Tag Archives: benefits

Car Wash Costs May Make You Think Twice

This is a guest post from the future Mrs Adam. As you will see, her writing style is quite different from mine and hopefully it will give you a break from my mundane babble. Hopefully, I can get her to post some more things in the future.

With summer time right around the corner, I felt it necessary to give some insight on the grand task of washing the car. Most of us lead very busy lives with hectic schedules, many places to go and people to see. This type of schedule often leads to slacking in certain areas like washing our vehicles. Since we spend a good penny on our automobiles and should want to keep them clean, most of us probably find ourselves saying, “Thank God for the car wash”! Right? After all, some of us do not want to go through the hassle of reeling out the hose and filling up the sudsy bucket to spend an hour scrubbing away on the car. Especially when in 5 quick minutes you can be through a car wash with a spick and span ride. I say, to everyone that is thinking they are very guilty of being sucked into the car wash all too often, wait a minute and at least listen to what I have to say. Keep in mind that I am in no means discrediting the local car wash because after all, it has been there for me when I needed it most.

As far as costs go, it should be very obvious to us that it is expensive to go to a car wash (I am mostly referring to the kind that has all the wishy-washy scrubbers that you drive through and has an air dry at the end). For instance, to go to the car wash you can pay anywhere from $5-$8 depending on the type of “wash” you get. The more expensive washes claim to wash extra areas and sometimes even include a clear coat rinse. We may never know if these items, worth more money, are truly worth it. Anyway, if you were to purchase one of these car washes twice a month for a year, and let’s say you purchase the most expensive one because you are easily persuaded by all the extras, it comes to a total cost of $208 dollars. $16 dollars a month may not seem like a lot, but I know I would rather have it in my wallet to use for other items like milk, eggs, and bread at the grocery store. Some of us would probably never use the car wash that frequently, but there are some out there that may even go as far as once a week to the car wash…which is $32 dollars a month (perhaps those of us more obsessed about having a nice looking ride all of the time). With things like rain and dirt appearing all too often, I would say it’s not worth going that often.

Let’s list some benefits of going to the car wash:

1) It’s a place to go for those who do not have a place to wash

2) It’s quick

3) It’s convenient for people who do not have patience or interest in washing their own car.

Some pitfalls to going to the car wash are:

1) It is expensive!

2) It does not clean all the nooks and crannies of your car. There are always spots that still need cleaned after paying at the car wash

3) You have no control over what is being used on your car (soap, scrubbers, etc)

4) The drying process. If you have gone to one of those car washes that offer the “blow dry” feature at the end, then you already know that it never really gets your car dry. What ends up happening is an $8 car wash that should have made your car look awesome leaves it looking mediocre because either dust clings to your wet car when driving away or you ended up with water spots all over your car.

Now let’s take a closer look at washing the car yourself. You can go out and purchase all the items needed to wash a car for under $20. Once these items are purchased, you are as good as gold for a while, perhaps months, as long as you have access to a hose and a place to wash. This could end up saving you a lot of cash in the long run. Other than saving money, there are many other benefits to washing the car yourself.

The benefits of washing your car yourself are:

1) It gets you good exercise! Getting out and scrubbing the car is a great way to burn calories

2) During the nicer times of year it is a nice way to get outside to get some fresh air and sun. Even if it’s hot outside, just give yourself a mist with the hose. It actually feels pretty good!

3) You will get a much more detailed wash. Washing your car by hand gives you the ability to clean everything properly down to removing those pesky bugs that get plastered on the front bumper in the summertime. As mentioned before, the car wash will never remove all the dirt and grime, especially bug guts!

4) You have total control over the products used to clean your car. It is important to use decent car wash soap as well as a soft scrubber. Avoid scrubbers loaded with dirt and grime because the small particles could scratch the paint on your car. Ever wonder what kind of build up is in the scrubbers at the car wash?

5) The drying process. At home you can use a shammy to properly dry your vehicle to avoid water spots from appearing on your newly cleaned car

6) Pride. It is always nice to take a step back and look at a job well done after washing the car. There is nothing more satisfying than a nice shiny car

The pitfalls to washing your own car are:

1) You hate to wash the car

2) You do not have a sufficient place to wash the car

Now, I know that there are some of you out there that have read this, but still insist on using the local car wash for most of your washes and you have your reasons. But hopefully some of you that have been falling into the car wash routine will see the benefits to washing yourself and try it more often. I personally LOVE washing my car. It is a good stress reliever, I feel like I am getting some exercise, and I know that since I am paying a lot of my money for my car, I should be the one taking care of it.

Here are some tips for washing the car:

Many people may not know this, but DISH SOAP is VERY BAD for the paint on your car. Avoid using it at all costs. You can purchase soap specifically made to wash the car at any auto store and places like Walmart, Target, Sears, etc. I use soap by Turtle Wax that claims to put a waxy finish on your car. It’s nice.

If you truly want to keep your car in good shape, then taking care of the finish is important. Waxing the vehicle is essential in keeping the finish like new. Wax blocks harmful things from eating away at the paint on your car. You should wax your car AT LEAST once a year, but I would suggest every 6 months especially right after winter when your paint finish has been exposed to things like salt and calcium from the roads.

Lastly, Tires. To make your car have a complete clean look, cleaning your tires is important. Nothing compliments a clean shiny car more than a set of black shiny tires. Use a spray on foam from brands like Armor All after you are finished washing to make the tires look slick.

Any suggestions from other car washers out there on products that work for you would be great!

After reading this article are you more inspired to wash the car yourself, or will you continue to use the car wash despite of costs?

photo credit: pixel0908

How to Choose Credit Cards With Rewards to Save Money – Part 1

This is a guest post by Mr Credit Card from www.askmrcreditcard.com. Mr Credit Card reviews credit cards on his site. He also has a blog and you can subscribe to his blog here. Mr Credit Card will post a 2 part series on how to choose a credit card with rewards to save money on your spending.

Hi everyone! Firstly, I would like to thank Adam for the opportunity to guest post on his blog. Friends of mine inevitably ask me what credit card they should get when they find out that I actually run a credit card review site. This is a tough question to answer without first finding out about someone’s spending patterns. But the thing that always makes me shake my head is that fact that folks who pay in full every month carry a “vanilla” Visa or MasterCard. Worse of all, some even pay an annual fee to do so. If you pay your balance in full (or carry only a small balance occasionally), then you should be making money from credit cards by a getting a reward card, instead of letting credit card companies make money from you. It should be a two way street.

But how does one go about doing it? First, you have to be aware that there are two types of rewards. There are cash back credit cards that will pay you a certain percentage of cash rebates for every dollar that you spend on the card. Then there are rewards credit cards. These cards allow you to earn points or miles for every dollar that you spend on the card. You can then redeem your points for things like airline tickets, merchandise, gift cards etc.

Cash Back or Rewards?

The first decision you have to make is whether to choose a cash back card or a reward card. For this, the decision really comes down to preference. What sort of rewards do you prefer? Many travelers who fly frequently prefer to get an airline credit card with their favorite airline. Many folks who do not travel and do not want the hassle of redeeming points prefer to earn cash rebates instead.

How Do You Choose a Cash Back Credit Card?

For the rest of this post, I’m going to focus on explaining how I think one should go about choosing a credit card that pays you cash rebates. In part 2 of this post, I’ll focus on how to choose a reward card instead.

The first thing one has to understand is that different credit cards have different cash rebate formulas. And for someone who is researching it for the first time, it could be rather confusing. But here are the few features you have to be aware of:

Vanilla standard 1% formula – The vast majority of rebate cards fall into this category. They will pay you 1% rebate for every dollar that you spend on the card. While this looks like a decent deal and much better than a standard vanilla card, you can get better deals out there.

More than 1% on certain categories – These are the type of cards you should be looking at although there is less of them these days as credit card issuers cut back on the rewards they give. There are cards out there that pay more than 1% on certain categories that you spend. For example, a card like the American Express Costco Card pays 3% on gas, 2% on travel and restaurant spending and 1% on other regular stuff.

Rebates for online shopping – Some cards like Discover Card allows their card holders to earn between 5% to 20% if they use their card to shop at over 100 online retailers through their site.

Tiered Formula – Some cards also have a tiered formula. That means that you need to spend above a certain amount to earn more rebates. As an example, the Amex Blue Cash lets you earn 1% on gas, supermarket and drugstore spending for the first $6,500 of annual spending. Once you pass that threshold, you earn 5%. Having a tiered formula is not necessarily bad. It just means you have to use your card above a certain amount to fully make use of it.

How to Choose the Right Card For You

1. Figure out how much you spend on your credit card – Yes, go through your credit card bills and figure out how much you actually spend on your credit card.

2. Break down your expenses into different categories – The next step is to breakdown your spending into different categories. You should use the following breakdown as a guide:

Gas
Supermarket
Drugstore
Travel
Restaurant and Dining
Movies
Home Improvement
Others

3. Calculate rebates you can earn on different cards – Now comes the tough part. You have to do some research on the different cards available and use a calculator and figure out how much you will save from using each card. Then, once you are done with this exercise, you will know which is the right card for you. To make your life easier, I have actually created a cash back credit card calculator to save you time. All you have to do is to simply key in your monthly expenses in various categories and the calculator will show you the top 3 cards that will earn you the most rebates.

OK – that’s it for this post. In part 2, I will write about the different types of rewards that are available in reward credit cards, whether you should choose a frequent flier card or a regular reward card and other things to look out for. Remember, you should extract as much benefit as you can from credit cards and not the other way round.

2009 Economic Stimulus Plans Effect on Taxes Now and Beyond

As most of you know, President Obama signed the American Recovery and Reinvestement Act into law on Tuesday. Supposedly, millions of Americans will benefit from the plan in more ways than one. Here are a few highlights from the plan and how they will affect your taxes now and in the future.

Making Work Pay Credit

The making work pay credit will be heading to a paycheck near you in the coming months. The employed will get up to $400 per individual and $800 per married couple. Sounds like quite a good amount. However, you will not see all of this money at once as it will be used to reduce your weekly federal taxes on your paycheck. Every little bit helps in these economic times.

What about retirees, veterans, or people on disability? These individuals on Social Security will get a one-time $250 check in 2009. That should help give a small boost to those individuals on a strict fixed income.

What if you are unemployed? The bill has added several things to help those who are unemployed. It has exempted the first $2,400 in unemployement benefits from federal taxation. The bill has also increased the payout by $25 a week, extended the time period for benefits, and it gave a 65% break on COBRA premiums. I just hope this helps incourage individuals to seek work and not just keep them on unemployement longer.

Help For Individuals With Low Incomes

The bill also provides a larger Earned Income Credit (which is refundable) for families with 3 or more children. For those of you that fit into this category it will not affect you until you file your 2009 taxes. However, you may be able to get EIC advance payments by talking to your HR representative at work.

There was also a part of the bill that lowered the threshold for the child tax credit. This will help lower income families due to the lowering of the threshold from $8,500 to $3,000 for the current tax year.

Making Home Ownership More Affordable

The bill included the long awaited (and widely talked about) 1st time homebuyer credit. The original $7,500 credit needed to be paid back over several years. The new credit is refundable (meaning you can get the money even if you have no tax due) and does not need to be paid back. The nice thing about this credit is that you can take it on your 2008 tax return. If you have already filed your return, you may want to consider an amendment.

What are your thoughts on some of these measures? Will they work or will they come back and bite us later down the road?

Basics of Prepaid College Tuition 529 Savings Plans

Have you noticed an upward trend in college costs over the past few years? I am guessing that you have. College costs have been increasing every year at an average of 6% per year. That means that a public university that costs $10,000 today will cost approximately $29,368 in 18 years. That’s for only ONE YEAR! Are you afraid you will not be able to save that much? What if I told you that you can lock in current college prices. Would you be able to sleep more easily at night? That is the idea behind a prepaid college tuition plan.

What is a 529 Prepaid Tuition Plan?

Prepaid tuition plans are college savings plans that allow you to lock in current college costs. In other words, if you purchase a full years worth of tuition at a state school today, that plan will pay a full years worth of tuition 10, 20, or 30 years down the road. It is guaranteed to increase at the rate of college inflation.

Prepaid Unit Plans

Prepaid unit plans allow you to purchase units that represent a certain percentage of college tuition. For example, you may be able to purchase 1 unit in the plan that represents 1% of college tuition for a year. Everyone pays the same amount for a unit and the price increases each year. You can then use these units to cover part or all of the costs of attending college.

Contract Plans

Contract plans sell, you guessed it, contracts. These allow parents to purchase a set amount of years of tuition at a certain price. Basically, the younger the child, the less expensive the contract price.

Advantages of Prepaid Tuition Plans

Allow parents to lock in current tuition rates
Very simple to understand and no personal investing required
Plans involve no risk of principal and are typically back by state or local government
Anyone can contribute to the plan for the benefit of the beneficiary
If the beneficiary dies or does not attend college, the funds can be transferred to another

Disadvantages of Prepaid Tuition Plans

Have a negative impact on need-based financial aid just like regular 529 plans
Cannot earn higher returns if the market has a great year
Typically, can only be used for tuition and not for room and board, books, supplies, etc.
They do not guaranteed acceptance into college
You are limited to the schools that are listed in the plan

Is a prepaid tuition plan right for you? It all depends on the things that were mentioned above. Look carefully at the advantages and disadvantages and make your choice based on those criteria.

You may also want to consider using the plan in conjunction with a standard 529 plan. The standard plan will allow you to invest the savings more aggressively while the prepaid plan may help you hedge against higher increases in tuition rates. One day we are going to have to start paying back all of the government debt we have and education funding may have to be cut. What will happen then? Large increases in tuition, you can be sure of that! I also recommend using the site www.savingforcollege.com. The site offers evaluations of each states plans and has some great college funding calculators.

Has anyone had any experience with prepaid tuition plans? I know they are fairly rare but someone may have an experience they may want to share.

Health Insurance: Part 3 – COBRA Coverage

This is Part 3 of a series on health insurance. Part 1 discussed deductibles. That post discusses how they affect your plan and costs. Part 2 discussed stop-loss provisions and co-insurance.

The Consolidated Omnibus Budget Reconciliation Act of 1985 or COBRA, is a set of provisions that require some employers (those with 20 or more employees) to continue health insurance coverage for employees after termination of employment.

Termination of Employment

Under COBRA, the employer must offer continued health insurance coverage for 18 months from the date of termination or demotion to part-time. If the employee was fired due to “gross misconduct”, COBRA benefits do not have to be offered. COBRA coverage can be terminated before the 18 month period if any of the following occur:

the employer terminates the health plan for all employees
the employee neglects to pay the required premium
the employee becomes covered under a new medical plan (however, if pre-existing conditions are excluded on the new plan, the employee must be allowed to continue COBRA)

The employer is allowed to require the employee to pay for some of the costs of COBRA coverage. However, they are not allowed to charge more than 102% of the cost of the insurance.

Disability

If termination is due to disability, coverage must be allowed to be continued for up to 29 months. All of the requirements set above are still applicable.

Other Options

There are several other events where an employer must offer 36 months of continued coverage to an employee or their beneficiaries. These events include:

death of employee
divorce or legal separation of the employee
employee’s entitlement to Medicare
bankruptcy

Recommendations

COBRA can be a very beneficial for many individuals, especially in these tough times. If you lose your job, check with your previous company about COBRA coverage. The coverage may be more expensive than you are accustomed to, but may be considerably less than if you were to purchase individual coverage. It also allows you to avoid the possibility of having pre-existing conditions placed on your new policy. For example, if you were recently treated for cancer, your new policy may not cover you for those related expenses. COBRA coverage may help ensure that those expenses are covered for a period of time.

Has anyone had a specific COBRA experience they would like to share?

Health Insurance: Part 1 – Deductibles

This is part 1 of a series on health insurance. I will be explaining several components of health insurance contracts in order to help you make a better decision on your purchase.

Deductibles are a part of health care plans that require you to pay an initial amount before you receive some type of reimbursement. In other words, if you have a $100 deductible, the first $100 is on you and after that your insurance company will reimburse you some or all of your covered payments. Typically, HMOs do not have a deductible although some are starting to have a small one. PPOs typically have some sort of deductible.

If you are considering a PPO, you more than likely have the option to choose your deductible. Typically, the higher the deductible, the lower the cost. This is because you are responsible for a greater amount before the insurance company will have to pay. You should consider your past medical history when choosing your deductible. If you are prone to injury and visit the doctor often, it may not be wise to choose a high deductible because you will have more out-of-pocket. The opposite is true for someone who is very healthy. You may be able to get away with the higher deductible in order to lower your costs.

If you are purchasing a family policy, you typically will also have a family deductible in addition to the individual deductibles. Let’s say for example that you have three family members on your plan. The plan has a $200 individual deductible and a $500 family deductible. If person #1 has an insurance bill of $300, the first $200 is paid in full by person #1 because of the deductible and then the insurance company will pay for part or all of the remaining $100. If person #2 has a $300 bill as well, the same payment structure will apply. If person #3 has a $300 bill, the family deductible applies. Since the already have paid $400 out-of-pocket, only the first $100 of person #3’s bill will be out-of-pocket. The final $200 of their bill will be covered by the insurance company at the appropriate rate.

If you get your health insurance through your employer, you may also have the option of a HSA. I will go over HSAs in a future post but I will give you a quick overview now. An HSA is a health savings account. It is a tax sheltered account that allows you to save pre-tax money for your healthcare bills. As long as you use the money for healthcare expenses, it is tax defered as well as tax-free. These accounts are paired with high-deductible health plans. These plans have higher than normal deductibles. Typically, you should only consider a HSA if you are in good health. Like I mentioned before, I will discuss these in a later post.

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