Debt, Credit Card & Consolidation Current News Digest

After my last post on drugs, vitamins and expiration dates, I received an anonymous email from someone who claims to work in the pharmaceutical industry. They wanted to share some insider knowledge on how drug and vitamin expiration dates really work. A lot of it confirms and expands on what I wrote initially but includes some first hand knowledge that corroborates what I’ve only found researching online.

So while I can’t confirm he or she works in the pharmaceutical industry, I have no reason to believe (and I think you’ll agree) what he or she says is true.

As a person who works daily with the production of both Liquid and Solid Dose vitamins and all sorts of OTC pain relievers etc, I would almost consider myself an expert on this topic and wanted to give you the low down.

For all of the types of drugs and vitamins we make, the expiration date only holds one meaning: The date that my company will guarantee the legal claim efficacy of the drug. For example, certain vitamins degrade over time, so we put in a safe “overage” – knowing based on statistical stability data, etc, we will know that in X number of months, vitamin Y will degrade by a certain percentage. Our standard formulation process is to work backwards from 24 months and put in the correct amount of each vitamin, (or drug, same principle) so that at 24 months from the date of manufacture, all the nutrition or drug facts on the box are correct – that 24 month date is the expiration date on the box.

The only way for us to put a longer claim on the box is to have actual stability data (not statistical) – for example, if we haven’t changed the formula of the product or the bottle or tube it goes in for 3 years, and we do a bunch of testing on stuff that was made 3 years ago and it still meets the label claims, we can change the expiration date to 3 years. Unfortunately, this rarely happens because someone is always tweaking a formula or changing packaging materials for some reason or another, so its tough to do.

Oh, one other thing in response to a comment left by one of your readers – companies do not want short expiration dates – yeah, it might be nice to have someone have to go back to the store to by more drugs frequently, but there is way more risk for the company. Right now, I am managing roughly $150MM in finished product inventory, and I want as much time as I can to sell it. As it stands today, Walmart and most other retailers won’t accept product with less than 1 year of dating, so anything we can’t sell in that first 12 months after something’s made is usually destroyed.

If product is destroyed, not only is it a huge waste of money, I also have to make new product to replace what I just threw in the garbage – talk about waste.

Editor’s Note: So in summary, drugs and vitamins do work past their expiration date by quite a margin, but drug makers don’t label it as such because they aren’t able to meet the statutory requirements to prove that it does. I thought it was an interesting insider’s look, I hope you did too.

(Photo: SOCIALisBETTER)

Insider’s Look at Drug & Vitamin Expiration Dates from personal finance blog Bargaineering.com.

This post is from GRS staff writer April Dykman.

Social psychologists have found that people tend to choose their significant other based on similarities—similar attitudes, values, and even similar names.

Those findings would seem to suggest that people with similar spending habits would be attracted to each other, too. But a working paper published last year found the opposite to be true. In “Fatal (Fiscal) Attraction,” Rick, Small, and Finkel, professors of the Wharton School of Finance and Northwestern University, found that while most singles say that their ideal mate would have similar spending habits, when it comes to feelings toward spending, opposites attract.

The spendthrift-tightwad spectrum
Rick, Small, and Finkel used a survey to establish where study participants fell on a spendthrift-tightwad spectrum. According to the paper, each of us feel a degree of “pain of paying.” Spendthrifts feel too little pain, causing them to spend more than they ideally would want. Tightwads experience too much pain, causing them to enjoy their money less than they would like. It is important to note that the survey was created so that those on the extreme ends of the spectrum were not simply savers or spenders, but also were the most unhappy with their emotions toward spending.

Opposites attract
If people choose their spouse based on similar attitudes and values, then why would a tightwad fall for a spendthrift, especially if her ideal mate is a tightwad, too?

It turns out that while we look for similar traits in most cases, it depends on whether a person likes or dislikes a trait in themselves. The study found that the more unhappy someone is about their own emotions toward spending, the more attracted that person will be to his or her financial opposite. Deep down, a tightwad might dislike how crazy it makes her to spend $10 to see a movie with her friends, even though she can easily afford it and wants to go. Because she finds it painful to spend and dislikes that about herself, she’s likely to fall for a guy who spends more liberally.

Bad news for marriages
Unfortunately, the attraction to one’s fiscal opposite doesn’t bode well for the marriage. The study found that the degree to which spouses differ in the tightwad-spendthrift spectrum is negatively related with marital bliss. Rick, Small, and Finkel wrote:

Husband/wife differences in emotional reactions toward spending are associated with greater financial conflict in the marriage, which is in turn associated with diminished marital well-being.

And while there’s no scientific proof that money is the root of most divorces, money does create conflict in 84 percent of marriages, according to the findings of a 2007 Money magazine survey.

How to adapt

They strained their chests against enormous weights, and with mad howls rolled them at one another. Then in haste they rolled them back, one party shouting out: “Why do you hoard?” and the other: “Why do you waste?”

Rick, Small, and Finkel start their paper with the above quote from Dante’s Inferno, and the results of the study make a marriage of opposites sound doomed from the start. But marriages of tightwads and spendthrifts can thrive if they can manage to find common ground.

• First, accept that your spouse isn’t likely to make drastic changes. Also, if you were attracted to their relationship with money, even on some subconscious level, you probably don’t want them to do a 180 anyway.
• Find balance. According to the study, one possible explanation for why tightwads and spendthrifts seek their opposites is a desire for balance. They want someone who can help them overcome their emotional reactions toward spending. In other words, a spendthrift may seek out a tightwad because he or she thinks the tightwad might help reign in the splurges. Before you wish your spouse saved more or could loosen the purse straps, consider whether their habits have changed your emotions toward spending for the better.
• Stay on the same side. It’s easy to see someone with opposing views as your adversary, but you’ll be more productive if you approach your situation as a team. I want to spend thousands on a luxury vacation, you want to spend a few hundred to stay at a nearby B&B. Is there a solution that would make both of us happy? Find common goals and work from there.

My own experience has been that differing traits can be a positive thing. While neither my husband nor I spend excessively or save compulsively, he is much more easy-going in general, whereas I fretted for months over buying a computer I needed for my freelance work. (I couldn’t actually complete the online order for my laptop until he was sitting next to me. I need moral support for big-ticket items.) I appreciate the way his influence has helped me lighten up, yet it was my geeky love of spreadsheets and math that helped us develop a concrete plan to pay off our debt and build up our savings. Differences can help you grow as a person.

Are any of you a spendthrift in a relationship with a tightwad, or vice versa? How do you successfully deal with your different approaches to money?

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Related Articles at Get Rich Slowly:

• Spare Change #3
• Weekend Update: PF101 Edition
• Is There a Generation Gap in Saving?
• Ten Steps to Greater Happiness
• Secrets of the Extremely Thrifty

Arianna Huffington made waves recently when she went on national television calling on  consumers to dump their big banks and deposit all their money into local, community banks.  Huffington's site, HuffingtonPost.com, threw its weight behind a Web site designed to make breaking up with your bank a little easier — MoveYourMoney.info. It includes a ZIP-code based locator to help consumers pick through the thousands of banks in the U.S. It even sports a short, cleverly edited video that juxtaposes the classic film “It's a Wonderful Life” with images from testy congressional hearings about the banking industry.

Driven largely by Huffington's media popularity, the site quickly gained traction. Huffington's appearances on MSNBC's Countdown and CNN's Larry King Live, among many others, had some observers calling MoveYourMoney a movement. One of Huffington's partners in the venture, Dennis Santiago of Institutional Risk Analytics, says visitors have searched for banks in more than 16,000 ZIP codes — better than half the ZIP codes in the country. 

It's far too early to tell if Huffington has done something that might genuinely take a bite out big banks — real data probably won't be available for months.   But Huffington is tapping into frustration that has been building since 2008 banking collapse and bailout, say advocates for credit unions and smaller, community banks.

"It has been developing for the last several months," said Bill Hampel, chief economist of the Credit Union National Association. "Annual growth in credit union members had been very weak for the past several years…but during the first 11 months of 2009, our growth rate doubled." Credit unions added 2 million new consumers  during that stretch, Hampel said.

Karen Tyson, spokeswoman for the Independent Community Bankers Association, said her 5,000 member banks were experiencing similar, frustration-driven growth.

"Community banks have, since the onset of the financial crisis, gained new customers," she said.   

The American banking system appears to provide seemingly endless alternatives.There are 8,000 banks and 7,600 federally insured credit unions, according to the American Bankers Association.

"The good news is people have choice," said Nessa Feddis, spokeswoman for the American Bankers Association.  "There's lots of competition, and if people are dissatisfied they should look around and vote with their feet."

But most don't.  A tiny group of large banks dominate.  In 2009, four banks — Citigroup, JPMorgan Chase, Bank of America and Wells Fargo — held 39 percent of all deposits in FDIC-insured banks, according to Reuters. 

The high concentration of account-holders — combined with a low concentration of good will – certainly seems create the potential for a mass exodus. So why the need for a Huffington Post-prompted movement?

It turns out the breaking up with your bank is hard to do. 

In 2008, the Federal Reserve published a study around what economists call "switching costs" — the pain and suffering consumers must face when trying to leave one bank to join another.  The results were disturbing.  The study, by Fed senior economist Timothy Hannan, found it was incredibly difficult for consumers to get reliable information about the true costs of the new bank, for example, and described what a "bargains-then-rip-off" strategy to reel in customers and then exploit them. 

The euphemistic  name for the strategy is a “two-period” model. )  Period one is a free toaster.  Period two is cascading overdraft fees.

Even worse, the true costs and fees levied on account holders may not even be available to consumers until they've committed to the new bank. In many cases, fee schedules aren’t listed on generic Web sites and  can only be viewed by account holders after they’ve logged in – so there is literally no way to comparison shop.

“There may be some lack of transparency with regard to pricing,"acknowledged American Bankers Association chief economist Keith Leggett.

The switching costs become apparent when trying to extract your old bank's tentacles from your new financial life.  Today, most consumers use their checking account for a dozen different activities — direct deposit of payroll checks, automated online bill payment of mortgages and auto loans, recurring debit card transactions, automatic savings plan deductions, credit card bill payment and so on.  Ending all these transactions, and starting the payments anew, is such a hassle that "inertia" often takes over, says Hampel.

"Changing where you have your checking account can be a royal pain in the neck," he said. "It's like if you lose a credit card and have to inform all those people you have a new one, only much worse than that."

To combat the switching cost problem, many credit unions have developed "switch kits" to grease the skids, including forms that help new consumers track the changes needed for all payments and deposits. Those may ease the pain a little, but ultimately getting a new bank means fighting through a lot of red tape.

Still, consumers should look past the hassle and find a bank or lending institution that suits their needs, says Leggett.

"Who you do banking with is very important.  It may be the most important financial relationship of your life, so you should do your homework," he said. 

Leggett welcomed the discussion about switching to smaller banks and credit unions started by the Huffington Post, but he cautioned consumers against a "knee-jerk" reaction to it.

"In not every case is a credit union better than a bank with regard to pricing or fee structure," he said, saying that credit unions have also been guilty of charging annoying fees, just like big banks. "People have to realize when looking for a financial provider that they should always shop around and find a provider who offers the appropriate level of convenience.

Smaller banks and credit unions, he warned, will not provide the same "product mix" as larger banks, and are less likely to offer benefits for using multiple products – such as free checks or discounted loans.

But credit unions provide obvious benefits – in the form of better interest rates, both on loans and deposits, said Hampel.  According to Datatrac Corp., average credit union credit card rates are currently more than one full interest point lower, car loans are 1.5 percent lower, and one–year CD rates are 0.30 percent higher.  (Banks currently enjoy a small edge over credit unions in mortgage rates.)

Meanwhile, community banks offer something big banks find nearly impossible to compete with — local ownership and the ability to talk with a familiar face in the event of unexpected financial hardship, said Tyson of the community bankers group.

“They always put customer service first, and doing right by the community first.  They will not give you a

loan purely to make a profit. And you’re not going to be just a number,” she said. “You’ll be able to walk in the door and you can find the bank president, and know that he lives in your community. … It's a different sort of a custoimer relationship.”

Like Huffington, Tyson sees the switching issue in a larger context.  Federal law provides for a nationwide "concentration cap" of 10 percent, meaning no one bank can control more than 10 percent of the U.S. deposit market. 

Because of the banking collapse and resulting consolidation – leaving four banks with nearly 40 percent of deposits —  the cap is currently being threatened, leaving the U.S. financial system concentrated in too few hands, Tyson said. Through its "Fix Too Big to Fail" marketing campaign, the community bankers group  is lobbying Congress to lower the cap and force large banks to divest some of their holdings.

"The only way to change the dynamic is to have legislation in place that makes it not as appealing to be … large institutions," she said.

RED TAPE WRESTLING TIPS
Marketing campaign and blog-initiated movement aside, it’s always a good idea to review your financial relationships and see if you can get a better deal.  Consumers interested in investigating a move away from big banks should know it takes a bit of work, but there’s plenty of help available online, and one or two lunch hours should do the trick. Here are some tips:

* Rates aren't everything, and people matter. Leggett points out that many consumers are far too concerned with the published interest rate they'll earn on savings and checking accounts, and sometimes pick banks based on small differences.  Given that current rates are so low, earned interest should be of little concern at the moment; fee schedules are more significant. But even more important is the likelihood that the bank will treat you like a human being should anything go wrong; if, for example, you accidentally overdraw your account and land a series of overdraft fees.  Will a familiar teller help you, or will you end up stuck on a long voice mail tree?  We all make mistakes. It’s hard to put a price tag on the reassurance that you’ll be treated like a person, and not a criminal, when your turn comes.

* Don't forget the middle child. Feddis points out that there is middle ground between the four huge banks and thousands of small banks — what she calls "medium-sized" institutions.  They might offer the best of both worlds.

* Beat the feared late fee:  The real fear over switching comes from the potential for a missed loan or credit card payment, or double payments that could lead to an overdraft. There are several ways to ease the transition between institutions, although all of them involve a little extra money.

The easiest thing to do is double up. Keep both accounts open and keep all your payments turned on until you can confirm that new payments have been received by the old payee.  This will require having a lot of extra money to spare. A variation involves paying with your new account a full 10 days earlier, giving you time to cancel scheduled payments from your old account. You'll still need the extra money in case a payment lands in limbo. In either case, it's good to set up overdraft protection on both accounts by linking the checking account to a credit card, savings account or line of credit, so there's backup if you screw up.

The simplest – but most time-consuming — method is to open the new account without closing the old one, and then switching one bill payment one month at a time to the new account, making sure each one is set up properly before switching the next one.

*If your credit card issuer has cut you off: Many consumers find they are losing available credit on their cards or losing their cards altogether.  This hurts their credit score.  Hampel said consumers thus spurned should still apply to a credit union for a new card and will likely get the account as long as their credit isn't severely damaged. Expect a lower credit limit than you're used to, however — credit unions are much more stingy about credit card maximums.  That's a good thing, Leggett says:  that's partly why the bank credit credit card default rate  is currently around 10 percent, while credit union rates are down near 2.5 percent.

*Finding an alternative. While credit unions have certain limitations on membership, Leggett says that virtually all U.S. adults are eligible to join at least a few credit unions.  If you're stumped, try the credit union locator at

http://icba.org/consumer/BankLocator.cfm?sn.ItemNumber=51757

To find a small bank, try the bank locator

http://icba.org/consumer/BankLocator.cfm?sn.ItemNumber=51757

or use the Huffington Post tool, which lists only banks graded B or higher on Institutional Risk Analytics’  scale.

——————-

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Well it’s time to announce who won the 2 free software downloads from YNAB. This free personal finance software giveaway yielded some interesting feedback for the creators of YNAB. Here was one that caught my eye — from Scott, who downloaded the free trial:

I downloaded the trial and like what I see so far. I used to shoehorn the envelope method into MS Money. MS Money worked but required a lot more effort than it needed too (really a pain). YNAB appears to do the same thing I was doing but in a much easier way. Really like what I see so far. But I do have a usability concern regarding their reconciling feature. It automatically marks each transaction I download as “r” even if it duplicated something I already had in there or even already downloaded. That can be a really big problem when making sure you have the same balance as the bank. I assume from other people that rave about it that this problem does not make the software unusable. It certainly seems like a small price to pay for all the program’s other great features. I do wish the trial was longer than 7 days so I could try a “reconcile” or two before buying.

It would certainly be nice if the trial was available for a longer period!

Now on to the giveaway results! The winners of the YNAB software this time around are…. Scott and Christene. I’ll be contacting you with details on how to receive your copies. If anyone’s interested in a 15% discount off the regular price, you can get still get it using this YNAB discount coupon code.

I will have more giveaways of this software in the future, for sure!

Free HDTV Giveaway To One Reader

Recently, I’ve been in the habit of watching out for interesting giveaways to share with you here. Well, if you’d like to be in the running for a lovely 40″ HDTV, then you can check out this giveaway. You can enter for free (instructions are in the page) but you can increase your chances by purchasing a copy of the book Life or Debt 2010, by Stacy Johnson, who also runs the site Money Talks News.

Announcements

Thanks to The Consumerist for mentioning my post on gourmet coffee recipes!

On another note, I wish I had mentioned this in time so I could bribe you for a few votes . But apparently, I got clobbered in the Free Money Finance March Madness blog tournament for my entry on 55 Best Ways To Save Money. I read my opponent’s piece on 11 Dumb Ways To Get In Debt, and you know what? It was awesome and see why it’s a winner. So I guess I’m out of the running this time — a little earlier than I would have liked, but them’s the breaks!

Now for our weekly roundup!

Personal Finance Articles

• Brip Blap: Is Life Fair?
• Taking Charge: Effect of Massachusetts Senate Upset On Financial Reform
• Frugal Dad: Saving With Purpose: Short Term Goals
• Gen X Finance: Introducing Bundle, For Money Management
• Political Calculations: An Unexpected Source of Increasing Income Inequality
• Monevator: Bank of England’s King Blames Frugal Foreigners for the Credit Crisis
• The Sun’s Financial Diary: Where and How to Stash a Stockpile
• Money Smart Life: Lost Credit Card Q&A
• Funny About Money: Carnival of Money Stories
• Million Dollar Journey: Carnival of Personal Finance – Support Haiti Edition
• Cooking Manager: Festival of Frugality

Life or Debt 2010, Free HDTV Giveaway, Winners of Free Software

This guest post from Caitlin of ClutterCubed (a blog about ridding clutter from your life) is part of a new feature here at Get Rich Slowly. Every Sunday will include a reader story (in the new “reader stories” category). Some will be general “how I did X” stories, and others will be examples of how a GRS reader achieved financial success.

Back in September, one hour of my time cut 16 years off my mortgage! It was one of the easiest things I’ve ever done, but I can honestly (and sadly!) say I probably wouldn’t have done it if it weren’t for Get Rich Slowly.

However, this is less of a tale of ringing triumph, and more of a story that shows how financially clueless I was, while you all point and laugh how even people who make financial missteps can put themselves back on the right track.

My shiny new mortgage
In mid-2008, my husband and I bought a shiny new house and acquired a shiny new 40-year mortgage. That’s right: a 40-year mortgage. It’s embarrassing to admit now, but the banks we talked to assured us that 40 years was “the new normal” for first-time home buyers like ourselves.

This was, of course, right before the crash and the economic downturn, so at the time our 5.5% mortgage rate looked pretty spiffy. As first-time buyers, we could have gotten away with a 0% down payment, but over the years we’d saved enough for a 7% down payment (thanks in part to a small inheritance my husband received). We felt smart. We felt like we were doing the right thing, like we were ahead of the game.

Unfortunately, as we later learned, there’s a big difference between feeling like you’re ahead, and actually being ahead. We didn’t know about the trick of planning mortgage payments before you have to start making them, so we hadn’t been putting away “a mortgage payment” every month prior to moving in. We also had no emergency fund to speak of.

By the numbers
We had, at least, planned our housing costs so that they wouldn’t be more than 28% of our gross income. I don’t remember where we got that number, since at the time we did not really read any personal finance books or blogs. I think we just pulled 30% out of Google, as a financial rule of thumb, and then aimed for a bit less than that.

Because of little things like that, we thought we were doing great, but looking back there are a lot of things I wish we had done differently. (I wish I’d started learning about personal finance before buying a house, for one thing!)

Properly taxes were included in our mortgage payments, and they’d been over-estimated to avoid needing to make a big payment once our house was reassessed this year (since the last time it had been assessed was in 2007, when it was still a dirt lot).

This September our mortgage payment came out automatically as usual, but we were really worried when $180 less than normal was taken from the account. I panicked and called the bank, thinking it was perhaps a mistake, and there would somehow be consequences for not making a full payment. The bank assured me everything was okay, and it was just that our property taxes had gone down after a reassessment, so our payment had been adjusted.

A profitable hour
The Old Me would have celebrated having an “extra” $180/month to spend. The New Me, the one that reads Get Rich Slowly and other personal finance blogs and books and is actively trying to improve my financial situation, immediately booked an appointment with the bank. My husband and I agreed that, since we’d been paying our mortgage all year without any problems, we should keep paying the same amount.

At the appointment, we not only bumped our payment back up to what it had been (paying an additional $180 on every payment, or an additional $2160/year), we also switched to a biweekly payment plan, with payments equal to half our monthly payment, so that we would be making an additional full payment (plus an additional $180 on that payment) every year.

In that one hour appointment, we watched our projected mortgage end date shrink down to 23 years. One hour of our time saved us 16 years of payments and interest.

It still boggles my mind.

All it cost us was an hour of our time. Well, an hour of our time and $45 for a one-time payment to make the switch possible. I’m not too thrilled about the $45, but I’m not upset about it, either.

Action beats inaction
I’ve read it dozens of times on PF blogs: overpay your mortgage, make an extra payment each year. Blah, blah, blah. Even seeing the occasional calculated example didn’t really drive it home for me. It always felt like I couldn’t be like “those people” — the ones with enough extra money to do fancy things like prepay a mortgage. I was afraid of screwing up, of doing it wrong. However, like J.D. says, action beats inaction, and in this case, he’s 100% correct!

I say thank you, J.D., for having this blog and inspiring me to get off my butt about my personal finances. Without you, I might not have had the drive to make that appointment with the bank that saved me 16 years. Without your blog and your readers, I may have known intellectually what I should have done, but it would probably have seemed out of reach.

I might have been content with my “found” $180/month. I might have handled it responsibly, and used it to pay off debt at least, but I know I wouldn’t have switched to biweekly payments. It seemed like such a hassle. It seemed like such a pain to set up. It felt like it couldn’t possibly be worth my time and energy to shuffle around my schedule, get my husband home from work early and go talk to the bank. Even though I “knew” it was worth it, I didn’t actually believe it until it happened. It was worth it! I had such an amazing feeling as I left the bank!

Have you had such a big payoff from investing a little bit of your time? Can you beat knocking 16 years off the mortgage in one measly little hour? Let us know in the comments!

Reminder: This is a story from one of your fellow readers. Please be nice. After nearly a decade of blogging, I have a thick skin, but it can be scary to put your story out in public for the first time. Remember that this guest author isn’t a professional writer, and is just learning about money like you are.

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Related Articles at Get Rich Slowly:

• Mission Accomplished: Our Shiny New Mortgage
• The Seller’s Gift: How To Buy a Home With No Down Payment
• Reader Story: Necessity is the Mother of Frugality
• Daily Roundup: Interviews, Charities, and Bike Mortgages
• Daily Links: Pets, Films, and Mortgage Savings

As the New Year kicks off to a start many of us are taking the opportunity to take stock, examine and make changes. For many this can be somewhat of a painful process. Even though change is truly a part of our lives on a daily basis and on a larger scale, there is still that stigma of change being associated with pain.

This year as we ride out this strained economy the theme for many people is “look at what I already have!”. This can apply to appreciating the family & friends in our lives as well shopping and acquiring more stuff. Here are a few ways that you can kick the Eco-simplicity habit into gear and set the mood for 2010 and beyond. And don’t forget, changes don’t have to be painful. They can bring joy as well as inspire you and those around you.

Go With What You Already Have

Each day brings us new opportunities for change, but there is just something about changing of the year that inspires thoughts of bigger changes and new beginnings. As you look around at the latest trends, gadgets and stuff that bombards our daily life, try shifting your approach just a bit.

• Take stock of what is in your closet, drawers and garage.
• In the realm of fashion, think about adding a few new accessories like scarves, belts and shoes instead of a whole new wardrobe.
• Go shopping in your own closet, what have you forgotten about?

Discover The Joy Of Consigning

When I became a parent, I quickly realized the need for new stuff every few months. From clothing to shoes and toys, there always seems to be a need for the next size up. For adults, even though there is no need for a size up (well sometimes) we still have that ad man telling us that we need better, bigger, newer each year or so. If you do opt for the better and newer (because I know we are all human), there is a better way.

• Find the nearest consignment shop in your area.
• Take anything (as long as it is clean) that you haven’t worn used in the past 2 years (or more)
• Bring it in for credit or cash towards your next purchase.
• p.s. Kids LOVE getting in on this idea. Plus it’s great habit to teach them – “stuff must go out before new stuff comes in”.
• This also helps to avoid dreaded clutter.
• Consignment tip: I like going to consignment stores in upscale areas, you won’t BELIEVE what some people get rid of and the amazing deals you can find on high quality items.

Don’t Shop Trends

Yes, we would all look amazing in the latest fashion trends. The problem with trends, is that there are new ones every 2 seconds. You spend $20 on that cute top at Target only to have it go out of style the next day. I’m not knocking Target at all!! I think there are many wonderful deals there that I have taken advantage of during the years. But I’ve also learned my lesson. I can but ten $20 shirts over the year that may or may not last. OR I can buy less, but better quality classically designed pieces that will last for years (until it is their time to go to consignment).

• Figure out what is flattering for you (this goes for women AND men).
• You can take advantage of free personal shoppers at most department stores to guide you through a trip and find out what works for you.
• Ask a stylish friend whose eye-for-fashion you admire to help you pick out a few key pieces.

Set Up A Friendly Swap

This is one of my favorite things to do. If you are not keen on consignment shopping, set up a friendly clothing and home goods swap. Invite a group of friends to bring clean, gently used or no longer used clothing and home accessories…you can even trade art and craft supplies; this is such a wonderful way to connect with friends while exchanging things you don’t use for things you will. This is amazing for a group of friends with kids of varying ages. We all know how quickly we go through children’s clothing and shoes.

What are your Eco-inspired changes for 2010? I’d love to hear from you.

(Photo: barl0w)

4 Eco-Tips For A Wonderful New Year from personal finance blog Bargaineering.com.

This is a guest post from Richard Barrington, a freelance writer and novelist who spent over 20 years as an investment industry executive.

There’s nothing like the holidays to make you think of cold weather — and your spending. If your wallet is as leaky as your windows, there’s a way to kill two birds with one stone. Making your home more energy efficient can pay for itself over time in the form of lower energy bills. And federal energy-efficiency tax credits, available until 31 December 2010, can significantly shorten the time it takes for these improvements to pay for themselves.

Smart financial moves are often talked about in terms of sacrifices: how a little short-term pain can lead to long-term gains. What’s refreshing about energy-efficiency tax credits is that they are a smart financial move that will actually make you feel more comfortable in the short term. Energy efficiency improvements can make your home warmer in the winter and cooler in the summer. (They can even make you feel a warm glow about yourself when you realize you’ve reduced your carbon footprint!)

Energy-efficiency tax credits: Eligible projects
Many of the available tax credits award you 30% of the cost of certain energy-efficient home improvements made to your primary residence between now and 31 December 2010. What are examples of eligible improvements?

• Installation of biomass stoves
• Improvements to heating, ventilating, and air conditioning systems
• Addition or replacement of insulation
• Replacement of metal and asphalt roofs
• Installation of non-solar water heaters
• Replacement windows and doors
• Geothermal heat pumps
• Residential wind turbines
• Solar energy systems
• Residential fuel cells

Different projects have different limitations on the total amount of the tax credit you can apply for, and expiration dates vary. You’ll have to go to the Energy Star website, jointly run by the US Environmental Protection Agency and the Department of Energy, for details on what counts for a tax credit.

Financial rewards of energy efficiency
The federal tax credit reduces your immediate, upfront costs from the qualified energy efficiency improvements. How much can reduced energy bills further offset your costs? Let’s look at an example of replacement windows and doors.

If you are upgrading from single-pane windows and doors, energy-efficient replacement windows and doors can save a typical homeowner between $126 and $465 per year. (Why the big spread in savings? Local utility rates and climate vary a lot, as do the size of homes and the surface area of windows and doors.)

You might think it’s the chilly northern climates that could benefit the most from replacement windows and doors, but actually the southern Atlantic region — from Maryland to Georgia — is where homeowners are estimated to save the most from this upgrade. That’s because this region can experience both sub-freezing winter conditions and extreme heat in the summer.

This is just one example of a project that offers both an immediate financial benefit — through the tax credit — and ongoing utility savings. Imagine what your monthly utility bills could look like if you did several of the projects.

The Bottom Line
As always with tax issues, you may want to check with your tax advisor to make sure you can benefit. For most people, though, these energy efficiency tax credits are a tremendous gift from the federal government — they’re basically paying you to do something that can make your home more comfortable, allow you to feel better about your carbon footprint, and save you money over time.

If you’ve been wondering where your government bailout is, you can claim it in the form of an energy efficiency tax credit.

Barrington is a regular contributor at MoneyRates. Previously at GRS, he shared how to find the right CD or money-market account and tips for sound saving and investing.

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Related Articles at Get Rich Slowly:

• Energy Star: Saving Money Through Energy Efficiency
• Free Web-Based Home Energy Analyzer
• Save Money by Switching to Compact Fluorescents
• Another Frightening Show About the Economy
• Daily Links: Personal Bailout Edition

Christmas is a time for letting loose, isn’t it? It is for fun and fellowship with family and loved ones, for enjoying a few late nights out and devil-may-care food indulgences. It’s for letting your rigid work and exercise schedule slip away without even the idea of beating yourself up about it. Fair enough too. If we can’t relax at Christmas time (shopping and family arguments aside!), then when can we?

Of course there’s always the possibility of too much of a good thing, which is why I’ve put this handy list together for you. Follow this advice and you’ll definitely gain weight and feel awful by New Year’s. Or you could just do the opposite and enter the new year with a smug and energized bounce!

1. Drink alcohol most nights – even if you’re not at a Christmas party or out with friends.
   After all, it’s only a glass or two, surely that can’t won’t hurt. Go on – everyone’s having one. Besides, wine’s good for you. And white spirits really don’t count at all! I mean, really – whoever heard of December without a nightly tipple. Ridiculous idea. Make sure you enjoy some bar snacks while you’re at it.
2. Put a complete pause on your exercise program.
   In fact, why not wait until you feel really settled at work in 2010 to worry about getting back into it. After all, the Christmas break is never long enough, and it only comes around once a year. You deserve to let all your hard work go. And really, it would be too much of a shock to the system to try and workout on the back of all those hangovers. It makes much more sense to ease the pain with a nice comforting lunch out. Don’t forget to have a glass of wine with that pasta.
3. Indulge in lots of teeny-tiny-surely-they-don’t-count treats.
   Especially the sugary ones like candy canes, mini chocolates, and anything else that’s being passed around the office or the staff party. It’s probably only a myth that sugar makes you put on weight. Definitely. Almost certainly. Maybe.
4. Use the festive feel as an excuse to stay up half the night even if you’re not going out, and then simply get through the next day on caffeine.
   I mean, caffeine gives you a kick-start, so it must speed up your metabolism, right? Besides, staying up late and drinking lots of coffee makes it easier to skip meals. I’m sure that’s got nothing to do with your body being out of rhythm, causing elevated stress hormones, allowing you to store more fat and therefore not be as hungry. That sounds made-up, doesn’t it?
5. If you’ve finished your shopping and are sick and tired of get-togethers, sit around on your butt.
   Surf the net, send tweets, or watch TV, no matter - just don’t move. There’s no point trying to be productive at this time of year anyway, and besides, the constantly unchanging weather is making you feel bored. And hungry. And lazy. While you’re sitting there, may as well have a snack. Or two.

Sounds like a plan, doesn’t it? Or perhaps you have an altogether different approach. What do you do to enjoy the holiday season and still leave December with your health intact?

Readers of my previous articles will know that I try to live as effortlessly as possible. This all started (in a conscious way, at least) when many years ago, as a teenager, I discovered the ancient Chinese idea of Wu Wei - ‘action without action’ or ‘non doing.’ The discovery came quite by accident - as most good things in life tend to happen.

I was on holiday with some friends and one day I went for a walk alone. I came across an old, second hand book shop, and as I glanced over the disordered titles, I came across a translation of the Tao Te Ching, by R. L. Wing called ‘The Tao of Power.’ The front cover described it as ‘Lao Tzu’s classic guide to leadership, influence and excellence.’ I bought the book - who knows why, - and have it on my table as I write these words. It has been a beloved companion throughout all the years since that day.

“Follow your bliss, and doors will open for you that you never knew existed. Follow your bliss and the universe will open doors for you where there were only walls.” - Joseph Campbell

When you’re doing things the right way, when you’re going with the flow - when you’re doing things the ‘wu wei’ - way, then you are effortlessly abundant. This, of course, is why I chose the name ‘Effortless Abundance’ for my website. You should be happy, healthy, fulfilled and abundant in every way. And this abundance should be effortless. Effortless abundance can be applied to every area of life, but here I want to share how I have come to apply it to ‘being fit.’

People put themselves through all sorts of pain to ‘get fit.’ I got into the habit of going to the gym several times a week. I’m sure it did me some good - my resting heart rate is pretty low, I am slim and agile, I sleep pretty well, and I never get out of breath (giving up my ‘social smoking’ will have helped, too!) But there was a downside, too - I guess my knees haven’t appreciated all that running on the treadmill and all that cycling!

But the main downside, the thing that really bothered me, what just how much effort it all was. To be honest, I never enjoyed going to the gym - it was always a chore. Getting changed, having to compete for the ‘machines,’ feeling physically uncomfortable (heart pounding, muscles straining), taking a shower, getting changed again. What a hassle! And how was I fitting this into my schedule? I did make time, but I often had to leave work a bit early or give up part of my weekend. And just the thought of having to do it - that black cloud constantly hanging over me.

Now, I’m not knocking the gym. As I said, I’m sure it did me some good, and I know people (not many, but some) who love the gym and look forward to it. If you’re like this, then great! And here is where I (finally) get to the point I am trying to make.

Whatever you’re doing - whether it’s your work, your hobbies, being with your family, and even exercise - it should make you feel good. It should be enjoyable. If it’s enjoyable, then it’s effortless - it’s action without action; it’s Wu Wei.

Maybe I just don’t like exercise. But when I look back over my life, it seems strikingly obvious that this isn’t true. I never liked sport or competitive games, and I never considered myself - nor was I ever considered by anyone else - as a ‘sporty’ kind of person. But I have always loved walking. Walking is a form of exercise - in fact, it’s one of the best forms of exercise that you can possibly do. In 1997, Professor J Morris and Dr. Adrianne Hardmann called walking ‘the nearest activity to perfect exercise.’ Why? Consider the following health benefits of regular walking:

· Reduced risk of coronary heart disease
· Reduced risk of stroke
· Lower blood pressure, lower cholesterol and better blood lipid profile
· Reduced body fat
· Increased bone density, helping to prevent osteoporosis
· Reduced risk of cancer of the colon and breast
· Reduced risk of non-insulin dependent diabetes
· Controls body weight
· Reduced chance of getting gallstones
· Helps flexibility and coordination hence reducing the risk of falls
· Better self esteem
· Lower levels of anxiety and depression
· Enhanced mental well being
· Longer life expectancy
· Better range of movement, hence less chance of injury during a fall
· More flexible muscles
· Better sleep

Need I go on?

When I was younger, I used to go for long walks regularly, not for the health benefits but because I enjoyed it. I loved being alone, being able to think, being out in the fresh air, close to nature. I think walking was one of my favorite activities - it was truly effortless for me. This ‘inner compass’ of our feelings is so vital, isn’t it?

I’m not suggesting that walking is for everyone, but I am sure that when you’re doing what you love, you’re doing the right thing.

With the end of the year rapidly approaching, chances are you still have a few dollars left in your Flexible Spending Account (FSA), if you have one. The old backup solution is to stock up on over the counter supplies but that might not be the most effective use of your FSA dollars. OTC products are great as a backup, but there are a few things you should try to do before just buying a million bottles of Advil.

This post is part of the Bargaineering Annual Financial Review week series where we take a closer look at the four major facets of personal finance and see if we can do better. This post is part of day four – beating back the tax man.

Visit the Doctor, Dentist

Last year, I wrote my last minute FSA ideas post three days before the end of the year, which was cutting it way too close (it was accurate though, certainly last minute!). Since it’s early December, I recommend that you try to spend it on a visit to the doctor for a regular check-up or the dentist for a cleaning.

I used to hate visiting the dentist and getting my teeth cleaned. Very few things are worse than lying back helplessly as someone scrapes your teeth with sharp metal picks, ugh. But I made two changes that made the process so much better – I began flossing regularly and I went to six-month cleanings. By going more often and flossing, the process was faster and much shorter.

Chiropractor

Chiropractor visits, if they are medically necessary, are FSA eligible, so make an appointment if this applies to you. I had never been to a chiropractor before I was adjusted in September, and it was awesome, but easily a dozen people have told me that visiting one helped them immeasurably. Many of them had been in minor car accidents that threw their back or neck out of alignment and a few visits to the chiropractor beat months of taking pain medication and using other remedies. A good place to look for a chiropractor near you is the Planet Chiropractic practitioner directory.

Contact Lenses, Eyeglasses

If you wear contacts, you could always buy an extra box or two with your extra FSA money. The downside to buying it a la carte like this is that most manufacturers will give you a rebate if you buy a year’s supply of contacts, so you’ll be paying more per box this way. That being said, you know how often you go through contact lenses so they won’t just sit in your closet for months.

Over the Counter

When all else fails, you can always stock up on OTC drugs and other medical supplies. I usually buy all my stuff from Drugstore.com because they have an “FSA store” and label FSA eligible products with a blue and white check mark. While most OTC drugs are included, I find it easier to look there and see on a page what’s eligible, rather than checking a list. That being said, here’s the list:

• Contact lens solution
• First aid kits
• Band-aids, blister band-aids
• Motion/sea/car sickness pills
• Pain relief – Advil, Tylenol, Bayer, etc.
• Electric heating pads
• Thermometers
• Allergy medicine – Loratadine is always good to have, it’s the antihistamine in Claritin, at a fraction of the price.
• Healing lotions
• Acid reflux, Acid reducer drugs
• Smoking cessation products
• Braces, supports, ACE bandages
• Ice packs – for those sprained ankles
• Blood pressure monitor
• Defibrillator

How do you spend down your last few FSA dollars?

(Photo: clevercupcakes)

How to Spend Down Your FSA from personal finance blog Bargaineering.com.

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