Tag Archives: savings

Saving at the Pump

How much does a gallon of gasoline cost?  Nobody knows.  The price of gasoline is all over the place in Centre County right now.  A gallon of 87 octane can cost anywhere from $3.54 to $3.85, depending on what station you visit.  Even the prices from one Sheetz to another can vary depending on which end of State College you are on. It’s enough to make you crazy.  I’m accustomed to prices varying from city to city, but not such large disparity within one town!

I’ve never been the kind of person to drive around chasing the best price for a gallon of gas.  But a difference of 30 cents per gallon when I put 13 gallons into my Subaru is $3.90.  That’s more than the cost of one gallon.  And that’s worth driving a little further for—there’s no way that I’m going to burn a whole gallon of gas just driving across town to the less expensive station.

Luckily there are ways to lower your per gallon price, as well as ways to know how much your local stations are charging before you make the drive.  I’ll be honest….that $3.54 per gallon price is at Sam’s Club, so you can only take advantage of that with an annual membership (which I maintain for other reasons—gas prices are a bonus for me).  But there are stations in Bellefonte charging similar prices without a membership fee.  I’m a Sheetz loyalist, but my local Sheetz has the advertised price of $3.85.  I never pay full price for gas at Sheetz, though.  I save three cents per gallon by using my My Sheetz card, and an additional five cents per gallon for using my Sheetz branded credit card.  I also collect rewards and offers on my My Sheetz card, so right now I have an extra 11 cents off per gallon waiting to be used.  That will bring my next Sheetz gas purchase down to $3.66 at my local Sheetz, or $3.56 at one at the other end of town.  Sam’s is still cheaper, but not enough to make it worth going out of my way.

So how is a person to know where to go to get the best price on gas?  Just driving around defeats the purpose.  Thankfully, there is an app for that.  I use the Gas Buddy app on my phone to check the prices at local stations whenever it is time to fill my tank.

Someday I’ll get an electric car so I can avoid all this gasoline nonsense and just charge up at home.  But that’s not an option for me right now.  But I feel like I’m making the best decisions I can to fuel up in an economical way.  Are you getting your best deal on fuel?

 

 

Putting your Money on Autopilot

Routines are a good thing.  When something is routine for you it almost runs on automatic pilot.  You don’t have to expend the energy to remember it.  It just happens.  I brush my teeth before bed.  I feed my cats first thing when I get up in the morning.  I set up the coffeemaker for the next day right after I wash the dinner dishes.  I don’t think about these things.  I just do it because it’s routine.

This semester I’ve found myself needing to establish new routines.  And that’s not always easy. I have to remember to grab a mask before I leave the house.  I have a new travel mug that I’m using for my morning coffee (because it allows me to use a straw I can slip under my mask) and I haven’t adjusted to exactly how much to fill it so it doesn’t splash over when I put the lid on.  I’m getting used to being back in the office after working from home for an extended period which is good (my computer monitors are so BIG!) and bad (traffic in State College isn’t horrible, but it’s much worse than the commute from my living room to my guest room) and good (I get to see STUDENTS!!!) and bad (with the combination of my glasses, my mask, and my headphones for Zooming, I feel like I’m wearing a motorcycle helmet all day).

Experts say that it takes 66 days to develop a habit.  That’s the magic point at which your routine goes on autopilot.  Which explains why I’m struggling with returning to the office after working at home for 17 months.  My work from home routine was on autopilot.  And it’s not easy to build new routines.  You need to focus on doing the same thing at the same time on a regular basis (whether that’s daily or weekly or monthly).

You are likely also working on establishing new routines.  A new class schedule.  A new commute.  And quite possibly a new way of managing your money.  All of these things are much easier to manage once they are routine.  So how do you make managing your money routine?  Last week we talked about putting your “monthly paycheck” on auto-transfer.  That’s the first step.  But you can also set up a lot of your bills for auto-transfer.  And any bills that are not on auto-transfer you should establish a routine for when you pay them.  I always sit down with a pile of bills at the start of every month, right after I get paid.  I schedule all the payments with my bank’s online bill paying system, and then I’m done for the month.  Autopilot.  And I do the same with savings.  I have auto-transfers set up to move money into my emergency fund and my long-term investment account at the beginning of the month.  And my retirement savings comes right out of my paycheck before I even see the money—it doesn’t get more automatic than that!  And my final money routine is to check my recent transactions every morning when I sit down at the computer.  I subscribe to a service that imports all of the transactions on my different accounts into a Google spreadsheet, which allows me to better track where my money is going.  The daily sorting and categorizing of these transactions helps me to manage my budget and alerts me to anything that may be out of the ordinary (hopefully “What did my husband buy at the music store now?” rather than “My credit card has been hacked!”).

While you are working on establishing your new routines, make the extra effort to put your money on autopilot too.  It really can remove a great deal of stress from your life not to need to think about it!

 

Pandemic Training for Long-Term Savings

Saving and investing toward a long-term goal (such as a down payment for a house, or a retirement fund) is surprisingly similar to living through a global pandemic.  That may seem ridiculous at first sight, but if you think about it, it’s true.

  • At the start of it all it seems terrifying and insurmountable.  Any really huge thing can be overwhelming when you look at it from the beginning.  But you have to just take it one step at a time, whether that be wearing a mask or doing a regular monthly deposit into savings.  You do the right thing in small chunks and it adds up to lots of right things over time.
  • There will be ups and downs along the way.  The stock market and interest rates go up and down.  It’s not always in your favor.  The infection rate in your geographic area also goes up and down, not always in your favor.  You buckle up for the ride.  You wait it out.  You play it safe.  And eventually it comes around the other way again.
  • You’ll have to make sacrifices. There will be times that you would rather go on a vacation or buy something fun (or useful) instead of socking away that money in savings.  There will be times that you want to go to a large family gathering, or maybe just sit in a normal law school class….but you have to mask up and hunker down instead.  It’s important to keep your eyes on the long-term goal.  Even if it means sacrifices in the short term.
  • Eventually you’ll see a light at the end of the tunnel.  You’ll hit mile-markers on the way to your long-term savings goal.  The first $1,000.  The first $5,000.  Half-way there.  75% there.  These things make you see that it is indeed possible to achieve the goal.  Just like the recent good news about vaccines in development make us see that it’s possible we won’t be living the pandemic lifestyle forever.  There is a light at the end of the tunnel…but we’re not there yet.
  • At the end of it all, it will have been worth it.  Eventually we’ll get there.  The pandemic will be a historic event that we relay to younger generations and we watch documentaries about.  And the long-term savings goal will have been reached.  You’ll be in your new house, or you’ll be retired, or you’ll have achieved whatever other goal you are saving for.

When you are looking at a long-term savings goal in the future, you’ll have this pandemic to look back on.  And you’ll know that it’s possible to achieve…because you’ll have done it before.

It’s an Emergency!

Emergencies happen.  You never know when.  But they always seem to cost money that you don’t have.  And sometimes they come in rapid-fire succession.  It really seems like when it rains it pours.  And it sure has been pouring at my house lately!

Two weeks ago one of my cats fell ill very suddenly.  She had to spend a night at the emergency vet, which didn’t come cheap.  Thankfully she recovered and I get to continue loving and petting her for the foreseeable future.  And before my credit card even had a chance to cool down, last week I went to wash dishes after dinner and discovered there was no hot water.  When I ventured into the basement to investigate, I found the worst possible scenario.  My aging water heater had died a very ugly death, bathing my basement in the last of its lukewarm water.  The next day I found myself writing a very large check to a plumber to cover a new water heater and its installation.  Within a week and a half I had incurred two very significant unexpected expenses.

Situations like what I just faced are exactly why it is so important to have money saved for an emergency.  In a perfect world I would have had a designated emergency fund in a savings account at the ready to deal with all of this.  But my world is rarely perfect.  This year demonstrates that over and over and over again.  So I had to scramble around to several different bank accounts and investment accounts to cobble together the money to cover these expenses.  But the money was there.  Thank goodness.

It may seem impossible at this point in your life to build an emergency fund.  But like anything else, it’s overwhelming if you start by looking at the end goal.  The trick to success is to start small.  I often think of this old adage:  How do you eat an elephant?  One bite at a time.  Starting an emergency fund is exactly the same.  One bite at a time.  Five dollars here.  Twenty dollars there.  Empty the coin jar.  Clean the couch cushions.  The random $10 bill in the pocket of the coat you last wore in February.  Each of these goes into the designated account that you don’t touch except for in emergencies—preferably one that doesn’t have an ATM card.  And you have to acknowledge that something you WANT rather than NEED is not an emergency.  Then the account balance builds when you aren’t paying attention.  You go on with life and add the stray money when you can.  Next thing you know you have $100.  Then $500.  Then $1,000.  Then enough to cover a sick pet and a new water heater all within a week and a half.  And then the rebuilding starts again.

Do you have an emergency fund?  If not, it’s time to start one.

Out of Sight is Out of Mind

Out of sight is out of mind.  Sometimes this is a bad thing (like when you misplace the Mother’s Day card you bought and forget to mail it until Memorial Day).  Sometimes this is a good thing (like when you don’t have any junk food in the house and you are forced to eat carrots instead).

Knowing that out of sight is out of mind can be a useful tool.  For example, at the beginning of each semester many students receive a large refund of student loan money to use for living expenses for the whole semester.  Getting that money out of your normal cash flow will make it easier to make it last the whole semester.  One option some students use is to immediately pay rent ahead through the end of the year.  Another option (and the one I prefer) is to build a monthly budget (taking into account the amount of money you have) and only allow yourself to use that much each month.  Put most of it into a savings account.  Preferably a savings account for which you don’t have an ATM card and transferring funds takes a couple of days—making it harder to cheat and withdraw funds early.

You should set up a designated “pay day” when your month’s funds transfer to your more accessible checking account so you have money for rent, food, laundry, and other living expenses.  The key to this working is simple:  DO NOT PAY YOURSELF EARLY!  If you do, you may find yourself subsisting on Ramen and hot dogs during finals.  Because money is a finite thing.  Unexpected windfalls rarely happen.  If you run out of funds and don’t have more coming for several weeks, you’ll be uncomfortable for a while.

Out of sight is out of mind.  So put your case books in plain view and stash your money away where it’s harder to get to.

 

What If: A Month Without Pay

The government has reopened!  But my heart goes out to the many people who went more than a month without pay.  Yes…they are going to be paid now, even if they were furloughed during the partial shutdown.  But that doesn’t take the sting out of not having the money when expected.

I, like so many, live paycheck to paycheck.  I have a tiny bit of savings, a really tiny stock portfolio, and a retirement fund.  I do not have the recommended three-to-six months of expenses tucked away in an emergency fund.  If I were to have to go without pay for a month I would be up the proverbial creek without the requisite paddle.  I suppose it could be worse.  My parents would probably be able to float me a loan.  Or I could borrow against my retirement savings.  I have credit cards I could use.  But none of these ideas appeals to me.  I’m 51 years old.  I’m supposed to have a strong understanding of money.  Yet here I am without emergency savings.  I’m flying without a safety net, mostly because I never thought about the fact that I might someday fall.

The government shutdown has really brought the importance of a contingency plan to the forefront.  What would you do if you found yourself without anticipated income for a month.  Would you be able to keep yourself afloat?  Do you have somewhere to turn for short-term help?  It’s always good to have a backup plan in place.  We never want to think about the worst case scenario.  But it could happen.  And you should prepare for it just in case.

Procrastination Has a Price

Sometimes procrastination can be expensive.  I discovered recently that I had become complacent about some things in my finances.

I told you last week that I had bought a new (to me) car and had used financing available through the dealership that was not my best deal.  I knew when I bought the car that I was going to refinance the loan at a lower rate with my credit union.  But I bought the car in May and didn’t get around to handling the refinance until November.  Now that it’s done, I’m paying $8 more per month, but for 6 months less than it would have been had I not refinanced.  Ultimately this is saving me more than $900 in interest.  If I had done it sooner it would have been a lot more.  But I procrastinated.

My husband used to drive for Uber.  If you’ve ever been picked up by a really big guy in a little black Prius, that was him.  But he decided to give up the driving business after spring semester.  I should have called my insurance company immediately to let them know that our vehicle usage had changed.  But I procrastinated.  I finally reached out to my insurance company last week, and now I’m going to be paying about $30 per month less for my car insurance.  Procrastination cost me $150.

I’ve long been a fan of online savings accounts.  The interest rates are always a lot higher because they don’t have the overhead expenses that bricks and mortar banks do.  I jumped onto the online banking train nearly 15 years ago with ING.  A couple of years ago ING folded and all of a sudden my accounts were with Capital One 360.  I’ve never loved Capital One, but I didn’t really think about it at the time.  No banks were paying much in interest at the time, so I just rolled with it.  But savings rates have been creeping up for the last year or so.  I decided to take a look to see where things were with Capital One 360 and was surprised to see things were not so great.  Their rates are comparable to other online banks, but only if you carry a balance of $10,000 or more.  Since I don’t have anywhere near that, I was only earning about half of what I could have been on my meager savings.  So I started shopping.  Now I have a brand new online savings account with Ally Bank (one of three options I decided were worthwhile—Discover and Amex also have great rates and good reviews).  I’ll be earning almost twice the interest I was before, and I no longer have to deal with a bank I never wanted to choose in the first place.

Finances are definitely a participation sport.  You have to put in some effort to get the best results. If you don’t….you end up missing out.  Procrastination can be expensive.  Have you been putting the necessary work into your money?  If not, it’s time to think about it!

Vampire Power and the Great Cable Experiment

Back in September I wrote about my great cable TV experiment.  I cancelled my cable and now do all of my television viewing through Internet streaming.  Four months later, I still don’t miss cable at all.  I’ve found that I read more.  I listen to music more.  I go to bed earlier at night (and reap the benefits of a decent night’s sleep!).  I don’t just “tune out” in front of the TV anymore.  Yes…I still vegetate on the couch from time to time.  I’ve been binge watching Parks and Recreation and Scrubs for the last couple of months.  But I definitely spend a lot less time staring at the screen.

cable box

I’m not surprised.  I expected all of these results from my cable cancellation.  But there is one specific side-effect of cutting the cord that has been a very pleasant surprise for me.  My electric bill has gone down.  Significantly—about $10 per month!  I always knew that my four (yes…FOUR) cable boxes were sucking vampire power while they weren’t really in use.  But I had no idea how much.  It seems cable boxes (especially DVRs) are among the worst vampires around, using more energy than most appliances.  A new agreement is going to make sure future cable boxes are more efficient. But in the meantime, you may want to consider plugging those set top boxes into a power strip that you can flip on and off.  Or just cut the cord altogether, like I did. 😉