Search Results for “how-to-complain-the-squeaky-wheel-gets-the-grease/budget-lesson-part-3/medical-costs-and-choices/selling-your-home-the-real-estate-agent/budget4” — Page 8

Selling Your Car

: English: Jalopy car in Joshua Tree National Park in Hidden Valley Campground (Photo credit: Wikipedia)

When it’s time to replace your car, most people focus on the new car, instead of the old, but that is ignoring real money. Your old car–unless it has disintegrated–still has value. Sometimes, it’s just time to ask yourself, “When should I sell my car?”

When you’re looking to sell your car (like with We Will Buy Your Car), you generally have several options:

Tow & crush. If your car has been wrecked, doesn’t run, or is just old and beat up, you may be stuck with calling a junkyard and accepting $50 for them to pick up your car and crush it for scrap.
Trade it in. This is probably the least hassle, but–other than #1–doesn’t pay well. Dealerships are willing to pay something under what they will get at a wholesale auction, which is quite a bit less than the blue book value.
Sell it yourself. Now you’re thinking, “He’s going to buy my car! Oh, bother.” It can be a pain, but it’s also the best way to get a decent price for your wheels.

When you sell your car, there are a few things to keep in mind, much like when you sell something on Craigslist.

Don’t be alone. There are bad people in the world, but they don’t like witnesses. Bad things are much less likely to happen if you have company.
Know your price. Specifically, know three price: your dream price, the price that would make you happy, and the absolute lowest price you are willing to accept. Make sure you figure these numbers out ahead of time. Know what you are comfortable with before it comes time to close the deal.
Check IDs. The buyer is going to want to test-drive your car. That’s fine, but you want to make sure you know who is driving off in your car. “Officer, Sumdood took my car. He was wearing jeans.” That won’t get your car back.
Clean it up. Get the car detailed before you show it to a potential buyer. A sparkling-clean car will almost always bring in a few hundred extra dollars. It’s well worth the expense.

Following this plan should make the sale go as smoothly as possible and bring you the most possible money.

Readers, what have you done to dispose of an old car?

This is a sponsored post written to provide some insight into the world of used car retail.

How to Live Happily Without a Budget

Finance

Three years ago, we sat down and built our budget. We spent 9 months adding the non-monthly bills that we forgot about when we created the budget. Setbacks and shortfalls almost killed the budgeting plan completely. It took almost an entire year to get our budget right.

Unrelated Image

Now? I refer to the budget once per month. No more. I don’t check it at bill-paying time. I don’t think about it daily. It’s there as a reference when I need it, but it no longer drives our finances. How did we get to that point?

First, we firmly established our budget. We know exactly what we need to cover our expenses. None of the predictable bills catch us by surprise any more. This is important.

Once we had the budget established, the rest was easy. I moved almost every bill to US Bank’s online bill-pay system and switched to electronic billing and automatic payments. The automatic payments are all through US Bank. I only allow my mortgage to be set up with the merchant. I want total, instant control over the rest. I won’t call a merchant to ask them to change a payment if something comes up. The bank sends me an email when a payment is automatically scheduled, and again when it is paid.

Once I got comfortable with the automatic payments, I switched to electronic billing. I don’t need to see the bill or waste the paper if I know it is being handled for me which is why I encourage you to manage all your finances online. I do check the few bills that may change, like the credit card and cell phone. Now, I see few of my bills. They are all sent electronically to my bank, automatically paid, and scheduled in Quicken–all without intervention from me.

[ad name=”inlineleft”]We also use an envelope system. I know how much we need for groceries, baby crap, clothes, etc. At the beginning of the month, I take out all of that money in cash and put it into the appropriate envelopes. Other than this money, almost everything else takes care of itself. I don’t need to pay attention to by bills on a day-t0-day basis. Any extra money that comes in gets divided among our debt repayment and savings goals, which only takes a few minutes to arrange.

I glance over my budget at the beginning of every month, but I only review it when something changes. If we change our cell phone, or our budgeted gas bill changes, I make the change to our budget. Other than that, it’s not even an afterthought.

That’s how we do it.

Another option includes the Sloppy Math System. This consists simply of rounding deposits down and rounding expenses up. The more you round, the better the system works. If you round every deposit down $50, and round every expense up to the next $10, you are naturally building more room for error. Given enough time, you will have enough of a slush fund to handle emergencies and the occasional impulse purchase.

Daytrading Bitcoin and Cryptocurrency

Business

For the past 6 weeks, I’ve been playing with Bitcoin and Litecoin.

The bitcoin logo (Photo credit: Wikipedia)

I can hear you from across the internet. You’re asking, “What the hell is Bitcoin?”

I’m glad you asked. It’s a cryptocurrency.

And now you know as much as you did before.

Cryptocurrencies are anonymous internet-based money. You spend it just like money, though granted, there are fewer places that accept cryptocurrency.

The big name in cryptocurrency is Bitcoin. In second place, trying to play silver to Bitcoin’s gold, is Litecoin.

So what do I mean by “playing with” Bitcoin and Litecoin?

I’ve been daytrading, which is generally a horrible idea…when you’re doing it with stocks. Daytrading is gambling. It’s the art of doing short-term flips on a stock. You buy it today to sell tomorrow, hoping it goes up. With stocks, I play a long game. I buy and hold. I buy a stock that I believe has long-term value, and I hold it for months or years.

That’s not the game I play with BTC and LTC. I play a short game, rarely longer than a week. When the coins are at a low price, I buy, then I immediately sell when they price is higher. When it’s high, I short the coin, essentially selling coins I don’t own to trade back when the dollar-price is lower. When I’m paying attention, I make money as the coins go up and I make money when the coins go down.

Why is this a good strategy for cryptocoins?

Because they are extremely volatile. As I’m writing this, Litecoin has had a 10% swing today, from $4.03 at midnight, to a current price of $4.16, with a peak of $4.36. On Thursday, it was floating around $4.60 all day. In the last 30 days, it’s been as high as $8.65 and as low as $3.18. Go back to May and the low is $1.29.

Traditional wisdom says that volatile investments are bad. In traditional investments, that’s true. But when a stock is this volatile, nearly every bet is a good one, as long as you’re patient. If I buy LTC at $4.20 and it drops to $3.90, that’s bad. I lost money. But, if I wait a couple of days, it’s almost definitely going to climb back up. Except for large-scale sell-offs, it’s usually going to bounce 10% in a given day. You can buy in the dips and sell at the peaks all day long, turning 5-10% profits with each time. If you’re brave or stupid, you can short at the peaks and make 5-10% on every downturn, too.

For example, today started at $4.03. Buy. Today’s peak was at 7:15AM at $4.36. When the graphs start swinging down, sell short. Two hours later, it bottomed out at $4.20 for a 4% return. Then, buy while it’s low. Ninety minutes later, it was at $4.31, another 3% return. Short it again, then close the position at 7PM for $4.13.

Let’s walk through this.

Buy $10 worth of Litecoin at midnight, sell at 7:15AM. You have $10.81.

Turn around and short the same amount until 9AM. You have $11.22.

Buy that same amount to sell at 10:30AM. You have $11.51.

Short it again before closing out at 7PM and going to bed. You have 12.01. That’s almost a 12% return in 12 hours, assuming you guessed all of the major swings right. If you guessed some wrong, you’d just have to wait until the next time it swung your way, and it will. Did I do that well? No. I bought in at $4.008 yesterday and sold today-once-for $4.32. I will not complain at an 8% return over 12 hours.

The only exception to that is during major buying and selling streaks. On July 5th, a major buying run started. By July 8th, the price was run up to $8.65. A huge sell-off happened then, dropping the price to $4.36 on July 9th.

If you bought at $8.65 you’d be hosed.

The lesson there is, don’t buy at the peak. I’ve had a number of trades that could have been huge scores if I would have held onto them longer, but I’m a wimp. I sell as soon as I’ve gotten enough money to make me smile, then I refuse to regret the decision. That also prevents me from holding on to my positions too long. I avoid all of the crashes that way. That giant buy-in happened while I was on vacation, so I wasn’t paying attention. When I’m not paying attention, I leave my money in US dollars, so there’s no risk…and also no reward.

Also, an important caveat: while I am learning the cryptocurrency ropes, I’m playing with a non-critical amount of money. I put $75 into the exchange in June. Not enough to cry over losing, but enough I can play with all of the different investment options. As I said, I’m a wimp, although a 30% return in 7 weeks is pretty sweet.

Next up, I’ll show you how to get started investing/gambling with Bitcoin.

3 Reasons You Hate Your Budget

Finance

: Image via Wikipedia

One of the first steps in clearing up your financial mess is to set up a budget. You need to figure out how much money you are making, how much you are spending, and what you can do to keep one of those numbers smaller than the other. If your income is smaller than your expenses, you’ve got work to do. If not, yay!

Even if you don’t obsessively cling to your spreadsheets and calculator, you need to spend the time to establish a budget–at least once–to know where you stand. When you do, you’ll find out it sucks. With good reason.

1. It takes too long to set up. Setting up a budget can be a long, drawn-out pain in the butt. Fortunately, it doesn’t have to be, but you won’t know that until after you make your first budget, then see some fairly drastic changes, and make a second budget. That one will be easier. For the first one, just concentrate on making a list of all of you regular bills and how often they are due. Don’t be surprised when you miss some. I missed a couple of our quarterly bills. All told, it took a year to get our budget completely done.

2. It doesn’t lie. Once you have all of your expenses down on paper, you are done hiding. You can’t tell yourself it’s all puppy dogs and ice cream when you are staring at the giant red pit that is the negative balance of your bad decisions. Nobody likes the messenger who brings bad news. When your budget shows you how big the hole is, you are going to hate it. That’s when it’s time to confront the problem head on and get out of the hole. Find the problems and rip ’em out. Cancel the cable, taxidermize the cats, and start buying generic underpants. It’s time to take an honest look at your situation. If you can’t handle where you are, how are you going to get where you want to be?

3. It’s not fun. When your friends go out, but you stay home because you’re broke, you will hate it. Y’ou’re also gonna hate comparing your old cell phone to the iPhone in the hands of the d-bag contemplating bankruptcy. Like Dave Ramsey says, “Live like no one else, so that later you can live like no one else.” Skipping some of the fun now will turn into security later. When you get to that point, it will have all been worth it.

Why do you hate your budget?

New Debt

Finance

music therapy — Image by emanuela franchini via Flickr

For the first time in 2 years(almost to the day), I am acquiring new debt that I can’t afford to pay off immediately. On a credit card.

Last Thursday, my son entered vision therapy. He has what is commonly known as a “lazy eye”, but is more properly called a “wandering eye”. His eyes don’t always lock on to whatever he is looking at. Instead, one of his eyes will (occasionally, but not always) drift to the side and shut off. His brain doesn’t interpret the signals from that eye.

We had two sessions of tests to diagnose the specific problems: $350.

We will have 28 weekly sessions of therapy @ $140 per session: $3920

There is an equipment fee: $85

That’s a total of $4355 over the next 7 months.

Insurance covers some of it, but the therapist is out-of-network, so it’s “pay first, get reimbursed later from the insurance company”. If we pay up front, we get 1 session free, bringing the price to $4215, minus insurance.

I have a health savings account that I have been trying to max out to cover this, to make my payments all pre-tax. I haven’t been able to get enough in there, yet. In fact, since I don’t have my kids on my insurance, my maximum HSA contribution is $3050.

Since finding out that vision therapy was going to be necessary, I have managed to save $1000 in cash, and about $1500 in my HSA. That’s $2500 of a $4215 bill, leaving $1715 that I still need to be able to cover.

Here is my plan:

We’re charging the entire $4215 at 11.9% interest on a card with a 2% travel rewards program. This will give me $84.30 worth of travel rewards good for reimbursing any travel expenses.

I will immediately pay off $1000 from cash savings.

I will also immediately file for an insurance reimbursement, which will cover 80% – $500, or $2972 minus a bit. Our insurance got a waiver on the pseudo-wonderful healthcare ~~fraud~~ act on the grounds that the plan sucks so bad that it would cost too much to comply with the law. No joke. I’m expecting about a $2500 reimbursement, and I have no idea how long that takes.

In 6 weeks, when I have maxed out my HSA contributions for the year, I will file for an HSA reimbursement for about $2500, leaving about $500 to cover some medical costs for the rest of the year. Vision therapy doesn’t count against my deductible, since my kids are on my wife’s insurance plan.

Starting in June, my debt snowball will no longer be going to max out my HSA and will instead go straight to this card, to finish paying it off as quickly as possible. That’s $750 per month.

Any money from any side work will also go towards this bill, but I don’t budget for that, because it isn’t reliable money.

The projected results:

$3215 on the credit card for 6 weeks @ 11.9% = $50 in interest payments.

After the HSA reimbursement, there will be $715 left to pay, which will be paid off in June for another $10 in interest.

When we get the insurance reimbursement, we’ll replenish the medical bill account, to start getting ready for the kid’s braces next year. We’ll drop $1500 into that account and use the remaining $1000 as a debt snowball payment.

We’ll end up paying $60 in interest to save $140 in therapy costs, so it’s good math, but I hate the idea of racking up another credit card bill. I could drop the interest costs a bit by raiding my emergency fund, but that still wouldn’t cover it all, and it would leave me with very little left for an actual emergency. I could raid the emergency fund for half of its value($700), and reduce the initial interest paid to $25 and the total interest paid to about $40, then use the $1000 leftover from the insurance reimbursement to replace my emergency fund.

Babies Are Expensive

Finance, Parenting

From the comments here. The discussion is on how much it costs to have a baby. Edited for clarity.

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Actual birthing costs vary. We’ve had three kids over ten years and birthing costs have varied from $250 out of pocket to $8500. Our highest and lowest price births were 20 months apart. The highest price birth involved induced labor with an epidural. For the lowest out-of-pocket price, I added my wife to my policy before the birth, so she was double-covered. If one of your policies is less than ideal and there are multiple policies available, I recommend doing this. It saved us thousands. All told, If things go well, you could slide for as little as $1500 total.

For the highest price birth, we threw ourselves on the mercy of the finance department. They have a charity fund to pay the bills of the less fortunate. We qualified…barely. If you have a medical bill you can’t afford, ask if there is a grant or donation you can apply for. Always ask if there is some way the bill could be lowered.

Breast-feeding beats the heck out of formula, financially, but breast-feeding doesn’t always work. Ignore the boob-nazis who insist you are slowly killing your kid by using formula. I’ve got 3 kids, and each had different feeding issues.

Baby formula runs $19 for a big container at Sam’s Club, or a large percentage of your soul at most other big box stores. Formula alone will pay for your membership in under a month. For a big eater, that’s $20-30 per week. For a normal eater, 2-3 weeks. For planning purposes, assume $100/month in formula costs for the first six months, when food starts coming into play heavily. After that, the formula expense goes down, but not away for at least 6 more months.

Diapers are painful. Not just the smell–though that hurts, too, sometimes–but the expense. I currently have 2 in diapers; one is potty-training. Our monthly costs for diapers, now, are about $75. It was easily twice that when they were younger. Figure at least $100 per month in diapers. Unless your baby has irritation problems, go with cheap diapers. Leak-guard is a joke. If you are relying on leak-guard to keep the contents inside the diaper, you aren’t changing your baby often enough.

I couldn’t begin to guess at how much you’ll spend on baby clothes. I have never bought clothes for our kids. Whatever didn’t come free from friends and family walked into the house of it’s own volition, following my wife home from the store.

Toys are an almost purely voluntary expense. You’ll get as much as the kids needs free, as presents. You’ll go overboard and give the kids 10 times that, without realizing it. Don’t. For the first four to five months, its fingers and toes will be entertaining enough. After that, if there are more than about ten toys, it’s too many; the kid will never get attached to any of them. Keep it small. It’s better for the kids and the budget. Little kids prefer boxes to toys, anyway. Give the kid a shoebox instead of a Leapfrog. Really.

Portraits suck, too. If you have to get them done professionally, get a membership that covers sitting fees, and use coupons. I recommend JC Penney’s. Using judicious coupons and the membership, we get portraits for under $20.

Baby food is probably cheaper to make in a food processor, but you can’t beat the convenience of the little jars. If you watch sales, you can stock up affordably. Mix every meal with some rice or oatmeal mush to stretch it, without making it unhealthy. Depending on your kids, and how much you listen to the “experts”, this is a nonexistent expense before six months. Our kids started eating baby food in their second months, at least a little bit.

Babies are expensive. Don’t doubt that for a second, but ignore the polled averages when it comes to expense. Hand-me-downs, thrift stores, and good sales cut the expense a lot.

How do you save money and value with a baby in the house?

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