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Archive for September, 2008

Im on a tear – Just saved $300 on Directv (psst, here’s how)

Wednesday, September 24th, 2008

I know that sounds sort of like a DirecTV commercial but I have to admit, I am completely and totally addicted to NFL Sunday ticket.  I hate the NFL for making me have satellite just to watch every NFL game, but we take the cards that have been dealt to us, so it is that I have directv instead of cable.  As most of you know by now, we are moving soon (this week actually) into the new house so I have had the oh-so-fun task of transferring services from Lauren’s house to our new house.

Here are the changes we are making:

-Upgrading our second receiver from regular to HD-DVR for the bedroom
-Adding a HD-Receiver to the loft
-Adding a HD-Receiver to the office

All of this was going to cost a total of $130.

Seeing as I always preach to try and ask for deals, I figured I’d better try and strike a deal. The conversation went like this:

Jesse: “$130 huh?  Hmm, thats a little expensive”
Directv lady: “Well sir, you are getting quite a few upgrades and changes to your service.  I’ll go ahead and get that going…”
Jesse: “(interrupting), well I need to check and see what all our options are before I commit to anything.  I can call back later on.”
Directv lady: “We might be able to get you an upgrade in here for free.  How about a free move and free upgrade to HD DVR for the second receiver?”
Jesse: “Can you add and upgrade the other two for free as well.”
Directv lady: “let me see what I can do….<away for a few mins>….ok sir, we can do all that as well.”

Followed by her setting up the move.  We’re about to get off the phone then I say:

Jesse: “So when we first started our package was cheaper, why was that?”
DTVL: “That was an introductory package.”
Jesse: “I want to get back on that”
DTVL: (silence)
Jesse: (silence)
DTVL: “Well sir, that was an introductory package”
Jesse: “Im moving, thats sort of like starting over”
DTVL: “Let me check what we have…”

Boom $20 off every month for the next six months, at which point I will call again and ask for another discount.  $120 right there.  But we’re not done.

DTVL: “Thank you for choosing directv, is there anything else I can help you with.”
Jesse: “Yeah I will be missing a week of NFL Sunday ticket, I would like to get a discount on it.”
DTVL: (sigh)

$60 off Sunday Ticket. 

Total savings: $310 

Go forth and get deals.

Save yourself hundreds (or thousands) by just learning a little bit – I saved $800 in one day

Tuesday, September 23rd, 2008

Ah what is this magical thing I must learn!?  Is it how to sell things on eBay? (No)  Is it how to  write a blog? (No, trust me on that one).  Today I will teach you enough to where you can save yourself at least part of that money.  The rest will be up to you.

In fact it is nothing you will see on any of those “How to make money/save money/be frugal/whatever” websites.   Its something much simpler.

Ok, I will stop dragging this out, for those of you that get annoyed when I don’t get to the punchline in the first few sentences of my paragraphs (And you would be surprised, some readers get very annoyed with me for that.  C’est la vie, eh?).  Its a little thing called:

Learn to be handy.

I know that there is at least a certain percentage of people that immediately dismissed this as soon as I said it, but its downright true.  A couple weekends ago Lauren’s car stopped driving in the middle of an intersection.  It didn’t die, it simply stopped going.  Instead of immediately calling a tow truck and having the car towed to the nearest garage and having them diagnose and fix the problem (Ill get to shop estimates later.  The Stealership wanted over $800 just to fix it)  I nursed it into the nearest parking lot.

I began to take some mental notes about how the car was behaving.  Since the engine would not rev my first thought was a fuel problem.  This is your first step to saving money.  In order to pinpoint common problems you need to figure out where the problem is originating from.  I did not smell gas and the car was remaining on despite the lack of response from the throttle.  This made me less suspicious of a fuel related problem because generally if there is a fuel problem the car will not run, or will be very sporadic.

I also pushed transmission problems to the back of my mind because of the lack of engine revving, and the gears would still shift flawlessly between drive where it would creep forward and reverse where it would creep backward.  Next (several times) I shut the car off and restarted it.  It labored to start, and the lights dimmed a lot.  Aha! We’re on to something.

If funny things are happening with your electrical there are 2 major culprits: battery and alternator.  Your alternator is the piece of your car that recharges the battery while the car is running.  It has a drive belt hooked to it which turns a wheel, which generates the electricity to charge the battery.  In our case, I had just replaced the battery recently so I had a strong suspicion that it was the alternator.  Which brings me to my next points:

DO NOT PAY TO HAVE YOUR ALTERNATOR TESTED IF YOU THINK IT IS BAD. Places like Autozone will test it for you for free.  I had my dad come and give Lauren a ride home and then use his battery to charge our battery for a while. (Heres another tip: you can recharge a battery just by doing what you would do to jump start a dead battery, hook positive to positive and negative to negative.  This is something that confuses a lot of people, but you want to create a parallel circuit).  Lo and behold, the car would drive after some charging so I drove over to autozone and sure enough, alternator dead as a doornail.

Now we know what is broken, oh Lord, what next?

I will just tell you, I wanted to be lazy about it because we have so much else going on and have a shop do it, so I called around and there was nothing less than $500.  The Stealership as I mentioned earlier wanted $800+ to fix it.  So guess what, time to do some car work.  I know it can sound like an overwhelming task but the truth is working on cars is more method than anything else.  They are very complex machines, but for a lot of common car problems, the fixes are fairly easy.  So if you don’t know where to start, heres some steps for you:

1) Find the shop manual for your car – Most of these can be found online and they are very different from the owners manual, or even the owners repair manuals.  These things are huge, usually thousand pages or so.  I found the PDF for Lauren’s altima online for $10.

2) Determine if it is something you believe you can do – There are some things you just wont be able to do.  For example, anything involving the engine block.  There are plenty of common ones that are very fixable though: alternators, fuel pumps, fuel filters, radiators, brakes, batteries, water pumps etc.

3) Consider the age of your car – As a general rule older cars are easier to work on.  This isn’t to say you cant work on new cars, Laurens car is a newer Altima and I have even done work on my 2007 350Z.

4) If you are nervous, document every step –  A car is just a huge assembly of parts.  Thats all it is.  Note how and where you took everything off, and you will have an easy time putting it back together.

5) Dont get frustrated – There is always 1 bolt that does NOT want to come off.  Make sure to use the right size wrench so as not to strip it.  If you need more leverage, here is a little trick, get a piece of pipe (PVC, copper, whatever) and put it over the wrench handle to essentially extend the size of the lever.  Force over distance my friends.

 6) Ask for help – If you are stuck or frustrated, you must have at least one handy friend that you can convince to come over and help….after all, a dinner and some beer in payment is still better than an $800 repair bill.

It took me a good solid 8 hours to fix everything on her car, but I managed to do it for parts only.  The total cost?  $150.  If you figure time invested 8 hours for $800, thats $100/hr after tax that my labor was worth.

A reader makes 180k but can’t afford groceries – consolidation loan dangers

Thursday, September 4th, 2008

I had a reader write in with a  story that happens all too often…I myself have been guilty of it at one point.  Its a little thing I like to call “good intentions gone bad.”  So what exactly am I talking about?  Consolidation loans.  Particularly consolidation loans as they relate to budgeting and money habits.  Ive had a few emails along these lines but never someone with so much debt….and so much income.  Here is the reader’s letter:

“Hi Jesse,
I admit I feel kind of weird writing to a guy on the internet that I dont know (but I know a lot about your life at least, does that count?) but I feel like I need to.  I have been reading financial websites for a while and I find you to be the most down to earth and real of most sites.  Some of “huge” financial sites seem sort of idealistic.  Anyway whatever.  I am writing because my wife and I are in a very difficult situation that we take full responsibility for but we do not know what to do from here.   We are both in our early 30s and we both make about 90k per year, so you would think that we are living large, but quite the opposite, we can’t even afford groceries.  See, a few years ago when we both were promoted.  We bought a house here in California for 600k.  Its by no means a mansion, housing is just very expensive here.  Then we went on a vacation that cost about 8k, which we put on credit cards.  It just spiraled out of control from there and we found ourselves with 40k in debt + 30k in student loans.  We did a consolidation loan and got one fixed payment on the 40k at a good rate.  The problem is, we have charged our credit cards back up to about 10k.  Should we get another consolidation loan?  You have everything, houses, a nice car, and now a baby.  We make a lot of money but our minimum payments take up most of our income!  I called some hot line and ended up hanging up because first I felt stupid then after sitting through a fairly humiliating interview they told me they could help at a cost of $20 an hour!  How is that helping, I need $20 for food and gas right now.  We would like to sell our house to get rid of that but housing prices have dropped it I don’t even think we can get out of it what we bought it for.  I have to tell you, Im hopeless right now.  My wife and I fight about money every day.

Thank you for your website, I am depressed when I see your stock picks because I know I will probably never be out of this debt to even try investing in any of them.  But I appreciate it anyway.

Thanks,
Grant

PS you can publish this if you want, I know sometimes you tell reader stories.  I guess I can be what not to do.

Before I respond I am going to give a little bit of a primer for anyone who needs it:

Consolidation loans are loans that are supposed to work like this: Take one of these loans out. Pay all of your different credit card debt and other debt down with the loan. Pay one monthly payment with a lower interest than what you were paying before. Its all good then, right?

It’s only a good deal if you create a budget and stop spending. Grant has fallen into the most common trap in with consolidation loans: consolidating and then spending like its business as usual and running the credit cards back up. So now they have their new credit card debt AND their consolidation loan debt.

Getting back on track, here was my response to Grant:

Grant,

Thanks for writing, I appreciate you taking the time to write in.  There is no shame in talking about money issues, money is still a huge worry for me, especially with all of the things I have going on that you mentioned.  I appreciate the compliments, but Im sure my fiance would tell you I do not always have everything together 🙂  That being said, there are people that subsist on 1/10 of your income so I am glad you realize that this is your responsibility to take care of.

You have one major problem:

You HAVE to alter your spending habits.  That is the only way that anything will change.  Trust me, I know how hard it is.  I still have problems locking down to a budget.  It’s a tough thing to do but it is necessary, especially in your case.  Thats #1.  Cut up every one of those credit cards, right now.  Every consolidation loan in the world can’t stop you from spending more than you earn.  That is your job, and your job alone.

Next step: time for some drastic measures.  The absolute first thing to do is to pay down that credit card balance.  Do you have anything you can sell?  Time to start.  You mentioned gas money, well, when you are in that big of a hole, its time to stop driving if its possible.  You are in “bike 10 miles to work” territory…or public transportation if possible.  Since you do not have kids to worry about yet, you need to go to some extreme measures to get that debt down, especially if you can barely afford groceries.  If you have to get a second job on the weekend doing manual labor even, do it.  I assure you, being burned out from working all the time will be a much better fate than defaulting or filing for bankruptcy.

I want to stress something else too: you sound pretty hopeless, and let me tell you, there is hope.  If there is one thing I have learned in life its that things always get better and there is always hope.  The key is taking charge of your situation and doing whatever is necessary to get the problem fixed.  You can do it.  In fact, send me your paypal address and I will buy you 1 share of stock in one of my picks.

As far as the credit counseling goes, remember, credit counseling is code for “fraud” and is just another thing to siphon money.  Good luck man, if there is anything I can do to help, let me know and keep me updated.  Im sure readers will appreciate your story so I am going to post it, not as an example of what not to do, but to show what can be done.

Jesse

Stock Review: “Buckle” up and ride this stock into the sunset (BKE)

Wednesday, September 3rd, 2008

buckleAs most of you know, I am very selective about doing stock reviews. Whenever I am not sure what stock to investigate I always go back to one thing: what is something or somewhere that I shop at, buy, or find useful. I also will only write a review on something that I have watched for sometime. Lately however, even everyday stocks have are getting slaughtered. Especially bad are the numbers for fashion retailers. On a whim I decided to check out where I got my last pair of jeans, a little store I like to call The Buckle. Ok so they call it themselves The Buckle as well (BKE). They are a retailer of medium priced but higher quality clothes. They have been managing to eke out profits while everyone else is tanking or hurting, and guess what? Its the end of summer, pretty soon people are going to be buying fall/winter clothes.

Some things I like about The Buckle:

-A look at executive transactions reveals that in the past 8 months, excluding the CEO Dennis Nelson who is fairly steadily income-selling, shows that the Buckle execs have actually acquired more than they have sold. In fact there is a whole sheet of people exercising their stock options…including Dennis Nelson.

-Royce Funds own 100 million in stock. This fund family has one of the better rates of return over the past few years.

-Insiders own 47% of outstanding shares in the company including massive portions by Daniel Hirschfeld, the son of the founder of The Buckle.

-Company has zero debt. Imagine that.

-The average sales per square foot grew 2% annually over the past 5 years.

-They promote store managers from within. The average district manager has been with the company 20 years.

-The company has bought back company stock (always a good sign).

-They pay one of the highest dividends in apparel retailing with the current yield around 1.8 percent.

Buckle is a company that makes money year in, year out no matter the economic conditions. They aren’t the store you necessarily when you think of fashion but they are solid. Senior management, all experienced retailers, is committed to growing the business. They have redesigned their website, and have a great marketing curve.

This all adds up to a very solid business and as I said before, we are just coming into a new clothes buying season which means the short term looks great….and considering all of the above, the long term looks even better.