Rules for Buying a Car for All Cash

An automobile is a major purchase and the consumer purchase most likely to throw a major kink into your fragile financial situation. But it doesn’t have to be that way. What’s required is a little radical thinking and forethought.

Here are the three rules to follow when buying a car:

RULE 1. Pay cash. Hang on. I know you may not be able to do that right now. Just be patient and I will teach you how. This principle is so important that I will repeat it: Pay cash for your car.

RULE 2. Opt for a late model. Make sure you are not the first owner. Let someone else take that 20 percent depreciation hit. Your goal is to drive the best late-model, previously owned car you can afford paid for with the cash you have.

RULE 3. Always make payments. I hope that got your attention! On the one hand, I just told you always to pay cash for your cars. And now I am telling you always to make payments. Both principles are true. You must adopt the attitude that as long as you intend to own a car you must cover the the cost by making monthly payments to yourself ahead of time—in anticipation of your next car. This way you are always earning interest (because you hold that money in a savings account), not paying it.

Even if your current car is doing well I can promise you that car will not last forever. That’s why I want to challenge you to start today so you can pay cash for your next car. 

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Beyond Laundry: 10 Ways to Use Washing Soda Around the House

It looks and feels for all the world like laundry detergent. White. Coarse. Powdery.

A mineral mined from dry lake bottoms and extracted from the ashes of vegetation from the Middle East, kelp from Scotland and seaweed from Spain, it’s used to make glass, bricks, paper, rayon and toothpaste. It cleans silver and softens water.

Its real name is sodium carbonate, but this stuff also goes by soda ash, Na2CO3 and good old Arm and Hammer Super Washing Soda.

Washing soda and I go way back. Since first married (47 years, yay us)  I have added washing soda to the wash for cleaner, whiter, brighter laundry. More recently it has become one of the ingredients in our homemade laundry detergent.

Best of all, washing soda (aka sodium carbonate) is cheap. Depending on the source, expect to pay around $.10 per ounce.

As of late, I am discovering that washing soda is much more than a laundry detergent booster. With a powerful pH of 11, washing soda acts as a solvent all around the house, garage. Sodium carbonate removes dirt, grime, greasy build-up and a range of stains.

STOVE TOP, OVEN. Remove the burners. Sprinkle dry washing soda dry on a damp sponge and scrub that stove top, broiler pan and oven making sure to avoid the heating element. Soak the burners in a solution of 1/2 cup washing soda dissolved in a gallon of warm water for at least an hour. This will soften and break down all of the greasy gunk and grime. Scrub as needed, rinse well and dry.

COOKWARE, POTS, PANS. To remove greasy, burned-on stains from cookware (do not use on aluminum cookware), fill the pot with hot water. Add a spoonful washing soda and a squirt of splash dishwashing liquid. Bring to the boil over high heat then simmer for 15 minutes. Do not use on aluminum cookware.

COFFEE POTS, CUPS, CARAFES. Coffee and tea often leave ugly brown stains in kettles, pots and cups. Fill the stained item with hot water and add some washing soda. Allow to sit for at least and hour or even overnight. Stains easily rinsed away in the morning.

PLASTIC. Clean and freshen garbage cans, tablecloths, shower curtains, patio furniture and anything plastic with 1/2 cup washing soda dissolved in 1 gallon warm water. Wash and rinse.

TOILETS. Use a cup of washing soda down the toilet to clean and freshen, and to help prevent blockages.

TILE, GROUT. Clean wall tiles with a regular solution (1/2 cup washing soda to 1 gallon warm water) clean tile and grout. You may need to scrub the grout with a stiff brush. You won’t believe the clean and sparkling results.

WINDSHIELD. A mild solution of washing soda will help remove dead flies, bugs and grime from windshields. Avoid splashing onto the car’s painted surface. Do not use on aluminum alloy wheels.

PEST CONTROL. Get rid of white fly and mites by spraying plants and trees with a mild solution of 1/2 cup washing soda to two gallons water.

STAINS ON CONCRETE, GARAGE FLOOR. Pour a generous amount of dry washing soda on spills and stains. Sprinkle lightly with water to create a thick paste. Allow to sit overnight. The following day, scrub with a stiff brush (re-wetting as needed). Hose down then wipe the surface clean.

TARNISHED SILVER. To removed tarnish from silver, line a non-reactive pan or bowl (glass, plastic) with aluminum foil. Fill with a solution of 1/2 cup washing soda to one gallon hot water. Add the tarnished silver pieces and allow to soak for 15 minutes. The tarnish will simply disappear. Rinse well then buff the silver pieces until they sparkle. Can also remove tarnish from silver plate, jewelry, gold, copper, bronze, stainless steel and most brass following manufacturer’s guidelines.

Look for Arm and Hammer Super Washing Soda in the laundry aisle of some supermarkets, discount stores and online (about $.11 per ounce with prime shipping). Generally, a 55 ounce box runs about $5 in the store. When the price is right, I buy it online as soda ash. Remember that both Arm and Hammer Super Washing Soda and soda ash are 100% sodium carbonate—exactly the same.

CAUTION: While washing soda doesn’t give off harmful fumes, you do need to wear gloves because it can cause skin irritation. DO NOT use sodium carbonate (aka washing soda, soda ash) on aluminum, fiberglass, leather, silk, wool, no-wax floors or treated wood surfaces.


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Parents’ Financial Decisions and Their Adult Children

Parents of adult children may believe it’s none of their kids’ business how they handle their finances and what they do with their money.

While that may be true, never forget that every financial decision you make has the potential one day to become either a burden or a blessing for your family.

Dear Mary: One of our friends suggested that we look into a plan called “Life Estate,” which would make sure that our home goes to our children no matter what.

We own our home and have no debt, but have no long-term care insurance either. Of course, we hope to stay well until we die, but in the event we would have to go to a nursing home and our monies run out, we understand this plan would preclude the nursing home from taking our home. Your thoughts? Tom and Jackie

Dear Tom and Jackie: I am not an attorney, but I do have experience as a real estate broker. Generally, I can tell you that “life estate” is a term used to designate the way legal ownership or title is held on real property.

To do this, you would deed your property to your children, who become the “remaindermen,” while you become the “life tenants.”

As the life tenants, you retain possession of the property including full costs of maintaining the property. The life tenants cannot sell the property without the consent of the remaindermen. Further, your children would receive full ownership (fee simple) immediately upon the death of the last life tenant, without the property going through probate.

There are advantages and also a few disadvantages for you to convey your property now to a life estate that you need to fully understand before making a decision. I suggest that you meet with a qualified real estate attorney.

If you decide to deed your property to a life estate it should be as simple as completing forms and having them properly recorded in the county where the property is located.

Dear Mary: I have been reading your books, newsletters and this daily column for years. You have really helped me a lot. Thanks! I have passed along everything that I could to my parents, but evidently they haven’t read a thing.

A year ago, my brother bailed our parents out from foreclosure and they are still so far in debt they can’t see even a glimmer of light.

Now they want to come for a visit and I want to tell them not to come because I know they can’t afford it. If you ask them if they can afford it they will laugh and tell you they can’t afford anything, but that doesn’t change anything. They have nothing in savings, and spend money (credit cards) like they have all the money in the world, trying to keep up appearances.

Should I tell them that they can’t come visit until they get back on their feet again, or just let them come and continue to flounder and get more in debt than they already are? I’ve been able to put them off for a couple of months, but I don’t know how much longer I can. I feel like I’m caught between a rock and a hard place. Debbie

Dear Debbie: There is a reason I have NOT written a book, How to Manage Your Parents’ Money. That’s because you can’t control your parents or make any useful demands on them.

My advice is to back off. Call and invite them to come and visit at the earliest possible time. Do everything you can to make their visit enjoyable including not talking to them about their financial situation. Let the way you live and manage your finances speak louder than anything you can say.

Should they die broke leaving all kinds of debt, you will not be liable for any of it, provided you have not added your name to any of their accounts.

Please, just love them and allow them to have a warm and loving relationship with you despite your differences.

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8 Ways to Build a Cash Stash

Saving money is a curious term with two meanings: 1) To spend less, as in “I buy things on sale to save money” and 2) To physically place money where it is safe from being spent.

Okay, that’s fine. But here’s the problem. It’s easy to trick yourself into thinking that 1) and 2) are the same. They are not, unless of course you stop by the bank to deposit the difference between what you would have spent had the item not been on sale into your savings. That would be a clever way to boost your cash stash this year and at the same time adjust your mindset on what it really means to “saving money.” Here are eight more:

TAX YOURSELF. Determine right now that you will assess yourself a specific “tax” each time you make an ATM withdrawal. It might be $5 or $10, you decide. Whatever the amount, make sure you become a tough tax collector. No slacking, no IOUs.

IMPOSE A MORATORIUM. Select a specific denomination of currency, like the $1 or $5 bill that you will no longer spend, but save instead. Forbid yourself, and get very strict. Why not go with the $5? Your stash will grow so much faster if you absolutely refuse to spend any Abe Lincolns.

HOARD COUPON SAVINGS. Starting today, here’s the plan: When you grocery shop, ask the clerk to total your order and then pay for it. Then hand her the coupons and watch your total plummet. Since you’ve already paid, the clerk should hand back the cash equal to your coupon savings. If available, open a savings account at the bank branch located in the super-market. It’s easy to stop on your way out to make a savings deposit—even if it’s small. It all adds up.

RACK UP REBATES. They’re coming back in a big way as retailers want to make their products appear cheaper without actually reducing the price. They offer a rebate, knowing full well only a small percentage of consumers who buy the item will ever carry through. No matter how small the rebate or complicated the process, promise you will not be among the lazy bunch. Apply for, follow up and then stash those rebates as they arrive!

DRINK WATER. Pay yourself a bonus, like a dollar or two each time you eat out and opt for water instead of a pricey beverage. Don’t be a slacker in your obligation to pay up. And remember, no IOUs allowed.

MAKE A SWITCH. Opt to exercise outdoors instead of paying a gym fee. Or, determine you’ll ride the subway instead of jumping into a cab. Identify a name brand you will leave on the shelf this year in favor of its store brand equivalent. Then stash what you would have spent.

GIVE IT UP. Pick one thing that you will sacrifice for a specific period of time, like the coming year. Just cut it out. Stash the amount you would have spent on whatever it is—regular manicures, French fries, gourmet coffee, cigarettes—into your savings container or account. You could always do your own manicures, swear off the junk food, or brew your own coffee. As for that smoking habit, just imagine all the dough for your stash if you give that up.

TRICK YOURSELF. Whenever you write a check or take an ATM withdrawal, record the amount rounded up, to say the next dollar in your checkbook registry. Then deduct that amount from the balance. At the end of the month, reconcile and stash the “oops!” overage.

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Look What I Got For Christmas!

I love gadgets and apparently I’ve not kept that a secret from my friends and family. I’m still excited about these five new gadgets I got for Christmas—each one amazing and fun to use.

THE KNIT KIT. What a cool little gadget. It contains the nine essential knitting tools every knitter needs to have handy at all times—all of them excellent quality and cleverly tucked into this handy gadget. No more having to dig and search for a stitch counter, tape measure, crochet hook, yarn/thread cutter, stitch markers, point protectors, darning needle, needle gauge and collapsible scissors. All nine essentials are in there and part of The Knit Kit. What a brilliant and clever gadget. I love it so much I just can’t stop knitting. About $30.

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Tap Water: Good for Your Health and Your Wealth

It’s difficult to pinpoint exactly when it happened, but sometime over the past decade or so, the general population of this country formed a belief that bottled water is better than tap water—safer and healthier, too.

It’s possible that the trend started in 1976 when the chic French sparkling water, Perrier, was introduced to the world. There it was elegantly bottled in its emerald green glass in an era of glitz and excess. Who could resist? What could be more blatant than to package, sell and consume what most of us in the western world consider a basic human right easily supplied through the convenience of a home faucet?

It is pretty ingenious how the bottled water industry has convinced millions of people to pay between 240 and 10,000 times more to purchase water in a bottle than to get it from the supply we’re already paying for that comes out of the taps in our homes!

TAP WATER IS CHEAPER

These days a 16-ounce bottle of “spring” water goes for about a dollar, which works out to about $8.00 a gallon—twice the cost of milk, and about par with bottled soft drinks. Home delivery of water in those great big, heavy bottles is less per gallon but still around $40 a month, according to online averages.

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Why You Need an Emergency Fund and How to Get One

Last year, Mitch and Jenn had a string of bad luck. Mitch broke his leg in a skiing accident, Jenn’s car broke down requiring major repairs and their home’s aged roof decided to fail right in the midst of a major storm.

The timing for all of this wasn’t ideal—four weeks before Christmas. The financial and emotional toll of these events continues to be huge, but nothing like it might have been if they hadn’t been diligently building their Contingency Fund—more commonly known as an emergency fund.

Mitch’s health insurance is covering most of the costs of his surgery and follow-up therapy. Still they’ve had to come up with more than $2,400 to cover his deductible, co-pays and prescriptions. The car repairs were just shy of $2,700—not surprising given their Subaru’s age and 140,000 miles.

It was the roof that really threw them for a loop. The estimate to repair it—with no assurance that said repairs would last for longer than a few months—was $750, with a new roof coming in at $12,000.

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Gadgets to Keep You Powered Up

It’s hard to imagine how we’d live our lives without all of the electronic devices we’ve come to depend upon. I’m talking about everything from mobile phones to portable computers, tablets, MP3 players, fitness and GPS trackers; eReaders, too.

It’s not just an adult thing. My young grandsons have their own bevy of electronics that need to be powered including  LeapFrog LeapPad, LeapFrog LeapBand, and Kindle Fire Kids Edition (amazing learning devices, by the way).

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The challenge is more than staying powered while on the run. The trick is to keep electronic devices fully charged and ready to go. The more people in the household, the greater the challenge and greater potential for a big fat mess.

The best way to make sure you’re always powered up and ready to go it to make charging convenient. Not necessarily expensive, but well-thought-out.

Today, I thought I’d give you a quick tour of the charging tools I depend on and wouldn’t want to be without.

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