Craiglist.org is probably the best free site to sell your unwanted items. It’s the internet version of garage sale. The next distant best site is kijiji.com which has been bought out by EBAY as http://www.ebayclassifieds.com/. Throughout Christmas & Valentine’s day, I have been posting some of my extra unwanted items for sale. It takes several postings & transactions to actually learn the art of selling on craiglist.

Here are some precious lessons that I have learned from my experiences of over 10 successful transactions:

1. Privacy issues: most people would post their emails and/or contact phone number within the posting. If you care about your own privacy, don’t do that. Potential buyers can always email your registered craiglist email by clicking on your post. Once you post your email and phone numbers, they get copied to so many other craiglist copycat sites. Your posts will expire after 45 days on craiglist, but on other copycat sites, it could be forever. This way it reduce the chance of getting phone & email spams too. If you really have to post a phone number, use a Google Voice phone number.

2. Do your market research: For every item that you sell, you should always think as the potential buyer, and search briefly on Amazon, craiglist, ebay, Walmart/Target, etc. for the same item. That is the only way to determine your best pricing. A good price will always sell itself. You obviously want to undercut others a little. And you should post a couple of your search result in your own ad too to convince the buyer that indeed they are getting a better price from you.

3. Pricing: if the absolute price of your item is high, it will really take a bigger effort to sell (unless it’s highly popular like ipad, Wii, etc). You have to know that people who browse & buy from craiglist probably don’t have much spare money to begin with. If they have money, most of them are extreme price bargainers. I didn’t understand this initially, but after awhile, I realize that ALL people who actually buy from craiglist always expect a price cut from your original posting price, even if the posted price is dirt cheap already. To optimize on between getting more interests versus finishing off the transaction, my advice is to post a low enough price to stir interests, and then reserve a 5% to 10% discount for price negotiation. The room should not be more than 10%, or else you may not even get any replies to your post. And give the buyer your final 5% to 10% discount to sweeten the deal or fatten up your profit margin, depending on how things go.

4. Taking a firm stand on your pricing: If you ever want to be successful in any negotiation, the first thing that you need to understand is that you need to position yourself to walk away from the deal anytime mentally. So unless you simply want to throw away your item for sale, then you need to have an attitude of not being able to sell your item when the price is not right. Why is this even important? Because there are so many craiglist trolls who would low-ball your price extremely to almost insult your common sense. If you get those low-ball offers, just ignore them. And if anybody asks for your lowest price, don’t give away all of your padded 5% to 10% room all at once.

5. Price negotiation techniques: Because Craiglist is like a silent invisible auction, there is no way for the buyer to know how many people are bidding and at what price. In a way, it’s like selling/buying a home with a given listed price. Therefore, what you need to do is to guess the buyer’s willingness and create the image of invisible bidding frenzy if possible. So if you have only one offer, you may still want to state to that only buyer that you cannot give more discount to this only buyer because “the other buyer” has given you this price already. You could risk losing out this only buyer, but it would preserve your little amount of price margins.

6. Art of advertisement: Photos are a must. Always emphasize the good points, and disclose any necessary defects that the buyer should know in the ad. Your advertisement must be honest (so that you don’t waste your time & buyers’ time besides all the legal issues). And during the entire sale process, never tell your buyers anything that could discourage the sale. I was selling a big CRT TV with HD-input at a cheap price. Because of the low price & the HD confusion with the LCD, I got more than 10 inquiries. I was over-confident and told all of the buyers as my disclosure that if they get hurt in moving the 150+ pounds of CRT, I cannot be responsible. Well, that did it, and scared away ALL buyers. I actually needed to repost my ad to sell the TV. At the end, I was still able to sell my 30+ inch CRT for about $30.

7. Prompt response: especially if your item is hard to sell. The buyer sometimes has a sudden compulsive urge. And if you don’t continue this purchasing process promptly along with him or her, the deal will simply not go through once the buying urge is gone. So in the email exchanges, not only you should be prompt, but also you would recreate buyer’s urge repeatedly by how much you cherish this item of yours but only selling it because of …(some “unfortunate” or inconvenient reasons).

8. A Big handshake to finish off: In whatever business negotiations, you should learn that only by making your customers happy, then it’s a good business. I had repeat business on Craiglist from a customer because I made him “happy” in terms of quality and pricing. I didn’t need to negotiate much at all for the second & third time because he knows that I had already “given” him the best possible price. Well, of course, I was still making a tiny amount of money (even though he still thinks that he is getting the best possible deal from me).

9. Post at the optimal time: Based on my personal experiences, I think posting on Friday and Sunday/Monday night or Saturday and Monday/Tuesday early morning should be the best. Monday & Tuesday internet traffics are always the heaviest for almost all sites. However, since it’s an internet garage sale, I usually prefer posting for the weekend on Friday. Quite often, the sale is all done before Monday, if you have priced your item correctly.

10. Don’t post too often too fast: this is just a special “feature” on craiglist. If you post too frequently (like more than 2 posts in an hour), your account can be suspended, and/or your posts will never appear. Stick to craiglist rules carefully, and don’t re-post the same item. Otherwise, you may need to find a new IP address and create a new account to continue selling. I actually found that it was quite easy to trip on craiglist’s watch for spammers.

11. Xmas season helps A LOT: one third or more of the total retail sales happens from Thanksgiving to New Year. Be part of it and go with the flow. Your asking prices can also be higher during this time (simply due to more buyers).

I learned so much from selling on craiglist that I sort of went from being a total nerd to a semi-savvy salesman. The lessons were worth so much more than any amount of money that I was making on craiglist. When my kids grow bigger, I also want them to learn these invaluable lessons firsthand by selling on craiglist. It really takes practices to be a good negotiator, and selling on craiglist is the best prep for that.

So what did I sell on craiglist? I sold PSP, Nintendo DS, baby crib, Legos, TV, several baby & kid’s toys such as tricycles. If the items were new, I made 3% to 15%. If the items were used, I recovered 40% to 100% of the original price that I paid (except the TV of course). I would say that it was a pretty darn good record.

I’m revising my last budget made in 2008 due to inflation and various changes in spending patterns. A household budget always needs to reflect the reality. Otherwise it loses its purpose.
A budget shows where the family finance situates and allows future financial planning to be possible. If you don’t even know where the money is going out, you cannot possibly know where your finance will be 5 or 10 years from now.

Reviewing the differences between the current budget versus my 2008 budget, there are several categories that have gone up. The income in this budget has increased by $25K, but I’m budgeting a lot taxes now to reflect the fact that my marginal bracket is basically 45% to 50% (even back in 2008). The other increases are the new $230 extra-curricular lessons for my sons and $140 extra in food & dining, and about $300 extra spending for my wife & kids on toys/clothes/electronics/etc. My charity contribution has increased by about 30% too. And traveling back home & vacation has gone up too by almost $800 a year.

Looking at this budget and the corresponding increases from 2008, I can identify that my kids are not frugal at all. They are basically getting every new lego boxes out there, and lots of Wii games too. I think it is time to put up some constraints. That is probably the only item that I can cut down because all other increases are due to inflation or are necessary. Looking forward, children’s educational cost will continue to go up as kids grow up.

From above, my total expenses (in white) are $6318, and my total taxes (in red) are $3893, and the savings (in green) are $3063. Assuming a household income of about $135K, or a monthly wage of $11250, my cashflow after deducting all the above items is negative $2024, which needs to be deducted from the above savings number. Please note that the above taxes are just the taxes that one might be paying at such income level. My marginal bracket is at about 50%, instead of just 24% from the above.

My net saving has dropped (again) from $45000 to $30400 in 2008 to now at about $16000 in 2011. This is after I account for the 15% discount in share purchases of my company ESPP plan. Unfortunately, I expect my saving levels to continue to dwindle, due to the increase in the child expenses going forward. My annual cashflow now is negative $24300 from above, and that is very observable in my bank’s balance. I need to constantly infuse more cash into my regular checking account to just pay all the expenses.

I’m drawing exactly the same conclusion as in my 2008 budget:

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.

I think this deal may only be valid in California. Until Dec 12 at Albertson, you can get $20 coupon for grocery for every $100 spent on all gift cards (except Visa/Mastercard & Albertson, and limit of $500 in 1 transaction). The coupons must be used before 12/24/2010. Besides that, as long as you have the credit line, there should not be much problems.

Since I used my Chase Freedom card which has 5% off for all grocery purchase (upto the first $1500), and my old HSBC card which also has 5% off but no limit, I get a total of $25 back for every $100 purchased in gift cards. More people have Chase Freedom cards. So at least, you can get 25% off for your first $1500.

Also, a couple of restaurants are having gift card sales too. Souplantation (and Sweet Tomatoes) has 1 free meal pass for every $50 gift card. Since 1 dinner is about $9.50 plus tax, you are getting a little bit more than 20% off. Panda Express has a free two item entree for every $25 gift card purchased. That’s about $6.50 plus tax. For CA 9% tax, that will be a 28% off for every $25 Panda gift card.

So far I’ve bought up $500 in Shell gasoline gift cards at Albertson, $400 in Amazon gift cards which I will spend almost right away for a HD camcorder, and another $300 in various restaurants. That’s $1200 in gift cards, or $240 in free grocery at Albertson, plus $60 in cashback on Chase Freedom card. I figured that $500 gasoline will only last me 2 to 3 months, and I’m spending $200 to $300 on dining out anyway, these gift cards would go extremely quickly. In fact, if I could find more grocery to buy at Albertson, I could easily prepaid 3+ months of my expenses. The most tricky thing about the whole Albertson deal is that $20 grocery coupon cannot be combined, and so only $20 off per transaction. But you could go to a self-checkout and simply check stuffs out for every $20 that you have in the cart.

For a little inconvenience in managing to use various gift cards, you can get 25% off on almost everything. Not a bad deal at all. Certainly, for my marginal tax brackets at about 45%, a dollar saved is two dollars earned. With $300 already saved in my pocket, I’ve got myself a $600 “salary raise”. Maybe I should work on it some more.

25% off is quite a lot. I really wonder how these stores survive.

I “participated” in the Black Friday frenzy again this year, just to survey how retail sales were going. There were many pre-Black Friday sales going on, and I thought the sale this year was going to be soft. Many stores opened very early too, and Walmart even opened 24 hours. Based on my experience at Walmart which had a 3-phase sales (midnight to 5am, 5am to 11am for electronics, etc.), I think Walmart stole quite a lot of sales this year. The 3-phase worked really good, because I found that almost ALL stores couldn’t make more sales, simply because of the capacity of the cashiers, parking lot space, and moving space within the stores. Oh yeah, almost all the retail stores that I went to were that PACKED with people & cars. The 3-phase sales at Walmart spread out different types of crowd somewhat, and many people really liked being able to get their 1st part of buying done (since no other major retail stores were opened at midnight).

Regardless, I also found that most shoppers were extremely price-conscious. I didn’t notice that, until I went to Target and found my $36 Shark Steam Mop from Walmart, priced at $45 at Target, piled up and not moved at all. Looked like everyone has done their comparison already. Yeah, and all those items that were not on sale were not touched mostly. I went to the LEGO aisle that my kids loved most. Almost all legos didn’t get sold, except very few ones that were on sale.

And I’m sorry to report to all the Apple lovers that I don’t see IPads selling. They are well-stocked in all stores, and not moving. In fact, most electronics were not selling a lot. This includes TV, blu-ray players, and even game consoles. In fact, there were so many Wifi-ready players with just an ethernet port, trying to trick buyers to buy them. No, these units won’t stream Netflix wirelessly, and will need a $80 to $130 ethernet-to-wifi adapter, after you pay some $100+ for the blu-ray players.

The only exceptions to electronics are probably mobile phones and low-priced NetBooks. Yeah, I really wanted the $150 NetBook black Friday sale at BestBuy, but it’s all gone probably within minutes when the store opened. With NetBook selling at $150 with 160GB hard drive and SD card slots, it makes triply hard to buy the most basic IPad priced at $500. Oh, I forgot, Apple is not about price, but fashion, as long as our generations stay away from the new frugal reality. Actually, I should use $400 for comparison, because TJMaxx seemed to have this item in extremely limited supply for $400 on Black Friday (if you could bust the door in time).

Anyway, I managed to get the following items this week:
1. A 3-night stay at 4-star Planet Hollywood for $56 per night after tax at Las Vegas, plus 1 free buffet pass. This was just before Thanksgiving, when you can get really good prices without much traffics. During Thanksgiving and Xmas, there are no ways to enjoy yourself, because the lines for buffet are usually 3-hours long, converting your lunch meal to early dinner literally.

2. $89.99 1TB MyPassport portable hard drive, free shipping, bought with $100 BestBuy gift card from Albertson, which gave me a $20 coupon for free grocery, and charged on my ChaseFreedom credit card for 5% cashback (or $5). So I paid about $65 before tax, when the price has gone back up to $150 now. However you can still get this item at Costco for $99.99, but you won’t get any gift card/credit card bonuses.

3. Super-Mario Wii game at Target, regularly priced at $49.99, but got a $10 gift card when bought during Thanksgiving, and I got $5 off coupon, plus 5% off charged on their RedCard (Target’s credit card). So that was like $35, not counting taxes. You could get those $5 off coupon or 10% off coupons at the checkout if you bought anything at Target, just before Thanksgiving.

4. Slave I LEGO construction set, regularly priced at $79.99 everywhere. My son asked this for Christmas, and the only reason that he wants this is that it’s got a special mini-figure Hans Solo frozen in stone. I paid about $57 before tax, because Target had it temporarily on sale for $69.99, plus there is a $10 Target coupon just for LEGO sets, and I charged it on RedCard again for 5% off.

5. $60 Brother Color Inject MFC-J410W Wireless All-in-One at OfficeMax. This one is not a deal, since you can get most wireless printers easily for less than $100 these days. And I’m buying Brother, not HP nor Canon, because the ink cartridges are cheaply available on Amazon or Ebay at less than $1 per cartridge, without me going an extra mile to find out how to refill my own cartridges. Since I won’t print a lot, per page cost matters less to me than per cartridge cost. In the past, usually I spent like $8 to $30 on a cartridge, just to print less than 30 pages, and just to find out that my $30 investment on the cartridge is totally gone and dried up after many idle months. So I think Brother should work for me better.

Today Google Voice has been made publicly available to anyone. I have just been using Google Voice for about one month with my landline, thanks to my IT friend’s invitation into the program. It has been terrific.

Here are some of the highlights in my trials:
1. It will ring ALL of your (mobile) phone numbers if you list them out. This means that you could use the Google Phone number as the main permanent contact phone number for family & friends, and you could change your mobile plans/phone numbers in whatever ways you want, and it won’t change even after you move out of the area. And Google Voice will further block any spam callings & mobile texting messages automatically.

2. It will TRANSCRIBE any voicemail messages into text. That accuracy of the transcription is simply amazing. I tested it a little bit, and it’s 100% accurate so far. Creative usage of this would be that you could use it yourself for any typing needs for blogging, writings, etc.

3. Obviously not many people write these days, but because the messages are transcribed, it becomes a searchable database, which Google excels in doing. If you receive many voicemails for your business, this will be an excellent way of handling your high volume of voicemail messages (although I’m not sure if business are allowed for using Google Voice).

4. The best of all you get everything for free, AND a free US-registered phone number. I know many of those “free-for-ever” IP phone services (like Ooma), which still require you to pay $5 to $10 every year for a valid US phone number registration (to government I believe). Guess what! Insanely profitable Google pays that for you, and you get to pick your own phone number!

5. Free conference calling capability which you don’t need to pay extra.

6. Google intended the Google Voice for mobile phones (and by the way, it doesn’t work with prepaid T-mobile phones). However, you can use it for landline too. I have been using my Google Voice number to dial around from my landline phone for FREE US domestic calls, and very competitive international calls. Calling quality is most of the time BETTER than any IP phones that you can get (Yeah, I tried and quited on Ooma already). Here is the detailed dialing instructions which you need to follow exactly once you get your Google Voice phone number:

• You MUST set up your voice mail password from your Google Voice account http://www.google.com/voice/ (after you log into your gmail obviously).
• Dial your Google Voice number (from your landline) which hopefully is a free local call if you have chosen your number wisely.
• Don’t let it ring any of your phones, and then you can press * (star) to enter into your voice mail. Punch in your voice mail password.
• Voila! You can press 2 to dial out, possibly after listening to or skipping all of your recorded messages.

Get your free & favorite phone number before they get taken now at www.google.com/voice!

I just received this email from Bing cashback program:

Dear valued cashback customer:

We are writing to notify you that the Bing cashback program will be discontinued, and the last day to earn cash back on your Bing Shopping purchases will be July 30, 2010.

Until July 30, 2010 9:00 pm PST, it’s business as usual so continue to take advantage of great offers from your favorite merchants. You can redeem all of your earned cashback savings consistent with the cashback terms and conditions and access the Bing cashback customer support system through July 30, 2011. We encourage you to redeem your cashback savings and to further support redemption, we are waiving the $5 minimum payout effective July 31, 2010….

It’s a pity to see it goes. I guess good things just don’t last forever. I have definitely enjoyed the total savings of $29 cashback on already discounted online goodies that I was able to find.

Make sure you redeem your remaining cashback in your own account before the end of July.

For those who are not aware of eye-fi, it’s an SD memory card that has built-in wi-fi, allowing automatic uploads of your photos to your PC & designated websites. I have held off buying eye-fi for the longest time since this great product first came out. Finally I yielded to my necessity of just saving 15 to 20 minutes per picture download. What I was doing for all of my pictures were simply not working. I kept buying another cheap 4GB or 8GB SD memory card when it got full (after some 1000 or 2000 pictures at 4MB per photo). But my pictures stay on SD card “forever”.

Right now you can get 4GB Eye-Fi for $44.99 – 7% off via Bing Cashback + local taxes or about $41.85 + local taxes, assuming you choose store pickup option at OfficeDepot.com (2nd link in the Bing search result). The smallest eye-fi is 2GB and it costs about $40 also. So this 4GB is a pretty good deal. I never really love anything from Microsoft, except its Bing cashback. Anything that I buy online now, I always search it through Bing cashback first, and see if I could shave off additional 5% to 10% on an already cheap price.

This price is only valid until May 1st, 2010. There is a temporary price reduction of $5, which is not even reflected in Bing search. If you want to get your hands on this, act now. But do make sure that you check the camera compatibility list at eye-fi site, so that you don’t run into any problems.

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.

Watching how Teri shops is just amazing. I thought it’s hard to find someone like my wife who really can get grocery deals thru usage of coupons. But Teri is a couple of steps beyond.

I saw the TV program for TheGroceryGame.Com. She walked out of the grocery store, paying only about $80 for some $280 worth of grocery. The numbers are amazing. But the image of her walking away with an entire shopping cart FULL, but paying only $80, is just awesome. I’m sure that you and I know how much grocery you can buy with just $80 these days. Maybe half of the shopping cart of grocery at best.

She keeps tracks of on-sale items and also her coupons. I just can’t imagine that someone would go into so many details for grocery shopping. But hey, her results are just unbeatable.

My only regret is that you need to sign up & pay at her website for specific grocery information. While I have not personally tried it, I suspect that you probably will net a positive sum by using her service.

Can you buy boxes of cereals for $1 or less in the recent month? If you can, I suppose you’re on the right track. They have been on-sale, plus that if you have the corresponding manufacturer’s or store coupon, you can get them at $1 or less. My wife just stocked up many boxes.

I guess grocery shopping can really be a game that you can win. It’s even more important with the food cost going up these days.

If you have any experiences with Teri’s website/service, please do let me know by leaving some comments. Thanks.

Frugal at 1stMillionAt33.com

P.S. I’m not affliated with TheGroceryGame.Com in any ways. I will never write paid articles. All articles are my personal opinions.

There are an increase in bankruptcy filing by corporations. It’s very important for every consumer to protect themselves in every possible way. The most important thing is don’t pay cash. Cash given to corporations is only good as long as the corporation exists.

If you buy gift cards, be sure to use them as quickly as possible. Gift cards are like loans given to the companies. The only commitment from the companies is that they will honor their gift cards before they go bankrupt. An example is the recent Sharper Image bankruptcy. They stopped honoring the gift cards.

If you pay by cash/check, it’s the same story. Aloha airline going bankrupt will not be honoring their sold tickets if they were paid by cash or check.

I know it sounds outrageous. But that’s just the way it works. Once a corporation files bankruptcy, the shareholders or the owners no longer have the control over the company. Rather, the corporation is “owned” by the bondholders, who will need to divide up the remaining assets in the bankruptcy court. If you have any cash left in the company’s control, you are just another lien holder.

To avoid these heartache, the only way is to pay by credit card. A payment by credit card is only a commitment to pay the amount of cash through credit card company. Since credit card companies don’t give these money to the companies immediately, but only extend credits to the company, there is no money exchanged (yet). Therefore, it’s a much safer way to pay. And that is the reason that credit card company has the bargaining power to allow you to dispute your payment when the service/products are not received.

With global liquidity drying, I expect that both big and small companies are going to go through a rough time for quite a while (years, I mean). Those that don’t have enough cash on hand for daily operation will need to file bankruptcy. And you don’t want to become a victim of such happening.

Best luck shopping.

Frugal at http://www.1stMillionAt33.com/2007/12/cheap-80211n-wireless-router/

Last night my wireless router is down. I had to connect my laptop directly thru ethernet physically to the wireless router, in order to get onto the internet and blog. Today’s post is therefore late than usual.

I spend some time shopping for wireless routers, and found a really good deal at target.com for the latest and greatest 802.11n router. It’s a D-link 802.11n router, and it’s only $40. If anyone is thinking of getting a new router, this N router is as cheap as other G/A/B router.

For those who are not familiar with 802.11 wireless technologies, 802.11b is the slowest. 802.11g is faster than 802.11b and the most common choice now. 802.11a is the least compatible and rare. And the new 802.11n is about 5X faster than 802.11g, and will be the next generation wireless technology for everyone’s home. Using 802.11n, one can probably transfer big files wirelessly at a very fast speed. More importantly, I believe in the next 2 to 3 years, you can watch HD TV wireless “everywhere” in your home. The speed of 802.11n is sufficiently to support multiple MPEG2 HD quality channels (not to mention that if you use MPEG4, you get more than double of that). There are still difficulties for wireless TV due to potential intermittent transmission quality. However, I think those problems can easily be solved, if you simply buffer a lot of video by combining the storage capacity of the hard disk from your PVR (personal video recording) system with 802.11n.

Anyway. It’s probably too much tech talk for someone simply looking for a cheap router. And in case if you are interested in the main companies who provide these wireless technologies, they are ATHR, BRCM, MRVL, listed in alphabetical order. I don’t advise buying any of those high-tech stocks however. But if you think of buying them, you may choose ATHR which is a very focused and strong player. Their design seems to be some 40% better in terms of cost than the competitors.

By the way, I wouldn’t worry so much about the “draft” N. 802.11n has been around for at least 1.5 years now, that I think any shipping products should be like 98% compatible with the final approved standard, if not 100%.

This is a long weekend. Hope you all had fun.

I’m buying Canon SD1000 for $150, and Panasonic Palmcorder SDR-H18 Hard Disk/SD Card Camcorder for $350, both from circuitcity.com. I’ve shopped at many places, that seems to be the best deals around, better than Costco and BestBuy, or even Fry’s electronics. You can get better prices online, but not much better.

I’ve compared the prices on electronics many times. Costco quite often disappoints me. I really expect better pricing from Costco.

Here are some examples:
1. JVC GZ-MG155US HDD 30GB camcorder at my local Costco is selling for $489.99, but the cheapest price from the internet is $329. That is $170 price difference, or some 35% of the total.
2. Sony DCR-SR82 HDD 60GB camcorder at my local Costco is selling for $599.99, but the cheapest price from the internet is $295. That is about $300 price difference, or some 50% of the total.

This is not to mention all those SD memory cards, DVD-R/+R media which are constantly over-priced by a tremendous amount. It’s really hard to imagine who are buying those over-priced products, but I guess there are simply people with more money or less time to price-shop than I do.

Certainly Costco has a very good return policy. But for such a steep price difference, I really need to think twice. There is probably a very good reason why the stock price of Costco is near its all time high at $66.80. Don’t you think that it could be due to all the shoppers paying for Costco’s bottomline?

Most people probably expect a deal when walking into Costco. I’m afraid that maybe the reverse is true.

My wife is a great bargain hunter. We get most of our clothing at Macy’s, pretty much brand names below Costco’s price. She always shops ahead of time, meaning that she will be buying next year’s clothes this year. This way, she has plenty of time to wait and shop for bargains.

Over the weekend, we got a bunch of young children clothes, each piece ranged from US$3 to about US$4. My Calvin Klein’s jacket cost about $20. The original price was about $100. This is a pretty good price, but still not a steal yet. To beat $3 a piece for children’s clothes, the only way is to go to Asia and buy them from there. Even then, this price is still cheap by Asian standards (not comparing the quality yet).

How does she do it? Special one day sale + early bird + sale items + 20% off coupon.

These prices that we got are below the regular prices at Costco, Walmart, Target, or Sear’s. The quality/brand is also better. Certainly, you won’t be wearing another Costco’s shirt.

And another trick that she uses is that she would buy items that she want before the sale is on. Within a 10-day period (for price adjustment, varies from store to store) after the sale is on, she would go back and do a price adjustment (and you just need to bring your receipt, not the items at Macy’s). This way you don’t need to rush with all other people, and still be able to get the things & sizes that you want.

Now, I only wish that I can do price-adjustment when I buy my investment stocks, . Some price guarantee for my stocks would certainly be nice.

We also went to an outlet this weekend, just for fun rather than for shopping. Normally we can’t find any deals at an outlet. Really cannot understand why people are buying there.

Have a shopping tip to share? I would certainly look forward to hear about it.

A reader sent me this article for 101 ways to save one dollar a week.

I am amazed by how many things I have actually done to save one dollar a week from this list. Yes, there are actually 101 ways to save, and I implemented majority of them. Here are just some “highlights” on my own “do”s and “don’t”.

Things that I don’t do:
11. Use cloth napkins, towels and diapers: I do buy disposable diapers. But I use cloth towels instead of paper towels.
15. Get an energy audit: I think my home is fairly energy efficient to the extent that I probably can’t squeeze more than 10% out of the current amount that I pay.
16. Enroll in cost saving programs: Nope. I did think about it, but I think my family deserves much better.
19. Install low flow showerheads: It’s probably a good idea, except that taking shower is my relaxation time.

Things that I (and my family) do:
39. Combine errands: This is a good way to save both time and money.
62. Look for sales: My wife saves me countless bucks by going through sale and clearance items. And she always enjoys the treasure hunt.
75. Catch a matinee.
77. Don’t buy popcorn: I refuse to buy way over-priced items.
90. Pay off the balance: I always pay them off whether it’s 24 cents or 24 hundreds.
97. Take your lunch to work: Why pay $5 to $10 for lunch when I can bring a healthier lunch to work?

This long list can provide very good ideas for someone who is not frugally minded. But if you get into the habit of saving, many of these things would come naturally to you. And if you think saving is being too cheap, I suggest you take a look at my definition of being frugal.

In any case, what’s good for your wallet is good for you. If you don’t save the money for yourself, who will? Are you going to count your retirement on the inheritance from your parents, money from your grown-up kids, or the so-called social security money in the “locked box”? Self-reliance and fiscal responsibility is probably a much better way to go.

Just received March issue of Kiplinger’s Personal Finance Magazine. This is a very good magazine targeted at general public. The article of How to Make a Million gave you the eight tips (only 5 are shown to respect their copyright) and 11 examples of people reaching over a million dollar net worth:

1. Follow your passion
2. Seize an opportunity
3. Exploit your talent
4. Put in the time
5. Learn the ropes (be employed first before becoming an employer in the same business)
6. etc.

After reading through the entire article, I found out that there are basically two types:

1. The crawler: save/accumulate and invest/grow their money, given enough time.
2. The passionate: yeah, somehow some people find their way into their niches. But ALL of them love what they are doing, whether it’s side-business, hobby, or their job.

Got the message? If you are both, the chance of you making to a million will surely increase more.

If you cannot love what you are doing on a daily basis, you cannot be successful in doing that. Success in what you are doing won’t necessarily bring you a great fortune. But without a success, it is pretty sure that you won’t get to a great fortune. And the other way is obviously taking small steps at a time, saving/accumulating wealth. Given sufficient amount of time, you will get to a big fortune.

I can attest to you that I’m both. Definitely has helped me to reach a bigger fortune sooner.

Posted by “Frugal” at My 1st Million At 33.com

]]> http://www.1stMillionAt33.com/2007/02/tips-on-how-to-make-a-million/feed/ 3 http://www.1stMillionAt33.com/2007/02/get-15-off-by-using-paypal/ http://www.1stMillionAt33.com/2007/02/get-15-off-by-using-paypal/#comments Thu, 15 Feb 2007 14:01:22 +0000 Frugal http://www.1stMillionAt33.com/2007/02/get-15-off-by-using-paypal/

Don’t miss this deal if you want to buy something online. Here is the link to the deal. You will need to spend at least $30 excluding shipping charge, and obviously have a paypal account. I plan to purchase some stock newsletter.

Enjoy.

]]> http://www.1stMillionAt33.com/2007/02/get-15-off-by-using-paypal/feed/ 6 http://www.1stMillionAt33.com/2007/02/easy-grocery-shopping-at-mygrocerydealscom/ http://www.1stMillionAt33.com/2007/02/easy-grocery-shopping-at-mygrocerydealscom/#comments Thu, 01 Feb 2007 12:01:07 +0000 Frugal http://www.1stMillionAt33.com/2007/02/easy-grocery-shopping-at-mygrocerydealscom/

I came across MyGroceryDeals.com, a website that helps you search through the weekly deals at your local supermarkets. No longer do you need to go thru every flyer from every grocery store, and look through them. If you know what you are looking for, it’s easy.

Here is the comment from the site owner:

Mygrocerydeals.com is a free service that allows consumers to go online, do their grocery pre shopping based on advertised grocery flyer specials, look at nutritional information, create their shopping list and then head out to their selected store(s) with list in hand. We have recently mapped 50,900 zip codes into our database and then lined up the grocery markets and local stores along 4,400 county lines to make a match. So members really do see the deals in stores in their neighborhood only. We are a free site and intend to continue it as a free site. Our goal is to make it easy for our members to compare the advertised flyer deals at their local stores so they can save time and money. We are continually updating our site in respect to products and stores…we are not perfect in having all the information that consumers want, but we are trying hard. We encourage members to ask their local grocery stores to contact us with their advertised specials so we can incorporate them into our database. We are also continually updating our nutritional information on listed products so members can check ingredient information before heading out to their favorite stores. “Compare flyer deals and plan healthy meals” is what we are striving to offer our members.

Check it out. My only complaint is that you need to create a free account by using an email address. I have made sure that I didn’t get any grocery-related spam emails for 2 months before writing this article, since I don’t want to introduce anything that will spam your email. The login is a bit of hassle, but once you’re in, it’s easy.

P.S. I’m not affliated with nor paid by MyGroceryDeals.com. Only thought that this may be a tool to make finding deals in grocery shopping easier.

]]> http://www.1stMillionAt33.com/2007/02/easy-grocery-shopping-at-mygrocerydealscom/feed/ 4 http://www.1stMillionAt33.com/2007/01/guess-where-i-bought-my-diamond-engagement-ring/ http://www.1stMillionAt33.com/2007/01/guess-where-i-bought-my-diamond-engagement-ring/#comments Fri, 26 Jan 2007 12:01:35 +0000 Frugal http://www.1stMillionAt33.com/2007/01/guess-where-i-bought-my-diamond-engagement-ring/

AskMr.CreditCard.com sent me a post on buying diamond ring at Costco. And he asked me for my comments on buying diamond rings at Costco or at Tiffany. I definitely think it’s okay to buy the diamond ring from Costco. Well, guess where I bought my diamond ring for my wife? I bought it from an internet site! Back in 1997!!

Obviously I am not that trustworthy of everything I see, read, or buy from the internet. So here is the procedure that I followed, which I believe to be safe enough for me to do such transaction:

1. ALWAYS use credit card or Cash on Delivery (COD) for internet transactions if possible, even if you need to pay extra 2%. This is true, especially for big amount transaction. The added cost far outweighs the consumer protection that comes along with credit cards. I will consider alternative payment methods only if the site is extremely well-established, such as Amazon.com, Buy.com, etc. MOST of the Ebay frauds occurred because people use checks instead of credit cards for transactions.

2. After you do all of your comparison shopping in Carat, Clarity, Color, Cut, and Certificate, make sure to check out the merchant at www.bbb.org for ANY unresolved issues or bad records. I will NOT do any business with any companies that doesn’t have a clean record for jewelry-related products. There are a few kinds of business that may get more consumer complaints than usual due to huge amount of transactions (it’s percentage of complaints that count). Those are exceptions though.

3. You should buy a bare diamond stone rather than a diamond ring if buying from internet. The reason is that you should get your diamond inspected by a local independent gemologist. For a thorough inspection, the diamond must be unmounted from the ring. You should always buy a certificated diamond if it is bought at internet. That way, you can match your diamond with your certificate specification. Your gemologist can also show you how it matches up in the clarity spec under a microscope. You should have him or her walk you throught the spec of the diamond. And most important of all, before you leave from gemologist, make sure you are taking your diamond home, and not a swapped stone. I think you could probably ask the gemologist politely to make the microscope inspection as the last (repeated) step, and/or diamond-test the stone before you leave. You can test the diamond-tester by bringing in non-diamond rings and/or anything else. Use the diamond tester on the non-diamond materials and you should get a negative response. And if you have some real diamond materials, you should get a positive response when testing it. Make sure that the diamond tester is not a fake one. When doing the tests on diamond tester, you should borrow the diamond tester and personally perform the test yourself. Unless that diamond tester is a fake one with remote controllability, you won’t be cheated. If you don’t know what a diamond tester is, go to a local jewelry store for some comparison shopping and personal education, and they will be more than happy to show you how the pen-like diamond tester works.

4. And then, you will need to choose a ring and get it mounted too. When you find a jewelry store that will do it for you, you should make sure that the person who is mounting the diamond is at the OPEN & CLEAR (behind the transparent glass wall) location where you can personally watch him mount the stone. Again, you want to leave with your diamond, not a fake. Diamond-test your diamond ring again to make sure you’re leaving with a diamond. Again, don’t forget to test their diamond tester yourself with the same procedure above.

5. After that, you should go back to your gemologist again for inspection, mounted or unmounted. The best is to negotiate a deal for the dual inspections that you will be requesting from the same gemologist.

6. Yeah, a lot of work to save big money. You’re done! Well, hopefully that your darling will like what she sees, or better yet, talk with her first about your purchase process.

I followed pretty much the above procedure literally in 1997. That was the only way that I could trust what I bought. I paid about $5800 for a 1.03 carat, H color, VS2 clarity, pretty good cut, and GIA certificated diamond. Yeah, and I didn’t need to pay sales tax. I also paid about $50 to $80 for the gemologist. The ring that I got probably cost less than $300 including mounting only because it had two smaller low-quality side diamonds.

I think the price went down a little bit by maybe some $500 after a couple of years of even more vehement competitions on the internet. But I can tell you FOR SURE that you can definitely get a better deal than Costco if you buy your diamond from other big “wholesale” diamond sites.

Actually, so far in my life, that $5800 is the most expensive luxurious item that I’ve ever bought. I felt so uncomfortable about such purchase that I thought it could only be right if I donated some $2500 to ChildReach in 1998. I can and could never justify such a purchase based on my personal belief. ChildReach actually sent a representative who visited sponsors around the country to pay a visit to me & my wife. We paid for her $5 lunch when she visited us. She said she was surprised to see young and “generous” people. But I was too shameful to tell my wife and ChildReach’s representative about why I donated the money.

I’m not sure if my wife would understand, or others. I feel okay if I’m not donating big money when simultaneously I’m not spending big amounts on non-necessary items on myself or my family. But I consider diamond rings or any jewelries as non-necessary items.

In any case, I hope my diamond buying tips would be helpful to you. There had been so many diamond sites popped up after 1997 that I cannot really tell you which would be the best sites. I believe back in 1997, the better sites were named something like diamondcutter.com or wholesalediamond.com, or something like that. But whatever sites you’ve chosen to do business with, you MUST check it out at bbb.org, and get some references, and/or even their banking reference.

Well, the most important thing is that my wife really liked her diamond ring. It won’t do you any good obviously if your girlfriend insists on buying from Tiffany. But maybe you can tell her that Frugal also bought it from internet! My own personal experience is that once they see the ring and with the certificate, they fall in love, and won’t really complain.

P.S. Both my wife and I think it’s okay to get a diamond ring from Costco. Why? Every diamond is truly kind of unique. But once you classify them based on the 5 Cs (or the more common 4 Cs + certificate), they are really just another type of commodity. It makes absolutely no visible or even invisible difference between the two same quality diamonds if they are cut in the same way. Certainly, Tiffany sells most ideal cut diamonds. But you can also get ideal cut diamonds elsewhere. Make sure the ideal cut definition is the same if not very close. Some sites will have a more loose definition so you will need to get the exact dimensions of table width, girth, depth, etc. to compare to the ideal cut dimensions.

]]> http://www.1stMillionAt33.com/2007/01/guess-where-i-bought-my-diamond-engagement-ring/feed/ 19 http://www.1stMillionAt33.com/2007/01/switching-to-t-mobile-prepaid/ http://www.1stMillionAt33.com/2007/01/switching-to-t-mobile-prepaid/#comments Sat, 13 Jan 2007 10:01:50 +0000 Frugal http://www.1stMillionAt33.com/2007/01/switching-to-t-mobile-prepaid/

I don’t really use my cell phones that much. Since Cingular wireless is stopping the Free2Go service in March, and both of my phones are expiring, I have decided to switch to T-mobile prepaid. My phones still had $44 and $13 dollars credit near expiration. I have been simply rolling over the minutes, and spent just about $3 a month.

I’m posting this on a Saturday because I just found out that today is the last day for you to get $10 off on $50 T-mobile refill card in Target stores. And if you spend $80+tax for a total of $100 refill, you can become a Gold Reward member. A gold reward member just need to add $10 every year to roll over the minutes if you are not using cell phones a lot. Even if you do, it’s just 10 cents per minute (anytime minutes).

Also, on T-mobile home site, the before Xmas deal is back again. You can get a basic Nokia 6030 phone (which has speakerphone, tri-band, etc) for about $60, free of shipping, minus $30 rebate, and $10+$25 airtime credits or refill card. So that’s about a free phone plus $5 in your pocket before tax. Or you can get a camera phone with 4X zoom for about $50 more.

Now if you do decide to get this now, you could get the refill cards first at Target (which can be returned if you change your mind) before the end of Saturday, and order the phones online or by phone at T-mobile home site. These phone deals are not available at stores.

Between T-mobile & PagePlus Cellular from Verizon, I think T-mobile is much more widely used and cheaper for 3+ years for a moderate usage, assuming that they don’t change the good deal after a year or two.

]]> http://www.1stMillionAt33.com/2007/01/switching-to-t-mobile-prepaid/feed/ 23 http://www.1stMillionAt33.com/2006/12/almost-free-1gb-usb-20-flash-drive/ http://www.1stMillionAt33.com/2006/12/almost-free-1gb-usb-20-flash-drive/#comments Fri, 15 Dec 2006 12:01:38 +0000 Frugal http://www.1stMillionAt33.com/2006/12/almost-free-1gb-usb-20-flash-drive/ =$50). Since my previous rebate with Kingston has been approved, I assume that their mail-in rebate is pretty solid. [...]]]>

It cost me just $3.88 for 1GB Flash Drive.

Before mail-in rebate from Kingston, it’s $30 before tax. After mail-in rebate, I would only pay sales tax. This is with $20 Google Checkout bonus (for order >=$50). Since my previous rebate with Kingston has been approved, I assume that their mail-in rebate is pretty solid. So I will be just paying $3.88 for 1GB Flash Drive.

Here is the link:
http://www.buy.com/prod/Kingston_1GB_Data_Traveler_USB_2_0_Flash_Drive/q/loc/101/202743517.html

Be careful with the mail-in rebate receipt that you need to provide. The receipt MUST be printed from Buy.com website. Here is the only way that you should follow in order to print the receipt (or else you won’t get your $30 rebate):

1. After you use the Google Checkout, Google will send you an email. Ignore that email. Wait for a little while for Buy.com email notifying your order. It will be mailed from support, and the subject says Buy.com – Thanks for your Google Checkout order!.
2. Click on the first link in the email. It should be https://secure.buy.com/corp/support/guestordersearch.asp?who=google.
3. Fill in the all the info on that page. The order number is at the bottom of the same email from Buy.com. Then click on Find Order button.
4. You will be directed to the page where it shows the order. Scroll to the right and bottom. Click on “View Receipt” button.
5. Viola. Now you will get to the receipt page. Print that page. As far as I know, NOTHING else you provide will be recognized as a valid receipt. So it’s extremely important to get this sale receipt correct.

And remember to take advantage of Google checkout at all kinds of merchants. You can buy Books, Music CD, electronics and get $10 off per order (>$30), and $20 off per order (>$50) only at a few sites. Here is the list of all the merchants that participate in Google Checkout.

Happy Holiday Shopping!

]]> http://www.1stMillionAt33.com/2006/12/almost-free-1gb-usb-20-flash-drive/feed/ 3 http://www.1stMillionAt33.com/2006/11/earn-airline-travel-vouchers/ http://www.1stMillionAt33.com/2006/11/earn-airline-travel-vouchers/#comments Wed, 15 Nov 2006 12:01:17 +0000 2million http://www.1stMillionAt33.com/2006/11/earn-airline-travel-vouchers/

As a guest writer, 2million blogs his personal finance from 2millionblog.com, and is recording his journey to financial freedom. Please check him out at his site for more goodies.
——————————-

This week I am on a business trip for work and have already earned a $250 AA travel voucher and a $10 meal voucher from American Airlines. All I had to do was volunteer to get “bumped” off the flight to my destination and catch the next flight that was 2hrs 7min later. In effect I earned over $100/hr by sitting around and eating $10 in free food. I am hoping I might be able to pick up one more travel voucher on my return flight to Raleigh.

This is a really easy way to save money on airline tickets regardless of how often you fly. Airlines regularly offer travel vouchers for those passengers they can shuffle off flights that the airline has overbooked. For those that know the system, this can be a lucrative way to get big savings for little time or effort.

Let me start by saying I am not an expert on earning these travel vouchers and encourage everyone to add other tips in the comments below.

Rules of Thumb for Getting Travel Vouchers
You have to schedule your trip to create opportunities to get bumped by the airline. This means:

1) When you are planning a trip I try not to tightly plan things close to arrival/departure times. Its a good practice anyway what traveling at the mercy of the weather and various airport delays, but its even more important if you want to try and earn travel vouchers.

2) Don’t catch the last flight of the day if you can help it. I always try and book the second to last flight of the day. This way if they ask for volunteers to “bump” off the flight, there is still a flight to my destination that same evening and it won’t inconvenience me more than a couple of hours.

3) Book on flights that are already almost full or during typical busy times. For instance, there are alot of Friday or Thursday late afternoon, early evening flights that are booked from business travelers headed home for the weekend.

4) Try and keep your hops to a minimum. There are exceptions, but the more “hopping” you do the harder it will be to take advantage of getting bumped from any flight other than your final destination flight. For example, if your flight is Atlanta->Chicago->St Louis->San Jose then really the only hop you would probably want to get bumped from is your St Louis->San Jose flight. If you got bumped from any of the others, it would be very hard to arrive at your destination in reasonable proximity to your planned arrival.

5) The fewer in your traveling party the more opportunities you can take advantage of. The airline is typically looking for 1-3 people to get bumped depending on their overbooked situation, so the less people in your group usually means you will have better chances. However, the more people in your party, the more travel vouchers you can earn per bump. If you were traveling with 2 other people, you could earn $750 in vouchers compared to $250 for just yourself.

6) It doesn’t work every time, but for every trip you take you basically have 2 opportunities, the flight to your destination and the return flight to your origin. Create your travel plans around these flights to maximize your opportunities.

How does it work?
Typically the airline attendant will just announce 15-30min before the scheduled boarding time that they are looking for volunteers to get “bumped” and what they are offering in terms of compensation (aka travel vouchers, meal vouchers, extra miles, etc). Then you just go up to the station and tell them you are willing to get bumped.

Other Tips:
-I try and make sure I am at the gate as early as possible so I can hear if they need volunteers.
-I’m too lazy to do this, but I have seen people just approach the flight attendants and ask them if they are going to need anyone to get bumped so they won’t miss the opportunity.
-Get familiar with the flight schedules before your actual trip so you know in advance your booked flight times and the flight times of later flights. This way you won’t need to think about the impact and whether you want to get bumped if they need someone.
-Make sure they can give you a confirmed seat on the next flight out; otherwise they could leave you hanging around alot longer than you thought.
-Ask for more. I don’t know if it works, but if they desperately need someone, I would bet an airline might give you more then they announced such as extra airline miles, larger travel voucher, meal voucher, etc.
-Keep in mind the travel vouchers are typically good for 1 yr after issue. If you or someone you know isn’t taking another trip in the next year, this could be a waste of your time.

Additional Info:
Info on bumping and travel vouchers.
FAQs on getting bumped.

]]> http://www.1stMillionAt33.com/2006/11/earn-airline-travel-vouchers/feed/ 2 http://www.1stMillionAt33.com/2006/11/effective-budgeting-tracking-a-budget-part-3-of-3/ http://www.1stMillionAt33.com/2006/11/effective-budgeting-tracking-a-budget-part-3-of-3/#comments Fri, 03 Nov 2006 12:01:19 +0000 BinaryDollar http://www.1stMillionAt33.com/2006/11/effective-budgeting-tracking-a-budget-part-3-of-3/

This is a guest article from Henry @ Binary Dollar. He is a developing writer interested in technology and fundamental personal finance. He also enjoys anything involving clapping.

Tracking what you spend is the most important component of budgeting. I couldn’t build my budget without tracking. I can’t gauge how accurate my budget is without tracking. Here are a few things I do to keep track of what I spend.

Get receipts when possible. Take the receipt and put it in your wallet. Don’t keep it in there to rot.

Keep a pen close. I can’t always get a receipt for something. I keep a pen handy to write down expenses when I couldn’t get a receipt.

Update your spreadsheet ASAP. I have a bad memory and I hate having a fat wallet. Empty your expenses into your computer when you get home so you can throw away the receipts from your wallet. Note: Anything more than 2-3 days old probably won’t get recorded.

Track everything no matter how small. This is especially important if you’re just beginning to track your spending. If you start to make little exceptions, you’ll start making bigger exceptions more frequently.

Purchase what you’ve planned in the beginning of the month. This assumes that you’ve got a little cushion of money. I like to pay rent and utilities, buy plane tickets, fill up on gas, and buy groceries in the beginning of the month. It gives me a more accurate picture of what I have left. More importantly, you get those expenses out of the way early in the month so you don’t have to deal with it later.

Track spending for at least 30 days. Tracking your spending is like exercise. It’s useless unless you do it consistently. Better yet, track it for 3 months. Tracking for 3 months or more will allow you to build a more accurate budget.

Keep your budget sheet with you at all times. I keep an excel spreadsheet (Pearbudget) on a USB stick so I can add an expense when I’m at home, at work, or traveling.

This is the last in a series of 3 budgeting articles. I hope you enjoyed reading them as I did writing them. Big thanks to Frugal here @ 1stmillionat33. Thanks for the exposure.

The other 2 articles:

Effective Budgeting: Why Budget? (Part 1 of 3)
Effective Budgeting: Building A Budget (Part 2 of 3)

]]> http://www.1stMillionAt33.com/2006/11/effective-budgeting-tracking-a-budget-part-3-of-3/feed/ 4 http://www.1stMillionAt33.com/2006/11/muffin-calculator-for-little-savings-that-goes-a-long-way/ http://www.1stMillionAt33.com/2006/11/muffin-calculator-for-little-savings-that-goes-a-long-way/#comments Wed, 01 Nov 2006 12:01:52 +0000 Frugal_Duchess http://www.1stMillionAt33.com/2006/11/muffin-calculator-for-little-savings-that-goes-a-long-way/

This article is from Frugal Duchess. She writes a weekly column in Miami Herald, and had been a stringer for People Magazine. In the past, she worked at Institutional Investor’s newsletter division in Manhattan, covering IPOs, M&As and LBOs, CMOs and the rest of the financial alphabet.
I hope you will enjoy her frugal tips from this post.
—————————————————–

Hugh Chou, a systems network administrator at Washington University in St. Louis, is a hero in many financial circles for his free online devices: The ”Coffee Calculator,” ”the Lunch Savings Calculator” and the “Gas Guzzling Calculator.”

Here’s a link to Sharon’s Muffin Calculator, designed by Hugh for this blog.

He calculates how much our little expenses cost on an annualized basis and how much we would earn if those funds were stashed in a long-term investment account.

I recently chatted with Chou and learned a lot. Ten years ago, he created a website that contained an online mortgage loan calculator. That service led to requests for more calculators from consumers and mortgage companies.

His calculators — dozens of them — are featured on his site, www.Hughchou.org. Click on Mortgage and Other Calculators.

Here’s how the coffee calculator works: Plug in the cost of a cup of coffee, plus tax and your regular coffee-break snack. Input the number of cups you consume each working day. Based on $3 per day over a typical work year of about 250 days, the coffee calculator figures that your coffee break costs $750 a year.

Homemade coffee, Chou calculates, would cost only about 25 cents a day and over the period of a year, home-brewed coffee would save you $687. If you invest that amount in a 6 percent investment vehicle, and continue to do so on an annual basis, you would amass $9,061.80 in 10 years.

Chou’s calculators enable you to plug in various dollar amounts, numbers of coffee cups and even the investment yield.

”I’ve always been pretty frugal,” Chou told me. ”I’ve always brought my own lunch.” Watching colleagues buying lunch each day led to Chou’s Lunch Savings Calculator. The daily cost of a homemade lunch ($1.50) when compared to $5 takeout produces a savings of $875 a year. Over a 10-year period, skipping the $5 daily takeout could generate $11,000, based on a 5 percent annual yield.

Chou’s Gas Guzzler Calculator lets you compare how much you’d save if your next car merely sips gas instead of guzzling it. You can plug in your car’s miles per gallon and your commuting distance.

By the way, Chou donates a hefty portion of the proceeds from his calculators to charity. A portion of the donations also support his free site.

Here is his donations page.

]]> http://www.1stMillionAt33.com/2006/11/muffin-calculator-for-little-savings-that-goes-a-long-way/feed/ 2 http://www.1stMillionAt33.com/2006/10/effective-budgeting-building-a-budget-part-2-of-3/ http://www.1stMillionAt33.com/2006/10/effective-budgeting-building-a-budget-part-2-of-3/#comments Fri, 27 Oct 2006 12:01:40 +0000 BinaryDollar http://www.1stMillionAt33.com/2006/10/effective-budgeting-building-a-budget-part-2-of-3/

Why did budgeting fail me?

1. It was too hard to manage. I tried using MS Money and other complex methods to get my finances in order. I kept a budget for 2 days before quitting. It took too long to manage everything. When I bought a can of beans from the store, I would have to input the following information:

• Did you pay with credit, debit, cash, or check? Credit.
• Which card? Amex.
• What date did you buy it? Um. Yesterday.
• What catagory did this purchase fall under? Food.
• What sub-catagory did this purchase fall under? Eating out? Groceries? Yeah. The last one.
• What was the sales tax? ARG. Food doesn’t have any.
• Where did you buy it from? Who cares?
• How many did you buy? A MILLION. LEAVE ME ALONE!

2. It was too inaccurate. There was always some emergency and I would end up going over what I expected. Way over. This was discouraging enough for me to throw most of my budgets away. What’s the point of having a budget if I’m just going to spend more than I thought anyway?

I needed to find something easier. I wanted to do the least work possible. Here are some of my main guidelines that have allowed me to keep a budget for the past 3 months.

Binary Dollar’s Budgeting Guidelines:

Do NOT budget more than you earn. This includes your income, rent from tenants, a conservative estimate of earned interest, etc. The ideal pool you should start with is 90% of your take-home pay for a little bit of added cushion.

Subtract your fixed expenses first. Pretend that you pay your utilties, rent, and savings at the beginning of the month. Even though the food bill changes each month, I subtract a rough estimate as a fixed expense. I don’t want to run out of money and go hungry. Your savings should be a fixed expense too. Don’t fall into the trap of saving what’s “left over” at the end of the month. There won’t be anything.

Things that I usually subtract from a month’s pay:

• rent – $500
• utilities (rough estimate) – $100
• food (rough estimate) – $130 (Are you calling me fat?)
• savings (this could be emergency funds, ira, etc) – $500
• car (rough estimate) – $40.00

Strip the catagories. Figure out what’s important for you to keep track of. You don’t need 75789347598374 catagories in your budget.

I’m not worried on a day to day basis about how much of my savings goes into an IRA, money market, or some mutual fund. I lump it into a catagory called “savings” on my budget sheet.
Use the bare essentials according to your tolerance of complexity and your priorities. I have fairly broad catagories. Here’s my list:

• rent
• student loans
• gym
• utilities
• car
• groceries
• savings
• spending

Evolve your budget. I used to write my budget and then try to spend according to it. I had it backwards. I had to spend and THEN write my budget. My budget did not become accurate until I started tracking my spending. My budget changed quite a bit in the beginning. It took me 3 months of tracking my spending to evolve my budget. What I thought I spent and what I actually spent were different. Don’t keep your budget the same month after month if it isn’t working. Tracking strategies will be covered in the next article.

—
Henry, who contributes to the blog Binary Dollar, is a developing writer interested in technology and fundamental personal finance. He also drank a gallon of milk in 1 hour when he was in college.

]]> http://www.1stMillionAt33.com/2006/10/effective-budgeting-building-a-budget-part-2-of-3/feed/ 11 http://www.1stMillionAt33.com/2006/10/a-good-deal-for-the-week-of-oct-21-28-2006/ http://www.1stMillionAt33.com/2006/10/a-good-deal-for-the-week-of-oct-21-28-2006/#comments Thu, 26 Oct 2006 16:20:48 +0000 Frugal http://www.1stMillionAt33.com/2006/10/a-good-deal-for-the-week-of-oct-21-28-2006/

I just bought a 2GB Secure Digital (SD) memory for about $19, made by Kingston. The 1GB SD memory is about $9, also made by Kingston.

The original price for 2GB SD is $37.95 before tax, with $9 mail-in rebate, using $10 Google checkout reduction, and $0 for shipping. The rebate will expire on Oct 28.

The deal for 1GB SD is $30.95 before tax, with $13 mail-in rebate, using $10 Google checkout reduction, and $0 for shipping.

Hurry before the rebate expires. Kingston is a pretty good manufacturer.

Here is the link to 2GB SD:
http://www.buy.com/retail/product.asp?loc=101&sku=202743332

Here is the link to 1GB SD:
http://www.buy.com/retail/product.asp?loc=101&sku=202743519

If you have missed the deal, don’t worry. Go to the Google Checkout site list and just start shopping for any combined order more than $30. As far as I can tell, you can use Google Checkout for $10 REPEATEDLY. If you can manage to buy things just for $30, you can get 33% off in every order. Not everyday you can get such discount. Plus that if you scroll down on that page all the way to bottom, you can register any of your Citicard and get $5 additional off on your first order. And I am guessing that you can register multiple of your Citicards, and get multiple $5 off, . Am I too sleazy?

]]> http://www.1stMillionAt33.com/2006/10/a-good-deal-for-the-week-of-oct-21-28-2006/feed/ 1 http://www.1stMillionAt33.com/2006/10/what-my-father-taught-me-about-business-endless-fools/ http://www.1stMillionAt33.com/2006/10/what-my-father-taught-me-about-business-endless-fools/#comments Sat, 21 Oct 2006 12:01:08 +0000 Frugal http://www.1stMillionAt33.com/2006/10/what-my-father-taught-me-about-business-endless-fools/

Unlimited number of fools? That’s not even political correct. This is indeed the ugly part of the business, unlike Part I which is all about delivering good values and services to customers. Unfortunately, it is somewhat true.

My father taught me about this to warn me about the existence of unscrupulous business. In his words, “you (the business) will not run out of fools for you to cheat or take advantage of. And do not become one of the fools.” One must wonder how such business continues to exist with its unscrupulous practices. But as my Dad has observed how some people do buisness, literally, they just don’t run out of fools.

One of the best examples is in mortgage business. Between CountryWide and Mortgage Capital, there is about $5000 difference in the amount that they charge customers (for fixed loan terms). However, CountryWide certainly is not running out of customers. What is the lesson here?

For businessman, it means that you do NOT need to be the most competitive in price in order to compete (although the best businessman should always try to deliver the best values to his/her customers according to my Dad’s other teaching). The market price of a certain product or service in the business world is really a myth. Rather, there is a price range for all kinds of transactions and all kinds of customers. At the different price points within the price range, the demand/supply curve has a delicate balance for every supplier and customer. The amount of potential customers may be determined by the price, location, reputation of the business, etc. Therefore, you actually do NOT need to be the most competitive in price.

Certainly, as soon as you go away from the lowest possible price point, you are essentially putting customer’s money into your pocket. And in the mortgage business, or any business where the suppliers attempt to confound the customers in the true price that they are charging either by direct lies or confusing charges (just look at the number of entries in your escrow closing statement), the room of additional profits tend to be quite big. Now, the only way for you not to become a big fool is to understand how they charge their service and understand each item that they charge you.

Another example of such business is jewelry stores, selling diamonds using 5 Cs: carat, color, clarity, cut, and certificate to give you the maximum amount of confusion. They certainly will talk about your budget for your diamond, and then move your price point on their 5 Cs multi-dimensional product terrain to give them maximum amount of gross profits, while apparently providing your a “value” buy.

The bottom line is when you find a business that is trying its best effort not to give you any possibility of doing apple-to-apple comparison, you should know what it is upto. If a business makes its charges and pricing exceedingly clear, you can be certain that it is trying to give you a quick apple-to-apple comparison because the business is very confident in its ability to provide you the best value.

My advices for the customers: be a smart shopper, and understand the product/service. Do not listen to the salespeople, but instead do your homework on a fair comparison.

My advices for the business owners: although you do not need to charge at the lowest price point, know that your customers are your lifeblood, not suckers. Treating them good in the long term always pay off. Business is based upon mutual trust.

]]> http://www.1stMillionAt33.com/2006/10/what-my-father-taught-me-about-business-endless-fools/feed/ 2 http://www.1stMillionAt33.com/2006/10/random-good-and-bad-deals-for-oct-9-13-2006/ http://www.1stMillionAt33.com/2006/10/random-good-and-bad-deals-for-oct-9-13-2006/#comments Sat, 14 Oct 2006 12:01:36 +0000 Frugal http://www.1stMillionAt33.com/2006/10/random-good-and-bad-deals/

A short post for recent bad deals for morons or people who have too much money to waste, and some goodies:

Good deal
• Bank of America is providing free online stock trades for any clients who deposit $25,000 dollars, reviving the www.freetrade.com once provided by Ameritrade.
• AlexsCoupons.com providing coupons to over 1000 online stores. It seems to be a quite popular site with quite high alexa ranking. About 7000-10,000 people everyday visit Alex’s Coupons to save thousands of dollars. Furthermore, the site owner recently donate $2000 to Starlight Starbright Children’s Foundation. Quite a honorable deed, and probably not the first time from what I can find.
Bad deal (at CountryWide Financials)
Mortgage quotes on Thursday Oct 12, 2006, for refinancing from CountryWide. 30 year fixed at 6.25% rate, 1.0% loan point for 70% LTV (Loan-to-Value) ratio. 15 year fixed at 6.00% rate, 1 loan point for 70% LTV ratio, with unspecified lender fee (didn’t bother to ask).

This compares to Mortgage Capital Associates., providing 30 year fixed at just 0.75% loan point with an okay lender fee of $1250 (was $950 3 years ago, lowest I’ve seen is about $650) at an interest rate of 5.875%. The 15 year fixed is at interest rate of 5.375% of 1.0% loan point.

By the way, paying loan point is usually a stupid idea unless you intend to keep the loan (and not selling your property) for very long time. I’m quoting 1.0% point only because CountryWide by default charges 1.0% point to fatten their pocket while at the same time advertising a seemingly “competitive” rate. Compared to Mortgage Capital, 15 year fixed at CountryWide is 0.625% higher in interest rate (or 11.6% higher), and 30 year fixed is about 0.375% higher (or 6.4% higher). Please do remember that every 1/8 of interest rate worth a LOT more for a longer term loan. That’s the only reason that 30 year fixed seems to have less premium, while in reality, you are probably paying the same 11.6% extra over Mortgage Capital. In terms of actual current dollars (in points), you are probably paying about $5000 for a $300K loan at CountryWide comparing to Mortgage Capital. And all those $5000 goes into CountryWide’s pocket, instead of going towards your retirement or college fund. Maybe they think some 10 (?) hours of loan processing is worth at $500 per hour rate.

You can comparison-shop further at bankrate.com, but do pay attention to the Lender Fee that they will charge (the rest “should” be third-party fee), and sanity-check the customer service experiences at www.bbb.org, and by Google Search with “XXX complaint” or “XXX problem”.

P.S. I personally have not applied to any of the above services. They are merely price quotes, and do not reflect my endorsement to their customer services.

]]> http://www.1stMillionAt33.com/2006/10/random-good-and-bad-deals-for-oct-9-13-2006/feed/ 13 http://www.1stMillionAt33.com/2006/08/do-you-carpool/ http://www.1stMillionAt33.com/2006/08/do-you-carpool/#comments Fri, 11 Aug 2006 19:03:28 +0000 Frugal http://www.1stMillionAt33.com/2006/08/do-you-carpool/

I just started carpooling with another work colleague a few months ago. I drive on Monday/Wednesday, while my partner drives on Tuesday/Thursday. Yeah, there is no rules in the book that says 1stMillionAt?? cannot carpool. Besides splitting the cost of gas money, there are a few other advantages & disadvantages from my own experience:

Advantages:
1. Not only car-related expenses (besides insurance) are cut in half or whatever factor based on the number of people doing carpool, the rush hour stress is cut in half too. I never feel so good about not needing to take the driving wheel, and just take a quick nap.
2. Toll road cost can be more reasonable if there is any.
3. You can drive the in the carpool lane. Save a lot of time during traffics hour.
4. Tell your boss that your carpool partner is leaving, and he can understand to let you go.
5. A much regular work schedule, instead endless working hours.
Disadvantages:
1. If you need to go somewhere else during lunch break, you cannot, unless you are the driver that day.
2. For family emergency, you may need to come up with some extraordinary arrangement.
3. A little time overhead & inconvenience is required to meet to leave for work and come back home.
4. That’s how I caught my cold this week, from my carpool partner. Next time I will stop carpooling when either of us get sick.
]]> http://www.1stMillionAt33.com/2006/08/do-you-carpool/feed/ 3 http://www.1stMillionAt33.com/2006/08/two-must-do-money-saving-tips/ http://www.1stMillionAt33.com/2006/08/two-must-do-money-saving-tips/#comments Tue, 01 Aug 2006 13:00:03 +0000 Frugal http://www.1stMillionAt33.com/2006/08/two-must-do-money-saving-tips/

You may not want to clip coupons, or you may not go to discount stores.  But at least, you should follow these two effortless saving tips that will save you big money in the long run:

1. Earning interest from idle cash: Open an Emigrant Direct Saving account at 5.15%, or HSBC or Capital One accounts that consistently pays a higher interest rate.
2. Earning cash while you spend: Get a Citi Dividend Platinum Select Card to get 5% cashback on your gas/drug/grocery purchases, and 1% cashback on all other purchases.

There may be other better banks or better cashback credit cards, but if you do the above, at least you have a very good start.  How much money you can save in the long term?  With #1, assuming that you have just an average balance of $1000 in the account, and let’s use the comparison of 5% in Emigrant Direct and 1% in Bank of America savings account (it’s probably lower), the difference in yield is 4%.  I’m going to use 3% for the yield difference to be more conservative, since the money market account won’t always yield as high as 5%.  Because of a consistent 3% higher interest rate, in one year, you can save $30 extra in interest money.  For the next 40 years or so, you can get $1200 interest money.  I’m using simple compounding because most likely you will spend those $30 right away every year.  And that’s just for an average balance of $1000.  If your average balance is higher, your extra savings will be higher.  Now, tell me how much time does it take to open an online bank account?  Yes, in about 30 minutes of one-time effort, you can probably earn $1200 in additional interest for every $1000 average balance.  You just get paid at an hourly rate of $2400/hr.  That’s a huge return on your time spent (using just $1000 average bank balance).

Now on the credit card, it’s an even better return (well, for people who spend more but save less).  Monthly, let’s assume that your family needs to spend some $250 on gas, and $500 in grocery store, and another $750 in other expenses that you can charge on credit card.  Using the Citibank card, you can get ($250 + $500) * 5% + $750 * 1% = $45 per month or $540 per year (by the way, Citibank card has an anual limit of $300 rebate, so you will need to apply for two cards to split this $540.)  Now, multiply $540 by the next 40 years, and you will get $21600 in cash rebate in total, TAX-FREE by the way.  Again, how much time does it take for you to apply credit cards?  Half an hour or so, and you would have paid yourself at the rate of $43200/hr.  Now, if that is not good use of your time, then I don’t really know where else you can earn $43200 per hour, tax-free.  (Unfortunately, if you have some debt on your credit card, you may need to shop differently for a lower APY instead of getting cashback.  Now you know why credit card debts are not good.)

Of course, the above scenarios assume that both the bank and the credit card continues their end of deal.  As far as I can see, and from my personal experiences too, there seems to be no reason that they will change their way of doing business.

Please do yourself a favor.  When you have time, go to the links and open those accounts.  I’d rather see you get richer than big corporations getting filthy rich from scalping average people.

For more information, you can read the following posts on credit cards and banking:

1. Why I would choose EmigrantDirect over others
2. How I Bank
3. Comparison of Cashback Credit Cards for other good deals on credit cards.

 

]]> http://www.1stMillionAt33.com/2006/08/two-must-do-money-saving-tips/feed/ 8 http://www.1stMillionAt33.com/2006/07/254-per-month-for-a-pre-paid-cell-phone/ http://www.1stMillionAt33.com/2006/07/254-per-month-for-a-pre-paid-cell-phone/#comments Sat, 29 Jul 2006 13:00:51 +0000 Frugal http://www.1stMillionAt33.com/2006/07/254-per-month-for-a-pre-paid-cell-phone/

As you may be aware from my previous cell phone post, that I was paying $3.21 a month for my cell phone on my AT&T (now Cingular) Free2Go plan. Because I could no longer buy those $10 refill card from grocery store, my minimum rate will be going to $8.33 a month instead (one $100 refill card per year). Because of this incoming change in a few more months, I have decided to shop around and see what I can find. So much for all the wireless competitions in the last few years, I was amazed that most of the major wireless carriers have increased their rate on various plans. But fortunately and surprisingly, I found another cheaper pre-paid cell phone plan offered by Page Plus Cellular from forum of wirelessadvisor.com. Here are the details of this pre-paid plan:

1. You can buy $10, $25, $50 refill cards, each won’t expire in 120 days. The rate per minute ranges from 14 cents on $10, to about 12 cents on $50 cards.
2. There is a monthly maintainence charge of 50 cents.
3. Wireless network is from Verizon Wireless, and it uses CDMA technology.
4. Minutes can be roll-over before expiration.
5. Roaming is expensive at $1.99 per minute. Text messaging is 8 cents per minute. And according to raderator at the forum of wirelessadvisor.com, they charge for leaving voice mail.

So based upon the above information, the minimum that you need to pay per month is $10 / 120 days * 365 days / 12 months = $2.54 / month. Because there is a monthly maintainence of 50 cents, I calculated that paying the minimum will get you 175 minutes (at 14 cents per minute) which is about 15 minutes per month (but can be accumulated and carried over). Adding more minutes will be easy by just refilling with more. Let’s assume that every year, you only refill with $10, $10, $10, $25 cards which are $55 in total. You can get 32 minutes per month, at the price of $4.58 per month. At any rate, because you can roll-over your minutes, often you can simply accumulate your minutes for emergency usage, and eventually settling down on paying only the minimum of $2.54 per month (assuming you don’t talk more than 16 minutes per month).

On my Free2Go phone, I know I use very little, even though I pay $10 for 40 minutes about every 3 months, just about 13 minutes per month. Most of the time, I just use the phone to tell my wife about my whereabouts, and that only takes 1 minute (or 2 minutes on both phones). Currently, I have accumulated some $30 and $10 dollars on the two phones that I have due to all the roll-overs.

By the way, user raderator at the forum suggested to activate the phone from Ebay for only $14.95 with 100 minutes (in case the auction expires, you can search for “page plus cellular prepaid” on ebay), and I did check it out. It looked easy, fast, and reliable to me.

Here is an user who has used the service for 7 months plus.

I won’t be switching to this plan yet, until probably early next year when all of my $10 refill cards run out. But I can’t wait to tell you about this cheap pre-paid cell phone plan. If anyone has any good or bad experiences with Page Plus Cellular phone service, please be so kind to share with me & the readers. Their home page looks not 100% professional to me, but since someone has used their service for more than 7 months, I assume that it must be sufficiently good. If anyone gets to try their service out, please let me and everyone reading here know about your experience. Thanks in advance.

P.S. Another VERY GOOD (if not better) pre-paid cell phone plan is T-Mobile. Be sure to check the comment sections for the details.

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