Meta Post : 5 great comments

Posted by Tad Johnson - May 5th, 2008 at 20:05

I’ve been impressed by the quality of comments lately. In case you missed them, here are five comments and my response. 

1) In response to backing up your finances, Presh wrote :

“I would add one more suggestion for younger people: talk to your parents about their financial information and ask if they have all their financial information backed up. We don’t like to think about it, but we might need to help them in a medical or physical emergency”

This is a great point to add and an important consideration. Chances are, you have parents. Have you talked to them about their finances? It may be an uncomfortable conversation, but it’s important none the less. 

2) On the subject of real estate, and the falling suburb house prices, jrandom42 added this: 

 ”Notice it said MOST. Not happening in the Puget Sound area. Prices are still sky high. There are radio commercials for places in the “mid 700s” as if those were really bargains. Even an hour and a half away from Seattle, prices are still in the mid-300s.”

This is a really important point for anyone considering a real estate investment. The U.S. economy is continually shifting and picking the right area is crucial for any long term investment like a house. 30 years ago, Detroit seemed like a pretty great place. Today it’s a ghost town in some parts. Flint is even worse. Pick an area with a strong economy that is likely to remain strong throughout the coming energy shift.

3) Glen shared his personal experience with using cash : 

 ”I normally swipe my debit card for everything, only using cash for parking decks and restaurants that won’t take cards.

While I was in Europe earlier this year, however, I found that carrying Euros was far easier than hoping that a store would accept a card, and I was amazed at how much more conscious I was of what I was spending.

I’m normally a tightwad, so I rarely worry about going over my limit - with 150 Euros draped around my neck though, I could literally feel the impact of every three or four Euros spent (especially via coins).”

Going cash-only not only helps your everyday personal finances, it can really help while on vacation.

4) Quick hit–Eric suggested another credit card for gas rebates : 

 ”I’ll just add that the Discover Open Road Card includes 5% back on gas purchases as well as the above mentioned ‘Auto maintenance.’”

5)  Dan achieves the ultimate gas savings zen : 

 ”I think there is one obvious tip for saving money on gas … take fewer trips. I think our culture is too comfortable with this on-demand lifestyle. In the old days, people would keep a grocery list and then go shopping on the weekend to stock up for the week to come. Now we are constantly making trips to the super market or over to pick this up or run that errand. I think we could all save some gas and some stress if we slowed down, planned, made lists, and stocked up.”

This is a great point that can be said often enough. We need to rethink our relationship with automobiles. If nothing else, $4 gas should teach us that we don’t need to drive for every errand or every outing. Most of the other 6 billion of our neighbors on Earth manage to live without cars. . . why can’t we?

 

Smart real estate investments

Posted by Tad Johnson - Apr 23rd, 2008 at 19:04

Thinking about buying your first home? Be careful where you buy. As we’ve already seen, future home price appreciation (and depreciation) will vary greatly depending on location. With gasoline prices rising and no relief in site, distance from the city center is becoming a crucial determinant for home prices.

For years, home size and features (like 1/4 acre yards) drove home prices. Suburban mansions popped up all over the country in cheap converted farmland. With an ever-expanding highway system and cheap gas, many thought this was a great deal.

Now that’s all changing. With environmental and economic factors pointing home buyers toward the city, suburbs are diminishing in value. But don’t take my word for it, read on below.

http://www.npr.org/templates/story/story.php?storyId=89803663

Home Prices Drop Most in Areas with Long Commute : NPR via kwout

The benefits of high gas prices

Posted by Tad Johnson - Apr 10th, 2008 at 17:04

As anyone who drives regularly is fully aware, gas prices are high. Quite high. Like $3.50 high. This may seem like a real drag when you’re paying $40 or $50 a tank, especially since prices move seemingly arbitrarily.

But as with most things, there is a silver lining!

cityplacedart2.jpgAfter dismantling our national mass transit system in the early 1900s and replacing it with sprawling suburbs and highways, this just may be the time to rebuild. (The reader may note that some of the largest cities in the U.S. have functional mass transit. I will remind the reader that every city of any size once had mass transit systems.)

The one-two punch of foreclosure fears and rising fuel prices will likely serve as strong encouragement for Americans to move back closer to the city centers at which point it becomes economical once again to build mass transit.

For this vicenarian, I can’t wait. What do you think?

The dollars and cents of saving energy

Posted by Tad Johnson - Mar 6th, 2008 at 21:03

The green movement is [finally] gaining traction in the U.S. Driven in part by $100 oil and climate change science, companies are actively marketing to a green conscious consumer. In turn, the consumer is starting to prefer products that require less energy. In a moment of sublime corporate cliche, this is a true “win win”.

Most of us pay between $0.12 and $0.15 per KWh (killowatt hour) of electricity. This is a somewhat abstract figure; let’s see how it relates to real life.

Above is a graph comparing standard incandescent and compact fluorescent (CFL) bulbs. You can see that the dollars and cents really start to add up; over a month a CFL bulb will save you over $4 in electricity costs. (In the interest of full disclosure, this is assuming the bulb is on 24 hours a day; hopefully this is not the case. Even so, you get the idea.)

green-basics-cfl-white.jpgThe savings above reflects the energy savings of one bulb. Chances are, you have at least 15 light bulbs in your apartment/condo/house that could be swapped for CFLs. Not only are you reducing the environmental impact by cutting energy usage, you’re saving money as well. Excellent!

Of course, the savings don’t stop there. Turning down the thermostat by a degree or two in the winter (and up in the summer) will yield more savings. Reducing your hot water usage will likewise save money in the cost of heating that water. It’s surprising how easily you can save money on energy costs with a minimal effort.

Not only will you be saving money, but you’ll feel good about yourself for doing your part to cut energy usage. Fantastic!

The cost of your commute

Posted by Tad Johnson - Feb 22nd, 2008 at 15:02

Where do you live? Where do you work? How do you travel between the two?

In many cities in the U.S., this feat of transportation is accomplished by the personal automobile. We call it a commute. The question is, what does it cost?

Assuming gasoline stays at or above $3 a gallon (which is highly likely) and assuming your car gets the average of 25 mpg, you’re paying $0.12 a mile. If you drive an SUV, you’re likely paying twice that. A hybrid might be half as much.

At this rates, a 10 mile commute costs $2.40 (round trip); a 20 mile commute runs you $4.80. Those of us unfortunate enough to drive 30 miles each way pay $7.20 every day. Over the course of a year, this would cost $600-1800. Just for gas. Ouch.

Then there’s auto maintenance, car payments, insurance, parking, etc. Driving to work every day turns out to be a pricey endeavor. As a vicenarian, you can do better.

carpool500.jpg

First, the easy stuff: take public transportation or carpool. Work from home one a week if you can. If you’re lucky enough to bike to work, take advantage. (You’d be surprised at how enjoyable a 10 mile bike ride can be.) When you do the math, you can save a good deal of cash just by modifying your transportation choices.

Now, the harder stuff: think about where you live. Our nation’s suburbs have lured many a homeowner with promises of cheap houses and huge yards. In most cities, you’ll pay more to live near the city center. Then again, you’ll pay less for transportation. In the ideal case, you could live in a city with good public transportation and give up a car altogether.a

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