Personal Finance Resources

With the recent soar in gas prices, I feel compelled to contact my readers and urge them to take action against the oil companies. Goldman Sachs has put out a recent estimation that the price for a barrel of crude oil could reach as high as $200. Currently the price is somewhere around $120 per barrel. So, if the price of gasoline at the pump is somewhere around $4 nationwide now, then the price at the pump with crude oil being $200 per barrel would be somewhere around $6.50 per gallon! Do you think you are stretching now on your gas bill? Do you think food prices are high now? Just wait.

The only way the American people can influence the price of gasoline is too reduce their consumption. I am putting my best foot forward by looking for a motorcycle to buy, and severely limiting my trips around town, and out of town. Getting the number of miles driven down combined with obtaining a much more fuel efficient vehicle will dramatically reduce the number of gallons of gas I will be buying at the local gas station.

But let me just give you some suggestions and ways that you can cut back on gasoline consumption, some of these are obvious, and have already been covered, but I want this to be a fairly comprehensive list, so here goes:

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I have put feelers out there, but as of yet, I don’t have any solid leads on obtaining a motorcycle. But as you know from my Motorcycle Gas Mileage article, not only can you save a lot of money getting a motorcycle, but you learned how highly I esteem the Honda brand of vehicles (that was thrown in here for free ).

This xls spreadsheet is super easy to use. In the input area, all you have to do is enter the price per gallon of gasoline in your area, the current mileage you are getting on your car or truck, the mileage the particular motorcycle you are interested in is getting, and the average number of miles you drive in any particular month. The calculator then spits out the top end price that you can spend on your motorcycle in order to get paid back in full over a specific number of months. So given the defaulted values, if you spend $560 for your motorcycle, the gas savings that you will receive will pay for your motorcycle in just 6 months! If you spend $1,120 on your motorcycle, it will be paid back in gas savings in just 1 year, and so on.

I came up with this tool in order to see what the top price would be that I could spend in order to get paid back around 6 months to a year. So I have done all the work, and you can download the spreadsheet for free!

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Continuing on the theme that I was writing about in my last article, I wanted to give you a specific example that happened to me just last week in property management. A friend on mine that I manage property for referred me to one his friends to help him get his property leased. This man seemed very friendly and easy to work for. His house payment was somewhere around $1,200 per month, and you guessed it, the going rate for a property like his in that area was somewhere around $1,200-$1,300 per month.

So after talking with him, he wanted to gross $1,350, but I needed to make at least $100 per month to manage the place. So I decided to go ahead with the property management marketing for him without an agreement up front. Now, normally when I manage property, all the money flows through me, so the problem of having the up front written agreement with the owner is not “as much” of an issue. So I proceeded to market the property for $1,500 per month, well over the going rate for the area.

Well, when the rubber met the road, I was only able to rent the property for $1,400 per month. So I went ahead and got the contract going with the new tenants. But when I talked to the owner about it, he wanted to manage the property, and just pay me the monthly fee that we agreed on. Now, I went ahead and met him in the middle, and dropped my fee down to $75 per month. So getting the news that he was going to take care of all the hassle of the tenants really had me excited.

The Penny Drops… 

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In today’s world, you never really know anybody. Think about yourself, and your family members, do you have a cousin or uncle that you just wouldn’t trust to even feed your dog while you are on vacation? Well if that’s true, do you think that strangers you are trying to do business with deserve any more trust?

In my short experience in property management and real estate investing, I have seen some very wicked things go on. Extensive damages to property, lying, cheating, playing on your heart’s strings, all examples of people’s lack of integrity and failure to take responsibility.

Here is the quick tip for today, make sure when you are doing business, if you don’t know the person implicitly, get everything in writing, and get it up front. I know it is extra work, and work that may end up not being paid, but nonetheless, get a contract. Things will just go better for you that way. Next week, I will outline a specific example of how I was taken advantage of, and how you can protect yourself.

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This is a great little tool that I found out there in internet land. If gives you quite a lot of information and flexibility to adapt to any market you may be in, factoring appreciation and repairs, to give you a solid estimate of what will be better for you. I usually lean toward the side of buying, but it certain markets and depending on your job / travel situation, it may be better to rent. Use this tool to find out which is better for you.

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Recently, there was a major storm that came through our area, and delivered baseball size hail to our property. Yes, I said baseball size hail. It was a serious storm cell that produced a tornado about 15-20 miles south of us. Now, our house is somewhat protected by two massive live oak trees, but even with those trees over us, we still had hail hitting our roof. Now, I don’t know what to look for in hail damage (unless it is so obvious that shingles have been torn off the roof, or there are giant holes in the roof, etc), but I did see some of the shingles on our main roof had curled up corners.

Now I think a lot of people might have just disregarded this, and considered that the roof was fine, and no need to call the insurance company. But knowing the preexisting conditions of certain areas of our roof, combined with the recent storm, I felt compelled to ask for an adjuster to come out and look at the roof. Now, I know what you are thinking here, that I just made up a bunch of stuff about the roof and blamed it all on the recent storm. That is just not true. When I was asked questions about leaks into the house, etc. I was completely honest and mentioned that there were previous problems with the roof.

Even if a person is a good liar, these insurance adjusters are not idiots. You aren’t going to convince them that they are wrong. So I had the adjuster come out, and concluded that there was significant damage to the roof, and he came up with an estimated cost to repair, less our deductible, and we are waiting on the first check.

What to Do When Considering to File a Claim with Your Home Owner’s Insurance 

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America is a funny place to be. As long as you have high balances at the bank, no problem. As soon as you hit a snare though - watch out. Most banks are large chains with policies and rules, and they are totally unwilling to work with their customers. This normally results in excessive fees, which further your financial problems. I have even had one situation where the bank processed several checks on the same day, and a deposit, and the order of their processing was structured in such a way that they were able to justify charging an overdraft fee.

Situation 1 - Dishonorable Check and Deposit Processing

The situation outlined above actually happened to me. There were 3 checks that I had written, with quite varying amounts, that all hit the bank on the same day. I also had a deposit that processed on that same day. Now, the dates on the checks did not match up with the order they were processed in. I thought that banks would process checks in the order they were received, and if they were received at the same time, that they would process them in order by the date they were written. However, what I found was that the bank processed the checks in order from largest amount to smallest amount. Furthermore, they processed the checks before they processed the deposit. The net result for me was that I ran negative for part of the day, and then came back into the positive at the end of the day. What was my reward? You guessed it, an overdraft fee.

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If you are strapped for cash, but have a little that you would like to invest in real estate, than the use of an REIT, or real estate investment trust, can help you gain an entrance to several different pieces of property at the same time. This article will give you some basics about this particular type of investing.

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I want this one to be short and sweet, so I want to give you some ideas for very low cost or free ideas for your weekend entertainment. So here goes:

• Going for a walk at the local park. My wife and I love this idea because it is absolutely free, and the scenery is beautiful.
• Going camping. Once you make the initial investment to get the tent, bed rolls, mobile kitchen, maybe some hunting and fishing gear, you are in for a very affordable trip. Just hit spots like your local lake or park and setup your camp spot.
• Fishing or Hunting. Again, after a little bit of initial expense, this is a very low cost method of entertainment.
• Watching a Movie. You can find movies at groceries stores and even fast food restaurants in a vending machine that can be rented for just one dollar.
• Grilling Dinner. This is one of my favorites. Some chicken, steak, pork loin, ribs, etc and some great seasoning, and you have yourself a meal fit for kings.
• Going Swimming. A fun and very cheap way to get some exercise or just relax.
• Sand or Beach Volley Ball. Many public parks have a sand pit for just such an occasion. Just get a volley ball and have fun.
• Tennis. Again, your local public park will probably have a tennis court. All you need is a couple of rackets and a tube of tennis balls, and there you go.
• Basketball. The easiest. A basketball and some good running shoes and you are ready for action.
• Online Games. Websites like candystand.com offer free, fun games to play.
• Puzzles. One of our favorites. Puzzles are cheap and can offer a great chance for a couple to work together to solve, and provide a good time for fellowship.
• Card Games. This is another cheap, fun one. Our favorites are hearts and spades, the vicious heart wrenching card games are close to our ‘heart’.
• Video Games. Game systems like the Nintendo Wii offer some fantastic lifelike action without the hassle of a bunch of different equipment and having to make the drive.
• Working out. Not one of personal favorites, however there are many people that find it quite relaxing and fun to go the gym and exercise.
• Board Games. Classics like Monopoly, Life, and Trivial Pursuit are fan favorites.

These are just a few great games and entertainment you can do on a shoe string budget. I hope I was of help here, and if you have some of your own great ideas, please list them below in the comments section.

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Now that you have a few ideas for finding items to sell, it is time to learn a little bit about how to run a successful garage sale. There are three things that are going to make you successful when running your garage sale - having items that people want, selling them at a low price, and organization. Yesterday’s post covered obtaining items that people would want to buy, so let’s cover the other two in a little more detail.

Selling Items at a Low Enough Price

This one, unfortunately, is going to take some experience to really get an idea of what price people will pay for certain items in your area. When you are just starting out, I would advise you to watch the newspaper for garage sale ads where the same address pops up week in and week out. This will give you an idea of what your competition is, will help you to weed out bad data like people just trying to get rid of their stuff and move, and you can shop their garage sales to find out what they are charging for their items. If you really wanted to get serious, you could talk to them a little bit, and find out how long they have been in the area, if they run a garage sale every week, etc.

People expect to get items cheap at garage sales, but that doesn’t mean you can’t make money. It just means that you have to pay that much less for the items you buy, in order to turn a profit. A few weeks of shopping and collecting data from your competitors will give you the edge you need in pricing your items.

Garage Sale Organization 

This is arguably as important as the having the right price. People that drive up to a garage sale that is in disarray, no prices listed on the items, etc. are far less likely to buy anything from you. We are an economy that is driven buy Walmart and grocery store style selling, and people want to know what you want for the item before they make an offer. Often, if the price is right, they won’t even challenge your price, they will just pay you for the item and go their way. So having organization is extremely important, but more specifically, focus on these particulars:

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