Round Up When You Pay Your Bills

Back in April I talked about how I was using my credit card again (and how apprehensive I was about it).

I mentioned my strategy would be to pay it off every day. It’s a bit of a hassle because my payments usually take two days to post, so I end up running around scared that I haven’t paid off the bills (need to work on a better system for that). I’ve since set up mobile banking on my phone as a shortcut so I can log in super quick and make bill payments as I go.

Since I have a cashback credit card, it occurred to me that I should buy things with it that I would normally pay for via debit or cash — and as long as I covered the difference, I’d be OK. That’s been going mostly well, but I did come up with what I think was a great idea: round up.

Some bank accounts offer a service where if you pay for something by debit, they round up the payment and put the difference in savings for you. So that $2.04 coffee becomes a $3 coffee, except only $2.04 goes to store and that $0.96 goes into savings. Great idea, right?

What I’ve been doing is just as good, I think: I always round up to the nearest dollar (or tens of dollars, depending on what it is) when I pay back what I spent. So, if I spend $2.04 on a coffee, that’s $3 against the MasterCard — the balance goes up $2.04, then down $3, for a net win of $0.96. When I spend more — say I buy groceries and it costs me $17.85, I pay off $20 so I wind up lower than where I started.

If you’re making minimum payments, this will also serve to pay down the principal faster, as that extra $0.96 goes against the principal.

Now, you only want to do this when you’re paying part of a bill. If your phone bill is $76.87 and you don’t have a past-due amount, you don’t want to pay $80, because that would be extending a $3.13 no-interest line of credit to your provider, which doesn’t make sense.

Give it a shot! Round up when you’re working to pay down your bill as much as you can. You’ll nick and dent that credit card bill into oblivion!

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Let The Vacation Begin!

Well, that vacation I talked about in my first post starts today! I’ll be leaving YVR this morning and will be landing in the very early morning tomorrow, which is kind of cool.

I don’t fly often at all (well, I went to Vegas for a wedding last year, but that hardly counts!) so I’m really looking forward to the trip. I like flying, I find it very relaxing, and I’m looking forward to seeing all the sights and having a great time overseas. I’ve budgeted a ton of coin for this, so I’m not worried about money, but I won’t be spending like crazy, either.

I land back at YVR on June 4, so until then I’ll be relatively incommunicado. I’ll try to reply to a few comments, but no promises.

I’ve written a slew of posts in advance, so there will be regular postings while I’m gone — it’ll almost be like I never left, except some of my new blogging friends will notice I’m not commenting on their posts as much 🙂

Au revoir!

Cut Your Electric Bill With Common Sense

Anyone who knows me knows that I’m a gadget nerd. I love technology. I have a bitchin’ home theatre system. I have a bunch of computers and cell phone chargers everywhere. I’m fortunate that here in BC, electricity is relatively cheap, but the bills add up.

They always say to turn off the lights when you leave a room, which has always struck me as kind of redundant, because who doesn’t? Who likes changing bulbs often and racking up the electricity bill by having lights on and not using them?

You could be wasting electricity, however, through what’s known as “phantom” or “vampire” drain. The reasoning is that all electric devices consume electricity, even when on. It’s active sometimes — your TV, for example, uses electricity to keep its RF receiver on so that the remote works when you hit the ON button — but sometimes the drain is just wasted current. This is especially true for high-power devices, such as (again,) TVs, refrigerators, stoves, receivers, stereos, and even cell phone chargers. The cell phone charger is one of the bigger culprits as odds are your charger is consistently plugged in so it is there when you need it.

All of these things consistently draw electricity even when not in use. So the solution? Unplug them.

Do you need your charger plugged in when you’re at work? Do you need your TV plugged in while you sleep? The same goes for your computer and your router and modem — it’s great to be able to use your computer instantly, but leaving it constantly plugged in is a waste of electricity and, incidentally, bad for your computer. But money savings are there. So how do you do it?

Unplug!

You can manually unplug your devices when not in use. This isn’t realistic for some — your stove or fridge, for example, should remain plugged in — but if it is feasible, unplugging your cell phone charger or your TV can save you electricity. I rarely use or watch my TV, so this makes sense for me. There are other devices you don’t want to unplug, like your clock radio, for example, but what you can unplug, you should. But that can be a hassle so…

Use A Power Bar

If you have a ton of electronics, consider a power bar. Plug your devices that you will unplug into one power bar, and the “always-on” items (a set-top box, for example: mine takes quite awhile to boot up) into another. For example, you might include your TV, Xbox, PS3, and so on on your “off” bar, and turn off the bar when not in use. You could leave the “on” bar alone.

But make sure that you unplug or turn it off when not in use! A power bar does not save electricity on its own, you need to do something to make it happen as well!

Use A Smart Power Bar

There are “smart” power bars that will “auto-off” when not in use. One from Belkin, for example, is very cool:

Basically, how it works is this. You have one MASTER slot, five SLAVE slots, and two ALWAYS ON slots. So, for the example of a TV setup, you might plug your set-top box into the ALWAYS ON slot. You’d then plug your TV into the MASTER slot, and your PS3, Xbox 360, receiver, and amp into the SLAVE slots.

Here’s the cool part — when the bar detects that the TV has been turned off, it automatically shuts off current to the TV and to the slave slots! How cool is that? It makes sense that when your TV is off, you don’t need to have your VCR (assuming you have one…) on. Obviously, if you have a receiver that you use as part of your music system, you might not want that slaved to the TV. In fact, you might want to have it on a different switch altogether, as you’ll still want to shut it off when its not in use.

Use Automatic Timers

You know those little timers you can get? These things are great for powersaving. If you have equipment that you only use during a set period, try plugging them into one of these as it can make your life a lot easier. For example, you could plug your router into this so that it turns off when you go to bed and on when you wake up, and again goes off when you’re at work and turns on just before you come home. Unless you run a server or torrent during the day, you don’t need your Wi-Fi to be broadcasting. You can plug all sorts of things into the timer and save electricity. Obviously the timer itself will have to be powered, but you’ll likely save in the long run. In fact, even plugging a power bar into a timer and then plugging your home theatre system into that is a way you could save — using an on/off method on its own would likely be better, but this could make it a little more painless.

Reap the Benefits!

That’s it! Watch your bills drop, and this is the cheap and easy way to do it. If you do invest in advanced monitoring equipment or in Smart power bars, you might find even better savings. I, for example, use power bars anyway so simply unplugging them / turning them off is an easy solution for me. I spend about 40 hours a week at work, as does Marie, so that’s at least 40 hours a week we’re not watching TV. In fact, if I had to hazard a guess, I’d say at most we watch 2 hours of TV every few days. That’s a lot of time that we aren’t using the equipment!

So, here’s my plan:

  • Use timers for my cell phone chargers: I have a bedside dock that I only use when I go to bed. I’ll set it so that it’s on from 11-7, which is more than enough time to charge my phone.
  • Unplug the other chargers: I’ve gone through a ton of phones, so I have a ton of microUSB chargers throughout the house. I’ll unplug them unless I need them.
  • Turn off my computer when not in use: I’m bad for this — my home PC is on right now and I’m not using it!
  • Set up “Always On” and “Turn Off” power bars: my theatre setup uses over two powerbars. I’m going to consolidate as best I can so that my router and so on are “always on” and that my other crap is on the “turn off” switch. I might end up cascading power bars to get this done, just given the way my area is setup. But I have my receiver, amp, Xbox, PS3, Wii, Kinect, and TV all plugged in right now (sure I’m missing one or two). For my always on, I”ll have my router, set-top box, network attached storage drive, and modem plugged in. The only concern there is my set top box, which takes quite awhile to initialize, but I might end up setting up a timer with this one so that it turns off at night / at work.

I’m pretty good with the other stuff — I’m a bit of an environmentalist — so we’ll see how much money savings this gets me. I’m mostly thinking about it because with Marie and me in France, we won’t exactly need our router and TV on while we’re away (though our petsitter might).

Don’t Waste Money On Things You Don’t Need

Money well spent is not money wasted.

When you buy something you need, for example, it’s not a waste of money. Your rent? Not a waste of cash (unless you’re living way beyond your means). Bus fare? Basic groceries? Not a waste of dough, not at all.

Money is only wasted when what you’re buying is a waste.

Money is meant to buy things you want and things you need, and when spent responsibly, it can easily do both these things. Something you want, however, needs to actually be something you want for this to work! If you ever regret a purchase, you can safely consider it a waste of money.

The membership for the gym you never go to? A waste. Those extra cable channels? A waste. The extra, two-shot, double pump, half-soy super tall frappe you buy every day? Yeah, a waste (plus really bad for you).

The key to living within your means is to evaluate the things that you want. Not impulse buys necessarily, but the things that actually bring you joy, because there is no shame in spending money on things you actually want. That’s why your money is there! My upcoming trip, for example, is one of the bigger items I’ve bought in some time — it’s a decent chunk of my gross income, but it is going to be so worth it. I know I won’t have a single regret about it, which means that every penny is a penny well spent.

But that crap you bought off eBay and haven’t looked at since? A waste o’ dough. The mass collection of make-up you never touch? Waste. All those brand-new hardcover books you buy but never read (they look great on the shelf, though) — you’re practically throwing money away.

To get your spending in check, you first need to analyze your cashflow — see how much money you make and how much you spend — before going any further. That’s when you can start to whittle down the crap you don’t need or want.

There’s a trick that’s known as the “ten-second rule” when you’re evaluating a purchase. Before buying something, look at it for a full ten seconds and consider it. Ask yourself the two questions:

  1. Do I need this?; and
  2. Do I want this?

If after ten seconds you answer “no” both times, put it down. I usually stop after the “need” question, and often turn the ten-second rule into the thirty-second rule. If after thirty seconds of contemplation, I don’t want whatever I’m holding, back on the shelf it goes.

The ten/twenty/thirty-second rule is an awesome tool if you’re trying to save money, and can actually make window shopping actually painless.

Of course, if you truly, truly want something that’s completely unnecessary all the time, you may need to adjust your shopping habits and stay away from triggers because you can’t always get what you want. Budgeting does mean, sometimes, denying yourself the things you want for the things you need.

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