This is the first time that I’ve ever tried to “bust the door” for black Friday sale. I went to Toys R us to get legos for my kids. The sale started at midnight, and I was 30 minutes late since I was going through global stock market news due to Dubai debt panic. Stocks are down 3% to 6% around the globe, and US will open with hefty losses too. Gold has already sold off in Asia by $50.

Anyway. At 12:35am, I arrived at ToysRus, and parked my car at a really far away location since the entire parking lot was basically full. Starting from the door, I kept walking to get to the end of line. It took me about 5 to 10 minutes of walking to get to the end of line, which is about 500 feet away. The store itself was full of people already, as I could see thru the window, and there are probably some 200 people outside waiting to just get into the store. I asked the person who was at the end of line, and confirmed that the line was indeed for Toys R us. Man, I couldn’t help but laughed. This is just crazy! Thirty minutes after the sale begun, and I probably won’t get into the store for another 40 minutes.

Realizing that the lego items that was on sale was most likely sold out already, I decided to go home instead. As I drove away from the full parking lot which was designed & allocated for 3 other big chain stores like Toys R us, I also noticed that all other stores are still closed. Boy, all the cars there were mostly for Toys R us, except for a few early campers at other stores.

I’m not sure where the recession is. Looks like the Thanksgiving & Christmas sales may not be too bad. If you want to look for bargains, you will have to find a way to beat others to store. I think I’m going to try online. Bing search engine is providing cashback for various stores. At Walmart.com thru Bing, you can get 15% off. Maybe that’s an easier way to get to your bargains.

Happy Thanksgiving.

I have noticed that Ameriprise, the auto insurance company thru Costco has been raising its price. I just have recently changed to GEICO, because when calling their sales agent, he was willing to not only match the prices from Ameriprise, but also lower the price by a little bit more.

A solid proof again that NOT everything at Costco is cheaper.

After my previous minor car accident, which cost GEICO about $500, they still did NOT raise my price as promised by their customer representative. I’m amazed, and a little guilty, since this is the first time ever that I take money out of the insurance system. GEICO was extremely unlucky in the sense that I have never had an auto claim in my life so far, which is about some 20-year driving history. For all of their great customer experiences, and my “under-water” account (a negative $130 return for the first six months), I’m giving them a thumb-up.

I’m 95% sure that you cannot beat this deal from all major insurance companies. I only pay for $370 every 6 months for two cars having

$100K/$300K body injury liability,
$100K property liability,
$1000 deductible for comprehensive on both cars
rejecting uninsured/under-insured motorists coverage
and $1000 deductible for collision coverage only on my 2-year old Honda Odyssey. My other car is a 10 year old Toyota Camry.

I believe GEICO is quite aggressive in acquiring new customers. So you should be able to negotiate with the sales agent for a little better price if you call them up.

Not sure if any of you catch this story from NPR (national public radio). A homeless person gave $400,000 to NPR, and several other nonprofit organization.

Richard Leroy Walters was a retired engineer from AlliedSignal Corp, but who gave up all the materialism of this world, and what could be afforded to him. Didn’t have a car (but a bike), nor a home, but looks like he did own several stock-related investment, trading over the phone at the senior center. He was an “avowed atheist” but converted to Catholicism on his deathbed. It’s amazing that someone who owned so much, and yet didn’t take any enjoyment of any materialism, while mostly remained atheistic in that process. I have always thought that if someone is atheistic, he or she must take comfort in material things. I guess there are different higher souls.

There are some readers’ comments in NPR website, a few criticizing Walters using resources for homeless people. I must say that after all, Walters gave more than he had received (whether it was given before or after his death). For many, we don’t remember that whether we own a lot of money or owe a lot of debt, when it comes to living in this world, we are consuming resources and relying on others constantly. Our debt to this world is our consumption, whether we pay it fully or not. What would be better served besides paying in full with our hard-earned money is a grateful attitude towards everything that we received.

My wife is currently on vacation with my kids, and these days, I just cook my own simple meals, and bag my own lunchbox: rice plus tofu most of the time. I barely spend any money besides gasoline. I’m perfectly content without many unnecessary stuffs. When I wash the uncooked rice, I am always reminded a Chinese saying: “every grain of rice doesn’t come easy but with sweats of the farmers”. That was of course from the ancient days when many farming was not done through modern day machinery. Regardless, I’m grateful for the abundance of food that I can eat, for there are still too many hungry people in the world.

Oh, yeah, one of my few consumption besides meals is that I did buy a new book from local bookstore, knowingly over-paying $10 for it relative to Amazon.com. Since I frequent that bookstore, I hope that extra $10 goes to their pocket so that they won’t go out of business one day.

I admire what Richard Leroy Walters did. For his gifts, the world was made better.

Labor day weekend is here. Are you travelling less due to the higher gas prices?

I used not to think about the cost of gasoline. But nowadays, I am a lot more conscious about where I travel. Indeed, I find myself travelling shorter distances to everywhere. It just makes more dollar sense. I’m increasingly opting for local restaurants than places far away, and same for travel destinations. More and more people are doing staycation (staying at home), rather than vacation.

What are some good and cheap alternatives for not travelling? Probably renting DVDs to catch up the movies that you missed is one of the cheapest way to spend your hours. The next on the list would be going to a movie. Or simply have a good barbecue or picnic with friends is good. Dining out at a more expensive restaurant that you don’t usually go to is pretty cheap, relative to the cost of a long travel. Hiking or biking in a nearby regional park is pretty good too if you haven’t done it for awhile. Probably the single most important thing about vacation is simply having a relaxed mind-set.

Anyway, I will see you all next Tuesday. I need this break, since I have been just too busy working day and night for almost last month already.

I have always thought that Honda has pretty good mpg. But I’m getting about 16 mpg combined on city/highway on my Honda Odyssey. That is quite different from the statements on invoice: 18 in city, and 25 on highway. That just seems awfully low.

I have always driven Toyota, and this is my first Honda car. My mpg experiences with Toyota is much better. The actual mpg comes out to be so much closer to the invoice sticker. My next car will definitely go back to Toyota.

That brings my attention to Toyota’s Prius. According to a UK AutoExpress report, the next Prius will offer 94 mpg!! That is double of the current 45 mpg. At 94 mpg, even if it costs $10 a gallon, you will only spend 11 cents every mile. That is CHEAP. Okay, even at 45 mpg, it is 3 times better than my Odyssey. At $5 a gallon, the difference between 45 mpg and 15 mpg for 7500 miles is about $1700 every year. In 3 years, you can save $5K on gas, and in 6 years, you can save $10K on gas. That’s about 40% to 50% of the cost of a car.

It’s slightly harder to justify between a 25 mpg on my camry and 45 mpg on a Prius, when you have made your investment in the car already. But if Prius does come out with 94 mpg, I’m just going to grab one if I can, and dump my old car. Unfortunately, I think the waiting list will be really long, given a high gasoline price and long commute distance in California.

I recently got a MP3 player, which I’m using mainly for voice recorder rather than the music player.

I wanted to use the voice recording function in my Samsung cell phone, even though fully featured, but less well-deisigned than Nokia’s phone. Using Samsung’s phone, I can’t voice record a new message without navigating thru menu items and rename the previously created voice file.

Since a simple voice recording function is important to me, I decided to get a dedicated MP3 player/voice recorder. After lots of shopping around, I finally found this MP3 player from Nextar. You can use it also to listen to FM radio. And the 2GB version is only $15 from tribeca tech solutions. The shipping was $7 for one or two MP3 players. The similar model but only 1GB sells for $25 at Walmart.

I think one of the frequent problems that people have with MP3 player is that the rechargeable battery eventually goes dead sooner or later. This model MA566-200 uses an AAA battery. You end up with a more bulky case to enclose it, but at least your unit should never runs out of batteries (even though the battery life is only 12 hours of playing music). In any case, you can choose to use rechargeable AAA battery, so that you don’t need to buy a special $20 rechargeable NiMH battery for a $15 MP3 player.

Anyway. I’m glad that I’ve got this. I almost always have a million things to do, such that I often forget about what I needed to do. With my new voice recorder, I can simply carry it around for recording without the earphones, but only going over my list of things-to-do at office or at home.

I just heard this from my friend. There is a 10% discount (or bonus rather) on any gift cards purchased at the store.

This news has been out there for awhile, because this deal last from May 2nd through July 31st. But being late better than never. The maximum amount of gift card for 10% bonus is $1200 per household. I believe Ralphs stores are only present in Southern California because I can’t seem to locate a store outside of that area. In any case, IF you can find a Ralphs store, 10% is a lot of savings. And if you have one of those HSBC credit card, you get 5% extra savings thru cash rebate on top of that.

And if ever you cannot spend $1200 worth of grocery, you can always purchase the gift cards for other stores at Ralphs (I believe), so that you don’t have $1200 sitting in the bank for Ralphs.

People are shopping more frugally as they should at Costco and Walmart, when the gasoline prices keep going up, and you can’t no longer charge everything on a maxed-out credit card.

But I must warn you that Walmart is really a better store to shop if your family is small, and doesn’t consume volume of (the same) goods. One of the things about shopping at Costco is that you can seldom walk out of Costco without spending $50 or more often $100. I mean, how many $100 bills can you spend without hurting your own budget? Anything that you buy will be packaged into a volume deal. Therefore, even if you just buy a few items, your pocket will be bleeding out with cash. That’s all good if you do need to spend that much. But that’s not so good if you don’t gather up a good plan on your own consumption. When you buy A LOT of anything, and you don’t have a good plan for it, usually you either over-consume, or have the items rotten and wasted, or you need to stock them up somewhere. Therefore, have a good plan for the consumption of the perishable goods before you start to buy. Splitting with friends and families is an excellent idea if it’s not too much trouble.

The second thing about buying at Costco is that they carry mostly above average quality goods at about the same prices at other stores. It means that you do pay for quality. If you can find items on sale outside of Costco, it’s possible that you will get a cheaper price on an absolute basis, although the quality may be slightly inferior. Shopping at Costco is really all about buying quality and saving time on finding good deals. That works out well if you’re middle or upper middle class. But if you don’t need the quality, and if your extra time cannot be converted into wage/money easily, then you could consider buying elsewhere. By the way, electronics items (especially computers and cameras) are NOT cheap at Costco most of the time. Don’t fall into their trap. Do always shop around a little.

Since people tend to over-spend when walking into stores, the best way is always to keep a buy list when you walk in, and try to stick to the list only. The list of the items should be based on what you need and what you have budgeted. That way, besides saving yourself from unnecessary buying, will also save yourself from forgetting to buy certain needed items. Save yourself from the second trip will save you both gasonline money and time.

And if you buy clothing, both Walmart and Costco have good prices, but very often, you can get good prices at Macy’s too for better styles. My wife seldom buys clothing at discount stores because she watches out for deals at the department stores.

My family has always shopped at Walmart frequently. And I can attest to the fact that every items is almost always cheaper at Walmart. We love Walmart better than Costco, only because the package size of Costco’s goods is too big for us very often.

In any case, if you don’t watch out for your own pocket, no one else will. Shop and make less shopping trips, so that you can leave more of the spare money for your own good.

While doing this new budget, I was extremely impressed by the tools provided by the credit card companies. They have made the budgeting process so much easier that you no longer need to spend hours and hours trying to figure out where your money has gone. All of them provide spending by categories and dates, so that you can easily figure out your own spending style. Although the tools will never be perfect in categorizing every bill, at least it’s a very good start.

Here are some reflections on the increase of my expenses from 2 years ago:
My gasoline cost increased from $160 to $260, mostly to due crude oil price increase and longer commute distance.

The other major increase in the total of food+dining is from dining out, even though the most (if not all) of the dining bill is less than $35 per family. This category has gone up by almost 50%. The main reason is that my kid is no longer 0 to 1.5 year old, and I can finally dine out.

My cell phone usage has gone up too from $7 monthly to about $9, due to the increase in my other side activities besides the blog. But the absolute amount is tiny in comparison to any other items. And yes, I’m still using T-mobile prepaid.

And I have also decided to simply budget for my charity spending, instead of deluding myself. It has been pretty consistent for past 5 years, and the amount of money going towards charity purpose will only go up instead of down. I have under-budgeted the charity amount somewhat, just to give myself a little financial breathing room. I think putting it at $290 monthly should be a good compromise.

My “vacation” expenses have gone up a lot because of the cost increase in international travels going back home, and also now I’m forced to take these travels ONLY during school recess.

In case you wonder, I also zero out Spousal IRA item since that is simply a “theoretical” contribution instead of a real one. My tax brackets have disallowed this contribution almost every year.

I also up $200 on miscellaneous category, which appears to be the right amount from my past 12 months of spending.

Looking forward, I expect that I will be spending more and more on children on educational purposes as they grow up.

From above, my total expenses (in white) are $5238, and my total taxes (in red) are $1661, and the savings (in green) are $2792. Assuming a household income of about $110K, or a monthly wage of $9167, my cashflow after deducting all the above items is negative $524, which needs to be deducted from savings. Please note that the above taxes are just the taxes that one might be paying at such income level, but I actually pay A LOT more (3X or more). This is mainly due to a very progressive tax system that extract a lot more taxes from any additional income beyond this level. My marginal bracket is at about 40%, instead of 20% from the above. The only problem is that it just doesn’t take much more income to quickly go to 40% marginal bracket.

The bottomline is that my net saving has dropped to $30400 from the previous $45000, after I account for the 15% discount in share purchases of my company ESPP plan. Some of the drop is due to the differences in what I’m accounting for budget, but nevertheless, the drop is significant enough to be observable from bank account balances. Unfortunately, I expect my saving levels to continue to dwindle, due to the increase in the child expenses going forward.

What’s the lesson here? I’m not becoming much less frugal, but my saving drops. Inflation accounts partially for the drop, but the main reason is as stages in life progress, your saving (if it is still positive) will be dropping to its LOWEST when your children start going to college. I’ve written an entire post (boring, but truth that you don’t want to hear) on this point to advise anyone out there to start SAVING NOW. The best time to accumulate your savings is before having any kids, especially before getting married (and after you just started working). The next best time to accumulate your savings is when your kids finish college, and before you retire. The rest of the time, one should consider oneself lucky to scrap away something left after all expenses are paid. If you have any doubts about my drawn conclusion, simply ask your parents.

The gasoline cost has been going up along with the crude oil prices. $4 seems to start to change the consumer’s behaviors from my personal observation.

From my own budget made back in 2006, more than 2 years ago, I was only spending $160 a month for gasoline. Now, for the last 4 months, on the average, I’m spending about $260 a month for gasoline. That is 62.5% increase. Certainly, part of the increase is due to some lifestyle changes including longer commute distance and I’m taking kids out more often to farther places. But majority of the increases probably come from the increase in the crude oil prices.

The prices to fill up the pump definitely are more shocking every time. However, I consider myself fortunate enough not to be affected much by the energy costs. After all, it’s $100 monthly increase, or $1200 annual increase. It’s some money, but much better than the horror stories on TV where the increase is $200 to $300 a month. Americans tend to travel and commute quite a lot. And spending time on the road is pretty much meaningless, aside the thrill from the speed.

Besides my gasoline, most of the items in my 2006 budget don’t apply anymore. My water bill has gone up by $1.5 to $26.50, and my combined bill for gas and electricity has gone up from $100 to $120. These are not a lot of increases, but they are increases nevertheless.

Next time, I’m going to re-do my budget and take a look at food from grocery bills and dining outs. There have been definitely quite a lot of increases, due to inflation and kids growing up. I’m fairly certain that the monthly increase in food is more than $100.

I guess the only upside from all the increases is my base salary increase. Unfortunately for many families out there, the increase in income barely covers the inflation cost.