Audiobook Announcement: Pinch Like You Mean It

Pinch Like You Mean It- Audiobook Launch!

Pinch Like You Mean It:  The Audiobook is out!

I am excited to announce the release of my first audiobook!  It is the audio version of Pinch Like You Mean It! 101 Ways To Save Money Now.

This book works very well as an audio book thanks to outstanding narration from Peter L. Herrick.  This guy could read a list of names out of the phone book and it would be gripping and compelling...  just imagine how great my book sounds with Pete reading it!

It took about a month to produce the audiobook version, so I hope you will check it out.  I developed this under a cool program by ACX that matches book authors with audiobook producers.  I held some auditions to find the right narrator for this book.  I think you will enjoy the results from all of the hard work that went into this project!



When I got the draft version of the audiobook, I intended to take a few minutes and listen to a few tips, but ended up listening to the entire book non-stop!  I think listening to the book makes a bigger impression than reading it.

If you have an Audible.com account, you will be able to get this audiobook for free as part of your subscription.  Enjoy!

Penny Pincher Journal

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Save Money on Car Rental: How to Avoid Getting Ripped Off!

Car Rental: There Must Be A Better Price!

Let's go to the mailbag today for a reader question about getting gouged by a car rental company:

Rental Car Savings!

"While traveling to Tulsa this week I rented a car from Budget Rental.  The car's cost for two days was $184.

That was extremely high and I refused to do it, so I continued research on the internet and found that all the cars in the middle of the week were as much as $100 a day.  So I went back to Budget and found the next day that they had a car for rent for $100 for 2 days.  I immediately rented that car.  When I got to the airport in Tulsa I went to the counter to get the car from Budget.  At that time they quoted me a price of $184.  I showed them on my phone the email confirmation that said $100.  Budget then told me that quote is from the downtown location which was 4 or 5 miles away. I asked how I was supposed to get down there and if they had a shuttle. 

The answer was simple...you have to take a cab.  Well I was a bit peeved but went outside and a cab was waiting.  I asked the cab driver how much to take me to the downtown location of the Budget Car Rental.  He told me $30. After I got up off the sidewalk, I asked if I had any alternative and he said yes you can walk. 

I thought about that, however crossing the freeways and busy highway is would have been a bit risky.  So I paid the $30, got downtown to the Budget car rental place, and asked if I had to bring it back here and have another cab ride back to the airport explaining the circumstances to the customer service person.  She said, well no we can arrange it for you can take this right straight back to the airport.  When I asked why the prices were so high, I was told by the budget representative that it was a "supply and demand situation".  

I responded to that by telling them that I thought it was a greed situation accompanied by circumstances where people had no choice.

Thank you for your time and hopefully you can get this message to Dr. Penny Pincher so he can go undercover and find out what the deal is... 

Sincerely,
An Anonymous Dr. Penny Pincher Reader"

Thank you AADPPR for sharing your interesting story and providing an idea for an article that can help save people money for car rental expenses.

Week Day vs. Weekend Rates

My first observation is that renting a car during the week can be quite expensive compared with weekends.  I think this really is related to supply and demand.  During the week, there are lots of business travelers with expense accounts who will pay top dollar for rental cars.  On weekends, most car rentals are for leisure and people are more concerned about getting a good price.

If you have a choice, try to rent a car over a weekend instead of during the week.  The prices can be something like half as much.

Try to Get the "Replacement Car" Insurance Company Rate

My next observation is that $184 or even $100 for a two day car rental seems pretty high.  The last time I rented a car, I got a Chevy Sonic for about $25 per day.  I told the car rental agent that my car was wrecked and my insurance would only cover $25 per day, so I needed something in this price range.  I didn't think you could even get a rental car for $25 per day, but they came up with one.

Car rental companies give their best deals for providing a replacement car after your car is in a wreck.  This type of car rental provides some long term rentals with relatively low mileage and is profitable business for the rental company.  Even if your car was not in a wreck, you can still try to get the rental company's best rate.  You can say that your insurance only covers $25 per day and see if they offer you something in this price range.

When I got my $25 deal, my car was actually wrecked, but it seems like this request could work even if your car is not wrecked.

For more on this strategy, see TIP 4 in confessions from a former Enterprise Car Rental Employee.

Supply and Demand vs. Greed

I liked your comment that you thought the reason for the jacked up prices was a "greed situation".  Car rental companies, like other businesses, are going to try to get as much money as they possibly can for their goods and services.

If you are renting a car in a high demand market where plenty of people are willing to pay $184, then the car rental company has no motivation to lower the price.  Why would they take $100 if they could get $184 from the next person to walk through the door?

On the other hand, if the car rental company has tons of cars just sitting there with no one renting them, they might be willing to rent one for a very good deal.  Making some money is better than making no money.  But in order to be able to drive a bargain, you need a situation where there is not a lot of demand.

So, I would always try to bargain on the price for a rental car, but if demand is high it might not work.  Your best chance to negotiate a good deal is by talking with the sales person, being friendly, and talking them into a good price by encouraging them to find something less expensive.

Bargaining on price may or may not work, but is worth a try.  The agents have a lot of flexibility in setting prices, so you might be able to keep asking for something less expensive and end up with a low price.

The Cab Ride

Paying $30 for a cab ride was expensive, but you ended up saving $54 on your car rental even after the cab fare, so this was a good move.

One idea that came to mind when reading about the cab ride is Enterprise.  Enterprise car rental will pick you up for free when you rent a car.  I wonder if you could have the Enterprise a few miles away with a lower rate drive and pick you up at a convenient Enterprise location that has a higher rate?  Maybe you could get the lower rate without paying for a cab ride...

Another idea on saving on a cab fare:  I have never tried it, but Uber and Lyft provide some very cost competitive services if you need a ride.  I would guess these services would be about half the cost of a cab ride, but you might have to wait a bit compared with taking the cab that is already there.

Car Rental Add-on Expenses

Next time I need to rent a car, I'll go undercover like I did in this investigation of Rent-to-Own stores and see what I can learn about how rental car companies extract money from people.  Here are some car rental company tricks to watch out for:

• Supplemental Insurance:  Your existing car insurance likely covers you.  Paying for extra insurance is very profitable for the car rental company.
• GPS fee: You can use your smartphone instead of paying a few dollars a day extra for a GPS in your rental car.  Or use a paper map.
• Satellite radio fee:  I hear that car rental companies are charging a few dollars a day extra for XM or Sirius satellite radio, even if you didn't know your car had satellite radio and didn't use it!
• Gas fee:  If you turn your rental car in without filling up the gas tank, you can get hit with fees and pay extra money for the car rental company to put gas in the car.  Try to fill it up yourself on your way to the rental car lot when you turn the car in.

Overall, it sounds like you saved some money by shopping around and taking a cab to get a much lower rate a few miles away.  Nice work!

Best Wishes,
Dr. Penny Pincher

Penny Pincher Journal

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Make Your Own Cereal at Home- Cheap!

Cereal Is Too Expensive- Make Your Own!

I have complained here on my blog about how expensive cereal is compared with the cost of the ingredients of cereal.  If you do the calculations, cereal has an incredible mark-up.  I didn't think there was much I could do about this, other than choose the most cost effective brands of cereal available.

Then one day, I noticed that my son was making his own cereal, and it is much healthier than the expensive cereal you can buy at the store.

The alternative cereal trend at my house started when my son discovered that some caramel corn that we bought on clearance at the grocery store made great cereal.  Just pour some in a bowl and add milk.  It tastes like Corn Pops, only a little fluffier.

Of course, it is really cheap and easy to make fresh popcorn at home.  We decided to skip the caramel part and just put some popcorn in a bowl with milk.  If you like, you can put some sugar on top to make it taste more like store-bought cereal.

Photo credit:  Heather Lion (CC-SA-30)

Popcorn Revisited

The popcorn we are using for cereal is not like movie theater popcorn.  We are skipping the salt and butter.  Fresh popcorn has a nice flavor even if you don't add anything to it.  We use a little bit of Crisco vegetable oil (it's soy bean oil) for popping.  Peanut oil would also work well.

Fortunately I have my own movie theater popcorn machine that we got as a family Christmas gift one year for about $150.  We have made movie theater style popcorn with melted butter for movie night for years.  If you don't have a popcorn popper like this, you can use an air popper or even pop popcorn in a pan on the stovetop.  Using those microwave popcorn bags wouldn't really work for cereal since that stuff is so salty and oily.

Great Northern Popcorn Machine- Movie Theater Style

It may sound weird to eat popcorn as a meal, but this idea has been around for awhile.  According to Alton Brown on his episode of Good Eats about popcorn, native Americans in the southwest popped popcorn by heating up sand with popcorn kernels in it over a fire.  The anthropologist on the show thought that the ancient people made a gruel by adding water to the popped corn and mashing it up.  Popping the corn allowed the nutrients to be obtained from the hard dense kernels.

Now, fast forward a few thousand years.  One of the first ideas for commercial breakfast cereal in the United States was to ship boxes of pre-popped popcorn. However the Kelloggs brothers decided to go with corn flakes instead since they were not confident that pre-popped popcorn would sell very well.

Popcorn is a whole grain with lots of fiber, and is really cheap to make.  If you don't add salt and butter to it, it is a healthy snack and even a healthy meal in the form of homemade breakfast cereal.  If make your own cereal, you know exactly what artificial colors and chemicals are in it- none!

Penny Pincher Journal

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It's Time to Make Some Extra Money Publishing Articles...

Make Extra Money Publishing Articles

It's Time to Make Some Extra Money!
Dr. Penny Pincher on the cover of Time magazine

OK, so this Time magazine cover featuring my picture is obviously fake, but I am excited that I got an article published on Time.com today!  The article is about 21 times you can spend money to save money.  You can read it here on Time.com.

If you read my newsletter, you know that I am planning on making some extra income this year in addition to pinching pennies as usual.

Last summer I decided to move beyond posting articles on my blog and see if I could get paid to publish articles on other sites.

Having my own blog is great.  Here are some things I like about publishing articles myself on my blog or on HubPages:

1) I can write about anything on my blog
Sometimes I write about my dog.  One time I wrote a fictionalized account of an interaction with my editor just for fun.  I started a blog about coffee because I like coffee.  One time, I even thought of an article topic just so I could show a giant picture of my face on a fake Time magazine cover!

There is no adult supervision at all, I can write whatever I want and it gets published immediately.

2) I own the articles and can make passive income forever
I like the idea of owning something that has value.  When I write articles and publish them myself on my blog, I retain all rights to the articles.  I can make money for years from advertising.

3) No schedule constraints or deadlines
Sometimes I post new articles on my blog every day, or sometimes only a couple times per month.  It is up to me, and no one seems to get upset if I don't post for awhile.

4) Easy money
Who doesn't like making some extra money for doing something really easy?  From my family's perspective, it probably doesn't look like I am working very hard.  They see my relaxing in my chair, looking out at the lake and messing around on my computer.  Not a bad way to work if you ask me.

However there are some limitations to publishing on my own blog, and this is why I was open to trying something new and publishing articles on other sites:

1) I don't have enough readers... yet...
Thousands of people read my blog, and that results in some nice income.  But there are sites around that have MILLIONS of readers.  I took some advice from Jon Morrow to go where the audience is gathered instead of waiting for them to find me.

Publishing on an established site can be a quick way to reach a large audience.

2) It is nice to get an instant paycheck
Selling an article gets you money up front, right away instead of waiting for money to come in over a long period of time from advertising revenue.  It is not unusual for a blog to take many months to make the first few cents.  Selling articles can bring in extra money much faster than that.

3) Build name recognition
Being published on popular sites that people know and trust helps build credibility with readers.  You can check out my About Penny Pincher Journal page to see some of the places my articles have been published.  Some of my articles are syndicated, so you can find them on a lot of popular sites around the internet.

4) Become a better writer
I have learned a lot working with editors as they suggest topics and work with me to refine my ideas for articles.  I l review my articles after they are published to see what edits the professionals made to tune them up.

The "Write" Way to Start Publishing Articles to Make Extra Money

You can find lots of advice around the internet on how to start a blog to make money.  Most of this advice comes with links to sign up for web hosting and domain registration and courses, which all cost money.

I ignored most of the advice and have gone with 100% free web hosting from Google on blogspot.com and use a free domain name as well.  I might be able to make more revenue from my blogs if I were willing to spend more, but it sure is nice to have no bills to worry about paying for hosting my content.

Publishing articles at HubPages is also free in the sense that you do not have to pay them, although they take a 40% cut of your advertising earnings.  I think this is fair since there are expenses involved with running servers and promoting the site.  Here's how to get started publishing articles on HubPages for free.

After starting my blog, I have also published a few books.  It is fun to get a check in the mail once in a while, and my free book generates interest in my blog.  Here is an article I wrote on making money by publishing ebooks:  Can You Get Rich Writing eBooks?

Selling articles to other sites to publish is probably the fastest way to make money, but you will likely need to have some published articles as a portfolio in order to get hired to write articles.  This is a catch-22.  You can work around this problem by starting a blog, publishing some interesting articles, and then approaching other sites about writing for them.

If you enjoy writing and have some patience, selling articles is a great way to do something interesting and make some extra money.

Is it time for you to start writing articles and finding paychecks in your mailbox?  Sign up for my newsletter- sometimes I share details about my writing projects and making money with my subscribers.

Penny Pincher Journal

Copyright © 2016 by Dr. Penny Pincher.  All Rights Reserved.  Privacy Policy

Cheap Ways to Deal with Peeling Paint on an Old House

Peeling Paint, Old Siding, What To Do?

Is There A Better Way?

My latest article on Wise Bread triggered a great question from a reader:

"Dr Penny Pincher,

Read your article on the hidden costs of buying an old house.  Very informative, practical, and interesting.  Anyone buying an older house should consider all of the potential costs you mention when buying an older property.

We live in an older home and have for some time.  One of the potential problems we are considering is the painting and upkeep on the outside of the house.  Our home has the original cedar shake siding and requires maintenance every year in addition to periodic painting of the entire house which is two stories. We are reaching an age where using a ladder probably is not a good idea. 

Do you have suggestions for an inexpensive way to maintain the house without the expense of siding??

Thank you,

A Penny Pincher Follower"


Thank you PPF for your question!

A few years ago while painting my 2+ story house, I realized that I have a mild sensitivity to heights.  I had nightmares about falling off of a ladder, and my palms were sweating and my hands shaking when I got much above one story high.  I can understand why you don't want to go up on a ladder to paint!

Unfortunately, going up on a ladder is probably the least expensive way to deal with old siding.  It seems like old wood gets moisture in it and has trouble keeping a good coat of paint more than a few years.  Even a really great paint job might only last a few years.

Here are things you can do to deal with peeling paint on wood siding, in order of cost:

1.  Paint the house yourself
This may cost a few hundred dollars for the paint.  You can reuse paint brushes and ladders for many years.  The drawbacks of painting yourself are that you have to go up on a ladder and spend a lot of time scraping off the peeling paint and repainting.

2.  Hire someone to paint your house
This may cost several hundred to a couple thousand dollars depending on the size of your house and who you hire.  As with hiring someone to do anything, you have to worry about the quality of the work and deal with having strangers around on your property.

3.  Move to a newer house with vinyl siding
Most newer houses have vinyl siding or other zero maintenance siding.  I ended up moving to a newer house after I painted my old house.  The cost to move varies with how much stuff you have and whether you need to hire movers.  My last move cost about $2,000.  It may sound extreme, but moving to a newer house will get you out of painting...

4.  Replace old wood siding with zero maintenance siding
Before I painted my old house, I looked at going over the old wood siding with new vinyl siding.  The estimates to install vinyl siding were in the range of about $30,000 to $40,000.  This was a large house with lots of windows, so these numbers may be higher than for a typical house.  In any case, replacing siding is a major expense.

I hope one of these options works for you.  Go with option 2, 3, or 4 to avoid going up on a ladder.  Best of luck!

Penny Pincher Journal

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Oil Change Interval: Miles and Time

How Often Do You Need to Change Your Oil?

Changing the oil regularly is important to keep your car running well.  Clean, fresh oil does a good job of reducing friction in your engine and protecting it from wear and tear.  Over time, your oil gets dirty and it loses its ability to protect your engine.

But how often do you really need to change the oil in your car?  This topic has been in the news a lot over the years.  The old guideline was to change your oil ever 3,000 miles or 3 months- which ever came first.  Some of the windshield reminder stickers given out by service shops still have this outdated information.

Most modern cars call for oil changes every 5,000 to 10,000 miles, depending on driving conditions.  Short trips that don't get the car fully warmed up are harder on oil.

News organizations including The New York Times, Time Magazine, and Scientific American have all weighed in on this question- and all suggest that a 3,000 mile oil change is no longer needed due to advances in engine design and oil chemistry.

I'll share the question from a reader that inspired this article, and then my answer:

"We bought a Toyota RAV4 on October 20.  It was traded in a few days before that and they did some maintenance stuff on it including changing the oil.  

The sticker on the windshield says they changed it on October 15th and that we should change it again on Jan 15th which I haven't done.  We have driven it 911 miles since Oct. 15th. (We don't drive much any more).  The manual for the car says to change the oil every 5k miles. If we did that we wouldn't change the oil for over a year.

Suggestion on when to change?

Also change at the dealer or the Firestone store or Walmart? The dealer is more expensive..."

Thank you for your question!  Although changing the oil in a car is relatively inexpensive- around $30 for a full service oil change- you don't want to waste time and money changing the oil too often.  Plus changing oil more frequently than is needed results in more dirty oil that has to be disposed of somewhere.

Oil Change Interval- Mileage

I pulled up the recommended service interval for a Toyota Rav4 that I found in the Warranty and Maintenance Guide.  The recommended oil change interval is 5,000 miles or 6 months- whichever comes first.

So if the oil was last changed in October, your oil change is good until April if you have driven less than 5,000 miles.  Unless you go on a major spring break trip, you should be well under 5,000 miles on your current oil change by the time the 6 months is up in April.

Oil Change Interval- Time

Since you have only driven 911 miles, you might be able to run longer than 6 months without changing the oil.  Some other websites I checked indicated that oil should be good for up to 12 months.  Over time, oil can become corrosive due to increased acidity and damage engine parts.  Short trips where you engine is not fully warmed up are especially hard on the oil.

I would probably stay with the 5,000 mile/6 month recommendation from the maintenance log for the RAV4.  In general, I would suggest checking and follow the oil change interval recommendations from your vehicle's manufacturer.

Where to Get Your Oil Changed?

Now for the question of where to get your oil changed.  I have found that dealer service departments tend to be more expensive.  Even though the dealer shops usually have free donuts, I take my car to Midas for routine maintenance.  I have received great service there and I use coupons to save at Midas.  Other similar shops include Tuffy, Jiffy Lube, Walmart and Firestone as you mentioned.

Best of luck!

Penny Pincher Journal

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Home Disimprovement: Downgrade and Save Money

For Cheapskates Only...

Home Disimprovement Can Save Money

When I bought my house a couple years ago, it had two doorbell buttons near the front door.  The funny thing was that neither one worked.  Pushing the buttons did not make the doorbell ring.

Here's what I think happened: the original doorbell button installed when the house was new in 1981 stopped working at some point, so someone installed a second doorbell button.  The replacement was a wireless doorbell button, and was installed right next to the first one.

I didn't pay much attention to the doorbell button situation until Halloween.  Trick-or-Treaters were pushing the doorbell buttons, but nothing was happening and we didn't know anyone was there waiting outside.  Visitors did not know to knock since there were two doorbell buttons.  It was rather confusing.

So what to do?  I thought about putting up a sign that says "Please knock, doorbells don't work".  I decided against this because it would look sort of tacky to post a sign explaining that something doesn't work.  Plus, I thought the sign would get wet and fade over time and would require periodic replacement.  So I needed to figure out another solution to the doorbell situation.

Maybe I should fix the doorbell button?  Perhaps add a third doorbell button next to the existing two broken ones?  But then I would probably need to add a sign to indicate which button works.  Plus I would need to find and buy a doorbell button, install it and get it working.  This sounded like a lot of trouble.  I needed an easier solution, and I found it.

I decided to do a downgrade and save some money.  My dogs usually bark like maniacs whenever someone even thinks of approaching the house.  It would be hard to hear a doorbell ring over the barking of my dogs anyway.  Why not just remove the broken doorbell buttons?  This wouldn't cost anything, and then it would be obvious to visitors that they should knock without the need for signage to explain which doorbell button to press.

I disconnected the doorbell ringer from the transformer and removed both broken doorbell buttons next to the front door.  I used some caulk that matches the siding to fill in the hole.  Problem solved.  Cost: $0.  Time: about 10 minutes.

After "downgrade" I no longer have a doorbell...

In this case, I am better off with zero doorbell buttons than with three doorbell buttons.  Sometimes a downgrade is better than an upgrade, and you can save some money as well.

Penny Pincher Journal

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Can You Really Buy Hope for $2.99?

Buy hope for $2.99?

Can You Buy Hope for $2.99?

Today I went shopping with my wife at the consignment shop.  She wanted to check out some used furniture and I wanted to check my balance to see if I had money waiting for me.

We found a nice old dresser for the bedroom, but we did not buy it.  It was a solid old unit, made with real wood and dovetail joints.  But I decided to get rid of some of my clothes that wouldn’t fit in the closet instead of buying a dresser for more storage.  This seemed like a good way to save some money and avoid buying yet another thing.

I picked up $3.88 for some old clothes that I sold.  Considering the decision to get rid of some clothes, I can look forward to more payouts like this.  I like shopping at a store where I can walk out with more money than when I walked in!

On the way out of the store, I saw something for sale at the check-out.  There were some impulse items for sale with a sign that read:

  “Hope $2.99”.

 I was intrigued.  For one thing, I had $3.88 in my wallet, so I could actually afford to buy what they were selling.  But how can you sell hope for $2.99?

I moved in closer to see what was in the packages that you could get for $2.99.  I was disappointed to see that it was a package of rope.  The sign actually said “Rope $2.99”.

Is There Still Hope?

Even though hope was not for sale as I had initially thought, I began to wonder... could you really buy hope for $2.99?

For this exercise, let’s assume that if you have some money that you have some hope for the future.  If you were completely broke and started saving $2.99 every day, would this be enough to provide hope for a stable financial future?

Saving $2.99 per day adds up to about $90 per month.  First, let’s look at how this would grow in a savings account.

If you put away $2.99 per day (round to $90 per month) you would have:
$5,400 after 5 years
$10,800 after 10 years
$21,600 after 20 years
$32,400 after 30 years

You would do a little better in a bank account at 0.85% interest:
$5,514 after 5 years
$11,268 after 10 years
$23,536 after 20 years
$36,891 after 30 years

If you really want to buy some hope for $2.99, let's try to find a better rate of return.

What if you invest the money in the stock market instead of a bank account?  The stock market can go up or it can go down.  Over the long term, the historical rate of return is around 8%.

Here's how your daily contribution of $2.99 would accumulate with a 8% rate of return:
$6,613 after 5 years
$16,465 after 10 years
$53,011 after 20 years
$134,132 after 30 years

You can check out these calculations yourself with my Saving Calculator.  Just put in a $0 starting investment amount, set the monthly investment amount to $90, and set the interest rate for your investment scenario.

It is starting to look like you can buy hope for $2.99 after all.  If you wanted to save up a million dollars assuming an 8% average return, it would take just over 54 years.

If you start buying hope soon enough, you could end up with some real money.

Not to dash your hopes, but there are some things we have not considered in the simple calculations above.  Inflation over time tends to reduce purchasing power of your money in the future, so what looks like a lot of money in these calculations may not buy as much as you would think in the future.

Also, you will have to deal with taxes.  One way to avoid paying taxes on a retirement investment is to contribute to a Roth IRA.  You do not have to pay capital gains taxes if you follow rules that apply to withdrawals.

Buying hope for $2.99 seems like a pretty good deal.  The best time to start buying hope was 54 years ago.  The second best time to start is right now.

Penny Pincher Journal

Copyright © 2016 by Dr. Penny Pincher.  All Rights Reserved.  Privacy Policy

Starbucks vs a Free Water Fountain

Free Water vs $2 Coffee, Guess Which Wins?

Sometimes a picture really is worth a thousand words.  Let's start with the picture.  Can you see why I thought this scene was interesting?

What's Wrong with This Picture?

When I saw this, I thought it was shocking and I immediately reached for the cell phone in my pocket to take a picture.  What is wrong with this picture?  I added some notes on the version below to make the problem clear.

Why Are People Lined Up To Pay Instead of Getting the Free Drink?

I thought it was surprising that people were lined up waiting to pay for drinks at Starbucks when free water fountains were clearly available only a few feet away- and with no waiting.

It is not surprising to me that some folks would want to get a treat such as a $2 cup of coffee, $3 fancy coffee drink, or $3 juice drink.  I was surprised by how much demand there was for these expensive drinks when there was free water right there.

I watched this scene for a few minutes.  More people kept joining the line for the expensive drinks, but no one used the water fountain.  Why?

Why were so many people paying for expensive drinks when there was free water right there?

One reason is that coffee is "mildly habit forming". If you read my blog much, you know that I am a coffee connoisseur and have even written a book about making great coffee for almost nothing.  I understand that people need coffee in a way that they don't need water.  I used to buy coffee at a coffee shop every day, but now I make great coffee at home for about 60 cents instead of paying $2 at a coffee shop.

Not everyone was buying coffee, though.  They were also buying fruit juice drinks and... bottled water!

I think people are in the habit of buying a refreshment at Starbucks and don't even consider skipping it or getting free water at the water fountain.  Once a habit gets established, it is hard to break.  Routine expenses are not really noticed anymore.  I call this "The Starbucks Effect".

I still find instances of The Starbucks Effect as I look at my own spending and try to cut back on unnecessary expenses.

Does it really hurt anything to buy a $2 drink at Starbucks?  Not if that is the most important thing you want to do with your money, but I know I have more important things I would rather do with my money.  A few dollars here and there quickly adds up to real money- money you could use to get out of debt and be able to afford things that are much more important to your than drinks at Starbucks.

The lesson I take from this strange scene at Starbucks is to look for that "free water fountain" in different areas of spending to find opportunities to save money.

• Are you paying for cable TV or satellite when you could get free TV over the air or Netflix for much less?
• Are you buying fast food for lunch every day when you could take lunch for a fraction of the cost?
• Are you paying a lot to drive a new car when an older car would be just as useful and much less expensive?

And finally, are you buying expensive drinks when free water would be cheaper and healthier?

If you want many, many more ways to save money, check out my free ebook with 101 tips to save money!

Penny Pincher Journal

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

When Using a Credit Card is Good...

Did You Just Say To Use Credit Cards More?!

Sometimes You Can Save Money By Using a Credit Card!

After my second book came out about a year ago, some frugal readers were not impressed with my advice to use a credit card that has a good rewards program for purchases.  The advice in question is contained in Tip 15 of my free eBook: Pinch Like You Mean It! 101 Ways To Save Money Now.

My logic is that if you are going to make a purchase, you might as well get as many points as you can and effectively reduce the cost of your purchase.  My rewards card gives points that I can use to buy anything on amazon.com.  I use my points to get things for free that I would otherwise pay for, saving me hundreds of dollars every year.

Another benefit is that using a credit card is more secure than using a debit card or other forms of payment in case of fraud or payment dispute.  I have been able to have charges removed from my bill a couple of times, saving well over $100.

The point that some of my disappointed readers made can be summed up as:
 "Credit cards are bad.  It is stupid to give advice suggesting to using credit cards."


I think credit cards are bad if you use them to buy things you don't need or to spend more than you can afford.  However, I stick with the conclusion from my book- you can come out ahead using a credit card with a good rewards program if you stay within your budget and don't run up a balance.

I use a Citibank Visa card.  There are other good choices available.  If you are paying your balance off every month, then you don't need to worry about the interest rate on your credit card.

Another way to save money using credit cards is using a store credit card for a cash discount.  I get 5% off of every purchase at Target and Lowe's by using my store credit cards.

I bought a refrigerator at Lowe's with my store credit card and the 5% discount amounted to some big savings from just this one purchase!

Even smaller purchases of groceries and other items at Target add up over time.  Why not take 5% off if it doesn't cost anything.  I always pay off my balance on these cards, so I have not paid any interest or fees.

If you can pay off your balance, why not take advantage of credit card rewards and discounts on purchases?  The credit card company is betting that by offering perks that they can get you to buy more things and to pay interest on a credit card balance.

Prove them wrong and take their money!

Penny Pincher Journal

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

Best Kind of Christmas Tree?

What Kind of Christmas Tree is Best?

Best Christmas Tree?

There are many Christmas tree options- you can get a "real" Christmas tree, an artificial Christmas tree, and even a living Christmas tree.  I have done all of these.  Today I will share the pros and cons of each.

Real Christmas Trees

A "real" Christmas tree is a living evergreen tree that is cut.  You bring this tree home, place it in a Christmas tree stand with water, and dispose of it after the Christmas season.  A real Christmas tree tends to dry out, so you need to make sure to keep water in the stand and dispose of it before it dries out too much.  A dry Christmas tree is very flammable, and you don't want something like this in your house.

An advantage of a real Christmas tree is that it smells great.  You get a fresh pine smell.  Related to this is a downside- you'll have pine needles to sweep up or vacuum up as they fall from the tree.

The logistics of dealing with a real Christmas tree are a drawback.  You need to drive to a tree farm or store parking lot where Christmas trees are sold, tie it to the roof of your car, and drive it home.  Almost all real Christmas trees are too tall to fit inside a vehicle.  When you get the tree home, you need to remove it from the roof of your car, use a saw to cut an inch or so off of the trunk so it will absorb more water, and bring it inside.  Next, you set up your Christmas tree stand and work on getting the tree level.  The tree often looks fine when you are lying on the floor tightening the bolts that hold it in the tree stand, but then it looks crooked when you step back and look at it.  It can take a few tries to get it screwed into the stand level.  Next you carefully add water to the stand and go about decorating the tree.

One of the pros of getting a real Christmas tree is that it is fun to go with your family to the Christmas tree lot, pick out a tree, and bring it home.  This is much more of a memorable holiday event than hauling the artificial tree box down from the attic.

Cost is a negative for a real Christmas tree.  Real Christmas trees cost between $40 to $100 each, depending on the species and size.  This cost adds up year after year.  We spent hundreds of dollars on real Christmas trees during the years that we went with that option.

Pro:  Looks nice, smells nice, can be fun to pick out.

Con: Most expensive Christmas tree option, need to haul it home, drops needles, can be difficult to mount in tree stand, can be fire hazard if it dries out

Artificial Christmas Trees

The next option is getting an artificial Christmas tree.  One drawback of artificial Christmas trees is that assembly is required.  Some artificial trees have sections or branches that need to be installed in the right places to build the tree.  I don't think assembly is a big drawback since you are going to spend a lot of time decorating the tree anyway.

Some artificial Christmas trees come "lighted" with pre-installed Christmas lights which can be a big time saver.

You will also need to have a place to store an artificial tree year round, and you'll need to move your artificial tree every time you move.

Another disadvantage is that cheaper artificial Christmas trees look really fake- they are clearly made with plastic needles and no one is going to think it is a real tree.

An advantage for artificial Christmas trees is that they don't have good sides and bad sides like real trees have.  When I used real Christmas trees, we would need to look it over and decide which side should face out.  With an artificial Christmas tree it doesn't matter which side you are facing since the symmetry is perfect.

The initial cost of an artificial Christmas tree is typically higher than the same size of real Christmas tree, but since you can use an artificial Christmas tree for many years, this cost is offset in a few years.  An artificial Christmas tree is the most cost effective type of Christmas tree.

One reader reported that they bought an artificial Christmas tree over 30 years ago for $6 and are still using it!  You can save a lot of money over the years if you keep the same artificial Christmas tree.

Pro:  Cheapest Christmas tree option, lasts many years

Con:  Takes space to store, can look fake, requires assembly

Live Christmas Trees

One year we decided to try a live Christmas tree.  We got a small tree that came in a pot with its roots, and set it on a small table in our living room.  The live tree was only about 3 feet high, so we placed presents under the table.  We were able to put a few ornaments on this small tree.

An advantage of a live tree is that you can plant it in the spring.  If you want trees anyway, this can be a good way to collect evergreen trees to plant.

A downside of using a real tree is that the tree will be small compared to an artificial or cut Christmas tree.  I was willing to try a 3 foot tree instead of a 7 foot tree for similar cost.  Another consideration is that it can be hard to find live trees for sale- few stores offer living Christmas trees for sale.

Pro: Get a real tree without cutting one down, get a live tree to plant in your yard

Con: Hard to find for sale, you'll get a much smaller tree for the money

What Kind of Christmas Tree is Best?

• If cost is an important factor for you, get an artificial Christmas tree and use it for many years.  The cost per year is clearly least for an artificial Christmas tree.
• If you want to plant trees in your yard and can accept a smaller tree, try a live tree.  I liked the idea of not cutting down a tree for Christmas.
• If you enjoy the experience of picking out and bringing home a Christmas tree, then go with a real Christmas tree.  The cost for the tree is more, but you are getting more than the tree- you are getting the experience and memories as well.

Penny Pincher Journal

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

6 Ways to Save Real Money on Coffee

Beyond the Latte Factor... 6 Ways to Save Real Money on Coffee

6 Ways to Save Money on Coffee

You have probably heard of the latte factor- this is an illustration of the concept that a small amount of savings or investment can add up over time.  A common example is investing or saving $3 dollars every day instead of buying a latte, thus the term "latte factor".

I think the latte factor is a powerful concept, and I think there are several ways you can save money on coffee and use that money to pay off debt and build your wealth over time.

1. Order simple coffee instead of fancy coffee drinks.  Save the lattes for a treat instead of every day.  This literally removes the latte factor from your budget, saving about $1.50 per day which adds up to over $500 per year.  Plus you can leave a lot of extra calories and fat out of your coffee.  

The coffee in the photo above cost me $3.14 at Starbucks.  Why did Dr. Penny Pincher buy a $3 coffee at Starbucks?  Here's the story behind this purchase...

2. Make great coffee at home.  You can make great coffee at home from fresh ground whole coffee beans for 60 cents per 16 oz. mug.  Coffee at a coffee shop costs about $2 per cup, so you can save about $500 per year by making your own coffee at home instead of buying it at a coffee shop.  If you drink two cups of coffee per day, this adds up to $1,000 per year in savings.

3. Cut back to one cup of coffee per day.  I used to drink two cups of coffee per day at a coffee shop.  Ouch!  Since then, I have started making coffee at home, and I have cut back to one cup of coffee per day.  

If you are drinking two cups of coffee every day and cut back to one, you'll save over $700 per year if you get coffee at a shop or over $200 per year if you make your coffee at home.  

When I cut back to one cup per day, I gradually reduced the amount of caffeine I got by mixing decaf coffee beans with my regular beans.  The key is to gradually reduce your caffeine consumption over a period of time to avoid caffeine headaches.  Here are details on how to painlessly cut back on how much coffee you drink.

4. Find cheaper coffee places.  McDonald's has coffee for $1.39.  This doesn't sound that much cheaper than $2 or more for coffee at Starbucks, but this adds up to a savings of around $150 per year if you drink coffee every day.

5. Go with a smaller size.  Generally, you can order small, medium, and large coffee.  People tend to order the largest size since it is the best value- for only 50 cents more, you can get nearly twice as much coffee.  But if you can train yourself to order the smallest size, you can save over $180 per year.

6. Don't buy scones, muffins, and other stuff at the coffee shop.  Coffee is expensive at coffee shop, but the snacks are even more expensive.  Just stick with coffee and save hundreds each year.

Penny Pincher Journal

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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

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