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August 19, 2011, at 6:00 am If you're new to BFS, please subscribe to my RSS feed. It shows me a vote of support and keeps me motivated to keep your attention. If you have any questions or comments for me, please contact me and I'll get back to you asap. Thanks for visiting! One of our favorite tv shows is “Royal Pains”. It is about a concierge doctor doing what he does best in the Hamptons since he was fired from his emergency room position in the first episode. It’s actually a feel good show, which I appreciate. As you can guess, there are a billion lessons to learn from the stuff you see in the fake Hamptons, but the most recent subplot is what caught my attention.
The TV Problem
One of the main characters, Divya, is Doctor Hank’s physician assistant. She was arranged to be married to a long-time family friend, but she pulled out at the last minute at the end of last season. Since she has refused to be in another arranged marriage, her very wealthy family cut her off for the first time ever. At first, I was worried the writer’s were going to make this very intelligent character a complete financial bimbo, but she catches on that she needs to be frugal right off the bat. The big kink is that her ex-inlaws-to-be have demanded that she repay them for all the money they had spent on the wedding and stupid fru-fru events and plane tickets. So she gets a second job to pay them back.
Lessons to be Learned
First of all, I thought the writers captured the character perfectly. She is written as a smart woman with a HUGE dose of responsibility and dependability. I thought that deciding to pay back the ex’s parents would be right up her alley. But I started to wonder if she should even be responsible for all the silly charges that were completely up to their whims.
In the real world, if I had cancelled my wedding at the last minute, I would feel like I would have needed to send back the gifts, return my husband’s family ring, and pay back all the charges my ex’s family had incurred like the reception decorations and honeymoon. But I wouldn’t think I should have to pay for whatever crazy private dinner they were going to throw for the family the following day. That would be on them.
In short, I’d have a line.
How Common Are Wedding Cancellations?
All of this said, I’m going off on another rabbit trail. What is with all of the last minute wedding cancellations on tv and in movies? I do not understand. Most weddings take months to plan and hopefully the couple has been together long enough to know if forever is right for them. Was I the only bride never to even think about cancelling? It wasn’t “if” we were getting married – it was just a matter of “when”. We aren’t perfect and there are days that I think “damn it”, but if I wasn’t sure about marrying my guy, I sure as hell wouldn’t have put in all the work to plan a big event. I hate party planning. It was a hassle. We ended up having a great wedding, but I wouldn’t even have called the university chapel if I wasn’t 100% sure I’d be using it.
What do you think? Should Divya be on the hook for all of the splurges? Our last minute wedding cancellations that common?
August 18, 2011, at 6:00 am
The following is a guest post from my mom. She actually wrote it to help me out when she saw that I was thinking about hiring a staff writer. I think she rather only read stuff from me, lol.  She wrote it originally in my point of view, like a ghost post, but I changed it to hers and added headers and stuff like I do with all guest posts. I thought you all would love seeing a post from my mom, so let her know what you think in the comments!
My husband and I have retired a bit earlier than planned. So we are really into saving money on our monthly bills.
Now you may need to understand something about us. Saving is something we have always done. Crystal is the product of that environment. (Yeppers). Paying off interest bearing debt when that interest is more than what you can get on a savings account and buying the most inexpensive products with the best value have always been our cornerstone beliefs.
Our Cable and Internet Choices of the Past
Until five or six years ago, I would not allow us to get cable. It did not make sense to me to pay for something you could get for free. Television was not a necessary item, it was a time consuming luxury that took away from homework time and family time. Due to various life changing events, I did become dependent on the internet though.
Up until 2000, I used various dial-up services. Then the neighbor accidentally cut the telephone line again while gardening, and the phone line was never fixed properly. After a year of complaints and watching the telephone bill increase every month with even more added fees, I gave up. I bought a couple of prepaid cell phones after trying a cell phone contract, which also ended badly (a story for another blog topic); and ended up using a pre paid cell phone that actually worked in the middle of nowhere (also known as my parents’ place). Trouble is you could not get the internet over a prepaid phone at the time, so I went to the local cable company and asked about getting broadband service.
Our First Steps into Cable
They had just started offering broadband, so they gave me a huge discount if I would sign up for a bundled cable-broadband deal. So I signed up, went home and arranged our computers as we wanted them, and had the installation put in without a hitch. I was a very happy camper. Since multiple birthdays and an anniversary was coming up, and my eyes had been getting tired of watching our grainy television, I also began the hunt for the best television for the least price. I used our new broadband.
Well, Amazon had this fantastic deal on a large Panasonic Plasma, but this New York photo site had an even better price on it with a better shipper and great guarantees. So I took the plunge and bought a plasma TV and a huge scissor mount to hold it. I surprised Crystal’s father with the news. He would have this fantastic cable package and a plasma TV. He was deliriously happy. After much sweat, the plasma tv was installed and still works to this day. The cable worked great and my husband even sneaked out and upped the service package to include HD the minute it was available. That was like 4-8 years ago.
Retirement
Now we are retired and are making less than one third what we were making then. Now we have a daughter in college and another one working towards graduating high school. Now the cable company allows you to have broadband without the cable. So we went out and cancelled the cable and hooked up rabbit ears to our now 8 year old plasma. (When my husband cut the cable, he cut the internet too. Then the clerk offered him a lower broadband rate for 6 months if he would sign back up, which he did.)
I can not tell the difference. The picture comes in clear and we get 21 stations. Our savings is over $100/month. For us, rabbit ears work. I know Crystal likes her cable as you probably know too, but for some, using an antenna may actually free up enough money so that they can afford to pay their bills. So, if you hit a rough patch, maybe you should think about using rabbit ears. Works for us.
Crystal’s Comments: I thought about doing this for a bit, but we really do utilize our DVR multiple times a day, so we’ll stick with cable. Thanks to my mom for offering a personal experience for others! I have seen their tv, and it is a really clear picture with just the rabbit ears!
Do you use an antenna? Do rabbit ears work for you too?
August 17, 2011, at 6:00 am
I went to my first live auction last Friday night! It was a ton of fun – like Ebay on crack!!!
How this Auction House Works
The auction house itself is a warehouse filled to the brim with furniture and knick knacks. Picture walking into one of those gigantic aluminum panelled buildings and not being able to see 75% of the walls. It was also pretty warm since the evenings have been around 80 degrees and there were 100 people shoved into the small open area in the center of the building. Everyone was very friendly and there was huge industrial fan trying to keep the air flowing. Really, it just made my hair fly around, but I appreciated the attempt.
Bidding
Signing up for a bid card was very easy. I gave them my driver’s license to make a copy and they handed me a bid card (I was number 149). Then I found a standing spot along the wall between furniture since all the chairs were occupied. Once they sold most of the stuff around the sitting area, they started setting out more chairs. I grabbed a seat. I only ended up bidding on a few small items all night since I do drive a small car and wasn’t in the mood to hire a company to drop off anything. But I saw a ton of great deals!
They must have sold at least 10 gorgeous coffee tables for less than $150. End tables were going for $25-$50. Solid wood curios were being sold at $85-$225. It was amazing! Next time I go, I may splurge and hire someone to drop stuff off for me to resell. I will also keep in mind that my husband and I are looking for comfortable recliners…
My Buys
As I said, I did make a few bids and ended up buying a few items for a total of $40. It was actually around $36 but there is also a 10% buyer’s premium added on at the end. I am now trying to resell two of the pieces on Craigslist. I think the etched glass bowl that has a little chip on its bottom base is gorgeous and the creamer jug is at least 80 years old since it is a souvenir from a theme park that was only open from 1900-1934, so I think I have a shot to make my money back. Let me know if one of these catches your eye. 
Even if I end up keeping this stuff, I had a ton of fun for $40. I think I actually found another hobby!
Have you ever been to an auction? Any good buys?
August 16, 2011, at 6:00 am
This is a guest post about municipal bonds from JT, who blogs about business, finance, and proper money management at MoneyMamba.
We all know the Joneses; they’re the family we’re not supposed to chase when thinking about our budgets. But now the Joneses are back, and you might just be chasing them in your investment portfolio.
Municipal bonds
Municipal bonds are debt instruments issued by local governments. When a city, locality, or government agency wants to build new roads, bridges, stadiums, or simply fund a local government for the next year, it often issues municipal bonds to raise money.
Municipal bonds are attractive to investors for three reasons:
1. You can make a difference locally, and invest in a debt obligation backed in a small city or town. This sense of “feel-good” investing makes us all warm inside. Municipal bonds are as American as apple pie in this sense.
2. Ignoring current budget constraints, municipal bonds have the second lowest default history. “General obligation” municipal bonds are even safer, since the payments on such bonds are guaranteed by the taxing power of the city.
3. They are a tax-exempt investment. This means that the income you earn from holding a bond is not taxed at the Federal level, and in some cases, at the state level as well.
The combination of feeling great about funding local initiatives and avoiding the IRS at the same time is a deadly one. Often, investors chase the combination in what is nothing more than the investing version of keeping up with the Joneses.
Are tax-exempt investments right for you?
Tax exemption sounds absolutely awesome. And it’s the reason why so many people think that municipal bonds are the best investment for their portfolio. However, in many cases, municipal bonds are best left for the very rich.
Because municipal bonds are tax-free, investors in the highest income tax brackets tend to favor municipal bonds over other investments.
Consider this example: You have income in the 15% tax bracket. Mr. Jones has income in the 35% tax bracket. For the sake of science, we’ll say municipal bonds currently yield 4%.
The two scenarios look like this:
• Your situation – Investing in a tax-exempt municipal bond at 4% is much like investing in a taxable bond yielding a little less than 4.6% per year. After tax code consideration, a little less than a 4.6% annual yield in taxable investments is the same as 4% tax-free.
• The Joneses’ situation – Investing in a tax-exempt municipal bond at 4% is much like investing in a taxable bond yielding 5.4%. The Joneses’ would receive the same amount of income from a 4% tax-exempt investment as they would a taxed investment yielding 5.4%.
The Joneses get a better return with municipal bonds than you do because they have income in a higher tax bracket. They can afford to take a lower rate on municipal bonds than you can, and as a result, they pay more for muni bonds. In efficient market hypothesis language, the tax-code differences are priced into the market.
Know your advantage
When we compare two investments, we should take into consideration each investment’s advantages. We should also look to see if these advantages are priced into the market.
Right now 5-year AAA-rated municipal bonds yield 1.06%. At the same time, 5-year AAA-rated corporate bonds yield 1.30%. (This data can be found at Yahoo Finance.)
The duration is the same, each of 5 years. The rating and safety are virtually the same. The only thing different from a municipal bond, from a high-level view, is the tax code difference. For municipal bonds to be worth your while, you would have to have income in the 25% tax bracket.
Pending that you don’t have income in the 25% tax bracket, you would be best to invest in taxable investments, since the market has priced in a plus or minus 25% difference in yields between municipal bonds and corporate bonds. Think of it as high-income folks are bidding down the yields to account for their tax code advantages, not yours. The rich have a leg-up on you in municipal bonds, and they use it!
Bottomline: Saving money in taxes is great, but not if it means that you lose MORE in income. The highest earners can afford to invest in lower-yielding bonds than you can, but on the upside, you can afford to invest in higher-yielding taxable bonds than they can.
Perhaps more importantly, it’s never a good idea to buy tax-exempt investments in a tax-deferred retirement savings account like a 401k or IRA. If you were to do so, you would be paying for a tax advantage that you don’t need.
Keeping up with the Joneses’ can cost you in more ways than one.
Have you invested in municipal bonds? What’s your take?
August 15, 2011, at 6:00 am
Here is proof that I am soooo not perfect.
Over the weekend, my husband went out to help teach people to Curl and I stayed at home to catch up on blogging. Instead, I piddled around on the internet and played with our dogs. I also remembered that we have been wanting new DreamFit sheets for a long time – like 3 years at least. So I started looking around.
DreamFit
First of all, DreamFit Sheets are freaking expensive!!! I knew they would be since that is why we have been putting buying them off as long as we have, but I decided that our old set was 6 years old and needed a little backup help. And these sheets really are awesome. They are no slip sheets for a deep mattress like our Tempurpedic that truly don’t slip off. Plus, like I said, our last set has lasted as our only set of sheets for 6 years. They are durable as all heck.
The Hunt
Secondly, once I found the cheapest site, I had to decide between the 260 thread count set for $99 or the 400 thread count set for $149. I hemmed and hawed for 30 minutes and even Googled the difference between thread counts. In short, the 400 thread count sheets should be baby-butt soft. So I splurged. I bought the $149 sheets, got free shipping and no sales tax, and considered it an okay deal for great sheets that will hopefully last about 10 years too, lol.
The Double Standard
Then Mr. BFS called me on his way home. I said hi and then told him I had spent $150 on sheets. Was he mad that I spent $150? Nope. Was he mad that I bought new sheets? Nope. But he was frustrated that I spent such a large amount of money without talking to him in advance. Why? Not because he really cared BUT because I’d get mad at him if he did the same thing.
And he’s probably right. I like knowing where all of our money is going before it happens, so I’d get aggravated if he spent large amounts without giving me a heads up in advance. But he doesn’t ever care about what I spend, and we had been talking about new sheets for 3 years, so I never even thought about waiting. That is a double standard…like a money manager’s double standard. Huh…oops.
Anyway, I apologized right off the bat since I understood his point of view. But I don’t think I’m able to change the way I’d react if he did the same thing. I’d still get frustrated with him for spending without advance notice. So, I now really have to remember to let him know in advance despite the fact that he doesn’t actually care. Would it be easier for me to just not care? Probably, but that is not the way my brain is wired. I am a control freak about most aspects of my life and money is a big one. So I’ll just remember to give advance notice in the future so I am not a complete hypocrite.
You do see how this is absolutely hilariously stupid, right? Like a bad sitcom? Good. As long as it’s just not me.
Do you have any weird personality traits like this? Any double standards that you catch yourself at and have to make a conscious effort to either change or follow through on the other way? Or did you stop reading and just want to yell at me when I mentioned $100+ sheet sets?
August 14, 2011, at 6:00 am
The Saved Quarter Challenge Update
I joined The Saved Quarter Challenge this year and was aiming to save at least $21,000 by the end of 2011, but we hit that goal in mid-June!!! My new goal is to save a cool $42,000 by the end of 2011 instead! That would be a tiny bit more than 50% of our GROSS pay from our two full time jobs!!!
Here’s how I’ve done this week for the Saved Quarter Challenge:
I did bank a lot of blogging income too, but I got my last regular paycheck on August 3rd. So from here on out, my blogging income will not be considered savings automatically. I’ll know after the 14th of every month how much can be socked away.
The new $42,000 goal is hopefully going to be reached solely through 100% true savings – 401(k), Roth IRA, emergency fund/savings, home and auto maintenance account, extra cash for investments, and blogging income up to August 6, 2011.
Total This Week: $300
We can save what we do because we live off of a little more than my husband’s salary as a school librarian ($38,000 take home pay). That means we save most of what I make blogging from home and what my husband makes from his hobby job of reffing. Reffing usually brings in $2000-$3000 a year and blogging is bringing in $35,000 or more a year (we’ve already hit more than $24,000 for January-July 2011), and I get to keep about two-thirds after taxes.
Total to date: $32,588 guaranteed, $9,412 to go.
Additonal Info
I will continue posting monthly and yearly blog statistics and income updates, so stay tuned at the beginning of every month!
In case you didn’t know, Alexa traffic rankings are determined by the numbers of hits a site gets by people with the Alexa toolbar. If you want to be part of this ranking community, you can download the Alexa toolbar here.
If you don’t already, you can follow me via RSS or Twitter by following those links.
You can also subscribe to my weekly newsletter with exclusive, subscriber-only giveaways by using the subscription form in the right sidebar ———>
To learn more about the Yakezie, the blogging group that has helped me in SO many ways, check out my Yakezie page! Feel free to email me if you are a Yakezie member or challenger and don’t see yourself on the list!
If you are interested in seeing how I went from an 8 million plus Alexa rank and 3 readers to where I am today, you can see My Blogging Checklists, which breaks down everything I do related to blogging. If you want to see how I have started bringing in more than $3000 a month in less than 18 months, you can check out How I Make Money Blogging.
I have also started a new site, http://howimakemoneyblogging.com/, which will cover how I currently make money blogging and my transition to a work-from-home blogger!
THANK YOU ALL FOR BEING THE BEST READERS EVER!!!
August 13, 2011, at 12:03 pm
Please subscribe to my brand new newsletter to receive weekly updates and links to exclusive, subscriber-only monthly giveaways!
I’m aiming for 50 subscribers by the end of the weekend so the newsletter can start next week! Only 4 more to go!!!
The newsletter subscription is to the right —————>
If you click the “Subscribe” button and nothing seems to happen, wait a minute or so to see if you received the confirmation email anyway.
We are working on the problem but my only other option right now is to use a pop up, which annoy the crud out of me.
My Favorite Posts this Week
Guest Posts at BFS
Thank you!
I Staff Write…A Lot…and I missed posting this update last weekend…
Giveaways
Blog Carnivals
If you are hosting a carnival that includes Budgeting in the Fun Stuff, please email me so I can include it in my roundup. Thanks!
Top 5 Referring Sites to BFS from Last Week:
- Yakezie
- Free Money Finance
- Get Rich Slowly
- Smart Passive Income
- Len Penzo
Feel free to contact me if you have any suggestions. I’d love to add a few more blogs to my regular reading list or at least give a shout-out for great posts or contests.
As always, thanks to all the bloggers that teach me something new every day. Thanks to all my commenters for making this blog the community I want it to be. Thanks to all my lurkers too.
I hope everybody is enjoying this as much as me!
My Other Sites
I have started a new site, How I Make Money Blogging!
Let me know what you think!
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DISCLAIMER I am not a professional or a financial advisor. BFS posts are informational opinions only. Please make your own financial decisions based on personal research or see a financial advisor.
Also, there are paid links on this site. There is no obligation on your part to purchase any products advertised on this website.
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