Reducing The Cable Bill Part I: HDTV
The following is a reprint of a post that I made from my old blog Getting Out Of The Poorhouse: To find out why, see here.
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I love TV, I love the internet. I love HDTV, I love broadband. I love them so much I throw a ridiculous sum at them every month, $140.65 to be exact. That’s $1687.8 a year! But do I really need it? No. Since knowing is half the battle, here is what I did with the other half:
Part I: HDTV
Since I’ve turned over a new leaf and decided that brash consumerism (and the negative effect on your bottom line) was not for me, it became alarmingly apparent that $97.7 a month to watch TV is just not conducive to saving. Especially if out of the 500 or so channels that I receive, only 20 are actually in HD and 6 of those are the only ones I watch (which happened to be the local channels - ABC, NBC, CBS, FOX, The CW, and PBS).
So why did I pay for it in the first place? It was an amalgamation of creative advertising (being lied to), freebies, and me being an idiot 
When I first got my HDTV I was told that the only way to get HD programming was to pay for it (i.e. cable and/or satellite). Second they threw in a ‘free’ ($5.99/month) DVR(Digital VIdeo Recorder) to record my shows. And third you can only get those HD channels by signing up for their upper tier packages - i.e. pay for 500 channels to watch the handful that you want (You got to love the cable TV business model though:) But since I’m now an advocate of frugality and saving - here are some of the happy discoveries that I’ve made:
1. You can get HDTV for free: All you need is a pair of rabbit ears, turns out my HDTV has an OTA (over the air digital tuner) HD tuner (biggest difference between an HDTV and an HD ready monitor). All I had to do was connect the antenna, do a channel scan and boom! 23 crystal clear digital stations found - including the local channels in HD. Yay!
2. Miss a show and don’t have a DVR? No problem: One of the bigger selling points for having an HD cable subscription was having a DVR to schedule and record shows when I’m not around the house to watch them live (time shifting). However local networks have since started streaming their shows on their websites a day after they originally air. The majority are in HD quality too (Lost at abc.com for example).
3. How about movies in HD? Try Netflix: I’ve been a Netflix user for about 6 months now and it’s great. They have a huge selection of high-def movies in Blu-Ray (and HD-DVD when they still offered it 
This deserves it’s own post). I signed up for the 3 at a time plan for $18.95. You make up a queue of movies and TV shows you want to watch and they send you the ones on the top of the list. It’s convenient and the turnaround time is decent. But the biggest advantage is their “Watch Now” feature. Like the TV streaming from the network stations, Netflix also does this, with a pretty impressive catalog to boot. New movies and shows are added every day with DVD (if not better) quality.
Armed with this knowledge, I’ve packed up my cable DVR and drove up to the local cable branch to return it and cancel my HD cable package. Opting to downgrade to the most basic package of $15 for local (Non-HD) access to retain my broadband internet discount.
What I use to pay for TV: $97.7
Now: $15 for basic cable + 18.95 Netflix = $33.95
Savings: $63.75 a month or $765 a year. All of which I plan to pay down my debt with
Tomorrow, Part II - Broadband Internet.
Want to Save Money? Don’t Buy the Sunday Paper
The following is a reprint of a post that I made from my old blog Getting Out Of The Poorhouse: To find out why, see here.
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Can’t get by without the paper? Fine. At least don’t look at the ads. Best Buy, Circuit City, CompUSA(RIP). These were the things that I looked forward to in the Sunday paper. I was not interested in the weather. The comics were nice, but those could always wait. Never mind what was going on in my neck of the woods, much less the world, the ads had to be looked at first. Sunday morning @ 9am sharp I would fetch the paper from the driveway, plop it up on the kitchen table, and proceed to dismantle the thing until I found those precious Sunday ads.
The biggest store specials always belonged in the first page. Inventory that needed to be cleared to make room for newer models usually shows up in the last page. Everything else laid in between. I would quickly skim thru the pages then make mental notes of the things that catch my fancy then go back and go over those items in greater detail. Inevitably some things will stand out and stay with me for the rest of the day. Then the wanting starts. I try to forget about it but I can’t. Try to pre-occupy myself with something else but it doesn’t work. I try to talk myself out of it, but by then it is too late. The fascinating process of convincing myself has already begun and anything that I try to do or say only reinforces how bad I want it and make me act on it and buy it now!
That my friends is what you call getting worked up in a lather ^_^ How worked up? I’ve once blown over 6 grand in a weekend due to these ads. Say what you will about them (I know I have), they sure are effective though.
The glossy paper, the vivid colors, the pretty pictures. All designed to grab your attention and fill your mind with possibilities. While some are more susceptible(raises hand) than others, everyone who looks at the ads usually sees something they like and is given that subtle “push” to at least think about it, if not act on it outright(again raises his hand). That is the power of advertising.
Now I’m not saying that advertising is bad. I plan on putting up ads on the site in the future to help keep it running, and maybe a add a little coin in my pocket :) I’m just saying that if you’re a raging consumerist like I was(still a work in progress), and would like to lay off the ’sauce’, avoiding the ads is one of the little things that you can do to help turn things around. You know what they say about the little things - they add up.
As for me, I’ve realized that it was a problem and admitted as such. It’s been a difficult road but I can confidently say that Ive been clean and sober of the Sunday paper for almost 2 years now. If I can do it, anybody can.
So what does one do to kick the Sunday paper ads habit? Lots!
-Don’t buy the Sunday paper. I know it sounds really simple but it works! No Sunday paper, no ads! No ads, no temptation to spend!
-Only look at the coupons: Keep in mind coupons are only good when you use them for things you actually need. Don’t use them just for the sake of using them.
-Go to church: Pray for the strength to resist looking at those ads. And for world peace of course.
-Actually read the news once in a while: Wait a minute, the governor of California is who again!?!?
-Go jogging: Get healthy, exercise. A nice 30 minute fun run is better than sitting on the couch ogling at the new 7.1 channel, DTS-HD decoding, HDMI v1.3, 1080p upconverting, multi-room capable, XM-Satellite ready, THX-certified AV receiver.
-Don’t buy the Sunday paper: I said it before and I’ll say it again. You don’t want to keep feeding the monster with the foods it likes to eat
-Clean the house and throw away the ads: Idle hands are the devils playground. Kill two birds with one stone. A man’s house is his castle. A bird in the hand is worth two in the bush. A fool and his money are soon parted. A rolling stone gathers no moss…
-Get a dog: Although this seems counter-intuitive to the above tip, according to my sister it is really effective. She says having a dog is akin to having a shredding machine. An indescriminant, noisy, slobbering, leg-humping, pooping, shredding machine.
And finally -
-Don’t buy the Sunday paper: Have I mentioned this already? At $1 a week, $52 dollars a year, in 30 years at 8% compounded monthly, taxed 25% annually amounts to $4,278. Like I said: Want to save money? Don’t buy the Sunday paper.
What do you guys think?
Weekend Project…Light Bulb replacement.
The following is a reprint of a post that I made from my old blog Getting Out Of The Poorhouse: To find out why, see here.
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Pay of debt. Save money. Reduce your expenses. Seeming as I’m probably the last pf blogger on the planet that still uses regular light bulbs, I felt it was time to walk the talk and practice what I preach. So for my weekend project, I decided to replace my regular bulbs with those energy efficient CFL’s.
I counted and found 45 light bulbs in my house with an average wattage of 65 watts. Went to Costco and looked for some equivalent CFL’s. Found some that were comparable to my regular 65 watt bulbs that only used 15 watts a bulb for $9.88 for a pack of six. I bought 8, total cost: $85.83.
Went back to the house and replaced the bulbs and tested them. Not bad, they actually seem to be brighter than my old bulbs after warming up.
Afterwards I found this energy savings calculator from GE and plugged in put in the number of bulbs replaced and hit calculate. Here are the results:
Annual savings: $328.50
Savings over the life of the bulb: $1800 (In 5 and a half years at an average use of 4 hours a day.)
That’s awesome. That’s like ivesting $86 and turning it into $1800 in 5 and a half years. That equates to a rate of return of 56.59% compounded monthly! Now if only we can find another investment that has comparable returns
Not sure if CFL’s are right for you? Check out Llama Money’s article on 6 Myths about CFL.
What are your experiences with CFL’s?
What can you do with $5000 a Second?
The following is a reprint of a post that I made from my old blog Getting Out Of The Poorhouse: To find out why, see here.
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Stumbled upon this interesting site that is detailing the cost of the war in Iraq. Using my own ’scientific’ method of counting (One Mississippi…Two Mississippi) the war in Iraq costs approximately $5000 a second. Along with the costs estimator, the site also has some pretty neat calculators to determine what the money could buy instead. How much money are we talking about here? For example, with the money spent in the war, 153,995,332 people can have healthcare. According to the US Census Bureau, 45.8 million people in the US are without health insurance as of 2004.
That’s pretty nifty and all, but the title of this post is, ‘What can you do with $5000 a Second?’ Examples of what I would do If I made 5K a second:
Pay of my student loans in 5 seconds
Pay off my mortgage in 34 seconds.
Buy a Lamborghini in 45 seconds.
Buy this yacht in 80 minutes.
Dock my yacht in this mansion in 5 hours.
Buy an F-22 Raptor in 19 hours.
Park the Raptor on USS George H.W. Bush in 10 and a half days
And much more!
That’s the beauty of making $5000 a second. Eveytime you think of something to do with the money - enough time has probably elapsed for you to afford it
What about you guys?
Money Blunders…TV Edition
The following is a reprint of a post that I made from my old blog Getting Out Of The Poorhouse: To find out why, see here.
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If you’ve read my post about my goals for the next 12 months, you
would’ve noticed my fondness for HDTV and that I pay for both cable and satellite(obviously this needs to change, and it will). Now besides the $160 plus that I pay every month just to get an HD signal, how about the upfront costs?
In 2005, a week after I moved in to my house I had a modest 12×15 living room that was empty. Never mind that the rest of the house was empty too, this was the first place that I was going to furnish. I’d use a cardboard box as a dining room table if I had to (Unfortunately I didn’t, thanks sis!) So I went ahead and started scanning the Sunday ads that week for good ‘deals’ to furnish my soon to be home theater and here is what I found.
Zenith 50 inch plasma TV: $2999.99
Onkyo 7.1 audio video receiver: $869.99
JBL 5.1 speaker set: $239.99
Upconverting DVD Player: $150.99
Monster HT Surge Protector: $109.99
Monster Premium HDMI Cable: $114 x2 cables = $228
Monster Speaker Wire: $79
Grand total plux tax: $5073.23
Did I have $5073.23 laying around? Nope. But it was ok because the store was offering no interest for 36 months on all electronic purchases $399 and up, problem solved. All I had to do was apply for the store credit card, fill out a bunch of papers and I was the proud owner of a kick ass home theater system.
But wait - I have to protect my ‘investment’. I had to get the extended warranty for peace of mind. All for the low, low price of $750 for 3 years. No problem. Plus delivery of items to my house next day with basic installation for just an additional $199.
New total: $6022.23
All of this stuff for only $167 a month for 36 months? What a deal!
Six months later, the same TV was being sold for $1999. The receiver for $399, the speakers for $149, and the dvd player for $79. The Monster Brand accesories had generic equivalents that could’ve been bought online for the following prices:
Surge protector: $60
HDMI cable: $12 x2 cables = $24
Speaker wire: $30
Total+tax: $2971.53
In the 3 years that I’ve owned this setup nothing broke. So in essence I could’ve saved an additional $750. Plus my sister has a big truck so I could’ve used it to haul my purchases home and took my time to set everything up and I could’ve saved an additional $199.
So total saved if I had waited 6 months and looked online? $3050.7, which I could’ve used to pay my student loans with. Also the same $3057 invested at a rate of 8% compounded monthly and taxed annually at 25% would be worth $18,668 in 30 years. Lessons learned:
-It’s OK to wait. That shiny and new gadget/gizmo/doo-dad will still be shinny and new six months later - only it’ll cost less to own!
-Extended warranties from big-box stores are a joke. This actually deserves it’s own post, I’ll post on this extensively in the future. Basically, with regular use, problems with electronics SHOULD show up within the first six months. And if it does, it SHOULD be covered by the manufacturers 1 year warranty(Disclaimer: The preceding statements are not meant as an all encompassing generalization. I know everyone’s situation is different. I know your mileage may vary. That’s why the word ’should’ is in bold and capital letters. Please do not flame me . End Disclaimer). If you really want to get an extended warranty - try to get it from the manufacturer directly.
-If you have access to a flatbed truck or an SUV, it’ll be cheaper to haul your booty back to you place. have a friend help, buy them lunch or promise to return the favor in the future. And in addition…
-Install it yourself. Make it an activity with friends and family. Sure some things are a little more complicated like hangning a flat screen on a wall and running cables behind it and may need professional installation. But placing a TV on a stand and connecting wires isn’t rocket science 
-Check online. Monoprice.com has been a happy discovery for me. No you won’t find ‘premium’ Monster brand cables here. But they have good quality and work just as good. And they are cost a LOT less.
-Was this a want or a need? Goes without saying, right?
What do you guys think?
Introducing Money Blunders.
The following is a reprint of a post that I made from my old blog Getting Out Of The Poorhouse: To find out why, see here.
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What are money blunders? These are tales of financial short-sightedness on my part where I could’ve made different choices that would’ve made a huge difference in my bottom line. They range anywhere from, “Whew, that was close!” to “You idiot! Even a moron would know that’s just stupid.” While certainly not my finest moments, they sure make for entertaining reading. And they are lessons learned indeed. There will be a new one every so often, stay tuned, the first one is just around the corner
My Financial Goals for the Next 12 Months
The following is a reprint of a post that I made from my old blog Getting Out Of The Poorhouse. To find out why, see here.
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Time to get started. The following is a list of goals that I would like to accomplish within the next year. I understand it’s what financially responsible adults would do :) The following is a rough draft, I’m sure I’m going to make changes and add to this later.
Goal number 1: Start an emergency fund of $1000.
I got this idea from PF bloggers who’ve read Dave Ramsay’s Total Money Makeover book. Seems like a good idea since I have an extra $1000 lying around. I’ve only had a checking account until recently when I decided it’s time to grow up and get a savings account. I’ve opened up a Wamu online savings account (www.wamu.com). It’s got a decent interest rate of about 3.30% APY but you have to have a checking account linked to it to get the rate so I opened one up with them as well. Good thing we have a branch close to the house and it only took me 20 minutes to open the checking account and an additional 10 minutes to open the online savings (Less than 7 minutes according to their site but I type slow.)
Goal number 2: Contribute enough to the company retirement plan to get the full match.
I’ve been with my current employer for 3 years now and have just recently started to contribute to my retirement account. Since new employees need to wait 1 year before they can contribute to the retirement plan, I’ve essentially wasted 2 years of free money(Hangs head in shame). Plus I’ve wasted 24 months of compound interest (Hangs head lower). I also missed out on tax benefits since they take out the money pre-tax, it lowers the adjusted gross income (Hangs head even lower, hits desk).
Goal number 3: Track expenses and make a budget.
I’ve listed my monthly bills and expenses in a spreadsheet and I must say that it really is helpful to see where the money goes. Case in point - I pay $161.94 monthly for TV (HD Cable and Satellite). Clearly this is an example of a want versus a need. And looking down at the list I see many wants. The bad news is it’s going to hurt, at least initially, to say goodbye to these things. The good news is I’ll have a lot more money to throw at goal number 4. Speaking of which…
Goal number 4: Pay down my debt
I have about $25,000 in student loan debt. Last year half of it is at a decent interest rate (4.75% government loan) while the other half is private loan with a variable interest rate (anywhere from 7-8.75%, yikes!) I thought about refinancing the private loan but the rates I’ve been quoted aren’t that much better. So the plan is to pay the minimum amount required in the government loan and throw everything else at the private loan. My goal is to pay off the private loan in 12 months. This is where goal number 3 should help out a lot. Even so, that may not be enough. So thinking a little more I introduce you to…
Goal number 5: Make more money.
Anyone have any ideas? I had a few but can’t seem to recall them at the moment as my head is hurting from hitting it on the desk. I’m going to ice it and lay down for a while. Until next time
Tax Time - Out of Sight, Out of Mind.
Before I turned over a new leaf I used to put off filing my taxes for as long as possible. Then making a mad dash on April 15 or whenever the deadline happens to fall on that year. After a frenzied day of getting everything organized, itemized and printesized (not a real word but it should), I’d top it off by going to the post office and waiting in a LONG line to get my taxes sent (It’s like waiting in line for Green Day tickets only the people in line are sober instead of drunk and/or stoned). The I go home exhausted but happy knowing that I have 364 days before I had to go through this hell again.
In developing healthy finance habits, I decided that tax time was not a day of reckoning that needs to be put postponed as long as possible - rather a regular task like any other that can be taken cared of quite easily. I’ve broken it up to into 5 parts:
Step 1 - Gathered my W-2 and all other tax related documents: These included forms that detailed interest I paid in my mortgage loans, student loans, etc.. If I didn’t get them yet I’d sign on to the company website and print it off from there.
Step 2 - Use tax software: It’s a lot cheaper than going to the accountant (provided you have a relatively simple tax situation) and it should be updated with all the tax changes for that filing year. Plus it beats those clunky tax workbooks.
Step 3 - File Federal Taxes electronically thru the software. For a fee, you can choose to file your taxes electronically within the software. You have an option of paying via credit card or have the fee deducted from your tax refund if you have one that year. It’s secure and makes sure the IRS gets your taxes quickly and reduces the turn around time in processing your return(i.e. shorter wait time for a refund).
Step 4 - File state taxes online at your state website: E-file is a great service that’s often underutilized. It’s like a stripped down version of tax software that’s convenient, easy to use and FREE! Just go to your state website and look for the online services tab and it should be under taxes.
Step 5 - Use direct deposit: Instead of 6-8 weeks to get your refund, you get it in about 2. Not only will you get your refund faster, you won’t run the chance of it getting lost in the mail.
And that’s it. I’ve been doing my taxes this way for the last 2 years and it’s been great. This year I’ve filled my return February 1st and received my state refund in my bank account on February 12 and my Federal refund on February 15. And since I’ve filled electronically, I should get my economic stimulus payment via direct deposit as well.
And there you have it. tax time is no longer a day of strife for this guy. And since I filled early, tax time is just another nice day in the middle of April.
Thanks for reading.
What’s In A Name?
www.gettingoutofthepoorhouse.com
Ever heard of it? I have. How? Because I made it. The vision and goal if very similar to Finance Habits. The difference? Finance Habits is easy to remember, Getting Out Of The Poor House? Not so much.
Here is a link from Daily Blog Tips talking about characteristics of good domain names. The things that stuck out for me are the following:
1. Getting Out Of The Poor House is too long: At 24 letters and 6 words, it doesn’t really roll of the tongue.
2. It’s hard to remember: Is it get out of the poor house? Get out from under the poorhouse? Or something else?
3. It’s easy to misspell. It’s hilarious how easy even for me to misspell my own website when I type it in the address bar of my browser. If I’m having a hard time having a go of it - think about what other people are going to go through.
4. Doesn’t have the same ring to it as finance habits
So today I closed the doors on www.gettingoutofthepoorhouse.com and moved all the posts from that site to here. As a tribute to my first blog - I’ll put a loving commemoration in the beginning of every article re-posted from that site.
How Long Does It Take To Unlearn Bad Financial Habits?
How Long Does It Take To Unlearn Bad Financial Habits? I guess I should have named the site UnlearnBadFinanancialHabits.com but that would just be too long. But anyway I digress. Just type in the the above post title in Google and it will show a ton of pages telling you exactly how to do so. Many methods are described with differing time frames promising the same thing. Do this list, perform number 1, then 2, then 3, etc., etc.. Then when you get to the end - poof! Problem solved. That would be great and all- if we were all robots.
The mind is very resistant to change especially if it has been repeatedly shown the same process over and over again. See something fancy in the store? Need to buy it. Don’t have the money for it? That’s fine - use the credit card. Can’t pay off the balance? No problem - Just pay the minimum every month-as long as payments are sent monthly it’ll be OK. Credit card maxed out? Apply for a new one. Oh look! Another fancy toy/gizmo/appliance at the store…you get deeper in the hole, unhealthy financial habits are reinforced, the cycle repeats itself. The cycle of bad financial habits. Which is why I believe “unlearning” something as ingrained into your subconscious can’t be done in a week, a month, or even a year. Especially if these behaviors are all you’ve ever known. So what is one to do?
You learn alternative habits of course. And when you do, substitute it for the unhealthy ones. For example, if you like going out to the movies and eating out every Friday night, rent a movie and cook dinner at home. If you like browsing the ads on the Sunday paper to look for “deals”. Clip coupons instead(Don’t clip coupons just for the sake of it of course. Do it for the items that you actually need.) Like playing the lottery every week? Read a book from the library instead. See something you like that you would like to get? Don’t buy it outright, think about it first, wait a few days and then revisit it.
Sounds simple doesn’t it? It is. The idea is to give your brain an alternative to what it is used to. This way you don’t go into auto-pilot. In the beginning you need to make a concentrated effort to follow your alternative habits. When faced with a decision - you’ll initially try to resolve it with your auto-pilot responses (Wanting a new ipod because it has more hard drive space). Don’t. Instead, take a deep breath, think about it and find an alternative solution (remove songs from your ipod that you don’t listen to anymore to free up hard drive space.) With time, the more these alternative habits are used, it starts to take precedence in your decision making process. Eventually they become the norm, and you’ll wonder how in the world you did the things you used to do
Thanks for reading.