A DOLLAR SAVED IS A DOLLAR EARNED! That, with apologies to ol’ Benny Franklin as we’ve had to adjust for inflation! Simply put, that’s what this feature is all about - savings pennies, dollars and in some cases, small to large fortunes!
Significant savings are all around us - every day - but ’tis easy to overlook them - until perhaps, you find yourself in a financial bind. Let’s try to avert that by checking out the following articles. And remember:
Often, it’s not so much the dollars conserved but the percentages, as well. A 30% savings on a five-dollar item is a mere $1.50, but if you extrapolate that to a bulk purchase of perhaps, $500.00 - now, you’ve kept in your pocket $150.00!
-Dean
% % % %
01.01.07
7 Costly Mistakes To Avoid This Year!
{Read This Article & Save & MAKE Yourself Lots Of $$$!}
Statistically, you may be amongst those who unwittingly throw a bunch of bux down the drain on a regular basis - without meaning to do so! Let’s hope not, but if so, let’s fix the problem(s) right now:
1. You are renting your home rather than buying it. We Americans are fortunate and unique: More of us own our homes - more than any other culture in the world. Still, far too many fail to take advantage of the opportunity afforded us all to purchase private property or, erroneously get it into their head the notion that home ownership is only for those whom they perceive to be ‘’better off.'’
The truth is, virtually anyone - single, married, young, old, gainfully employed, self-employed or even UNemployed can, in fact, buy their own home, and in many cases, without a single dollar of down payment. We’ve covered the DAX techniques for doing that in other of our writings and surely will address the topic again in the future.
Suffice to say now: Major cash sums can be saved and earned from home ownership versus just being a tenant. There are certain legal tax deductions available no other way, for starters.
Plus, there is virtually an iron-clad guarantee of appreciation of property value with the passing of time - sometimes, only a little bit of time. On average though, even a modest property will double in value every ten years. Conversely, your rental payments will do likewise . . .
My suggestion: Get very serious about acquiring your first personal residence THIS YEAR! The real estate market is widely perceived to be ‘’down'’ as this is written - making it an opportune period in which to acquire property(ies) on a much easier basis than normal, when as indicated, it is almost always quite simple, anyway!
A number of people who paid too much for a home or in other ways have over-extended their budget - or have lost their job - or are experiencing a divorce - are all logical candidates for needing to ‘’unload.'’ You come in with a bonafide ‘’take-it-off-your-hands'’ offer - and go home and start packing!
When you make that initial purchase of a home for yourself - and have swept aside the mystery of the process, you’ll be in a position to start accumulating other properties for profit - but then, THAT is another story for another time . . .
2. When it comes to the vehicle(s) you need for you and the family, we could simply say ‘’ditto.'’ It’s plain foolish in almost ALL circumstances to lease a car or truck as opposed to purchasing.
You will always need to ‘’crunch the numbers'’ and assess how your particular business and personal activities are affected in particular, BUT in most cases, vast savings can be realized over a 5-7 year span if you buy and hold rather than lease and release - which is precisely what one does when they lease:
They pay for the first two-three years primary value - through the nose - only to give back the vehicle at a time when the numbers would otherwise start making some sense in terms of length of ownership.
Some $$$-Saving Hints:
If you ‘’must'’ have a luxury vehicle - automobile or SUV - go online and study various automotive websites such as Kelly, Edmunds and even, ‘’Consumer Reports.'’ See how a Cadillac stacks up against a Lincoln, Mercedes, BMW, Lexus, Infinity and others in that category. When you find one that you like - with a good mechanical track record (J.D. Power provides good counsel on that aspect) - only then, seek out a three - year old model - not a new one.
In so doing, you will instantly save many thousands of dollars - upwards of $10,000,00, $15,000,00 or more! Plus, all the ‘’bugs'’ will have been worked out of your vehicle by the original owner and the dealership which means YOU get to avoid wasting time, effort and money with the likes of ‘’No, Greg - the rattle is STILL in the back left door. You say I can bring it in again Friday? Okay.'’
Next, negotiate the very best CASH purchase price possible. Hopefully, you will have the cash to pay - if not, secure the funds anywhere except at the dealership where you will end up paying all sorts of hidden charges. Best to arrange in advance a loan with your local banker - and realize that, as with all goods and services, the price of the money (interest) is also negotiable! Even before the rate is quoted be at the ready to say, ‘’That’s too much!'’
To reiterate: It would be best to take the money out of your savings, if you have the money, because the going rate to borrow will often be twice what you’re being paid. Just try to time such withdrawals to when a CD is maturing, if that is where you keep your bux.
You may also want to consider acquiring a vehicle in a much lower price-range, as virtually all modern-day vehicles are several hundred percent higher quality than those of yesteryear when there was some validity in opting for say, a Chrysler Imperial as opposed to its poorer cousin, the Plymouth.
Manufacturers used to put all the ‘’good stuff'’ - the technology, premium upholstery, etc., into only the higher-priced vehicles where nowadays, you can get a fully loaded Camary, for example, with leather, all the bells and whistles, etc., for twenty grand or less. Its snootier big brother, a top-of-the-line Lexus, will set you back upwards of seventy thousand!
Most all vehicles today will last for a very long time - ten years or more is common. And that, without major repairs. 150,000 and 200,000 miles on even a Ford or Chevy - but to be sure, that’s ‘normal’ mostly, for Japanese products.
Continuing with that thinking, you could buy a Camary, Kia, Hyundai, Honda (class) vehicle that is 2 - 3 years old for less than ten grand, get superior fuel economy, have far less insurance to pay plus another very important benefit: Far cheaper repairs and parts if you need it. Even tires, batteries, oil and air filters are much less on such vehicles.
In summary: Buy not lease. Pre-owned not brand new. Smaller may be better. Smart versus ostentatious and you will save many thousands of dollars each year - starting in 2007!
3. Your bank cards. For years, we have ‘’preached'’ on this subject - often. Indeed, we publish a very popular report called ‘’Besting the Bankers'’ which sells for $25.00 (inc. s/h) via the DAX STORE.
In the report we illustrate how to save $300.00 or more within two hours of reading the report. Here are some highlights, plus some fresh data covering ways to save even more money:
On average, every American has 8 different charge cards. That is, at once, totally unnecessary, wasteful, stupid and downright dangerous. A MAXIMUM of two cards, such as a VISA and a MasterCard are more than adequate for most all purposes - business and personal.
Having too many cards can damage your FICO score, as it makes it obvious that you have a great deal of potential credit exposure which may be tapped by you excessively or, by someone else fraudulently.
Too, you have the temptation of using ALL the cards in your wallet - especially, around the holidays(!), plus there is the necessary bookkeeping, check writing, and horror of horrors the various INTEREST costs if you fail to pay off the balance(s) each month. One card for personal - one card for business should be more than adequate: I can tell you that many multi-millionaires consider it so . . .
A glaring oversight that many otherwise intelligent people should know better is that of paying your card-issuing bank an annual fee. That is just plain stupid - there is no other word for it, Long ago, banks imposed annual fees - and got away with it. We at DAX pioneered how to eliminate those annual fees and many others jumped on board.
Today, it is seldom that a bank will try to impose that fee - but some still do! I chatted with a young woman at a store the other day about cards in general, as she broached the subject, because I carry an unusual looking card. She revealed that she and her husband had just gotten a new bank card and they have to pay $39.00 a year for the ‘’privilege!'’
I set her straight quickly and will do likewise for you: When you go to any lending source - bank, credit union, savings and loan - wherever - realize, that YOU are doing THEM a huge favor! Without you - and many others like you - they would not have a business to be smug about! It is NOT the other way around:
You can go anywhere to borrow funds to build a house, buy a car, appliances or a trip to Europe. No doubt you receive many offers to issue you a new credit card every week. Competition is fierce. YOU are in the proverbial ‘’driver’s seat'’ when it comes to acquiring money and/or credit from such institutions - regardless of what the teevee pundits would have you believe.
Remember, they are being paid off by the people who buy commercial time on their programs. NO ONE is buying ME off (although, ‘twould be nice if someone would TRY - so I could get all pompous and turn ‘em down!)
So. Hold fast, strike your best deal and demand that your card-issuing bank pay YOU for being so nice as to ‘’give them your business!'’And I am serious, because:
Many card-issuing banks today - but especially, those which operate online - offer attractive cash rebates - the current average is 1.5 %. That means, each time you use your card to make ANY purchase - no matter how large or small, a portion of the amount is placed in a separate bank account where it accrues interest - currently, at most such banks, in the 5% range!
Now, shop around - easiest to do on the web - just GOOGLE ‘’bank rates'’ ‘’bank card rates,'’ etc., to find the best deal for you, Hint: Avoid banks such as CHASE which do offer attractive-sounding rebates, but the fine print reveals the monies are based on a ceiling - so that the most you could get would be $250.00 a year and worse still, they require you to actually ASK for the rebate every month or so - essentially, beg them for your own money back!
To get the most out of ANY credit card that offers a built-in, automatic rebate program, start thinking in terms of all ways you could use the card in place of writing a check or paying cash. Virtually ALL restaurant purchases. At the supermarket, the gas station, department stores (use your bank card instead of the store’s chargecard) and for similar purchases.
Those are pretty standard. But also consider using your card for buying stamps or mailing packages at the post office, FED-Ex, UPS, etc. To pay your annual or semi-annual car and house insurance. To pay your doctor, dental or hospital bills - or the co-pay, if you are insured.
Set up your ISP to deduct the monthly fee from your account. Ditto for your cable and phone bills. Some jurisdictions allow you to pay your property taxes - even a traffic violation - with a chargecard. Just make sure that they do NOT impose a service fee.
There’s a sneaky trick that some governmental agencies employ whereby a separate private company processes the chargecard transaction and then, charges YOU $10.00 (or more) for the same. No doubt in time, a court case will declare that is unconstitutional - or at least, plain wrong, as no such charge is made when you pay with cash or a check!
When you start thinking in terms of the money you pay OUT actually returning in small amounts to you merely by taking some simple steps to convert your various payments to your chargecard - it begins to really add up. Hundreds of dollars in ‘’free money'’ every year is common!
Another important way to save money is the lesser of two evils, although in this case, I guess it would accurately be the lesser of two blessings, to wit:
Pay off your credit card balance IN FULL each and every month as soon as your statement arrives. As an aside, it may be worth paying the extra $4-$5 to send your payment in via Certified Mail. That way, you have a tracking record of the payment plus a signed receipt - and if/when the bank claims that they did not receive it in time - so as to impose some ‘’vigorish'’ on your account - which may be as high as 30% - you can just say, ‘’Nope - no way you’re getting away with THAT!'’
An alternative would be to transfer the $$ that you owe on the card from your online bank account which probably, is the ‘’parent'’ of the charge card. That way, the transaction costs you nothing and you are certain that it has taken place because of the copy YOU print of the transaction.
As for the other of the two ‘’blessings:'’ If you must carry a balance from one month to the next, take steps to drastically reduce the interest rate that the bank is charging you. Oh yes, you CAN do that - and very quickly - on the phone. Just call a card representative and say something along the lines, that you have noticed that the rate they are charging you is extremely high.
Several competing banks have offered you a much lower rate. Indeed, (and this will honestly be the fact) one or two banks have offered you a ‘’zero'’ rate of interest for several months. Ask nicely but firmly - whether your current bank would care to offer you a MUCH better rate. They will. Almost always, they WILL. If not - tell them ‘’Thanks for your past considerations - we will be going elsewhere then.'’ And then, take advantage of one of the lower rates of interest that has been offered to you.
A word about THAT: YOU must be careful about so-called ‘’teaser rates:'’ First, they are not permanent. They are generally offered for three - to six months, tops. Once in awhile you’ll see an offer for a full year.
But in all cases, read the fine print! You may be opening yourself up for more problems in the form of hidden charges, transfer fees and such. Just execute your ‘’due diligence'’ as we say in the stock trading world. Check it all out. Make certain that you are getting a better deal than the one you’re walking away from.
Do bear this in mind: Most bankers - like lawyers and politicians are pathological liars. They don’t know any other way of dealing with people.
Whenever you decide to cancel a credit card, it is vital that you do so formally: Write a letter to the effect that ‘’as of this date we are canceling such and such credit card #11111111111.'’ Enclose the card(s) all nicely cut into many pieces. Express your appreciation for past business dealings!
Leave on a pleasant note. Ask that they inform the 3 major credit reporting agencies of your action: It should (eventually) appear on your credit report, ‘’Account closed at customer’s request'’ which has a MUCH more positive impact than any other verbiage, such as ‘’Closed by card issuer,'’ etc. Oh, and again, spring for the Certified, Receipt Requested at your post office and file away the pertinent data - indefinitely.
In handling the matter in this way - particularly, if more than one charge card is cancelled - you will significantly improve your overall credit score - again, because you will have pared down your total credit exposure.
We spent a lot of time here discussing credit cards because most every American conducts the major part of their personal and business financial activities based on them. The net effect of what we’ve covered above will leave you with just one or two good cards instead of a whole raft of ‘em.
You will pay NO annual fee, your rate of interest if you MUST pay in installments will be consider-ably lower than it was, you will receive periodic cash rebates based on activity, and those means will automatically be transferred to an interest-bearing account that probably pays more than any local bank and all in all . . .
. . . you will save a great deal of time plus the attendant cost by not having to write and mail so many checks every month and you’ll be sitting pretty by comparison to all those others who have way too many cards which they pay exorbitant and unnecessary sums for every year.
I would wager that when your restructuring is accomplished you’ll save at LEAST $650.00 or more annually PLUS you will EARN twice that or more in that ‘’free money!'’
4. Quit piece-mealing when you buy necessities! Look, you know darn well that you’re going to need certain staple items in your household every week, month and year.
I don’t need to list ‘em in detail for - make your own list. Canned goods and other basic foodstuffs, socks, underwear, pens, pencils - toner, paper - whatever. So, start acquiring such items in bulk - rather than just picking up one or two at a time. You can save MASSIVE sums of money that way! And not just at the obvious places like Costco or Sam’s Club.
Virtually ANY store in the land will give you a significant price break if you ask for it when you purchase in quantity. A dollar can of beans, corn or other vegetable or fruit can usually be had for half that amount - or even less. Naturally, all such stores have periodic sales, and that’s an even better time to stock up.
I like certain foods that are inherently rather pricey - artichokes, asparagus, extra virgin olive oil, stuffed grape leaves, olives plus many others. I just keep an eye out for a sale and buy a basketload of (whatever) and always save significantly.
One time SuEllen and I tallied up our savings for the previous year by being prudent (I prefer that term to frugal) and we realized that we had literally put an extra $5,000 in our pocket! Hey! That’s real money - that can be saved to accrue interest, or spent for something else one may want or need.
Five thousand bux times 10 years - is $50.000.00 - and at 7% interest, that sum doubles every decade. Hmmmm . . . buy in bulk and have, in actual cash, a hundred grand just from money SAVED . . . ?!
The obvious caveat: Never buy anything JUST because it’s cheap. Make certain that you really like the product and can use it within a reasonable length of time. I LOVE cheese of any kind: Bought about 70 imported swiss cheese packaged in wooden containers a year ago:
The local supermarket charges $5.70 each - I got ‘em all for a buck apiece. Have eaten about twenty - but the expiration date is rapidly approaching. Hope the Amish like Swiss cheese - well, of course they would - that’s from whence they emanated some 500 years ago!
5. Another often-overlooked financial error that many people make is paying too much for property taxes. Usually, a homeowner will merely complain a little when the tax bill arrives - but to the wrong people! You need to address the issue with the local tax assessor and/or the tax review board.
This may well be overlooked if your tax is incorporated in your mortgage payment. You’ll need to get a firm handle on what your annual tax bill is. In about 40% of all situations, the amount being paid, is in fact, higher than it should be!
It may require a bit of legwork, some ‘’carping'’ here and there, but in the end you should be able to shave off a few hundred dollars from the ANNUAL total! Also, question whether there is a senior discount offered in your community - some places knock off a few percentage points for taxpayers who are 62 or older.
Some places lift the tax entirely for a much higher age range - 80 and up. But in almost all cases, it is up to YOU to determine whether such a break exists and then follow through to confirm that it is instigated. When we first moved to BLUE HERON POINTE I noticed that our local jurisdiction was ignoring our legal right to the Michigan Homestead exemption.
If you own and occupy a residence full time, you are entitled to a significant tax break. However, on second homes or vacation properties there is no allowance. Well, the ditz in charge at the local treasurer’s office could not get it through her head that yes, we actually LIVE here - and yes, it IS on a lake and YES, we surely DO love the ambience, but it is NOT just our summer place!
I had to fight like crazy to get the exemption to which we were 100% entitled - even brought the Lansing big-wigs into the fray. BUT it was well worth it.
Some people would suggest that you chat with your neighbors to see if your tax bill is in line with theirs, but most people today would rather discuss their sex lives than talk about money in any way so that’s not a good idea. Instead, go to wherever your tax records are maintained in your county and ask to ‘’see the books.'’ Check out your property taxes against others in the area.
When you spot a discrepancy that could work to your favor - YELL - to whomever you need to and get your assessment downgraded. This is especially important as EACH time a new tax statement is sent out you can be certain the amount you are asked to pay will be more than the last time!
6. The biggest $ goof of all - for 95% of Americans? No one SAVES enough money! We’re not talking now about the various areas of conserving such as we listed above. No, I’m referring to the oh-so-vital act of taking some of your cash and setting it aside in an interest-bearing FDIC protected bank credit union or savings & loan.
Just about every industrialized nation in the world has a far greater savings rate than we do - the Japanese manage to saki it (ouch) away to the highest degree of all!
To my mind, the underpinnings of free enterprise and Capitalism are based on systematic savings commitments by the ‘’producers'’ of the society - those who recognize the importance OF saving actual money . . . conserving precious resources and the building of assets . . . preparing for the proverbial ‘’rainy day.'’
Setting aside a specific amount of money - or a percentage of money - each time you get your mitts ON some money - from any source, be it your paycheck, sale of a resource, your business receipts or a casino or lottery windfall - is perhaps, the most lasting benefit you can bestow upon yourself!
It will provide for a stable, solid, powerful foundation on which to construct all edifices near and dear to your heart - providing for you and yours security, comfort, pleasure, serenity, happiness and above all . . . a future worth looking forward to!
Significant savings can underwrite the cost of a new home, cars, vacations, advanced education for your children or even for you or your spouse! If you have little or no experience with a systematic savings program, start with a basic 10%.
Each time you get ANY money, cut 10% right off the top, deposit it in a bank and only THEN go about your business with the remaining 90%. Do that consistently, and you may well get rich some day in spite of yourself! (And YOU will be the ‘’Grand Door Prize'’ - if you are a John Prine fan!)
7. The biggest money-mistake that any ambitious, progressive, deep-thinking person can make is to continue working for someone else. I do realize that some people appear to be simply geared toward being an employee rather than an employer. Okay, I’ll give you that - although I really do not understand it!
But for MOST people in the work force which statistics show HATE working for someone else, there really is no good reason to continue down that sorry path. There are numerus opportunities in this country to strike out on your own - start a business - and gradually, grow it into something worthwhile and hugely rewarding.
As with everything else, nothing along those lines will happen until YOU decide that it is going to and then, start taking the first steps towards that goal. Perhaps, 2007 is the year for you to do that . . . what do you think?
% % % %
11.06.06
More Tip$ To $ave @ The Ga$ Pump
We may have to pay through the nose to fuel our vehicles, but it does not follow that we are at the mercy of the oil companies when it comes to actual consumption: Only WE control that and there is a little-known fact that may help us do that:
Overall fuel consumption by a vehicle breaks down to only 20% of the fuel being used to keep it in motion: The other 80% of fuel is wasted in idling, antiquated start-up procedures, careless take-offs from a standing start and so on. Isn’t that surprising? It was to me! Based on that, here are some solid ways to conserve fuel:
CHANGE YOUR HABITS
When you get into a car that is not running and the engine is ‘’cold,'’ it is no longer necessary to start it up and allow it to ‘’warm up.'’ Modern day vehicles just do not require that procedure.
Again, you get into the driver’s seat and rather than start the engine, attend to all the other necessary maneuvers first: Seat/shoulder belts. Adjust the seat, the inside and outside mirrors, the steering wheel and put on your sunglasses, if needed and THEN turn on the ignition - and drive off! That new habit alone can save up upwards of 5% in fuel each year!
When you start off from a standstill, avoid the urge to slam your foot down on the accelerator. Instead, depress it slowly and evenly and allow the transmission to track through the gearage in a smooth, orderly way. In short, no burning of rubber! Savings? 5 - 7% annually.
When up to speed, know that each 5 mph over 50 decreases fuel economy by 7%.
Do you really need for the a/c to be on all the time during warm/hot months? There is some controversy about a/c versus just putting down the windows, but common sense dictates that a machine that requires a constant energy source is probably less efficient and costlier than any increased drag coefficient caused by lowering the car’s windows - or the car’s top, for that matter.
Ditto for car seat heaters, or the car’s interior heater, headlights, fog lamps, etc. If you need to use them - fine. If not, turn ‘em off! They all consume extra energy and thus, fuel.
When at a stop light or stop sign or waiting at a drive-in for your food to arrive or at a drive-in bank, dry cleaners or whatever - TURN OFF THE ENGINE! One vital design element of the hybrid vehicles is that the engine - gas and/or electric - is shut completely off almost at once, when the vehicle has no need for it TO be running. Follow the lead of those engineers - there are MANY reasons why the Toyota Prius gets 65 mpg and your old SUV gets 14 - and that’s one of ‘em that you can control!
MAINTAIN VEHICLE CONDITION
The cost of regular maintenance of your car or truck is minimal compared to the real possibility of costly breakdowns and the definite fact of extra fuel that you’ll be paying for. Be sure to:
Replace dirty air filters: A clogged one can cost you a full 10% in reduced fuel efficiency! In terms of dollars, that could mean $2.00 - $3.00 lost every time you go in for a fill-up!
Make certain that the tire pressure is correct for the tires that are on your vehicle. That is, there is always a car manufacturer’s sticker on the door jamb somewhere telling you what pressure you need to maintain in the tires - but those are the tires that came with the car!
Very likely, your car no longer has those tires but replacement ones, so you need to check the sidewalls (of the tires) to ascertain what tire pressure is recommended by the TIRE manufacturer! Under-inflated tires of 2 psi translate to a loss of fuel economy of 1%.
Toss out any bodies that you may have been hauling around in your trunk - or anything else that’s in there that is just dead weight: Each 100 pounds of unnecessary junk you carry around equals about a 2% loss.
Did you know that cargo carriers on the roof or trunk, or bike racks, ski racks and such require 50 % of the engine’s power at highway speed? That’s due to the need to overcome the aerodynamic drag caused by the extraneous add-ons. If you do not really need them, by removing you can save 5% on your fuel bill.
Finally, ‘’Elizabeth, this is the big one!'’ Engine tuning is vital - even on modern cars that may offer tens of thousands of miles between servicing. Faulty engine components can reduce efficiency drastically and cost you as much as 40% in fuel economy!
Probably none of us will ever take all of the above steps to conserve energy, but even two or three would make quite a difference in our annual tab to move the old flivver about . . .
% % % % %
EASY CASH SAVINGS FOR EVERYBODY!
Many times we’ve talked about diverse ways to save money. I’ve told you that SuEllen and I have enjoyed trying to outdo each other over the years via making purchases for the least amount possible and/or in some cases, figuring out ways to MAKE a few bux that are unconventional.
We’ve always done it for fun. (When I was young, crazy and poor, I did it out of necessity. Now that I’m old, eccentric and rich, I do it for pleasure!)
Anyway, one way to save a huge bundle is by frequenting the (now) many different so-called dollar-stores that have popped up during the past decade all over North America. Frankly, I thought for a long time that doing so was ‘’beneath me'’ (when’s the last time you heard THAT old-fogey phrase?!)
But after first being introduced to the concept by youngest daughter, Dominique (P.C.) some years ago - that all went by the wayside. By the way, P.C. started going to such places for fun, as well - ’cause she and her husband have ALL the money left over after Oprha and Billy Gates took their paws outta the cookie jar!
There’s a chain called Family Dollar Stores - and it has also become the darling of Wall Street, if you’re interested. At one of those joints you can get just about anything for a pittance. I get Alaskan salmon (which is the healthiest of ALL salmon sources). A buck a can, of course. Big jars of pickled artichokes. Virtually, all toiletry items, doo-dads and gizmos. Even got a batch of reading glasses, ’cause I have a tendency to leave ‘em in restaurants and now, no need to hurry back to retrieve the $200.00 version!
With the dollar stores and a judicious approach to spending on all things, I see no real reason why anyone needs to ‘’go without'’ - especially, as regards eats. Truly delicious and nutritious meals can be quickly slapped together from a never-ending supply of low-cost basic foodstuffs available across the land.
Where we (now) live - in Amish country - we get huge fresh brown eggs for 75 cents a dozen. Seasonal fruit for a fraction of usual cost.
The best baby Swiss and farmer’s cheese for a third what it costs at the supermarket. The old lady who runs one of the stores even gets me already-toasted rolled oats (99 cents for a huge bath that lasts two months!) to which I add cinnamon, nuts or fruit for breakfast.
Anyway, just a little extra ‘’food for thought . . . ‘’
% % % %
DREAMS DO (SORT OF) COME TRUE!
When I was a kid I had a recurring dream that I found a mountain of shiny pennies up the street, ran home, got my red Radio Flyer wagon and loaded up my new-found stash . . . I was rich! Then, I’d wake up, and although the dream always seemed 100% real, it was not.
But . . . the other morning I went out very early to buy a newspaper. Where I parked I noticed a whole bunch of pennies scattered around: Yes! You’d better believe it - I gathered them up, took ‘em home, washed them thoroughly and now I’m 16 whole cents richer! HA!
Okay! So the late, renowned, cheapskate Jack Benny and I share more than just the same birthday (Valentine’s Day) . . .
% % % %
A GENUINELY FREE CREDIT REPORT
Over the last couple years many people who should know better have been touting ‘’free credit reports'’ on various teevee shows. Those particular reports are NOT really free at all - requiring one to sign up for a costly trial sub-scription contract, plus give out precious credit card and social security number data.
I got so tired of the scam (which we have brought to your attention a couple times before), I finally contacted Jean Chatzky - the teevee money guru who many people have said looks like one of my own daughters (She’s cute, has light brown hair, and is super-smart!)
She agreed to quit giving free publicity to the idiots who were claiming to provide free credit reports when in fact, they were not doing so.
Fortunately, your good ol’ Uncle Sammy has stepped forward now and is requiring that all three of the principal credit reporting agencies provide every American consumer with an annual credit report - at NO cost. This comes under a new law that was passed (in December of 2003) and then started a year later on December 1, 2004.
The law is called ‘’Fair & Accurate Credit Transactions Act,'’ and in part was enacted to help thwart identify theft. You may also make any corrections to your credit report(s) which may be making it difficult for you to obtain credit, or more likely, is foisting a higher interest rate on you vis-B-vis your FICO score - as we reported to you in a recent issue.
As of the starting date, folks in all Western states (only) have been able to secure their free credit report, and in March, residents in the Midwest can do likewise. Southern residents can gets theirs starting in June and those living in the East will need to wait until September.
This staggering of start dates allows the three credit reporting agencies to space out what many perceive will be an influx of requests.
For more information go to the website: www.annualcreditreport.com, phone 1-877-322-8228 or write to: Annual Credit Report Request Box 105281, Atlanta, GA 30348-5281.
This new ‘’citizen’s perk'’ will save you as much as thirty - forty bux per year - perhaps, much more if you were to get suckered into any of the other ‘’products'’ the folks have previously tried to sell you - after being lured to their websites with spurious promises of free credit reports.
By the way: Those same companies will continue to attempt to sell you various things - which more than likely you neither want or need - so be careful when paying them a visit!
RINGY-DINGY UP SOME SAVINGS!
’tis just plain foolish to pay your phone company’s long distance rates when there are so many alternatives. There are the various ‘’10-10′’ deals we’ve mentioned before - such as 10-10-220 and the even less expensive 10-10-987. Also, many use the phone calling cards and we’ve done a bit of research on those:
At a hotel where we stayed in Traverse City, the only way they would permit a long distance phone call of any kind was via purchasing (for a mere $5.00) a 120 minute card - approx. 4.1 cents per minute. I later discovered the thing could be ‘’recharged'’ and the prevailing rate for the minimum number of minutes (600) figured out to be even less - 3.7 cents.
For the heck of it, I also bought a 20 minute card for a buck at a dollar store. Obviously, that’s 5 cents per minute. A recharge on THAT was about the same - no real savings. Check around the various calling card deals and you should save a considerable amount IF you make a lot of LD calls. Otherwise, probably not worth the bother.
% % % %
SurTHRIVing ‘’BAD TIMES'’
Perhaps, you caught the recent evening news report about a single mother with three kids who, despite earning above minimum wage, was com-plaining about how she was having a tough time making ends meet. Indeed, it would appear that the thrust of the piece was to get viewers in a frame of mind to contribute $$ to helping her out.
The woman, by the way, was at least 50 or more pounds overweight, was sporting those flashy designer hand-painted fingernail extensions, had a new hair-do for the occasion and the scene where her kids were watching the teevee clearly showed a pretty big modern one - about 36″ at least and the kids were all dolled up in designer sweat shirts, pants and sneakers.
The woman also mentioned (and this is 100% gospel-true) that one of her tougher financial commitments was the $50.00 a month CABLE BILL! Oh well . ..
You may not know that I had a life before DAX - wherein I was the Executive Director of a network of Debt Collection Agencies. I also developed a program of credit counselling - debt consolidation - for deserving people I’d run across from time to time who were in their financial predicament due only to ignorance rather than larceny.
As such, I helped many a family come to grips with their truly miserable monetary miseries and then, figured out a way to extricate them from the morass.
Here are some simple helpful hints for anyone who now finds themselves in a financial pickle:
Assess ALL of your daily, weekly, monthly and annual expenditures. WRITE IT ALL DOWN! Just about anyone you’d speak to about their financial concerns hasn’t a clue as to the actual outlay for which they are responsible. They will think only in terms of the rent or house payment, the car payment, the appliance(s) payment(s) and weekly groceries.
But they will totally ignore the costs of house, car and medical insurance, taxes, various utilities, the ‘’extras'’ which are pretty common, if not always precisely predictable: Kid’s financial requirements for school as in books, trip fees, athletic and/or music participation, Girl/Boy Scouts etc., etc. Gifts, obligations of social reciprocation, church or other charity commitments, etc.
First on the list of ‘’help'’ then, is the simple task of determining accurately what one’s obligations truly are.
Establish a realistic budget. Cut out the nonsense. When a person, couple or family is experiencing genuine dire financial straits, there is simply no room in the budget for all the things that are normally ‘’taken for granted.'’
The afore-mentioned cable connection - it’s gotta go - NOW! Eating out - way too costly - forget about it! Shopping excursions - to ANYWHERE - kaput!
The usual gifts one might otherwise purchase for friends or relatives - must be quelled. Come up with an alternative - write a nice letter, make a fancy card, make a gift if it costs naught - but do NOT blow $$ on stuff you simply cannot afford.
Curtail all trips and/or at the very least, combine errands to save on fuel and wear and tear on your vehicle. The ‘’extras'’ so may people feel are necessities nowadays just are NOT: The call- waiting or other fancy-schmancy monthly add-ons for your telephone. A separate line for your Internet service? Hardly! A cell phone? Don’t be dumb!
Just look around you and your family and your house and your car and all the things that you now support. Where can you cut? What can you eliminate that is now costing you money and grief? The trick here is, do it again! Yes! Once is not enough!
Make a list, take some action, cancel or cut out as many expenditures as possible and then . . . DO IT AGAIN! The more times you do, the easier it becomes and the MORE money you save!
Food is always a big item in any household but oddly, if one is smart and becomes know-ledgeable, it can be a major source of savings. Substitute iced tea for soft drinks. (It only ‘’hurts'’ for a little while!) If dieting is not an issue in your household, then you’re ‘’home free.'’
Foodstuffs, when there is no inherent concern for calories and/or carbohydrate intake become a breeze to create! Macaroni, fresh vegetables, tuna and other fish, potatoes, rice, beans, some fish or meat - all are relatively inexpensive and with some developed skill can be transmogrified into marvelous, gourmet dishes that will far surpass any that you’ve come up with in the past - yet be produced for pennies!
SuEllen and I have often gotten out a pencil and figured that a family of five could eat WELL for less than $25.00 per week - once they took the time to learn how. That means, of course, that one does NOT buy expensive and unhealthy prepared or packaged foods! That’s just silly - and most people who have fixed more than one or two meals in their life inherently realize that.
The foregoing is NOT ‘’pie-in-the-sky'’ but comes from actual recent budgets that SuEllen has structured for several people she assists.
Again, I hate to say it, but the preponderance of all those ‘’sad cases'’ you see on the teevee news shows are grossly overweight ‘’mamas'’ and their equally obese children . . . now, that’s the truth, isn’t it?
Here’s the ol’ bottom-line on all this: Any time ANYONE is suffering from a case of those ‘’monetary miseries,'’ fast and lasting relief can often be found merely by stopping, taking a long hard look at where all the $$ is going - and then, making a few common-sense changes to reverse the trend.
Often, enough money can be saved to use for other, more positive endeavors - such as finding a better job, establishing a bonafide professional career or the ultimate - starting your own home-based business!
% % % %
‘’WHY, THAT’S HIGHWAY ROBBERY!'’
Yes, it is! It’s also city street, avenue, boulevard and country road robbery! We refer, of course, to the recent unjust (many say) and major uptick in gasoline prices. As we write this, news reports claim that in some areas of California, the price per gallon has topped $3.29 per gallon!
Homeowners are now also receiving the highest monthly heating bills of all time. Natural gas has been hiked an incredible 40% to 50% in some parts of the country. Until recently, $592.00 was the total of the average ANNUAL heating tab. Now, in some cases, it may well cost that much for a single month!
TIME TO QUIT BEING FUELISH?
Remember that old coined word? Clever, but we all got bored with it and it was eventually retired. Let’s bring it OUT of retirement! Let’s NOT be fuelish any more! How? Actually, ’tis not all that difficult - and the following simple steps can, in time, make a significant reduction in your on-going costs to run your car and your personal dwelling.
BATCH TRIPS. Each week - and in many cases - each DAY - we all need to go places as well as having places that we just WANT to go. Business, personal, errands, kid’s functions, and on and on.
A little bit of planning and many excursions can be combined, thus saving fuel and wear and tear on the vehicles and equally important - time. Why take two cars and go off in the same direction or even different directions, if it’s possible to line up the errands and take care of ‘em in one fell swoop?
Often, the telephone, fax or e-mail can better take the place of a physical meeting. Savings over time are astronomical.
The usual stuff, like making certain tires are properly inflated, not taking off or stopping like a NASCAR combatant, and similar actions can help mitigate fuel consumption.
Does your car absolutely require a high octane gasoline? Most today, do not. I have always pumped the ‘’good stuff’ in my cars - Rolls-Royces must have it, and many others such as Mercedes and the like recommend it. I read the manual recently for S.E.’s Lexus and my summer fun car, the red topless BMW. Turns out, we can burn the 87 octane in both rather than the much more expensive 93!
Most all bank credit cards, such as VISA, MasterCard, etc., offer an option where you pay a small annual fee (which often can be waived if you insist on it) and this affords you a running monthly discount of upwards of 5% or so. Generally, you need to designate one particular retailer for each card.
We have one each for different retailers and one is for a multi-functional retailer that offers a full line of groceries, dry goods AND a service station. Thus, a $3.00 per gallon cost is instantly reduced to $2.85.
I also noticed that certain major oil companies are ballyhooing their own credit cards which also offer decent discounts when the card is used at their pump. Shell just had a promo offering a nifty 15% discount! Thus, a $3.00 per gallon price would be reduced to $2.65!
In one’s home there are even more opportunities to conserve fuel and money:
Does your furnace have a functioning humidifier? Many do not have such an animal or if they do, they hardly are ever clean enough to work properly. A humidifier, if maintained (and depending upon the hardness of the local water, that may require a monthly inspection and cleaning) will significantly contribute to lower heating costs.
As the heat is humidified, the sensation of warmth is enhanced. Thus, when the thermo-stat is set at say, 68 degrees WITHOUT a humidifier, one might feel cold. (Especially, as I’ve discovered over the years, if ‘’one'’ is a FEMALE! Women always want to up the ther-mostat, whilst most men want to turn it down).
But add a good humidifier and generally, the thermostat set at ANY temperature will be two - four degrees higher than one needs to feel comfortable. In short, when the thermostat is turned down a couple notches you are saving $$$ - yet not suffering in any way.
Many advocate those computer-controlled (and quite pricey) thermostats which can be programmed to turn the heat up or down at any interval one selects. That’s fine, but we’ve had ‘em, tried ‘em and I hate ‘em! I prefer to have a plain old Honeywell manual type which I can walk past and dial up or down at will. Warning: Doing so drives ALL wives crazy - no matter how congenial they otherwise may be . . .
It’s a habit worth pursuing, as you can better control the true usage rather than your computer’s preconceived idea of what it should be. When it’s cold - the thermostat is upped - doesn’t matter what was previously programmed. If it’s warm - down it goes.
Fireplaces can be a source of major heat loss. First, I suggest the glass door type enclosure which can be shut when not in use. If the fireplace is not used on a regular basis, the the flu can also be shut, preventing even further heat loss.
Many water heaters are gas-fired (natural or propane). Even if heated electrically, great savings can be had by taking the time, effort (and some money) to wrap both hot and cold supply pipes throughout the entire house - but starting right there at the water heater, itself.
The water heater can be wrapped in a commercially-produced fiberglass insulating blanket that can often he had from one of the home improvement centers for a few dollars. Be sure to follow the instructions - and cut out around the burner door!
One of the best ways to conserve heat and slash you monthly $$ output is by getting a roll of fiberglass insulation designed to affix to the round and larger square heating supply ducts - whether the same are in the attic, crawl space or basement.
Enormous quantities of BTUs are dissipated every minute of the day through uninsulated duct work. Probably, someone has done a study on it somewhere, but I wager that annually, in the U.S. alone, we waste enough fuel through just that one drain to heat all of North America for a few years.
We’ve talked before about conserving water in general - in all ways possible, as it is a scarce commodity in some parts - and increasingly expensive to produce, condition and deliver to our individual faucets. Additionally, water must be heated for various applications such as washing clothes and dishes, baths and showers, etc.
Again, if we can figure out how to use less water -especially heated water - we can save on our utility bills. Several ways come to mind:
Most toilets today are mandated by law to use only 2 1/2 to 3 gallons per flush. The newer models have (finally!) been engineered to work quite well with that reduced gallonage. Older models, generally require 7 gallons per flush.
The old idea of putting a brick (or other dense bulky object) in the tank still works. It cuts down on the amount per tank that CAN be utilized. Also, just bending the wire of the ‘’float'’ works similarly. Some toilets are supplied by HOT water rather than cold, so any conservation is worth noting.
Any new shower head that you buy today, probably, has a built-in water-reduction device - even the so-called ‘’shower massage'’ units. This slashes hot (and cold) water consump-tion to a large extent - especially, over a period of weeks and months.
All my life I’ve turned on the hot water and let in run whilst brushing my teeth. (Well, at least starting when I left home at age 16 and had my own place. Until then, none of my folks - parents, grandparents or others even HAD hot water!) Nowadays, I use cold water. Big deal. Well yes, it is. A houseful of people doing that can save a couple hundred bux every year!
Have a dishwasher at home? I mean, the machine kind - not your wife! (Very old joke there.) Well, if you’ve used a dishwasher for a very long time - as many have - you may not realize two things:
The act of getting dirty dishes prepared to put IN the dishwasher, then doing so, and later taking them out, removing any ick or water residue that remains and putting everything away in the cupboards is actually far more time-consuming than just washing the darn things right after usage and drying by hand.
Not surprisingly, the cash savings on the hot water you do NOT use in the dishwasher are extraordinary! Another couple hundred or so bux every year go in your pocket rather than (literally) down the drain!
When we remodeled BLUE HERON POINTE recently, we decided not to even bother buying or installing a dishwasher. There’s a cabinet just-the-right-size for installation of one should the next owner want one - although, S.E. has declared more than once, ‘’We will NEVER sell this place!'’
Modern clothes washers have several energy saving devices including reduced water usage for smaller loads. Some are automatic but others require that the user push a button or turn a dial to adjust. Ditto for choice of cold and/or hot water. Several combinations generally offered.
S.E. tells me that for most wash loads the cold/cold setting is fine. (I’ve always used the hot/cold). This saves a lot of hot water and thus, cuts fuel consumption. We wash a load or two every day - never could figure out if that means we’re really dirty - or really clean . . .
Those easy steps we’ve outlined above may seem hardly worthwhile taking, but I can assure you they are. Not much of a big deal taken individ-ually, but just like pennies that soon add up to dollars, given time, prudent fuel conservation actions can result in massive
cash savings for you and yours.
% % % %
STILL RENT YOUR HOME? YOU NINCOMPOOP!
That was my very first idea for a title for this article - and it seemed so Bpropos - and I liked it so much - that it is also became the final one!
If you’ve been with me for any length of time, you know fully well that first and foremost I believe that every DAX-DOER must acquire their very own home before any other genuine success will take place. It may be a modest dwelling in the beginning, yet it may seem like a financial burden.
It may even appear to be one of those ‘’luxuries'’ that one sets aside on their ‘’wish list'’ for a more prosperous time. But in the final analysis, it is a MUST if one is to succeed in any significant way, shape or form. Period. Why?
When you own your own home - and understand, that may be just a trailer somewhere, or one half of a duplex or the smallest apartment in a larger building - but if you OWN (which also means, of course, that you AND the bank or the contract holder ‘’own'’ it jointly) you are on your way, my friend - you are ON YOUR WAY!
A personal residence serves as a genuine ‘’power base'’ - providing you with a perceived as well as a genuine substance in the community and in your own mind. Most really successful entrepreneurs come from poverty - that’s just a fact, Jack. Perhaps, their folks never even owned a home - just rented here and there all their lives.
Therefore, it may not seem like an imperative to someone wanting to ‘’get rich'’ to first think in terms OF acquiring their own abode. But believe me, it is essential!
To underscore the above, here are some real stats: When you compare the true NET WORTH of various people with differing annual income the advantage to home ownership becomes apparent:
Folks with an annual income of a mere $16,000.00 will, on average, have a net worth of $73,000.00 IF THEY ARE ALSO HOME OWNERS but other people with the same meager income have a net worth of darn near nothing - $500.00!
As you scale the income ladder, people with a $50,000.00 annual income, on average, are worth around $194,621.00 whilst their renting counterparts have but $25,000.00 in true worth.
And when we get to the $80,000.00 annual income range, those who rent average total assets of just $87,400 whilst the home owner is approaching a cool half million bux - at $451,200.00!
There are many additional reasons why home ownership provides so many opportunities, but some biggies are:
Large tax benefits are enjoyed - especially, as regards being able to deduct any interest costs.
Properties inevitably appreciate in value over time - averaging a 6 percent increase over the past three decades.
Accepting the responsibility of a mortgage literally forces you SAVE MONEY! You must make your payments every month or lose your home. In so doing, you are adding to your overall personal estate value.
Here’s how all that could work for you in realty-reality!
Assume that you purchase a house costing $170,000.00 and in fact, it appreciates at the average of 6% annually. At the end of ten years you will own a property worth over $300,000.00. Let’s say that you originally made a down pay-ment of $17,000.00 (10% of the purchase price).
Since your actual equity at the end of ten years would be about $151,000.00 - and not even factoring in the equity build-up realized from paying down your mortgage - your initial down payment would literally be worth a phenomenal 24% per year for each of the ten years!
The foregoing are all things that you can ‘’add up'’ - with or without a calculator. But the true benefits of personal home ownership go much further - especially, to the entrepreneurial type or those just wanting to be an integral part of the community.
Other homeowners look upon those who also own their own homes with greater respect - it’s just natural. How do you attach any serious bonafides to a person or persons who merely rent the place next door, move out in the middle of the night or fail to maintain the property in even a cursory, decent fashion?
Thus, if you are in the early stages of a new career or business of your own, just the fact that you state boldly (or perhaps, even better, matter-of-factly!) that you own your own home - whether on a loan application or as just part of your background resume data - establishes you as a solid person to be trusted in the eyes of other important people in your community.
Thus, as I have ‘’preached'’ for years: When you set out in life to become successful - at anything -make certain to acquire - as early as possible - your very own home. This is something you will find in much of our advanced literature as well - including DAX methods to do so without ANY money of your own!
% % % %
PMS . . . BAD! PMI . . . GOOD!
Well, PMI is good, that is - once you get rid of it! (Sorta like PMS, now that I think of it . . . )
We’re talking here about Private Mortgage Insurance (PMI) which is often a requirement for a home buyer who cannot come up with the standard minimum 20% down payment that most commercial lenders demand.
Now, allow me to interject THIS thought: When you follow the well-established and long-espoused DAX-method(s) for wheeling and dealing in real estate you never need worry about such things, as DAX-DOERS generally get all the properties they want with very little or usually, nothing up-front!
But . . . the fact is, most Americans do acquire their homes in more traditional (and costly) ways and thus, often end up with that PMI bugaboo which is very costly. It is an insurance that protects the lender - but it is the buyer who pays the premiums - sometimes amounting to well over $100.00 per month.
The thinking behind PMI is that, since the buyer has not invested very much of himself (specifically, his money) he should provide protection to the lender just in case he decides to ‘’take a walk'’ and leave the property vacant and monthly payments unhonored, etc.
What a lot of folks do not realize is that PMI may be a good or at least necessary evil when making the initial purchase, but it is NOT mandatory for it to remain indefinitely.
In fact, in just about every case analyzed, PMI can be dropped relatively soon after the purchase is made - within a couple years or so, although in some cases much sooner. Example:
A study by HomeGain.com found that an Indian-apolis buyer who acquired a median-priced prop-erty at $101,541 with only 10% down saw his house equity grow to 23% (well over the minimum of 20% figure) just two years later at $114,500.
That means the lender can no longer demand the PMI coverage, because the increased value of the property affords him the same (or even better) protection.
Which means, the buyer can cancel the PMI and save all those monthly premiums which as stated earlier, can add up considerably. It used to be that homeowners had to rely on folks like us to tell them about this fact - and we have several times over the years.
Today, under the Homeowners Protection Act of 1998, conventional loan providers (not land contract or similar loan vehicle-types) are required to remind their customers annually that they have the right to seek cancellation of PMI when the basic requirements are met.
Incidentally, that law does not pertain to VA or FHA loans as those still require such insurance to be paid for the life of the loan: Buyer beware, there - as we’re talking tens of thousands of dollars just frittered away, in my judgment!
There is such a thing as an ‘’automatic PMI cancellation'’ which if applicable, informs only to loans originated after July 29, 1999. In short, don’t count on anyone ‘’doing the right thing'’ and advising you of your chance to drop PMI as soon as possible.
Again, we’re talking about significant sums of real cash here that you can save and use for other purposes.
What to do? Carefully review your mortgage contract. Contact the lender. Ask pertinent questions. Arm yourself with recent realtor-generated data on property values in your immediate neighborhood.
You may also go to this website for a PMI calculator - to help you tailor your own numbers: www.chiicagofed.org (or) The Mortgage Insurance Company at: www.privatemi.com
No doubt, at one time or another, you’ve considered refinancing your home loan - to take advantage of one of those teevee offers to ‘’squeeze some money out'’ for whatever purposes. Well, sometimes that may make sense - especially when interest rates have plunged, perhaps.
Otherwise, it can be costly to do that. As an alternative, just getting that PMI cancelled may save you enough money every year so that you won’t need to go further in debt with a loan refinance. Worth looking into.
% % % %
SOMETIMES, ‘’PAYBACK'’ CAN BE PROFITABLE FOR THE PAYER!
In this instnace, we’re talking about here and now is an esoteric way one can increase their Social Security benefits significantly over the years of receiving all those monthly checks. Simply stated:
If you or a relative decided to start benefits at any time before the usual retirement age of 65, you probably know that the amount Uncle Sammy will send you is reduced rather considerably depending upon when you start your benefits.
We have discussed previously the pros and cons OF starting one’s benefits one to three years before ‘’normal,'’ because one is eligible to receive (reduced) benefits as early as age 62.
As an overview of that, our position is that in most cases it would be preferable to start the benefits coming as soon as possible. After all, there are many factors to consider - both controllable and beyond one’s control, such as:
Let’s say that by waiting until 65 you would receive $1500.00 a month, but if you jumped the gun and started receiving monies when you turn 62, you’d receive only $1,000.00 (Figures not exact, by the way). Between 62 and 65 you would receive a total of $36,000.00.
When you reach 65, you would still receive ‘’just'’ $1,000 each month for the rest of your life - allowing for the usual annual increases in benefits due to inflation, cost of living raises, etc.
But consider: If you do the above, once you do reach age 65 you will be ahead of others who waited by a full six years, because it will take them until age 71 to make up the $36,000.00 you have already received. Thus, nine years after you got your first $1,000.00 monthly payment from Social Security, you and your fictional counter-part will be ‘’even-Steven.'’
One obvious variable to consider: Do you reason-ably expect to live that long? Well, I hope so - and IF so, then you may well want to consider the centerpiece of this article - which I’ll get to in a second. But first, another variable:
If you elect to take your SS at 62 and sock away all monies received, factor in either the interest that you will be earning on those sums as they accumulate or the potential investments where you may decide to place those funds.
There is another ‘’far out'’ consideration which I personally do not predict, but many younger people certainly fear: That the Social Security fund will simply go bust in a few years and no one will get any more $$ - hence, you should get all you can whilst you can!
But here’s that little-known option I wanted you to know about:
At any time between when you start getting benefits at an earlier time (than age 65) and 65 - you may contact the Social Security Administration, inform them that you wish to pay back 100% of the monies they have sent you up until then . . . and . . . as a result, now that you’re 65 you will qualify for the full monthly benefits which then pertain - for the rest of your life!
Essentially, it’s as if you had never signed up nor received any monies before the age of 65.
Using our previous example, you would be paying back about $36,000.00. Actually, somewhat more: 36 months X $1,000.00 monthly PLUS whatever ‘’upticks'’ Uncle Sammy deigns to send you with annual cost of living increases.
Based on THAT, the original $1,500.00 you would have gotten had you waited the three years until reaching 65 will then probably be closer to $1,600.00 per month for again, each month as long as you live.
All this is vital data that you and yours should carefully consider. Have a chat with the Social Security folks, also, and visit their website at WWW.SSA.GOV Using our example:
If you live to 100 - and currently, in the U.S. alone there are over 50,000 Centenarians(!) - the extra monthly $$ in our example will amount to well in excess of a quarter of a MILLION dollars when you add in the extra monthly payments, the annual upticks plus the accrued interest! Hey! Is THAT enough to get you to spring for a renewal of your subscription to this cotton-pickin’ n/l?!
% % % %
HERE’S A SWEET-SOUNDING ‘CD’ . . .
At any given time, there are a lot of people, companies and organizations vying for your investment dollars. Naturally, you are interested in getting the highest return possible whenever you deposit sums of money for extended periods of time.
There are a lot of land mines to negotiate to avoid getting tied up for too long at a less than desirable rate or worse still, losing part or all of your capital. It can and does happen frequently. Here are some considerations:
All sorts of financial institutions offer Certificates of Deposits (Cds). First off, make very certain that the CD will be insured by the FDIC (Federal Deposit Insurance Corporation) - the arm of the Federal government which guarantees that your capital (up to $100,000.00 per CD) will be returned to you if the institution should fail.
That may sound elementary, but you’d be surprised (perhaps) to learn that a number of Cds are NOT FDIC insured! Verify that yours ARE!
Often, your local credit union will offer considerably higher rates of return than the bank or savings & loan next door. Recently, rules for joining many credit unions have been relaxed: You may be able to join one that previously turned you away. Some credit unions will take you on if you merely have a relative who works for one of the member companies, even if you do not.
Most reasonably large daily newspapers will publish, at least once each week, a list of all local banks, credit unions, etc. plus, the rates they are currently paying for 1 year and 2 year Cds. Check ‘em out. Be careful to note whether on large (sometimes called ‘Jumbo’) Cds the rate is higher, lower or the same. Data can be confusing and you need to clarify ahead of time.
Currently, we find that many rates are better on 9 month terms rather than a full year or longer. We’d hate to tie up funds for much longer than a year anyway - unless it was a really great rate, of course! With impending 2000 election, a somewhat unsettled stock market, it is difficult to predict long-term interest rates now - even more so than during more ‘’normal times (whatever in the world THAT is!)
Some institutions have a relatively new gimmick whereby at any time during the term of your CD you may - one time only - call the bank and ask them to give you the prevailing higher rate for the balance of your term! This can mean a whole bunch of extra bux. Last year we had a jumbo CD on a 12 month term . . . noticed the rates had risen . . . called the gal at the bank and Whamo! An extra $1757.00 free cash money!
If you have more than $100,000.00 to park - perhaps, several times that, you can still protect all your funds under FDIC regulations in a variety of ways:
HOW TO MAXIMIZE FDIC PROTECTION
At the SAME financial institution, you may open more than one account on which your name appears but in each case, someone else’s name also appears. Perhaps, you and your wife. You and your child. You and a grandchild. You alone. Your spouse alone.
Individual Account: At the basic level, you open an account ar an FDIC institution and can deposit a maximum of $100,000.00 to receive full protection. That means (as we and others read it) that if the bank went belly-up after your hundred grand had accumulated interest of say, a few thousand bux, the most the FDIC would reimburse you would be for the initial hundred grand.
That being the case (and granted, there are conflicting views on it) we opt to configure the amount the initial deposit will accrue during the term we deposit at the percentage offered and essentially, just deposit that amount LESS.
Joint Account: This type of account is in the names of two or more people and each owner has an equal right to withdraw. Generally, these type of accounts also have survivorship rights. Joint accounts are also insured up to $100,000.00 but each owner gets an equal share of the insurance benefit LIMITED TO $100,00.00.
Theoretically, two people could (jointly) have $200,000.00 in a given account and be protected fully on the basis of $100,000.00 EACH if the spit hit the fan. I’d hate to test that theory, however.
Revocable Trust Account: With this sort of account the person who deposits the money can designate another person (known as the beneficiary) to receive the funds in the event the owner (original depositor) dies.
He or she retains complete control of the account and the funds therein whilst alive and, as with other accounts discussed, is insured up to $100,000.00 for EACH qualifying beneficiary (a spouse, child, grandchild, etc.)
Self-Directed Retirement Account(s): This type of account would include IRA (Roth or regular) Keogh plans 401K, etc. Again., each plan (even if multiple) is added to the other(s) up to the maximum of $100,000.00 total per person.
HOW TO HAVE ONE MILLION BUX-PLUS DEPOSITED IN A SINGLE BANK . . . YET BE FULLY INSURED BY FDIC!
It is possible - and legal: Using a man, his wife and one child the following types (and amounts) could be established in just one FDIC institution:
Individual Account(s):
Husband, $100.000.00
Wife, $100,000.00
Child, $100,000.00
Joint Account(s):
Husband & Wife, $100,000.00
Husband & Child, $100,000.00
Wife & Child, $100,000.00
Revocable Trust Account(s):
Husband in Trust for Wife, $100,000.00
Wife in Trust For Husband, $100,000.00
Husband in Trust for Child, $100,000.00
Wife in Trust for Child, $100,000.00
Individual Retirement Accounts:
Husband, $100,000.00
Wife, $100,000.00
Child, $100,000.00
TOTAL: $1,300,000.00
Personally I prefer to ’spread the wealth’ and use multiple institutions, but . . . now and then, a particular bank will offer a really great rate to get a bunch of my bux, so I’ll jump the hoops with the extra accounts to get both the nifty rate and the FDIC protection.
A QUICK MAJOR BUX-SAVINGS TIP!
If you have a mortgage on your home, it is probably your biggest financial ‘nut’ to crack every month . . . right? You may be able to shave the payment considerably if you were required to secure private mortgage insurance when you took out the loan AND . . . your equity in the property has (now) reached 20% or more of total value.
The mortgage company generally won’t bother telling you that you are no longer required to maintain the insurance, as they, no doubt, are getting a kick-back on the premiums you pay: So you’ll have to assert yourself and ask questions!
There could be a significant cash reward for doing that: A monthly payment reduction up to $100.00! That’s ‘found money’ that you can spend elsewhere, invest or just have a good time with.
A postscript secret: Let’s say you paid $100,000.00 for your home . . . made only a $15,000.00 downstroke so the mortgage company required that extra insurance. Time has passed, but as you know, the bulk of money from early year payments goes to interest - not principal.
Thus, on the face of it you may think, ‘’Heck, there’s no way I’ve made up the difference between the $15,000.00 downstroke and the $20,000.00 equity requirement.'’
Oh, ye of little faith! These are DAX-FACTS you’re reading here, remember?! All you do, is contact a couple area real estate people and get them to unofficially (that generally means ‘for free’) appraise your property. Probably have to indicate that you want the data as you are considering listing the property. (Who knows . . . after you discover how much the place is worth now - maybe you WILL list it!)
Chances are excellent you’ll find that the figures spike your equity far above the 20% requirement -and you’re home free: Take the stats to your lender and again, assert yourself somewhat - let them know YOU mean business - and the odds favor your ‘doing the deal!’
% % % %
TIME TO UNLOAD THE OL’ HOMESTEAD?
With the stock market, commodities market and our economy in general, being in such a state of flux of late - many people have been taking a closer look at real estate as an investment.
Traditionally, it has proven to be far less volatile than other financial instruments and as one example, in the year just ended, whilst prices for single homes (in the U.S.) have risen 10% - mortgage interest rates have been at their lowest in 32 years!
Now, bear in mind that we and certain other DAX-DOERS love the volatility of the stock and commodities markets, because we know how to profit from the downside equal to the up. Nonetheless, real estate has always been the bulwark of our own portfolio, as well.
It takes a real dummy to lose $$ on real estate (although, it IS possible and yes, I did so once or twice myself in my misspent youth!)
If you are thinking in terms of investing in real estate, the odds are, that you are already invested in it! I’m referring to your own home.
Currently, with our growing population, tighter restrictions on development in many areas, coupled with increases in land costs, material and labor - your home is probably worth far more than you paid for it - even if you’ve owned it for just a few years.
Perhaps, you have no interest whatsoever in selling, buying another house, enduring the (many!) hassles of moving, relocating, etc., etc. BUT, your home, if it has appreciated, represents a significant capital asset - one which, under current tax law, permits you to reap tax-free benefits previously not allowed.
As such, if you have other really good places to put your windfall - all may add up to putting a ‘’For Sale'’ sign on the front lawn.
If that comes to be, first, you might consider having a real estate professional perform a market evaluation of your home which will compare your home to others in the area that have recently been sold.
That gives you a fair prevailing value for your place and if nothing else, may make you sleep better tonight knowing what a wise investment you’ve already made.
If you do decide to actually place your home on the market, take some time, put forth the effort and spend a little money to spruce up the joint. Try to look at your property through the eyes of a prospective buyer. Take pains to do all those maintenance things you’ve been putting off:
Trimming shrubs, emptying closets, painting where necessary, replacing dingy door hardware and such. It’s really quite simple: You and the spouse just walk up to your own front door pretending to be strangers TO your house - and then, start nit-picking: Take notes. Be super critical.
No, you may not end up re-roofing the roof, or retiling the bathrooms, or other expensive items BUT surely, you will have a nice list of things you can easily and inexpensively execute that will make your home more appealing to a prospective buyer. Remember, to you it’s your home. To a prospect, it’s just a ‘’house.'’ Unless, you make it feel like a home.
Before we placed WINTERWOOD on the market last year, SuEllen and I spent several days, a bit of money but a fair amount of effort making certain everything looked ‘’right.'’ Some marble in the foyer was cracked. We bought replacement pieces, tore out the bad ones and replaced with the new. Big improvement.
We super-cleaned every surface - especially, in places that no one likes to find icky: Bathrooms, the sauna, Jacuzzi, all tiles, kitchen, etc. We cleaned and polished the crystal chandelier - a chore neither of us ever liked as it was frankly, dangerous (poised precariously on a scaffold a couple stories above the first ‘’soft landing.'’)
Anyway, the joint sold pretty fast - and frankly, for more than I thought ‘twould. (To her eagle-eye credit - it sold for exactly what S.E. said it would sell for!)
A word of caution: To MY ‘’eagle-eye'’ credit (or just a lot of experience) we did not place either our main residence or our lake cabin on the market until we had secured (for sure) the place where we now reside, BLUE HERON POINTE.
True, all that can be expensive, and in our case we just bought the place and then put the other ones up for sale. But, one could come down in the middle of that equation somewhere by perhaps, placing an option to buy on ‘’the'’ place that one wants and make it contingent on the sale of the original abode.
I say that, because in our own case, it literally took us the better part of three years to find exactly what we wanted and had we first sold WINTERWOOD or the cabin we’d not had any place to live!
Look, with the current super-hot real estate market - despite a small show of weakness in the past two months - you have a marvelous asset in your very own home! If you decide not to sell it, you could use to raise funds (if needed) for other investment projects - real estate or otherwise.
% % % %
‘’USE IT UP, WEAR IT OUT - MAKE IT DO OR DO WITHOUT.'’
Most readers will (probably) never have heard of that old Amish saying - one from the earlier part of the ‘’last'’ century that even the ‘’English'’ (non Amish) heeded. Our grandparents and great grandparents knew all about having to conserve resources, save precious bits of money, clothing, fuel, food and anything an everything else that was ‘’hard to come by'’ for many, at certain times in our collective history.
Today, IF one is prone to save a few bux here and there, they may well be considered either frugal or downright cheap. Indeed, it may require a bit of resolve as well as a healthy self-image and a desire to conserve money today for after all, we live in a time when there seems to be an over abundance of just about everything and very few feel the need to save a few dollars here and there - let alone a few pennies now and then!
Nevertheless, as we have pointed out time and again, a few dollars saved, invested or simply held for the long term can - in time - amount to significant sums - hundreds, thousands - even millions of dollars.
Recently, a couple marketing professors conducted a survey and discovered that, as we indicated, ‘’frugality'’ in virtually any form is an alien term to most Americans today. It has simply just been a very log time since most have suffered any serious financial setback or lack of material goods.
By actual count, less than 10% of the current population could be considered ‘’frugal.'’ You may count ME in that small number - and I’m proud of it! By BEING frugal - refusing to just throw away or give away the ‘hard-earned’ - allows me to do all the many other things that I enjoy doing - which some - well okay, MANY, would consider wasteful.
FRUGAL VERSUS CHEAP
That survey mentioned earlier turned up some interesting situations: One woman who considered herself 100% frugal in every way was astounded to hear that a few others had outdone her. For example, she had never heard of rinsing out a Ziploc bag so it could be used a second or third time. Some people actually sew up torn bags!
Frugal people may buy a generic paper towel rather than the pricey variety, but a super frugal person would use cloth towels, instead, wash and reuse them. CHEAP folks wash, rinse out and reuse the PAPER towels!
Years ago, in an episode of the Jack Benny Show (and you will recall that Mr. Benny, who shared MY birthday, Valentine’ Day, was reputed to be the cheapest person in the world!) was informed by his servant, Rochester, that they would need to buy a new dishwasher because the old one had been ruined, Why? Because the paper plates had gotten caught in the plumbing . . .
HELPFUL BUX-SAVINGS TIPS
It has been my personal experience that the BEST time to cut waste, save money and conserve precious resources is when you seem to have the most of everything you could ever want!
Certainly, at a time of prosperity, the natural tendency is to not be concerned about such things so, adhering to my personal lifelong propensity for ‘contrarianism'’ - that’s precisely when it’s a good idea to be conservative. Lots of ways:
Keep your eye open for genuine bargains - not penny ante stuff - but close-outs, special offers and other opportunities where many dollars - hundreds - perhaps, thousands can be saved in one fell swoop.
Sure, it’s fine to save a few nickels and dimes when you can - but almost every day there are chances to buy a large ticket item for far less than the usual price. We’re talking about cars, appliances, furniture, tools and other expensive things.
Consider ‘’used.'’ I do no care for other people’s junk - but there are rare occasions when some things that have been ‘’pre-owned'’ may be worth looking into. These MAY include costly pieces of jewelry, watches, etc. Most people who love antiques don’t give a second thought to the fact that several other people have owned, handled and enjoyed the piece in question.
That thinking may prevail and be carried over to automobiles, houses and who-knows what. I was all set to go out and blow $700.00 on a new Sony VCR when S.E. brought home one that looked (and performs) like brand new - for a paltry $100.00. A friend of hers was moving and selling off all her ‘’stuff.'’
Secondhand stores that feature clean used clothing and other articles may save you a fortune over time! I constantly receive reports of name brand - even fashion merchandise that originally sold for many hundreds of dollars being available for $5.00 - $10.00! Some still have the price tags attached!
To CONSERVE resources one already has is even easier: The thermostat goes down a few notches in the winter - up in the summer - two to three hundred dollars are saved annually - and the occupants of the dwelling are statistically far healthier, to boot. House and car insurance costs can be slashed by increasing the amount of risk YOU are willing to accept vis-B-vis deducible amounts.
Just shopping around FOR insurance rates scan save significant sums in many cases. A fast and easy way to do that is via the internet - starting with: www.insweb.com www.progressive.com www.insuremarket.com www.rightquote.com www.quotesmith.com
Simple things such as paring back on the number of cell phones, the extra premium cable channels, perhaps even an extra vehicle or two can add up to extraordinary savings on an annualized basis which can, over the years compound to a small fortune in saved money as well as the EARNED interest or other profits to be realized from investment.
Take advantage of ‘’deals,'’ even if they seem picayune. Recently, I wanted another on-line brokerage for certain trades that I did not wish to mix up with my other accounts. In checking out several, I discovered that one offered a 100% free bonus: A Full year of AOL. That’s about $250.00 FREE MONEY!
A couple months later, they sent me another offer: For every $10.000 deposited in my account, they would credit me an additional $60.00 up to a maximum of $300.00. So I wired them fifty grand and picked up an extra three hundred bux of free money!
Always send in the rebate coupon deals - $10.00 here, $40.00 ether - sometimes as much as $100.00 on certain deals. Why not?! Compound all those offers and before long - there’s some pretty substantial free bux coming your way! It can pay to be ‘’cheap!'’
All of the foregoing reminds me of the old joke: A doctor tells his patient that he can remedy the man’s problem in one of two ways: The first, basic surgery that will cost $1,000.00. The second, more complicated surgery that will cost $10,000.00. The man does not hesitate and says he definitely wants the more expensive remedy.
A few weeks later, fully recovered from the ordeal, the man is confronted by his doctor who wants to collect his fee. ‘’Oh. I couldn’t possibly pay you that much money!'’ Aghast, the doctor says, ‘’Well, if you could not afford the procedure, why in the world did you choose it over the lesser one?'’ ‘’Oh, that’s easy: When it comes to my health - price is no object!'’
% % % %
TERRIFIC TAX TIP . . . SELL YOUR HOUSE: SAVE & SAVOR!
One of the greater benefits of the most recent (1996) major tax reform legislation permits a homeowner who sells his residence at a profit to KEEP that profit without having to fork over a large portion to Uncle Sammy.
A single person can keep up to $250,000 of pure profit whereas a married couple keeps as much as $500,000. No roll-over requirement gimmicks as in yesteryear.
The only requirements are straightforward: The property must have been your primary residence for at east two out of the previous five years. Even if that is not the case, under certain extreme hardship cases, such as the house having to be sold for health, job or other ‘’unforseen reasons,'’ you may be able to keep at least part of the profits tax-free.
Currently, the cap is either the $250,000 or $500,000 depending upon marital status, but that is a sizeable sum and probably subject to upward revision in the years to come. This major revision in tax law has caused a considerable spurt in home sales the past few years, and is said to account for as many s a half million of the nearly five million record home sales in 1999.
No wonder! The tax break can mean a considerable extra amount of money to older people especially, at a time when they can probably use - maybe, even ENJOY some of the fruits of their efforts and good judgment in acquiring a personal residence in the first place!
% % % %
HEALTH & WEALTH: SAVE BIG $ ON YOUR HEALTH INSURANCE!
For the past couple administrations we’ve heard the Washington politicos rant ‘n rave about how there should be blanket health insurance coverage for all Americans - and the best example of how likely that is to happen any time soon can be seen in the aborted Hillary-Billary health reform program that turned out to be a horribly bad joke - as did her husband . . .
Meanwhile - whilst a few wide-eyed types wait with bated breath in the hopes they will no longer have to fund their own health costs - virtually all such costs just keep spiraling toward the heavens.
Even if there ever comes to pass a ‘’Big Daddy Warbucks/socialized medicine'’ scheme in the U.S. - many of us would probably prefer to continue with privately funded insurance plans of our own rather than be prisoner to the Crown as they are in England and Canada.
Here then are some solid methods to save on YOUR annual health care costs - monies that you can either have fun with, invest in your future or just sock away.
If yours is currently a traditional health insurance policy, the chances are that you can save 12% - 15% or more of your monthly premiums if you either switch to another company or see if the company you are now insured with offers a ‘preferred provider’ plan.
That means that the insurance company has contracted with certain hospitals and doctors and you can only go to those places rather than choose your own. However, in most all cases the list of participants is lengthy, probably includes the doctor or hospital that you currently consult.
Enormous annual savings of many hundreds of dollars may be thus realized.
Try to join an organization that helps members buy insurance at lower group rates. When I joined Blue Cross many years back, by waiting an extra two or three weeks, I was allowed into a group that was joining en masse and saved about 10% on my premiums ever since.
You may have a fraternal, church, credit union or other group that you can join and save big. Sometimes, the savings are not on the premiums but rather on the percentage of deductibles.
For example, on your own you might have to cough up a 30% co-pay. On a $100,000.00 hospital bill you’d have to pay $30,000.00. On a group plan, you may be paying the same premiums as a private plan, but your co-pay may be as much as 10% less. In our illustration you would therefore save $10,000.00 in actual cash!
If, like me, you mainly purchase (any kind of) insurance to provide peace of mind in case you suffer a major loss, rather than for it to pick up the cost for every little sniffle, flu shot or what-have-you . . . and if you and your family are in fairly good overall health, you might want to consider raising your deducible. To give you an idea of the savings, here is an example from just one insurance carrier:
If the premium were $310.00 per month on a policy with a $500.00 deductible, by increasing the deducible to $1,000.00, the premium would drop to $270.00. If the deductible were upped to $2,500.00, the premium would be a mere $215.00. That would save $95.00 per month - $1,140.00 per year!
Even though you may not consider it ‘your problem’ or ‘your money,’ if you incur a visit to the doctor and/or hospital and notice that a subsequent invoice seems wrong, check it out. Call the doctor and/or hospital and ask them to go over the figures with you. If you notice a huge discrepancy, squawk to the high heavens!
Recent national exposPs reveal that almost EVERY hospital bill has some errors in it - usually, several that may add up significantly. Doctors (and dentists) also make errors - and I have yet to see one made in MY favor - have you?
Sure, your insurance carrier may pick up the tab, but if you can point out to them errors that will save them money - in the end, you, the insurance company and all the rest of us win.
Some insurance carriers will offer you the option of letting them decide whether an expensive operation or other medical procedure is absolutely necessary. It’s called ‘pre-certification.’ If the company certifies that the work is necessary, they will pay for it. If not, they won’t.
If you and your medico are fairly certain that you need the treatment, this is a fairly good risk to take on your part. Some companies will authorize (and pay for) two different professional opinions.
Not all insurance companies are alike! It’s very difficult to sort through the nuances of each, so instead, rely on a trusted insurance agent - hopefully, someone you and your family have used for years.
Possibly, your car insurance agent or your house insurance person. They may not actually represent or sell insurance for a health carrier, but the chances are because of ‘being in the business’ they will know much more about the various heath insurance carriers than you.
And certainly, they will not knowingly steer you wrong at the risk of losing all your other business. They should be able to tell you where the best deals are, which companies honor claims promptly, etc.
OTHER COST-CUTTING TRICKS
Visit your doctor only when you know it’s necessary. But do not put off seeing him or her when you sense you really should. Some problems affecting the heart, kidneys, lungs, etc., are best treated early on and not only do you stand a better chance to recover - so does your wallet. If you must co-pay any costs involved, total treatment expenditure should be much less than if you waited too long to get treated.
We’ve mentioned this one before in another article, and many DAX-DOERS have written to express their appreciation: Ask your doctor about getting your medication for free. This is NOT a charity deal:
All the major pharmaceutical manufacturers supply the nation’s doctors with millions and millions of dollars in sample drugs of every kind, and any doctor will be glad to give it to a patient - if they simply ask for it! You may save hundreds every year just by opening your mouth BEFORE the pills are bought instead of after!
About drugs: If you do buy them, be sure to always ask for the generic drug instead of a brand name. Savings range from 50% to 70%!
You may also elect to buy certain drugs via the mail and save a great deal over purchasing locally. Here are some of the better known mail order drug firms and their toll-free numbers:
Action Mail Order: 1-800-452-1976
American Association of Retired Persons (Pharmacy): 1-800-456-2277
Family Pharmaceutical: 1-800-922-3444
One-800-Pharmacy: 1-800-374-2762
You’ll find a host of great lower-cost sources just by plugging in basic data into your search engine - such as ‘’mail order drugs,'’ ‘’pharmacies,”'’discount drugs,'’ etc.
If you are a senior citizen, most major drug chains offer significant discounts. Even then, shop the stores in your local area if that’s where you prefer to get your prescriptions filled. Percentage differences in cost between one store and another a block away may be mind-blowing!
If you’re a do-it-yourself kind of person, you will want to read up on the medical insurance/health care/drug fields and here are three good reference books which you could buy or better still, check out for free at your public library:
THE NEW YORK TIMES GUIDE TO PERSONAL HEALTH, by Jane Brody, $12.95, Avon Books.
GETTING THE MOST FOR YOUR MEDICAL DOLLAR, by Charles B. Inlander & Kathy Morales, $15.95, Pantheon Books.
HMO’s: WHAT THEY ARE, HOW THEY WORK & WHICH ONE IS BEST FOR YOU, by Jill Bloom, $9.95, The Body Press.
FINAL FACTS OF THE MATTER
The subjectof health care may seem unimportant to the younger reader, or toone who has never been forced to fund their own coverage. But we feel that every DAX-DOER has a duty to them-selves and their family estate to better understand the impact of the situation as health care is a major part of your annual expenditure whether you realize it or not! Check this out:
Your housing costs the most . . . 27%
Food is second . . . 18%
But health care is third . . . 15%!
All other expenditures, such as clothing, recreation and travel, personal stuff, etc., are very tiny amounts by comparison. So any time you can cut your costs significantly (as we have just shown you how to do in this article) you’d best be taking advantage of it!
% % % %
STUDENTS . . . LEARN THIS LESSON WELL: YES, YOU DEFINITELY CAN GO BANKRUPT ON YOUR STUDENT LOAN!
In the nearly forty years since 1966 over 40 million students have borrowed in excess of $270 BILLION in federal student loans to fund secondary education, according to Erin Love, the media rep for the Student Loan Marketing Association.
Tuition costs today are astronomical so it should come as no surprise that 82% of medical and law students, for example, graduate with a debt averaging $80,000.00! Many graduates leave school with a sheepskin in one hand and a huge debt in the other - often compounded with several years worth of accumulated credit card debt, as well. Indeed, the average monthly balance of all student credit cards is nearly $600.00.
The upshot of all this? With a minimum of 8% of the graduate’s income being required to service such debts the anxiety level can grow to a point where some find it difficult to function.
BUT THERE IS RELIEF
Many hapless graduates, laden with debt, are unaware of several remedies - and I’ll guarantee the final one we will show you is unknown to just about everybody in the land including the highest-priced attorneys!
It is possible to have a student loan either cancelled or deferred. For example, teachers who serve certain populations that include low-income or disabled students - may well qualify to have their student loans cancelled.
Communities in desperate need of health professionals will often pay off student loans if the person agrees to a minimum of two years service. A prime of example for that was the young doctor on the old ‘’Northern Exposure'’ teevee show:
He had to move to Alaska and practice in a small community to qualify, but his loans were waived entirely for doing so. The National Health Service Corps is the organization that oversees that. The total benefits are capped at $50,000.00, but hey! A ‘’free'’ fifty grand IS fifty grand, after all! For more data on that go to: www.bphc.hrsa.gov
In a ‘’tight market'’ it is not unusual for a well-heeled company, eager to get the services of a really great graduate student - to pay most or all of any outstanding student loan balance. They recognize that a debt-free employee will be worth far more to them in the long run or, it may be just that one final incentive to recruit the ideal candidate.
Most people at this level of education, intelligence and integrity will be self-reliant and may not even consider that another entity would consider paying for their obligation - especially, one so large - but that may well be the case and is certainly one worth investigating.
Finally: You won’t believe this - and again, most lawyers and all others neither know about it nor will believe it BUT: It is 100% possible to discharge a Federally guaranteed student loan through bankruptcy!
YES, ’tis true! Most anyone you contact will not have the details so it would require a fair bit of searching to find someone to handle it but it can be done - and it IS totally legal!
And I have pesonally known good people, financiall strapped because of burdensome student loans to be totaly freed of that debt (over $100,000.00 in the case of one doctor) via personal bankruptcy!
Banks, loan counsellors, etc., will not rush to fill you in on the details - and if pressed, may actually declare that it’s impossible or they have never heard of such a thing. But it is available as an absolute last resort and should not be overlooked if that is the only alternative. We’ll try to get more info on that for a future follow-up.
% % % %
BUY A HOUSE WITH ‘’0′’ DOWN!
Over the years we have presented articles and even entire books on the long established technique of acquiring properties with little or nothing down. And without fail we always hear from people who say they just do not believe it is possible. My suggestion to those people: Get off your duff and instead of writing me a letter telling me what you can NOT do - go out there and see what you CAN do!
It is simply a plain FACT that in virtually every community in America - and yes that DOES include the really ‘’hot'’ spots such as Honolulu, Las Vegas, Phoenix and Washington, D.C. - there will be several - sometimes, dozens of opportunities to acquire really decent houses and/or apartment properties with virtually NO down payment!
In a recent mid Michigan Sunday paper I found 14 such - and two were in the absolute best section of one major city - which I know, because I owned a couple premium properties there myself for nearly thirty years!
Now, aside from the fact that the quickest and easiest way to acquire a property with nothing down is by dealing directly with the seller on a land contract basis, there is also available to some a VA mortgage - one of the best available.
Under its ‘’Flex 97′’ program you can get as much as a quarter million dollars in mortgage money with only a mere 3% down and the best thing about that is the 3% can also be borrowed - from any source - including your credit cards.
In all markets - ‘’tight or loose'’ - there are always people wanting to unload their home for one or more of a variety of reasons. People divorce, die, retire, just want to move on, etc., and have no time or patience to go through regular channels to dispose of their property. Others simply prefer to carry back a contract and realize their principle plus interest on the installment basis.
If you are desperate to acquire your first home or if you wish to build a large inventory of houses for rental or resale - bear in mind that many home owners are more than anxious to do a deal pretty much along whatever criteria YOU establish and if that means, ‘’Hey! I’ll buy your property with no money down and relieve you of all responsibility here on out!'’ - you probably will have yourself a deal!
% % % %
SOMETIMES, IT IS GOOD TO AGE (IT WORKS FOR WINE, AFTER ALL!)
There are definitely certain advantages to be enjoyed at each of the various stages in our lives and scientists tell us that essentially, you and I change drastically every ten years. You probably recall making a giant leap in the way you thought, the activities you enjoyed, and what-not from when you were ten years old to when you were twenty, then thirty and so on, right?
To further underscore the foregoing, other scientists claim that 100% of our body cells die and are replaced every seven years . . . so it would seem, that none of us are the same person from one decade to the next no matter how you slice it, eh wot?
Well now, of one thing I am certain: When I turn on the tee-vee or access the DRUDGE REPORT (on the Internet) or overhear people of varying ages chat at a restaurant or elsewhere I think to myself that (considering the alternative) I am at once, very happy to be in my seventh decade on this planet (and at 66, like it or not I am in my ‘’seventh decade!'’) - and conversely, I am somewhat saddened by the fact, as well.
Why? Well, from a philosophical aspect I tend to believe that our society is going to hell in the proverbial handbasket. I won’t be around long enough to suffer the true results of what I see happening in our world, BUT I do worry about those younger folks I care about - and can only hope that I am dead wrong in my inherent dread.
Frankly, I doubt it, as our society no longer really has a set of morals by which they live - although, certainly, some still pay lip service to some peculiar standard that is a watered-down version of what I was taught. But all that is, as they say, another story.
What concerns me at the moment is that as I look around me I see people just acting in nutty ways when it comes to one of the most important mainstays of American life - their financial resources. Credit card debt is at an all-time high with some three TRILLION dollars in outstanding, unpaid (probably never to BE paid) balances on a jillion pieces of plastic reposing in each and every American’s wallet or purse.
I watch bewildered as young couples with several children go deeper and deeper in debt to buy an ever larger house with what I call ‘’duplicate rooms'’ that cost a fortune to build, finance and maintain - yet, they will never be used in the period during which the couple occupies the abode.
I mean, really, how many people do you know who open their front door to greet your arrival and then usher you into their fancy/schmancy living room, filled with expensive furniture, rugs and other pretty accouterments? Nope. They’ll consider you friends enough to welcome into their personal ‘’lair'’ - the family or recreation room, right? And that is fine - that is good!
So why bother to factor in that unnecessary and wasted extra room nobody wants, needs or will use? In anticipation of that ‘’very special guest'’ (who IS that?) who will never arrive at their doorstep?
And why build an exercise room, or a sauna, or an extra garage, or a gazebo or . . . (whatever) if you know darn well you will never deign to even consider using the thing . . . are you trying to impress someone? Who? This is (in my mind) just plain waste!
Sure, I LOVE ‘’good stuff.'’ I love to eat, travel, live well, have nice things and all that . . . BUT I prefer to spend my hard-earned on things that will actually and truly provide a definite return - not some ghostly ‘’maybe someday'’ item that again, is purely a waste of my money.
Better to take those $$ and go blow ‘em at a casino somewhere - at least THERE, you’ll have some fun - may even realize some big ‘’wins'’ and certainly, some enduring memories for you and yours to share as the months and years pass.
What set me off (above) is a feature piece on television I saw recently where a hardworking young man and his wife - with two toddlers - were bemoaning the fact that they worked every day very hard but had nothing to show for it.
They claimed they had no money to ‘’go out,'’ to dine at a restaurant other than ‘’Mickey-Dees,'’ to go dancing or whatever ’twas that tickled their fancy.
Speaking of tickle, they even went so far as to claim that their ‘’poor status'’ dimmed their sex life and . . . well, you get the picture.
They were a couple of schlubs who blamed our society, our way of life and everybody else (except themselves) for their perceived sorrowful plight. BULL-TICKEY (and pu-leeze - DO take license there and translate into the REAL words that you just know I would like to say if this where not a family publication!)
Those folks and far too many others - are just plain ‘’full of it!'’ They both work, they are both seemingly well-educated yet, get this:
The wife was grossly overweight - turns out she’s also pregnant for the THIRD time in four years. Is that really intelligent?
The husband - also grossly overweight - is just plain fat and stupid in my opinion. It costs money to become obese - and according to him (and her) they cannot afford to waste money.
The wife has these ugly, long, totally useless glued-on fingernails that cost a good many bux every week to install and maintain. Her hair is professionally coifed - at least an $80.00 ‘’do'’ by any standard (I once owned a successful beauty salon - I know these things!)
The two snotty-nosed kids (neither of which should BE, if the couple is truly as hard-up as they claim) are off to one side of the picture playing some sort of tv games and eating pizza - apparently delivered from a national chain because there’s a delivery box nearby. Such a pizza cost at least $15.00 to $20.00 (plus a $5.00 tip if one has ANY class at all) - yet on sale at most any supermarket a similar (and very tasty!) version can be had at four for ten bux!
’tis not a matter of ‘’economy of scale,'’ but rather, ‘’economy of common sense!'’ What the heck has happened to the prideful American concept of taking responsibility for your own actions? Why blame your parents, the neighbors, your President or Congress for YOUR shortcomings?
If you do not have enough money to support yourself and your family it is YOUR fault - no one else’s. You can try all you like to find another scapegoat, but after all is said and done - at the proverbial ‘’end of the day'’ - look in the mirror because only THERE will you find the true culprit behind your failings . . . it’s YOU, darn it . . . YOU!
Need more money? Get out there and earn it! Whilst you’re at it, gather your family together and have a brainstorming session and list the areas where ALL of you are wasting money . . . figure out ways you can save money . . . make MORE money and perhaps, in general, just conserve your mutual resources.
Then, stick some of that extra money you find(!) in the bank! Nothing fancy necessary - don’t waste your time looking for some magically huge returns on your investment - just stick those extra funds in a bank somewhere where they will be safe - and leave ‘em there! It has been said that nothing succeeds like success - but better still, nothing compounds so sweetly as . . . MONEY!
Anyway, sorry for the ‘’rant'’ but really, if you just sit around listening and/or watching some other members of our society, you are apt to come to the same conclusion: ‘’Man, these people are dumb - or lazy - or misguided, or . . . ‘’
And THAT my friend, in MY case at least, comes from being in that seventh decade I mentioned earlier and looking back at a whole lot of nonsense that not only others engaged in but, naturally, so did I at one point . . .
% % % %
A-GOOGLE-ING WE WILL GO . . .
I enjoyed a really good GOOGLE session the other night (remarkable, for someone my age, eh wot?!) Anyway, for pure research source data, there’s nothing much better, and . . . It’s 100% FREE at: www.google.com In this case, I was trying to remember what day of the week my youngest, P.C. (Dominique), was born.
She had recently celebrated her 36th birthday, and whilst I well recalled the 22-hour wait for her to get here (probably, her mother remembers it even more vividly), I had forgotten what day of the week ’twas. I also wanted to confirm that I had been born on a Tuesday, as I had been told.
Turns out I arrived on this planet on the early morn of a Wednesday, whilst P.C. was actually the one born on a Tuesday. I found this out (plus some other interesting data) on this site: www.infoplease.com/year/ You may want to pay them a visit there, too. ‘’Pay'’ you will not though, as full access to that site is also free.
% % % %
HOW ‘GRACEious’ IS YOUR CREDIT CARD?
Make certain that your card allows for at least a 25 day grace period between your last purchase and billing for the same. That’s 25 days of (effectively) a no-interest loan. Some banks now eliminate such grace periods. If yours does, dump ‘em!
Further, if you need to get a cash advance (that’s a LOAN, remember!) check around: Chances are, your chargecard is the WORST place to get it. Rates are high and they generally start the MINUTE you get your cash advance: There is NO grace period on such transactions, even if there is a standard 25 day grace period on regular merchandise charges.
CAN YOU REALLY AFFORD A CREDIT CARD?
Many people who get into trouble as a result of over-extending their credit cards, do so because they have no idea how to avoid problems. A simple rule of thumb is this: Whatever your NET monthly income, never allow your credit card payments to exceed 20%.
If you take home $2,000.00 a month, you’d not want to be obligated for more than $400.00 a month in credit payments. Frankly, we at DAX feel that is way too much. Our philosophy has always been to structure your credit life so as to pay off the full amount you owe on your card(s) each and every month. You avoid interest charges and sleepless nights, too!
HOW DO YOU STACK UP?
For some reason, we Americans are always curious about how we compare to everyone else -why I’m not sure - but ’tis true! Thus, if you’d like to know how your unpaid charge card balance compares to the national average, here are the stats:
Today, the average unpaid balance per card is $1,700.00. That’s up from $1,300.00 just ten years ago. If YOU have a monthly balance of any amount - better concentrate on getting it paid off -BEFORE you charge any more dollars or I can assure you, you will be ‘’fiscally sorry!'’
% % % %
IT’S ABOUT TIME!
I guess you know, I’ve been a crusader of one sort or another all my life. I did not choose that mission - just came by it naturally, I suppose. Well one thing (of many thousands) that has always bothered