If you live in the Midwest, you probably already know about the home improvement store Menards and their fantastic 11% rebate sales. What you may not know, is that Home Depot has a double secret probation rebate match program.
https://www.homedepotrebates.com/11percentmatch/
Whenever Menards is running an 11% rebate sale, Home Depot also runs a corresponding “Rebate Match” sale. The only difference is that Home Depot does not advertise it in any way that I’ve seen.
This is the first time that I am trying to take advantage of the secret match program. Hopefully my submission results in success. I have read on various forums that Home Depot does limit this to areas where Menards exists, so if you aren’t in the Midwest you might still be screwed.
The crushing summer heat and humidity are on their way out. We have been relying on three box fans to help keep the house from getting too stuffy this summer, so it was very noticeable when one of them broke.
To be more specific, the little plastic speed dial had fatigued and the teeth inside it that grip the motor post had snapped off. You could twist and twist all day long, but it was no longer turning the post below that connects to the motor.
I could have gone to Wally world and spent $15-20 on a replacement fan, but I figured there was a cheaper fix. Using a little hot glue, I re-attached the dial with post below it.
After letting it ‘cure’ for 30 minutes it was as good as new. Super glue also probably would have worked, but I knew where the hot glue gun was.
The book by Tim Leffel looks at how to get more out of your (international) vacations while spending less. Who wouldn’t want that?
I have read through the first two of three sections in the book. In section one, Tim talks about the big expenses associated with travel and how two hypothetical families, the Smiths and the Johnsons, waste and save money on airfare and lodging. The second section talks about dining, ground transportation, and souvenir shopping.
The essence of Tim’s travel philosophy is that the best trips and cheapest trips happen when we avoid the American pretense of travel. If I asked you to name a good beach destination, you would probably respond with Florida, Hawaii, or the Bahamas. The reason why those places come to mind is that they are heavily marketed. Those big budget ad campaigns come out of the pockets of tourists. In one example given in the book, a resort in the Bahamas got caught red handed publishing pamphlets of their resort with images of beaches found in Florida. Their response, “beaches all look the same anyway”. So if beaches all look the same, why spend big bucks to go to a well marketed one?
The theme of getting off the beaten track, avoiding the herd, and walking/talking/eating like a local is repeated frequently in the book. In many ways it reminded me of our recent trip to Mexico where we stayed in local apartments, ate at a food truck and other hole-in-the-walls, and swam in the local swimming hole.
I would recommend that you pick this book up and give it a read if you have ever only stayed at resorts or chain hotels, use tour buses, and never stray far from the touristy areas. If that doesn’t describe you, then you could probably skip this book.
Do you want to save $50-$100 bucks in five minutes? Of course you do! Keep reading to learn how.
Did you know that you can shop around and choose what company you buy energy from? That’s right, you don’t have to purchase your electricity or gas from the company that pipes it to your door. Our municipality just negotiated a new two year contract on behalf of residents for electric and after seeing the results of said negotiations I was left with more questions than answers.
The new two year fixed opt-out rate is for 5.6¢ per kilowatt hour (kWh) plus an additional 0.1¢ city imposed fee on top of that for managing the aggregation program. That rate is for raw energy, and that energy still has to get from where it is generated to your house, and that is the distribution charge that you pay to your electric company. In our case, we have Ameren. Ameren’s website has a list of suppliers that you can purchase from so I did what any good nerd would do and opened up a blank spreadsheet and got to work.
Here is the result of a lunch break’s worth of internet sleuthing (click on it for a PDF version).
Most of the suppliers were more costly than the negotiated aggregate rate. I would kind of hope that the collective bargaining power of 30,000+ households could beat an anonymous internet quote. With that said, there were two suppliers that offered better one year fixed rates than the default Homefield Energy.
MidAmerican Energy offers a 4.54¢/kWh one year fixed rate with no cancellation fee. Viridian Energy offers a slightly higher 5.49¢/kWh one year fixed rate with a cancellation fee. Both options beat the city negotiated rate.
Apples to Oranges
I hear you saying, “Okay Andrew, this isn’t a very good comparison.” These lower rates are one year vs two year, and that is true. In order for it to balance out, rates in the second year would have to increase to 6.7¢/kWh for MidAmerican Energy. A number that is hardly even seen on the price matrix as of today. I would peg the probability of such a rate increase in one year’s time as very small.
“Well, what about the environment Mr. Smart Guy?!” Each energy supplier has their own breakdown of how their energy is generated (MidAmerican, Homefield Energy). Coal, one of the worst polluters is also one of the cheapest forms of electric generation. So how do Homefield Energy and MidAmerican Energy compete in terms of ‘greenness’?
Taking coal and natural gas together (arguably the two worst polluters) pins Homefield Energy as the dirtier supplier with 72.33% of their electrical generation coming from those two sources. So in this case, it is not a matter of paying more to Homefield because they offer cleaner electrons. In fact, MidAmerican has about 30% renewable energy (in the form of wind) compared to Homefield’s dismal 6%.
A Penny or Two Matters
So MidAmerican is cheaper and cleaner, but does it really matter to John and Jane Doe consumer? I mean, it is only 1.06¢ difference per kWh. According to U.S. Energy Information Administration, EIA, the average U.S. residential utility customer used 10,908 kWh in 2013. Multiply that usage by the cost difference between these two suppliers (.0106) and you end up with $115.62 in savings per year. Not too shabby for spending 5 minutes on an enrollment website. We personally stand to save about $58 based off our usage (5514 kWh) in 2014. Alternatively, we could spend an extra $50 and go with Viridian’s 100% renewable one year rate at 6.49¢/kWh.
Aggregate Contract?
At the end of my hour traipse through different electric supplier’s websites I am still left with the question of why our municipality agreed to the contract that they did. There are cheaper options available and there are greener options as well. Heck, for a cash strapped city that is always claiming to look for more revenue, it doesn’t take much creativity to set the opt-out rate at MidAmerican’s low price of 4.54¢/kWh and then add on a surcharge of 1.06¢/kWh to bring it up to their current contract rate. The city would pocket about 3.9 million dollars!!
The precedent for adding a surcharge is already there, they currently add one and nobody has raised a fuss. A spokesperson for one energy supplier said that less than 10% of customers opt out of aggregate contracts. Most people simply don’t care.
Perhaps MidAmerican couldn’t generate enough electricity for 30,000 households. That still leaves the possibility of using Viridian’s one year fixed rate @ 5.49¢/kWh. Not only is it 50% renewable, quite an improvement over 6%, but if the same money raking strategy was employed here the city would still be able to generate over $400k in revenue.
I may be missing a piece of the puzzle, but it seems to me that there is a drastically better solution available than the one that has been presented to the public. The current 0.1¢ surcharge to manage the aggregate program is estimated to generate about $370,000. I spent a lunch break and found a better rate.
Yesterday I mailed off our federal and state tax returns. 2014 was a good year for us, both in income and reducing our tax burden. Reducing the amount of taxes that you pay is in my opinion, the best way to increase savings. You don’t have to work any harder (more hours, second job, etc.) and you don’t have to decrease your spending (i.e. being frugal).
Our marginal tax bracket was 25%, but by contributing to tax advantaged retirement accounts, like a 401k, we were able to drop down into the 15% marginal tax bracket.
Our effective tax rate, what percentage of our income we actually had to pay after all of the deductions and credits was 10.96%. In other words, we had to earn $1.12 in order to spend $1. You can figure your own effective tax rate by dividing your total tax (line 63 of form 1040) by your total income (line 22 of form 1040).
The following chart from 2010 shows effective tax rates (AGI instead of net income) grouped according to the income earned. Our rate is high for our income because it includes the self employment tax (social security and medicaid that is normally paid by your employer). If we fiddled with our numbers and took out the self employment tax and used adjusted gross income instead of net, our rate would be 6.2%
All in all, I feel like we are successfully managing our tax burden.
Some other points of interest
Our effective rate dropped about 1% point from 2013, thanks largely in part to Frugal Boy. The extra deductions and credits that come with having a dependent make a sizable difference in your tax bill.
Here are some previous blog posts about reducing one’s tax burden:
