Things Do Happen In Threes, Just Ask The Water Froggies

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Last month I wrote about how we need a new dishwasher soon as our current 13-year old machine has sprung a small leak.

We were alerted to the leak by a small water froggie device that I had placed under the machine.  A while back, I got six of them from Woot.  They’re as you might think, a small device that looks like a frog that beeps when the sensors on the bottom come in contact with water.

I put the six devices around the house.  Under the dishwasher, under the washer, next to the hot water tank (two), under the kitchen sink, and under the bathroom sink that gets used most often.

For now, the dishwasher is still running. I have a lid from a plastic bin that I put under the dishwasher that catches the small amount of water that comes out.  It actually evaporates pretty quickly, so although I check it every now and then, the leak hasn’t gotten any worse.  I’m hoping for another three months as I know there are usually pretty good sales on appliances around Memorial Day.

But, as it turns out, the water froggies have been busy!

A couple of weeks ago, my wife called letting me know that there was a leak in front of the washing machine, and that the froggie under the machine was beeping.  We have a front loading machine and we both assumed that this was because a piece of clothing got stuck in the door, something that happens now and then.

Turns out, it wasn’t, as the next load caused another puddle.  Upon further examination, a small piece of the rubber seal had broken off, so there was no longer a firm seal around the door.

Luckily for us, we have an appliance repair plan through our gas company that services broken down appliances.  We didn’t use it for the dishwasher because the thing is noisy as all heck, the insulation is broken down, and the motor sounds like it’s about ready to go so they probably wouldn’t fix it anyways as they won’t fix end-of-life appliances.  But, they did fix the washing machine.  So, we got a brand new rubber seal which took care of that problem.

I commented to my wife that things always seemed to happen in threes, so we were due for another froggie going off.  Since the water heater is also an original, I said that would probably be the next thing.

Turns out, I was right about the ‘threes’ but it wasn’t the water heater.

Before by nateOne, on Flickr

On Sunday, my wife was cutting up a bunch of vegetables for the week, including jumbalya that day and soup later in the week.  I was downstairs in the basement in the play room and heard the disposal stop and start a few times.  I registered that something didn’t sound right, but it didn’t really hit me that anything was wrong.  Suddenly, she called me upstairs.

She said that the disposal wasn’t draining. She had put a bunch of carrot peels down, and it was running, but it wasn’t draining.

I know my wife knows how to run a garbage disposal (flip a switch) but I still figured I’d make sure she had covered the basics, so I walked over and hit the switch.  The mess started to go down.  I kind of smirked when suddenly, I felt water at my feet.  And, then the water froggie started beeping.

Turned everything off and opened the cabinet doors to find carrot-geddon had occurred.

Apparently, the disposal did its work and crunched up the carrots but it wasn’t able to send them down the drain fast enough, so it clogged the u-pipe drain.  I figure that stopping and starting the disposal created a vacuum effect similar to if we’d used a plunger.  The pressure built and built until something had to give.  Turns out, what gave was the clamp holding the various pieces of pipe together.  It popped loose sending carrot peels and water everywhere.

The fix was simple enough.  Unscrew the other side of the pipe, take out all the carrot peels, rinse out the pipe, and run a shop vac to the rest of the line, trying to pull out any peels that had made it downstream. Put the pipe back, and re-fasten.

That was the easy part.

The hard part was cleaning the finely minced carrot peels that had exploded everywhere under the sink.

The shop vac took care of most of it but still, going back and cleaning every nook and cranny as well as wiping down every item that we stored under the sink, as well as clean up the floor that had seen the overflow….well all that took about two hours in total.  And I’m sure we’ll still be finding carrot flakes until we rip out the cabinets despite my best effort.

It wasn’t as catastrophic as having melted a hole in the floor, a story shared on Jana’s blog last week, but it definitely tried.

So, when I commented that we were due for a third froggie beeping, turns out I was right, though just not on the one that would beep.  Now that I got that right, let’s hope that these things go a good long time with silence.  I’m tired of all these leaks!

Thanks for reading! Please subscribe to my RSS feed, follow me on Twitter, or check out my Facebook page. This original Money Beagle post Copyright 2012 Money Beagle is authorized to appear only on www.moneybeagle.com. Thank you for reading and remember: It’s a great day to be alive!

The Wrong Thing To Focus On When Re-Financing

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We re-financed last year as have many homeowners who are taking advantage of historically low rates.

One thing that I’ve seen in some of the discussions about re-financing is a focus on the wrong thing.  See if you can spot what’s wrong with the following hypothetical statement:

“Our current 30 year rate is 6% but we’re able to get our re-financed 30-year loan at 4.25%.  This will save us $350 per month!”

On the surface, this looks like great news all around.  Lower interest rate, saving more money, what could possibly be wrong?

Simple: The focus on the monthly payment is misguided.

In this scenario, you’re going from an existing 30 year mortgage to a new 30 year mortgage.  This means it’s thirty years from the re-finance date, meaning that your total time of paying the bank is thirty years plus however long you already spent on the original thirty year note.  If you’ve been paying for five years, that means you’ll be working on this loan for thirty five years.

On top of that, part of the ‘monthly savings’ that the hypothetical homeowner is so happy about comes, not from the lower rate, but from the fact that they’re spreading the remaining balance over additional years (in the example above, thirty years versus twenty five years).

When you’re re-financing, it’s my advice to look at how much time you have remaining on the existing mortgage, and strive to shorten it, or at worst, keep it the same.

In the example above where the homeowner has already paid five years on the original note, their new mortgage should be no greater than twenty five years.  Ideally, they should go for a fifteen year note.

This could mean that the homeowner might have to pay more than they did every month.  If you’re looking at only the bottom line, many will rule this out, even if they have the income to do so.  But the benefits are tremendous: You’ll apply a ton more toward principle and you’ll get done paying the mortgage that much earlier.  And your interest rate will be lower.

In the example above, going to a fifteen year mortgage might end up costing the homeowner an extra $150 over what they’re paying today.  If they can afford that, though, they shave a total of ten years off of the time that they pay on the house, and they pay a fraction of the total interest cost.

Now, if your payments are already stretched to the limit, fine.  Go ahead and get the thirty year re-finance, but instead of banking that extra money from the lower payment, keep your payment the same as what you were paying.  One hundred percent of that extra payment goes toward principle, so you’ll end up paying the mortgage off way faster, keeping with my goal not to exceed the term of your original loan.

In the example above, sticking with a 30 year note but plowing that ‘saved $450′ right back into the mortgage could have them paying the new loan off in, say, twenty years.  Add the five years from the original note, and they’re paying for a total of twenty five years, still way ahead of the original thirty year loan.

That’s five years less of stress!

If you’re in the market for a re-finance, great.  Just make sure to focus on the right numbers!

Thanks for reading! Please subscribe to my RSS feed, follow me on Twitter, or check out my Facebook page. This original Money Beagle post Copyright 2012 Money Beagle is authorized to appear only on www.moneybeagle.com. Thank you for reading and remember: It’s a great day to be alive!

Figuring Out the “Where” Of Retirement

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Planning for retirement involves asking – and answering – a number of important questions. When are you going to retire? How are you going to save money for your post-career life? What investment vehicles (IRAs, 401Ks, Aurora Bank money markets) will you use to insure the optimal amount of savings? Certainly, there are plenty of questions to ask and factors to consider whenever retirement comes to mind.

But while you’re busy answering the whens, hows, and whats of retirement planning, make sure not to forget an important but oft-overlooked question: the “where.” Specifically, where do you envision retiring when the time comes? You don’t need to have concrete and detailed plans, but it’s important to have a good conception of your retirement location when planning savings and spending during your work life.

The first step in addressing the “where” is to determine whether you plan to stay in your current home, move elsewhere (i.e. to a condo or smaller residence) in your local area, or move to another region of the country or the world altogether. Most people choose to stay in their local area out of contentment, familiarity, and family ties. If this sounds like a situation that you may find yourself in, you then want to determine whether you stay in your home or try to downsize your residence. My wife and I could never imagine leaving our home once our mortgage is finally paid off. Others, however, want to seek out a smaller living space or a more vibrant neighborhood once their careers are over and their children are grown. And still others, of course, will choose to move across the country in search of warmer weather and a more retiree-friendly lifestyle.

So what’s the value of figuring this all out now? While it’s always good to plan ahead from a logistical perspective, the real benefit of location planning is much more real: it allows you to answer the “how” question and determine exactly how much money you’ll need for retirement. The general consensus is that a retiree will need 70 to 80 percent of their annual income in order to retire comfortably. Use this number as your starting point. Then, factor in the “where.” If you plan to stay in your current home, expenses will generally be lower and you can bump down your estimate to as low as 60 percent. You may also be able to save less if you plan to move to a college town or to a rural area where the cost of living is lower. On the other hand, a move to a condo downtown or to a highrise in San Diego will likely push you to the 80 percent level and beyond. This isn’t simply the result of housing costs; it also reflects higher entertainment and meal expenses, two areas where retiree spending falls on all parts of the spectrum.

All this is to say that location matters when retirement is concerned, and that you can best plan and prepare by considering location sooner rather than later. You may find that your location allows you to save less than you originally thought. Or you may need to save more or retire later in order to live comfortably in your desired location. Either way, it’s good to ask the “where” of saving now so that you can enjoy the “where” of retirement later.

This is a guest post.

Thanks for reading! Please subscribe to my RSS feed, follow me on Twitter, or check out my Facebook page. This original Money Beagle post Copyright 2012 Money Beagle is authorized to appear only on www.moneybeagle.com. Thank you for reading and remember: It’s a great day to be alive!

Should College Students Be Forced To Have Health Insurance?

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I wasn’t aware of this, but apparently more and more colleges are requiring that students have health insurance.

One of our local papers reported that Michigan State is the latest school to put this type of program in place, and say that it’s currently in place or rolling out at 25% of colleges across the country, a number that is growing.

The cost ($1,500 per year) is nothing to sneeze at, but when it comes to health insurance, is actually pretty cheap, though I’m guessing it’s a pretty bare bones plan, and that since most college kids stay reasonably healthy, is a pretty low cost plan to the provider as well.

Still, it raises a few questions:

  • What if you forget to provide proof?  Could you get billed for coverage you already have? If so, will some simply overlook this or have an administrative battle on their hands to back out of it?
  • Is this any of the schools business?  The article I posted the link to never really indicated the rationale behind this, except to say that colleges want to ensure that students don’t have to choose between education and paying for a health care bill.  I can see this but it seems a little flimsy.
  • Is this tied into Obamacare somehow?  I thought this bill required that everybody have health insurance by a certain date.  Is this a way to get in front of this for the student population?

Back in my college days, I was covered under my parents insurance plan, so this wouldn’t have applied to me.  But, I expect more and more students are uninsured, and I wonder how this affects them.

If you were attending college, would this type of requirement make you more or less likely to attend that particular college?  Do you see this as an infringement on a students right or as a way to take a potential bad decision out of the students hands?

Thanks for reading! Please subscribe to my RSS feed, follow me on Twitter, or check out my Facebook page. This original Money Beagle post Copyright 2012 Money Beagle is authorized to appear only on www.moneybeagle.com. Thank you for reading and remember: It’s a great day to be alive!

Staying Accident Free Pays Off

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Our auto insurance through Allstate renews every six months. They send out a new policy with insurance cards and let us know how much it will cost.

Like everything else it usually goes up.

So I was very pleasantly surprised when I saw it going down, by about $25 per month.  Upon further inspection, I saw that everything stayed the same on the coverage, but that we had moved from Premier to Premier Plus status.

I contacted my agent and she confirmed that we got this status after having not filed a claim for five years.

That’s pretty cool.  Of course, on the flip side, if you figure that for the last five years they’d been getting an ‘extra’ $25 per month, they made back $1,500 out of whatever claim it was I had last filed.

But, I digress.

I also saw that they have a new program where if you pay up front, we qualified for an extra $10 per month discount.  So, I decided to do this.

Saving an extra $35 per month is pretty nice.  Right now, I’m still allocating the monthly amount toward our insurance ‘sinking fund’ as before just because I don’t want to rely on getting this discount, only have the cost come back should we ever need to file a claim.

Now, the trick is to stay accident free.

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The Economics Of Free Coffee

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I’m not sure if it’s a national or regional thing, but McDonald’s has been giving away a cup of free coffee on Wednesdays for the months of January and February.

This is awesome for me because I love their coffee, and there is a McDonald’s on the way to work.  Since I go in pretty early, I beat the rush, and I can hit the drive through and get my free coffee and be back on my route in under five minutes.

I think the free coffee idea is great.  First, I’m sure a lot of people that stop buy something else, so they make up the lost sales elsewhere.  Second, it exposes people to the coffee that might start coming back.  It is darn good coffee!

So far I haven’t bought anything else so I’ve been an admitted mooch.

But, I’ve noticed that the amount I get has gone down slightly since I’ve started taking advantage of the deal.  When I get to work, I pour the coffee into my regular coffee mug so that I can add sweetener to my liking.  When I first started going in early January, I could fill my mug up and have enough in the container to pour another half cup or so.  As time has gone on, I can now pour one mug full, meaning that they’ve apparently created an ‘extra small’ version.

I can’t complain.  After all it is free.

Is McDonald’s running this promotion anywhere else?  Do you feel guilty if you get a free item and don’t buy anything else in situations like these?

Thanks for reading! Please subscribe to my RSS feed, follow me on Twitter, or check out my Facebook page. This original Money Beagle post Copyright 2012 Money Beagle is authorized to appear only on www.moneybeagle.com. Thank you for reading and remember: It’s a great day to be alive!