Prepare to Refinance Your Home

If you own a home and have it mortgaged, now is the time to prepare yourself for refinancing. I am glad that I did, since January presented me with a one day dip, where I was able to refinance my home for 4.625% with absolutely no closing costs.

Yes, I was surprised to find a no closing cost mortgage, but a local credit union has it as one of their main offerings.

About a year ago I started my search for the best institution that offered the best closing costs and best rate around. Luckily, I found the local credit union. I kept in touch with the mortgage guy and made sure that I had all of my financials in order. When I saw the mortgage rates dip, I checked the credit union website daily.

I almost pulled the trigger at 4.875%, but decided to wait. The next day, the rate dipped to 4.625% and I hopped on board, having everything ready to go, and it was quite fortuitous, since the next day the rate went back up to 4.875%.

I am now waiting again to see if the rates will drop even further and then hopefully refinance again at an even lower rate. Since I have no closing costs, I do not have to wait for it to go down much to make it worth my while.

So, go out and find that institution that has the best combination of rates and closing costs and then jump on the deal when it presents itself.

(photo: akbar simonse)

FREE MP3 Download of Stephen Covey Book

You can download a FREE MP3 copy of Stephen Covey's Focus: Achieving Your Highest Priorities on the Franklin Planner website.

Link

Apply The Pareto Principle To Your Finances

A good rule for your personal finances is to apply the Pareto Principle to your personal finances on a regular basis. Whether that is yearly, quarterly or monthly is up to you. If you are unfamiliar with the Pareto Principle, you probably know it as the 80/20 rule. Applied to your own finances, you will probably find that 80% of your expenses come from 20% of your budget categories (housing, transportation, debt and taxes are probably that 20%).

Budget

On a macro level you should focus on that top 20% of areas that cost you 80% of your income. Once you have identified that top 20%, you can do the same thing to each of those areas and come up with what expenses in those areas make up the 80%. Any adjustments or changes you make in your behavior in those areas to minimize cost will have a dramatic effect on your budget.

For example, for the majority of us housing is our largest monthly expense. Housing costs include mortgage, taxes, insurance, utilities and upkeep. Within housing, the mortgage usually makes up the largest cost. If you could refinance your mortgage at a lower rate, while still keeping the length close to the same, you could save yourself thousands of dollars.

Savings

Applying the Pareto Principle to your savings and debt reduction helps you prioritize your expenditures in this area. In this case, you will want to prioritze your spending in these areas to that top 20%, where you are getting the best bang for your buck.

For example, if your company matches the first 6% of your income that goes into your retirement, that will be the first place for your savings and debt reduction dollars, since the 100% return (plus the long term growth of the investment) you will be receiving is higher than any debt that you could pay off.

The next area to focus on would probably be paying off your credit card debt. If the interest rate is high, you can pay the debt down or transfer the debt to another credit card with a much better interest rate.

You can keep going down your savings and debt choices in this way so that you are focusing your efforts in the areas that will have the greatest impact. Updating that list will guarantee that every dollar that you use in this area will give you the best bang for your buck.

Conclusion

Make applying the Pareto Principle to your personal finances a habit going forward. Focusing your efforts in that top 20% will dramatically increase your long term wealth.

TeleBlend: My Home Phone Service Provider

For years I used some form of AT&T for my landline - that was until VOIP became available. As is my custom, I am never a first adopter, nor even a second adopter of technology. I usually wait until there is a price point that is so undeniable that I must hop on board. That is what happened in July 2006.

Since I use Comcast Cable Internet as my internet provider, I decided that VOIP would help me cut my home telecommunications bill, which it did. Sunrocket was running a 2 year $199 all inclusive deal that I could not pass up. Even Clark Howard was touting them as a great choice for home phone service.

Everything went great for the first year. I had signed up through a shopping portal and got $75 Cash Back, then referred a family member for a $50 Target Gift Card. Then, in July 2007, 1 year after joining, Sunrocket went kaput. Many people bailed to other VOIP providers who were giving great deals to Sunrocket orphans. Many were giving the same $199 for 2 years deal.

Being my cautious self, I decided against jumping ship and dealt with "free" very interrupted service until such time as some company picked up the Sunrocket pieces. Since I received only 1 year of service, I put in a dispute with my credit card company and received about $50 in credit - not as much as I wanted, but at least it was something.

Finally, Sunrocket became TeleBlend. They offered a contract free $12.95 a month plan that had a majority of the Sunrocket options that I used (minus the international call credit). After taxes and fees, the service costs me $15.36 monthly. They have grandfathered me in at that rate. Any new customers would need to join at $15.95 monthly.

Though $15.36 is not as good a deals as $199 total for 2 years, it is still cheaper than I received through AT&T with a lot more bells and whistles. Since August 2007, my phone service has run pretty smoothly, with voice quality being higher than when I was with Sunrocket. Since I am not locked into a contract with Teleblend, I plan on staying with them until such a time that cell phone services make it interesting. It is getting close.

Can You Make Money on Prescriptions?

Over the last 6 months I have been able to find more and better ways of actually making money when I purchase a prescription.

As you can tell by the picture to the right, I get most of my prescriptions at CVS. Though they are not the cheapest drugstore, they are one of the most generous, when it comes to receiving gift cards for new or transferred prescriptions.

In this post I will talk mainly about new prescriptions, since tranferring a prescription seems to be too much a pain.

Over the last 6 months I have received coupons for a $25 CVS gift card with the purchase of a new or transferred prescription. By reading this thread at SlickDeals, I found that CVS honors most competitor coupons. Most of the coupons in that thread relate to transferred prescriptions, but there are posts related to coupons for new prescriptions.

I have been able to find competitor coupons to Target and Kmart for a $10 or $15 gift card with the purchase of a new prescription. I have even gone so far as to purchase $25 coupons on eBay to be used with new prescriptions.

Since my daughter's ADHD medication can only be filled with a new prescription monthly, I am able to use a coupon every month for a new prescription. If I use a $25 coupon for the prescription for which my copay is $20, then I ostensibly make $5 on the transaction. The next month I can use the $25 gift card from the previous month to pay the $20 copay and get another $25 Gift Card! Turning the $20 copay into my Medical FSA makes this deal even hotter.

I have done this with my wife's prescription as well. Since her medication is available in a generic, it only costs us $10. With a $25 coupon we make $15 each time we fill her new prescription. I am debating on having her ask her doctor for her monthly prescriptions to be written out on separate pages (rather than refills), so that we can take advantage of this.

Purchased a Couple of Discounted Gift Cards

I purchased a couple of gift cards through GiftCards.com over the last two days. One was for Follett, which runs several University bookstores in my area and the other for Burger King.

The Follet gift card was purchased at a 30% discount and the Burger King gift card at a 15% discount, both discounts do not include the 2% back I get on my credit card.

For budgetary purposes, I use the face value of the gift card when I make a purchase using the gift card. In this way, I have more money going into savings without even trying. For example, say my Burger King gift card was a $10 one that I purchased for $8.50. If I were to make a purchase at Burger King for $10, my budget would reflect $10 spent. The extra $1.50 would then flow to my savings account.

Box Tops For Education

Another good way to support schools is through the Box Tops For Education program that are found on most General Mills products and other participating brands.

With coupons I have been able to buy a lot of these products for less than their generic counterparts. And when the cost of products are even, I always go with the one that has a Box Top on it.

Each Box Top is worth 10 cents to the school. From the Box Tops Website:

Earn up to $20,000 each year through the original Box Tops program by
clipping 10¢ Box Tops coupons from hundreds of General Mills products and
partnering brands, like Cheerios®, Betty Crocker®, Hefty®, Juicy Juice®,
Ziploc®, Kleenex® and many more!

If your school does not participate, you can always sell them on Ebay, where they usually go for more than "face value".