Posted By Paul
Those of you who follow Frugalize know that Matt and I strongly encourage people to have a rainy day fund ready for life's little emergencies.
I've been building an emergency fund for years and recently found myself in a spot where I actually used it.
Here was the series of events that made me very glad that I had my rainy day fund (many of which are mentioned in prior posts):
1) The roof - even though I saved money on doing the roof vs. paying someone there were expenses related to that which depleted my checking account. (Equipment, supplies, etc.)
2) Leaky pipes - it was a quiet afternoon when I saw the wet patch on my ceiling. Two minutes with a dry wall saw and one bucket of really gross water later and I discovered the leaky pipe. It wasn't the end of the world but it did cost some money to have the plumber come out and fix it. I believe in do it yourself when possible, but when it comes to leaky pipes I don't take chances.
3) Bad washer and dryer - The washer and dryer gave out on us. After many do it yourself repairs and years of faithful service our washer and dryer amazingly both gave out at about the same time. The repairman came and declared them "so broken that it would be cheaper to replace them" which is what we did.
4) Bad dishwasher - Not more than two weeks after the washer and dryer gave out our dishwasher also gave up the ghost. A similar story here. We called a repairman, he came, said that there were major issues with our dishwasher and it would be cheaper to replace it.
None of the above events had a huge financial impact, but putting them all together made for quite a bill.
It made me VERY happy that I had my emergency fund to dip into. Had it not been for the emergency fund we would have had to have either come up with the money some other way (borrow against retirement accounts - bad, putting it on credit cards - bad) or just plain do without those appliances for a while (which would have been doable but a hassle).
So now that hopefully the expenses have settled down for a while (knock on wood) our plan is to replenish our rainy day fund so that it is back up to full power. It was a good lesson for me to discover that the rainy day fund isn't just for an unexpected big event, it is just as likely to come in handy when you are faced with a quick series of small events.
Monday, November 22, 2010
Friday, November 19, 2010
Article: Black Friday's dirty little secrets.
Posted by Paul
I've never been a Black Friday participant (they pretty lose me at 'wake up early on a day off'), but I've always been intrigued by the tradition.
I found an article about things to watch out for on Black Friday. An interesting read, but one point in particular surprised me.
It was referring to the idea of "derivative models" essentially sale models that lack features from the standard model. They use an example of a Samsung TV being advertised as a Black Friday special at Wal-Mart. Here is an excerpt from the article:
---
"That model doesn't appear on Samsung's web site. Maybe it was made just for Black Friday," he said. Another red flag, the deal on that TV just lists the deal price and not the regular price of the model.
---
I had no idea that there might be special models made just for Black Friday or other sales. It seems like the consumer really needs to research sale models carefully, especially with electronics where model numbers and feature sets are often complicated.
The whole article can be read at the link below:
Black Friday's dirty little secrets
I've never been a Black Friday participant (they pretty lose me at 'wake up early on a day off'), but I've always been intrigued by the tradition.
I found an article about things to watch out for on Black Friday. An interesting read, but one point in particular surprised me.
It was referring to the idea of "derivative models" essentially sale models that lack features from the standard model. They use an example of a Samsung TV being advertised as a Black Friday special at Wal-Mart. Here is an excerpt from the article:
---
"That model doesn't appear on Samsung's web site. Maybe it was made just for Black Friday," he said. Another red flag, the deal on that TV just lists the deal price and not the regular price of the model.
---
I had no idea that there might be special models made just for Black Friday or other sales. It seems like the consumer really needs to research sale models carefully, especially with electronics where model numbers and feature sets are often complicated.
The whole article can be read at the link below:
Black Friday's dirty little secrets
Wednesday, November 17, 2010
Article: Spending Tips From Frugal Billionaires
Posted By Paul:
Here is an article I enjoyed about "frugal billionaires". It was kinda cool to read about people worth a billion dollars driving a Corolla.
Check it out:
Spending Tips From Frugal Billionaires
Here is an article I enjoyed about "frugal billionaires". It was kinda cool to read about people worth a billion dollars driving a Corolla.
Check it out:
Spending Tips From Frugal Billionaires
Saturday, September 18, 2010
Another Appliance Repair Story
Posted By Paul
A couple of weeks ago while I was working on the roof (see my earlier post: My Biggest Do It Yourself Project) our washing machine stopped working. We called a repairman who essentially said that the cost to repair it would be more than the cost to get a new one.
I was busy working on the roof so I didn't have time to deal with the washing machine so we weren't sure what to do.
Luckily the in-laws had a spare washing machine. Not only was it in great shape but they were able to bring it over the next day and we were able to wash clothes again.
Then just last week the "new" washing machine started to have problems. Specifically it suddenly stopped draining the water. My first thought was: "Sigh... we should have just bought a new one." So my wife and I were planning on going shopping that weekend, but then I decided that I would at least pop open the washing machine and make sure it wasn't something simple like a coin in the drain pipe or something.
When I opened up the washing machine I discovered this:
That is a sock that was stuck in the input to the drain pump.
It was REALLY wound up in there, even with vice grips and pulling I couldn't get the sock out. Ultimately I had to put a screwdriver in the other side and little by little force the propeller to unwind the sock.
Once I got the sock out I COULD have just put the pump back in but I decided to replace it (the pump, not the sock) since I had gone to the trouble of removing it plus the fact that the spot where the shaft drives it looked a little stripped (no doubt from when it was running with the sock in there).
I found the part on AppliancePartsPros.com
but I decided to see if I could find it at my local appliance repair store so that I didn't have to wait to get it shipped out.
I got the part at my local small appliance repair store (I highly recommend that everyone find their local small appliance repair place, it's often a great source of parts and even advice). It cost me a little more to get it from the local store, but I was able to walk out with it and install it that night.
The installation of the new pump went well. However there were two snags (both due to my own incompetence):
1) After putting the pump in I was closing up the machine when I heard a "clink" and saw one of the springs in the back had come loose due to my moving around of the tub assembly. Try as I might to re-attach it, I discovered that the only way to reach it was to essentially remove the tub assembly from the casing. It wasn't hard to do, but it was annoying to think (as I was dis-assembling my washing machine) that were it not for that spring coming loose I would have been done long ago.
2) After reattaching the spring and closing up the machine I started a cycle with the tub empty. After some water came in I advanced the dial to the point where the pump should engage. As I had hoped water came out of the drain tube. So the next day I told my wife it was ready for duty. I didn't realize that while disassembling the machine for item 1 I had accidentally disconnected the sensor that tells the machine when to shut the water OFF. So our first load resulted in a wet mess on the floor. Luckily when I opened up the washer cabinet again I saw a tube that went from a sensor on the washtub to...nowhere and realized my mistake and reconnected it.
So overall I'm really happy that we didn't just buy a new machine or call a repairman. Usually a repairman call is at least $100 plus parts and I spent half that on my replacement part. Granted I spent several hours fiddling with the machine but now I feel that I know how a washing machine works and the actual troubleshooting and fixing of the problem was kind of fun.
The only remaining mystery is how the sock got in there in the first place, but some googling suggests that it isn't unheard of for a sock to slip between the metal inner tub and outer tub and work its way down to the drain pump. Interestingly enough the sock didn't look like one of ours so we think it belonged the previous owners. At least the next time the drain stops working I'll know exactly where to look.
A couple of weeks ago while I was working on the roof (see my earlier post: My Biggest Do It Yourself Project) our washing machine stopped working. We called a repairman who essentially said that the cost to repair it would be more than the cost to get a new one.
I was busy working on the roof so I didn't have time to deal with the washing machine so we weren't sure what to do.
Luckily the in-laws had a spare washing machine. Not only was it in great shape but they were able to bring it over the next day and we were able to wash clothes again.
Then just last week the "new" washing machine started to have problems. Specifically it suddenly stopped draining the water. My first thought was: "Sigh... we should have just bought a new one." So my wife and I were planning on going shopping that weekend, but then I decided that I would at least pop open the washing machine and make sure it wasn't something simple like a coin in the drain pipe or something.
When I opened up the washing machine I discovered this:
That is a sock that was stuck in the input to the drain pump.
It was REALLY wound up in there, even with vice grips and pulling I couldn't get the sock out. Ultimately I had to put a screwdriver in the other side and little by little force the propeller to unwind the sock.
Once I got the sock out I COULD have just put the pump back in but I decided to replace it (the pump, not the sock) since I had gone to the trouble of removing it plus the fact that the spot where the shaft drives it looked a little stripped (no doubt from when it was running with the sock in there).
I found the part on AppliancePartsPros.com
but I decided to see if I could find it at my local appliance repair store so that I didn't have to wait to get it shipped out.
I got the part at my local small appliance repair store (I highly recommend that everyone find their local small appliance repair place, it's often a great source of parts and even advice). It cost me a little more to get it from the local store, but I was able to walk out with it and install it that night.
The installation of the new pump went well. However there were two snags (both due to my own incompetence):
1) After putting the pump in I was closing up the machine when I heard a "clink" and saw one of the springs in the back had come loose due to my moving around of the tub assembly. Try as I might to re-attach it, I discovered that the only way to reach it was to essentially remove the tub assembly from the casing. It wasn't hard to do, but it was annoying to think (as I was dis-assembling my washing machine) that were it not for that spring coming loose I would have been done long ago.
2) After reattaching the spring and closing up the machine I started a cycle with the tub empty. After some water came in I advanced the dial to the point where the pump should engage. As I had hoped water came out of the drain tube. So the next day I told my wife it was ready for duty. I didn't realize that while disassembling the machine for item 1 I had accidentally disconnected the sensor that tells the machine when to shut the water OFF. So our first load resulted in a wet mess on the floor. Luckily when I opened up the washer cabinet again I saw a tube that went from a sensor on the washtub to...nowhere and realized my mistake and reconnected it.
So overall I'm really happy that we didn't just buy a new machine or call a repairman. Usually a repairman call is at least $100 plus parts and I spent half that on my replacement part. Granted I spent several hours fiddling with the machine but now I feel that I know how a washing machine works and the actual troubleshooting and fixing of the problem was kind of fun.
The only remaining mystery is how the sock got in there in the first place, but some googling suggests that it isn't unheard of for a sock to slip between the metal inner tub and outer tub and work its way down to the drain pump. Interestingly enough the sock didn't look like one of ours so we think it belonged the previous owners. At least the next time the drain stops working I'll know exactly where to look.
Friday, September 10, 2010
My Biggest Do It Yourself Project
Posted By Paul
Frequent readers of this blog know that I aspire to being handy around the house with various levels of success.
Last week I took on what was without a doubt the largest project that I've ever attempted. The project was to put a new roof on my house.
Luckily I wasn't alone as my father-in-law is super handy and has done several roofs on both his house and others, so I was mostly serving as his assistant.
Here are some things that I learned from the experience:
1) If possible get the new shingles and supplies delivered to the roof. The packets of shingles don't look like much, but they are HEAVY. On the advice of my FIL, we had most of the shingles delivered directly to the roof and I am SOOOO glad we did. At one point I brought a couple packets of shingles down from the roof for cutting and later had to bring one back up again. Just wrestling that single packet of shingles up the ladder and onto the roof was a huge hassle, I couldn't image doing it over and over again.
2) Roofing spades are cool, but not essential. We had a roofing spade to clean off the old shingles. It worked fine, but so did a simple flat bladed spade that we also had. If you can borrow or already have a roofing spade that's great, but I wouldn't bother buying one. I included a picture of a roofing spade below that looks a lot like what we used.
3) Small crowbars and hammers are really useful. During the work you are almost constantly finding nails in the roof that you either need to remove or pound flat so it's nice to always have a hammer or crowbar within easy reach.
I had a mini-crowbar like the one below which was nice since we could use it easily with one hand.
4) A nail gun REALLY helps. Luckily my FIL had access to a nail gun and compressor. It is a big time saver, especially if you're not the best hammer swinger in the world (my FIL is great with a hammer, but I mess up 1 in about every 5 nails).
5) Plan for safety! One thing I would have done differently if I had it all to do over again would be to get up on the roof early and make plans for any support scaffolding or safety gear we needed. My house isn't huge but certain parts of the roof are somewhat steep and high enough that a safety line was really good to have. Luckily we were able to borrow a safety harness from Matt (who uses it for rock climbing) and lukcily I had some extra lumber around that we were able to turn into scaffolding. If you are roofing a single story house where the roof isn't too steep safety gear and scaffolding might not be a priority, but I suggest making those decisions early so that you can get any supplies or equipment before you start.
6) Roofing blades - these are just these little blades that have a hook edge. My FIL suggested we get some and I am very glad that I did. They cut shingles so much better than a normal box cutting blade. The hook end lets you cut the shingle without worrying too much about cutting through whatever is underneath, which is handy when you are trying to cut shingles on the roof. Get plenty since they do get dull after cutting through shingles for a while (we went through 6 blades in just a few days). I included a link below to get an idea of what I am talking about:
The roofing project took over a week. It was just my FIL and I, and luckily the weather cooperated but it was still a solid week of being on the roof from morning until dark (with breaks for lunch and dinner). The work was pretty hard and on the hot days it got pretty miserable.
The good news is that when the roof is done you get a real sense of satisfaction and you save a lot of money by doing it yourself.
Overall, if you enjoy doing projects yourself and you have access to the proper tools and someone who knows what they are doing then roofing can be a really rewarding way to save some money.
Frequent readers of this blog know that I aspire to being handy around the house with various levels of success.
Last week I took on what was without a doubt the largest project that I've ever attempted. The project was to put a new roof on my house.
Luckily I wasn't alone as my father-in-law is super handy and has done several roofs on both his house and others, so I was mostly serving as his assistant.
Here are some things that I learned from the experience:
1) If possible get the new shingles and supplies delivered to the roof. The packets of shingles don't look like much, but they are HEAVY. On the advice of my FIL, we had most of the shingles delivered directly to the roof and I am SOOOO glad we did. At one point I brought a couple packets of shingles down from the roof for cutting and later had to bring one back up again. Just wrestling that single packet of shingles up the ladder and onto the roof was a huge hassle, I couldn't image doing it over and over again.
2) Roofing spades are cool, but not essential. We had a roofing spade to clean off the old shingles. It worked fine, but so did a simple flat bladed spade that we also had. If you can borrow or already have a roofing spade that's great, but I wouldn't bother buying one. I included a picture of a roofing spade below that looks a lot like what we used.
3) Small crowbars and hammers are really useful. During the work you are almost constantly finding nails in the roof that you either need to remove or pound flat so it's nice to always have a hammer or crowbar within easy reach.
I had a mini-crowbar like the one below which was nice since we could use it easily with one hand.
4) A nail gun REALLY helps. Luckily my FIL had access to a nail gun and compressor. It is a big time saver, especially if you're not the best hammer swinger in the world (my FIL is great with a hammer, but I mess up 1 in about every 5 nails).
5) Plan for safety! One thing I would have done differently if I had it all to do over again would be to get up on the roof early and make plans for any support scaffolding or safety gear we needed. My house isn't huge but certain parts of the roof are somewhat steep and high enough that a safety line was really good to have. Luckily we were able to borrow a safety harness from Matt (who uses it for rock climbing) and lukcily I had some extra lumber around that we were able to turn into scaffolding. If you are roofing a single story house where the roof isn't too steep safety gear and scaffolding might not be a priority, but I suggest making those decisions early so that you can get any supplies or equipment before you start.
6) Roofing blades - these are just these little blades that have a hook edge. My FIL suggested we get some and I am very glad that I did. They cut shingles so much better than a normal box cutting blade. The hook end lets you cut the shingle without worrying too much about cutting through whatever is underneath, which is handy when you are trying to cut shingles on the roof. Get plenty since they do get dull after cutting through shingles for a while (we went through 6 blades in just a few days). I included a link below to get an idea of what I am talking about:
The roofing project took over a week. It was just my FIL and I, and luckily the weather cooperated but it was still a solid week of being on the roof from morning until dark (with breaks for lunch and dinner). The work was pretty hard and on the hot days it got pretty miserable.
The good news is that when the roof is done you get a real sense of satisfaction and you save a lot of money by doing it yourself.
Overall, if you enjoy doing projects yourself and you have access to the proper tools and someone who knows what they are doing then roofing can be a really rewarding way to save some money.
Sunday, July 25, 2010
Crash Budgeting
Posted By Paul
As someone who has spent nearly all of their adult life budgeting, saving towards goals, AND trying to live a fairly healthy lifestyle, I was intrigued by the thoughts that came to me after reading the following article:
Why Budgets Fail: Leave My Latte Alone
It's a list of reasons why people are unable to stick to budgets and ways to help. I noticed the entry in the article called the "Gung-Ho Backfire":
---------
The Gung-Ho Backfire - You set up a strict budget and then wonder why you can't stick to it. By trying to cut spending too drastically, you create an unsustainable budget that is sure to buckle under pressure.
---------
I realized that the unhealthy approach described here was like the "crash diet" for saving money, where you create a goal that is so hard to maintain that you are practically guaranteed to fail.
For example:
I had a friend who was carrying some credit card debt that they wanted to eliminate (a great goal for sure). I was talking with them about the budget they had set up and discovered that they had set a goal of putting aside a certain amount of money each month to pay off their credit cards (I think it was something like $500 a month). I told them that I thought this was a great goal and since their debt wasn't huge they figured that they would be able to pay it off in about 6 months at this rate.
What actually happened? Well the first month went well. They managed to hit their goal and pay down their debt by $500.
The next month an unexpected car repair came up and since they didn't have a "rainy day fund" set up that had to come out of the money they hoped to set aside for their credit card debt.
The month after that they decided to splurge a little since the last two months had been all about saving, saving, saving. So they went on a shopping spree that ended up eating the savings for that month.
Things got worse after that and before long the budget and goal were simply forgotten.
I realized just now that this whole experience felt a lot like someone who was going through a crash diet.
By creating this specific savings goal my friend had slashed their budget to the bone. They had left no money for incidentals or the occasional bit of fun. Sort of like the crazy diet where you decide you'll only eat celery in anticipation of the pounds melting off of you.
The car repair was kind of like the holiday season or the vacation where you find it impossible to stick to your diet. So you get discouraged and feel like a failure, and you feel like maybe the goal is impossible.
The month where they decided to treat themselves is like the cheeseburger and ice cream sundae splurge after the miserable time spent on your crazy diet.
What follows is the same phenomenon you see with crash diets where the person can't stick with the diet and ends up quitting early. They often lose the dramatic results they gained at the start of the program (my friend quickly re-accumulated the credit card debt and then some).
At the time I thought the problem was that my friend didn't have the discipline to follow through on their plan, but now I think that a big part of the problem was that they set their expectations too high (just like with a crash diet).
You might be able to live the "pinch every penny" lifestyle like that for a while, but when you just can't keep it up anymore you give up on the plan AND the goal. This is too bad since the goal was probably attainable if you had just been able to accept a more moderate change with less dramatic results.
By creating such a hefty savings goal my friend had put budget constraints on them that were so strict that they couldn't follow them for more than a couple of months. If they had set a savings goal of $250 a month they might have been able to stick with their program and payoff their debt. Sure it would have taken twice as long but they would have reached it. It's the same way with a more moderate weight loss program where you make more moderate changes. Your results won't be as dramatic but at least you'll create a system that you'll be able to live with and maintain.
Maybe the problem with "crash dieting" and "crash budgeting" is that the goal is to create a temporary process so that you can fix a problem and then forget about it. What you really need in both cases is a long term plan that you can maintain so that the results actually last.
As someone who has spent nearly all of their adult life budgeting, saving towards goals, AND trying to live a fairly healthy lifestyle, I was intrigued by the thoughts that came to me after reading the following article:
Why Budgets Fail: Leave My Latte Alone
It's a list of reasons why people are unable to stick to budgets and ways to help. I noticed the entry in the article called the "Gung-Ho Backfire":
---------
The Gung-Ho Backfire - You set up a strict budget and then wonder why you can't stick to it. By trying to cut spending too drastically, you create an unsustainable budget that is sure to buckle under pressure.
---------
I realized that the unhealthy approach described here was like the "crash diet" for saving money, where you create a goal that is so hard to maintain that you are practically guaranteed to fail.
For example:
I had a friend who was carrying some credit card debt that they wanted to eliminate (a great goal for sure). I was talking with them about the budget they had set up and discovered that they had set a goal of putting aside a certain amount of money each month to pay off their credit cards (I think it was something like $500 a month). I told them that I thought this was a great goal and since their debt wasn't huge they figured that they would be able to pay it off in about 6 months at this rate.
What actually happened? Well the first month went well. They managed to hit their goal and pay down their debt by $500.
The next month an unexpected car repair came up and since they didn't have a "rainy day fund" set up that had to come out of the money they hoped to set aside for their credit card debt.
The month after that they decided to splurge a little since the last two months had been all about saving, saving, saving. So they went on a shopping spree that ended up eating the savings for that month.
Things got worse after that and before long the budget and goal were simply forgotten.
I realized just now that this whole experience felt a lot like someone who was going through a crash diet.
By creating this specific savings goal my friend had slashed their budget to the bone. They had left no money for incidentals or the occasional bit of fun. Sort of like the crazy diet where you decide you'll only eat celery in anticipation of the pounds melting off of you.
The car repair was kind of like the holiday season or the vacation where you find it impossible to stick to your diet. So you get discouraged and feel like a failure, and you feel like maybe the goal is impossible.
The month where they decided to treat themselves is like the cheeseburger and ice cream sundae splurge after the miserable time spent on your crazy diet.
What follows is the same phenomenon you see with crash diets where the person can't stick with the diet and ends up quitting early. They often lose the dramatic results they gained at the start of the program (my friend quickly re-accumulated the credit card debt and then some).
At the time I thought the problem was that my friend didn't have the discipline to follow through on their plan, but now I think that a big part of the problem was that they set their expectations too high (just like with a crash diet).
You might be able to live the "pinch every penny" lifestyle like that for a while, but when you just can't keep it up anymore you give up on the plan AND the goal. This is too bad since the goal was probably attainable if you had just been able to accept a more moderate change with less dramatic results.
By creating such a hefty savings goal my friend had put budget constraints on them that were so strict that they couldn't follow them for more than a couple of months. If they had set a savings goal of $250 a month they might have been able to stick with their program and payoff their debt. Sure it would have taken twice as long but they would have reached it. It's the same way with a more moderate weight loss program where you make more moderate changes. Your results won't be as dramatic but at least you'll create a system that you'll be able to live with and maintain.
Maybe the problem with "crash dieting" and "crash budgeting" is that the goal is to create a temporary process so that you can fix a problem and then forget about it. What you really need in both cases is a long term plan that you can maintain so that the results actually last.
Wednesday, July 14, 2010
Article: 10 products to always buy generic
Posted By Paul
I thought this was a pretty cool article:
10 products to always buy generic
Now that we have a little one with various toys we seem to go through batteries more quickly and we now just get whatever battery is cheapest and we haven't noticed any difference.
We often buy generic or store brands and only switch back to the name brand if we have a reason.
For example I have a cheesecake recipe that I'm rather proud of and I've noticed that whenever I make it with generic cream cheese it doesn't turn out as well. So I always go for the name brand when I'm going to make that particular recipe.
An interesting little article, check it out!
I thought this was a pretty cool article:
10 products to always buy generic
Now that we have a little one with various toys we seem to go through batteries more quickly and we now just get whatever battery is cheapest and we haven't noticed any difference.
We often buy generic or store brands and only switch back to the name brand if we have a reason.
For example I have a cheesecake recipe that I'm rather proud of and I've noticed that whenever I make it with generic cream cheese it doesn't turn out as well. So I always go for the name brand when I'm going to make that particular recipe.
An interesting little article, check it out!
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