Cutting Costs

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With gas prices on the rise, and likely to continue to rise, I’m sure you’ve thought about it. What, with all the press “going green” and hybrid models have received lately, it’s hard not to let it cross your mind.

That’s right — plonking down some coin to get a hybrid vehicle to save money in the future.

Recently, the Orlando Sentinel featured a calculator to see if there really are savings to be had:

For me, the answer is a definite NO.

My daily driver is a subcompact hatchback that gets 39 miles per gallon.

Even my BMW gets over 30 miles per gallon!?

Though I really like the look of the Prius, it wouldn’t “pay for itself” for over a decade.

That’s not a money saver by any means. And besides, gas *still* isn’t that expensive.

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GAP Worker JeansI buy my pants on eBay.

Contrary to what you might think, they don’t even come in a can. Yep, it’s true.

For years, the jeans I wore weren’t exactly designer, but they weren’t from J.C. Penney either. I’d say I was generally spending around $60-$70 on a pair of jeans.

For the past 5 years or so, I’ve bought my jeans at the GAP. They had one style I really liked — the Worker Jean.

Baggy, but not loose meaning the crotch didn’t hang at the knees.

Not a flair cut, but not an 80’s style taper either. You could still plainly see that I indeed did have feet.

No silly carpenter pockets all over one leg. No hammer loops. No rivets in places that should never have rivets. And no silly back pocket embroidery.

Basically, they were stylish enough and didn’t make me look like I was trying to be a teenager.

On a side note, isn’t it comical when you see a guy in his 40’s or 50’s with camo-cargo shorts down to his ankles and a graphic tee from Hollister on? They’re not fooling anyone… Hey, even I’d look ridiculous in an outfit like that…

I owned 7-8 pairs of those GAP jeans at any given time, or over $400 worth.

But then the supply started to dwindle. A hole here, a hole there. It was time splurge a little and renew the wardrobe.

I went online and saw that the GAP no longer offered this “cut”. Oh no.

Disappointed, I bought the closest thing they had — low rise boot cut — and… well, let’s just say that I haven’t worn that pair very often. They’re not the same.

Enter eBay.

Now, my wife used to do the thrift store thing pretty frequently before I met her and I did my best to curb her of that. Thrift stores just aren’t my thing. I mean, I’m not really fond of wearing other people’s discarded clothes. I realize eBay is the same thing, but eBay lacks the musty smell of a Salvation Army or Goodwill store. You can’t deny that.

For me, that makes all the difference.

Recently, I hit the gold mine when it comes to jeans. An eBay seller was offering SIX PAIRS in my size, in my cut, and all in one listing.

Generally when my size comes up on eBay, the pants get a few bids and sell for around $15-$20. Add another $5, or so, for shipping. Still a pretty good deal considering when new, they run around $70. (And from the looks of the pictures, the jeans are as ‘new’ as my low rise boot cuts.)

Since this auction was in a lot of 6 (dumb move on the seller’s part), there wasn’t much competition. There was only one other bidder, and a newbie at that.

Needless to say, I won six pairs of jeans for $32. It’s like an 85%-off sale. That’s less than $6 per pair!

Best of all, they accepted PayPal, so I didn’t even have to use the credit card (which I most certainly would have had I been at the mall.)

That’s a deal you can’t argue with.

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Bill SlowskyI was really late jumping on this bit of technology.

Back in December, I decided to consider abandoning the check book for most of my monthly bills.

I signed up to pay online with the various utility companies and my cell phone provider. Those are pretty much the only variable monthly bills I have.

I went to all of their various websites and filled in my information, set up a gazillion logins, passwords, and security questions — most of which I’ve forgotton because they require upper and lower case with a few symbols thrown in for good measure — and then paid my first bill (but still requested to be mailed paper statements).

That turned out to be a big old waste of time as my checking account with Bank of America offers free BillPay and they have a nice drop down list of the companies that you can “pay” using their service. As luck would have it, all of my utility companies were listed.

I should have checked there first. Duh?

Now I’ve always been one to pay my bills the day they arrive in the mail. While that may not be a smartest move — sending payments in weeks before they’re due — I’ve never been close to missing a payment.

One less thing to have to sweat.

But with the online payments, it’s even nicer. You get to pick the date, and that’s the date the money comes out of your account. I’m still paying weeks in advance (though that may change once I get used to it), but it’s so much easier to balance the account when you’re not waiting for checks to clear.

Really, Comcast would hold on to a check for an average of 18 days, often making me wonder if my payment was “lost in the mail.” It’s like Bill Slowsky is actually working there and not just the on-air talent…

On Saturday, I set up my natural gas bill to be paid on March 18 (today) and guess what? Yep, my checking account shows that I’m $313 poorer today. Excellent.

Nothing fuzzy about that.

It’s not so much about saving money (I’m sorry, stamps are still a bargain), or time (does it really take that long to write a check?), or even the environment (since I’m still receiving paper statements, going “green” evidently doesn’t interest me all that much either)…

It just allows you to be more organized and on top of things when it comes to your finances.

Or maybe it just has that effect on me.

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Converse All-Star Chuck TaylorI got my first pair of Chuck Taylors in 1985.

At the time they were just coming back into style, and if I didn’t walk in on the first day of school with a sweet new pair of high-tops, well, I’d be destined to be an outcast for the rest of the school year.

My mom probably paid nearly 40 dollars for those in preparation for my big day entering the 4th grade.

I remember thinking I was *so* cool because mine were yellow. A rare colour at the time — those aqua blue ones were the “hot” color back then.

They were also the first pair of canvas shoes I’d ever worn, having followed a long line of leather Nike, Reebok, Pony, Puma, and Kangaroos. Remember Roos? (Seriously, you can never have enough zippered pockets on your shoes.)

But you know what? The All-Stars held up better than any of those leather shoes. I wore those yellow hi-tops right up until 5th grade, when I replaced them with a pair of off-white ones.

Anyway, they quickly fell out of style, as they generally do every 10 years or so, and their prices plummeted. I kept on wearing them and as the years went by, I generally opted for the low-top (or “oxford”) instead of the high top.

In high school, I worked in the shoe department of a clothing store. At the time, the low-top version of the Chuck Taylor was $14.99/pair. Needless to say, I had nearly every colour our store offered.

I even started wearing mismatched colours. Kinda stupid in hindsight, but I was always careful to rotate them evenly just in case, say, I ever wanted to wear two purple ones. They’d both look equally beaten up.

By the time I was in university the price on low-tops had jumped to $24.99. Still very reasonable considering I could get a good solid year out of one pair. At the time I also dabbled a bit with other brands, usually canvas versions of Vans. They just weren’t the same and I always found myself going back to Converse.

After 20 years, it’s not just a shoe, it’s a life style. (Okay, that was over the top.)

Lately though, Chuck Taylors have come back in style.

While that’s good for me — I look mildly trendy again for the first time in over 20 years — it’s really bad for my wallet. Chucks aren’t $14.99/pair anymore. Even $24.99 would be a bargain.

Nope, they top out at over $40 nearly everywhere.

That’s too much for a flap of rubber, some canvas, and a few grommets. Too much for me anyway.

I’ve been on the cheap when it comes to shoes for decades now. So now what?

Enter the knock-off…

Both Walmart and Target carry a low top version of the All-Star. Unfortunately their colour selection is seriously lacking, but the black low top is a classic and with a price tag of $12.99, well, it’s a done deal for me.

I’ve been rotating two pairs of black knock-offs for the past two years. The Target version is identical to the real thing, right down to the brown sole. The Walmart version is a tiny bit different, but unless you’re looking at the bottom, you really can’t tell. They wear just like the latest overpriced Converse.

(Converse used to last longer before Nike took over and changed the “formula” for this classic shoe.)

I’ll go out on a limb and say that the Target knock-offs are manufactured under the same roof as the real thing. They’re that similar, right down to the laces. My new casual everyday shoe of choice.

So, with that, and all the years of savings, I think I’m due for an overpriced pair of sneakers to conquer my most recent goal.

Here’s to hoping I keep it under $100!

Mmm...money...It’s like the line, “it’s not what you make, it’s what you save” quote that’s thrown around so often has finally sunk in.

I used to think that to be “rich” required having a high paying job. But now, I’m realizing that that isn’t necessarily true.

Back in November I stopped working for my highest paying client. The choice was 100% mine and I knew that the lack sudden lack of income could be a problem.

But you know what?

Now nearly 4 months later, it hasn’t been a problem. And it’s not going to be a problem either.

I was always under the impression that my day-to-day finances were what kept things pointed in the right direction but, boy, was I mistaken…

My day-to-day finances are such a tiny percentage of my net worth, and that’s something I never really realized. Investments (and property) are what make up nearly all of the monthly gains (or losses) now..

Most months, the gains in these two categories far exceed my take home pay. By far.

I spend less than I make. That’s the key. And that’s something that I didn’t do in the past (obviously) as I dug myself into $30k worth of credit card debt.

I used to lunch at McDonalds or Burger King every single day during the week. Combined with the change lost in the seats of the car, that was costing me in excess of $40 per week. Now, I don’t eat lunch at all (yes, a problem of it’s own.)

I cancelled my cell phone service with Verizon saving me at least $30/month.

As I’ve watched my monthly finance charges drop from over $400 to under $20 on my credit card debt, I’ve seen the snowball at work — even though I didn’t actually use the snowball method for much of the way. That’s saved me, well, $380/month.

My standard of living hasn’t dropped one bit.

It hasn’t really improved either, now that I think about it, but in the future it will most certainly improve — because I’ll have the money in the bank to do it.

I’d say I was just breaking even when I still had all of those expenses. Now, with just those limited examples, I’ve shaved nearly $600 off of my expenses. That’s HUGE and I hardly even notice it.

Now that the credit card debt is almost eliminated, I’m on the verge of finding myself with that extra $600/month in my pocket! The possibilities?!

It just drives home the point that how much I make isn’t all that important anymore, it’s more about what I do with the amount that I make. Now that I’m doing that wisely, the rest kind of takes care of itself. Kinda like autopilot.

Building wealth is actually a lot easier than I ever expected.

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2007 Utility CostsYep, another “end of the the year” post.

In the last few months of 2007, we actively started trying to cut down on our utility expeneses, but for

comparison’s sake for 2008, last year’s totals are to the right.

With the cost of everything seemingly going up each year, it will be interesting to see if we are able to cut these costs any…

It’s a bit of an eye opener to see that the cable bill adds up to so much — eclipsing the phone (which is more important) and the internet (which we use a lot more than the tv). I’m not about to drop cable though — the History Channel comes in mighty handy when the networks are all showing infomercials. And my wife is addicted to the Food Network…

Is it worth almost $700? Well, I’m not so sure now…

One value I know will drop in 2008 is the cell phone expenses. I dropped Verizon Wireless in favor of a pre-paid plan with Virgin Mobile in the Fall and that could lower my yearly costs to under $100.

As we near the end of the year, it makes it easier and easier to compare this year with last — and leaves time to make any end of the year attempts at besting last year’s numbers.

I use Microsoft Money to track my finances. Back in 1997, for unknown reasons (it probably had a nicer box than Quicken), I bought the program and started maintaining my checking account transactions.

After a few years of seeing how cool it was, once I had enough data, I expanded to keeping track of my credit cards. At first it was just the monthly balances, but eventually I started tracking every transaction and categorizing things accurately.

It took a few years to get things categorized to my liking, and by 2005, I had a pretty good system down. I’d added my 401k to the mix, my auto loans, basically everything financial.

The numbers this year look, well, okay I guess. I made more, which is always a good thing, but I also spent more.

While the original goal of 2007 was to increase my net worth to 6 figures, I think the main target in reaching that goal (which I won’t reach this year) was to curb my credit card use. And I think I’ve done that.

In 2006, I ran up $24,572 in credit card charges — $8k more than ever before. That’s a huge number. That’s an embarrassing number.

So far, in 2007, I’ve spent $22,305 on the credit cards. When you average it out over the past 11 months, that works out to around $2k per month, so adding in December, it will appear as though I’ve spent just shy of $25k this year too.

So why am I happy about that?

Well, though there’s a essentially no difference in the amount charged each year, there is a HUGE difference on where the money went.

In 2006, I spent all $24.5k on, well, stuff. The big expenses that year were a camera, a computer, a ring, a big car repair, and who could forget the hockey jerseys… Just stuff really. But that’s a lot of stuff.

Between July and August of this year, I charged $16k towards our home improvement projects. That’s something that isn’t going to happen again with any frequency. Take that out of the equation and I’ve really only spent $6305 so far in 2007.

I’ve cut my “stuff” expenses by 75%. And you know what? I still have plenty of stuff.

My habits have changed for the better and, at the same time, I can’t say my “quality of life” has declined any. At this rate, I’ll be credit card debt free this summer.

But it’s not all good news. While I spent less “technically” on the credit cards this year, I also paid less back.

In 2006, I sent $29,966 in payments towards three credit cards. This year, I only paid back $25,719. This is due in part to the aggressive repayment of the $12k bank loan we took out at the end of 2006 — and wasn’t a part of my “credit card” plan, but even still, that’s the only place I regressed.

Here’s the chart:

Credit Card Totals
That’s the great thing about tracking your finances in MS Money, or even Quicken if you choose that route. You can visualize your progress, and that’s a huge motivator.Look at the drop in Finance Charges!? That’s not something I would have noticed if not for this program keeping track of everything and all of its built in reports.

It just goes to show that, even when you charge like a madman, choosing the right card to use makes a big difference. And choosing when (and what) to refinance with a lower rate promo offer can save you tons. Look at that — that’s over a $2000 difference between 2005 and 2007. And the total balance hasn’t really moved more than $5k.

And to end on an even higher note, it’s truly reassuring to see that, even just taking into account the the credit cards on their own, I spend less than I pay back.

Even with these obscene totals, I can’t imagine how deep I’d be if that hadn’t been the case all along.

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Can I get some fries with that?Over the years, my wife and I have often received gift cards to area restaurants. Most of them are for borderline fancy places too.

Just this week we received another $100 card.

Problem is, I’m a bit of a picky eater. Okay, that’s a stretch.

Put it this way, if french fries aren’t an option on the menu and refills aren’t free, chances are, I’m not going to like it.

I like to think that it’s my frugal taste shining through. Others may think it’s just that I have no taste.

The issue at hand now is that we’ve collected well in excess of $500 worth of these cards. All essentially useless to us. That’s frustrating.

Of course, we could re-gift them, but deep down, I have a fear that a $100 gift card from two years ago may have expired, wrong as that may be on the part of the restaurant.

My wife researched the various websites that allow you to trade gift cards this week, but it seems a little troublesome. It would be very difficult to find a trade partner (since many of the restaurants are regional at best), and in auctioning one off, well, we probably wouldn’t get even half the value and again, I’d be worried that I may have just sold an expired card to someone.

So what are our options? I’m thinking a few nights out at expensive restaurants where we can order to our hearts’ content to celebrate our newly open schedule.

It’s just a shame that I probably won’t enjoy any of the food.

And the refills probably won’t be free either.

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