Posted by Shawn K. Quinn at 3 September 2010

Category: Uncategorized

First, the hard facts:

Iced Tea and Ramen

Launched: 2009 July 11
Closed: 2010 September 2
Total posts made, including this one: 13

I registered the domain with a quite different purpose in mind. That purpose ceased to exist and I had the domain without a clear use for it. Rather than just abandon it, I figured a frugality/financial advice blog would fit the name rather well.

However, I completely overestimated my own ability to maintain motivation needed to maintain two blogs. In fact, in the interim, I started a third blog, Quinn’s Big City before fully developing this one, my second. Due to the differing circumstances behind its launch, Quinn’s Big City was a bit more successful. My original blog, Rant Roulette is also going strong. I’m probably better known for both of those blogs than I ever would have been known for this one.

I probably should have thought things through more than I did, and/or chosen a topic I would write more about on a more regular basis. I am disappointed because I fell short of what could have been, and it is difficult for me to be proud of what little success I’ve had with it when I could have had so much more. That said, it’s time for me to move on. I probably will start yet another blog soon, and I will maintain the existing entries I have made to this blog somewhere.

For now, I am keeping the archives up here. Commenting on the existing entries, all the way back to the first one, will remain open for at least the next few weeks (2010 October 15). Sometime after that date I will close comments, make the final backups, convert the blog to a static site, and then think about where the archives will be housed long term.

Thank you for your interest and support.

Posted by Shawn K. Quinn at 1 September 2010

Category: Uncategorized

So in the digital age, the question becomes “How does one keep track of one’s budget without breaking that same budget?” I’ve used a program called GnuCash for this purpose for the past four years or so.

There’s one big thing which turns off some people, maybe even a lot of people, from GnuCash. That “thing” is the concept of double-entry accounting, which is intimidating to non-accountants but actually relatively easy to grasp. To those that have been using something like Quicken (which uses a category system) it can be a bit confusing and backwards at first. But it’s really based on a simple concept, and that simple concept is: the entire ledger adds up to zero. Put another way, for every transaction there is an equal and opposite transaction (with apologies to Sir Isaac Newton).

Unless you’re starting out flat broke, you will probably have a non-zero net worth when you begin using accounting software of any sort. Even these come from another account in the system, called an equity account (the default GnuCash setup uses “Equity:Opening Balances”). When the books are closed out for the year the ending balances go back into an equity account.

You may be used to Quicken’s use of categories. In GnuCash, the same income and expense tracking is done with accounts. A paycheck or check from a client will come from an income account and go into a bank account. Expenses will go into an appropriate expense account. Liabilities such as credit cards or loans are tracked with a liability account. The value of fixed assets can be tracked with an asset account; it is acceptable to include only the most expensive items such as a house or vehicle (full value can be included, as the liability account for the loan would count against your total net worth in a net worth report).

Now, there are times when you will have money coming back out of an expense account, or even money going back into an income account. Take the following situation: You go shopping for new clothes, and the total comes out to around ¤300. Only after getting home do you realize one of the three pairs of shoes you bought have a defect. You take the shoes back and get a refund of ¤40. That refund would come out of the appropriate expense account. This holds true no matter how you paid for a purchase, whether by credit card, debit card, cash, or check.

A similar situation would occur if (horror of horrors) you are paid with a bounced check that winds up being no good; in this case, it would go back into your income account. Likewise, for reimbursements of expenses incurred while on a company trip, the reimbursement check should be applied first to the expense account first charged to; the ideal solution for frequent travelers would be to set up an “expenses pending reimbursement” asset account (as the expenses the company is reimbursing you for are in fact a debt from the company owed to you).

What about expenses that are one line item on a bank statement, but go into more than one expense account (personal care items bought at a grocery store instead of making a separate trip to the drugstore later)? That’s where split transactions come in. A grocery store trip totalling, say, ¤75 with ¤20 of that being personal care items can thus be accounted for properly. Cash back on a debit card transaction is handled the same way, except the other account is a cash account.

The benefit of double-entry accounting is that finding out how much, say, one’s grocery expenses are total, year-to-date, is as simple as opening up that account. For last month? Just subtract the balance from the balance from a month ago. Is it a bit more effort? Maybe, at first.

GnuCash also includes a financial calculator for figuring out loan payments or other interest transactions, as well as a reconcile feature for verifying the accuracy of bank account and credit card account statements.

Far from the least of GnuCash’s advantages is that GnuCash is available as free software under the GNU General Public License (free as in freedom). This means two important things: there are no licensing fees for GnuCash and never will be, and any GnuCash user is free to download the source code to add features or fix bugs, or hire the programmer of their choice to do so on their behalf. See http://www.gnu.org/philosophy/ for more information about the philosophy of the GNU Project and the Free Software Foundation.

Posted by Shawn K. Quinn at 26 August 2010

Category: Uncategorized

This is kind of a random list of various penny-pinching skin, hair, nail, and body care tips I’ve learned over the years, somewhat out of necessity. Yes, this article applies almost equally to men as much as women.

General

Compare unit prices (price per ounce, liter, gram, kilogram) to make sure you’re making a properly informed decision. If you have two bottles of facial cleanser, one for ¤10 for 500 mL, another for ¤6 for 250 mL, do the math and realize the ¤10 bottle is the better deal from a unit pricing standpoint (all other things being equal).

Skin care

A lot of people swear by the adage “you get what you pay for” when it comes to skin care products. I’ve heard of certain masks (usually spelled “masques” at this price point), cleansers, scrubs, etc. sold at truly frightening prices. The quality tends to go up a bit as the price increases but beyond a certain point the difference is truly negligible and there are exceptions to the rule where products at a lower price point are actually better than those at a higher price point.

At least some of the time, “for men” packaging and branding is an excuse to pad the profit margin just a bit more. Of course, sometimes the “for men” products are truly a different product, but often not. The thing that the manufacturers are counting on, of course, is that men won’t bother to comparison shop with similar products not marked “for men,” won’t consider it an “apples to apples” comparison, or are willing to pay significantly higher prices just for silly differences like a different scent. You don’t have to play into their hands.

Baking soda can be used as a scrub by mixing with water, lotion, or cleanser.
Planet Green has more information on how to do this.

Body care:

One can make one’s own body powder with ingredients such as cornstarch and baking soda. http://www.rachelssupply.com/dust.htm has a few recipes as well as the ingredients themselves.

In a real pinch, cornstarch can be used by itself; it is the primary ingredient in most bath powders and many baby powders, though it will cake up a bit in the absence of an anti-caking agent (the most common being tricalcium phosphate). One may also mix cornstarch with another cornstarch-based powder to stretch an existing supply.

Nail care:

If you’re out of money for nail polish or remover, or don’t like the look of polished nails, try a nail buffer, usually available for less than the cost of one bottle of polish, but will last much longer. There are two-step, three-step, and four-step versions; some of the four-step versions contain a side that is actually designed for smoothing the edge of the nail, not the surface. I recently scored a two-step buffer at a local drugstore for $2.59, usually smaller versions with three steps are available for $2 or less. Sometimes the quality is lacking at dollar stores though.

Posted by Shawn K. Quinn at 23 July 2010

Category: Uncategorized

As recently posted on creditcards.com, with the change in credit card regulations comes the greedy credit card banks looking to replace lost income. Some of these aren’t exactly new but worth mentioning nonetheless. In summary:

  • Reward redemption fees: This borders on bait-and-switch, offering a “reward” and then charging to redeem it. Supposedly for administrative expenses, this is typically no more than $50, and is often waived if you register online.

  • Foreign transaction fees: You need not actually travel to incur this, just involve a foreign bank somehow, and poof! Instant fee. This is usually up to 3% of transaction amount. If you’re travelling abroad, you can possibly get a better deal by using traveler’s checks denominated in the destination country’s currency. (note: not a traveler’s check card, which is a prepaid debit card and usually much more expensive)

  • Reward recovery fee: Charged to reinstate reward points withdrawn due to default (not paying on time). Highly variable; American Express charges $29, some issuers don’t charge it at all even if the terms say they reserve the right to.

  • Activity fee: Ironically, replaces the former inactivity fee limited by the Credit CARD Act to cards unused for over a year. Now, card issuers charge $50 to $100 and rebate it if you charge over a certain amount per year. (Probably not what the legislators that wrote the Credit CARD Act had in mind, either.)

  • Payment protection fees: This is a completely optional insurance plan that costs around .9% of your balance (90 cents per $100). It’s not called insurance, of course, but that’s what it is. Best avoided if you carry a large balance; the money can be put aside into a savings account instead where it’s earning interest for you. This can be a significant amount: for a $5,000 balance, about $45 per month. Over a year that’s $540, which should easily cover six months of minimum payments. Another way to look at it: that .9% per month is comparable to an additional 10.8% APR. There’s an easy way around this one: don’t sign up for it.

  • Paper statement fees: Not surprisingly in our increasingly electronic era, banks now charge to mail out hard copy. At least some banks are; I’d expect this to become more common in the coming years but it’s not terribly common right now. As long as the fee is reasonable (about $1-2 per month) it’s no huge cause for concern if you actually need a paper statement, but just say no to unmitigated greed such as Bank of America’s $9 per month paper statement fee.

Moral of the story: read the terms and conditions of your cards and accounts carefully and keep track of changes to them. If you find something that’s outrageous, take it up with your bank/card issuer, and start looking for alternatives. Most changes in terms and conditions will not affect you if you quit using your card before they take effect and you inform the issuer you wish to close your account.

Posted by Shawn K. Quinn at 19 March 2010

Category: Uncategorized

As detailed in this WalletPop article, there is a forthcoming change in how banks handle debit card transactions. If you are in the US and you have a bank account, you have probably gotten something in the mail or with your online statement about opting in to continue something like “courtesy pay” or “bounce protection.” I’m going to explain why it is a bad idea to opt-in and why the opt-in requirement came about.

Until 2010 July 01, financial institutions (banks and credit unions) are allowed to accept debit card transactions which would take the balance negative, at their discretion (usually up to a negative balance of $200 or $300, sometimes more than that). The institution charges a fee per occurence, typically in the $25 to $40 range (sometimes capped at two, three, or four fees per day). Until recently this was a huge revenue stream especially for for-profit banks, but it came at the expense of those who could least afford the fees. (The APR for an overdraft equal to the overdraft fee ($25 for a $25 overdraft, etc) for one day is 36,500% and is even higher for overdrafts where the fee exceeds the transaction amount. This makes payday loans look like a bargain.)

The banks (and even some credit unions) are using heavy-handed, aggressive scare tactics to try and convince people to opt-in to continue this “protection.” They cite such things as being stranded with no money and the fee being a relative bargain by comparison. The reality is, the computers behind debit card transaction approvals are stupid and will just as easily charge the fee for going one penny over at a coffee shop as they will for an emergency tow or car repair. Of course they will! The banks have no reason to tell the difference and a typical overdraft fee is almost pure profit!

My advice is simple: don’t opt-in. If you need an emergency credit card with, say, a $500 limit, get one, and then use it only for emergencies. If you decide to ignore my advice and opt-in to a “courtesy pay” arrangement anyway, keep close tabs on your account balance, and only overdraw a deposit account as a last resort.

A similar rule has already gone into effect for credit cards and discretionary overlimit approvals. I advise not opting in to these either, for similar reasons.

Posted by Shawn K. Quinn at 20 January 2010

Category: Uncategorized

I’m going to go ahead and come out and say what’s pretty obvious by now.

I had rather high hopes when I started this blog. I never really had the time or the interest I had hoped to maintain at the time I started it.

As of now, I’m probably going to make one to three more posts, and then put the lid on it. I’m not sure if I want to keep the domain, but I will probably move the archives elsewhere at some point. Since few really read this one and nobody has really made comments of substance, I may well turn it into a static HTML site and close the comments when the time comes. Because I do want to keep what I have written here, even if I feel the time to add to it has come and gone.

I’d rather run two successful blogs–Rant Roulette and Quinn’s Big City–and leave it at that. It’s disappointing to admit failure and disappointing to know I’ve let down some of my readers and fans. It’s necessary to admit that, though, to move forward.

That’s all I feel I should say here. I will probably write a more substantiative post about this on Rant Roulette in the coming days.

Posted by Shawn K. Quinn at 28 December 2009

Category: Uncategorized

I know, it’s been a while. But I’m back here. Really, in 2010 you’re going to see a lot more posted here. I’m not happy with the relatively low article count here and I know the rest of you probably are not either.

For those that never really understood it, I’m going to write a quick little blurb on buying in bulk and unit pricing. This is also going to debut what’s going to be a new standard on this blog: use of the ISO non-country-specific currency symbol ¤ where the actual unit doesn’t really matter. Feel free to mentally replace ¤ with $, £, €, ¥, etc. and adjust.

Unit pricing is calculated by taking the price of the item and dividing by the amount of product contained within. It is important to know how to calculate unit pricing because sometimes stores mark down smaller price items and sometimes these smaller size items are temporarily a better deal than buying the larger size items.

Consider the following example for a store’s regular prices (plausible, but completely fictitious, I just made these up):

¤0.60 for a 12 oz. (355 mL) can of soda
¤2.50 for a six-pack of 12 oz. cans of soda (72 oz., 2.13 L)
¤4.50 for a twelve-pack of 12 oz. cans of soda (144 oz., 4.26 L)
¤1.90 for a 2 L bottle of soda
¤2.75 for a 3 L bottle of soda

Calculating unit prices for all of these (per liter, just for an example, rounded off to the nearest ¤0.01/L):

¤0.60 / 0.355 L = ¤1.69/L
¤2.50 / 2.13 L  = ¤1.17/L
¤4.50 / 4.26 L  = ¤1.05/L
¤1.90 / 2 L     = ¤0.95/L
¤2.75 / 3 L     = ¤0.92/L

As you can see, the 3 L bottle is the best deal, judging by unit price. Now, that does not always mean it is the best deal. Certain circumstances may make large bottles impractical, such as when one is hosting a party. To go along with those bottled sodas, one must then purchase plastic cups, keep ice handy, etc. When going on a road trip it’s much easier to throw twelve cans in an ice-filled cooler and drink straight out of the can, versus fiddling with larger bottles and cups. If inconvenience outweighs the lower cost, it’s not really a better deal at all.

Now, let’s say this particular supermarket marks down the 2L bottles to ¤1.60. The new unit price then becomes:

¤1.60 / 2 L = ¤0.80/L

One can easily see this works out well for the observant shopper (and yes, this really does happen, it's beyond the scope of this post for me to elaborate why). Another example, assuming the above markdown is no longer in effect, and this market has instead marked down twelve-packs of cans to ¤3.80:

¤3.80 / 4.26 L  = ¤0.89/L

This would be the best available price, beating out even the regular price for 3L bottles (this also happens in the real world, but is a bit rarer as packaging is much more expensive than the soda itself, especially when aluminum is involved.).

There are cases, however, where it does not make sense to buy in bulk, particularly for items with limited shelf life: milk, fruit juices, butter, meats, and even in some cases sugar, flour, salt, and similar items.

There is also one's current situation to consider. The reason stores (especially corner/convenience stores) sell single cans or bottles of soda (at a unit price typically twice that of a six- or twelve-pack) is that it is often more convenient to buy a single item than bother storing and carrying around a larger package. Use this to your advantage: if you're with a couple of buddies, instead of everyone grabbing a single can of soda, consider splitting a six- or twelve-pack or a 2L bottle; even after everyone buys a cup of ice, you are still very likely to come out ahead!

Posted by Shawn K. Quinn at 30 October 2009

Category: Uncategorized

Yeah, I know it’s been darn near two months since I’ve updated this thing. I have a much more substantial post in the works but I’ll just post this one tip for now.

It has to do with credit and debit cards with the Visa or Mastercard logo and minimum purchase requirements imposed by the merchant. Usually convenience stores do this and the minimum is anywhere from $3 to $5 (US), but I’ve seen at least one bar with a $10 minimum posted on a sign, and apparently in some areas $10 minimum purchases are more common at grocery stores.

To make a long story short, the merchants aren’t allowed to do this for Visa and Mastercard. Technically, they are allowed to do this for American Express and Discover, if and only if they impose a minimum for all credit cards, which is unlikely given both Visa and Mastercard forbid it. So, unless American Express or Discover are the only credit cards a store accepts, a minimum purchase to use a credit or debit card is a violation of the merchant agreement.

This post at nontoxicreviews.com goes into more detail and also has a handy wallet-sized card you can print out and carry with you.

Posted by Shawn K. Quinn at 23 August 2009

Category: Uncategorized

It wasn’t all that long ago that mobile phones were a relative novelty; now it is the exception, not the rule, for anyone who goes anywhere on a regular basis not to have a mobile phone. For those considering or re-considering their mobile phone needs, the options available can be confusing.

For those who do not make or receive very many calls, it is worth considering a prepaid phone plan. Prepaid plans charge a set amount per minute, typically US$0.20/minute in the US as of the time of this writing. Some carriers offer discounts for night/weekend usage. Some offer discounts for loading more than a certain amount at a time (i.e. US$60 worth of minutes on a US$50 reload).

The catch with prepaid plans is typically that one must reload at least once every 30 days, sometimes longer for larger reloads. If it is important that one keeps the same phone number, one should keep enough cash on hand to buy one reload of the smallest denomination just in case. The possibility of buying a bunch of minutes at once and then using minimal reloads to keep the phone number active may be worth looking into if it is a good fit for one’s usage pattern. Keep in mind, with prepaid service, if an account expires the minutes/amount remaining on it are often lost.

The next step up is a monthly service plan. Many mobile phone providers offer a contract service where the month is paid for in advance instead of given on credit, with a side account used for overages, ringtones, premium downloads, etc. similar to a prepaid phone. Except for the fact one pays for the service in advance, these function almost identically to a standard post-paid plan.

The catch with monthly plans is that often one must commit to at least one, often two years of service, with a quite substantial (US$150 to US$200 being typical) cancellation penalty. This is typical with the case of buying a new phone from that carrier. With GSM phones (AT&T and T-Mobile in the US), if one already has a phone and it is unlocked, a carrier switch is usually as simple as swapping out SIM cards (a smart card which is used by the phone to identify each account holder and telephone number). Other carriers typically require you to buy a new phone for their network, as other types of phones embed the subscriber information in the phone itself in a non-user-servicable form.

One may choose to pay the full cost of the phone up front instead of signing the two-year contract. This may make sense for those who know they will need service in excess of an amount to be financially viable for prepaid, yet for less than the contract length.

The rationale for requiring the contract is that the true cost of a wireless phone handset is more in line with the non-contract price, and wireless phone companies subsidise some of the cost to get more customers, in exchange for loyalty over the contract term, making the money back from monthly fees. The wireless carrier will easily make back the subsidy on a “free” phone over the two-year contract.

Another surprise with monthly plans, is it’s easy for one to fall prey to a slick salesperson who will gladly sign one up for a 1000-minute plan, when a, say, 300-minute plan is actually a better fit. A good rule of thumb, the one I would use, is that you should ideally be using between 75% and 100% of the minutes on a plan every month, except for unlimited plans.

There is also a slightly more nerdy way of figuring what the difference between two monthly plans would buy you as an overage fee, and add the number of minutes to the lower plan. Example: 600-minute plan for US$70, 1000-minute plan for US$90, US$0.20/minute for overage. The difference is US$20, or 100 minutes, implying that even if one regularly goes over the 600 minutes in that plan by small amounts of less than 100 minutes per month, it’s still a better fit than the 1000-minute plan where that US$10 is being paid every month and most of it is not being used. This is the only way to gauge whether or not an unlimited plan is appropriate, and you should compare unlimited against the most expensive limited plan available with a price less than the unlimited plan.

Now, it should be no big surprise that what the wireless carriers are banking on is that those with 600-minute plans will go over by much more than that. The moral of the story: check your minutes remaining, and check it often, especially after long calls during peak usage hours.

Text messaging is another way to wind up poorer than expected, and should be checked in a similar way to voice service usage. If you plan to text often, you should definitely sign up for a text message bundle. Roughly the same rules apply to messaging bundles as voice usage.

I wrote an article in my personal blog back in 2008 December about the huge discrepancy between what it costs wireless carriers to provide text messages, and what is charged. I consider it especially important to not run up a huge bill by text messaging for this reason, though it is far from the only costly mistake one can make with a mobile phone. (Due to the fact I often use Twitter via text message, I have an unlimited plan; it’s not an appropriate choice for everyone, for most people who either don’t use Twitter via SMS and don’t do all that much texting, one of the smaller bundles, typically 500 or 1000 messages, is usually sufficient.)

Posted by Shawn K. Quinn at 13 August 2009

Category: Uncategorized

Either by choice or not, many residents of large cities sooner or later wind up using public transit (bus or rail) to get around town. Being in that situation myself for the moment, I figure it’s time I share a few tricks and tips.

I happen to focus most of my examples on systems in Texas. I’ve gathered the information for systems outside of Houston from the agency Web sites.

The first is to know your system’s transfer policy. On Houston’s Metro system, the only way to transfer for free is to use a stored value smart card (Q Card) for fare payment, with the transfer being stored automatically on the card. Cash-paying riders are confined to one route or get to pay twice (or more). Some systems such as Via in San Antonio charge a small amount on top of the base fare for a transfer. Others such as Capital Metro in Austin do not issue transfers at all.

Many systems, especially ones like Capital Metro that do not offer transfers, usually do offer a day pass. If you plan to really ride around town this is an option well worth considering. Even for systems that do not offer a day pass, a weekly, monthly, or yearly pass may be available.

If you plan to ride frequently but not daily, a stored value card (if offered by your system) may be worth considering.

Most systems offer express or non-stop service, usually aimed at commuters. If time is of the essence and an express or non-stop route is available, it may be worth the higher fare.

Some systems have a zone-based fare system. Dallas’s DART and Fort Worth’s The T systems work similarly to one multi-zone system in practice, where riders have the option of a local or premium pass.

Do be aware that exact change requirements are the rule, not the exception. Take care of your transfer or day pass; usually these items must not be folded or torn. Take especially good care of longer timed passes; having to purchase a replacement for a damaged yearly pass could potentially be expensive.

And finally, this could save you a huge taxi fare bill: check and double-check the schedules for the routes you are riding. Nothing will ruin an otherwise good day like missing the last bus home, especially not knowing one has until after a long wait for a bus that’s not arriving.