Do You Have Tablet Envy?

16. January 2012 · 3 comments · Categories: Technology, Trends · Tags: , ,

Ever since Apple introduced the first iPad in early 2010, Americans have gone tablet-crazy.

According to the LA Times, 18 million tablets were sold in 2010. That number is expected to be 250% higher in 2011. Clearly, this is a trend that shows no signs of slowing down.

With their portability, decent battery life and endless apps, tablets are becoming the device of choice for the media-consuming masses. For those of us without one, tablet envy is starting to become very real. An interesting thought:

Chronic tablet envy notwithstanding, the good ones are still too darn expensive, and the not-so-good ones are, well, not so good. Given a little more time, I’m sure, there’ll be cheaper and better tablets available. But we’re not there yet.

By “the good ones,” he means the iPad. I agree that the $500 price tag of the iPad 2 is out of reach for a lot of people. But you have to consider what you’re getting for that price. The iPad’s two closest competitors, Barnes & Noble’s  Nook and Amazon’s Kindle Fire, cost less than half the iPad 2 price, but their lack of features and available apps are major downsides for a lot of people, myself included. Neither one has even come close to enjoying the level of success that the iPad has.

I admit that when tablets first came out, I was skeptical. I thought, “What could this thing do that I couldn’t do just as well with my smartphone or laptop?” As the months wore on though, I began to see people using their tablets in new and fun ways. In all sorts of settings. Some would sit on the couch and browse their favorite websites from their lap. Others would use it to stay updated with their friends on Facebook. Still others would watch a movie while laying in bed. It occured to me — these tablets are pretty cool. I began to picture myself sitting on the couch with a new tablet, playing Angry Birds or checking the latest sports scores.

The LA Times sums up the tablet craze pretty well:

They’re the perfect marriage of power and portability, enabling on-the-go access to books, magazines, newspapers, music, video and the Net, all in a slick, look-how-cool-I-am package.

Back in 2010, Apple introduced us to a product we didn’t know we needed. They convinced us to drop as much as $800 on an item that’s essentially a luxury. A luxury that might just be a laptop replacement and make the things we do everyday more enjoyable and accessible.

So yes, I have tablet envy. But i’ll wait until the next iPad comes out, and the iPad 2′s price is reduced a little, to make my move.

Photo by khawkins04

Join a Credit Union for Friendlier Service and Better Rates

13. January 2012 · Write a comment · Categories: Banking · Tags: , ,

I recently opened up a checking account at a credit union. Why did I do this? Because we’re no longer in an era where you can show up at any bank and open a free checking account. These days companies (banks included) are trying to squeeze every dollar they can out of us. Bank of America demonstrated this when they recently announced a $5 monthly fee for using their debit card, only to retract after customer outrage.

Credit unions are similar to banks in that they offer checking and savings accounts, loans of all types, and often credit cards. But the key difference is that credit unions are owned and run by their members, while banks are not. When you open up any type of account or loan, you automatically become a member. You “own” a small piece of that credit union. Theoretically, credit unions exist only as a benefit to their members. For this reason, borrowers and savers alike will often find the best interest rates at credit unions.

At most credit unions there are certain qualifications you have to meet to be able to join. For example, you might have to live in a certain geographic area, work at a certain place, or have someone in your family who’s a member.

While credit unions are in business solely to benefit their members, they differ in both size and scope. I actually belong to two different credit unions — one small and one large. The small one is a county-wide entity with 4 or 5 branches spread out across the county. It’s here that I have my car loan. The larger one is state-wide, with branches all over the state. Because I have my checking account here, fee-free access to ATMs is important. Not only do they have their own network of ATMs across the state, but you can also find one at certain gas stations.

Credit unions also differ in scope. Some only offer a few basic services such as loans and checking accounts, while others also offer insurance and retirement planning, among other things. You might even find discount tickets or free workshops. I once attended a workshop on mortgage basics geared towards first-time home buyers.

One thing I like about credit unions is that the atmosphere is often friendlier than what you’d get at a cold, impersonal bank. Because credit unions are owned by their members and aren’t required to act in the interests of shareholders (as are banks), they’re able to make choices that benefit the customer.

I have a story which illustrates the superior customer service you can expect at the majority of credit unions. A few months back I was in the process of switching to a new bank, and I was setting up the bill-pay feature at my new bank to automatically send payment for each of my bills every month. I must have entered in the wrong amount for my car payment, because the following month I got a call from the credit union saying that my payment was one cent short. They called me about one cent! Instead of charging me a fee as the big banks would for a late payment, they did the right thing and called to report it to me before the due date.

Before joining a credit union, it’s important to consider your needs. Whether you’re looking for an auto loan, a CD (Certificate of Deposit) or something else, be sure to compare the rates of competing credit unions in your area. To find a credit union near you, use the Credit Union Locator at NCUA.gov.

Photo by RikkisRefugeOther

Are extended warranties worth it?

10. January 2012 · Write a comment · Categories: Financial Health · Tags: , ,

Say you’re standing at the checkout counter of an electronics store, and the cashier asks if you’d like to purchase an extended warranty on your new flat screen. Should you do it?

Retailers love to push extended warranties because they’re almost pure profit. Very few people who buy one actually end up using it, which makes it a great deal for the retailer.

TVs, computers and other electronics are among the most common items people buy extended warranties for. But the quality and reliability of electronics have improved steadily over the past decade. Failure rates for flat screen TVs, for example, are as low as 3% over the first 3 years of ownership. So essentially you have a 3% chance that your TV will fail during that time. It just doesn’t make sense to shell out extra money when the odds of your device needing repair or replacement are so low.

You also have to consider the cost of the warranty versus the replacement cost of the item. It’s common for an extended warranty to cost 10-15% of the item’s cost. Two years from now, your new TV won’t be worth nearly what it is now because of rapidly changing technology. If it does fail after the original manufacturer’s warranty expires, you’re better off using the money you saved from not buying the warranty towards a new TV.

Electronics isn’t the only category that offers extended warranties though. They’re are also sold alongside appliances, cars, furniture and even homes. Again, the chances of you benefiting from an extended warranty for these items is slim. Especially in the case of home warranties, companies find all sorts of excuses to get out of paying for a claim. They put a number of exclusions into the contract, so that only if your furnace breaks on the second Tuesday of June and it’s raining outside will they cover the cost of repair. (Silly example, I know, but hopefully it drives home the point.)

When it comes to extended warranties, in almost every case you’re better off building an emergency fund that’s large enough to cover unexpected repairs.

One final tip: Many items come with an original warranty of 1 year, or 3 years, or some other length of time. If you charge the item to a credit card, some credit card companies will automatically add an extra year onto the manufacturer’s warranty for free! Check with your credit card company to see if your card offers this benefit.

Listen to online music for free

07. January 2012 · Write a comment · Categories: Free, Technology · Tags: , ,

Listen up, music lovers: How do you get your music fix? Do you buy expensive CDs or online mp3s? Your love of tunes doesn’t have to cost you as much as you think. There are several ways to get your fix for free or cheap.

Sometimes you can’t get around buying a CD or a few individual songs. Listening to music in your car or on the iPod, for example, might require you to buy the occasional CD. But what if you’re at the computer the majority of the time? I’ve got some options that will save you big bucks.

My favorite, and the one I’ve been using for a few years now, is Pandora. Creating a station is easy. Enter in the name of your favorite artist or song. Then, Pandora will play artists or songs that are similar to the one you entered, including a mix of songs from that same artist. You’re able to give each song a “thumbs-up” or a “thumbs-down”. As you do this, Pandora will get to know your tastes better. I like this service because it helps me discover new artists, or new songs by artists I already like. You can listen to 40 hours a month for free (with occasional ads), or pay $36 a year for an unlimited, ad-free subscription.

Another option I’ve tried is Spotify, which started in Europe and came to the US just a few months ago. It has exploded in popularity and it’s easy to see why after just a few minutes of using it. To use this service, you have to download an app from their website. After creating an account you’re able to search for artists or songs and play them within the app. The sound quality is amazing — the best I’ve heard from an internet radio service. And their library is massive — to date I think they’ve had every song I have searched for. The big downside is that you only get 10 free hours a month with ads. You can pay $5 monthly to have unlimited ad-free access on your computer, or an additional $5 ($10 total) for access on your smartphone as well.

Grooveshark and Slacker are two other services I’ve heard good things about. I’ve used Grooveshark, which doesn’t require you to download anything, but the quality is spotty and it’s often harder to find songs you’re looking for. At times, they don’t have any songs from a particular artist. I don’t have any personal experience with Slacker.

Finally, there are sites like Iheartradio.com where you can listen to your favorite FM radio stations over the internet. You hear them exactly like you would were you in a car. If you can’t find your station there, you can Google it. Most radio stations let you listen to a live stream on their website.

All of the services I mentioned use ads to support their free models. So if you don’t mind the occasional 15-30 second ad, you should be able to find an option that works for you. I’ve only mentioned a few, but there are many more out there. Think about this — for the price of one CD, you could get two or three months of access to tens of thousands of songs from one of these services.

Photo by tim geers

Be mindful of your purchases

04. January 2012 · Write a comment · Categories: Financial Health

When you shop, do you give thought to each thing that goes into your cart? Or do you walk down the aisles, mindlessly filling your cart with things you probably don’t need?

I’ve found that putting significant thought into each thing I buy helps me in a lot of ways. For one, it saves me money. Say I’m shopping at a department store and see a package of black socks that I like. I could, without thought, add them to my cart and be out about 10 dollars. Or, I could think about how many pairs of black socks I already have, what condition they’re in, and whether or not I actually need black socks right now. Could that $10 be put to better use?

Thinking before I buy helps me reduce clutter around the house. In Your Money or Your Life, one of my favorite personal finance books, Joe Dominguez and Vicki Robin came up with the term “gazingus pins” to describe the stuff we buy and don’t use. They argue that we’re basically robots walking around the mall, picking up gazingus pins and adding them to the gazingus pin drawer at home, never actually using the item or giving it thought again. I have enough gazingus pins laying around the house already — why would I want to waste my money buying more?

Putting thought into what I buy helps me prioritize my spending and reach my goals faster. Each month I make a list of the things I plan to buy that month or in the months ahead. Some examples of things on this list include running shoes, a waterproof jacket and new towels. I keep it updated regularly. No matter how big or small the item, this list helps me prioritize my needs and wants. It puts my spending in line with my goals. Then, when I’m tempted to buy something at the mall, I think back to this list and avoid unnecessary spending.

In the longer term, I have goals such as buying a house and paying down debt. I also keep these goals in mind when I’m out shopping. Each time I avoid an impulse purchase, I have more money to put towards these goals. Every month, the money that I would have spent on unnecessary purchases goes straight towards one of these goals. As my debts decrease and my savings increase, my motivation to avoid further unnecessary spending increases. This cycle of reducing spending, getting closer to goals, increased motivation has helped me more times than I can count.

Being mindful of your purchases is a great way to control your spending and reach your goals faster than you thought possible.

Photo by eldh

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