How I Avoid Late Fees

Get Out of Late Fees!

No More Late Fees!

So you have been hit by a late fee- what can you do to avoid paying it?  Surprisingly, you may be able to get out of a late fee with one phone call and about 5 minutes of work.

Back when I had satellite TV, my credit card I was using for autopay expired and I got hit with a $25 late fee.  I was able to avoid this late fee by calling in and simply asking for it to be removed.

Yes, it really can be as simple as just calling and asking for your late fee to be removed.  I was also able to call my credit card company and have a late fee removed just by asking.  The representative said that they will waive the first late fee you get if you call in and ask.  

You may feel that if your payment is received late that you did something wrong and deserve to pay a penalty.  I don't see it that way.  The cost of a delay of a few days in receiving a payment is almost too small to measure.  Late fees are pure profit for the companies that charge them, and I am happy to spend a bit of effort to avoid paying extra. 

Another strategy I have used to get out of late fees is to simply not pay the late fee.  My bank sends my bill for my safe deposit box late every year, and it has a $10 late fee added by the time I receive it.  I send in a payment only for the safe deposit box and leave off the late fee.  I sometimes add a short note that I received the bill after the deadline.  This has worked every time so far.

Sometimes you can ignore late fees and they will go away, but this strategy does not always work...

My Late Fee Battle With the Utility Company

Before I signed up for autopay a few years ago, the utility company once received my electric bill payment one day late and I was charged a $10 late fee on my next bill.  I though this was ridiculous.  The utility company had to wait one day for my $100 payment, so the $10 late fee on $100 for one day late is equivalent to paying 3650% annual interest rate to the utility company.

I thought this late fee was crazy and I simply did not pay it.  Every month, I payed for all of the electricity I used, but did not pay the $10 late fee.  About 9 months later, I got a call from the manager at the utility company.  I explained that I was not paying the late fee and that is why I had an unpaid balance of $10 every month.  I asked if the late fee could be removed  The manager explained that the entire balance must be paid.  

I continued paying only for the electricity and not the $10 late fee for a few more months, and then one day I found a pink letter taped to my front door.  It was a disconnect notice.  If I didn't pay my bill in full within 48 hours, my electricity would be disconnected and I would have to pay $150 to get it connected again after I payed my bill.

I gave up and decided to pay my late fee.  What else could I do?  In retrospect, I should have called the utility company right away to request having the late fee removed.  If talking on the phone didn't work, writing a letter would be my next step.  I would have had a better chance to have the late fee removed from my bill if I had contacted the billing party right away.

Dealing with a utility company is sort of a unique situation, because I had no options to cancel service or switch to a different utility company.  I had no leverage at all, so the utility company had no motivation to consider waiving the late fee.  Most companies you deal with on late fees will be more likely to be persuaded to remove the late fee if you request it.

How To Avoid Late Fees

Back in the bad old days, I paid my share of late fees.  I would sometimes lose track of my bills and end up paying a few days late.  Paying a bill late can result in a late fee of $40 or more, depending on the bill.  In the days before electronic bill payment options were available, I remember once paying nearly $20 to overnight a check to avoid a $35 late fee.

Of course, you can avoid late fees simply by paying bills on time.  I have put many of my bills on automatic payment, and I use electronic bill paying to pay my other bills, often the same day I receive my bill in the mail.  

When an occasional late fee mishap occurs, I have been able to avoid paying the late fee using the tactics I have described in this article. 

Here is a summary of tips on how to avoid paying late fees:

• Use autopay to guarantee on-time payment and no late fees
• Use electronic bill payer service from your bank to pay your non-autopay bills as they come in
• If you do get a late fee, object right away and ask that the late fee be removed from your bill.  You can sometimes have a late fee removed just by asking.  It is worth a try!
• If requesting a late fee be removed by phone doesn't work, try writing a letter.  The company may decide it is better to remove the late fee than deal with complaints and risk you moving on to a competitor.

Penny Pincher Journal

Copyright © 2015 by Dr. Penny Pincher.  All Rights Reserved.  Privacy Policy

Would You Wear Shoes With Duct Tape?

Why I Wear Shoes with Duct Tape

The other day my wife wanted me to wait in the car while she went in the store.  "Is it the shoes, or just me in general?" I asked.  After some consideration, she selected "the shoes" as the reason she wanted me to wait in the car...

Would You Wear These Shoes With Duct Tape?

When my shoes were dirty and foul smelling this spring, I gave them a bath and kept right on wearing them.

When my shoes got holes in them and my socks started getting dirty through the holes, I took action.  With a few cents worth of duct tape and a moment of my time, I may be able to get another year of use out of my tennis shoes.  Shoes with duct tape may not be the coolest fashion statement, but they work.

You may wonder why I patch up my old shoes with duct tape instead of buying a new pair.  The answer is simple: money.  I think spending money on a new pair of shoes when I have bills to pay is a terrible idea.  I would rather hang on to a little money for myself instead of paying $50 for a new pair of shoes.  There are so many things I have to spend money on, and new shoes is not one of them- as long as I have duct tape!

Wearing shoes with duct tape is not for everyone.  Most people would prefer to cut back on things that are less visible to others such as food or entertainment expenses.  Unlike most people I am ready, willing, and able to cut back on all of these expenses.

How to Extend the Life of Your Shoes with Duct Tape

Extend the Life of Your Shoes with Duct Tape

Here are some tips from my experience using duct tape to stretch the life of tennis shoes:

The key to using duct tape successfully on shoes is NOT to wrap the tape around the bottom of the sole of the shoe.  This makes the bottom of the shoes slippery.  I learned this the hard way on a previous shoe repair project when I nearly slipped and fell down while mowing.

Duct tape does not stick very well to the mesh material of tennis shoes, so I try to use the hard material along the edge of the sole as a place to get some good adhesion.  I also try to use fairly long pieces of duct tape and wrap it around so that it sticks to itself.

Another tip to make your shoes last longer with duct tape- make sure the shoes are really dry when applying the duct tape.  Duct tape will not stick very well if the shoes are damp or dirty.  It works best to apply the duct tape at warmer temperature, this seems to make the adhesive work better.

You might not be able to bring yourself to wear worn out shoes repaired with duct tape.  That's OK.  There are tons of other ways to save money instead.

Penny Pincher Journal

Copyright © 2015 by Dr. Penny Pincher.  All Rights Reserved.  Privacy Policy

Rent-to-Own Ripoff: Undercover Investigation

Investigating Rent-to-Own Store Prices

Disguise for Undercover Investigation of Rent-to-Own Prices

As a staff writer for Wise Bread, I was recently assigned to investigate rent-to-own stores.  Are Rent-to-Own stores a ripoff?

Following is a slightly fictionalized account of this undercover investigation.

---

"Great to see you, Dr. Penny Pincher," said my editor as I walked into his office.  He was seated behind a large mahogany desk with only a desk lamp and a mechanical typewriter on its vast surface.

"Likewise," I said cheerfully, removing my hat.  I hung it on the coat rack and closed the door.  I enjoyed coming to my editor's office because that meant a new article assignment, and that meant money.

"I think people are being ripped off at rent-to-own stores, but I can't prove it," he said.  I always appreciate how my editor gets right to the point.  He manages a lot of writers and has learned to be efficient.

"Interesting topic," I said as I sat down across the desk from him.   "But I have never bought anything at a rent-to-own store."

"We're going to send you undercover," he said.

"But undercover investigations can be risky," I objected.  "Maybe we should send in a private detective instead."

"I thought about that, but we need you.  This is going to require math," he said.

"I see," I said.  "But I still think it could be risky."

My editor opened his top desk drawer and pulled out a fat envelope with "rent-to-own ripoff" typed on it.  The envelope made a deep thump when he dropped it on his desk in front of me.  From its thickness and the sound it made, I couldn't tell if it contained more cash than usual or not.

After a second or so of deliberation, I scooped up the envelope and slid it into the inside pocket of my sport coat as I stood up.  "I'm on it," I said and started toward the coat rack to get my hat.

"Wait," said my editor.  "You can't go undercover looking like that.  They'll recognize you as Dr. Penny Pincher.  You'll need a disguise so you can see how they really operate."

"Roger that," I said as I put my hat on and headed out.

I realized my editor was right.  If I went into the rent-to-own store and they recognized me as Dr. Penny Pincher, they could change their deals so that they would look better in my article.

Dr. Penny Pincher- Before Disguise

I got off the city bus at a department store on my way to the rent-to-own store and picked up a new hat for $3 on the clearance rack.  My disguise was complete, and I was ready to begin my undercover investigation...

Dr. Penny Pincher- In Disguise for Undercover Investigation

One of the shocking things I learned is that buying a TV at the rent-to-own store would have resulted in paying an annual interest rate of over 140%!

Here is a link to the full article so you can learn how much it really costs to buy something at a rent-to-own store and learn about much less expensive options:  This Is How Much A "Rent-To-Own" TV Really Costs

Penny Pincher Journal

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Why Pay Too Much For Bad Coffee?

"Most people drink bad coffee, and pay too much for it.  I'm not sure which is worse..."  Dr. Penny Pincher

Me and My Great Coffee (Only 60 Cents!)
Image Source: Dr. Penny Pincher

You have probably heard of the "latte factor" that is described  by many personal finance experts.  The concept is that you can get ahead financially by saving or investing your money instead of spending it on buying a latte every day.  This is certainly true, but I don't think that many people are actually drinking lattes or other fancy coffee drinks that cost $3 or $4 dollars every day.

I do think that a lot of people buy $2 coffee at coffee shops or even pay $1.79 for bad coffee at convenience stores or fast food drive-thru windows.  Some people buy more than one cup of coffee every day.  I used to be one of those people...

I realized how much I was spending on coffee and decided to make coffee at home instead.  Over time, I figured out how to select whole bean coffee and grind it at home.  I learned a lot of tricks to make really good coffee at home for only 60 cents a day- I even wrote a book about it.



I also cut back from drinking several cups of coffee every day to drinking only one really good cup of coffee every day.  It can be a bit unpleasant to cut back on coffee since it is mildly habit-forming.  Here's how I was able to cut back on coffee and avoid caffeine headaches.

So even though I wasn't drinking $4 lattes, I was able to save a lot of money on coffee.  For the purposes of approximation, let's say I was spending $4 per day to buy 2 cups of coffee at a coffee shop.  Now I spend 60 cents per day on coffee.  This savings of $3.40 per day adds up to over $1,200 per year!

You might say that I have 60 cents more per day that I could cut on coffee, but I am not interested in cutting back on my one good cup of coffee that I make every day.  I think a great cup of coffee is worth far more than 60 cents, so I will make room for this in my budget and continue to enjoy my coffee every day.

If you have become stuck in a rut of paying way too much for bad coffee, consider learning to make great coffee yourself at home.  Not only will you save money, but you can get much better quality coffee as well.

Penny Pincher Journal

Copyright © 2015 by Dr. Penny Pincher.  All Rights Reserved.  Privacy Policy

My Sharing Economy: Getting By at the Office for Free!

Give and Take at the Office

The other day, someone at the office offered me a piece of candy, and of course I took it.  For one thing I was starving, the candy was free, I wanted it.  For another thing, it is sort of a bonding event to share stuff at the office with coworkers and I wanted to participate.

Of course to really participate, I would need to share something too.  I looked around my office thinking about what I could share that wouldn't put too big of a dent in my wallet, and my gaze fell upon a bowl of cherry tomatoes that I brought for lunch.

Perfect!  I had way more tomatoes than I could comfortably eat.  I washed each cherry tomato carefully, removed the stems, and even tried them off with a paper towel.

I walked around offering cherry tomatoes and telling my story about how I grew the tomatoes in a straw bale.  This is actually true- you can read how I grew my entire garden by planting in straw bales this year.  I even put some tomatoes in paper coffee cups and left them for people who were away.  It became a game for people to figure out where the tomatoes came from while they were away from their desk.

Everyone liked the tomatoes- from what I heard, none of them made it home with anyone.  They got eaten almost immediately or in the car on the ride home.  I am starting to want more of those cherry tomatoes as I read this.

I picked some more tomatoes tonight to take in to the office.  Not only are cherry tomatoes from my garden free, but they are healthy for people.  Maybe they will offset the effects of everyone eating candy today.  I also like that I have a unique thing to share.  I guess someone could buy a bunch of cherry tomatoes at the grocery store, but this would be expensive and they would be nowhere near as fresh as mine that are straight from the garden.

For me, I enjoy sharing something that takes a bit of work rather than spending money.  I think most people would rather buy a box of donuts or a bag of bagels to bring to the office and be done with it, even if it costs $20.  I can grow a lot of vegetables in my garden with $20 worth of investment.

Sharing produce from my garden works great during harvest season, but what the rest of the year?  I have shown up at office events with canned salsa made entirely with produce from my garden.  Another neat- and cheap- thing to bring to the office is a fresh loaf of bread to share.  When I had chickens, I always had eggs to share- this was popular and cost me nothing since I had extras.

Protect your wallet by thinking about cheap ways you can participate in the "sharing economy"!

Penny Pincher Journal

Copyright © 2015 by Dr. Penny Pincher.  All Rights Reserved.  Privacy Policy

Fear of Muffins

Do You Know The Muffin Man?

Muffins for breakfast?  What could possibly go wrong?
Image Source: Dr. Penny Pincher

Where I live, the muffin man works at the local convenience store, about 3 miles away.  He, or maybe it's she, makes the muffins every morning.  They are really big and sell for $1.49 alongside donuts and cinnamon rolls.

The other day over Labor Day weekend, by son wanted go get muffins for breakfast.  This was a pretty reasonable request.  It was breakfast time, muffins are a relatively healthy breakfast food option, and my wife was at work so buying muffins would have been an easy way for me to take care of breakfast.


So why did I say no?

Fear The Muffin Man

My first thought was that driving several miles and spending that much time in the car would be a waste of time and money.  Next, the cost of muffins would have added up to $4.50 for the three of us, and what if my sons wanted to get a bottle of milk or something else too?  The money envelope would have been rapidly depleted.  Finally, there are other things that could go wrong on a muffin seeking adventure.  What if we drove all the way there and the muffins were sold out?  What if we got a flat tire or my 10 year old car broke down along the way?

I told my son that I had an idea.  "Check the cupboard," I said.  He quickly found what I was remembering.  There was a box of muffin mix.  Instead of wasting time and money, we could have all the muffins we could handle for a fraction of the cost!

Make Cheap Muffins at Home!
Image Source: Dr. Penny Pincher

I put him in charge of making the muffins.  In addition to the powdered mix and can of blueberries that came in the box, he added water, oil, and eggs.  After some mixing, preheating, and baking we had a dozen muffins.  We munched on muffins all day and even had some left to give my wife when she got home from work.

I don't know exactly how much the box of muffin mix cost.  I would guess around $3 since they have fresh blueberries.  Considering the cost of other ingredients and cost of electricity, I would say the muffins cost about 30 cents each to make at home.

Making muffins at home was much more enjoyable than driving to a convenience store to buy some- and much less expensive as well.

I think my son is the muffin man now!  If he can make muffins at home for 30 cents each, we have little to fear...

Penny Pincher Journal

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10 Things You Don't Need- Guest Post @ Frugal Fanatic

10 Things You Don't Need- Guest Post

My Guest Post at Frugal Fanatic!

My guest post is up today at Frugal Fanatic!  The subject is 10 Things You Don't Need.  This piece talks about some things you can easily cut to reduce your expenses and have more money left to pay debt or invest.

Addi did a great job formatting this, and I like the photo with the title.  Thanks for featuring my post!

Check out the post here to learn 10 things you don't need:  10 Things You Don't Need.

Here's a clue in the photo below about #1 on the list:

Penny Pincher Journal

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The Trouble with Having an Emergency Fund

Emergency Fund- Bad Advice?

I have read on many personal finance blogs that the way out of debt starts with building a cash emergency fund, with a goal of being able to cover several months of expenses using your emergency fund.

Although this may work well for some, for me there are several problems with this approach.

First off, I don't want to park this kind of cash in a savings account making 0% interest!  Let's say several months of living expenses amounts to $10,000.  If you keep this in savings account for 30 years at 0.85% interest, you'll end up with $12,903.  If you invest this money instead and get an 8% return, you'll end up with $109,357.  So having the cash emergency fund would cost you around $100,000!  You can run the numbers yourself on my savings calculator.

Not everyone who recommends having an emergency fund recommends keeping $10,000- I just wanted to pick out a number to make my point.

The next problem I have with building a cash emergency fund while you have credit card debt- if you have credit card debt at 20% interest, paying that down seems to me to me to be the best use of any available funds.  It would be hard for me to look at money sitting in a savings account and not pay down high interest credit cards.

My third major problem with advising people to build up lots of cash and keep it around- it would be tempting to spend it!  Even if you have credit card debt, if you have $10,000, or even $2,000 sitting in a savings account, I think many people would be tempted to spend it if the right opportunity came along.  Maybe a fun project car to fix up, or getting in on a special vacation offer, etc.  If you have $0 savings and mostly maxed out credit cards, it is harder to spend more money and you won't forget that you are in debt.  If you have money sitting around not being used, I think it would be at risk for unplanned spending.

In Case Of Emergency...

So, what if you don't have an emergency fund and a financial emergency comes along?  No matter how much you have in an emergency fund, something could happen that would take more money than you have saved up.  In this case, you would end up using credit or borrowing from your retirement fund to pay for the emergency.

This is not good, but I think most people would be further ahead focusing on paying down credit cards and building investment funds rather than parking cash in an emergency savings fund.  Hopefully that emergency won't happen, but if it does happen while you are still paying down credit card debt, you'll have some funds build up in investments and some credit cards paid off that will be resources to get through the emergency.

Is Putting Money In an Emergency Fund Bad Advice?

I discussed my concerns about emergency funds with a popular blogger, Chris Peach at Money Peach.  He replied that from the math perspective, my objections to advising people to set up an emergency fund make sense.  But from a behavioral perspective, getting people to develop the discipline to save money and watch that savings account grow is powerful and can change behavior.  Plus having a cushion can help people avoid charging more on their credit cards.

I think Mr. Peach had a nice comment when he said I can be right on my blog and he can be right on his blog.  Nicely said.  From my perspective, setting up an emergency cash fund when you could be paying down high interest debt or investing with a historical average return of around 9% doesn't make much sense.  But if you are trying to change your behavior and get away from depending on credit cards, maybe setting up an emergency fund could help.

Even with my reservations about putting a lot of cash in an emergency fund, I do keep cash around.  What if the electronic networks go down and credit cards don't work for some reason?  I like to have enough cash to cover a couple weeks of food and gas at least in case of a disaster.

In conclusion, having cash at home or in a saving account has a cost.  If you have credit debt, you could be getting a 20% return on the money.  If you invest in stocks, you could be getting a 9% historical average return over the long run.

From the perspective of optimal financial results, I would recommend people with credit card debt to pay into an emergency fund only if this will help control credit card spending.  Otherwise, use all available funds to pay down the high interest debt and at the same time invest some money in stocks.   I would suggest saving up enough cash to cover basic expenses for a few weeks to survive a disaster.

Penny Pincher Journal

Copyright © 2015 by Dr. Penny Pincher.  All Rights Reserved.  Privacy Policy

Pants Are Not Optional At Work!

When Pants Are Required... Quickly

What To Do If Your Pants Fail At Work!
Image Source: Dr. Penny Pincher

Sometimes at work I get a memo with a dress code for a meeting that says something like "shirt and tie".  I always joke that pants must be optional...

Last week, I was wearing some 20 year old pants at work and they failed badly.  I don't like to spend money on clothes, but my career is my most valuable asset, and I couldn't very well go walking around with my fly fully open all day!

I briefly considered some options to repair my pants with office supplies such as tape or staples.  I saw lots of opportunities to make a bad situation worse and decided not to repair my pants with office supplies.

The next option I considered was to drive home and change pants.  There were two problems with this.  First, I didn't have that much time- it would take me at least an hour to drive home, change pants, and drive back.  The next problem was that it would take a couple gallons of gas and put about 40 miles of extra wear and tear on my car.

So, I decided to run to the Kohl's store that was a few blocks away.  I had a Kohl's coupon in my car, and Kohl's has some great clearance bargains.  Kohl's was a natural choice.  I slipped out of my office before anyone saw my problem pants and soon arrived at Kohl's.

Clearance on Clothes at Kohl's- 80% Off
Image Source: Dr. Penny Pincher

The first pair of bargain pants I picked up had a waist of 40 inches and length of 30 inches.  Not even close!  After about 1 minute of scanning and looking for my size, I found some nice Dockers brown corduroy pants in just the right size: 34W, 34L.  And they were priced at $5.80.  With my coupon, the total ended up at $5.28.

Receipt For Emergency Pants
Image Source: Dr. Penny Pincher

I wasn't planning to spend $5.28 on clothes, so this is $5.28 of extra spending, but all things considered things turned out pretty well.  I could have missed an hour of work and spent money on gas for an extra trip home, or I could have used office supplies to repair my pants which may have looked ridiculous.

I wonder how long a pair of brand new Dockers corduroy pants will last?

Penny Pincher Journal

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Making My Old Shoes Like New Again

Shoe Wash Today!  I saved over $50...

Wash Your Shoes Instead of Throwing Them Away!
Image Source: Dr. Penny Pincher

I have not worn my "good" tennis shoes for a few weeks.  The cat decided to spray them, so I set them outside to get some sun and rain for awhile.  These shoes are a couple years old and have small holes in them, so I thought getting sprayed by my cat might be the end for them.

But these are some of the nicest tennis shoes I have ever owned.  I originally bought them for my son for $25 at Famous Footwear, but they weren't quite right for him.  I was going to take them back to the store, but that would take a driving trip and I needed shoes and liked these.  They were a size too small, but $25 was a great deal, and like I said, I needed shoes...

That was 2 years ago, and the shoes have been great.  They are very lightweight and have memory foam.  I decided to wash these shoes the old fashioned way and try to get another year of life from them.

I Washed My Shoes- No Need to Throw Them Away!
Image Source: Dr. Penny Pincher

My son also had a pair of shoes in the same situation (darn cat!).  I set the shoes on the grass and blasted them with a hose.  Then I put the shoes in a bucket, added some car wash soap that I had handy in the garage, and blasted them some more.  I let them soak in the soapy water for a couple hours, then scrubbed them with a scrub brush that I use to wash the tires on my car.

Next, I set them out to dry in the sun.  I should have shoes back in action after a few days of drying.  I am going to keep them somewhere where my cat can't get them.

Reusing two pairs of shoes instead of buying new ones will save over $50.  That's real money- $50 will buy a day's worth of food for the family.  Try washing your shoes to give them new life.  If you need to replace your shoes, check out how I got a pair of dress shoes for work for $25.

Penny Pincher Journal

Copyright © 2015 by Dr. Penny Pincher.  All Rights Reserved.  Privacy Policy

Recycled Plant for Hanging Basket = Free

Plant Rescued, Money Saved!

Our hanging basket got dried out after we forgot about it- I brought it back to life with lots of watering
Image Source: Dr. Penny Pincher

We got an outdoor flower in a hanging basket early this spring and forgot about it. It was dried out and looked mostly dead and the flowers were all gone. My wife mentioned getting another plant to replace it. I decided to try to rescue the plant (and also rescue some of the money in my wallet). I filled the pot overflowing with water every day and fertilized once a week. Now after a few weeks, it looks better than ever!

This worked out well for everyone involved- we didn't buy another plant, so my wallet is happy. We have a nice looking flower, so my wife is happy. And, of course, the plant is happy with how this worked out.

You might ask how much I spent on fertilizer and extra water to bring the plant back to life.  My house is on a community well, with no water meter, so the water was free.  You would think with unmetered water that people would use water like crazy, but surprisingly, people here are very careful with water.

I found the fertilizer in the garage from a past year, so I'm going to count that as free as well since I didn't have to buy it. 

I should note that the "Before" picture was actually taken after to give an idea of what the plant looked like.  It was actually much more dried out and I don't think there were any green leaves remaining.

Penny Pincher Journal

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The Bridges We Cross on the Road to Debt: Guest Post @ Modest Money

The Bridges We Cross on the Road to Debt

The Bridges We Cross on the Road to Debt
Image Source: Public Domain Image Courtesy of Wyncliffe

My guest post went live today at Modest Money, which is one of the top 5 personal finance websites on the internet!

The post is about how people get into debt, why being in debt is bad, and how to get out of debt- all in 1,000 words.

Here is my favorite quote from the guest post:

"There are bridges you cross on the road into debt. These bridges make it easy to go further into debt. When you decide to turn around and leave debt behind, you realize that there are no bridges on the way out. You have to swim across."

-Dr. Penny Pincher

I write about my experience on the road to debt and crossing the bridges of student loans, credit cards, car loans, and mortgage loans on the way in.

The quote above reflects how easy it is to sign your name and cross another bridge going into debt, but there is no such easy way to get out of debt!  Getting out of debt takes hard work to find ways to spend less money and make more money if you can.

I just saw on Twitter that Experian, the giant credit reporting agency, sent out a tweet with a link to the "great guest post by @Dr_PennyPincher on @ModestMoney"

Great Guest Post by Dr. Penny Pincher!
Image Source: Dr. Penny Pincher

Thanks to Modest Money for featuring my guest post.  This is my first guest post, so I'm pretty excited!  You can read the entire guest post here:

The Bridges We Cross on the Road to Debt

Penny Pincher Journal

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Air Conditioner Troubleshooting Adventures

Avoid Expensive Air Conditioner Repairs!

Avoid Expensive Air Conditioner Repair
Image Source: Dr. Penny Pincher

Summer has arrived, and that means it is time for central air conditioning if you have it, and if you are lucky enough to have it working.  As you'll see, I have not always been so lucky...

Growing up in an old farmhouse on a small farm, we had no air conditioning.  We had fans in the bedrooms and in the living room.  The downstairs wasn't too bad, but the upstairs bedrooms were pretty warm at night, even with fans going.  When I was about 14 we installed a window air conditioner in the living room.  I don't remember how much that cost, but I think it was about $100, and I know it used a lot of electricity.  We ran it on a few of the hottest days of the year and it made a big difference.

Tips to Keep Your Air Conditioner Working

Since then, I have owned several houses and all but one of these had a central air conditioner.  Almost every central air conditioner I have owned has had some trouble.  In general, there some simple things you can do to avoid trouble with your central air:

• Change the furnace filter regularly.  If the filter is dirty, it reduces the air flow and reduces the cooling effectiveness.  If you don't remember when you last changed it, it is probably due for a change...
• Trim back plants growing around your A/C unit to allow the heat exchange to work efficiently.
• Use fans instead of central air when it makes sense.  A fan right next to you can keep you cool, and using a fan is less expensive and saves wear and tear on your expensive A/C unit.

Installing New Furnace Filters Can Avoid A/C Issues
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Each time I have called a repairman to troubleshoot the central air, it has cost more than the window air conditioner that we bought growing up- just for the repair!  A new central air conditioner costs about $3,000 to install, depending on the size.  Repairing a central air conditioner costs $100 to $300 or more, depending on the problem.

This is Where Furnace Filters are Installed
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Air Conditioner Repair Incidents

Following are accounts of the incidents I have had with my air conditioner over the years, and an explanation of each problem.  Hopefully this will help you avoid some expensive service calls or at least understand what could be wrong with your air conditioning.

A/C Incident 1:  A/C running, but not cooling.  We moved into a house in the winter time and tried to turn on the A/C when summer came around.  Everything seemed to be running, but it just wasn't cooling.  I called a furnace repairman to come and check it out.  This system had a furnace filter installed in the ceiling, which I did not find when I was checking for problems.  Simply changing the very dirty filter made the A/C work well.  This service call was around $100!

How to avoid expensive repair:  Make sure you find your furnace filter and change it!

A/C Incident 2:  A/C not running.  My wife was 9 months pregnant.  It was July and very hot, with temperatures running over 100 degrees at nearly 100% humidity.  This was a house that I just bought, and I wasn't very familiar with the infrastructure.  The A/C stopped working mid-morning on the 4th of July.  I wanted to wait until after the holiday weekend to call a repairman since it was a holiday, but my wife was pretty uncomfortable anyway and it was only getting hotter, so I called a repairman right away.

The problem turned out to be a blown fuse in the fuse box right next to the A/C unit outside.  I checked the circuit breaker panel inside, but it didn't occur to me that there would be a separate fuse box outside with glass fuses.  The repair bill was around $200!

How to avoid expensive repair:  If your A/C unit stops running, check for a fuse box next to the unit.  You can probably get new fuses for about $1 each...

A/C Incident 3:  A/C running, but not cooling.  We lived at an old farmhouse that we were fixing up.  One of the first improvements we made was to add a central air unit.  It worked great for 3 or 4 years and one summer it just wasn't cooling.  I checked the furnace filter- but it was totally clean.  We didn't want to spend money that year to call a repairman, so we went all summer without using the A/C.  The next spring it still wasn't working.  I had been reading about A/C troubleshooting on the Internet and had isolated the problem to inside the plenum.  I wasn't willing to cut into it- we can live without A/C, but I didn't want to risk ruining the furnace.  Heating is not optional in Iowa...

So, after a year without working A/C, I finally called the repairman.  I was right that the problem was in the plenum.  Somehow, a bunch of dog and cat fur had accumulated inside and was almost completely blocking the flow of air.  Apparently a furnace filter had gotten very humid and collapsed, leaving the air return unfiltered for some time.  We had the return air cover off while working on some things, so tons of fur got into the furnace.  After the repairman removed the fur mat that had formed and sealed the plenum back up, it was good as new.  It cost over $300 for this repair!

How to avoid expensive repair:  Make sure your furnace filter is installed correctly and is in good condition.  Dirt and fur can cause real problems if they get into your plenum.

A/C Incident 4:  A/C not running.  This incident happened at the farmhouse as we were selling it and moving out.  We needed to repair the A/C so it would be working for the buyer.  The problem was that a mechanical component failed in the air conditioner.  I didn't pay much attention to what it was since we were moving out.  This repair cost about $150.

How to avoid expensive repair:  Some repairs cannot be avoided-if your A/C has a mechanical failure, it will need new parts.

No More A/C Problems!

This is my second summer living at my current house and I have not had any trouble at this house with my air conditioner... not yet anyway...

Good luck staying cool this summer, whether you use a fan, window air conditioner, or central A/C.

Penny Pincher Journal

Copyright © 2015 by Dr. Penny Pincher.  All Rights Reserved.  Privacy Policy

The Lunchbox- A Tool To Save Money Every Day

The Lunchbox- My Tool To Save Money Every Day

I didn't spend any money again today!  A key reason for this success is that I did not need to buy any food, beverages, or snacks all day.  The lunchbox helps a lot with this.

My Lunchbox Holds Enough To Last All Day!
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I have the biggest lunchbox I have ever seen.  Its intended purpose might been as a 6-pack cooler or something, but I like that I can pack a full-sized box of cereal or full-sized Tupperware containers.  It is a soft-sided insulated box and has a nice padded strap for easy carrying.

My Giant Lunchbox
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Every day, I put a couple re-usable freezer packs in the bottom and then load it up.  Usually I have some refrigerated left-overs.  I often take yogurt or cheese sticks.  Bananas are a great item to pack- they only cost about 25 cents and have a lot of nutritional value.

Today I packed a jar of peanut butter, a knife, and a bagel to make a protein-packed breakfast.  I also raided my kid's supply of generic apple sauce.  Sometimes my kids write on their food with a marker so I don't take it, but I did not see any such markings on the applesauce!

Beverages

I like to drink coffee while I drive.  I drank my "good" coffee made from fresh ground whole beans long before I started driving, so I made a travel cup of instant decaf for the road.

Take Coffee From Home- Why Pay More?
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In the old days I would drink soda ("pop") during the day, but now I like water better.  Water is free and has no calories or harmful chemicals- can't beat that!  Soda seems to go for nearly $2 now in a lot of places!

Savings from Packing Lunch

Of course, the items you pack in a lunchbox aren't free, but taking your lunch and snacks with you is so much less expensive than eating out for lunch and buying snacks in the vending machines.

Eating a fast food lunch seems to get more expensive all the time, and fast food is loaded with fat and calories you don't need.  I would say I save around $10 per day by taking my lunch and all of my snacks and beverages with me.

You don't need a fancy lunch box to save money by taking your lunch.  I actually got my lunchbox on the clearance shelf at Target for less than $10 and have enjoyed it for years.

Once you get in the habit of taking your lunch, it becomes almost automatic.  If you are eating out or buying food at work, try packing your lunch to save some real money.  You can save THOUSANDS of dollars per year!

Penny Pincher Journal

Copyright © 2015 by Dr. Penny Pincher.  All Rights Reserved.  Privacy Policy

Save 50% on Coffee: Get Half Price Coffee All the Time!

Get Half Price Coffee Every Day!

Wouldn't it be great if you could get coffee for half price all the time?  I figured out a way to do just that.

No, the solution does not involve making your coffee at home- I do this already.  It is something else, and it is pretty obvious, really.

How to Get Coffee for Half Price
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This morning, I opened my drawer where I keep my coffee beans this morning to reload my grinder.  I always grind whole beans just before brewing my coffee.  I had an open bag which had more than enough to fill the grinder, and I also noticed I still had a full bag in the drawer as well.

Loading the Grinder with Whole Coffee Beans
Image Source: Dr. Penny Pincher

I wondered, "Why do I have so many coffee beans left?"  My wife picks up coffee beans for me at the grocery store.  I like to have the freshest possible beans, so I don't keep extra bags around.  But I have an extra bag with a pound of coffee beans today.  Why?

I Had Extra Coffee Beans In My Drawer- Why?
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I was drinking two 16 oz cups of coffee every morning.  I would brew a pot and pour two travel mugs to take with me in the car on work days, or I would drink the pot at home on weekends and holidays.

One time on a business trip when I was away from my coffee-making equipment, I realized that it was not practical to drink that much coffee every day.  I can make coffee myself for about 60 cents per 16 oz serving.  At a coffee shop, it costs over $2 per cup, which adds up to over $4 to meet my daily coffee needs.  Drinking a lot of coffee causes issues beyond the cost- it takes a long time to drink that much coffee, and it drives the need for frequent restroom breaks in the morning.

I decided to cut back to one 16 oz cup of coffee per day.  As I learned on the business trip, cutting coffee too fast can cause headaches!  Over a two week period, I gradually reduced my coffee consumption from two cups per day down to one cup per day.  At first, it seemed like I was missing something by only having one cup of coffee in the morning, but I quickly got used to it and it has become the new normal.

Is it obvious how to save 50% on coffee?  Drink half as much!  At first, this may sound like the punch line of a joke, but this is a reliable way to save 50% on coffee all the time.  My extra bag of coffee beans in the drawer reminded me that I am saving money on coffee beans, which is by far the biggest factor in the cost of making coffee.

If you are curious, here is an article I wrote that goes into a lot of detail on the cost to make coffee.

Get Other Things for 50% Off!

This concept of saving 50% by consuming half as much works on other things besides coffee.  Want to reduce your fast food bill by 50%?  Go out to fast food places half as much!

There are many areas of you budget where this concept will not work well- most people could not cut their utility bill of gasoline bill by 50% because they are already pretty efficient in these cost categories.  But some expenses have a lot of room to cut, and cutting an expense by half is a good goal.  A 50% reduction is significant enough to motivate you to put in some effort to achieve, and half is a simple amount that is easy to track when you have reached 50% savings.

What expenses could you cut by half just by consuming less?

Penny Pincher Journal

Copyright © 2015 by Dr. Penny Pincher.  All Rights Reserved.  Privacy Policy

Free Dish Network Plan

Free Dish Network Plan

I signed up for the free plan from Dish Network!

See photo for details on how to activate the free Dish Network plan...

The Free Plan From Dish Network

Image Source: Dr. Penny Pincher

Actually, I have been without Dish Network for almost 2 years now.  I saw this satellite dish in the trash the other day and couldn't resist taking a picture.

Yes, Dish Network does have a free plan.  The free plan involves mailing your receiver back to Dish Network.  You can throw away your dish if you like.  The down side of the free plan is that you don't get any channels.  The up side is that your bill is $0.  You can see why I went with the free plan!

I still like to watch TV once in a while.  We get Netflix, Hulu, and Amazon Prime via internet, so we can watch plenty of movies and TV shows.  I prefer streaming video because you can watch whenever it is convenient.  You can also catch up on episodes if you fall behind.  Of course these streaming video services are not free, but they add up to much less than my Dish Network bill which was over $100 per month.

We use a Roku streaming video player, and I can get some news broadcasts on streaming news channels or on Roku's news video service.  If you don't want to pay for streaming video channels, there are lots of free streaming channels available on Roku.  You can sign up for streaming channels on Roku's website after you get your Roku player set up.




I also have an indoor HDTV antenna.  I can get a few channels with this, which is useful to watch live sports.  I like to watch some college and NFL football in the fall, and sometimes I like to watch local news and weather.  Of course buying an antenna is not free, but you can get an amplified antenna for under $40 and receive high definition (HD) over the air for free with no monthly bill.



Are you sold on the free Dish Network plan yet?  The free price is hard to beat, but you may want to get some streaming video services or an indoor HDTV antenna...

Penny Pincher Journal

Copyright © 2015 by Dr. Penny Pincher.  All Rights Reserved.  Privacy Policy