library – Page 2 – Frugal Living

Freebie Extravaganza

April 19, 2015 by Andrew 1 Comment

It has been a jam packed weekend for us with lots of freebies!

A Free Chair

Here is a free chair that I found on Friday. The upholstering is a bit rough but it is a solid chair. The label on the bottom says Fairfield, so someone probably paid a few hundred bucks once upon a time.

Free Movie Rentals

Redbox is running a deal right now (PLKMP982) where you can get five free DVD rentals for each account that you have with them. The deal runs until 4/30 and you must reserve your DVD online (the code won’t work at the kiosk).

So far we have watched Interstellar and The Imitation Game. Both excellent movies that you should watch if you haven’t already!

Free Laundry Detergent +

On Saturday, there was a cloth diaper expo in town. The first twenty people got goodie bags. We happened to be walking nearby so we stopped in and got a large bag filled with detergent, an insert, various balms, and literature.

Free Charcoal Grill!

Also on Saturday we won a free charcoal grill as part of a city wide scavenger hunt.

Our local library has been promoting National Library Week and the rollout of their brand new bookmobile by posting a scavenger hunt on Facebook every day for the past week. It has been really fun to try and figure out the clues and race across town to get to the destination before other treasure seekers. The prizes were usually claimed within 10-20 minutes of the first clue being posted and twice we were in sight of the goal line just to see someone else get their first. The last prizes clue started with:

Subtract the number of dwarves from a baker’s dozen
Add the number of blind mice to the loneliest number
Subtract the number of calling birds from the number of gold rings

My gut told me that it was a call number so we went to the library. We had books to return and they were having cake to celebrate the new bookmobile so even if I was wrong we would still score some free cake!

After getting to the library the second part of the clue was posted

.LVII
Add the value of two quarters to Walter Payton’s number
“Bam!” You got it!

I’ll leave the answer at the end of the post so you can see if you figured it out.

Here was Shae with the prize envelope. We were so thrilled to have found one and win a prize!

Then we took a group selfie to commemorate the occasion. Frugal Boy was obviously not as excited as his parents, but he’ll come around after he gets to eat some meat seared over red hot coals.

After eating some free cake and checking out the snazzy new bookmobile we headed home.

Free Garage Door Fix

Arriving home I pressed the button to open our garage door and the door shook a lot on the way up and then stopped 3/4 of the way. In the words of Frugal Boy, “Uh Oooh!”

The culprit was easy to spot. One of the rollers had dragged and bent its hinge completely out of alignment.

I grabbed some tools and pulled the broken hardware off the door.

My first attempt to fix the door was to go to Lowes and buy a new hinge and ten new rollers. Our garage door dates back to the 70s and as this little incident proved, it is on its last legs. Returning home, I lined up the new hinge where the old one was and discovered that it was incompatible. The replacement hinge was far too tall and if I screwed it into place then the roller wouldn’t line up with the track. I would have to move the entire track back at least 1/2″ to accommodate the replacement parts. To add insult to injury, the new rollers are too thick to fit into the old hinges.

In a last ditch effort, I resorted to Great Depression tactics and laid the old hinge on the garage floor and beat the snot out of it with a four pound hammer until it was straightened out again. I also tightened up and replaced any missing nuts that had shaken loose from 40 years of operation. So far so good and the fix was free!

Free Car (Blocks Sold Separately)

Saturday night, Shae asked me if I wanted to come with her to walk around the neighborhood to find any curbside deals. A couple of blocks away we found a Little Tikes Cozy Coupe. I asked the man outside of the house if we could have it and he was more than happy to let us drag it away. He said that they had inherited it with the house and his kids had ridden it pretty hard. The front wheels were bent and one of the columns had been ‘repaired’ long ago.

This morning we went back to Lowes to return the incompatible garage hardware and to pick up some new wheels for Frugal Boy’s pimpin ride.

A couple of casters, long carriage bolts, some scrap wood, and a little ingenuity had Frugal Boy’s ride back on the street, err alley, err garage (it was raining today).

So there you have it, our freebie filled weekend! I still have to assemble the grill and break it in sometime, we have three more redbox movies to rent, leave a recommendation down in the comments, and our garage door is running on borrowed time.

Scavenger Hunt Answer

641.5784 which refers to a section of grilling cookbooks in the Adult Services Department. The reference to “Bam!” was intended to narrow down the options to Emeril Lagasse’s cookbook “Emeril at the Grill: A Cookbook for all Seasons.”

Frugal Book Club #6 – The Bogleheads’ Guide to Investing

February 8, 2015 by Andrew Leave a Comment

If I had to recommend just one book about investing, I would recommend The Bogleheads’ Guide to Investing. It presents information in a very easy to digest format and the authors cover many different subjects that are relevant to all stages of life, from what to do with that first paycheck, all the way to how to plan an estate.

I was able to skim through the book in a single night, mostly because I am already familiar with the Boglehead approach to investing. Hint, it is the same one advocated by Vanguard.

So if you haven’t jumped into the investment pool yet because of fears or apprehension, then this is the book for you. If you are already swimming in the waters and want a refresher, this is also the book for you.

Frugal Book Club #5 – Deflation

January 26, 2015 by Andrew Leave a Comment

Deflation, by Chris Farrell, covers a topic that is almost unheard of in present day America, what happens when prices fall? We are so accustomed to inflation, the opposite of deflation, where prices rise over time and a dollar is worth less tomorrow than it is today that we hardly even think about deflation.

In his book, Mr Farrell argues that the next century will be ruled by deflation. He pins the trend reversal on increasing globalization, the spread of capitalism, and the internet. I can attest to the internet’s deflationary power because I experience it first hand with my software business. Not only can I sell to customers around the world, I also have to compete with other companies around the world. Some of those companies reside in 2nd or 3rd world countries with lower costs of living and lower income needs. That means they can drag my prices down. To remain competitive, companies including my own lose pricing power and the customer gains it.

It sounds like deflation is a great thing for John and Jane Doe consumer right? Well, as companies lower prices to remain competitive, they bring in less revenue. Why should I buy a car today when it will be cheaper tomorrow? With less revenue due to slimmer margins and deferred sales, businesses cannot support their payroll expenses. Worker wages are often referred to as “sticky”, meaning that workers are resistant to lowering wages. Who *wants* to have their income cut?! When a business cannot lower wages across the board, they resort to laying off workers. Sure, a carton of eggs in deflationary times might only cost 50¢ but that doesn’t help the unemployed person very much.

The biggest losers in a prolonged deflation are debt holders. The “Buy it now, pay for it later” mentality of inflationary times does not transition well to a deflationary setting. Consider this scenario. John Doe buys a house with a $250,000 30 year mortgage at 4%. At the time he buys the house, he is making the median American income of $50,000. The monthly mortgage payment is around $1200. That would peg his yearly housing costs around 29%, a number that falls into the popular rule of thumb to keep housing costs below 30% of gross income. Fifteen years later amidst constant deflation and his income may have been reduced to $30,000, but his mortgage has not deflated. It now consumes 48% of his gross income. Everything else that John buys costs less due to deflation, but his mortgage payment has not decreased.

Is Mr. Farrell a doomsday sayer or is there some merit to his predictions? According to Vanguard’s 2015 Global Economic and Investment Outlook deflation is a concern of well learned economists.

A deflationary threat will likely continue to hover over the world. In aggregate, reflationary monetary policies will continue to counteract the disinflationary drag of post-financial crisis global deleveraging. As suggested in Vanguard’s past outlooks, recent consumer price inflation remains near generational lows and, in several major economies, is below the targeted inflation rate.

Key drivers of U.S. consumer inflation generally point to price stability, with core inflation in the 1%–3% range over the next several years. Nascent wage pressures should build in the United States in 2015 and beyond, but low commodity prices and the prospects of a strong U.S. dollar should keep inflation expectations anchored. In Europe, deflation remains a significant risk that will not soon disappear

Some of those words might have stuck out to you, like “targeted inflation rate” and “price stability”. After learning hard lessons over the past century, central banks have agreed that a targeted inflation rate of about 2% is ideal. They try and control that by raising or lowering interest rates (this is what ultimately sets your mortgage rate) and adding or removing money from circulation (liquidity).

I wouldn’t recommend the book Deflation to anyone unless they were die hard monetary fans. The book reads a lot like a term paper or thesis and tends to take its time snaking around various historic examples and anecdotes to make its points. I had to check it out of the library twice and still gave up before finishing it. You can read more about macro economics (what inflation and deflation are categorized under) on this website.

Frugal Book Club #2

June 29, 2014 by Andrew Leave a Comment

I mentioned previously that we are participating in our library’s Summer reading program. The first book that I read was the Millionaire Next Door by Stanley and Danko. It was an interesting book and worth the read. The book, published in 1995, did feel dated at times, especially when talking about average incomes. It also made no mention of the burgeoning field of technology and all of the entrepreneurship opportunities there (the book talks a lot about how self employed individuals are statistically more likely to be millionaires compared to their rank and file counterparts).

The big takeaway that the authors hammer away at for the duration of the book is that wealthy individuals live below their means. In other words, they are frugal. Keeping up with the Joneses is stupid, because the Jones don’t have any money, they spend it all and spend everything that they can borrow. I like to think that we are living below our means. We have been in our house for 13 months now and have paid off 20% of the mortgage. Contrast that to the Joneses who most likely have a 30 year loan and would only be 3.6% done. How have we paid off so much of our mortgage in so little time? We live below our means and have started making quadruple mortgage payments each month. We also saved up before buying and were able to put down 66% on the house. If you put down less than 20% you are usually hit with PMI, private mortgage insurance. Those 3 little letters can add a substantial amount to your monthly mortgage payment so it is best to put at least 20% down on a house.

At this point, you may be wondering “What’s the point of being wealthy if you don’t spend money?” According to Stanley and Danko, millionaires do spend money on priorities such as tuition for their children and grandchildren, professional services including health care, accountants, and lawyers, and investing in their retirement accounts. The last one is most likely the largest motivator to accumulate wealth. Financial Independence, or the ability to live off one’s accumulated wealth without having to work to pay for necessities is the cornerstone of retirement.

The American dream/promise is that if you put in your 35-45 years of work, you can retire and laze about while enjoying the lifestyle that you had whilst working. The reality is that many Americans cannot afford to retire or maintain their lifestyles due to small savings and/or having a lifestyle beyond their means.

Retirement is a privilege, not a right

If that sounds too harsh read some of the statistics out there about the impending retirement catastrophe (okay the article and my wording are a wee bit hyperbolic, but my point remains).

Now for something completely different

I’ll step off my personal finance soapbox for now and pick up the next book on my reading list, Do Father’s Matter? by Paul Raeburn. I have read through the first chapter and so far the most interesting topic has been epigenetic inheritance. Way back when in 9th grade biology class, I was taught that a new living organism developed according to its DNA ‘blueprint’. My limited understanding of epigenetics is that they are kind of like doodles on the blueprint. Most of the time they are ignored or wiped off completely, but sometimes they affect the developing organism. In this way, it is possible for a male’s sperm to contain information in addition to the DNA. This information, according to Raeburn, acts as an environmental weather forecast for the developing fetus. “Hey fetus, there is no food out here in the real world, so turn on the genes that help you fend off starvation”. In this way, a father’s health at the time of conception plays a large role in the resultant baby just like the mother’s nutrition during pregnancy affects the fetus.

Pretty neat stuff.

Free Summer Fun

June 6, 2014 by Andrew 1 Comment

School is out for summer around here and that means that Summer reading programs are starting up. Our public library offers three programs, one for kids, one for teens, and even one for adults. Signing up was as easy as going online and filling out a form. All we have to do to complete the program is read 22 hours worth by August. Participants who complete the requirements are entered into a drawing for prizes. Last year they gave away nice things like iPads. Not a bad deal eh?!

We have been going to bed much earlier now that Frugal Boy is starting to get into a bit of a routine. Reading before bed is a great way to relax and unwind from a long day and it also makes reaching that 22 hour goal a walk in the park.

The first book that I am reading for the program is The Millionaire Next Door. I’m about a 3rd of the way through the book and it has had some good points even if it takes a long path to get there.

The book starts by categorizing everyone into 3 groups, under accumulators, average accumulators, and prodigious accumulators. It does so by using a somewhat controversial formula to determine one’s expected net worth.

Expected Net Worth = Age * Gross Realized Annual Income * 0.1

If your spouse works, then average your age and use your household income. Your net worth should include all of your assets (including house) minus any liabilities (mortgage, car payments, student loans, etc).

The authors say that anyone with half the expected net worth is an under accumulator of wealth and anyone with double the expected is a prodigious accumulator of wealth. Everyone else is average. Our ratio of 0.93 would place us in the average category.

The rest of the book goes on to examine why people are in the under or over groups. Most of it can be summarized by simply stating, wealthy individuals are frugal.

What books are you wanting to read this summer? By the way, if you have a public library, by all means use it. It is *free* only if you do not pay property taxes. Our *free* library cards cost us around $280 in taxes last year, so you’d better believe that we are going to try and get every dollar out of them.