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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Used EVO CX Exercise Bike Review

Used EVO CX Exercise Bike Review

Used EVO CX Exercise Bike

I am always looking out for cheap used exercise equipment that I can use to stay in shape.  I have been looking for an exercise bike for a year or so since my old 20 year old Schwinn Airdyne broke.  I wanted something much more sturdy and capable of providing a quick, intense workout.

Last week, I found what I was looking for- and more- at the 2nd Wind used exercise equipment store.


The store obtained some used professional grade exercise bikes from a fitness center and was offering them at a substantial discount.  The EVO CX can be ridden like a standard exercise bike, but it has a neat trick.  It has a sway mechanism that allows you to stand up and work your core.  This simulates the motion of standing up and riding a bike up a steep hill.  What a workout!  I feel like I could leap over a small building after doing this a few times...

This sturdy piece of gear is just what I needed.  It is a heavy item, I would guess it weighs around 100 pounds.  I had my teenage son help carry it to my exercise room upstairs.  The base does have wheels to make it easy to position in your workout room.

The EVO CX is quickly and easily adjustable since it is designed for heavy use by people of different shapes and sizes in a fitness club.  It has a nice handle bar assembly that holds 2 water bottles plus your cell phone.  The hand rest allows a lot of different hand and arm positions while riding.

This is a simple "spinner" exercise bike.  You don't need to plug it in, and it does not have automatic exercise programs.  There is a red resistance knob that you can turn to increase or decrease the resistance.  Pushing the button stops the pedals from spinning when you are ready to stop.

EVO CX Professional Grade Exercise Bike

This bike includes a built-in computer to track your time, distance, and heart rate, although I did not get the wireless heart rate strap with my used model.

Really, this is two exercise machines in one.  You can ride this like a standard exercise bike, or you can set the switch to allow sway and stand up.  The exercise you get by standing up and swaying is more like running or sprinting.  I am in pretty good shape from riding my real bike up hills all summer, but this exercise bike is able to challenge me with a good workout that takes only a few minutes.

If you are looking for a really solid exercise bike to add a piece to your workout, check out the EVO CX.



These are pretty expensive new, check out used EVO CX on eBay:

EVO CX on eBay

Penny Pincher Journal

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Straw Bale Garden Harvest

Harvesting Vegetables from My Straw Bale Garden

 One Day's Harvest From My Straw Bale Garden 

I have started to write this "Straw Bale Garden Harvest" post a couple times now, but the garden just keeps on going.  We had a beefsteak tomato tonight with dinner and still get great cherry tomatoes every day.  Even thought the garden is still producing, I will go ahead and summarize the harvest.

If you want to learn all about straw bale gardens, you can learn everything from planning through harvest:

• Starting a straw bale garden
• Conditioning the straw bales
• Straw bale garden timeline
• Does a straw bale garden work?
• Straw bale garden harvest (this article)

Watermelon

Watermelon from Straw Bale Garden

Last week, I had one of the best watermelons I have ever had.  Yes, I grew it in a straw bale!  Of all the things I planted in straw bales, I was most skeptical of the chances of growing good watermelons.  I usually have a hard time growing good watermelons in a regular garden, and thought it would be even harder planting a watermelon in a straw bale.  I don't know if it was the weather, or the soaker hose that I used to
provide regular watering, but the watermelon did well and we got 3 big ones.

Cantaloupe

Cantaloupe from Straw Bale Garden

The cantaloupes produced small fruit, and I am waiting a bit longer to try one.  Since they are small, I hope they will grow a bit more.

String Beans

String Beans from Straw Bale Garden

We had string beans pretty much all summer long.  Having the beans raised up on top of straw bales made them easy to harvest.

Tomatoes

We planted some beefsteak tomatoes that were started from seed, but they just didn't do very well.  From a single growing season, I can't tell if they just didn't do well in the straw bales, or if the weather in general just didn't work very well.  We got a few tomatoes, but far less than we hoped.

Cherry Tomatoes

Cherry Tomatoes from Straw Bale Garden

I would say the cherry tomatoes were our best crop.  They started producing and just wouldn't stop.  I even had plenty of extra cherry tomatoes to share at work.

Broccoli

The broccoli grew very well and produced a lot of broccoli, but I didn't eat much of it.  We had tons of white cabbage butterflies and so we had lots of worms in the broccoli.  I could have sprayed it, but I didn't want to mess around with chemicals.  The butterflies got it this year.

Cauliflower

Same story with the cauliflower- it grew well, but there were a lot of worms.  The problem with pests had nothing to do with the straw bales, we just have a lot of butterflies around.  Next year, I might try putting tents over the cauliflower and broccoli to keep the butterflies off, or maybe use some Sevin garden dust to keep the pests down.

Lettuce and Spinach

The lettuce and spinach grew very well in the straw bales, we planted both of these as seeds right in the bales and covered the seeds with a bit of soil.  I almost forgot about these crops- we finished harvesting these in early spring.  We had fresh salad a number of times.

Jalapeno Peppers

Jalapeno Peppers from Straw Bale Garden

We got lots of jalapeno peppers and they were really, really spicy!

Bell Peppers

We harvested 8 or 10 peppers, which was OK for the small number of pepper plants we put out.  The peppers were on the small side, but this may have been due to the variety of pepper.

Onions

I would say onions were the only crop that failed.  The onions didn't grow very will in straw bales.  I planted about 30 onions from onion sets and we didn't get any at all.  I think I did not water them enough.  As I have mentioned, it takes regular watering to have success with a straw bale garden since the straw bales don't seem to hold water as well as the ground.

Potatoes

The potato plants grew very well in straw bales, and I look forward to a very easy harvest in a few weeks.  I'll simply pull the straw bale apart and scoop up the potatoes- this should be much easier than digging into the ground looking for the potatoes.  I like to harvest potatoes just before Thanksgiving and will probably use them in Thanksgiving dinner.

Cucumbers

I almost forgot about the cucumbers since we pulled the plants last week.  They produced tons on cucumbers all summer long.

My Straw Bale Garden at Harvest

Thanks for following the straw bale garden this year!  Look for more gardening adventures next spring...

Penny Pincher Journal

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How AdBlock Could Break the Internet

Will AdBlock Break the Internet?

A few days ago, Apple announced that its new iPhone will support AdBlock software.  Apple is always making innovative upgrades to iPhones, so something as simple as supporting AdBlock may not sound like such a big deal.  But this could break the Internet.

If you are not familiar with AdBlock, it is software you can install so that ads do not appear when you look at websites.  I first saw AdBlock in action a few years ago when I tried to look at one of my websites on my wife's computer.  None of the ads on my page were displayed and I thought my ads were broken. I mentioned this to my wife and she explained that she runs AdBlock software on her Mac desktop.

Even back then, I realized it would be a big problem if too many people started using AdBlock.

"What's the problem?" you say.  There is all this free stuff on the Internet that you want to look at, but the ads are annoying.  Why not just block the ads and make it easier to surf the net?  The reason that all kinds of free stuff is available to read on the Internet is that the people publishing it can make money from the ads.  If there is no money to be made, people will stop putting free content on the Internet.  This includes bloggers like me on up through sites like the New York Times.

Apple's announcement raises the level of concern since this brings AdBlock to the mobile phone platform, which is a growth area for Internet advertising.  Also, featuring AdBlock as an innovative feature will encourage more users on desktop and mobile android platforms to adopt AdBlock.

As someone who likes to get free stuff, I am concerned.  If Internet ads dry up, there will be less free stuff that I can access as publishers like bloggers and news sites reduce the amount of free material they publish.

Perhaps some of the best content from the large publishers will move behind a pay wall.  But I won't pay.  As I have cut back my budget, I stopped getting a newspaper and also stopped getting cable TV.  Free stuff on the Internet is a major source of news and entertainment for me, and I don't want to see the quality content and variety go away.

Of course, I am also a publisher of free content on the Internet and revenue from ads provides a motivation to keep publishing new material.

What Could Be More Annoying Than Ads?

It will be interesting to see how this will unfold.  I agree that some Internet ads are pretty annoying, especially the pop-over ads and video ads, but alternate ways to pay for Internet content seem even more annoying.

• Imagine having to subscribe and log in to each your favorite sites, not to mention paying a monthly subscription.  
• Imagine having to type in your credit card number and pay a small amount, even 10 cents, to read articles you find as you surf the Internet.  
• Imagine having to launch a separate app to view each of your favorite sites.  Using custom apps from each publisher is a way to get around AdBlock that works on browsers.
• Imagine if the distinction between content and ads is blurred- think product placement.  News articles may have product promotions integrated into the story to get by AdBlock.

I am still optimistic that AdBlock proliferation could end favorably- there is a lot of money in play, and technology can change quickly.  One of the most promising scenarios is that only the most obnoxious ads will get blocked and the good ads- like mine- can get through, and people can enjoy free content on the Internet.

This seems better than the alternative where all ads get blocked, and a different way for readers to pay for content must be established.

Penny Pincher Journal

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Pay This Bill- It Will Make You Rich!

Pay This Bill- And Get Rich! 

Your Most Important Bill!

Would you be surprised if I told you that by paying one of your bills you will become rich?  The strange thing is that most people are not paying their most important bill.

Let’s start by figuring out which bill could make you rich if you pay it.  Is it your mortgage?  Your electric bill?  Your grocery bill?  Your tax bill?  It’s none of these, and most people will not figure it out without some clues.  Part of the reason this most important bill doesn’t get paid is because people don’t even think about it.

You’ve probably heard the expression “pay yourself first”.  With this clue, do you know which bill is your most important bill to pay?

Image Credit:  Public Domain Image , Source: https://pixabay.com/en/letters-envelopes-letter-stack-post-286541/

What Does It Mean to Pay Yourself First?

You may have heard the common personal finance advice to “pay yourself first”, but what does that mean?  Paying yourself first means to take money for your savings or investment out of your paycheck first, and then pay other bills, such as the ones mentioned above.

Paying yourself first is not what most people do.  Most people spend their paycheck until it is gone and then hang on to make it to the next payday.  If you don’t pay yourself first, you will always be doing this!  The only way to break this cycle is to pay your most important bill first and save or invest money to build your wealth.

But What If There Is No Money Left After Expenses?

I think many people intend to save or invest any money that happens to be left at the end of the month, but there just never happens to be any left.  It is simply too easy to spend money if it is available.

People respond differently to bills than they do to goals.  If you give most people a bill, they manage to pay it somehow.  They understand that there are consequences for not paying a bill.  Not paying yourself first also has big consequences that grow as you pass your peak earning years and your income starts to decline.

 Even worse, the longer you wait to start paying yourself, the less time that your money will have to grow.

Think of the money you need to invest to build a retirement fund as a bill and pay that bill first.  If you run out of money, you’ll need to cut something else instead of being late to pay your most important bill!

How Much To Bill Yourself?

If you have a detailed budget, you may be able to analyze your expenses and determine a reasonable amount to save each month.  If you are like most people, you do not have a detailed budget.  In this case, start with a small amount of savings- such as $50 or $100- and take this out of your paycheck before spending on anything else.

Another way to approach deciding how much to pay yourself is to set an investment goal and work backwards to figure out how much you need to save each month.  Using an estimated average return on investment, you can try out different monthly contribution amounts to see how long it would take you to reach your goal using this investment goal calculator.

You may be surprised to see how much even a small regular contribution can grow over time!

How To Pay Yourself First

Pay your most important bill by putting your investment funds from each paycheck in a savings account or investments account away from your other money to help avoid spending it.  If you leave your investment funds in your checking account with your other funds, it is more likely you will spend it rather than investing it.

I automatically take my investment contribution out of each paycheck to fund my 401K retirement plan through my employer.  Contributing to a 401K plan has two major advantages:  1) you contribute funds on a pre-tax basis, and 2) many employers offer matching funds.  I get $1 of “free” money from my employer for every $2 that I contribute.  If your employer offers a 401K program, make sure you are not leaving free money on the table!

Even if you are already contributing to a 401K plan or do not have access to a 401K plan at work, you can benefit from other investment types.  I contribute to a Roth IRA every month using post-tax funds.  The advantage of a Roth IRA is that you will not need to pay taxes when you take money out of a Roth retirement account after it grows.

Regardless of how you invest the funds that you pay yourself, you need to have money available to invest.  Adjust your spending to make room for your new bill by cutting back on your least important spending- such as fast food or buying items you don’t really need.

If you think of the money you need to save or invest each month as a bill and pay it, your spending will naturally adjust just like it does when you take on any other new bill that you have to pay.

Most of your bills increase over time, and your most important bill should increase also over time as your income increases and you find ways to make more money and cut your expenses.  The point of paying yourself first is to treat the money you save and invest as your most important bill and pay that first.

If you are having trouble paying yourself, start by cutting your expenses so you can afford to pay your most important bill.  If you are looking for ideas to save money, check out Penny Pincher Journal to find more than 101 things you can do right now to save money...

Make It Happen!  Next Steps to Pay Yourself First

• Decide how much to pay yourself every month or every payday
• Use an Investment Calculator to help set your goals
• Make sure you are getting the maximum company match 401K contribution
• Adjust your spending to make room for your most important bill
• Check out this free ebook with 101 tips to save money and cut expenses
• Set up an automatic deposit into an investment account

Dr. Penny Pincher Bio:
Today’s post is by Dr. Penny Pincher at Penny Pincher Journal.  In 2013, Dr. Penny Pincher bought a puppy on impulse that changed his life.  He realized he would have to quickly find ways to spend less money to cover this unplanned expense that put a big dent in his budget.  He started searching for ways to spend less money and sharing penny pinching tips on his blog.  You might wonder if Dr. Penny Pincher is really a doctor... yes he is- with a Ph.D. in engineering.

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