Netflix Free Trial Can Save You Money

A Netflix promo offer might be able to save you a chunk of money.  The one month Netflix free trial offer has been around for new customers for a while but I wanted to share how using Netflix has saved us money.  The cool thing is you can test it out for a month and see if it works for you with their free trial of Netflix – try it here.

Saving Money with Netflix

I recently pulled the plug on my cable bill, saving us around $85 per month, so I’ve been increasingly interested in online streaming options for our content needs.

With traditional television services such as cable and satellite you pay a rather large monthly fee to access a varying quantity of programming. The more you pay, the more premium channels (like ESPN and HGTV) you get.

Personally speaking I think it is a broken system. I don’t watch Oxygen, Discover Health, or American Movie Classic. Why should I pay for channels I don’t use?

Unfortunately it will be quite some time before you’ll be able to purchase a handful of channels that meet your entertainment needs. That is, of course, if it ever happens. Providers have no incentive to make this change so it seems unlikely.

Until that happens you do have a couple of options to get some of your content. There has yet to be an option available that covers everything, but one significant piece of the equation for many people is Netflix.

What is Netflix?
Netflix and Redbox are the companies that killed Blockbuster and forced it into bankruptcy. In the past you had to physically go to a video store to rent a movie. You paid a relatively high rate to rent the movie for 2 to 7 days.

Enter Netflix. Netflix started by offering DVD rental through the mail for a fixed rate. There were different tiers and the more you paid the more movies you could have out at the same time. For smart users that watch a lot of movies Netflix was more convenient and much cheaper than renting from a store.

Redbox offered another alternative by letting you rent your movies for less from a kiosk.  Of course the difference between Redbox vs Netflix is that Redbox has a much smaller set of choices than Netflix and lacks the conveinence of having the movie delivered to your door.

But the coolest feature of Netflix, the one that helped us save money on your cable bill, is that the service lets you stream shows online.

How Does Netflix Streaming Work?
As technology progressed so did Netflix. Now instead of having to wait for a DVD to arrive in the mail you can simply stream the movie directly to your playing device immediately.

There are certain devices that work with Netflix streaming. These include the major gaming consoles (Wii, X-Box, Playstation 3), some high definition televisions, Apple’s iPhone and iPad, and media center players such as Roku and Tivo. You can also stream directly to a Windows or Mac computer.

You plug the device into your internet connection, access Netflix, and decide on what you want to watch. Make your selection and it will begin streaming to you immediately.

What Can You Stream with Netflix?
Netflix can stream movies and television shows. The selection can fluctuate as more selections are added. Some television shows are not immediately available. New episodes can be delayed as little as 1 week to as long as the following season.

Can Netflix Streaming Replace My Cable Company?
The ability for Netflix to replace your cable or satellite company depends on your entertainment needs.

If you don’t need to see the most recent episode of a television show the instance it airs, then Netflix’s streaming service might work for you.

On the other hand if you need to watch live sports on premium channels then Netflix isn’t designed to cover that specific need.

That isn’t to say Netflix can’t take care of some of your other entertainment needs, just not instant television shows and live premium content.  Like I said earlier, you can test it out for a month and see how it all works for you.  There’s no coupon code required to get the offer, just sign up their free trial. 

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Online Brokerages Tax Software & Training

Online brokerages can offer tools that can make tax planning and tax preparation easier. If you calculated your capital gains taxes on stock sales last year on your own, you might wish there was any easier way to track the details when you’re selling stocks.  It can be a pain keeping track of the purchase price and commissions in order to figure out your cost basis when you’re filling out Form 1040 Schedule D.

Of course, being your own stock tax calculator isn’t such a big deal if you only have a few transactions but if you buy and sell mutual funds or stocks more frequently – then keeping track of those details can be time consuming.  Today we take a look at the tools that some of the online brokerages provide to help you make your job a little easier.

Scottrade
If you are looking for helpful information about your taxes and your Scottrade account, there are some helpful webcasts. One of the most helpful is the one that tells you how to download gains and/or losses to your tax software. The Gain/Loss & Tax Center is free of charge to Scottrade online customers. You can see your realized and unrealized gains/losses, as well as export data into TurboTax and other software, or to export it into Excel or Text. Also available is an audit trail to help you follow particular holdings. Use the helpful webcast on finding your Scottrade tax information to help you make sure that you are getting everything you need to have your taxes prepared properly.

E*Trade
E*Trade offers you a free trial and a discount on the capital gains tracking software Gainskeeper. The ability to automate your Schedule D is a definite plus, as are the portfolio tips that allow you to optimize your performance for tax purposes. Try the promo code ET2004 to help you get a discount on your initial GainsKeeper subscription.

Etrade also offers a 25% TurboTax discount for versions of TurboTax online for it’s customers.  You can also check out the Online Tax Center at E*Trade to find tax forms, calculate cost basis, find dates needed for filing, and use any number of other tools to help you gather the information you need to complete your tax return.

Vanguard
If you have questions about preparing your taxes with information from your Vanguard account, the Tax Center FAQs. Learn more about what to expect, and what to do with your tax forms and how to report the gains and losses from your holdings.

On top of offering a tax center, it is worth noting that Vanguard also offers two versions of TurboTax to clients: Online and Desktop Download. You can prepare state and federal returns using this software through Vanguard. Pricing depends on the version you use, but it is available at a 25% discount when you get it through Vanguard, rather than simply buying it elsewhere. Flagship clients actually receive access to TurboTax free of charge.

In order to receive the discount, you have to log into your Vanguard account before going over to the TurboTax site. If you save your progress and come back later, you have to go back through the Vanguard site.

Charles Schwab
Schwab doesn’t offer any tax software discounts but it does give you the option to download your account and tax information into Quicken, TurboTax, and CompleteTax. When you’re using any of the software tools they may ask if you’d like to retrieve information from your online broker.  All you have to do is enter the same login and password as you do when accessing the Schwab website, and the tools will download your account information. You can also find your 1099 forms and other tax information on Schwab.

Fidelity
If you use Fidelity, it is possible for you to import your tax information right into TurboTax. This is helpful, especially since you can import your 1099 directly from Fidelity into your tax preparation software. This includes your 1099-R, which can be helpful for those who took retirement account distributions. Your W-2 can also be imported if your paycheck is processed by Fidelity. Cost basis information and other important tax information can also be imported to your tax prep software.

Zecco
Zecco also provides a free trial of Gainskeeper to it’s investors.  Here are the three main tools their highlight in the GainsKeeper suite:

GAINSADVISOR allows you to get an idea of different capital gains scenarios. You use trade simulations to figure out what will happen when you sell different tax lots. You can also get information about moving into long-term from short-term, and have a look at wash sales.

GAINSTRACKER is another tool that can help you. Look for gains (realized and unrealized), and keep up with your portfolio performance over time. You can optimize your tax costs, and look for specific trades.

Their TAX CENTER offers the tax prep tools you need to fill out investment portions of your tax return. You can export data from Zecco to your tax prep software, and you can automate the preparation of your Schedule D.

Firstrade
Firstrade also offers a discount on Gainskeeper to its customers. As we’ve mentioned, it can help you keep track of gains and losses, and get helpful planning tips to learn more about how you can reduce your tax liability. You can also get help filing your taxes with the automated Schedule D.

Firstrade also lets you download your account information in multiple formats that you can import into tax prep or personal finance software. From a tax planning perspective, Firsttrade offers some helpful information on tax planning and the implications of trading on your taxes in its Tax Education Resources. 

TradeKing
TradeKing offers the Maxit Tax Manager from SciVantage to let you track your capital gains and losses and help you create a Schedule D.  There’s no fee to use the cost basis and tax reporting software, current TradeKing members have access to Maxit.

TradeKing is pretty big on investor education, once a month they hold education webinars for new investors.  Recently they did a Maxit tutorial that walks you through how to use the software and generate a Schedule D.  TradeKing does say to double check your Schedule D to make sure Maxit didn’t miss anything.  This really also applies to customers of any online brokerage using software like Gainskeeper or Turbo Tax, you know your trades better than the software so be sure to double check.

Hopefully this was a decent overview of some of the tax software and education you can find at online brokers around the web.  Good luck with your taxes!

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American Express Expresspay

American Express has a way to use your credit card without having to physically swipe it at the cash register. I used it the other day at Walgreens and it’s pretty slick – it’s a neat use of technology called American Express expresspay.  You make your payment and earn your reward points or cash back by just holding it in front of the card reader – and for most purchases under $25 you don’t have to sign a reciept.

So why did American Express develop this new technology?  Partly for consumer convenience and also to address a few issues with the current credit cards we use today.  The main benefits of wireless swiping are:

• Faster transactions
• Reduced credit card wear
• You retain physical control of the card

Credit Card Issues

Magnetic stripes wear out.  If you’re using your card a lot the magnetic stripe in the back can get worn out or damaged by card readers. Even if it’s just sitting in your wallet, the stripe gets worn down over time from rubbing against other cards. This may seem like a minor detail, but think of all the things that have to happen to get you a new card:

• You have to call customer service and sit through a phone tree.
• They have to verify your identity and why you need a new card.
• They have to physically print you a new card and mail (or overnight) it to you.
• If they gave you a new number you need to update all of your online or automatic payments. Even if the account number stays the same (it should) you’ll probably get a new CCV2 code on the card for security purposes.

Loss of card control. When you hand your credit card to a cashier you’re physically losing touch with the card. If you’re paying attention you might be able to notice any shady dealings the person on the other side of the counter has with your card, but turn around for a minute and they could steal your card number and CVV2 code.  It doesn’t happen that frequetly but it’s a risk for the credit card company.

How Does Expresspay Work?

With AMEX’s expresspay there is an RFID chip embedded in your credit card that wirelessly communicates with wireless point of sale terminals. Instead of having to swipe your card you simply hold the card close to the card reader and it automatically transfers the credit card data to the merchant’s point of sale system. The card detection happens very quickly and speeds up the transaction for you and the merchant.

Where Can You Use Expresspay?

As I mentioned earlier, my AMEX Blue Cash card has one of these RFID chips, and I’ve used it several times at Walgreens.

This is still a relatively new technology so you need to look for the expresspay logo ( or ) on the card terminals at your favorite retailers. Want to see who might be rolling out new terminals to support the cards? American Express has a handy list of expresspay merchants for you.

What Cards use Expresspay?

American Express has rolled out the following cards with expresspay chips in them:

• Clear from American Express
• Blue from American Express
• Blue Cash
• ZYNC from American Express
• Blue Sky from American Express
• Starwood Preferred Guest

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Saving Money in Crazy Ways – Carnival of Personal Finance #297

Even though the recession is technically over, many of us are still looking for creative ways to save money. Or at least make more money. Or better our finances. This Carnival of Personal Finance highlights great ways to improve your personal economy — no matter what the national economy is doing. Most sections has a video of crazy things that people do to save money. Enjoy!

Editor’s Choice

Here are a few posts I found especially helpful this week.

• Who has your personal financial information? Prairie Eco Thrifter has 8 ideas for protecting yourself from ID theft.
• Squirrelers really puts things into perspective by helping you see how many hours you are working to buy your stuff. Eye-opening. And a little depressing.
• A Gai Shan Life presents an interesting look at the financial (and emotional) issues that can accompany having your parents move in with you.
• Dealerity is taking a challenge to live near the Federal poverty line for a month. It’s a fascinating challenge, and I also found his update for Day 15, focusing on accepting help from others, quite interesting.
• Moneyed Up offers some good advice on how you can be good at what you do — whatever that is.

Budgeting & Money Management

It’s important to consider your budget. This means planning your spending and doing your best to avoid buying things you can’t afford.

• If you are looking for help with your financial goals, You Have More Than You Think offers you an idea of what your #1 tool could be.
• As your net worth calculations become too complicated, Money Beagle asks if perhaps you should ditch the earmarks you have been using.
• First Generation White Collar shares some thoughts on why financial willpower is so difficult to come by — and what you can do to get beyond it.
• Let’s get real. Couponing may not always save your finances. Sometimes you have to sweat the big the stuff, insists Moolanomy.
• Net Worth Journey helps you understand how debit card transactions work.
• Set a good example and teach your children something worthwhile. Christian Personal Finance offers good ideas for helping your kid buy a car.
• Matt About Money takes principles from the business management classic Good to Great and applies them to personal finance.
• Len Penzo dot Com offers a look at the Personal Finance Anarchist Cookbook. Watch out for these dangerous money items.
• Money Walks presents some ideas for keeping your food budget under control.
• Activity isn’t always the same as achievement. This is true in money management, insists THE Canadian Finance Blog.
• Do you have a variable income? The Dough Roller provides insight on budgeting in such situations.
• Adjust your budget to cope with rising food prices with some help from Modern Gal.
• Review of best personal finance software. One Money Design helps you find a program to keep you on the right track.

Career

What sorts of decisions are you making with your career? Are you impressing others with your good ideas? Or have you neglected to think things through?

• Looking for a legitimate work from home job? Living Richly on a Budget looks at the site FlexJobs.com as a source for telecommuting jobs.
• If you want to start your own business, this post on using your IRA for that purpose is a helpful resource from Good Financial Cents.
• Personal Cents provides practical insights on being self-employed.
• What if becoming a stay at home parent is the next step in your career? Well Heeled Blog takes a look at what you need to know.
• Dividend Stocks Online helps you figure out when you can retire. The ultimate in career goals.

Credit & Debt

Running up debt? Spending on credit instead of saving? Here are some things to think about.

• You never can be too careful. You want to save money on credit card interest, but Credit Card Assist Blog points out that you might be heading into a rate reduction scam.
• Someone is always trying to part you from your money. Consumer Boomer offers you a look at these debt relief scams to be wary of.
• Know your rights. The Credit Card Forum Blog shares some of the legalities behind whether or not credit cards companies can sue you.
• Even good debt can go bad, points out Money Help for Christians.
• Learn how to pay off debt quickly with some tips from Accumulating Money.
• Find out how you can get a free credit score when you read The Sun’s Financial Diary and a take on Credit Sesame.
• Free From Broke reviews the Platinum Card from AmEx.
• It’s hard to stay motivated when trying to pay off debt. PT Money offers some encouragement.
• It would be great if debt free living was good for your credit score. Unfortunately, points out Canadian Finance Blog, it’s not.
• Learn how you don’t need a personal guarantee for a business credit card at CardHub.com.
• Gen X Finance talks about how to shop for the best mortgage
• NerdWallet Credit Card Blog cautions readers against buying extra AAdvantage Miles.
• Is Yes I Am Cheap crazy for purposely adding $20,000 to credit cards?
• Lazy Man looks at how to get a free credit score.

Economy & Finance

In this tough economy, it’s important to find ways to save money, from saving energy in the home to saving money on transportation. How are you dealing with the economy?

• Did you inherit an IRA? New IRA Rules offers a helpful look at what you need to know about an inherited IRA.
• Why is wage inequality on the rise? Don’t Quit Your Day Job offers an explanation of the economics behind wage differences.
• Can you really trust financial simulations? The Oblivious Investor takes a look at the situation.
• The children are our future. Barbara Friedberg looks at the importance of teaching financial lessons to your kids.
• There are special financial challenges when you are in the military. Compounding Interest takes a look at finances and military members.
• Darwin’s Money provides you with a look at the difference between financial accounting and managerial accounting.
• Food inflation is coming. Financial Uproar wonders if you’ll even notice.
• If you are a common consumer, Money Thinking offers a helpful look at deal-making and the price mechanism.
• Are you ready to recognize the truth about your financial situation? Until you do, points out Hope to Prosper, you won’t be able to make solid progress.
• The Military Wallet warns that military personnel had better get used to fee increases to TRICARE Prime.

Frugality

There’s nothing more frugal than free. But, free isn’t always an option. Here are some articles that will help you live a little more more frugally.

• A new addition to the family on the way? Fiscal Fizzle offers a look at 10 things you can do to save money on a new baby.
• Protect your home, fortifying it against would-be intruders. Live Real, Now tells you how to do it frugally.
• Is it such a good thing that everyone is talking about “frugal fatigue?” Surviving and Thriving is a little worried about what it could mean to trivialize the idea of frugality.
• The Red Stapler Chronicles shares the personal finance hall of shame.
• Want to save money? Grumpy Rumblings of the Untenured says that sometimes it’s as easy as asking.

Investing & Real Estate

What sort of investments are you making? How do you scrape together the money to invest more, anyway?

• With a good brokerage firm, points out Qwoter, you can get better returns..
• Green Panda Treehouse can help you learn a little bit more about exchange-traded funds.
• Once you have learned the basics of ETF investing, Experiglot can help you figure out ETF allocation.
• Shareholders of Google might be interested to know about the new CEO, Larry Page. Intelligent Speculator is ready to provide a little background.
• For most ordinary investors, marketing timing is probably not the best investment strategy. The Dividend Guy Blog tells you why marketing timing might be a bad idea.
• Young? Interested in investing? Do Not Wait offers tactics that can help you find investing success.
• If you pick right, according to Compounding Returns, your long term stock investing strategy can pay off big.
• Interested in a solid retirement vehicle? Smart On Money explains why the Roth IRA is a popular choice.
• Investor Junkie offers a review of the online broker TradeKing.
• Back Nine Finances shares the process of looking for an income property.
• A great interview with an energy fund manager from Investing Thesis.
• An overview of different types of mutual funds from Buy Like Buffett.
• Learn more about timing your stock trades with help from The Digerati Life.
• The Smarter Wallet encourages you to own stocks for long enough to make a profit on them.
• Emerging markets are enjoying a boom. Retire Happy looks at emerging market investing.
• Learn how to maintain your asset allocation as new funds come in from Dividend Growth Instructor.

Taxes

You want to save all the money you can when it comes to what you owe the government. After all, it’s about keeping what’s yours anyway.

• Want to know the difference between married filing jointly and married filing separately? Bargaineering gives you a crash course in filing status.
• If you adopted in 2010, Spruce Up Your Finances can help you navigate the adoption credit on your tax return.
• Want another chance at a tax deduction? Bible Money Matters points out that you can still open an IRA for 2010.
• Curious about whether or not credit card rewards are tax deductible? My Dollar Plan has an answer.
• Wallet Blog points out that even if you are unemployed, you still have to pay taxes — and on your unemployment income.

Other

In the end, how you save money says a lot about you. How do you keep from spending too much?

• Free Money Finance continues to struggle with Sears. The latest in the epic battle between company and customer.
• Learn how to follow worthwhile wealth creators on Twitter with these tips from Money Cactus.
• Find out the basics of if you need travel insurance from Help Me Travel Cheap.
• Saving to Invest offers a primer on the importance of life insurance, and how to choose the right option for you.
• Want to know more about the costs and benefits of the Samsung Epic? Budgeting in the Fun Stuff offers a review.
• You can your cash out your prepaid debit card. Growing Money shows you how.
• Consumerism Commentary asks readers the question: Are you better off than your parents?
• Is there a link between money problems and domestic violence? Cash Money Life explores the possibility.

Next Carnival will by hosted by Saving to Invest. Be sure to get your submissions in using the form.

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Angies List Scams

Angies List came to my mind when I heard several recent examples of contractor scams on the news and in person. Just last month the Angies List magazine featured some of the worst contractors in the country and profiled common scams that involved things like false or decieving advertising, sneaky sales tactics, bad service, or cases where they take your money and don’t do the work.

Contractor Scams

I recently heard examples of some of these in our area.  One local news station profiled a woman who hired a contractor to install new windows.  He started the work but then started making excuses for why he couldn’t and eventually just disappeared.  Another TV show did some undercover reporting on duct cleaning companies that pulled major bait and switch jobs with their advertising and then didn’t even do all the work they upsold the homeowner on.  Lastly, our realtor paid several thousand for home improvements and then the contractor never even showed up to do the work.

How to Avoid Getting Ripped Off?

I think the first lesson from these is to avoid paying up front for the work.  Most contractors ask for some down payment to get started but if they require full payment prior to starting I’d look elsewhere.  I’m sure our realtor wished he’d only put down half up front.  Of course it stinks to lose any money at all but half is certainly better than all of it.  That case hits even closer to home for us because in a way, it was our money that was stolen.  We paid him thousands in commission to sell our house, then the contractor defrauded him out of some of that money, ouch.

In two of the cases I mentioned (window lady & our realtor), it turns out the person they hired had a history of not delivering on their work.  That’s one of the reasons we use Angies List to check out any contractor or business we’re considering.  If they have a history of issues then past customers may report it on Angies List.  You can search for contractor reviews by name or phone number as shown below:

If you don’t have a specific person you want to check out but just want to find some good referrals to call you can search by category or keyword.  For example, the lady in the air duct scam I mentioned earlier could have checked out the “Air Duct Cleaning” category in her city, or just searched on air duct cleaners.

Avoiding Contractor Scams

As I referred to above, Angie’s List magazine points out bad contractors and scams – one of the main ones from last year was air duct cleaners.  Sounds like many of the shady ones setup shop in a city for a few weeks, with a store front and phone number, and then move on.  So you couldn’t depend on reviews for companies like those but reading about the air duct cleaning scams would give you the red flags to look for when evaluating companies.

For a company that does have a history of consumer complaints, look for a scam alert like the one below.  This shows you what it looks like when you search for a company on Angies List and they have a record of issues.

Of course not everyone uses the service to leave reviews so there will be questionable companies who don’t show up in the search results.  The way I try and avoid companies like that is by sticking with contractors that do have a good number of positive reviews.  Last summer I explained how I find local contractors using the service and also did an Angies List review. 

It is a paid service, which is why I avoided it for a few years.  But now that I’m using it I think it’s definitely worth the cost, I also have some Angies List coupon codes you can use to save some money on your membership.

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Home Security System Savings

Can a home security system help you save enough money on your home owner’s insurance to make it worth the expense?  The answer really depends on why you’re considering installing a security system.

One of the main benefits of having a security system is the sense of protection it can offer. You’re paying for the feeling that your home and your family have a lower risk of something bad happening – and a better chance of getting a break-in or house fire resolved more quickly. 

Of course it’s hard to put a price on your safety and peace of mind but there are some numbers you can think about when trying to decide whether a home security system is worth it.

Home Insurance Savings

When you’re looking at trying to save money on home insurance the best thing to do is call up your insurance company and ask them what security improvements could lower your premiums.  Adding prevention measures such as smoke detectors or a burglar alarm will each lower your rates individually.  Then if you combine them into one system and add in monitoring the insurance savings could around 15–20% off your current payment.

You can get your insurance agent on the phone and ask them about different scenarios to see how much each security enhancement could save you.  Ask them for recommendations about specific systems and security companies to see if some have a bigger impact on your rates.

The savings in your insurance premiums likely won’t be enough to pay for the cost of the security system but it can make a difference. For example, let’s say you sign up for security monitoring that costs $30 per month – $360 per year. If you pay $500 every 6 months for your homeowner’s insurance and installing the system cuts your premiums by 20%, then it effectively drops the costs to $260. It’s up to you to decide if you’re willing to pay that much annually for a security system.

Home Security System Savings

There are two main costs that go into getting a home security system: having the system installed and the monthly monitoring service. It’s possible to get discounts on both but you’ll have a harder time getting a deal on your monthly fee.

Home Security Discounts

You can have a lot of success in getting a free security system installed, or at least a significantly discounted home alarm system. The security companies use a model somewhat similar to what your cell phone provider uses. They’ll give the equipment away at a significantly discounted cost or free just to get you to sign the two or three year contract.

Most major companies will either offer you a free system up front or you can negotiate for it. They really want you to sign that long term contract because they know once you start using the service you aren’t likely to stop. You build the cost into your budget and forget about it.

Once the original contract term is up, unlike cell phones, there isn’t usually a need for you to get new equipment in your home. The equipment they installed three years ago is fine, and instead of having to fork out new equipment again they just keep you on your steady monthly contract.

Discounted Monitoring Service

This is where you’ll receive push back on discounts. Again, think of the cell phone provider model. The major carriers give away phones or sell them at significant discounts, but you hardly ever see discounted monthly plans. The monitoring service is where the security company recoups the cost of the installation and eventually makes the monitoring profitable for them.

Any reduction in the monthly income from your house is likely to be met with resistance. The best way to get a discount is to pick up the phone and call a salesperson at the company. Be sure to have your research in front of you in terms of what other firms are offering, and proceed with normal negotiation tactics from there.

Occasionally you can find online specials, such as the Monitronic deals page.  You might also be able to find discounts through your insurance company. For example USAA has an agreement with ADT that can help save members money on the service.

Do You Need a Major Security Company?

If you do decide to install a home alarm system and check out your local Yellow Pages for home security you’ll probably see a large number of companies offering their services. The important thing to note is in may cases the companies you find in the Yellow Pages are tied one way or another to the major brands like ADT, Brinks, GE, Protection One, and Monitronics.

From a technology and logistics perspective it doesn’t make sense for the small security company down the road from you to be an independent firm with their own monitoring center. Instead they are usually an authorized seller or dealer for one of the major security companies.  Just ask any company you’re working with who does the monitoring on your home to be sure it’s one of the proven major players.

Hopefully this home security systems review gave you some items to consider when you’re comparing security systems and deciding if the cost is worth it to you.

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What are the Best Credit Cards for You?

The best credit card for you really depends on how you use your card – that’s how I started my email to a lady named Brigid who recently joined my email newsletter and was asking what the best credit card was for her to use.

I actually met Brigid a few months ago at a local event and she remembered me talking about Money Smart Life, so when she started her search for a new credit card she reached out to me.  She was looking for a list of the top three credit cards and wanted to know what my favorite ones were.

Of course, my reply was that how you plan on using your credit card makes a big difference in which one is the best for you.  Here are some of the questions I sent back to her to help narrow it down:

1) Do you carry a balance or pay off your card in full each month?
2) How often do you travel each year?
3) Approximately what dollar value do you charge on your card each year?
4) Do you use your card to buy gas and/or groceries?
5) What card(s) do you currently use?
6) Do you have a good credit score?

Of course this doesn’t cover all the bases but it was a quick starting point to get a feel for her situation. Brigid runs her own business so she’s a pretty busy lady and I haven’t heard back from her yet.  I started writing up more detail on the reasoning behind each question and my answer grew long enough I decided to post it for everyone. 

1) Credit Card Balances

If you’re going to carry a balance then it’s best not to use a credit card at all because the interest you’ll pay will be steep.  If you already have some credit card debt you’re paying interest on, one option is to consolidate the balance into a lower interest loan.

You might be able to get lower rates with a peer lending service like Lending Club or you could also look into a balance transfer credit card if you’re going to pay it off within the 0% interest window.  Citibank usually has some of the best balance transfer terms out there, for example cards like the Citi Dividend Platinum Select or the Citi Platinum Select. 

2) Travel Rewards Cards

If you don’t travel much then a card that earns you rewards for travelling or points that you can use for flights and hotels won’t do you a lot of good.  I know I used to have frequent flier points that I didn’t use or that expired over time.

If you’re not a frequent traveller but you’re saving up for a big trip some day just keep in mind that airline miles or hotel points may not have the same bang for their buck when you’re ready to use them in a few years.  For example, the Southwest Rewards card, is changing their airline rewards program so that points never expire.  But you still have to fly or use one of their rewards partners once every two years to keep your rewards active.

Since rewards programs change over time so it might be best to use something like cash back rewards and save the cash.  Cash rewards don’t usually have as good a redemption policy as travel rewards or gift cards but if it’s for years down the road, at least you know the value of your cash won’t change.  Another option is to use a card that isn’t tied to a single airline, such as the Blue Sky card from American Express.

If you do travel quite a bit, a good follow up question would be how do you spend most of your money when on the road?  This can help you determine if you’d benefit most from airline rewards, rental car rewards, or hotel rewards.  One thing to keep in mind is that some of the best travel rewards cards are offering big bonuses these days so be sure to compare those as well.

3) Credit Card Reward Caps & Tiers

If you don’t buy that much with your card each year then the one you chose won’t make that much difference.  On the other hand, if you put many of your purchases on your card like we do, then you’ll want to look closely at the amount you charge. 

Some cards, like our Amex Blue Cash, pay out much higher rewards once you’ve crossed an annual spending tier.  Before you reach the tier you earn a lower percentage cash back on your purchases, then once you cross it the amount of the cash rebate goes up considerably.  So compare what you’ve spent in the past on your credit card against any rewards tiers of a card you’re considering.

Other cards have limits on how many rewards you can earn in a month or a year’s time.  For example, the Discover card is great because it pays out 5% cash back on different categories throughout the year.  But it does put a cap on the dollar amount that earns the 5% cash rebate, after you reach the cap you go back to earning 1% cashback on purchases.  Discover publishes the 5% cash rewards schedule every year so compare what you typically spend in a category against the caps.

4) Grocery & Gas Credit Cards

Th reason I asked about groceries and gas purchases is that some of the best cash back cards like Chase Freedom and the True Earnings card have higher cash rebates for those categories of purchases.  For example, one of the spending categories in the Fall for the Freedom card is grocery stores – during which time they pay 5% cash back on groceries.

The Costco True Earnings card gets 3% cash back on the first $3,000 of gas purchases a year, whether you make them at Costco or any gas station, which makes it one of the best gas credit cards out there. So the kinds of things you typically use your credit card for can make a difference in which might be the best card for you. 

For example, I mentioned that we use Blue Cash from American Express that gives higher cash rebates for both gas and supermarket.  We buy a lot of groceries for our family and a considerable amount of gas for my daily commute so it’s a great card for us.  Below’s a snapshot of our rewards part way through last year:

So one tip is to look back at what types of things make up the biggest percentage of your spending and see which, if any, cards offer programs suited to those categories.

5) Comparing Credit Cards

You’ll want to compare credit card benefits if you already have a card, because applying for a credit card and opening new credit lines can have an impact on your credit score.  You want to make sure that the benefits of the new card are worth the implications of adding a new credit line to your credit report.  You also have to think about how many credit cards you already have in your name.  If you have a history of applying for lots of credit cards your credit score could suffer.

So when you compare a new card to your current card be sure you look for one with lower or no credit card fees and better rewards programs & terms than what you already have.  If you sometimes carry a balance then finding a card with a lower interest rate is also important.  Make sure you think about all the factors of the card, not just which one has the biggest new customer bonus or lowest introductory APR.

6) Credit Score Importance

If you have a good credit score then you shouldn’t have a problem being approved for a credit card.  On the other hand, if you have bad credit or no credit history that will have a big impact on which credit cards you qualify for.

If you’re trying to establish credit or re-build your credit you can get a secured credit card or a secured loan to build up a history of regular payments.  If you’ve had issues with payments in the past and have bad credit then it may be best to hold off on getting a new credit card and focus on improving your credit.

Why Check Your Credit Score?
If you’re not sure what your credit score is, you should check it out before applying for a credit card.  When you apply for a card, your application shows up on your credit report.  The credit reporting agencies like Experian, Equifax, and TransUnion will see the credit inquiry and know that you’re looking to increase your access to credit.  If you have a mediocre or bad credit score and apply for a card that requires excellent credit, not only will you be denied for the card, you’ll also have a credit pull showing up and potentially damaging your credit rating further.

Discounted & Free Credit Scores
You can pay to see your FICO score at myFICO, there’s usually some type of myFICO promotion running where you can get a discount.  There are also several ways you can get a free credit score, be aware that all require you to provide your Social Security number.  The site Credit Karma doesn’t provide your FICO score but rather an alternate score calculated by TransUnion at no charge to you.  Another site called Credit Sesame gives you your credit score from Experian when you use their free service.

Credit Score Benefits
The higher your credit score, the better your credit card options will be.  There are some cards that are designed for people with good credit – for example don’t bother applying for Chase Sapphire or the Marriott Rewards card unless you have pretty good credit.  Cards with lots of perks, services, or bonuses like the Platinum Card from American Express or Chase Freedom – $100 Cash Back card also require a really good credit score. 

Best Credit Card Criteria

As I already mentioned, the questions I asked don’t cover every aspect of rating credit cards but they’re definitely a good start.  Depending on your situation there are certainly other things to consider. For example if you’re a business owner like Brigid then there’s the category of business credit cards that are also an option.  Or if you’re in school you can consider, or may be limited to, student credit cards.

Something else I didn’t ask Brigid was about any credit card fees she currently pays.  I did cover fees some but they probably warrant their own section, what kind of charges and fees does a card have and are they worth it to you?

Hopefully this overview helps Brigid and can also help you find the best credit card for your needs.  Good luck credit card hunting!

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Valentines Day Savings Roundup

My wife and I celebrated Valentines early – we actually had a free baby-sitter so we went out for dinner and a movie last night.  We stopped into the neighboring Barnes and Noble for a bit after the movie let out so my wife could skim through some magazines. I tagged along to that part of the store to check out the latest editions of some personal finance magazines.

Since we’ve had kids, I haven’t spent much time perusing magazines at bookstores so it was kind of an overwhelming experience.  I couldn’t believe how many different magazines they sold, on such a variety of topics.  In fact, it took me a while to find the section with Forbes, Kiplingers, Smart Money, etc.   I finally found it, tucked away in the second and third row in the business section.

It seemed kind of strange to that the money magazines (which could help you afford the hobbies & interests represented by the hundreds of other periodicals) were so few and hard to find. I’m sure it’s because most people don’t enjoy reading about personal finance topics like I do, the bookstore sells what people want.

Still, it seems like wierd to me that people wouldn’t want to know more about how to spend, save, and grow their money so they could better afford the things in the categories of Art, Entertainment, Food & Wine, Automotive, Fashion, Electronics, Home & Garden, Sports, Travel, etc.

I did see some headlines about how to save money when celebrating Valentine’s Day, so I thought today I’d share some articles online about the same topic.

Valentine’s Day Savings

• Valentine’s Day Gifts @ Budgeting in the Fun Stuff
• 7 Romantic Frugal Date Ideas @ Couple Money
• Valentine’s Day Restaurant Deal @ My Money Blog
• 5 Frugal Ways to Spend Valentine’s Day @ Generation X Finance
• 3 Frugal Ideas for a Romantic Valentine’s Day @ Invest It Wisely
• Best Cheap Date Ideas for Valentine’s Day Romantics @ The Digerati Life
• Five DIY Valentine’s Day Ideas for Frugal Sweethearts @ Get Rich Slowly
• Valentine’s Day: Impress Your Partner Without Breaking the Bank @ Cool to be Frugal

Personal Finance

• Green Acres 2011 @ Brip Blap
• The War on Debt: The Battle Begins at Home @ Frugal Dad
• The 2010 Tax Deductions You Can’t Claim @ My Dollar Plan

Investing

• Not All Index Funds Are the Same @ Free Money Finance
• Not All Target Date Funds Are Created Equal @ Suns Financial Diary
• A Primer on Exchange-Traded Fund (ETF) Terminology @ Million Dollar Journey

Hope you have a happy Valentine’s Day!

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Best Tax Software

The best tax software for your tax return depends on a variety of factors but the big three of tax prep software (Turbo Tax, Tax Act, and H&R Block at Home) remain some of the best choices this year. They’ve all been around for a while so they have a lot of experience handling new tax rules and finding deductions for their users. If you are planning on filing your taxes online this year, anyone of these services should meet your needs.

Turbo Tax, Tax ACT, and H&R Block offer free filing options to cover the basics and they all offer more sophisticated versions to help you take advantage of tax credits and deductions. Before we get into an overview of their services and what they have to offer, I’ll also mention two additional tax software packages that I’ve heard about recently but haven’t had a chance to evaluate – Citizen Tax and Complete Tax:

Turbo Tax Free e-File

• Free tax file for 1040EZ and other simple returns
• Turn around time for tax return in as little as 8 days if signed up for direct deposit
• Audit Support Center included

If you’re filing needs are simple you might be able to use the Free Edition or the Basic Edition of TurboTax.  If you’re filing the 1040EZ and don’t have a mortgage, childcare or medical expenses, or charitable donations then these might be all you need.  Keep in mind they don’t cover tax schedules C, D, E, or F and don’t include state filing. 

Turbo Tax Deluxe ($29.95) helps you maximize your deductions. Good for people who qualify for a lot of tax deductions such as home owners. State filing is an additional price. – Click Here to Learn More

Turbo Tax Premier ($49.95) helps you with investments and rental property. If you have more than average investments and one or two rental properties, this package takes a look at their tax implications. – Click Here to Learn More

Turbo Tax Home and Business ($74.95) designed for people who own a small business. If you’re dealing with business taxes its smart to hire a CPA but if you don’t then this software is designed for sole proprietors, contractors, or single owner LLC’s.  I know Ben used this package for a year or two before hiring a CPA for business taxes. – Click Here to Learn More

Turbo Tax Business: ($129.95) built for corporations, parnterships, or multi-member LLCs to help file business taxes. Again, it might be wise to hire a CPA rather than trying to do it yourself unless you are very savvy with federal tax returns. I am sure the product is great at helping you identify many deductions, but there are a lot of tax implications to consider when dealing with corporations. – Click Here to Learn More

Tax Act Online

Tax Act is the program I have used for the past three years. I think it’s the best value for people with simple returns, but want help with tax deductions and credits.

Free e-File

• Offered through Tax Act with a tax deduction helper and walk-through videos
• Prepare, print, and e-file federal returns for free
• State filing costs $14.95

Tax Act Deluxe ($9.95) I have purchased this each year, because the extra tax tools included are worth the $10 bucks. State fee is reduced to $8.00. – Click Here to Learn More

Tax Act Ultimate ($17.95) This includes all of the free and premium services, and also it includes your state filing. – Click Here to Learn More

Tax Act Business ($39.95) Tax Act has seperate federal and state editions for business tax forms 1065, 1120S, and 1120. – Click Here to Learn More

H&R Block at Home (formerly Tax Cut)

H&R Block e-File H&R Block at Home has no free e-file that we can see. They offer a basic service for $19.95 that gives you up to 5 federal e-filings. They also allow unlimited free printing for filings. – Click Here to Learn More

H&R Block at Home Basic ($19.95) Gives you 5 free e-files, a state file is an extra $19.95. This package is designed for simple returns, the 1040EZ form. – Click Here to Learn More

H&R Block at Home Deluxe ($44.95) This version is designed for people that need to handle the tax details of owning a home (mortgage interest), selling investments (stocks, bonds mutual funds), or make charitable donations.. – Click Here to Learn More

H&R Block at Home Premium Federal ($64.95) for the self-employed or people that own rental property. It also includes an “Ask a Tax Advisor” session where H&R Block will help answer a tax question via a 1-on-1 phone or e-mail consultation.  For an extra $15 also get state filing. – Click Here to Learn More

Home & Business ($79.95) This version offers includes everything from H&R Block Premium and also addresses business tax needs such as vehicle deductions, depreciation, business expenses, payroll and employer tax forms. Its designed for corporations, S corporations, partnerships,  or LLC’s. – Click Here to Learn More

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Credit Sesame Review

Credit Sesame is a website that can give you a free credit score and find you lower interest rates on your home loan and consumer debt. I first heard about Credit Sesame because of the free credit score they offer but after trying it out discovered that’s only part of their approach to reducing debt.

Lower Interest Debt

Credit Sesame actually uses your credit score and your debt profile to search for loans you could qualify for that would save you money compared to your current loan.  For example, here’s the summary page it gave me after I created my profile and it searched for loans.

I had a chat with someone from Credit Sesame and learned that the loan analysis software the site uses was actually originally built for banks, to help them qualify consumers for loans.  Then the Credit Sesame founders decided to instead open the software up to help consumers find the best loans.  Here’s how they explain it on their site:

“Our founders spent years developing the analytics banks use to make their lending decisions. Drawing on this banking industry expertise, they partnered with Berkeley and Stanford scientists to give you access to bank-level analytics — and help you choose loan options that are right for you.

In just minutes, our patent pending technology builds over 5,000 scenarios and instantly evaluates thousands of loans from all major banks against your personal credit situation.”

There are other services out there that let you search through available loans but the difference with Credit Sesame is that they screen them using your debt profile, so they only find loans that you qualify for and that are at a lower interest rate than what you’re currently paying.

Of course, the whole idea is that with lower interest and lower payments you can pay your debt off faster.

Credit Score & Debts 

In order to use your credit score and your current debt levels in it’s search, you have to create a profile of your financial situation. 

You enter your SSN so Credit Sesame can pull your Experian credit score and validate your credit data. 

Once it’s setup, the software monitors for changes in your credit score and for any new loans that may be available as a result that could save you money. When you signup for the free service you can go the simple route, like I did, and let Credit Sesame pull in all your debt information from your credit report.  You can also manually enter in the principal balance, interest rate, and loan term for your debts.

The software uses the loan information to determine your debt ratio – which they use when screening for other loans. For example, mine found our current mortgage and all our credit cards. 

It also pulls in real estate information from Eppraisal.com if you own a home – the estimated property values do seem a little high.

Free Credit Monitoring?

Most anywhere else you look online you have to pay for your credit score and pay for credit monitoring so of course I aked how Credit Sesame can offer it for free. 

Basically, Credit Sesame’s goal is to find you a loan with a lower interest rate that you qualify for that will save you money on your monthly payments.  If you apply for the loan and are approved, then Credit Sesame gets a refferal fee from the bank – which is why they can offer the credit score and software for free to consumers.

Overall, it seems like a pretty useful tool and gives you a lot of information in a snapshot view about your credit rating and debt.  Even if you don’t end up getting a new loan, it’s a good overview and a free credit score, so check it out – Credit Sesame.

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