I'll Never Pay for Long Distance Again

I did a post a couple of weeks ago recommending Google's latest acquisition - GrandCentral.com. If you didn't read that post, you can take a look at it HERE.

I've been thinking about GrandCentral since then - trying to figure out what, if anything, I could do with this kind of service. As a refresher, they give you a phone number and you can give that number out and your calls to that number will automatically be forwarded to any number you designate. Well - after a couple of weeks of thinking about it - I've figured out how that I can use a service like this.

Here's my plan. Anytime I need to call someone long distance, I simply go to GrandCentral first and enter the long distance phone I'm trying to call there. Then - when I call my OWN GrandCentral number (the number that got assigned to me when I signed up) my call will auto-forward to the long distance number of the person I'm trying to call. I've called a local number (my GrandCentral phone number is a local Charlotte number) and the service does the forwarding - so no long distance fees for me!

Give it a try! You can still sign up with the link in my earlier post.

Get 12% Off on All of Your Gas Purchases

I don't know about you, but my gas purchases are starting to get ridiculous. I filled up yesterday and it cost me nearly $48.00!?!? If prices go up much more (which they're predicting will happen), we could be talking about $60.00 fill ups - not to mention what the increase in gas prices does to your food costs, etc.

There is a card on the market that can help take the sting out of what you're paying at the pump. The Citi Driver's Edge MasterCard has some pretty unique features that make it attractive (especially for the first 12 months). The card offers a 6% rebate for the first 12 months on all gas, supermarket, and drug store purchases. It lowers to 3% after 12 months. The 6% deal is great, 3% is average.

Here's where the extra benefits kick in that make this a great card to get while gas prices are high. This card ALSO pays you a rebate of $.01 for every mile you drive in a year. If you drive 10,000 miles per year (pretty average mileage), that's an additional $100 rebate. The caveat is that mileage rebates have to be used for either a new/used car purchase OR auto maintenance costs. That shouldn't be hard however given that you're likely to do some type of oil change, tire rotation, air filter, etc. during the year that will add up to $100.

Crunch all the numbers out and you're getting roughly 12% back on this offer for the first year that you have the card. I'm not factoring in the money you'll get back from grocery and drugstore purchases either. Now - granted my tag line was a little misleading since you can really only apply the rebate to auto costs - not necessarily gas - but if you're saving one place, that's money that can be applied somewhere else - so it is a legit 12%. This is a great deal. I'm going to get the card, keep it for 12 months and then reevaluate! Please make sure to read the terms and conditions - it details what you have to do to get your mileage credits (fax/mail in receipts from car service places so they can verify mileage).

Website Recommendation: UShip.com

My friend Matt introduced me to a new website this morning that I think people will find really useful. UShip.com is a startup company that aims to connect people that need to ship goods (whether that be boxes/packages across the country or household moves across town) with reliable moving companies. The great thing is that it's an auction style site. You list the particulars of your move and literally thousands of companies bid on the job. You can choose the shipper of your choice based on recommendations, price, feedback from other users, etc.! Even better - there's no cost to use the service!!

Here's just a quick example of how this might be a good site to bookmark for future reference. When I moved to Charlotte from Memphis almost four years ago, I was moving a 2 bedroom apartment (far less stuff than I have today). That move cost me over $4,000. I put in the particulars of that move on UShip (using their estimator tool) and it came back with a price in the $900 - $1200 range. Now - I'm sure that probably didn't include some of the extras that I purchased like packing and insurance - but it definitely looks like this is a place that you could go to save yourself some big time money.

A final note - my friend Matt knows one of the guys running the company and he says it's growing like crazy. I say that to let you know that this isn't some fly by night scam type website - we have actual human contact and have heard some of the 'back story' on the company. Give it a shot if you've got a move coming up, need to ship something you sell on Ebay, etc.

Lending Club - Free Money Update

I posted last Monday about LendingClub.com's $25.00 free signup bonus. I'm happy to report that the ENTIRE process (enrolling, confirming my bank account, getting the $25.00 credit, and taking that money back out) took less than a week! That's really almost unheard of in the online banking/financial world. So...long story short, if you haven't signed up for an account at LendingClub, do it now. It's fast free money - and, like I said in my last post, if you want to try your hand at lending money, you could make it worth even more!

Stop Paying for Movie Rentals

Have you seen the video rental kiosks popping up in grocery stores all over the place? They're owned by a company called RedBox and the concept is pretty straight forward - $1 movie rentals dispensed from a machine. They require a credit card (which I assume is charged if you fail to return the movie) and all rentals are for one day. I tried the one from my local grocery store and it worked like a charm. Given that I live right down the street from the grocery store, it was much more convenient than going to Blockbuster too.

Now - here's the cool thing - this company offers promotions all the time for free rentals and there is a site out there that tracks and publishes them. So - next time you're headed to the grocery store, stop over at InsideRedBox and write down a couple of the codes they've got published. Then - when you're at the store, grab a free video rental! If you don't have a RedBox kiosk in your grocery store, you can go HERE to find out where the closest kiosk is.

Free $25.00 and a Chance at an Infinite Return!

I've talked in the past couple of weeks about venturing into the world of social lending and so far, so good. I've got $500.00 in loans over at Prosper.com and my average rate of return is over 16%. I'll let you know if anything starts going south and people start defaulting.

Today's deal comes from Prosper's main competitor - LendingClub.com. LendingClub is offering a promotion of $25.00 for opening a new account. The site operates much the same way as Prosper - people can lend and borrow money from each other rather than through a bank. It gives lenders a chance to get better returns and borrowers a chance to get more favorable terms than they might get elsewhere. LendingClub's special deal is an effort to get more people borrowing and lending. Here's how to take advantage of the deal:

1. Go to LendingClub.com and sign up to open an account and become a lender.
2. After entering some basic information about yourself, LendingClub will send you an email to verify your account.
3. After verifying your account with the link they send in your email, go back to LendingClub.com, log in, and enter your bank account information on the Bank Account page.
4. In the next couple of days, LendingClub will either add a few cents to your account or take a few cents from your account and you will need to go back to LendingClub and verify the amounts added/taken away (usually it's like two 15 cent credits/debits). This is how financial sites verify that you are the owner of the bank account that you listed and is standard for online financial sites - nothing to worry about!
5. Once your bank account is verified, fund your LendingClub account with $1.00.

That's all there is to it. The promotion states that new accounts that are funded with $1-$999 are eligible for the $25.00 promotion. The site will credit your account within a week of the $1.00 going into your account. Free money!

Now - you could stop there if you just want to get the cash. But - if you're willing to actually fund a loan on the site, you have a chance for an INFINITE return (you invested $0 and any amount that you get in return would equal an infinite return!). LendingClub allows lenders to fund loans in $25.00 increments (Prosper requires $50.00 increments) - so if you want to try to get more than the free $25.00, turn around and lend out that $25.00. You get to shop around and find a loan that you're interested in making based on the proposed interest rate, borrower information, etc. Lend that money out and give the site a test drive. It costs you nothing and offers the rare chance of getting an unbelievable rate of return!

By the way - I realize that you actually invested $1.00 (not $0) - but as soon as the promotional funds hit your account, you can transfer that $1.00 back to yourself - so you really have not invested anything at all!

An Idea for an Online Business

Believe it or not, I was actually asked to speak to my Sunday School class last week on the topic of personal finance. I am betting that invitation had more to do with my parents being the teachers than any expertise I might have in this area - but I was asked nonetheless. One of my primary recommendations was for people to start a home business - both for the income stream it may generate and for the tax advantages. I've had my CD business for nearly 8 years now and it has helped with my Roth IRA, vacations for my family, and a lot of other things that my primary income would not cover. The problem that people have with starting a business is that they often can't come up with an idea. Today I'm giving you a business idea for free.

Two days ago I posted about two sites that give you money for your old electronics - SecondRotation.com and TechForward.com. Given that both of these sites will tell you UPFRONT what the value of the electronics are, you could actually start a business buying electronics on Ebay, Craigslist, Freecycle, etc. and 'flipping' them to these companies that buy the devices. You buy the device and immediately sell it to SecondRotation and/or TechForward and pocket the difference between what you pay and what you sell it for. Pay for the items with your credit card and you can theoretically start the business with no money out of pocket.

If I wasn't already busy with my job and the CD business, I'd give it a shot. If anybody actually tries it, let me know how it works out - and don't say I never gave you anything!

Get a Better Credit Card

I love going to Costco. I've mentioned the benefits you can get from shopping at warehouse clubs in some of my earlier posts. Yesterday, however, I had an annoying experience at Costco that reminded me to post about something that I've been meaning to discuss and that some people don't know.

I was going through the checkout line and gave my American Express card to the cashier (Costco only takes cash/debit or American Express). The cashier made some kind of motion when she saw my card and the next thing I knew, some lady appeared at my side trying to push the Costco AmEx card on me. I felt really bothered by the fact that the cashiers were summoning these shills over whenever someone paid with a card that wasn't the Costco branded card. It felt to me like they were using semi-private information (what kind of card I use) for their own benefit. I didn't like it one bit.

Anyway - the lady gave me her best pitch, trying to get me to sign up for the card. She was telling me about how I could get 3% back on gas purchases (except when I purchased from their competitors at Sams & BJs!) and 1% on other purchases. I listened to her explain all the benefits and then simply told her that I was sorry - my current AmEx has better benefits. She told me that this was not possible since their card was the best consumer AmEx card. That's exactly my point - I don't have a consumer AmEx card! I have a business AmEx card and you can have one too. Anybody can have a business AmEx - all you have to do is fill out the application and list your business as a sole proprietorship with one employee (yourself). You use your own Social Security number as the tax id. That's all there is to it!

Most credit card companies give much more favorable terms on their business cards since these often get issued to companies that are large and have many employees. Your sole proprietorship (You Inc.) can reap the same benefits that these big companies get and most people don't take advantage of this. I've got two business cards myself for my side business and I don't plan on ever going back to the consumer cards - the benefits just don't stack up!

Get Paid For Your Old Electronics

If you're like me, you probably have a decent collection of old cell phones, video game systems, MP3 players, etc. Every year or two I seem to upgrade my gadgets and am left wondering what to do with the old ones. In the past, I've simply given them to Goodwill (which is still a decent way to get rid of things). However, with the IRS cracking down on charity donations and the issues around disposal of electronics (putting them in landfills is not good for the environment), I started wondering if there were better ways to get rid of this stuff. Turns out there are ways that I can both help the environment and make some money!

Second Rotation is a site that buys back all kinds of electronics - cell phones, digital cameras, video game consoles, MP3 players, etc. - and extends their life by selling them in markets where the technology is still viable or in demand. You enter your device, give the details about it (what condition it's in, etc.), mail it to them, and get paid. If your device can't be resold, they'll recycle it in an environmentally friendly way.

TechForward works a little differently - but the concept is the same. This site allows you to lock in a future trade value for your unwanted devices. I have an 80GB IPod that I know I may not want in a year. I can go to the site, tell them that I will send the IPod in one year from now, and lock in a trade value for the IPod. Once I'm locked in, I am guaranteed to get the amount that they promise - AND if I decide I don't want to send it in a year from now, I'm free to walk away! Just like Second Rotation, these items are sold in other markets and, if they're unsellable, are recycled in environmentally friendly ways.

There are a number of sites popping up around the net that offer this type of service. So - next time you're thinking of getting rid of a piece of electronics, think again. You may be able to pocket some cash in the process!

I Just Made $100 in 5 Minutes

Here's a great way for you to put $100 (or more) in your pocket and it only takes about 5 minutes. Have you been getting the ads in your mail for all the cable/internet/phone packages on the market? I get at least one a week from both Time Warner and Windstream. Any time I see that kind of aggressive marketing, a bell goes off in my head. These two companies are in a war for customers and this is an opportunity for me to reap some benefit as a result.

What did I do to get the money? I called my current cable/internet provider, Time Warner, and asked for their cancellations department. When the cancellation department came online, I simply told them that I'm interested in cancelling my service with them because I got a better deal at Windstream. Immediately Time Warner offered me a deal that keeps my service exactly as it currently is but will cost more than $100 less over the next 6 months. If they had not offered a better price, I could have either gone through with the cancellation (which would have been a pain), told them that I needed to double check with my wife before placing the final order (which would have gotten me off the phone and I wouldn't have lost anything), or told them I had a bad connection and called back in hopes that I got a different person who may be willing to negotiate.

You've got nothing to lose and everything to gain when dealing with these companies. Cable/Internet/Phone service is rapidly becoming a commodity and these companies are facing shrinking margins. At this point, they are in the volume business and that means they need to keep customers at almost any cost (since keeping current customers is cheaper than acquiring new ones). Give it a try - it worked for me!

Oh yeah - don't think I won't be calling back in 6 months when my bill goes back up. This could be a $200 deal before it's all said and done!

Social Lending - Status Update

As I said in my post last week, my online savings accounts are rapidly dropping their rates in response to the Fed's interest rate cuts. My BEST rate is now all the way down to 4.1% over at ETrade. So - in search of higher rates, I decided to pursue the social lending angle. You can read more about what that is here.

Here's where things stand so far. I decided to go to Prosper.com (primarily because I was already a member and had the bank account money transfer already set up) and I deposited $500.00. My criteria for making a loan was that I would not go below an A credit rating (AA is the highest and it goes A-B-C-D-E from there), I would only lend to people that owned a home, and I would lend in $50.00 increments. That essentially means that I would fund 10 loans. All loans at Prosper are 3 year loans.

I've got to admit - I'm very pleased with the results thus far. Across the 10 loans I've bid on, my average interest rate for the whole suite of loans is 19.89%. I realize that this is a riskier investment - but my lending standards are pretty high (high credit rating, home ownership, no defaults in the past 7 years, etc.) so I feel like the odds of borrowers defaulting is pretty low. In fact, if two of the ten loans default (which would mean now I'm only earning 19.89% on $400), I would still come out ahead of any investment of $500 earning less than 11.3% interest and there's none of those out there right now!! If three loans default, I'm ahead of any $500 investment earning less than 6.5% interest - also almost impossible to find right now.

I'm feeling pretty good at this point. Not good enough to move more cash into play at this point - but I may be doing so in the near future if the payments all start pouring in on time!

Two Credit Unions that Almost Anyone Can Join

A couple of days ago, I did a post about the benefits of joining a credit union. In the post, I gave a link to a site (FindaCreditUnion.com) that you could use to find a credit union that you're eligible to join. Realizing that not everyone will take the time to use that site, I decided to find a couple of credit unions that almost anyone can join. Now you have no excuse for not joining one!

Oak Trust Credit Union is located in the Chicago area (which doesn't really matter since you're probably not looking to do your day-to-day banking there). It's been around since 1964 and is a member of the NCUA (the organization that insures your deposits - just like the FDIC). Anyone can join by making a $1.00 donation to the Illinois Press Foundation. They have a note on their site to make sure you know that the $1.00 donation is non-refundable!

Christian Community Credit Union is open to anyone who belongs to the Christian faith. You have to be willing to affirm a "Statement of Faith" when you apply for membership (though I'm not sure if there's any way they could actually tell if you truly meant it or not!?). If you're not a Christian (another topic for another day) but have a family member that is, you can have them join and then join under their Family Member clause. This credit union is NOT federally insured. They have private insurance that serves the same purpose - but I'm just not as familiar with the company they use (American Share Insurance).

Once again, joining a credit union is a great idea and gives you alternatives when it comes to loans, investments, etc. If you don't have another one already in mind, check out one of these!

Insiders are Betting on a Bull Market

Here's what really bugs me lately about the stock market and the economy in general: every day you read that 'market tanks on fears of recession' or something of that ilk. Why don't we all just go ahead and say we're in a recession?!? If we just go ahead and say it, we can stop 'fearing' it and get on with the business of turning it around. Headlines like that and the fact that the market is reacting to fears of something that we all know is here really bugs me. OK - enough on that.

I read an interesting article yesterday over at MarketWatch talking about corporate insider trading. If you don't know, insiders are typically high ranking employees at public companies that have stock options or own large numbers of shares. When a corporate insider makes a trade, they are required to report it to the SEC. You can even go over to Yahoo Financials and view the insider trades (warning - it's depressing knowing that some guy three or four spots above you on the corporate ladder just exercised $10 million in stock options). The point of the article was that corporate insiders are actually buying MORE of their company shares these days. That's a very rare occurance - typically they're cashing out over a period of time.

So - what does this tell us? To me (and to the author) it indicates that corporate insiders who, theoretically, should know the most about their own companies and their business outlook are buying shares because they think that the market is at a low point. Why would you buy shares in this type of shaky market if you didn't think that better days (higher stock prices) were coming? Hopefully Wall Street will take notice of this phenomenon and we'll get some better headlines in the not too distant future so the market can over react to them in the other direction!

Social Lending - I'm Going In

As interest rates continue dropping, I'm starting to wonder if there might not be other places I could look that would offer better returns. I've been hesitant to date to get involved with the whole 'social lending' phenomenon (though I did do a post a while back about Prosper.com) but with my BEST savings account now paying out a measly 4.4%, I think I've decided I'm going to give it a go.

If you don't recall my earlier post, social lending is essentially person-to-person lending that is usually facilitated by a company like Prosper.com. Prosper takes loan applications from individuals, evaluates their credit history (which is made available to the potential lenders), and then brings lenders like me together with people looking to borrow. Borrowers can often get better rates than they might otherwise be able to get from a bank loan and lenders can certainly get better rates than they would by putting money into a savings account or a cd. There is, however, the risk of default.

Prosper (and other lending sites like LendingClub.com or Zopa.com) have done their best to try to reduce defaults. They employ collection agencies that go after non-paying borrowers and essentially treat defaults the exact same way a bank would. Prosper also allows me to break up my loans into $50 increments - meaning I could fund 10 different loans with $50 each and diversify my risk a bit. Given that Prosper's conservative loan portfolio (the one that they rank as the safest investment) is paying out more than 8% interest, I'm gonna give it a shot. I'll let you know what happens!!

You Can Own Your Own Bank!

One of the best pieces of financial advice I got coming out of college was to join a credit union. A credit union is a financial institution that is owned by its members. Typically membership is based on you meeting some type of qualification - be it your employer, your religion, where you live, etc. The major advantage of a credit union is that, unlike a bank, they are not trying to make money for their shareholders. Since they are non-profit, they are able to offer better rates, lower fees, etc. AND - since you, as a member, are an owner, any dividends or income generated by the credit union is returned to you in the form of dividends.

I am currently a member of three credit unions - two from past employers and one (Pentagon Federal Credit Union) based on the fact that I'm a child of a military veteran. Currently we use a credit union to get life insurance for Britney but I've used it for all kinds of things in the past. Some offer services that you'd never find at a bank - like the one I once used to buy a car. I told the credit union what I wanted and they had a service that looked across the country for the best price on the car (including shipping it to me if that was involved) and then helped me arrange the purchase. Pretty cool service!

Finding a credit union that you qualify for (assuming your employer doesn't offer one) is easier than it used to be. FindACreditUnion.com has a search feature that allows you to enter some input about yourself to see which ones you could potentially qualify for. If you can't find one right off the bat, don't give up - I guarantee you that there's at least one or two out there that you can join based on your family members or where you grew up - something. Joining is easy - typically you just have to open an account and deposit a small amount and membership is usually for life. It's a great thing to do as it gives you options when it comes to loans and financial services and many times those options are better than you could find anywhere else!

Don't Look at Your Home as an Investment

Britney and I got married at her church in Arkansas and one of the pre-requisites for marrying at the church was attending a couple of marriage preparation workshops. At one of the workshops, a professor from the University of Arkansas came and discussed financial topics. One of the things that stood out to me most at the time was his insistance that a house should not be treated as an investment but, rather, should be viewed as an expense. I didn't understand that at the time - as I'd always heard that a house is one of the best investments you can make. After my year of heavy home-related costs in 2007 and seeing what's happening in the real estate market of late, however, I'm beginning to see his logic.

SmartMoney ran an article about this very subject back in 2002 and it does a far better job explaining why a home is an expense rather than an investment than I could do in a brief blog post. Take a minute to read the article.

The gist of it is that even with a nice appreciation rate, the costs associated with home ownership (closing costs, maintenance, taxes, insurance, broker fees, etc.) offset the benefits from tax breaks and appreciation. Home ownership does free you from the black hole of renting and can, if done correctly, allow you to free up some of your income (especially in the future when your mortgage payment on the loan you got years ago likely will look small compared to current market rates). That income can then be put into some wiser investment choices.

It's an interesting premise. Check it out.

Money Saving Tip: 5% Off On Almost Everything

How would you like to save 5% on almost every single thing you buy? It's now possible thanks to the Citi CashReturns card! This is one of the highest cash back offers I've seen and is definitely one you should look into.

Here's the catch - the 5% cash back offer is only good for 3 months. After the introductory period, the cash back rate drops to 1% - which is not as good as several other cards on the market (I'll post more on that later). Don't let that stop you from looking at this card though. Unlike many other cards, this card doesn't give the cash back on a limited set of categories - this thing pays out on EVERYTHING you buy on it. Given that we're entering into tax season, you can even pay your income tax with this credit card. Since it's winter, you're also likely to have higher energy and/or gas bills this time of year that can be paid on the credit card too!

I looked at the websites of all my major bills - cable, phone, power, and gas and all of them offer credit card bill payment. Some charge a convenience fee for the service - but none of those fees added up to more than 5% of the bill - so I'd still be making money even after paying the service charge. I've read reports of a number of people making upwards of $1000 in 3 months with this card. I suppose, if you wanted to get a little crazy, you could even try to 'trick the system' and make some extra cash by doing things like loading up on gift cards at your favorite retailers or paying estimated taxes and overpaying (you'd end up getting a tax refund and the 5%).

Take a look and give it some thought. With a little planning you could make a nice little sum to put into savings!

One Month Coupon Strategy

My wife just sent me a really interesting link to a posting over at The Simple Dollar. The post is about a new strategy for using coupons. Here is the LINK.

The basic premise is that coupons are issued by companies as the first step in a product push. After the coupon comes out, the company waits a few weeks and then puts the item on sale (to try and induce a repeat purchase) - the second step in the product push. Knowing this, your best strategy for using coupons is to simply pull the coupon section out of your Sunday paper and then sit on them for one month. In a month's time, clip the coupons that you're interested in and head to the stores. There's a high probability that the items that you have coupons for will now be on sale as the company is now in the second phase of the product push. Combining the store's sale price with your coupon can often mean walking out of the store with HUGE savings!

Great post and great idea. Read for yourself!

Interest Rate Cut Has Immediate Impacts

Yesterday's interest rate cut is already impacting me! Just a week or so ago, I recommended the E*Trade High Yield Savings account as a better alternative to those offered by HSBC, Emigrant Direct, and ING Direct. I logged on this morning to check my balance and overnight they've dropped their rate from 5.05% to 4.40%. With another interest rate cut expected when the Fed mets next week, I suspect the rates on online savings accounts will continue to fall.

So...what to do? Well, first of all, let me recommend the Rate Chaser Calculator from My Money Blog. This is a neat tool that will help you figure out whether or not it's worth your time to move your money around based on rates offered by different banks. According to the calculator, it'd take me 255 days to make up the lost interest if I were to move the funds from E*Trade back to Emigrant Direct - so it looks like I'll sit tight for a little while.

I am, however, considering looking into locking down a fixed rate by putting my emergency fund money into a short term CD. From the looks of things, there are still some banks out there offering over 5% on 6 and 7 month CDs. That takes away some of my liquidity and I'd have to forfeit the interest gains if I actually needed to touch the money before the CD matures I'm not entirely sold on that idea. Nonetheless - be aware that these rate cuts we're hearing about in the news will trigger a lot of activity by the banks so watch your accounts to make sure you know how you're being impacted!

Is the Sky Falling?

Today's opening bell saw our financial markets take a serious fall and the Fed take emergency action for the first time since 9/11. Couple this with all the talk we've heard for months about the economy teetering on the verge of recession (if we're not already in one) and one could not be blamed for thinking that the sky may, in fact, be falling.

I get a little irritated by all the doom and gloom talk. Nobody in the media seems to cover the analysts that are saying that we're NOT heading for a crash landing. I guess negativism sells more papers and gets higher ratings but it also gets depressing and I eventually start tuning it out.

If you are curious, there are analysts out there that do believe that the extent of the problems we're seeing is being exagerated. Norman Fosback, editor of Fosback's Fund Forecaster, stated on Monday that the strength of the global economy should help keep this recession mild - if one even happens at all. If you're not familiar with Norman (I wasn't), he's been publishing forecasts with a high degree of accuracy since the mid-1970s.

Head to MarketWatch to read more about what Norman Fosback had to say about our current situation.