Make Your Purchase And Savings Plans For 2011

Tip #280 - Make Your Purchase And Savings Plans For 2011. As 2010 is drawing to a close, it is time to start setting up your financial plan for 2011. I believe first you should come up with some general ideas of what new expenses you think you will incur in the next year, what big purchases you would like to make, and how much new savings you want to put away. These would generally be for things that were not included in your last year's budget. For example, if you are used to putting $300 per month toward home maintenance, you do not need to add this. However, if you want to add a new deck to your house, put in down on your list. During the next few weeks you can then make a formal financial plan and budget. For now, pull out a sheet of paper, and write down your general plans for next year.

Here is what a sample plan might look like:

Plans for 2011

1. Buy new dishwasher - $500
2. Preschool for son in the fall - $1200
3. Redo middle daughter's bedroom including furniture - $3000
4. Save toward older daughter's wedding - $2000
5. Start an IRA for wife - $5000
6. Put money to youngest son's ESA plan - $2000
7. Start a beach vacation fund: $600

Now that you have your new plans for next year written down, your next step will be to create a formal financial plan and set up a budget based on expected 2011 income. Both of these links are what I wrote about this topic last year, but frankly the ideas don't change from year to year, only the amount that we put in them do. This year I added this additional step of writing down your new expenses and savings as a way to get you thinking of where this money will come from when you start your formal budget. Either other line items need to come down, you need to make more income, or you need to revise your plans (decorate your daughter's room with furniture from Craigslist, for example, so the amount is only $1000 versus $3000).

Doing a simple exercise like this also starts you thinking about next year's finances and gets the ball rolling to write up your formal financial plan and budget. So why not come up with your list?

In Real Life (IRL) - Over the past few weeks I've been thinking about expenses and savings for next year. What prompted it initially was a trip to Philadelphia for my friend's daughter's Bat Mitzvah. I always knew we would have this expense down the road with our children. But the road is getting shorter now that my oldest turned 9 in November. And the reality hit home when I attended the Bat Mitzvah - a DJ, cha-ching, flowers, cha-ching, clothing, cha-ching, lunch for 100+ people, cha-ching. I am not one to go overboard with events, but even with a simple affair, Bar- and Bat-Mitzvahs cost in the thousands of dollars. And we haven't started saving a dime for it yet!

So the first thing on my list for next year's expenses is starting a fund for daughter #1's Bat Mitzvah. I haven't yet come up with an estimated amount (I think I'm scared to figure it out). But off the top of my head I'm guessing we will need about $15,000 so $3000-$4000 might be a good amount to save next year for a 2014 Bat-Mitzvah.

Next on my list is joining a synagogue. Right now we belong to one but it is not really an ideal fit for us. We went synagogue shopping in the fall but put off joining since we were unsure if we'd even be living here in a year. The good news is my husband's boss told him the plans to close the office have been pushed off a few years (YAY!). That means it's time to join a synagogue where we really fit in. We're going to wait until the summer since my girls' Hebrew school is paid off through the rest of the school year. Anyway, the cost of a synagogue for a year including Hebrew School is about $4000-$5000. Ouch! Gosh between Bat-Mitzvahs and synagogue membership, being Jewish is not cheap.

Our last big expense that we might have for next year is braces. The dentist told my daughter that she needs to visit an orthodontist for a consultation. We don't know whether that will result in her getting braces yet - I hope not! - but we know it's an eventual expense anyway. We're hopeful that the costs are spread out over a few years. Plus we have expanded dental insurance that should cover some of the costs, so I am estimating a $600 cost to us next year. Hopefully, that will be put off, though.

Oh, and one more thing, we really need to start saving for another car. Our van is pushing 150,000 miles, and we've been having work done on it more frequently. And it runs fine, knock wood. But we know it's only a matter of time before we will not be comfortable driving that thing to Florida. I hope we can hold on to it for 3 to 4 more years, but only time will tell. We really should be putting a couple thousand towards saving for it per year. Oy.

Just glancing at my list above tells me we will need to bring in about $10,000 more in income to fund these new goals. All this leads me to finding a job in 2011 as my husband's job has a pay raise freeze, so the money won't be coming from there. And I don't believe our other expenses will be going down by much. I've been talking getting a job for a long time, and I was hoping to go back to my old job this past fall, but that did not pan out. Ebay selling is going very well, but there is only so much I can make that way. I can make much more somewhere else. I have something in mind, but it might not happen until spring or summer. After the holidays I will pursue that path. In the meantime, we have a couple more weeks to formalize our financial plan and write up a budget. I hope you will do it, too. Happy planning! For other financial ideas check out Frugal Friday.

Buy Batteries Online

Tip #279 - Buy Batteries Online. This doesn't sound like a money-saving tip that will get you rich. But, if your life is filled with digital cameras, MP3 players, books that play music, video cameras, or any other electronic or toy that takes batteries other than the usual AA batteries, it's so worth it to check out eBay.

If you need a button-cell battery or one for your cell phone, head on over to Radio Shack and price the battery. Then log on to eBay and you may find that the battery prices are 1/10 of Radio Shack's prices. Usually on eBay, the batteries are coming from Asia, and you may have to wait a week or two to get them. So, it's best to order them in advance of needing them. I'm not busting on Radio Shack, that just seems to be the most popular place to go to for batteries. But eBay will likely beat other stores' prices, too.

Again, it may not make you wealthy, but with all of the "toys" (adults' and children's alike) that many people have today, the cost of batteries is not inconsequential. Sometimes it's the small things that add up that prevent people from building up wealth, and the cost of batteries would fall into that small things category that people don't give much thought about, but does affect one's bottom line.

In Real Life (IRL) - Several years ago, my daughter had a toy that took a certain button cell battery. We have a Radio Shack within walking distance of our home, and my husband walked up there and priced the battery. He came back and said the cost was $9 for the battery. Ouch. I don't think the toy was worth $9. Then we looked on eBay. For under $2 including shipping, my husband ordered a whole pack of button cell batteries - about 20 of them! Over time we have used most of them for various electronic toys. Had we continued to buy them at Radio Shack, the cost to us would have been over $100! Although, I'm pretty sure we would have gotten rid of some of the toys rather than pay for overpriced batteries.

Over the years, eBay has been the go-to place for these types of batteries. Recently, my husband needed a battery for an electronic do-dad of his. I don't know why, but again he went over to Radio Shack to price the batteries. The cost was $15. Again, he came home and checked eBay. And the price was $1 including shipping! He bought two!

We have never had any problem with the quality of the batteries we have received from Asia. And I doubt they are any different than the ones that Radio Shack (or Best Buy or Wal-Mart) sells. The only difference is the lack of markup. Happy battery shopping! For other frugal ideas, check out Life as Mom.

I Am The Lamest Blogger Ever

I just wanted to put a post out there that I am the lamest blogger ever. I don't know how other bloggers post on a daily basis. I'm just trying to keep up on a weekly basis and am failing miserably.

Okay, now that that's out of the way, I want to add that I haven't been thinking much about money lately specifically saving money. If anything, I've been thinking about how to spend money. It kind of goes against my nature but it is how I've been feeling. Two weeks ago, the rabbi, where my children go to Hebrew school, passed away. It wasn't sudden, as he had been ill for a few years. But he was 34 years old. Thirty-four! Gosh, it makes one stop and think. He left behind a wife and four young children. There is a website dedicated to his memory, and I have found myself looking at it from time to time, browsing pictures of him from happier days. And when I see pictures of him smiling at family events or when I read stories about him telling jokes to his congregants, I think to myself, does saving money really matter when it all comes down to this?

Well, yes I still believe it does, to an extent. But there is saving, and then there's going overboard. Put money away for emergencies. Yes. Scrimp every last dollar you make. No. Save money for retirement. Yes. Turn off the heat each night before you go to bed. No. Put money away for your children's education. Yes. Don't ever take them on a vacation. No.

None of us know how many years we have left on this earth. G-d willing, we will all live to 120. But if we die tomorrow, will we be sorry that we didn't order that steak dish that we love so much at our favorite restaurant? Will we be sorry that we never took that vacation to Paris? Will we be sorry that we didn't spend money to learn how to play the piano?

On the other hand, if we live to 120, G-d willing, we do need to live on something other than boxed noodles. And we cannot depend on the government or others to take care of us. So we do have to put money aside in case something catastrophic happens. And we need to have a plan to pay for medical expenses for ourselves. So I will always think saving money is smart. And I do think we should all be doing it. But, let's not become a hoarder of money. Once you have an emergency fund, are happy with your retirement savings, and feel comfortable with the amount you have saved for your children's education, spend freely on what you enjoy. Take that trip to Paris or bring your kids to Disney World. Eat out at your favorite restaurant on special occasions. Sign up for piano lessons.

As far as we know, we only get one chance at life on earth. And sometimes that life is short. Many times it is not. So, save wisely, but enjoy yourself, too. As none of us know which life expectancy camp we fall into. For some, the length of our life is not nearly long enough as was the case with our beloved rabbi. Fortunately, he was a great role model for living life to its fullest. He seemed to enjoy every moment on earth and every person he was in contact with. While one can certainly live a full or even fuller life without spending a lot of money, I have found myself loosening my reins a bit on our spending because of his untimely death. I don't want to regret not doing things because I didn't want to spend the money - money that we had to spend. Saving just for the sake of it is not always the best option.

So I am looking at our savings and spending with new eyes with the idea that if we can afford it, and it will enrich our lives, then we will do it. Having said all that, I know that the best things in life are free. My family and friends, and the beauty of nature don't cost a dime. Although, that plane trip to see nature's finest might. Thanks for being a good example, Rabbi Levi. We miss you.

Don't Get All Of Your Eggs From One Chicken

Tip #278 - Don't Get All Of Your Eggs From One Chicken. We all know the saying, "Don't put your eggs in one basket." Well, I believe we can apply that wisdom to how we earn money. Suppose we have one very good egg-producing chicken. We rely on getting our eggs from her day after day after day. But then one day a fox raids the hen house and there goes our source of eggs. Or our hen gets an illness and passes away suddenly. Or the egg gets too old to lay eggs. Now from where do we get our eggs?

As I am sure many unemployed people today can attest, earning all of your money from one source can be pretty scary if that one source dries up. No matter how great that source was at one time, many events can happen to effect it: The economy goes sour, and the business you work for is no longer produces as much. A small company's business owner passes away, and the company closes up shop. You are fired. You become incapable of doing physical labor that your job demands. That's why it is important to find more than one chicken from which to get your eggs.

Whether you are the main breadwinner or just earning some side money, it is important to have various sources of income. Or at least various ideas of where you can earn income if your main job goes south. Sometimes it is best if your alternate sources of income are in a different area than your main source. So an English teacher who can also fix cars may be more valuable than a teacher who can also tutor. Because if teachers are no longer in demand, tutors may not be either or there may be lots of other teacher who can tutor. But regardless of what you do to earn money, it is a good idea to at least think of other ways in which you can earn money even if you do not currently do them.

In Real Life (IRL) - In real life right now, I consider myself unemployed. I stepped away from my job over three years ago when my son was born. So while it is somewhat tight, we are living primarily on my husband's income. Because of the high-cost of the DC area and because we have three children who like to do activities and two parents who like to take vacations, I try to earn some money on the side while I stay home with our 3-year old. My main source of income is selling on eBay. I have built up a small business and a routine for making money on the world's largest auction site. In the past year or so, eBay commission or fees have gone up dramatically, leaving me with less take-home pay than before. While I still find eBay to be my greatest source of income, I have tried branching out to other venues to sell my wares. I've been trying to sell some things on Craigslist before listing them on eBay sometimes. Without any fees whatsoever, it allows me to sell things more cheaply, and is a good alternative for me.

This past year, I sold clothes at a consignment sale (and made about $40)! I also sold clothes at a consignment store for the first time. I have been completing surveys online in my spare time. I've been bringing books over to my local used book store for cash or credit. And I've been selling books on Amazon.

Now all of this is chump change, of course. We're talking about additional money that we use to pay for my kids' activities or to put toward a weekend away. But the point is, several years ago, eBay was pretty much my only source of income. Then I discovered Craigslist and realized I could make money selling all of the big items that I couldn't sell on eBay. Then I learned about selling on Amazon, and single books that weren't worth listing on eBay were getting sold. Then I added the used bookstore to my list for books that weren't worth listing on Amazon. And this year, adding consignment stores and sales to my income-producing endeavors for items that are not worth selling pretty much anywhere else. Taking surveys are a nice steady source of spending money that doesn't rely on the demand or lack thereof from the buying public.

It never really occurred to me that I seek income from so many different sources until I got a few checks in the mail and some online deposits last week from many different sources - an Amazon deposit, a check from completing surveys, and a check from the consignment sale. And that's when I realized the wisdom of making money from different getting income from a variety of sources. And in this precarious economy, it is a smart thing to do.

Don't Discount Dollar Stores

Tip #277 - Don't Discount Dollar Stores. Dollar stores often get a bad rap. "It's cheap stuff." "It's all junk made in China." "The things from there won't last." And most of those comments have a lot of truth to them. However, sometimes the cheap things are what we need to buy. Or we'd be buying them anyway for more money in stores such as Target, a party store, or an office supply store. And in reality, most of the stuff from these stores come from the exact same place as the Dollar Store. While I am not a big fan of disposable things and junk that piles up in our landfills, there are sometimes we have to buy throw-away items. And the Dollar Store is as good a place as any for buying this kind of stuff.

What the Dollar Store is Useful For:

--Birthday Parties - Goody bags and party supplies such as plates, cups, and napkins are the perfect items to buy in Dollar Stores. They are much cheaper than party stores, although the selection is not as good.

--Incentives - Stickers, pencils, and tattoos to be used for potty training, chores well-done, or when your children master some school-work are cheap enough at Dollar Stores and are often much less than at mass-merchandise stores.

--School Supplies - Glue sticks, staplers, tape, notebooks, folders, etc are typical Dollar Store items. There are usually great sales at the start of the school year for school supplies. But when you run out of things you need mid-year, the Dollar Store is a good place to stock up, and much cheaper than office supply stores.

--Travel - If you are taking a long car trip or plane ride and want to keep your little ones occupied, small toys that are new to them will occupy a child's attention and excite him more than his same old toys. For a few dollars, you can buy puzzles, activity books, and card games that you can dole out throughout your trip to make for some peaceful traveling.

--Costumes - If you need a cheap pirate's eyepatch or a pretty crown for a princess dress that just needs to last for Halloween night, then don't pay more than one dollar. Head to the Dollar Store first before looking to more expensive party stores.

There is a time and place to buy high-quality items that we want to last. But there are times when we need the cheapest thing possible. Cheap items may fulfill your need as well as an expensive one for a lot less money. That is when we can look to the Dollar Store.

In Real Life (IRL) - My daughter had her 9th birthday party last week. I am not one to usually buy a bunch of little, junky party favors to hand out. But we were having a game night party - bingo, charades, and trivia. And I promised prizes to the winners throughout the night. There were 10 girls total, and I estimated the girls would each win 4 to 5 games each, which meant 40 to 50 prizes. First I hunted through my party stash at home, which included goody bag items from left-over parties - mini-staplers, lip balm, and some card games. Then I headed over to our local dollar store and scoured the shelves. I found a 20-pack of decorative pencils for $1. Then I found a 3-pack of 4-color pens, as well as a 3-pack of mini-globe pencil sharpeners. I picked up a 4-pack of jack games, and a 6-pack of scented highlighters. For $5 I picked up all of the remaining prizes I needed for our game-night party.

Sure there were junky items at the store, but I tried to buy things that the kids would use, and things that would hopefully last past the night. And I think I succeeded. While I was at the store, I browsed through the whole store. And I found things there that would be helpful for other needs besides birthday parties.

At the beginning of the school year, we get a list of school supplies that we need to buy. Some of these items usually include zippered storage bags and a couple dozen glue sticks. The storage bags are used to send home simple projects and usually store pieces of paper. (I volunteer in my daughters' school once per week, and I have had fill these storage bags with small pieces of paper. Some of the bags the teacher gave me that parents had bought were high-priced, thick freezer bags that were being wasted holding pieces of paper. Thin, cheap, no-name storage bags would accomplish the same task. Those freezer bags are expensive!) Our dollar stores carries the cheap bags, which aren't good for freezing meals for the winter, but are perfect for children to bring home schoolwork. I also saw 3 large glue sticks per pack for $1. Our school generally asks that we buy the large glue sticks rather than the small ones that are always very cheap during back-to-school sales. At Wal-Mart, we paid $3 for a 3-pack of large glue sticks. They were the cheapest I could find. But I forgot to look at the dollar store. Next time I will remember.

There were other great supplies there like small staplers and rolls of tape that my kids borrow from me for craft projects all the time. For $1 a pop, it's worth it for them to have their own. I don't care if the tape is cheap when it's just used for kids' projects. There were other items there that were worth a look for future emergencies. I saw an 8-pack of cheap shower caps. Not something I'd normally use, but this past summer when we were blessed with lice, they would have been very handy to have.

So while I am not generally a fan of cheaply-made plastic junk, there are times when I have to buy these types of items. And why not spend only a dollar for them rather than more at other stores?

Sell At A Kids' Consignment Sales

Tip #276 - Sell At Kids' Consignment Sales. A while back, I wrote a post series about where to sell your used things. At the time, I listed consignment sales as an option for selling your children's toys and old clothes. While I knew about this venue, and had shopped at them many times, I had never tried my hand at selling at one of them. As of last week that has changed, so I am going to go more in-depth on this topic.

In most major cities and in some smaller towns, there is a relatively new (I don't remember these when I was growing up) phenomenon of holding kids' consignment sales either once or twice per year in spring and fall. They are often held by preschools, churches, or even private companies. In small towns, there may be one big one per year, while in larger cities, there may be a half-dozen of such sales each weekend in March/April and September/October.

You might have to be a member of the particular church or preschool to sell at these sales, but many of them let outsiders sell there, too. If you have a large lot of kids' clothes, a bunch of old toys, or outgrown baby things, this is the perfect venue for getting rid of a large amount of stuff at once, while still making money.

Why sell your things at a kids' consignment sale versus other venues? As a seller on eBay, I love eBay for selling items when the item is worth at least $10. Is it worth my time and effort to list a bunch of $2 and $3 items on eBay? No way. How about Craigslist? That's another selling venue that I love for items that have wide appeal, are worth at least $10, and are too big to ship on eBay. But most buyers won't come out to a person's house for a $2 or $3 item. Yardsales? This is a great place to sell odds and ends but the chances of getting only shoppers who are looking for kids' items are pretty small. Consignment stores? Another great venue for selling some better name clothes but not so good for a bag of boys' socks.

So basically, for a large amount of items that are worth between $1 and $8 each, the kids' consignment sale becomes the perfect venue. It is a place to get rid of a lot of stuff at once. If you are interested in selling at one of these sales, check out some local moms' sites in your area or check out Kids Consignment Sales. The list isn't inclusive, but is a good place to start. Look for a sale that allows outside sellers, and contact them about how to consign at their next sale. Most consignment sales take 50 percent of the proceeds for their church, preschool, or business, but you may get as much as 70 percent at some sales if you volunteer a few hours at the sale. As a bonus, volunteers often get to attend a preview sale before the public.

Once you decide on a particular sale to sell at, you need to follow their guidelines for selling. Most only let you sell in-season clothes, some take all seasons. Some take clothes up to size 14; others do only younger kids' clothes. Some take baby gear; others do not. For most sales, you need to tag your items with an index card of some sort with the name of the item, the price, and your initials or other identifier. You also need a tagging gun or safety pins, and some tape. At the end of the sale, you usually have the option of picking up your unsold items or leaving them there to be donated to charity. After a few weeks you get a check in the mail for 50 percent (or 60-70%) of what you sold.

In order to prepare for these sales, keep two boxes in the garage, basement or out-of-the-way place. One box should be for the upcoming sale, such as the March spring/summer sales. The other can be for the sale that just passed (fall/winter). As you pull clothes from your children's drawers and closets that no longer fit, put them in the right box. Toys and other non-seasonal items should go in the upcoming sale's box. About a few weeks before the sale, start tagging your items. Price them at prices you would be willing to pay at such a sale. A non-designer pair of jeans tagged at $8 will be unlikely to sell and will end up getting donated. Instead price them competitively at $3 or $4, so they do sell. A few days before the sale, bring over your items to the church or school and then just sit back and wait for your check to arrive in the mail!

In Real Life (IRL) - I love kids' consignment sales! While prices are higher than yardsales, I don't have to drive all over town to find a sale that is selling what I want. Going to a big church multipurpose room filled with kids' clothes is the perfect shopping venue for me. And this past fall, I decided to see if it was the perfect selling venue for me, too. Since I am an experienced eBay and Craigslist seller and an avid consignment sale buyer, I have a good feel for what sells well and at what prices I can expect.

About a month before the spring sales started, I looked at all of the different sales in my area on my favorite local DC site, called Our-Kids. I had probably been to about 10 of the consignment sales in the past and knew which ones were bigger, which sold better brand clothes, and which were well-attended. Based on my experience, I picked a sale where I thought my things would do well (I actually picked a smaller sale that isn't overloaded with clothing and didn't have a consignor fee to participate).

About a week before the sale, a friend came over who was also going to sell at the same sale, and we tagged our items together. We had a fun afternoon, while our kids played, and we got most of the tagging done in just a couple of hours. Afterwards, I double-checked a few items on eBay to make sure they weren't high sellers, and I actually pulled a few things out of my box which I thought I could make more money on on eBay. I also added a few things during the week as I scoured through my children's rooms. The day before the sale, I dropped off my bags of items (about 40-50 things total) at the preschool.

The sale was last weekend. I attended during the last hour and saw that most of my items were sold. I'm not sure yet how much I earned, but I'm guessing it will be about $50 for a bunch of smaller items that I had nowhere else to sell. Not bad for a couple hours of "work" with my friend.

Find Out What Your Savings Bonds Are Worth

Tip # 275 - Find Out What Your Savings Bonds Are Worth. Did your grandparents give you savings bonds for birthdays? Christmas? Special Occasions? Remember those birthday envelopes that you opened and you hated? It wasn't a present. It wasn't even cash. It was bonds to become cash one day in the future. The value on the bond would say '$25' or '$50' or maybe even '$100.' And at first you thought, "Cool, I just got a $100 birthday gift." But then your mom or dad would remind you that it's not worth $100 today. It would be worth $100 at some point in the future. "Aww, shucks," what a bummer gift, you thought.

Well, if you are now in your twenties, thirties, or older, you may be changing your tune a bit about those "bummer gifts," if you haven't yet cashed in those bonds, that is. A typical bond that was given as gifts was often the "EE" bond or "Double E" bond as they are known. While the bond may have taken 5, 7, or 10 years to be worth the face value written on the bond, they continue to earn interest for a total of 30 years. And if you got them as gifts back in the 1980's that interest may have been 6%. In the early 90's it was also earning about 4% interest. In the early 2000's, a little over 3%. Find me a place today where I can get a relatively risk-free, tax-deferred interest of 6%, and I'd be a happy woman. Problem is you can't. Which is why if you are still holding on to these bonds, and they are still earning interest, then they are the gift that is still giving (unlike that plastic toy Cousin Myrna gave you that you thought was cool that has long since broken).

So, think back to your younger years, give your mom or dad or grandparents a call, look in the lockbox and find out if you are still holding on to these savings bonds. If you find out that you still have some, then go to Treasury Direct to find out what they are worth. Key in the Series (such as 'EE'), the Denomination, the Serial Number, and the Issue Date and it will calculate the current value of the bond. Even if you do not know the serial number, it will still calculate the current value. If the bond is no longer earning interest, then the result will show a blank under "Interest Rate." If it is still earning interest, then it will show the rate that the bond is earning and will give the final maturity date of the bond (after which it will no longer earn interest).

If you find out that your bond is no longer earning interest, then head over to your local bank with your bonds and talk to a staff person there about cashing them in. If the bond it still earning interest, take note of the maturity dates of each of your bonds, so you can cash them in when they mature. You can cash them in before maturity date, but chances are you won't be able to make as good of an interest rate in other risk-free investments today, so consider carefully if you really need to cash them in.

In Real Life (IRL) - For the last several years, I have been keeping a net worth statement. At first, the amount I had written down on the staement for my EE bonds was just an estimate. I estimated the worth of the bonds based on the amount of interest I remembered that they were earning. Then about a year ago, I was curious if my estimates were really that accurate. So I pulled my bonds out of our safe-deposit box and found the Treasury Direct website, and calculated their worth. My estimates actually had been a bit low because I had forgotten about some bonds that I had gotten as gifts. More importantly than the worth, I took note of the maturity dates on the bonds and made a list of when I needed to cash them in.

Flash back to September 1980 - I celebrated my bat-mitzvah and was given a few bonds as gifts. My parents saved them for me and gave them to me when I graduated college. Fast forward to September 2010 and the bonds are now 30 years old! Not only that, they have stopped earning interest - they were earning 6% annually all of these years. Yesterday, I pulled them out of the safe deposit box again, and I am going to head over to local branch of my bank this week to cash them in. The four bonds that I have from 1980 have denominations of $100, $100, $75, and $50. Today they are worth $1088! Woohoo! The nice thing about government bonds is that you don't have to pay taxes on the interest that they are earning until they are cashed in. (Boo! That means I have to pay taxes on my cashed-in bonds this year.) I still have a bunch of bonds left that I bought in the early 1990's that are currently earning 4% interest (tax-deferred), so I am going to leave them earning interest for now.

So for all of you who think you may have bonds buried deep inside the desk drawers in your house or have them stashed away in a vault at the bank, take note of what you have. Make a list of the issue dates and maturity dates so you can cash them in as soon as they stop earning interest for you. The Treasury Direct site is a neat one, and you can play around with other features on there after you have calculated the worth of your bonds. Now go thank Great-Aunt Sophie for those bonds!

Do A Third-Quarter Review

Saving Money Tip #274 - Do A Third-Quarter Review. It's hard to believe that I just ripped out the September calendar page. In some ways it seems like winter just ended. Three-quarters of the year gone by. It's true that time seems to go faster as we get older. Anyway, enough philosophizing. Today is the day I suggest looking back on the past year to see how well you are doing meeting your goals. Enough of the year has gone by to get a good take on what you have been successful with and what need more work. And there is still a bit of time to make things right again and get closer to your goals before year-end.

So look into your checking accounts, check your balances online for your mutual funds, look at your balances on your credit card loans and car loans or other loans you might have. And come up with net worth. While looking at how much your savings balances have gone up and how much your debt balances have gone down, a net worth calculation gives you a good snapshot of your overall picture.

Today is also the day that you can begin to look forward to next year's goals and plan for the year ahead. Back to school season has slowed down a bit and holiday season hasn't yet kicked in. So there is time to start thinking about next year. Specifics do not need to be written down just yet. But thinking about general goals and vision of what you want in the next year financially can be a good start to making formal financial goals and a written budget at year end. It's soon to be open season for health insurance and other benefits at your place of employment, which is another big factor in your budget and finances.

So tak ean overview of how you are doing so far with your finances, work hard to meet any goals before year-end, and make some general plans for next year.

In Real Life (IRL) - I calculated a net worth statement a few days ago. I had some free time, so I did it a bit early. I pretty much did nothing with our finances over the summer, so this was the first time I got to look at how we are doing. As is par for the course for us, we are behind on our IRA contributions. We have $8000 left to deposit before year-end according to our goals. We have about half of that saved up and need to come up with the remaining $4000. We get an extra paycheck in December so it should work out okay in the end.

Other than that, our mutual funds and stock balances seem to have improved since we last looked in June. It was nice not to worry about the drops that took place over the summer (I didn't look once at our balances), and then to look a couple of days ago and to see that they were fine. That's why I don't like to get hung up on the day-to-day price fluctuations. It saves me time and anxiety.

We're still waiting for our open enrollment information. We've heard that premiums are going up quite a bit this year, so we will have to see what my husband's company presents to us. We are also still on a wait-and-see mode with my husband's job. We haven't heard any more about his office closing, but we know it's imminent. I think we'll hear more at the end of this year/beginning of next year. In the meantime, the longer we stay here, the harder it's going to be to leave. Our kids like their schools. Our mortgage is getting chipped away each month (we celebrate 10 years in our house next month!), and we have a lot of friends.

So that's where we are as we head into the last quarter of the year. We will work on our specific 2011 financial goals closer to the end of the year, but we don't expect them to change much from this year.

Make Money In An Hour

Tip #273 - Make Money In An Hour. Once all of the big financial things are accomplished such as coming up with financial goals, writing a budget, and making savings a priority, there are small things you can do to save money in an hour's time. First, I know you are busy. We all are. But even so, there should be at least a few minutes in your day at least some days per week that you can do things that help you make money or spend less. It is often the small things that help you meet the goals of your big things such as sticking to your budget. Let's look at some examples.

-If your goal is to eat out less then make food preparations in advance, especially for meals that you need to eat outside the home. Waking at 6 am and running out the door at 6:45 AM doesn't leave you much time for making lunch. Find time in your day when you don't have to be out the door in a hurry to prepare your lunch. This could mean making a sandwich the night before, washing grapes and putting them into small containers in advance on Sunday night, cooking a pot of noodles and separating them into a few meals for the week, cutting apples and soaking them in lemon juice or orange juice, filling up your water bottle, and otherwise making lunch preparations in your free time rather than when you are rushed.

-If your goal is to spend less at the grocery store, then find time in your free moments to study the weekly grocery circulars. Spend time making a shopping list. Check out your cabinets and your refrigerator to see what you actually need to buy. Cut out coupons while you are watching television or taking a car ride. If you go to the supermarket without a shopping list, without knowing what you absolutely need to buy versus what can wait a few weeks, without coupons, and without knowing which store has the best prices for what you need, you will end up spending more money than is necessary.

-If your goal is to make some money on the side, then find time to do some money-making activities. If you have a free hour, take some surveys online. The pay isn't much at all but it's better than the pay you get for watching tv. And with a few minutes here and there, it adds up to a few small checks. Sign up for Swagbucks to use as your search engine online. Just by using it on a regular basis, you should be able to build up gift cards at Amazon that can be used toward gifts, groceries, a needed appliance, etc. If you want to make bigger cash, then take time to go through your clothes that don't fit and bring them to a consignment store. Or go through your children's toys and clothing and tag them for a consignment sale. Find bigger items and put for sale on Craigslist. Or sell things on eBay. If nothing else, start a box for a future garage sale, and throw things in the box throughout the year for one big sale in the spring. These are small, but effective ways to make money without leaving the house and perfect for someone who only has a free hour here or there.

-If your goal is to cut down on spending for clothing and household items then organize your things. You might be surprised at what you already own and do not need to buy. Fill a free hour with matching sock from your mismatched sock bag. Look through your cabinets and pull from the back any leftover shampoo bottles, cleaning detergents, toothpaste, and sponges that you bought way back when but forgot about. Go through children's toys and find missing pieces. Anything that can be used that you already own will save money on not buying new ones of the same object.

-If your goal is to do more do-it-yourself work rather than hire someone, then start doing it. That 70's wallpaper in the bathroom? Spend a few minutes a day spraying it with water and peeling. It may take weeks, but it will come down if you take an hour here and there to work on it. Spend time to sew a button your suit jacket. Wash a stain out of a blouse. Start planning games, crafts, or activities for your child's birthday party next month.

Without making this post any longer than it already is, there are many things you can do in even limited spare time to cut down on costs. They shouldn't come at the expense of bigger money-making and money-saving strategies, but they can be helpful supplements to a solid financial plan that you have set out for yourself.

In Real Life (IRL) - I am as guilty as the next person for wasting time. When I have free time, I love to browse the Internet, read books, or sit on the hammock. But as a stay-at-home mom, I have many responsibilities such as making school lunches, buying groceries, planning birthday parties, and keeping the house presentable (at least somewhat). And even though I do not officially work for a living, I do help contribute to my household financially. And I do it in my spare time. I continually go though my children's toys and list them on Craigslist when they outgrow them. I put our used books, DVDs, and CDs on Amazon if it will bring in some money. This month, I've been filling a box to sell items at a kids' consignment sale.

Generally, I take up to 3 surveys a day on the computer. I use Swagbucks as my search engine rather than Google and have built up about $70 balance in gift cards on Amazon in a year's time. When we wanted to redo my daughter's bedroom and two bathrooms, I painstakingly removed wallpaper and wallpaper borders literally for a few minutes per day while the kids napped. It was much cheaper than hiring someone to do it for us. And it wasn't bad to peel for 10 minutes at a time.

At least once per week, I make shortcuts in the kitchen. I prepare peanut butter and jelly sandwiches in advance and freeze them for my kids' lunches. I cut up fruit and put in small containers, and open a bag of pretzels or other snack and dole out in small quantities for the week. It makes it much easier to pack lunch in the morning and makes us less likely to rely on school-bought lunches which are at least twice the price of what I can put together. I try to make healthy snacks such as apple muffins in my spare time rather than rely on convenience foods. I try to keep water bottles filled at all times so we bring them with us rather than have to buy drinks while we are out.

I always browse the grocery circulars and try to cut out coupons when we take long car rides. If not, I at least look through the coupons in advance and bring them with me to the store. I make a shopping list before I go. I try to buy certain items when I am at certain stores that have better deals on those items so I am not overpaying at other stores.

Of course, there are always more things I can do in my spare time to help make money. However, I tend to do the things I like (such as kitchen work) more than the ones I dislike (such as sewing). So none of us is perfect with our finances, but I find when I do take the time to make us money or save us money, I always feel better about spending on things we need to buy. All of us can spare some time here and there to make some money in order to stick to our budget and reach our financial goals. For other financial ideas, check out Frugal Fridays.

Start Off On The Right Foot

Tip #272 - Start Off On The Right Foot. First, two quick notes - sorry about the lack of posting. All I can say is that I'm not as organized as I could be and the start of school is crazy! Second, this post is not meant to make people feel bad about getting a late start to finances, it's meant to encourage people to start early.

For those of you who went to college, think about the grades you got the first semester. You had your semester GPA and you had your cumulative GPA. Your semester GPA WAS your cumulative GPA. So if you got a 3.8 the first semester, your cumulative GPA was a 3.8. When second semester grades came out, they counted as half of your cumulative GPA (assuming you took the same number of credits as the first semester). So if you got a 3.4 then your new cumulative GPA is a 3.6. The first semester of your sophomore arrives and you get a 3.6. These grades contribute toward one-third of your cumulative GPA (again assuming an equal number of credits as each of the first two semesters), and you still have a 3.6 GPA. For the remainder of your sophomore year, your whole junior year, and your first semester senior year, you get a 3.6, a 3.4, a 3.8, and a 3.6 semester GPA, respectively. Now it's your last semester of your senior year, you have maintained a solid cumulative 3.6 GPA up to that point. And you slack off the last semester and get a lousy 2.0! Aaahh! How will that effect your cumulative GPA? Surprisingly, not that much. Your cumulative GPA is still a respectable 3.4.

Do grades in the early years of college count more than grades toward the end of college? No, of course not. Each semester counts 1/8 toward the total. But as time goes by, each semester's GPA contributes a smaller proportion toward your cumulative GPA (as earlier semesters' GPAs do as well). Let's look at this scenario in reverse. Suppose the college student started out with a 2.0 first semester. If he wants to graduate with a cumulative GPA of 3.4 by the time he graduates, he needs to buckle down and get a solid 3.6 GPA's each of the remaining semesters. Sounds hard, doesn't it? It can be done, but psychologically, it's harder because he's starting low and needs to improve.

How does this apply to finances? Saving money is similar to that cumulative GPA. How well you do early on sets the stage for the rest of your saving years. And it's even more dramatic because the early savings has time to compound its earnings. We've probably all heard those financial scenarios. If you put $100 away per month for 10 years in an account earning 3% interest and then do nothing for the next 20 years, you will have over $25,000.* If you wait twenty years until you start saving and put away $100 per month for 10 years you will have just under $14,000.* (The amounts are more dramatic with greater interest rates and/or longer time periods.)

In other words, sacrifice a bit now to put away savings in order to be able to sit back and not worry about it later. It's very easy to put off your savings for when you think things will get better when you are older or when you will be making more money. But why not start now, and if you are in a position to save later on, then by all means do it. But if you aren't, at least you can fall back on what you have already done. If you already have many years behind you where you weren't saving, then start now. The sooner you do it, the greater your cumulative worth will be. (And if you are responsible for a young adult, stress the them the importance of saving early. Starting them off on the right foot will set them up for many years of savings.)

In Real Life (IRL) - When I graduated college and was living on a meager salary, I managed to put away a couple hundred dollars per month, even though at the time there were plenty of other things I could have done with the money - live in a nicer apartment, live without roommates, go out to dinner more, etc. My dad taught me the importance of savings, so I stashed away that savings month after month after month. Then 12 years later when I had my first child, I stopped working (for pay), and stopped saving. That was 9 years ago. Back then in my imagined, perfect life I had planned to go back to work after 5 years and start saving again when my (not yet conceived) second child was 3 years old. In my reality now, my third child is now 3, and I still haven't gone back to work.

That savings I did for about 12 years has allowed us to make a decent-sized down-payment on a house and allowed us to do a 15-year mortgage. It also allowed us to have an emergency fund available and for me to be a stay-at-home mom. (Other things also contributed.) The fact is my early savings has paid dividends both literally and figuratively. Psychologically, it has been freeing knowing that we have that money there for emergencies. Financially, it has allowed us to pursue other savings opportunities more freely - like putting money for college and retirement. Personally, it has allowed us to pursue other things we wanted like staying home with my children.

This in no way is intended to sound like bragging. Believe me, I know I started out ahead of many other by financial benefits my parents gave me (I had no college or car loan when I got out of college.) Instead, I want to point out how freeing it was to save early when I really didn't have too many financial responsibilities. Back then the financial decision I made was whether to share an apartment with a roommate or to put away $200 per month. If I hadn't saved, my decision now would be do I put away money per month or do I pay for my child's braces (sorry, honey, crooked teeth are in style).

If you haven't started on a savings plan yet, don't despair. Now is the best time to get started. Think about what sacrifices you can make. If the sacrifices are still relatively easy (put away $50 per month versus eat out once per month or put away $100 per month versus take a beach vacation) then make them. It's better than the alternative decisions you might have to make down the road such as looking for a second job at age 70 or not be able to pay your rent. It's not too late to start off on the right foot.

*I used bankrate.com to do my calculations.

For other ideas on saving money, check out Frugal Friday over at Life As Mom.

Start Out Simply

Tip #271 - Start Out Simply. When thinking about our finances, it's easy to get overwhelmed - stocks, bonds, budgets, taxes, interest rates, IRAs, 401(k)s, 529s. It's understandable that many people just throw their hands in the air and ignore everything that has to do with money. There is A LOT to learn when it comes to finances. There's also a lot to learn when it comes to cooking. How many of us cook gourmet 5-course dinners with exotic ingredients using techniques such as braising, sauteing, poaching, and blanching? Very few. Instead, most of us learn how to bake, broil, and grill and mangage to keep our families fed well. And we call it good. So why do we think we have to understand everything in order to manage our finances? Does it matter if we don't fully understand the consequences of the Fed raising interest rates by 1/2 percent? Does it matter if we can't predict what Wall Street will do after a fall in foreign markets? Does it matter if we don't quite comprehend the difference between a tax deduction and a tax credit?

Of course it doesn't. We need to know how to live on less than we earn and to build up our savings. Just like the beginning cook needs to know how to boil water and put in some dry spaghetti to feed her family. Once we've done that, we can learn how to heat up jarred sauce to add to the spaghetti. And then maybe we can learn how make the sauce ourselves with freshly bought tomatoes. And then maybe we can learn how to grow our own tomatoes to make our own sauce. But even if we never learn to make homemade pasta, we still feed our family well by starting out simply with dried spaghetti and boiling water.

Why can't we apply that same logic to our finances? We can! Don't be overwhelmed if you don't understand what affects the direction of interest rates, if 529s and 401(k)s are just numbers to you, or if the thought of losing money in the stock market sends shivers up your spine. The important thing is to learn how to put away some money month after month. This can be as simple as creating a budget, putting your money in a savings account and CDs and calling it good. Once you have conquered that, you can start contributing to your company's 401(k) plan, even if is all in guaranteed investments. Then maybe you'll start investigating various investments for your daughter's college fund. And then you might start investing in mutual funds, and then stocks. Or maybe you won't. Maybe you will never invest in individual stocks. Maybe you won't ever understand the how Greece's economic crisis affects the US economy. But if you can at least start out simply with a budget including a line-item for savings, you are doing well. You can build up from there. Otherwise, it will be like making chateau briand when you haven't mastered grilling a hamburger, you won't be able to get it right.

In Real Life (IRL) - I got my first passbook savings account when I was a 7- or 8-year old kid. I understood that if I gave my bank $100 on January 1st that they would give me about $105 back on December 31. It sounded like a good deal to me then - better than sitting in my drawer, anyway. (And 5 percent on a savings account sounds like a great deal to me today!) I also learned that if I saved my allowance week after week, I could buy something very nice after a few months. And if I blew my allowance on gum and candy, I wouldn't have enough money for a nice toy several months later.

A few years after I had that knowledge, my dad taught me about money market accounts. If I put a larger amount of money in that, I could get a greater rate of return than in the passbook savings account. But I had to keep my balance above a certain amount, and I could only make large withdrawals at a time. My knowledge of finances was quite simple back then. But it served me well. I learned if I put money away I could make back more money. And the more and longer I put it away the more I got back.

When I first started out on my own after college, I continued to put money into banks, until my dad taught me about mutual funds. I, little by little, started to add money to that account. Then I began investing in my company's 401(k). Once I maxed out on that, my dad suggested IRAs. Then I joined an investment club and learned to invest in stocks. All the while, I continued to save my "allowance" (income) so I could buy a house one day. It wasn't until we bought one that I learned about tax deductions. And when I had kids, I read up on 529 Plans. It's been over 30 years of learning to get to the piont where I am today. And I still don't know squat about selling stocks short or don't read up or care about how the Nikkei market did yesterday. But I can make a darn good hamburger. And sometimes I can even add a few tasty sides. All because I started out my financial education simply.

Make Savings A Priority

Tip #270 - Make Savings A Priority. When thinking about money, many of us think about how we would spend it - a new car, a vacation, new clothes, etc. Most of us don't think about how much we would save. Saving is actually secondary in most people's thoughts with regard to money. However, if having money is one of your goals, then you need to make savings the primary thought. Many of us would like to be "rich." but if all we think about is how we would spend money, then we aren't like to become "rich." Instead, we need to make saving, rather than spending, a priority. Once savings becomes a priority, the getting rich part will fall into place.

If you were to make a budget on how you will use your hard-earned money, you would need at the top of the list a housing budget, a food budget, a utilities budget (such as water and heat), a transportation budget (to get you to and from work), and a healthcare budget. The above items are priorities in most American lifestyles. After that, you should budget for savings - how much you want to put away for YOU. You want to have some wealth to your name, don't you? Then decide how much you want to save each month for you. This money will give you the power to do things you want to do when you wan to do them.

After you decide on how much you want to save for yourself, then you budget however you want with the leftover income - cable t.v., a yearly vacation, a daily coffee, dinners out, etc. The key is to make sure you make savings a priority above your wants. To simplify, your budget should look like this:

Budget:

Needs
Savings
Wants

Once we start making savings a priority above our wants, we will, over time, have enough money to take care of our wants and other needs that arise. Depending on your income, and your expenses for your needs, you may still have enough money for wants in your monthly budget. But you shouldn't spend all of your money on wants after your needs have been satisfied. Savings should take priority over wants in your monthly budget. Then down the road when a chance to take a ski vacation comes up, you can look to your savings to do it. Or if you decide you want to add a deck to your house, you can do it. Or if your son suddenly falls and breaks his leg, and you have to pay all kinds of doctor and hospital copays and leave work early without pay to drive him to various appointments, you can do so because you have money in your savings account. You wouldn't be able to pay the doctors with the daily cups of coffee that you drank over the previous years.

In Real Life (IRL) - When I was younger I made savings a priority in my budget. I shared housing with friends when I was single. I split utilities with roommates. I limited my eating out. I didn't waste money going to bars. And I socked $200 away per month in a mutual fund. And I did this on about $20,000 per year in Washington, DC. (I was fortunate not to have a car payment or student loans.) I also budgeted for one vacation per year and going out with friends (although usually to inexpensive locales).

Over time, I saw my savings account grow because having savings was important to me. Believe me I could have spent away $200 per month pretty easily - higher-end clothing, dining out in nice restaurants on a regular basis, buying a fancier car, living on my own rather than have roommates, etc. But instead, I made saving money a priority, and after 10 years of saving $200 per month, I had more than $25,000 to show for it. (I actualy had more than this because I upped my savings as my income grew.)

Of course everyone's situation is different. Some people will have more needs to pay for than others such as medical expenses, student loans or debt repayment. And therefore, their savings will be less than others. But the key is to do the savings on a regular basis above frivolous wants that cut into your chances of attaining wealth over your lifetime. As long as savings becomes a priority, you will find you have more power to spend moeny as you please down the road.

Don't Let Deals Chase You

Tip #269 - Don't Let Deals Chase You. There is a lot written in the online world about how to "save" money. However, in order to "save" money, you need to spend some, which really isn't saving money at all. There are deals being thrown at us from blogs, credit card companies, auction sites, online stores, and emails from daily deal websites. Unfortunately, often these deals often cause us to spend more money than we normally would even if we get a good buy on what we bought.

If you want to truly "save" money - that is put money away in your bank account, the only way to do it is to not spend it. Getting 50 percent off tickets to a football game is not going to save you money unless it was already in your budget to buy football tickets at full price in the first place. Driving to the drugstore to pick up yet another bottle of shampoo when you already have 10 bottles in your bathroom cabinet costs time, gas money, and wastes space for something of which you already have an adequate supply. And clipping that Buy One Get One Free Ice Cream Sundae won't save you money if you can enjoy a similar treat for less from the supermarket.

If you are truly interested in saving money - that is putting away money - then do not let deals tempt you to spend more than you would otherwise, no matter how good of a deal it is. The only way you can save money on deals is if it is an item in your budget that you had planned to pay full-price for already. Then at time of purchase you look for a better price on it. That will lead to savng money. Spending money on haphazard items that were not in your budget in the first place, will only cause you to spend more money and have the exact opposite effect that you think a "deal" will do. So, if you want a deal then go after one on something you had already planned to buy. Don't let the deals chase you and cause you buy something you weren't planning to purchase.

In Real Life (IRL) - I am bombarded on a daily basis from deal sites - some that come into my email, some that are through sites I visit, and some that come in my mailbox out at the street. While I feel I have pretty good restraint when it comes to spending money, I am often tempted to buy something that is a good deal. If I get a flyer for a hotel that is having a special, I will read through it and ponder the idea of making a quick getaway trip since it's such a good price (vacations are a weakness of mine). I am subscribed to some daily deal sites that send me emails everyday about deals in the area. I have yet to buy something from one of them, but I have been pretty close a couple of times. And I read blogs that talk about saving money and have lists and lists of items you can purchase at a good price. Problem is, I don't need most of those items.

And while I can pass on good deals or waste a bit of money frivolously without going into debt, there are many others who are struggling financially now and do not have a dollar to spare, no matter how good of a deal something is. And I am afraid a person who wants to save money - that is build up their savings account, reading all of these deal sites can cause the reader to actually go out and spend more than they even normally would. Yes, they may have more goods and/or experiences to show for it than if they had paid full price for these items, but if they are spending more money on things they normally wouldn't buy, then they are worse off than before they frequented all of these deal sites.

If you are one of those people who is struggling financially and hope to put away more towards savings each year, make sure that you are not sucked into buying things that are a good deal, thinking that you are saving money. Let your budget driving your buying decisions. If you are have $300 in your budget to spend on a hotel for a weekend getaway, then shop around for a deal. But don't let an email promising you 50% off a hotel cause you to take a vacation that you would not have taken. Your budget should control your purchases. Don't let the deals control what you buy. That will not save you money.

Don't Discount CDs For Savings

Tip #268 - Don't Discount CDs For Savings. Yes, CDs (Certificates of Deposits, not the music kind) currently have ridiculously low rates, I know. But they can still be part of your savings plans. Many of us in this low-interest market want the kind of returns that only stocks and high-risk investments can possibly return. But remember that those high-risk investments with potential for high returns also can have negative returns. So that stock that you were hoping would acheive a 10 percent return for the year can return a negative 3 percent instead. While a CD can return a positive 3 percent. That's a difference of 6 percentage points.

CDs certainly aren't for every person for every savings goal in every season or for ones whole portfolio. But they do have a place in most people's portfolios for many goals. For example, if you are saving for retirement, and are 30 years old, most financial experts would tell you to put a majority of your investing into stock mutual funds or something similar since retirement is so far off. Some might follow the old rule of thumb of subtracting your age from 100 and putting that percentage in stock mutual funds (70% in this case). They may advise to put a smaller percentage in bonds (maybe 20%) and a still smaller percentage in cash or guaranteed investments (maybe 10%). Well, why not look into CDs for those guaranteed investments? My credit union is paying about 3% for a 5-year CD these days. It's not much, to be sure, but it does add some nice balance to a portfolio.

Of course you don't need to follow anyone's rule of thumb with regards to investing. You need to do what is comfortable for you. I know people who like to take on a lot of risk and put nearly all of their money for their retirement into stock mutual funds. I also know some people who are quite conservative who tend to hold more a higher percentage of CDs and government bonds than are recommended.

CDs are a good place to start out with your investments because you will earn greater returns than a savings account or money market account. You will be tying up your money for a certain amount of time, though, which is why you get the greater return. CDs are guaranteed by the FDIC so you cannot lose any money if the bank goes under. If you belong to a Credit Union, that is a great place to start with CD savings since they tend to be more flexible with penalities for withdrawing early on a CD. And if you don't belong to a credit union, you should consider joining one.

CD's might also have a place in your college fund portfolio. While many people in the past few years socked money away in their 529 plans that lost money, the 5-year CDs had rates of 4% and 5%. Doesn't sound so bad, does it? Better than the negative returns many experienced but not as good as the 10% or 12% than many hoped would be the case. Remember college savings isn't all that long of a time frame (18 years at most). And if the rates are in negative territory, there is not too much time for them to recover before your son or daughter goes off to school.

Just because CDs aren't a high-risk, high-return investment, doesn't mean that it's not right for you. Low risk, low return investments have their place in many people's portfolios, too. And while they are not as hip, cool, or sexy as stocks and mutual funds, they are sometimes a better choice.

Consider what you are saving for, how long you have to save for your investment, how much risk you are willing to undertake, and what other investments you have in your portfolio to see if there's a place for CDs among your investments.

In Real Life (IRL) - I really like CDs. I have some knowledge about stocks. I have some knowledge about mutual funds, and I am not scared or inexperienced in investing in either one of those. And during the early 1990's some stocks and mutual funds were my best friends, giving me great returns. But I never let go of the "guaranteed" CDs. Sure they were returning 5% when stocks were giving me 12%, 15% or even 20%. But they gave me some sense of stability and added balance to my portfolio.

When we started saving for college, I put a fair percentage in CDs. They were returning over 5% when I started these 5- and 7-year CDs. With only an 18 year time-frame from the first time I invested for my daughter's college to a much shorter time-frame now (only 10 years away), CDs actually seem like a good choice to me for that short time period. About 75% of our daughter's portfolio is earning 4%-5% for college. And while I know full well that I'd be singing a different tune if the stock market were soaring now rather than declining, I am still happy earning a lesser percentage in return for peace of mind.

Our retirement portfolio also has a higher-than-suggested-by-the-experts proportion in CDs. We have about 40% of our retirement in CDs and similar guaranteed investments even though our retirement is still 20 years away. It's a percentage I feel comfortable with at this stage in our lives and with the state of the economy. And yes, I know inflation can sometimes outpace CD returns, but stocks can have bad years so I pick what I consider the lesser of two risks for the time frame I am investing for. Others may choose differently.

Another reason I like CDs is because we found out we are able to "back invest" in our education and retirement CDs at our Credit Union (Navy Federal Credit Union) during a grace period, which we can invest in CDs that we already have open. This is a great option since we have some CDs with a few years left on them that are paying over 5%! (This is why I love credit unions!) It's a deal we only found out about last year, but we have been able to add to both our retirement account and education accounts this past year, and plan to do so while we still have these good rates.

So consider CDs carefully. They can be a valuable tool in many investment portfolios. For other ideas on how to spend less money or save some up, check out Frugal Fridays.

***Please note that I am not a financial advisor nor a financial planner. I am just one person who is interested in saving and investing money. My thoughts are my opinions only. You should seek qualified investment advice from a professional before you invest.

Have A Plan B

Tip #267 - Have A Plan B. There are so many factors that come into play when trying to save money - where to live, where to work, where to invest, whether to take a vacation, where to shop, etc. And in each of these categories we have choices we need to make that affect our bottom line. We often plan our financial lives around the choices we make - the job we have, the house we live in, the places we spend our money. But sometimes the choices we make do not last. Then the plans we made based on those choices fall apart. So what do we do? We have a Plan B - already planned before our Plan A falls flat. Because lack of planning is often what causes us to spend more money.

Let's look at some examples. Let's say you are part of a family where the husband works and the wife wants to go back to work and needs to find care for her child. You might have a great option with a neighbor down the street who does daycare in her home for a very reasonable cost. You figure out the income you will make versus the cost of daycare and find it worth it to go back to work. Everything is great for three months when the neighbor informs you that she is going to stop doing home daycare. Now what do you do? Well, if you have a Plan B, you fall back on it. Go to your second lowest price daycare that you reseacrched and enroll there.

But what if there is no Plan B? Can you find another reasonable daycare setting in a short amount of time? Or will you have to quit your job or work for awhile with nothing to show for it because your hastily found new daycare is costing you too much? Having a plan B ahead of time will save you running around at the last minute, possibly helping you avoid paying too much for daycare, and potentially helping you keep your job that you otherwise may have had to quit.

Let's take another example where you have a good job but in a declining industry or in any industry at all for that matter. Have you given any thought to what you will do if you lose this job? Do you know where you would start scouting out jobs? Would you have your spouse take on a job? Having a Plan B ahead of time will help you find a new job more quickly than if you haven't come up with some other job options until your job ends suddenly.

Lastly, what if you are investing for college for your child. Your plan is for your child to go to State University which will provide a good education for a fairly reasonable amount. You are saving for college with a specific dollar amount in mind that would cover the cost at State U. But what if your child fails to get in to State U? What is your Plan B? Don't wait until he gets that rejection letter to come up with one. Make a plan B now. Plan B might be a community college for a year or two before reapplying to State U. Or perhaps Plan B is for him to attend a more expensive private college but have your child come up with half the cost to pay for it.

Whatever the Plan B is, the earlier you make the plan, the better prepared you are if your original plan falls through. Coming up with a hastily designed Plan B after the fact will usually result in higher costs.

Obviously, a Plan B will not solve all of the curveballs that life throws our way. There is only so much we can predict and plan. But it will lessen the financial impact if your first choice fall through.

In Real Life (IRL) - My husband is at somewhat of a crossroads in his job. He has already been informed that his company will close down in 18 months or so. So we have some time to come up with our Plan A as well as a Plan B. Our first choice plan is to move with his job. But because a move to a new city with a new job often does not work out, we are coming up with an alternative Plan B and even a Plan C becuase job searches are one of the most important financial decisions. Our Plan B is to have him look for a new job in our current city, while Plan C is to have me start working to tide us over if a new, equal paying job cannot be found.

Did we have a Plan B in place before he was told of his job closing? Well, not really. So we have been given the gift of time in that regard. But that is not always the case, and this situation has taught me the value of being prepared in case things change.

We've had to fall back on Plan Bs in the past for smaller, less important finacial choices. And it's always helped dramattically when there was already a Plan B in place rather than have to come up with one on the spur of the moment. For example, I was planning a birthday party for my little one who turned 3 last week (hard to believe!). In the unpredicatble July weather, I needed to have a plan B for the outside party I had planned. What if it rained (it didn't!) or if it was 100 degrees outside (it was!), what would I do? I could hastily find a restaurant or other indoor venue at the last minute when the weather report came out and could be considered accurate. Instead, I came up with a Plan B in advance. (I did this because of past experience has taught me that the weather never cooperates when I plan parties.) And because I did that, we were able to have a nice party indoors within our budget. If I did not have a Plan B in advance we would have scrambled at the last minute, and probably spent more money than I needed to.

Again, you cannot have contingency plans for every little choice in life, but the more Plan B's you have with regards to financial decisions, the less you will spend and the more you will save when having to utilize last-minute backup plans. (Picture shown are some boxes I spent hours last week on turning into Thomas trains for our indoor birthday party.)

Be Disciplined

Tip #266 - Be Disciplined. Okay, this is a very common sense tip. But as I've been thinking over the past week what is it that really separates the savers from the spenders, I've concluded that having discipline is a big part of it. Obviously, there are certain expenses that some of us can't get away from - medical expenses and some education expenses come to mind. But, we have choices in much of our daily spending.

As we are pushing the shopping cart down the grocery store aisle, we can pick up the gourmet brand coffee, the ice cream treat that we don't really need, and the imported cheese. Or we can show discipline to forgo the ice cream altogether, put up with a cheaper brand coffee, and deal with good ole' American cheese. The difference between spending more and less at the grocery store? Pure discipline. Discipline to put up with generic products or to forgo certain foods altogether.

When we are out shopping for a car, we may feel swayed to buy a top-of-the-line luxury vehicle versus a basic model. Or we may be tempted to add in the deluxe options such as heated seats or power doors. It takes discipline to say no to these fancy cars and luxurious options and save money while doing so.

How about when renting an apartment? Do we go for the one with the washer/dryer in the unit updated gourmet kitchen with granite countertops or are we disciplined enough to deal with the apartment that has a laundry room on the ground floor and sports outdated 80's almond cabinets in the kitchen?

Maybe we have a hard time being careful with our money when we go out to eat or to a bar - it's easy to add another overpriced drink to the tab and another appetizer.

This last example is one that seems to cause a lot of problems for people. If we use credit cards, do we have the discipline to only purchase items that the amount of money in our bank account actually covers, rather than use the card to buy things that we do not have money for? In other words, do we have discipline to use credit cards wisely? Or are they used as "free money" instead?

Again, sometimes we don't have a choice on being disciplined about spending money - medical events happen, emergencies come up, and some things just have to be paid for, no matter what. But for those "optional" expenses, it's the discipline that we have that makes all the difference in our spending.

In Real Life (IRL) - Writing and doing are two different things. And while I think I am disciplined about not spending money in many categories, there are other areas that I fall short. So it takes control for me to stay out of the place where I seem to want to spend money in the first place. But if I do go there, it takes every ounce of discipline I have not to spend money on things that I don't need and wasn't palanning on buying.

For example, I love Trader Joe's. I think it is a great supermarket for many items. They have many choices of inexpensive, healthy choices. But there are other more expensive and less healthy (i.e. snack food) choices that are also available. So when I go to Trader Joe's to stock up on hormone-free cheese, frozen veggies, mini-bagles and our other TJ's staples, it takes a lot of discipline on my part to not also pick up their version of Pirate's Booty called Buried Treasure or something like that). Believe me when I say we don't need it in the house. It's usually gone in one hour flat. I don't need it on my waistline, and it's two dollars that I didn't need to spend. There are many other equally yummy snacks there that I don't need to be buying, but it takes a lot of discipline on my part to bypass them and keep the money in our pocket for more useful things.

Thrift stores are another place I need to be more disciplined about. The cheap prices are so attractive to me, that it's easy for me to spend money on things that I didn't plan on buying. It takes even more discipline for me to stay away from thrift stores in the first place, one in particular that is nearby because I really enjoy the treasure hunt. And even though I have a small eBay business, I have plenty of junk, er inventory, around here that I need to sell before I should be think about buying more stuff, so I just don't need to be going in the first place.

These are two places that come to mind that I need to be disciplined about in order to save money. On the other hand, I can freely go to a fair and not be tempted to spend big bucks on rides and games. That doesn't appeal to me that much. A new car dealership doesn't interest me that much either - I'm more of an AB car kind of gal (an AB car being one that works well enough to get me from point A to point B). And I can't tell you the last time I went to a shopping mall - well I can, it was when I went to take my son for a haircut several months ago - and we found out the Cartoon Cuts had closed. I haven't been back to the mall since. It just doesn't interest me at all. But I know some of these places, along with coffee shops, fast food restaurants, electronics stores, book stores, and others can be challenging for other folks in terms of them having a hard time not spending money there.

And the credit card crisis our country is facing? It's not because credit cards are pure evil. It's because many people are not disciplined enough to forgo buying things that they don't have the money for. And credit cards give them a way to buy these things even if they don't have the money.

What it all comes down to is that we need to figure out for ourselves where our personal weak spot is with regards to spending money. Is it the big items that we just say, "What's another $1000?" and go for extras like the bells and whistles on a new car? Or is it everyday stuff that we have a hard time controlling our spending with - coffee shops, drugstores, and eateries?

Perhaps, we are not disciplined enough to say no to salespeople - whether it be the hairdreser trying to sell us shampoo or the high school kid selling wrapping paper at the front door. If we can all identify our weaknesses, then we can work on having enough discipline in those areas to avoid going there in the first place or saying "no" when we do. Easier said than done, I know. But you know what they say? Recognizing our problems is half the battle to solving them. It just takes discipline to go the rest of the way. For other money-saving ideas, check out Life As Mom.

Sell Gold

Tip #265 - Sell Gold. Gold has been at an historic all-time high lately. I am not promoting gold as an investment vehicle or not. I'll leave that to the investing professionals to advise. What I am suggesting is that you look through your jewelry boxes and find those old, gold chains that have been broken for years. Or those pairs of earrings that are missing one half the set. Or those outdated charms that have not been around your neck since 1982. Gather up all of your gold scraps and bring them over to a local gold or coin dealer and find out what they will pay you for your stash. If there is more than one place in town, then shop around.

But before you go, learn a thing or two about gold. First find out what the current rate is on gold. There are probably many sites that will tell you the current price on gold. One is called goldprice which gives you the price of gold in ounces. Or you can change the measurement to grams, which is a more measurable weight for small quantities. Currently, it says that gold is about $1200 per ounce or $38 per gram. But remember that is PURE gold - 24 Karat gold. If you have 14K gold, then it is not worth as much. To find out what 14K gold is, take 14 divided by 24 and then multiply that number by the number of grams it weighs. Then multiply that result by $38 (or whatever the current value is). That should give you a rough estimate of its worth. You can do the same for 10K or 18K.

The next thing you should do is check Ebay. If you have a bunch of 14 karat gold necklaces that altogether weigh 3.5 grams, then look up "scrap 3.5 grams gold" and you should get an idea of what they are selling for. When I did the calculation 14/24 * 3.5 * 38, I came up with about $77. Sure enough, the range this amount of gold sold on eBay was between $70 and $76. I wouldn't expect to get quite so much at the gold and coin store because they need to make a profit, too.

Even though I am a seller on eBay, I prefer not to sell gold on there. If I can find a local source for selling it that's hassle free and gives me a decent amount of money, then I prefer that. With the fees on eBay and the possibility of loss or buyer dishonesty, I would rather earn a few less dollars and not have any hassle. I'd be happy getting $60 for that amount at the gold store.

One note of caution before selling gold. Remember that what I am talking about above is scrap value. This gold is being sold for its melt down value. Gold will have more worth if it is an historic piece, a name brand, or it is intricately designed. You do NOT want to sell a piece like this for scrap value as it could be valued for much more. An example would be an old piece, one with a Tiffany name or one that has a lot of workmanship in it.

Lastly, make sure the item is free of stones before you sell or have the jeweler give them back to you.

Once you have determined that you are just selling a back of an earring, a broken chain, and a few old charms that only have scrap value, figure out its worth, compare what you found out to what they are selling on eBay, and then bring it into your local gold, coin, or jewelry dealer. If you are comfortable with the price he offers you, sell it, and put your newfound cash into your savings account. It will do better there than sitting in your jewelry box.

In Real Life (IRL) - My mother-in-law came for a visit a couple of months ago, and she brought with her some gold coins that she had stashed away in the vault. She decided that she would rather have the money then have them sit in the bank collecting dust. And since gold was at an all-time high, she wanted to sell. Because the coins were a specific type with a name, we were able to just look its worth up on eBay rather than weigh it. We found that the going rate on eBay for this particular coin was $300. The next morning my husband and his mother went over to the coin and jewelry dealer to ask him what he'd pay them. The answer? $250. We were quite happy with that price. On eBay, if we could get the $300, we'd be paying over $30 in fees plus the cost of insurance to ship, the risk of loss or the buyer being unhappy, not to mention the time it would take to take photos, write up a listing, and package it. $250 in cash was much more appealing. So she sold her coins and was happy.

Then I decided I wanted to get in on the fun. I raided my jewelry box which held a broken chain, an old charm from my sweet sixteen that spelled out "luv" and a few earrings that were missing their mates. They were a mix of 14K and 10K. We weighed it, figured out the approximate price it was worth and then brought it over to the store. We were happy with the $30 I received. I then did a second look-through and found a heavy earring that I missed the first time around along with a couple of other pieces. This time I receive $60.

For the fun of it, my husband also brought over two gold pins that I once found at an estate sale for $3 each. They are beautiful gold lilies with a pearl in the middle. The jeweler offered him over $400 for the pair! But I didn't want to sell these for scrap gold. They were too pretty, and I really didn't know much about them. So they were put back in a safe place. But it was fun to find out that I made a good purchase a few years ago. I was so excited with our gold sales that we told my parents who gave us some old cufflinks that they had and a broken pair of earrings to sell.

Remember not to get caught up in the excitement of gold because it's at its height now, but consider carefully if you you have some junk gold laying around that now might be the right opportunity for you to sell it.

Be Careful About Saying "What's Another $1,000?"

Tip #264 - Be Careful About Saying, "What's another $1,000?" I know there are many people out there drowning in debt. Not including a house mortgage, I have read many people's stories about owing others $20,000, $40,000, $70,000, or even over $100,000. This might be a combination of student loans, medical debt, credit card debt, and car loans. And when one has $65,000 in loans, it is very tempting to say, "What's another $1,000? Let's go buy that large screen television."

Please, please, please don't think this way. Another $1,000 is another $1,000. And while it may seem like a drop in the bucket when you owe $50,000 or more. It's not - it's $1000 plus interest over time. When you seem like you are drowning in debt, don't keep adding to your debt because you think it's just another small drop in the bucket. Instead, work out a plan to attack the debt that you already have.

On the positive side, I've also read many stories where people have said they have paid off $35,000 in debt in two years or $70,000 debt in five years. So it can be done. Instead of adding to your debt because the amount seems insurmountable anyway, make a plan to get out of debt. Write up a financial plan for the next five years, create a budget, find ways to reduce your expenses and/or increase your income, and start paying that debt down. Every dollar of debt does count. Even if the number seems extremely high and too much to conquer, do not feel helpless and keep adding to that debt. It will only make the number that much higher when you decide enough debt is enough. So take wherever you are at today and start to tackle it. Don't throw in the towel.

In Real Life (IRL) - Several years ago I went to see a well-known designer, Michael Payne from HGTV, give a talk at a Home Show. As he was telling us about remodeling, he said the four most dangerous words when doing a room or house remodel are "While we're at it..." The audience had a giggle about that, but this phrase has always stuck with me. When redoing a room or a house for tens or hundreds of thousands of dollars, it's easy to say, "While we're at it, let's do the bathroom for another $10,000: or "Let's add a deck for $15,000," because after all, if you are already spending $100,000 on a remodel what's another $15,000? Well, it's another $15,000, that's what it is - not too different from ther person who feels overwhelmed with his debt so he keeps on spending. It's a very dangerous place to be.

I have a friend whose husband is out of work. This family has always lived pretty well - and I suspect above their means. So when the husband lost his job, I thought they would finally cut back on their spending. Instead, I see no change in their lifestyle. They recently confided in me that they spent $3,000 to send their son to summer camp. I was aghast - literally. After all, who spends that kind of money when they clearly do not have it? And that's when the idea for this post occured to me. I suspect that they have so much debt that another $3,000 just doesn't seem to mean much to them anymore. After all, what is $3,000 when they maybe owe $60,000 or even $150,000? I can't say much to her; I have tried. The best I can do is be an example.

My husband is not even out of a job, but as I mentioned in an earlier post he was told that his office will be closing in about 18 months. And because of that, I have already cut back. I cut out a $125 camp that I didn't feel was necessary this summer. And I have continued to show my friend the benefits of thrift store shopping. But she doesn't catch on or isn't interested. So I keep my mouth shut. And instead I write on here anonymously so maybe others can build up their financial knowledge and make wise choices with their money. And while you're at it...save some money up, as well. For other ideas on saving money, check out Frugal Friday.