Simple Small in January

We've had an exciting first month of the new year!  Take a look at some of our top posts:

• A Smarter Savings Account
• Be Smart with Your Gift Cards
• Reader Story: Overdraft Protection
• Make Your Credit Cards Pay You
• Working Man's Lunch

That's for your support! If you haven't already, join the rapidly growing Simple Small community and subscribe today or get Simple Small delivered directly to your inbox.

Make Sure Your Promotion Makes Cents

Got an opportunity to make big bucks in another city?  Good for you, but be careful before signing the dotted line.  More money does not always mean more purchasing power.  Do your research--you might be surprised!

Stock Your New Computer...Free!

Buying a computer these days is like an a la carte menu...click a button get a wireless keyboard, new software suite, headset, etc. You came into get a new computer and you leave with $2,000+ worth of hardware and software bundles that you're probably never going to use.  Fortunately, there are lots of high-quality software alternatives available out there. Check out some of these before your next computer purchase:

Google Docs is free software as a service alternative to the traditional Microsoft Office Suite.  Currently it offers a word processor, spreadsheet/databases, web forms, presentations, and drawings.  The features are not quite as robust as the Office Suite just yet, but they are rapidly growing.  One of the great things about software as a service is everybody gets all updates, and in this case they're free! No more buying the newest edition every 6 months!  Google Docs also offers unique tools that integrate content from the web into your documents (ie YouTube videos, stocks/stats, data security, etc).  Open Office also provides a free option for folks who still want to download and install something on their machine.  This won't set you back any money and does a pretty darn good job, all things considered.

Pixlr is an extremely powerful web-based photo/graphics editor that competes pretty strongly against the likes of PhotoShop and Paint Shop Pro.  You can make quick edits in seconds without leaving the comfort of your browser.  You don't even need to log-in to use it, so if you haven't tried it check it out.  If you need to download something to put on the desktop, GIMP is an imagine manipulation platform that will give you most of the comfort of PhotoShop. Again, this should cover most of the average Joe's needs, so try it before forking over the big bucks.

Look at that! We just saved $400.  I could go on for pages about all of the different free software there is out there, but usually a Google search of "Free alternative to _______" will help you find a few options.  

What free software tools can you not live without?

Make Your Credit Cards Pay You

If you are a responsible user of credit cards, your credit cards can make you money. Just remember to pay off balances every month. Then find a credit card that has a cash rebate program. You can see your options at BankRate.com or other similar sites. I like the Chase Freedom and the American Express Blue Card, but there are several similar cards, like Discover and Capital One. Once you've got the plastic, use your cash back card for as many purchases as you can. The drawback to these cards is the high interest rate you have to pay if you carry a balance. The Bank is betting that you will slip up, so DON'T. Play by their rules and beat them at their own game. You must pay your balances in full each month!

Another way to make money from your credit cards is to take advantage of the 0% interest balance transfer programs offered by some banks. You must be selective and choose only those offers that have a reasonable upfront charge. If you pay 3% or 4% of your cash withdrawal as an upfront fee, you can't win. So look for offers that have a maximum fee of $50 or $75. These offers are not as widespread as they once were, but they are still available. How do you make money? Look for offers that have an interest free period of at least six months (one year is better) and will let you advance $10,000. Then if you have a Home Equity Line of Credit, pay down that balance and save interest costs there. At the end of the interest free period, withdraw the funds from your HELOC (or another balance transfer program) to pay off the credit card. If you have the funds for a one year period, but don't have a HELOC, invest the money in a  high-yield investment account. Currently, you  invest $10,000 in a 5 year CD at 2.4%. At the end of 12 months, cash in that 5 year CD and pay off the credit card with the proceeds. You will pay a 2 month penalty for cashing the CD early, but you will still earn $200 interest on the bank's money. These numbers will get better as interest rates rise. Even if you paid a $75 fee for the balance transfer, you still have enough profit for 300 pizzas! All you have invested is a few keystrokes.

Thanks, Mr. S for the tip!

$20 Amazon.com Gift Card for $10

Deal repost from livingsocial.com 

What's rarer than spotting a snow leopard, Halley's Comet, and Mark Wahlberg with a shirt on? Answer: Today's once-in-a-lifetime deal. Pay just $10 and get a $20 gift card to use at Amazon.com, the largest online retailer. Whether you are looking for something usual, like a book, or unusual, like a Borat-style mankini, you'll find it among the millions of products listed on the site. Or, if you're hankering for something that really stands out, put your 50%-off gift card toward the revolutionary and bestselling Amazon Kindle device. Just be sure to act fast, because deals like this only happen once in a blue moon.

The Little Details

Limit 1 per person, no gifting allowed

• Amazon.com Gift Card does not expire
• Voucher purchase is valid for US-based customers only
• LivingSocial Terms and Conditions apply
• The Amazon.com terms and conditions set forth below are deal specific terms that supersede any inconsistent terms in the LivingSocial terms and conditions

Buy Now

With no expiration date...this is as good as cash as far as I'm concerned.

Don't pay for an advance on your tax refund

It's that time of year when a lot of us are planning our taxes and, hopefully, estimating how big of a tax refund is coming our way.  Though I'm always one to encourage you to learn to do your own taxes, it's completely understandable that a lot of folks find tremendous value in having somebody else do them.  We've all got busy lives--it's completely understandable.  
What I don't support is getting a cash advance from your tax services company, in lieu of waiting 6-8 weeks for the IRS to send you a check.  Most of them will offer to give you a cash refund in 24 hours for a small $50 administrative fee and then some charge on top of that.  These costs end up totaling $100-$300 and sometimes more.
Just for the sake of simple calculation, let's say your total refund is $1,000, and your advance fee total is $100.  You're getting charged 10% interest for a 6-8 week loan.  That's 60% annually, and a big no-no.  These guys are not doing you any favors by giving you an advance...they're taking your hard earned money!  My recommendation would be to go ahead and get your taxes done early. That way you can get a refund check from the IRS early and move on with your life.  

Take a small amount of the refund and treat yourself to something simple, but try to save as much of that refund as you can and start thinking about next years deductions.

A smarter savings account

A lot of folks use a checking account to handle the day-to-day cash flow and use a savings account to accumulate wealth and generate interest.  Unfortunately savings rates these days are trivial...oftentimes lower than 1%.  The alternative might be to put the money in a mutual fund, money market account, or a certificate of deposit...something a little less accessible.  Most folks don't like this option as their savings are also their 'rainy day' fund.  If you're one of those folks, here's how to keep your money close while getting a better interest rate:

Ally Bank's high-yield CDs have terms from 3-months to 5-years.  What catches my attention is the 5-yr 2.39% APY account (rates in the post as of 1/15/2011).  Though 2.39% may not seem great for such a long term, it is steady, reliable, and it's better than the 0.3% you're making now...7 times better, in fact!  I know, nobody wants to tie their money up for such a long time period...well here's the deal:

Ally's CD early termination policy is 60 days of interest...that's it.  If you're confident you can keep your money in there for longer than two months, it's probably worth considering.  If you can keep it in there for 12-months, you're netting a 2% return (much nicer than the 1.29%; 1-yr CD).  For a lot of folks...the 'rainy day' never comes, and money sits in these low-yielding savings accounts for years.  That could be hundreds or thousands of dollars lost over the years!  Consider a high-yield CD with a simple, low-cost early termination penalty.

Ally's just one option. Visit www.bankrate.com to compare current market rates. Do your homework, and don't be afraid to call and have a customer service rep explain the details of your new account.

Moving forward...keep an eye on your accounts and current market rates.  If 12 months from now you can get a 4% CD, it might be worth moving your money around again. You are in charge of your money.  Don't let rain day fears keep you from earning interest on money...get a smarter savings account today!

Working man's lunch

I'm always giving guys at work a lot of grief about going out to lunch every day...it downright expensive.  


This week I went to the store and bought $3 worth of bread, $6 worth of meat/cheese, $1 worth of bananas, and $2 on veggies/toppings.  Monday morning I made 5 sandwiches and put 4 in the fridge.  That's my 5 lunches for the week...only $12.


I used to feel like it was easy to get a $5 lunch at a restaurant, but lately I've seen prices $9-$10, plus tax/tip. Either way.  If you eat out every day at an average of $7/day, you're spending $23 more each week than me.  


A couple of dollars each day easily adds up to $1,000+ each year.  Not to mention, I know what I'm preparing is healthy--an investment I'm sure will pay off in my old-age.  Whether you're a freshman in college or years away from retirement, there's no reason not to consider adding 'making your lunch every day' as a late New Year's Resolution.


How do you make lunch on the cheap?

Reader Story - Overdraft Protection

I got a e-mail this week from one of our readers, Will.  He was devastated having recently discovered $400 in over-draft fees on his checking account.  An all too common story...he thought he had an automated transfer set up to avoid this type of situation.  Instead his account hit zero, and soon even a cup of coffee was costing him $20!

My advise was fourfold:

1. Get money in that account NOW! Maybe a given, but the last thing he needs at this point is more fees.  You don't want the bank to have any reason to hold this accident against you.  Give them there money back and double check all of the automated transfer settings to make sure this doesn't happen again.
2. Go to your local branch and discuss the situation with a customer relations manager. If your overdraft was a simple & uncommon mistake, usually the personal touch will get you some or all of your money back.  It's more important to the banks that they keep you happy so that you stay a long-term customer, rather than hoarding these type of fees.  If it was clearly an accident an isn't an everyday occurrence, be persistent and insist on your money back.  I'd be well-prepared to put my money elsewhere if they didn't offer me anything back on that $400.
3. Start shopping around for a new bank account.  Many banks offer free overdraft protection.  Find a bank that has a plan that is better suited to you.
4. Set up alerts!  If your bank won't notify you that you're about to overdraft, then sign up for a free service like www.mint.com.  Mint will send e-mail or cell phone alerts letting you know before something becomes a problem.

Reluctantly, Will went into his bank, and they greeted him kindly.  Not only did they refund him $200 and changed his fee structure to $0.99/overdraft, they also ran a free credit check and gave him some long-term strategies for improving his credit. Let your bank work for you, and develop a relationship at your local branch.  

What's your over-draft horror story?

Take Your Energy Bills Seriously

The Department of Energy and Environmental Protection Agency estimate that the average U.S. household spends $2,200/yr on energy. With rising energy costs looming, it makes sense to keep an eye on how you're using energy. Here's how most homes use energy:

In the spirit of getting our bills down, I'll be writing regularly about things you can do to cut costs at home.  Today we'll start with heating and cooling since they are the big culprits.

I recently bought a programmable thermostat from my local hardware store for less than $30. I'll preface this by saying I'm not very handy...just determined.  I followed the directions and had it replaced in under an hour.  My unit had energy star settings pre-programmed; all I had to do was enter in my normal work schedule.  $25 and an hour later, I'm on my way to $180 savings per year. That's a 700% return, annually!

Some other easy ways to save big on your heating and cooling bills are to air seal, duct seal, and insulate. Many older houses allow hot and cold air to freely enter & leave your conditioned living space. Not only are you losing the warm or cold air you already paid for, it's also less comfortable.  Many states, local municipalities, and utility providers have incentives to make this more cost effective. Like always, don't pull the trigger until you've done your research.  Try calling your local government and your utilities to see what they're offering. Another good starting point is the Database of State Incentives for Renewable Energy.  If you can do-it-yourself, you might save some money. There are plenty resources available on-line or at your local hardware store.

Smart Wallet to Keep you from Spending

The NYTimes reports that we could see smart wallets in the near future that actually make it harder for you to pull out cash and spend money.  The research behind the new product suggests that budgets are too complicated to actually work:

"The easiest way to set up a system, experts suggest, is to put your income into separate accounts or subaccounts, including one that distinguishes spending money from money needed for recurring household expenses. And think about working backward, as a way to keep things simple: instead of setting up an overly detailed budget, first decide how much you want to save for retirement and other goals, then work with what's left over. If you want to cut spending, attack a few big categories where you can make the biggest difference."

The anticipated retail is going to be a whopping $60!  Would you spend to cash to get a slap on the wrist when you're close to spending too much money?

Original Article:New York Times

Be Smart with Your Gift Cards

What if you opened up a Christmas present and found an invoice to Best Buy? I'm guessing you'd be pretty upset.  We'll if you're not smart about your gift cards, then you might be getting just that.

Let say that if you get a gift card to a store that you're going to go shopping at any way, then great! You're friend, family, or whoever sure knows you right.  Unfortunately, it never seems to be the case...(Mom's are awful about this).  

So what to do with those gift cards to places you don't love:

Sell 'em!

Cash always beats a gift card...you can spend it on whatever you want, or if you're like me, put it in the bank.There are some really great websites these days that will buy second-hand gift cards and resell them at a discount to people who want them.  These sites are becoming more common, so just be careful that you're dealing with a reputable company.  Plastic Jungle and Gift Card Rescue are great places to get started.  Cardpool is another that's been in the press lately.  Of course you might be able to get a better price on Craigslist or Ebay, but you may have a bit of a hassle finding an immediate buyer.  Put some cash in your pocket instead of ever stepping a foot into a store you don't give two hoots about!

Use your Cards Wisely...

Not getting enough bang for your buck selling your gift cards?  Maybe you kind-of like the store that you've got $20 to?  Well, whatever your reason, if you end up shopping for something with your gift card, be smart!  Your budget for your trip to the store should be the amount on your card.  Don't go in and buy a $100 outfit with your $20 gift card cause now you're out $80.  Remember...somebody gave you something, and it wasn't a bill.  Don't turn it into one.  Get something within your budget and get out.  

Give it to a Charity

Got a favorite 501(c)3 that could use your office supplies card?  It's not too early to be thinking about your 2011 tax deductions.  Get a receipt and write it off! 

What's the most a gift card you received as a present has cost you?

Edit 1/5/11: I just learned about ScripSmart, a neat site that helps you track your gift cards, read and understand the fine print, and receive alerts when they're about to expire.  If everybody and their mother gave you a gift card this year, it may be worth signing up.