I’ve Paid For This Twice Already…

Archive for the ‘tips and tricks’ Category

I hadn’t talked about this before, because sometimes I get so immersed in the whole personal finance blogosphere I start to think if I know it, everyone else must already know it too. I did that with snowflaking - because it was one of the few “financial” type things I already knew about before I started the blog, I just assumed it was common knowledge. But obviously, it wasn’t, and it was a good use of my time and effort to explain the concept of snowflaking and help spread the word about attacking debt, savings, or even investments in that manner.

Obtaining my credit report for free (sans score) once a year was something I knew that I was legally able to do before I started the blog, but I actually didn’t know where to get it. After a conversation a few nights ago with some coworkers about the “Free Credit Report dot com” commercials and my explaining where to REALLY get your free credit report, I realized that because of the clever and incessant marketing by the aforementioned company, a lot of people may not actually know where to obtain their credit report for free, no strings attached, and it made me want to spread the word.

The “go-to” site for your FREE credit report, no strings attached, is www.annualcreditreport.com . This is the official site to request your free yearly credit report, and was created by the three nationwide consumer credit reporting companies - Equifax, Experian and TransUnion. You will not get your credit score from this service, but you will get a free copy of your entire credit report from any or all of the three reporting agencies. You can request a report from each of the three agencies once per year. Many people who use the service will rotate their requests so they can see their credit report more frequently - for example, in January request from Equifax, in May from TransUnion, and then in September from Experian. That way you get a more frequent snapshot of your credit report than once yearly. Generally, the three credit reporting agencies will have similar (but not identical) information on their reports.

Last June I requested all three of mine at once for the very first time, simply because I had never done it before. I decided I wanted to see all three for myself and see how similar they were, since I had never requested one before. They were in my case pretty similar after all, so going forward I have a different plan. Generally, I am going to request one every 6 months (one in July and one in January, rotating through the three on an 18 month cycle), because I want to have one available to check if I am worried or concerned that something may not be right. For example, last year soon after I had already requested all three of my reports, I got a letter from a company I had never heard of called Certegy, telling my my personal data had potentially been breached. Turns out they are a check/bank account verification service that had been used by, among other companies, Amazon, which is how they had my data. I would have liked to been able to request a free copy of one of my credit reports a month after that happened to keep an eye on things.

If you’ve never checked your credit report, now is the time to start! Request at least one of the three company’s report today, for free, and make sure it is accurate. If you find errors, you can then contact the company that furnished your report to correct or dispute them. Happy credit checking!

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For a very long time, I thought that prepaid cell phone plans were only for people with bad credit. Basically, I believed the “mainstream” cell phone plan hype - that the minutes for a prepaid were horrendously expensive and any self-respecting person with decent credit would get a cell phone plan instead. I focused on the wrong thing - the cost per minute - instead of the actual number that mattered, which was how much I use it.

I admit, I may be the only person on the planet that simply hates talking on a cell phone. When people talk about their cell phone being their only phone and not having a “landline” at home, I cringe. I simply hate talking on my cell phone, and the only reason I have one is in case of an emergency, and for the occasional text. I do like to send and receive texts. I have two small children who I transport here, there, and everywhere, and I need the security of a cell phone in case something happens. My spouse was happy to have his, too, when my car broke down a few miles from our house in sub-zero weather.

So, I don’t use my cell phone very often. I generally would get a low-usage monthly plan, which cost, for two phones, anywhere from $50-60 a month, and call it good. But a few years ago, I started researching cheaper alternatives, and realized that for me, a prepaid phone was really a viable alternative. Once I let go of the “cost per minute” factor and started focusing on the “cost per month”, I realized that I was throwing tons of money away on minutes I wasn’t using. At the time I switched to a prepaid phone, I paid $20 every 60 days, per phone, to keep it active. For 2 phones, that was basically $20 a month vs the $60 I was paying for our family plan. I immediately started saving $40/month, or $480/year. What a difference!

Prices have gone down even further since then, and I currently pay $20 every 90 days per phone, or about $14/month for the two phones combined. I personally use Virgin Mobile, but I also used Tracfone in the past and liked it, but when we moved, our reception suffered so we switched. The other nice thing about prepaid is, since there is no commitment, if you don’t like the reception, you can just try a different one when your minutes and time run out. I have successfully gotten a free phone through a promotion both with Tracfone as well as Virgin Mobile, so my startup costs was just the minutes for the phone. And the money you don’t use in the 90 days carries over to the next 90 days once you add time/money to your phone.

I would recommend checking out a prepaid cell phone to anyone who is an infrequent user like me. For frequent talkers, a monthly plan is probably a better deal, but for people who don’t use their phone too often, like me, the prepaid plan makes perfect sense. I did a little research about what is out there right now, and I found a few companies that do the $20 every 90 days plans:

• Boost Mobile
• Virgin Mobile
• Tracfone
  

And T-Mobile has a $10 every 90 days card - which I think means they are really the best deal! But, I couldn’t confirm through the website if you only have to add $10 every 90 days or not. It seems since they have a $10/90 days card, that you would only have to add $10, but I need to check that out more thoroughly. I may be changing my plan soon…

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This morning I wrote about how to maximize the rewards you earn from the MyPoints program to give you the greatest benefit. Now, I’ll admit, I am a little bit of a numbers geek, and I shared my system for calculating point worth - which is accurate and robust but a little bit on the complex side. Most people don’t want to think in fractions of pennies, and rightfully so.

Commenter lulugal11 left her method for comparing point values, and it is much easier to digest for the decimal-adverse among us. I think it makes the system a lot easier to understand, so I wanted to highlight her comment:

I have been using MyPoints for years now and get most of my points in the email clickthroughs. I use my points for WalMart cards because that is where I do most of my shopping and also for Red Lobster cards for my annual birthday dinner.

I was looking at your point calculation and the decimals might be a bit confusing. I calculate my points the other way around, by dividing the total points by the cash value so that gives you the number of points you need to spend per dollar.

Using your examples:
Target costs 1500 points for $10, 3750 points for $25, and 7500 points for $50

1500/10= 150 points per dollar
3750 points/$25 = 150 points per dollar etc….so they are all the same value.

THEN:
CVS has 1450 for $10, 3500 for $25, and 6750 for $50
1450 points/$10 = 145 points per dollar
3500 points/$25 = 140 points
and 6750/50= 135 points per dollar so it is best to wait for the $50 card.

This is an easier calculation than using the decimals and I just wanted to share another way of looking at it with you.

So there you have it! Instead of thinking about what each individual point is worth, you can look at it as how many points does each dollar cost. The less points you have to spend per dollar, the better! Thanks, lulugal11!

I’ve redone my original table here to show this calculation. You can use either the method I described this morning or this method to determine the best value for your points, which ever is easiest for you. I do like my method because it allows me to calculate a dollar amount savings for waiting to buy bigger cards in some cases, but this method is a lot sleeker without all the fractions of pennies to compare things in a simple and efficient manner. Whichever your method, enjoy using your points to the best advantage!

$10 gift cards: (cost of card in points: # of points each $ costs- the lower the better!)

• 1400 points: 140
• 1450 points: 145
• 1500 points: 150

$25 gift cards:

• 3250 points: 130
• 3500 points: 140
• 3750 points: 150

$50 gift cards:

• 6250 points: 125
• 6750 points: 135
• 7250 points: 145
• 7500 points: 150

$100 gift cards:

• 12000 points: 120

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A while back, I wrote a post about the different paid survey sites I use and why. I have tried a large number of sites and I have kept the ones that for me, give the most reward for the amount of effort. One of the sites I wrote about I noted wasn’t a survey site at all, but instead a reward program called MyPoints. It is one of the very few sites I use that does not pay cash rewards, instead they pay in gift cards. However, there is a huge selection of gift cards you can choose from and a number of stores I use regularly are among them, which to me, makes it similar to getting cash.

The program is pretty simple. there are a few ways to earn “points” - one, you can click through the emails they send you (the emails all come from MyPoints, but the clickthroughs are to third-party sites, usually nationally-recognized chains) and you get 5 points per email clickthrough. You can buy merchandise through their portal, and you get points for that as well. They also occasionally have surveys you can take for points. Generally, I set up my email program to automatically filter their emails to a folder, and every few days I go through a clickthrough frenzy and catch up completely. I have earned the majority of my points with simply email clickthroughs, and have already earned a $10 Target gift card and have enough points now for another $25 gift card.

I realized when deciding what to redeem my points for this time that I wasn’t really maximizing the usefulness of the points I was using. There is a huge list of vendors you can get gift cards for, and different vendors have cards for varying amounts of points - it isn’t a flat point rate across the board. So I developed a few guidelines I am going to use in the future to maximize the effectiveness of my points and get the most value for them.

1. List what you currently use as far as stores, not what you “want” to use.

As I stated earlier, there are a ton of different vendors, from amazon.com to Target to Walmart to specialty stores like Bath and Body Works and The Gap… way too many to list here. Go through the entire list, and make your own list of what you actually currently use. These are the stores that have the most value to you - getting MyPoints to pay for expenses you already have is much better than adding “prizes” to your life with the points. I have this problem myself - I found myself getting a Target gift card even though I don’t need to shop at Target, I just want to. The first time, I actually had something I needed to get there, but with my current redemption, I was just getting it because I like Target. This made me re-examine my thinking on that and I generated a list of stores that I actually shop at even if I don’t have “free money” there.

2. Do you typically give gift cards as gifts or shop for holidays at stores outside your normal routine?

If you generally give gift cards as gifts, this can be an excellent way to get those gift cards. Alternatively, if you shop at different stores for the holidays than you usually shop at, add those to your list if they appear here. A complete list of what is useful to you is needed before we can compare point values. For example, I shop at LL Bean only at Christmas for my father-in-law. My Points has LL Bean gift cards, which I could use to get his gifts, so I added that to the list for comparison.

3. Compare different redemption amounts within a single vendor.

Now that you have a comprehensive list of what you use, look at each vendor and figure out which point redemption amount is the best value. To do this, look at the lowest redemption amount, usually $10, and compare it to the higher dollar redemptions to see what the value of each point is. I am going to use two examples, Target and CVS. Target costs 1500 points for $10, 3750 points for $25, and 7500 points for $50. If we take $10.00 and divide by 1500 points, we get a value approximately $0.00667 per point. The HIGHER that number is, the better the deal, because the higher that number is, the more each individual point is worth. I’d rather my points be worth half a cent each rather than a tenth of a cent. Doing that same math for the $25 and $50 values, you get the same value per point of $0.00667. So, in Target’s case, the $10 card, $25 card and $50 card have the same value per point, and there’s no reason to wait to earn enough for the $50 card, unless you want to.

Now let’s look at CVS. CVS has 1450 for $10, 3500 for $25, and 6750 for $50. If we do the same math (divide the dollar amount by number of points it costs) we find that the approximate value of each point is $0.00690 for the $10 card, $0.00714 for the $25 card, and $0.00741 for the $50 card. In this case, the points are not equal and there is clear value in waiting until you have enough points for the $50 card. If you want to get really math-geeky, you can take the value per point of the $50 card and subtract the value per point of the $10 card to get the difference between them, or in other words, how much more in fractions of a penny the points are worth in the $50 card vs the $10 (about $0.000511) and multiply that by the number of points you use to redeem a $50 card (6750) and get a total “bonus” for waiting until the $50 card of $3.44. Basically, you got $3.44 more by getting a $50 card for the number of points you have to use to get it than you would have by redeeming points for $10 cards all along.

Take home lesson - find the best value for each of the vendors you are interested in. If you need more help with the math, I am more than happy to assist. Oh and take home lesson #2 - small savings add up! We’re talking fractions of pennies adding up to dollars! I love it.

4. Look for “point bargains” by comparing the point redemption value across vendors.

As the last example illustrated, not all vendors “sell” their cards for the same amount of points. So now that you know which point value for each vendor is the best value, you need to compare your chosen vendors to get the ultimate deal. There are some hugely discounted items in the list, but do not fall for them unless they are part of your normal spending! But if they are - great! Snap them up.

In my above example, if Target and CVS are both on my list, CVS is the better deal as far as value per point, and the CVS $50 card is the best deal within that. You can compare your list in pairs - if you have 4 vendors, compare #1 and #2. Say #2 is the best value. then compare #2 to #3. Say here, again, #2 is the best value. Compare #2 to #4. Here. we’ll say #4 is the best value. You now know #4 is the best value overall, because #2 was better than #1 and #3 so if #4 is better than #2, it has to be better than #1 and #3 too.

If that makes no sense you can compare each individually as well. It just takes a little longer.

For me, once I did all the calculations, it ended up that an LL Bean gift card was the best value for my points. You can actually get a $100 gift card that each point is worth $0.00833. But I don’t spend $100 at LL Bean a year, I generally spend ~$50. the $50 card is still a great value at $0.008 per point, though, better than the rest of my list (Amazon, Walmart, and CVS). I am trying to decide if it is worth the $3.99 extra I would make for my points (compared to the $50 card) to redeem for a $100 gift card and use it for Christmas presents two years in a row. It’ll be a while until I earn that many points though, so I have time to consider it.

It is a little math-intensive but really, not that bad! The magic formula is $$ of card divided by # of points card costs - and you want that result to be as LARGE as possible. But remember - pick things you actually use! Sure a $5 NetZero card is a GREAT deal with a point value of $0.01 per point, but I do not useNetZero, so what is that doing for me?

Good luck and post your favorite deals in the comments! I’ve included a table of common card costs and what that translates into for value per point.

$10 gift cards: (cost of card in points: $ value of each point, the higher the better!)

• 1400 points: $0.00714
• 1450 points: $0.00690
• 1500 points: $0.00667

$25 gift cards:

• 3250 points: $0.00769
• 3500 points: $0.00714
• 3750 points: $0.00667

$50 gift cards:

• 6250 points: $0.008
• 6750 points: $0.00741
• 7250 points: $0.00690
• 7500 points: $0.00667

$100 gift cards:

• 12000 points: $0.00833

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Since I posted my ING Direct Savings Referrals, I have had several requests from people to explain how to use the subaccount feature I spoke so fondly of. I’m not surprised, because I was pretty confused on how to do it myself when I first opened my ING Direct Savings account. The process is surprisingly easy but not exactly intuitive to find.

In short, the process is almost exactly like opening your initial account, except you will not have to go through the verification process for the linked account a second time (as far as verifying the non-ING account you link to). Here’s the process step by step:

1. When you are logged into your ING account, look on the left sidebar and click “Open An Account“.

2. In the main screen, the top left box is labeled “Orange Savings” and the first selection is “Orange Savings Account”. Choose “Open Now” from this selection.

As a note, the “refer a friend” under the “open now” choice is where you click to access your referrals so you too can refer people to ING Direct and earn bonuses.

3. There will be a drop-down menu for what type of account you would like to open. Choose the type you already have open - if you have an Orange Savings Account, choose that, if you have an Orange Savings Account - Joint account, choose that. I have a joint account with my spouse so that is what I choose.

4. If you choose Orange Savings (not joint), skip this step and move on to number 5. If you choose Joint - you will have to enter the customer number of the other person. This is the same customer number they were given when you opened the original account. The joint owner will then have to “log in” by confirming their image, phrase, and pin number you created for them or they created.

5. The next screen will have you create a nickname for the account - do this! This is how you keep the joint accounts identifiable to you. I name them simply - my kids’ names, or what they are for. YOU CAN CHANGE THIS AT ANY TIME. So if you decide to repurpose an account, it is easy to do. So don’t get too hung up on the perfect nickname. You will then have to choose the funding source and initial amount for the account - either your linked checking account or another ING subaccount.

6. The last step is just agreeing you have read the disclosure statements. Then you are done! The account should show up now when you click on the “My Accounts” tab. To see details about any account, click on the account name when you are on the “My Accounts” Tab.

Some helpful notes:

• If you ever want to change an account nickname, click on “Account Maintenance” when you have the details of that account open. You then click on the “Change” button next to the nickname. I have done this several times.
• You cannot close a subaccount online. However, if you call their customer service, it takes about 14 seconds for them to do it for you. Just in case you decide there are too many for you to handle. They’ll even transfer any unposted interest into another subaccount for you. Yes, I’ve done it. Heh.
• Each subaccount is limited to 6 withdrawals a month. This is a federal regulation not an ING one - but transfers between subaccounts count towards this total. So just be aware of how often you are moving your money.

If you have any more questions - ask! I love my ING account and I find it very easy to use. And if you are not a current ING customer, have $250 or more as an initial deposit to start an account (there is no minimum initial deposit but to get a bonus you need to start with $250), and you’d like to get a $25 bonus for opening a savings account… check out my referral page!

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