjoyable day. You can have a picnic in the park for dinner, window shop at the mall for a bit, hang out at the bookstore for a while, then go to Starbucks for coffee and dessert—an enjoyable evening for under $20.

The more options and combinations you can come up with, the less likely you’ll need to go to the movies or an amusement park.

What are some other ways you can think of—or have done yourself—that you can entertain yourself or your family for not a lot of money?

By Kevin M

Companies are always trying to get us to take their bundle plans, neat packages that promise a veritable one-stop shopping trip for all of our communication needs. Cable TV, internet, land lines, cell phones—they’ll load them all into a pretty little bundle for us and provide a nice discount for dealing in bulk.

It’s easy to see why we’re drawn to these arrangements. Not only do we get the lower rate for the package deal, but we can also consolidate several monthly bills into one and, we might reason, with so much of our business placed with one provider, we’ll have clout! After all, surely a provider won’t want to lose ALL of our business if we’re unsatisfied with any single service.

As attractive as that might sound—especially from a life’s simplification standpoint—my experience with bundles hasn’t been terribly positive. As good as the bundle plans might look from time to time, I’ll keep my communication services spread over three or four different providers.

Here’s why…

Not all providers are good at all services

I learned the hard way that a company that’s good at one thing may not be good at others. We took a too-good-to-be-true package from one company we were successfully dealing with. We already had their landline phone service which, though pricey, was excellent. When they came around bearing gifts with an internet and cable TV package we jumped. The option to add our phones into the package at a substantial discount was open, but given my normal hesitation in this area, we decided to wait before combining.

Thought the internet service was nothing special, the cable was outstanding—except for one thing: most of the time it didn’t work.

Five teams of technicians came to the house over a space of several weeks, but none were able to identify the problem, let alone fix it. We were down more than we were up, and the internet usually went with it. After a two month experiment, we terminated the deal. Sadly, we had the same company for our cell phones a year earlier and they were equally inept at that. The only thing they were good at was landline phones, but they weren’t inexpensive either.

Needless to say we severed all ties with that company, including the excellent but pricey phone service. Wiser for having been burned, we returned to our policy of spreading our services over several providers.

That company needed to do what they did best—landline telephones—and find a way to do it for less, rather than branching into providing services that are beyond their abilities.

Lack of flexibility

When we’re shopping for deals and price is the primary criteria, we can be leaving a lot on the table in other areas. What ever company you decide to deal with you’ll be limited to the features and product selection they offer on any service. They may have the best cable TV package on the market, but if their cell phone and internet services are something less, you’ll have to take them anyway or lose the pricing benefit of the bundle.

Customer service and billing can be another flash point. If billing is a problem with one service and you have four services with them, you’ll have four billing problems. Or one billing problem spread over four services. It’s not a mix and match, you’re taking what ever they have with all the attendant problems that go with them.

A lot of people prefer a four-in-one bill with all services on a single bill. While you might save money with this, you can end up with one massive monthly bill the size of a modest car payment. If you’re not particularly good managing your budget, this can become a problem.

It restricts the search for better deals

The communications industry is in a constant state of flux. Deals and packages come and go and the only way to be able to take best advantage of them is to be ready to make a move when they come up. Bundles complicate this.

When you’re in a bundle, the price you’re given is usually dependent on having all of the component services in the original plan. If you withdraw one service to pursue a better deal with another provider it will probably mean that the rate on the remaining services will go up, reducing or even eliminating the advantage that might be gained by switching one service. This is one way that providers keep us from straying from their bundles.

One of the factors that might push you to look for better deals is of course that once you’re in a bundle the price will go up. Sometimes it will go up in unannounced small increments that you may not notice unless you compare this month’s bill to one from a year ago.

Sometimes it will go up in a single, announced increase. And sometimes you’ll experience both the gradual monthly increase along with a sudden spike.

Often, we pay the increase because replacing all of these services can be a real hassle. You spend hours on websites studying the matrix of service and program combinations of competing provider bundles, and once you select one, hours more on the phone working out a series of small but critical details. Then the service people need to come out and you need to be home when they do. After everything’s up and running, it’s nail biting time to determine if

• the combination of services is right for you
• if the service performs as promised
• finally, when the bill comes if the pricing is exactly as promised; this is complicated by the fact that you often have to wait two billing cycles to know for sure, since the initial bill usually contains a host of adjustments of one sort or another.

Moral of the story: moving entire bundles isn’t easy—which is reason number two why you probably won’t move it. And the providers know this too.
 

The good news on bundles is mostly up front when you first enter them. But the price advantage tends to decline in over time as other services become available for less and the cost of your bundle increases.

What are your experiences with bundles? Did they save you money? Were/are you satisfied with ALL of the services in the package? Do you have any bundle horror stories?

Action needs to precede acquisition in the quest for health and fitness

By Kevin M

Maybe it’s a cultural thing here in America that when ever we need to strike out in a new direction we impulsively believe that it requires spending money to make it happen (see the National Debt for tangible confirmation). That might actually be necessary in some cases, but fitness is really more about motivation than it is about gym memberships or fitness equipment. Yet many people join health clubs or buy expensive fitness equipment precisely to give them that motivation.

I believe that thinking is putting the horse before the cart. Shouldn’t we first prove that we have the motivation and energy—and can make time in our schedules–before spending any money?

Here’s a fundamental fitness reality: before there was exercise equipment, there was plain, old exercise. Exercise equipment (and the gyms they occupy) is higher level stuff; before moving onto them—and the money they cost—first prove that you’re committed to plain, old exercise.

Establish a pattern before paying for ANYTHING

For a lot of people, working out falls somewhere between going to the dentist and serving on jury duty on the List of Desirable Activities, so it’s easy enough to see why we look for props to help motivate us to do it. A gym membership or a shiny piece of equipment, set up in a special place in the family room, can serve as a reminder of our commitment—of our financial investment–in our plan to get fit and healthy.

But why make a monetary investment at all? You’re already investing your time and your energy and that should be enough. In fact, if you can’t find the time or energy, no amount of money spent is likely get you where you want to go. (Fundamental fitness reality #2: exercise is repetitious and therefore boring; adding equipment to it merely delays but doesn’t change that outcome.)

The same is true of dieting. It’s beyond pointless to make an investment in a costly program like Weight Watchers or Nutrisystem before demonstrating that we at least have the ability to do something as basic as cut down on the amount we eat.

Fitness Freebies and near-Freebies

If you agree that action needs to precede acquisition in the quest for fitness, what’s the next step? No one exercise regimen is right for everyone, but here are some suggestions that will get you started and cost you nothing:

Walking. This is the most basic form of exercise and anyone can do it. You don’t need any training or special equipment, other than a decent pair of tennis shoes and you probably already have those. If you can’t at least walk regularly, any attempt at a more exotic form of exercise is probably doomed to fail.

Jogging. This is basically walking but with speed, with the one difference being that it may require somewhat better footwear since it’s more taxing on the feet. But you don’t need to start out jogging; you can build up to it by walking. Once you establish a walking routine, jogging is a logical extension. In fact short of competitive running, it’s an end game in itself and requires no complicated or expensive equipment, let alone a gym membership.

Biking. Even if you haven’t been a regular when it comes to exercise, there’s a better than 50% chance that you have a perfectly good bicycle gathering dust somewhere in your home. And if you don’t, there’s an equal chance that someone in your neighborhood or family has one that they’d be perfectly happy to part with for a few dollars.

Swimming. Many people live in apartment complexes or in swim and tennis neighborhoods where pools are part of the homeowners association (HOA) package. But it’s a fact that the majority of people never (or hardly ever) use them. If you have this feature in your neighborhood, take full advantage of it. After all, swimming is great exercise and you’re paying for it anyway!

Neighborhood fitness rooms. Many swim and tennis neighborhoods—as well as apartment complexes—also have fitness rooms, and they typically draw even less participation than the pools. If you have one, take full advantage of it, especially if you’re thinking about joining a fitness club. Work out at the neighborhood fitness room until you outgrow it, by then your commitment will be real.

Free fitness videos. You’re probably familiar with YouTube for the music videos and movie, TV and news clips, but the site is also loaded with how-to videos, including exercise videos. And best of all, they’re all F-R-E-E, FREE! Check them out before you pay for any video or infomercial program. You can find fitness videos that don’t require any equipment simply by typing “fitness without equipment” in the search bar. You can also get more specific by entering “back (or chest, or arm, or ab, or leg) exercises without equipment”. Affirmation hint: the makers of those videos have already figured out that it’s exercise—and not exercise equipment—that makes for good fitness.

When you’re ready, invest in some good second hand workout equipment

There’s a flip side to our own lack of motivation to work out that plays in our favor: other people are in the same boat! Because of that, you may be able to get their fitness equipment for a fraction of what they paid for it.

If you’ve established that you have the motivation to work out, and you’re doing it regularly, there are ways to buy equipment without paying the steep prices for new ones. Fitness clubs and hotels with fitness rooms usually have top quality equipment that they trade out periodically for the latest versions. Contact them and see if you can get a deal.

Check the classified section of local websites or newspapers to find people selling used equipment in your area. Craigslist is showing well over 200 ads for used fitness equipment in my area—ten to one at least half of it has hardly ever been used. And the price is negotiable on every bit of it!

Check out new equipment on manufacturer websites or at sporting goods stores, get all the information you can on the best equipment and the various options they have. Once you know what’s out there, what it costs brand new and some of the competing brands, you’ll be fully equipped to know a good deal when you see it. Don’t be timid about making low ball offers; even if the equipment they’re selling is top of the line, you may be the only serious prospect they have.

Save the money you’d spend on a gym membership or fitness equipment until you establish that you’re serious about working out. Only when working out becomes a regular part of your life over an extended period will spending money for it be a true investment. Otherwise, you’re probably just paying for high priced props!

Have you ever joined a gym or purchased fitness equipment that you hardly used? Can you offer other ways to exercise or to get motivated to exercise that won’t cost a lot of money?