Thursday, April 30, 2009

$1,357 Credit Card Rebates – 12 Months

After collecting a $561 rebate from our Citi Driver's Edge card towards the purchase of our Prius, I decided to run a report on Quicken to track total credit card rebates.

Total Savings: $1,357.

Amex Blue Cash:    $688

Citi Driver's Edge:    $608

Discover More:        $60

Fidelity Cash Back:    $60

Saturday, April 25, 2009

TIPS – Purchased at Auction

Using my IRA account at Fidelity, I purchased $5,000 worth of TIPS at last week's auction by the Treasury Department. Normally, I would have executed the order online and would not have incurred any commission. Because I was travelling and unable to trade securely online, I called Fidelity and did the trade with a broker. As usual, Fidelity came through with good customer service. Aware of my situation, they agreed to waive the commission.

Ultimately, I plan to purchase a total of $25,000 in Treasury Income Protected Securities in a 5 year ladder for my IRA. With all the income tax deferred, the IRA is the best place for "income" investments for most investors.

Unexpected Vacation Savings

Fires in Myrtle Beach forced use to abandon our hotel a few days early. As a result, we saved a few hundred dollars in room charges + food for a few days. All in, I think we did very well.

Our Trip Report

  1. We decided to dump the rental car and took the SUV on the trip. By doing so, we saved approximately $300.
  2. We stayed in a budget MicroTel Hotel on the way down. At $62 per night, it was clean "enough" but that is about it.
  3. We packed cooler with food and drinks for the drive. As a result, we avoided stopping for breakfast and lunch both coming and going.
  4. We stayed at the Avista Resort in North Myrtle Beach. They were friendly and the rooms were comfortable. With a kitchenette, we generally ate out for dinner. For breakfast (and some lunches), we ate in the room.
  5. I spent a shipload to play two premium golf courses. Golf is my hobby and they were special courses I will remember for a long time. I do not drink or smoke. I figure golf is my vice and I can live with that.
  6. Shopping – my wife got hosed by the fires. We were forced out of our hotel on the day we planned to go shopping at the outlet malls.
  7. Food – Myrtle Beach is the chain restaurant capital of the world. Although we spent more per meal than I would have hoped (given the quality of the food), the overall spending was within our expectations because we did not eat out as much as we expected.
  8. Gasoline – cheap gas in the South is fantastic!!!


Thursday, April 16, 2009

Trademarking “Octomom?”

According to today's NY Post, the woman called "Octomom" in the press has decided to try and trademark her moniker. Frankly, I think it is a good idea. She needs to look after her family and should take advantage of any opportunities she has to make money.

Wednesday, April 15, 2009

Did you Tea Bag?

My parents are in their 60's. To my knowledge, they have never protested anything. Although they have voted in almost every election, they are not the "involved" type. Nevertheless, they went to a Tea Party today.

I wanted to go; however, I had a business meeting during the event.

Tuesday, April 14, 2009

Save on Rental Car Charges

Simply put, negotiate. For our vacation to Myrtle Beach, we are renting a car. Originally, I had rented a car through Avis using my corporate discount (AAA and USAA offered discounts; however, they were not as generous). Unfortunately, picking up the car was going to be a hassle.

Although Hertz's online rates (even with AAA and USAA) were not as good as Avis, I called the Hertz branch (which is located in my office building) and asked them to match the Avis rate. Not only did they match the rate, they beat it by $50 and they will not charge extra for the 2nd driver.

Monday, April 13, 2009

Do’oh Sold Goldman Sachs

At $92 per share!! Having bought it at $83 .25 earlier in the year, I thought it was a nice time to take a little profit. Having watched it go to $130.15, I could kick myself. Of course, I would rather sell early and not after the fall.

Sunday, April 12, 2009

SUV vs. Prius – mpg results

Saturday, I ended up filling up both our cars with gas. Needless to say, the Prius demolished the Highlander in mpg and cost/mile. The chart below illustrates how fuel efficient vehicles can really reduce our dependence on foreign oil.

    Gallons    Miles    Total Cost    Cost/Mile    MPG

Prius    7.14    316    $13.92    $0.04    44.26

Highlander    14.2    276    $27.69    $0.10    19.44

Thursday, April 9, 2009

Buy Low - Lowering the Basis

Over a year ago, I began purchasing a certain stock before the market took a dive. My initial purchase was in the low 50's with trades going into the high teens. By this time last year, I had purchased 160 shares at an average price of $23.00 per share. At current prices, those shares are down 67%. Despite a horrific loss on my initial investment, I am only down 24% on my total investment in the firm.

How? I continued to buy shares even as the price fell. All in, I own my shares at a average price of $10 per share.

Although the stock is still in the single digits (it is a financial services company), the recent bounce back means erasing my losses in 2009 is actually possible.

Why did the strategy work? I believed the company was fundamentally sound and would recover if the economy stabilized. As a result, buying the stock at $4 per share seemed like a great opportunity.

Tuesday, April 7, 2009

Tax Savings on New Cars!

The recent stimulus program passed by Congress had a couple of provisions I was not aware of when we bought our Prius. For new cars purchased between certain periods,

  1. We can deduct sales taxes from your federal taxes. (Our state does not charge sales taxes on Hybrids – no benefit).
  2. We can deduct interest charges on the loan.

Since we put a large down payment, the savings won't be huge, but every dollar helps.

Sunday, April 5, 2009

Prius Owner Now!!

Despite my prior posts indicating hybrids were not a "good" buy, my wife (and I) now own a 2009 Toyota Prius. How it happened?

  1. My wife's vehicle, a Corolla, had 98K miles on it. Because of it got better mileage than my SUV, it was our primary vehicle. Unfortunately, it was not very comfortable. Power locks – nope, Power Windows – nope, cruise control – nope, comfortable ride – nope. While it was perfectly fine for tooling around town, trips over 1 hour were not fun. Furthermore, it lacked some safety features I wanted to protect my wife (and someday a child).
  2. My wife's daily commute is, and will be, relatively long. We knew we wanted a vehicle with good mileage, but large enough to be baby friendly should we be blessed. Originally, I expected we would get a small wagon (Matrix), or a mid-size sedan (Accord/Camry).
  3. Although my wife liked the Accord, she hated the Matrix (and so did I). The Matrix was loud, had an awful ride, and had horrible visibility. Since we were at the Toyota dealer, we decided to test drive the Prius. Simply put, she fell in love and I knew it.
  4. Financially, it was not a "great" decision, but it was not as bad as I thought. Although not apples to apples, we were looking at the slightly larger, faster (4cyl) Accord v. the smaller (but large enough), more Prius. In terms of sticker price, the Prius was about $5K more expensive than the Accord. Luckily, we were able to make up some of it. The Prius had a $1,000 rebate and the dealer was willing to negotiate. In addition, Connecticut does not impose a sales tax on the Prius. Ultimately, I figure we spent an extra $3,000 for the Prius.
  5. What did we get for our $3,000?
    1. My wife prefers Toyotas to Hondas. Her happiness is an important consideration.
    2. If gas prices are in the $2.00 range, we expect to save $600 per year. If they go to $4 again, we would save approximate $1,200.
    3. We feel the Prius is big "enough" for our needs. With a hatchback, we feel she could easily carry a child in a carseat and any necessary accessories like a stroller.
    4. I am a Texan and think big. For once, I get to be an eco-nerd.

Saturday, April 4, 2009

Newspaper Industry - RIP

In B-school, we learned about the concept of Creative Destruction. Essentially, Creative Destruction means there will be the creation of something that destroys something else. In the case of newspapers, the destroyer is the internet. If you own stock in any newspaper company, sell it immediately. They are rapidly going the way of the buggy whip manufacturers. Will a few survive in some form? Yes. Will the survivors be good investments? Probably not.

Survivors: Wall Street Journal, NY Times, NY Post, and some local papers (probably in weekly form)

Closures: Just about everyone else.

Thursday, April 2, 2009

Refi – Almost Done

As per my previous posts, I am in the process of refinancing my home. Frankly, it has been a baffling process whereby banks seem oblivious to their own best interests.

  1. For reasons I cannot understand, the bank did not want to put my wife's name on the mortgage.
  2. The appraisal was idiotic. All I wanted to do was convert my ARM (4.7%) into a fixed loan. I did not want to extend the term of the loan or take money out. By fixing the interest rate, the bank reduced risk and I reduced my risk. The bank should have been begging me to convert the loan to a fixed rate.
  3. I ended up having to reduce the principal due on my first mortgage by $3 grand. Since the bank owns the 2nd mortgage, they should have insisted on having the money applied to the 2nd mortgage – not the 1st.

Appraisals – Still on Crack!

Yesterday, I received the results of the appraisal on my house required by my lender. Simply put, the "value" of my home is a fiction. If I could sell my house for the appraised value (or close to it), it would be a miracle. While it will help me refinance my home, it worries me that we may not have learned from our past mistakes.

Inflated appraisals is one of the reasons we got into the housing crisis.