Midweek Roundup – Public Net Worth, Quicken Giveaway, Yodlee, Compact Fluorescent Bulbs, Cheap Furniture, & Stock Market Behavior
It’s only halfway through the week and I’ve already run across some great articles so far.
Public Net Worth
CAP from Stop Buying Crap asks the question, what if your net worth was public? Literally hovering over your head wherever you went. How would that change your behavior? Check out his graphic, I feel bad for the guy at the end of the line. Or how about a Stranger Than Fiction scenario where you could hear someone giving a play by play account of your personal finances? I can see how that would make me think twice about spending foolishly.
Quicken Giveaway
If you’re in search of a way to organize your finances, head over to Blogging Away Debt where Tricia is giving away free copies of Quicken. She is even offering free support to help get up and running. Free software and free support, you can’t beat that! Hurry, the deadline is quickly approaching.
Yodlee
I signed up for an account at Yodlee MoneyCenter a while back but haven’t put it to use yet. Golbguru from Money, Matter, & More Musings has a good article on how to setup a bill in Yodlee.
“It’s a very simple (and free!) and effective way of putting all (almost all) of your financial transactions in order. In my case, except rent, laundry expenses, and a few bucks in cash, everything gets managed through Yodlee via credit cards.”
Compact Fluorescent Light Bulbs
On the energy front, Matt from Binary Dollar lets us know that Australia is planning on banning the sale of incandescent light bulbs to reduce power consumption. I’m sorry to say our government isn’t that proactive on energy but at least someone in the private sector is taking matters into their own hands. As a company that many love to hate, it’s nice to see Wal-Mart trying to go green.
Free Furniture
My wife should have read this article. We spent way too much furnishing our new home a few years ago. In her defense, she bought only quality furniture and almost always for a significant discount. However, when I read about the FedEx box approach over at The Digerati Life, I can’t help but think about how much we could have saved.
Stock Market Behavior
I’m definitely not savvy on stock trading but am in the process of learning more. Jeremy at Generation X Finance tells us about the importance of broad market behavior when trading stocks.
“Each day before you make the first trade it is important to take a look at what the markets are doing. Identify if the broad markets are trending up or down, then determine what individual sectors inside the market are doing. This top-down approach will help you focus your trading strategy and allow you to filter out potentially poor trading ideas.”
American Century Ultra – Stupid Investment of the Week
A while back I complained about American Century Ultra and how I was getting out of the fund. It appears that Chuck Jaffe over at Market Watch agrees with my assessment of the mutual fund (TWCUX) as he recently labeled it stupid investment of the week. His article offers more insight into the history of the small cap turned large cap fund and it’s downfall.
Don’t Make Excuses
Although total investments in the fund have dropped Chuck wonders why some people are still hanging on. He lists 5 common excuses people make for sticking with decent investments gone bad:
- It was good to me once.
- It’s really not so bad.
- I don’t want to pay the taxes.
- It can’t stay bad forever.
- I’m too busy.
If you find yourself holding on to any stinker investments, help talk yourself out of them by reading his response to each of these common excuses.
A Warm Welcome to Readers from the Financial Times
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Thanks for reading and feel free to contact me here with any questions or suggestions about selling on eBay or personal finance.
How to Build Your Slush Fund by Selling on eBay
Do have something you’ve always wanted to buy but never had the money for? This installment of eBay PowerSeller Personal Finance Tips will help you get what you want without breaking the bank.
Budget Busters
Everyone has some type of budget, formal or informal. Most people also have things they’d love to buy that just don’t fit into the budget. One way to get that coveted new item is to carve out a tiny slice of your income over months or years until you’ve saved up enough. If you can’t wait that long then there’s only one way to get what you want. No, not credit cards! You have to make more money!
Making Money on eBay
You’d be surprised at how simple it is to make extra money by selling on eBay. My wife used to complain about the random items I brought home to sell until I showed her how much money I was selling them for. Now she’s all about eBay. Using the 10 tips below you can use eBay sales to build up your slush fund.
1) Buy What You Know
Everyone is an expert on something. Whether it is fashion, electronics, sporting goods, coin collecting, personal finance, or home improvement; buying what you’re familiar with will assure you get a quality product for a good price.
2) Buy What They Know
Companies spend tons of money building their brand in the mind of customers. Leverage the dollars they’ve spent, only buy well known name brand items to resell. They don’t have to be known to the whole world, just highly regarded in the niche you’re working in.
3) Do Your Research
Even when you buy what you know, you should still research the price, supply, and demand for items you purchase. Pay attention to details such as model numbers and item sizes in addition to the number and prices of competing sellers online.
I purchased some new iPod accessories for a real bargain but later discovered I couldn’t compete with the going price on eBay and now have to try and sell them through other means. I should have researched the lowest prices for competing products on Froogle before buying.
4) Know the Return Policy
What if you buy what you know and do your research but an item you purchased to resell just won’t move? If you can buy from a store with return policy of 15 – 30 days then you have enough time to test the waters and return the merchandise if they don’t sell.
Don’t avoid a deal simply because you can’t return it. If you know for a fact you can make money on something then go for it. Just make sure you’re comfortable with the return policy before committing your cash.
5) Consider Selling Costs
Buying something for $15 and selling it for $30 doesn’t mean you doubled your money.
Your total cost of selling could be $5-6 after you pay sales tax when you buy it and the eBay / Paypal fees when you sell it. I typically figure in my cost of selling at around 20% of the sale price. If that cuts too far into my margins I won’t buy the item to begin with.
6) Set Price Targets
Another way to describe this tip is don’t waste your time. If something is 75% off but regularly retails for only $5 don’t mess with it. Time is money. Know how much money you need to make in order to put the time into procuring, listing, and shipping a product. If the margins aren’t large enough, walk away.
7) Buy All They Have
Even with TurboLister it takes time to setup a product for sale on the web. If you find a good deal on an item, buy all they have. You only have to setup the listing once but you’ll get multiple sales out of that time you spend. I may get some snickers when I roll up to the checkout with a cart full of 20 of the same thing but I’m the one laughing all the way to the bank.
8) Use Discipline
Just like the investing world a disciplined approach is necessary for consistent long term growth. Tips such as buy what you know, do your research, and consider costs can also apply to investing in a company. If you don’t have the discipline to follow a system you may be better off letting a mutual fund manager grow your money for you.
9) Be Patient
In personal finance there is a saying of “Set it and forget it” in regards to your investments. The advice is to pick your allocations, setup an automatic investment, and check back a few times a year.
The same applies to selling in an eBay store. Once I list an item in my store I basically forget about it until it sells or someone asks a question. If I followed the principles I outlined above, I know it will eventually sell. I may check on items that have been listed for 6 months or more and adjust the price a little but in general I don’t worry about them once they’re posted on eBay.
10) Ignore the Critics
I’ve heard, “that’s too much work” or “no one will buy that”. The truth is if you follow these tips you should eventually have a buyer for all your products and your profits should be worth the time you spend.
Bonus Tip – Reinvest Your Profits
I sink almost all of my profits into more merchandise. The first thing I ever bought to resell was a box of custom Christmas ornaments. Even though I spent $8 and sold it for $20, I was nervous about losing my initial investment. Now if I see a great deal I won’t hesitate to spend $1,000 buying all they have. The continued reinvestment of my profits has allowed me to grow the money I have to work with. Now I can take advantage of deals I would have missed out on in the past due to limited capital.
Room for Improvement
Now you know my strategy for making extra money by selling on eBay. If you have any tips of your own that I’m missing out on please let me know in the comments. Happy selling!
Profiting from a Non-Profit. Ethical or Rotten?
Is it wrong to make a profit off of the Girl Scouts? I don’t think so. Read on before you disagree with me.
We Are Suckers
My wife and I don’t eat Girl Scout cookies but we buy them from the neighbor girls when they come knocking on our door. I think I inherited this trait from my mother. She’ll buy anything kids sell door to door just because they’re making the effort. So we spend money on the cookies to support the girls but they sit in our cupboard uneaten.
Cookies for the Highest Bidder
When I first started selling on eBay, I sold anything I could get my hands on. I ran across several boxes of Thin Mints sitting on the shelf and quickly put them up for auction. It was off-season for Girl Scout cookies so the law of demand had pushed their price on eBay over what we had paid for them.
Cookie Police
My excitement over watching the bid price climb was suddenly dashed one day when I received an email from a Girl Scout mother, chewing me up one side and down the other. I was an awful person from profiting off the Girl Scout organization and the hard work of those little girls. I responded to the scathing email in a courteous fashion but defending my actions.
After several such exchanges I realized I wasn’t going to get a pardon from the cookie police and left it at that. Of course I left the auction running and profited from shipping the cookies to a satisfied cookie fanatic somewhere on the East Coast.
Taking the Stand
I saw this season’s batch of Thin Mints on the shelf today and decided I needed to try my case in front of the world.
We help these girls out every year by spending money on something we don’t want. Is it wrong to resell them later on for a profit? It wasn’t Girl Scout cookie season when I sold them so I wasn’t stealing any business from the little girls. It seems like a win/win/win to me. The Girls Scouts sold a few boxes, I made a little money, and I delivered the cookies to a cookie junkie, craving a fix during the off season. I rest my case.
What do you, the jury, think?
Ending Your Retirement Nightmare
Have you ever had a nightmare where you showed up for a final exam in school then realized you hadn’t been going to class all semester? Panic time. Why hadn’t you been going? What had you missed? How were you ever going to pass this test?
Retirement Nightmare
Many people dream of retirement as a time when they’re free to do what they want in life. For some people the coming of retirement age will be more of a nightmare. Imagine this you’re almost 65 and about to retire when suddenly you realize you haven’t been saving money for retirement.
You break out in a cold sweat. What was I thinking? What am I going to do? Why did I wait so long? You start to run backwards, trying to turn back time but it’s like running down an up escalator. You don’t make any progress and are slowly moving towards the end of the ride. What on earth will you do when you get there?
Turn Back Time
Wake up! Wake up! You’re just dreaming. Take a deep breath; wipe the sweat from your brow. It’s not too late, retirement is still years away. Never forgot how awful and hopeless that nightmare felt. Start preparing today. Read what the experts have to say about retirement planning at about.com or cnnmoney.com or check out personal finance sites like Kimmunications or My Retirement Blog. Make a plan and stick to it to keep your retirement nightmare from becoming a reality!
How to Save Money by Preventing & Treating Frozen Pipes
One of the fastest ways to blow a few hundred or even a few thousand dollars on home repairs is a burst water pipe. Below are tips on preventing and dealing with frozen water pipes that I ran across yesterday as we hassled with two of them in our house.
Prevention
It’s not surprising we had a problem considering the recent single digit temperatures here in the Midwest. If the temperature in your areas drops, beware! A Weather.com article reports that the majority of frozen pipe incidents occur when the outside temperature is 20°F or below.
The article recommends insulating your pipes and sealing any cracks in your outside walls and foundations near water pipes. You can also use electric heating tapes and cables but be sure the tape is certified by a nationally recognized testing lab to prevent fire hazards. Here is a helpful article on how to install heat tape.
Another method is letting your faucet drip during extreme cold.
“opening a faucet will provide relief from the excessive pressure that builds between the faucet and the ice blockage when freezing occurs. If there is no excessive water pressure, there is no burst pipe, even if the water inside the pipe freezes.”
Damage Control
I spent most of the day yesterday thawing out our frozen pipes. I turned to this advice from MyGreatHome.com for help. The article suggests four different methods for taking care of frozen pipes.
- Use electric heat tape on the pipe.
- Wrap the pipe with several layers of cloth or toweling and pour hot water over the cloth / toweling.
- Direct a heat lamp on the pipe itself.
- Hold a hand-operated hair dryer to the pipe, and slowly move up and down the length of the frozen section.
I opted for the heat lamp and hair dryer approach and by the end of the day the pipes were clear! Make sure you read the caution section for each method in the article so you don’t cause yourself or home any further harm.
Prevention is the Best Cure
After spending a whole day working on and worrying about frozen pipes, I wish I had done a better job preparing our house to avoid them. If you think this could be a potential problem in your home learn from my lesson and get to work! It can save you a good deal of time and money in the long run.
Which Motivates You? Financial Incentives or Financial Penalties?
Thanks goodness for late fees! No, I don’t really feel this way but Golbguru has an interesting article arguing that late fees are necessary to keep us “inherently lazy” people on track systems moving efficiently.
Responsibility
He makes a good point. I hate having to pay out extra money in late fees. I’ll even call up a company and try and get out of them. However, I need to remember when I “earn” a late fee it’s really myself I should be getting pissed at, not the company. As Stephen Covey says, responsibility is the ability to choose our response to a situation. We can get mad at the company and be late again next time. Or just shrug it off and be more timely with the next payment. In the future I’ll try not to get so worked up over late fees but I’m still going to call and try and get out of them.
Punishment vs. Reward
He also argues the reason that late fees are so prevalent is hat punishments are more effective than rewards in most cases. This got me thinking, I wonder how it would work out if companies offered an incentive to return items or pay bills early. For example, if I paid my credit card balance a week early American Express could give me some sort of reward. The financial penalties from the late fees of others could go to fund the incentives.
It would be an interesting experiment, I wonder if people would change their behavior to take advantage of the incentives or if they would stick to their old ways of either late or timely payment.
Too Chicken To Buy Stocks
Does it make sense to read books and magazines on building a stock portfolio but not actually have one?
Theoretical Investing
I loved reading the Intelligent Investor and am just starting on A Random Walk Down Wall Street. I look forward to getting the latest Smart Money and Kiplinger magazines in the mail every month and enjoyed breaking down corporate financial statements in my graduate classes. I know the concepts and fundamentals so what’s my problem?
Risk Averse
I lost several thousand dollars in the technology bubble during my introduction to the stock market in the year 2000. I learned some valuable lessons but since then have bought mutual funds and haven’t purchased a single share of stock. I know a lot more about investing now, I just can’t seem to get myself back in the saddle.
Easing Back Into Investing
I ran across a virtual stock game today at eFIPO that I’m going to use as my launching pad back into investing directly into stocks. The Virtual Stock Exchange by MarketWatch will let me practice analyzing companies and seeing how their stock performs over time. I’m not planning on making individual stocks a large portion of our portfolio. My goal is to hone my financial analysis skills to the point where I can find a few quality stocks for the long haul.
Back To Reality
Of course, this is just an exercise to strengthen my knowledge and grow my experience. Sooner or later I’ll have to suck it up and put my money where my mouth is. When I do, I’ll be sure to checkout the different brokerage reviews over at Generation X Finance to help me determine where to get started.
Having a Baby? Get Ready to Spend Money on Insurance!
There are many different life events that require you to spend more money. I was reminded today of one big expense that often comes with change, buying more insurance.
Baby Bills
Having a baby adds all kinds of expenses you never dreamed of before becoming “responsible”. One of these is the need for more insurance. We just had a kid and are actually responsible for a little person now, I know, kind of scary! To help watch over his best interests we signed up for short-term disability insurance to pay the baby bills just in case one of us suddenly can’t work for some reason. The policy will provide supplemental income for six months to help get us through any unexpected medical emergencies.
Life Insurance
We also added life insurance through my employer to cover the costs for our little one in case his parents vanish from the face of the earth. I still need to do more research on term and whole life policies to determine what’s in the best interest of our family long term but for now we’re covered through work.
Worth Every Penny
Although the extra insurance premiums add up it’s worth it to know the family will be covered in the event I’m not able to take care of them in the future. I just never knew being responsible was going to be so expensive! 🙂
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I'm Ben Edwards and I've been addicted to personal finance since I was 12 years old.
That passion for money has paid off for my family - so in 2006 I founded Money Smart Life to help you afford the life that you want. Read My Story...
