Save Money & Gas: High performance air filters

With gas prices on the rise, lots of sites are posting tips on getting better gas mileage. Bargaineering has tried to quantify some savings, Frugal Work at Home Mom has a really nice long list of suggestions from SavingAdvice and even automotive performance retailers are getting into the act.

All the lists seem to agree that a dirty air filter will lower your MPG. If you are thinking of changing your air filter, you should consider switching from disposable paper filters to a re-usable, washable air filter like those by K&N. The filtering is achieved through an oiled cotton gauze and as a result more air gets to your engine than with paper. This can lead to increased performance and less gas usage (and a little more zip in your car too).

That's dandy, but the extra bonus is that one high-performance K&N filter can last longer than your car. Clean and re-use it up to 25 times...and with typical street usage, clean it about every 50,000 miles and you will never have to buy another filter. In contrast, paper filters last about 10,000-15,000 miles and get tossed in a landfill. Ugh.

Of course a K&N filter costs more than a disposable paper filter. They are usually $45-$55 for the filter and about $10 for a cleaning kit (that you won't need until after about 50k miles) and paper filters usually run about $15. If you don't count the better mileage or treading a little more lightly on the earth you've still made your money back after about 40k miles of street driving.

I'm no expert so if you are interested, please do your own research. I'm just a happy customer and I'm comforted to know my air is flowing just fine and probably will be for another 6 years. Then I'll just have to clean it to get my MPG back up ;)

Browser Bling with Pimpzilla

Pimpzilla is a theme for the Firefox browser that includes leopard print, gold highlights and sparkly diamond rollovers. I am not the kind of girl who spends her extra cash on diamonds and gold so this is as close as I am ever gonna get. There is just something cheerfully optimistic about surfing personal finance sites with some sparkletastic bling. Best of all? It's tacky! No, wait...I mean it's free!

Don't have Firefox yet? What are you waiting for? Off-topic "Holla!" to MyMoneyBlog for not only posting about Costco, but admitting he bought a giant 7lb tub of cheese sauce...Que Bueno indeed!

USAA Checking Account...kinda sexy!

Upon further inspection of USAA's personal checking account it's looking even better. According to their brochure that is luring me to them with the promise of $50, here are the account features:

• No charge for first 10 ATM withdrawals ($1/ea for more than 10)
• Refund for up to $15 for ATM surcharges incurred each cycle (crispy!)
• 1/2% rebate on debit purchases made with Credit option (ugh, debit cards)
• Blue non-duplicate checks free for life of account
• Free Web BillPay

And they also pass my ultimate electronic accessibility test: they are compatible with Quicken 2005 for both OSX and Windows - Yes! (insert dorky arm pump here) This is not the place to detail my trials and tribs with Quicken, but my current bank "went dark" when they de-supported the QIF format. Between that and some other recent customer service dissatisfaction I have recently decided to look for a new place to park my checking account. USAA may be the place.

Receive up to $50 with USAA checking account

I've been intrigued by USAA's checking account since reading where Jonathan (and a reader of his ) parks his liquid cash. I had thought I was ineligible for an account, but maybe not. And now that I am considering a new checking account they were looking like a potential candidate. Now they are looking quite tasty since they will pay me to try them out.

It seems they are running a promotion which pays you $25 for opening a new USAA Checking account with direct deposit and an additional $25 to open and use their free web BillPay within 60 days. The offer expires April 29th and no special code is mentioned. They direct you to apply through their website or calling (800) 531-6617. The website forces you through an eligibility questionnaire so I will probably call.

We got the brochure because my partner has their mastercard (which now offers up to 1.25% back) so it is also unclear if this checking account promotion is tied to the Mastercard. It's worth checking into because it looks like a good checking account and you can't beat free money... but I'm gonna just cry if they don't support Quicken 2005.

TaxCut Rebate Status Link

Got notice from that my rebate form for my $14.95 e-file charge was received and that it will take 4-6 weeks more "to process" (*snort*). I sent that over three weeks ago so they must be still growing some trees so they can make some paper on which to print checks. And no word yet on receipt of my $24.95 State Taxcut rebate form. They just crack me up, but they have come through every other year...rebates are just slow.

Needless to say, I'll be obsessively checking my status more than any normal human should. Mama wants her $39.90!

Roth and Roll...an update

Today I called my credit card company that sent the 1.9% promo rate "superchecks" and there is indeed no transaction fee. I also confirmed that I can complete the "transfer" online and send the money directly into my checking account. This will earn me the $3 credit on my $3000 transfer...so my plan is working out (w00t!)

Interestingly just yesterday I got promo checks from another credit card of mine offering a 0% promo rate (neat!) but upon inspection charges a transaction fee of 3% with a max of $50 (booo!) so going for the low rate alone would have cost me serious money. Always read the fine print folks!

This evening I opened a new Roth at Fidelity using their online form which only took a few minutes. I chose to initially fund via a bank transfer (though I will also be transfering my other Roth over), so after my account was created, I filled out their form for adding that capability to my account. I was notified that in 7-10 days I will be able to transfer money directly from my bank into my Roth. Sweet.

Here's my plan:

• Initiate online "transfer" to bank by 3/31 (I plan on 3/26)
• Transfer from bank to Roth before 4/15
• Pay at least $1500 toward loan 4/16
• Pay off loan by 5/16

Goal: $10k in Emergency Fund by EOY 2005

Now that my credit card debt is basically gone, it's time I set some concrete savings goals. It's not sexy, but I really need to establish a safety net. The first step is to figure out how much I need in my emergency fund. Well, this is easier said than done because advice varies. Suze says eight months living expenses, then she says six elsewhere, and fools say three to six (it depends!) .

Well... I need a meetable goal, our expenses are $3k and I have a high risk tolerance (and no kids - just me, my gal pal and two cats...insert clichés here) so I decided to start with setting a goal of $10k by the end of the year.

This is my "emergency fund" only, I will be using my short term savings for a new washer (the current one gobbles water and eats our clothes), three trips to see family, some desperately needed small home improvements and building an emergency repair slush fund.

This is going to be a little tight because including the 2004 Roth contribution I need $13k...and I have $50.03 now with less than 10 months left. But it's no fun if it's easy.

$10k in 2005! Ready...Set...GO.

Budgeting: Can I stick to the 60% solution?

Sherlock Holmes may have preferred a seven-percent-solution, but that's not really my style. Ok, ok, that's narcotics...and literature and this is budgeting. True. I have always been a firm believer in budgets and yet completely flummoxed by implementing one. Until now.

Maybe it's the ADD, or the fact that I have tracked my expenses in Quicken (since 1998) down to a level of detail that would make your eyes cross, but I have never really been able to get a handle on what I *need* and how to use the rest to *save*. It has been TOO much information and I need to get up and running fast now that I am determined to turn this cash-boat around.

Cruising around the indispensible It's Your Money! site, I came across an MSN Money article that offers a simple budgeting technique. The author's plan is to keep "committed expenses" to 60% of gross income, use 10% for "fun" and save the remaining 30% across short and long term savings.

I tried his formula as is, but found that if I modified it a bit and based it on my net, the numbers were rounder and I was allocating more for savings and slightly less for "fun". Measured against my gross income, my taxes (payroll and property = committed) are 25% and my 401k (=long term saving) contribution is just under 15%. Here's how I applied the formula to what's left:

$3000 (60% committed expenses)
$1000 (20% long term savings)
$ 500 (10% short term savings)
$ 500 (10% fun)

Since I decided to borrow to make my 2004 Roth contribution, I'll be sinking both long and short term savings into paying that back for the next two months. After that, I'll be building my "emergency fund" and short term savings (irregular expenses, travel, christmas...) throughout the year. I'll be setting up an automatic transfer of the $1500 to my ING savings account starting next month so my checking account balance will reflect how well I am doing on my 70% limit on monthly spending.

I need to noodle more on what's committed, what's fun and what's "irregular" for me so I can fine tune this. It's ok to start, but I do feel I should be saving even more. I just don't know if this generous salary is going to last, so I'm trying to make the most of it.

Spruced up the site a bit

I decided to stop procrastinating and build out my sidebar a bit. I hope it's not too crowded over there. I desperately wanted a links section over there as a backup to my bloglines account. For some reason bloglines wasn't working for me since friday eve sometime until this morning and I felt cut off (was it just me? play a joke on the new kid? bloglines how you tease me so). This way if my feeds go poof, I can kick it old skool and stay in the loop.

I also began my requisite "chicklet" buildout with some syndication links and tweaked things under the hood to provide a single feed. My thanks to JLP of AllThingsFinancial for the encouragement to "burn my feed", among other things. My hope is that any sense of readership *at all* will keep me focused on my goals (mom? are you out there?). We'll see.

Now to get back to the posting the juicy bits...

Should I borrow to fund my 2004 Roth IRA

What am I to do when I feel "I must! I must! I must increase my Roth!" (my apologies to Judy Blume) but I don't have the cash to do it before April 15th? I consider the importance of making the contribution and I carefully weigh my options...

The Problem...A dinky Roth at my age!
About seven years ago, when they first came available, I opened a Roth IRA in the form of a $2000 CD with my bank. In Jan 2003 I moved it to a mutual fund, but I have not contributed to it since it's inception. Instead, I have focused solely on maximizing my 401(k) contributions each year. I reasoned I didn't have the "extra" money to put in a Roth, I wanted to minimize my taxes TODAY, and besides...my tax burden would be much lower in retirement.

I now know prioritizing minimizing my tax burden now may not be the best option for long-term and that it's best to "tax diversify" a retirement portfolio (using tax-deferred, tax-free and taxable accounts). It has become clear how important a Roth IRA is to meeting my retirement goals. I am 37 now, with a Roth IRA worth approximately $3000 - only 5% of my retirement portfolio - ACK!

I've wasted some valuable compounding time so I am feeling the pressure. I must make a 2004 contribution before April 15th. Using a conservative 8% avg return and a fantasy retirement date of 50, I calculated the following:

If I do not make a 2004 contribution, I start with my current $3000 balance and contribute $4000 annually until 2008. I contribute $5000 annually from 2008 forward for a total Roth balance of $116,664.00 in 2018.

If I make a 2004 contribution of $3000, I start with $6000 and making the same assumptions my Roth balance would be $124,823.00 in 2018.

That's not huge, due to the limited time involved, but that's over $5000 extra that I'd rather have! If I then leave that money untouched until I am 60 and can withdraw it without penalty, again assuming an 8% return, that difference nearly triples to over $14,500!

Aye, but the rub is that I have no cash savings with which to contribute...argh! I have paid off all my credit card debt as of last week and I am determined to begin saving 30% of my takehome pay beginning next month, but I only have $50.03 in my shiny new ING savings account.

The Solution...Borrow?
It being near tax time, the invitations to borrow are pouring in. At my new savings rate, I could have the $3000 by mid-May without a problem...but not by April 15th. Since I would only need to borrow for a short time I decided to look at my options:

1. Checks for our home equity line (HELOC) that have an APR of 5.875% (daily periodic finance charge of 0.0161%) and the interest is tax deductible. There is no transaction fee and I could start this loan as late as 4/14. If I pay it off by 5/15 it will cost me about $15 to borrow this way (roughly $11 considering the tax implications of a 25% marginal rate, right?). It is a variable rate, but for such a short term, I'm sticking with this calculation.


2. "Checks" from a credit card at a promotional APR of 1.99% (daily finance charge of 0.0052%). This is a fixed rate until July 31 and also appears to have no transaction fee. The offer expires at the end of the month, so I would have to start the loan on 3/31. If I pay this off by 5/15, it will cost me a little more than $7...less than half what the HELOC option costs. They will also credit me $1 for every $1000 "transferred" online instead of via the paper checks. If I can qualify for that credit (can I "transfer" to myself? My bank? Or only to another credit card account?) I break even on about day 18 and the loan will cost less than $5.

Conclusion...Good debt?
For under $8 I can make a serious investment in my future. I will also investigate whether I can use a .99% rate that I often get invitations to use (Oh Sony Card...come to my rescue!) and drop my cost to below $4. I might even be able to map out a plan using my ING account that would lessen or eradicate that cost altogether.

In addition to the small financial cost, I will also have to endure the disappointment of postponing credit card debt eradication for another 60+ days (Khaaaaaaan!), but the theoretical math doesn't lie (theoretically) so this seems like a wise choice nonetheless.

I got the OK from my better half and thumbs up from Pepper, so I'm going for it.

Tips for cleaning up my financial act

Gerri "5 Tips" Willis just finished publishing a three-parter on "cleaning up your financial act" and I plucked a few special nuggets out to noodle more on:

Part I: Cleaning up your credit
This, the first, installment was really about cleaning up your credit *report*. I am sure I need to do this, but I saw mine last summer when we refinanced. My FICO was pretty decent and the only thing "off" were the closed accounts that still show as open (are they artificially inflating my score?). Since I am not planning on applying for any loans this year, my plan is to do this in Sept/Oct...about a year after my last quick glance and when FACTA hits my area.

Part Two: Cleaning up your nest egg
5 tips on diversifying retirement savings. Two things stuck out at me...the first:

If you have more than ten years to retirement, you might try an allocation with 70 percent stocks and 30 percent

Am I nuts for doing 80/20 at age 37? Or is that just somewhat conservative advice? My financial mentor Pepper has even had to gently encourage me up to 20 with a little help from the Motley Fool "rule your retirement" allocation for "more than 10 years" to go. And the other nugget:

How do you know when to dump a fund? Platania says, "At the end of the second year, if you think a fund is an under-performer, compare it to its peer group." If other funds like yours performed far better, it's probably a good time to fold on that fund.

This seems like good advice...a "two year" review. I don't want to hold on too long to a dog, but I don't want to jump ship too early out of impatience either.

My 401(k) only had 12 funds to choose from....and most of them mediocre at best. So my allocation scheme is based on choosing the best my 401(k) has to offer, and diversifying the rest of my portfolio accordingly with my IRAs at Fidelity.

Part Three: Clean out your financial closet
This installment didn't have much for me personally since I'd never keep financial secrets, I don't borrow from my parents, and I don't have college funds to bogart. Frugalgirl found the insistence on saving for retirement during your younger years particularly relevant for her. But being a bit older, and having neglected my retirement accounts despite stuffing them with some decent cash, what was most relevant to me was the "Cobwebs in your portfolio" section. That is so me right now. I don't have stocks lying around to re-evaluate, but I hadn't really evaluated my current funds according to their peers. Once I did that, I realized I had over 30% of my entire portfolio in underperforming funds. Ouch.

Time to fast-track the rest of my retirement consolidation.

Am I "Financially on Track"?

Over at CNN's personal finance area the Armchair Millionaire has a quick quiz to find out if you are "financially on track" so I thought I'd see how I'm doing....

"Have you figured out what you need to retire?"
Sort of. I've just started calculations in earnest within the past 6 weeks and it's really opening my eyes. I'd say I have a rough idea, but since I'd like to retire early, I need to do some more calculations. Even the "ballpark estimate" calculator vexes me. Right now I'm aiming for $1million by 60, but that might translate into $1.5million by 50 (if that's even a doable goal for me). Knowing this number asap is a high priority for me.

"Do you save a portion of your income regularly?"
Not yet, not counting non-retirement. I have been regularly maxing my 401(k) contribution for about 10 years with the exception of my full year of unemployment. But I have a whole $50.03 in my spanking new ING savings account. This is changing as of this month. By next week, I will be socking away $1500/mo.

"Do you pay off your credit cards every month?"
As of now, that's the plan. The delicate time will be the next few months as I get some savings banked so I can handle unexpected large expenses. Fingers crossed.

"Are you protecting what you have?"
This question was about health, homeowner's and life insurance. I'm 2 for 3. My employer pays full health and dental, including domestic partner benefits. The homeowner's is set but could probably use a refresher. We did opt to pay it ourselves with our last refinance so that money's not sitting in escrow...it will be sitting at ING instead.

Well, it's pretty clear that I am not yet completely on track (one wheel on? one off?)...but I like to think I'm on my way. I still have some ground to cover, but that's why I'm here after all.

February Accomplishments

I don't yet have clear goals to measure against but I feel I made some good progress toward my fuzzy February goals of reducing credit card debt and consolidating my retirement savings. Here's a look back:

• Enlisted a "finance mentor" - my friend Pepper - to come over once a month
• Filed both my federal and state taxes electronically on 2/15
• Opened an ING savings account with a $25 bonus
• Opened a Fidelity Rollover IRA
• "Located" my missing 401(k) and initiated direct transfer to Fidelity
• Obtained online access to my current 401(k)
• Sent off TaxCut rebates ($24.95 for state, $15.95 for e-file)
• Cancelled Citibank BillManager ($4.95/mo)
• Upon receipt, immediately applied my tax refunds to my credit card balance (w00t!)

The net effect is that by the end of February, my credit card balance was in sight of being eradicated, I'm well on my way to actively managing my retirement savings, and I have my first savings account since I was little (those passbooks were so...fascinating)

March will be all about finishing my retirement consolidation, paying off my credit cards completely, and finally establishing some concrete meetable financial goals - both short and long term.

Where to Consolidate My IRAs?

Having several chunks of retirement funds scattered all over was making me crazy and unable to manage. My recent plan had been to consolidate all but the Roth into my current 401(k) plan so I could manage it as a single account (well two if you count the Roth). But as I have learned recently, it is far better to manage as much of my retirement money in an IRA as possible. The most important reason is that there are many more choices available to you in most IRAs. Another reason for me is that I am most comfortable using the web and technology to manage my finances (among other things)...and my 401(k) custodian's website is also severely lacking.

All this left me in pursuit of a new home for a new rollover IRA that could also serve as a home for my Roth. My criteria basically worked out to:

• Large choice of funds (and stocks and...more?)
• Great web interface (research + account mgmt)
• Good customer service
• Inexpensive
  

My short list came down to Vanguard, T Rowe Price and Fidelity. My finance mentor Pepper sent me this link to Smart Money's 2004 broker survey (for premium discount brokers) and I was able to finally decide on Fidelity. They're listed as somewhat expensive for a discount broker but on their site they make it clear they offer no-fee IRAs and they have many funds that do not require a transaction fee. They also have a great site that has vastly improved since I had a 401(k) held there and I really liked their site back then. And so far their customer service has been really pleasant and knowledgeable on the two times I needed something minor in the last two weeks.

I am not sure I'd keep my non-retirement investments at Fidelity though...next year as I start to accumulate some, I might take another look at Vanguard and T Rowe Price because I do love me some cheap!

Do you Yodlee?

I recently re-discovered Yodlee which is a site that consolidates all of your personal account data providing an aggregated view of your personal finances. I had signed up with them back in 2001 or so and have used their service off and on.

Their business appears to be based on providing this aggregation service to financial institutions (you can access a branded version of Yodlee at Chase and Citi for example) but you can register for their free OnCenter service directly. You add all the accounts you want to track (banks, credit cards, investments...) and login information.

Not every institution can exchange data with Yodlee, so they offer a "custom account" for which you can manually update balances periodically. And you would be surprised at what is available and what isn't...my small regional bank can exchange data directly with Yodlee, but even though there are a few versions of Scudder Investments that apparently work with Yodlee, I cannot directly access my 401(k) held there. Go figure.

What makes Yodlee a really useful service to me is the fact that I can aggregate ALL of our financial accounts in one place for a comprehensive view of our finances as a couple. I track my own accounts in Quicken, but LaLa's retirement savings are no longer a mystery to me and vice versa. It's all gathered in once view, accessible by either of us at any time.

"Money Mind" quiz...cheap marketing gimmick?

JP over at MyMoneyBlog mentions his experience with taking Checkfree's Money Mind quiz so I went to check it out. The tag line next to the "Take the quiz" button reads "Find out how to maximize your mind when it comes to managing your money" so I was expecting some value out of it and I pressed on. What I found was a poorly concocted quiz that is just a Checkfree marketing tool and offered me no value at all for my time but promised value if I ponied up my personal information so they could advertise to me.

Their are four "types" in the quiz and each of the four answers throughout the eleven questions is ordered in the same way each time to correspond with a type. The questions were overly simple - I was often torn between the first and second answers (controller and traditionalist respectively) as neither described me accurately and if you rent instead of own you are labeled at least 9.1% adventurer regardless of your age or housing market (as JP was).

My final tally was:

Controller 63.6%
Traditionalist 27.3%
Trendsetter 9.1%
Adventurer 0%

Which doesn't tell me anything about maximizing my mind, so I clicked on the button to find out more and was taken to a form that required personal information such as an address to move forward. Unlike JP, I didn't even *think* to put in junk...I was too irritated, but luckily he posted some of what he found beyond the form.

It didn't seem like JP was too impressed with the links offered but he did mention ThinkGlink and to me that's probably worth the time to take the quiz. We used articles by Ilyce Glink to provide content at my old job and her book on first time homebuying saved our butts three years ago when we took the plunge so I'm interested in checking out her other writings.