Don’t Feed the Alligators

A Personal Finance Blog from a Small-Scale Landlord’s Perspective

Archive for the 'Food' Category

Shaw's Cards

photo figure credit: ScrapperMom

This past Sunday morning ScrapperMom was perusing the grocery store circular when this offer caught her eye (my emphasis added):

Choose your tax refund reward. Customers can purchase gift cards with their Shaw’s Rewards Card (for carded markets) at their local store’s Customer Service center.  No tax form or refund check is necessary.  Customers may purchase a grocery store gift card at $250 or $300.  Each gift card will be loaded with an additional $20 for a $250 purchase or $30 for a $300 purchase.  There is no limit for the amount of cards a customer can purchase. The additional bonus amount cannot be used for the purchase of alcohol, fuel, tobacco, lottery tickets, dairy products, prescription drugs or additional gift cards.  Offer is available March 13, 2009 through April 15, 2009.

Shaw’s is one of our local grocery stores (same company as Star Market), and it ran a similar 10% bonus during last year’s Economic Stimulus check mailings.  Apparently the response from customers and reward for Shaw’s was so great that they’ve decided to run this offer during tax season this year as well.  The limit before was whatever the size of your stimulus check was, and we took full advantage.  But I’m really psyched that there’s no limit on this offer.

Clearly this is a great deal no matter how you slice it.  The offer is for a store that we visit at least once per week, where we spend at least $250 per month, and that sells necessities, namely food.  The only real question is how much advantage we can take.  There are a few factors that limit how many of these cards we should buy:

  • How much cash we have available.
  • What the cost is to tie up this cash for whatever time it will take to use up all of the cards that we buy.
  • Whether this is really a no limit offer.

Because we don’t live paycheck to paycheck, we actually have somewhere between $10,000 and $15,000 available on hand in cash that we could use for this “investment” that is not technically part of our emergency fund.  It turns out that we also gave the government too big of an interest free loan last year, so we’re going to be getting a healthy refund which we can also roll into purchasing discount gift cards.

I ran some quick math to see how soon I would have to spend the gift card before we would have just been better off sticking the money in a CD.  I figured out that if I could earn 3.5%, tax free,  on a $300 investment today, it would take 34 months to earn 10% on the initial investment.  That means that as long as I can spend the gift card within the next 3 years (because with taxes it will take longer than 34 months to accrue 10%) I will be getting a better return by buying the gift card.

I asked myself if there were any down sides to this offer as well.  One that pops to mind is that we’ll be tying up lots of cash that we may need for other things.  The nice thing about these gift cards, however, is that we can easily trade them for cash, and if things ever get that bad, we’ll still have to eat, so having grocery cards is not such a bad thing.  Another thing we’ll need to be careful about is where and how we store the cards.  Having the equivalent of thousands of dollars in cash laying around has risks: fire, theft, loss, etc.  We’ll have to figure out a way to deal with that.  Lastly, what if the store goes out of business?  This is certainly something about which to be concerned, but this is a chain that has been around as long as I can remember, stores don’t usually just all of a sudden stop honoring gift cards, and as above we should be able to liquidate them quickly if it comes to that.

We still haven’t decided exactly how many of these cards we’ll buy in total.  We spent about $5,400 on groceries in 2008, so we can buy a lot of these cards and still come out ahead.  Yesterday ScrapperMom went to the Customer Service desk to buy 6 of them and was told that you can only buy 5 per customer per day.  So there is, apparently, a limit, but I still don’t think it should affect how many we want to buy (though if it did I would argue that the ad does say “no limit”).

What do you think?  Should we stock up on $10,000 worth of these cards (or the closest multiple of $300) and get an instant $1,000 back?  Is this a deal that interests you?  How many will you buy or would you buy if you could?  Are there downsides or risks that we’ve yet to consider? Leave a comment below!

If you liked this article, you may be interested in seeing some related articles:


Killington

Creative Commons License photo figure credit: Derek Purdy

This past Friday I used some comp time at work to take advantage of some non-weekend skiing at Killington Mountain in Vermont.  My host for the day was an old friend who sold a company during the Dot-Com boom and has been, for the most part, living off of the interest and dividends provided by his investment of the proceeds of the sale.  We talked about a lot of things while riding the ski lift, from parenting philosophy to Wall Street bailouts to the whereabouts of our mutual friends.

My friend challenged me in many ways, not the least of which was in trying to keep up with him on the slopes.  But as the memories of freshly groomed courderoy fade away, I’ve been chewing on a number of the things I learned or relearned in our ski lift discussions.  Please excuse the fact that some of these are broad, and some are narrow, but that’s how the conversation went.

  1. Citigroup is not going back to $45 - Throughout most of the 2000s, Citigroup’s stock price was in the $40 to $50 range.  It closed at $1.03 on Friday.  There are two important lessons here: A. You should not own individual stocks unless you own enough and varied stock to be able to weather problems in one particular market segment, like banking or energy — in other words you should be diversified enough to mitigate non-systemic losses.  B. Even if you believe that the market will bounce back, it will have to do so without Citigroup, GM, and any number of other well established, large companies whose stock is now all but worthless.  Money invested in Citi at $45 is gone.
  2. Koreans make bad pilots – There’s a book out now by Malcolm Gladwell called Outliers.  In it, there is a story about the problems that Korea Air had keeping their planes in the sky in the 80s and 90s.  Apparently the problem stemmed from a cultural requirement for co-pilots and other crew members to respect their elders by not questioning their authority and decisions in the cockpit.  It seems to me that a lot of the financial mess we’re in today stems from people not asking enough questions when they didn’t understand the terms of a deal, be it a mortgage or a credit default swap.
  3. This is not the first time the government has bailed out a “too big to fail” company – Do you remember a company called Long-Term Capital Management?  I didn’t either.  But I learned that this was a hedge fund that failed “spectacularly” in 1998 and was bailed out by a consortium of banks.  This fund was “too big to fail” in that its quick liquidation would have led to a collapse of financial markets.  You can’t sell large stock positions all at once since it causes the price to fall sharply, and you certainly can’t do so for many stocks all at once since it causes entire markets to fall sharply.  My ski buddy wonders why we put ourselves into a position again in which unregulated entities were allowed to become too big to fail.
  4. When you can’t find value in something that you need, you can always go for cheap – I was eyeing the sushi bar at lunch time, but a $15+ dollar lunch was not worth it to me.  Instead I went with a $4 hot dog.  This is similar to why I choose index funds instead of managed mutual funds.
  5. Giving up a little can be worth a lot – A season pass at Killington cost $999.  A season pass with 14 blackout days costs $650.  By giving up less than 10% of the available days during the ski season — which also happen to be the days with the longest lift lines — you save 35% on the pass.  This works the opposite way as well.  I’m reminded of the fact that most of the gains in the stock market happen on VERY few days.  If you had invested $10,000 in 1996 in an S&P 500 Index Fund, you’d have $17,280 in 2008.  If you had missed the 10 best days during that period, you would have just $10,748.  If you had missed the 20 best days, you’d have lost money and be left with just $7,360.  (Source)
  6. The government should not have let Lehman Brothers fail – It was distasteful to the American people that the government bailed out Bear Sterns, so it let Lehman Brothers fail to appease the taxpayer rather than do what was right with respect to fiscal policy.  In all likelyhood this has cost the taxpayers far more than it would have otherwise in the form of bailout after bailout.  The failure of Lehman Brothers began a downward spiral which seemingly has not yet found it’s floor.
  7. Don’t take the experts at their word without doing your due diligence – The weather.com “ski index” for Killington on Friday was a 1 out of 10, with 1 being the worst.  I decided to make the 3+ hour drive and see for myself.  At the very worst case it would be a long way to go for a couple of beers.  My friend says that he would have given the day a 4.5 overall (5 in the morning, 4 in the afternoon).  I would give it a 7, since my bias is towards smaller, less challenging mountains with generally worse conditions.  Check out this clip from The Daily Show which features a great quote from Jon Stewart: “If I’d only followed CNBC’s advice I’d have a million dollars today…provided I’d started with $100 million.” (Thanks to David at My Two Dollars for posting the link earlier this week.)

I had a great time skiing, and a great time chatting on Friday.  I like to think they were both somehow good for my soul.  I like to hear your opinion on any of these points.  Leave a Comment below.

Little Feet

photo figure credit: MITBeta

As I exclaimed here, Daughter #2 was born at home last weekend.  This was a joyous experience for everyone involved, from ScrapperMom herself, to the doting midwives, to ScrapperMom’s parents, to me.  We’ve learned a number of lessons that we will take to heart the next time we have a baby.  Some of these involve the homebirth itself, some relate to parenting in general, some are financial and others aren’t. With that, this post will have its off topic points, but should contain enough finance related bits to keep everyone else interested.

ScrapperMom and I decided early in the pregnancy of Daughter #2 that she would try to give birth at home.  (Please let me know in the comments if you would like to know why we made this decision, and if there’s enough interest I will try to put together a concise, coherent post on the topic.)  Daughter #2 arrived about 9 days earlier than she was expected. Which leads me to lesson 1:

  •  Babies can come at any time. So be prepared.

A number of the problems that we have encountered in the first week of our daughter’s life can be directly attributed to lack of preparedness.

Example 1: ScrapperMom has been cooking extra food at nearly every meal she has prepared in the last month and freezing the extra.  This has left us with a freezer full of food that will help us eat well, frugally, and without much preparation time in the coming weeks.  The problem is that it takes several hours or days to thaw something out to eat.  So during her labor and following the birth, we kept running to the take-out menus to figure out where our next meal was going to come from.  Over $70 was spent, to feed all of the people here, on take-out food on the day our daughter was born.   (Thanks to my parents and in-laws for covering much of this cost.)  My mother-in-law hit upon a great idea the next day when she went out and bought a couple of pounds of cold cuts, rolls, chips, etc. — enough to last a few days and satisfy a number of mouths that came through the house during that time

Example 2: The car seat was not in the car yet.  In my scramble to put the seat in the car before we had to take the baby to the pediatrician’s office, I could not find a metal bracket that was required for the installation.  We have two bases for the car seat, and each has a place to store the missing bracket.  We need the bracket for only one of our cars, yet both of them were missing.  I considered running to Toys R Us to buy a new base for $25.  I figured that I could take the bracket out of the new base until I found one of ours and then return the base for a refund.  This is, perhaps, not the most ethical way to do things, but it was pragmatic.  Eventually I found one of the brackets on the floor of the car that didn’t need it and I was able to install the seat.

Example 3: When giving our daughter her first bath, we could not find the scrubby brush that we used on Daughter #1 at that age.  Nor could we find an infant sized towel.  All of these things were in a closest that ScrapperMom had planned to go through and clean this week, before the baby was due.  Since baby came early, I found myself standing there holding a reasonably clean, wet, crying newborn who I eventually wrapped in a couple of receiving blankets to dry her.

This lesson can be extrapolated to many areas of our lives, especially personal finance. Are you prepared? Do you have an emergency fund? Life insurance? Disability insurance?

Lesson #2:

  • You have to look out for yourself first.

Over the days immediately following the birth, I found myself playing host to everyone from the midwives to family and friends. Because the birth was in our house, I went into host mode. I realized only after the fact that they were all there for us, not the other way around. When people were in our house, I neglected many of the things that I should have been doing: laundry, dishes, toddler naps, doggie care, etc. I should have been more careful about not letting guests interrupt what needed to get done, because this just bunched all of these chores into a shorter period of time later (and left us with a surly 2 year old). Better yet, I should have asked these people to help me get these things done so that I could make sure that we all got enough rest after a busy few days.

We must also look out for ourselves when it comes to personal finance. No one cares more about your money than you do. We must manage our own retirement accounts, we must fund retirement accounts before college funds, we must be responsible for our own finances because no one else is going to do it for us.

I have several more lessons that we have learned that I will share in another post soon. Do you have any experience with home births or comments or questions about ours? We’d like to hear about it in the Comments section below.

Hotel Pool

photo figure credit: ScrapperMom

Michelle asks:

"How was the vacation?"

In a word: Fantastic!  We got to meet the newest member of our extended family (on that side, anyway…) who is already one and half!  We got to catch up with family that we haven’t seen in over 2 years.  We got to know new wives, girlfriends, and old friends a lot better.  Thanks to all of them for taking the time out of their busy schedules, providing places to stay, cooking dinner, etc.  This picture is the pool at the hotel in Orlando, which the kids loved.

As a follow up to my original post on this topic, I thought I would offer a post-trip analysis on how we did financially. It’s important to note that while we put nearly everything below on our rewards credit card, it will all be paid off by the end of the month because we had already set aside the funding for this trip.

I’ll start with the area in which I feel we did the worst from a frugal perspective: Dining out.  In total we purchased 9 meals out and they totaled $378.  This breaks down to $42 per family-meal, or $17 per person per meal if we count dear daughter #1 as a half person who shared what we ate most of the time.  Given that we ate a total of 22 meals, 9 represents only 40%.  We easily could have converted a couple of dinners out into dinners at home, but then again, we were on vacation…  We did manage to convert a couple of these meals into lunches the next day since the portions were often too big! I should also point out that this total included drinks with meals as well, which as you know can get pretty expensive.  During one meal we paid close to $9 for an 8 ounce rum and coke!

Relating to dining, our grocery bill came in at $141.  As described in the initial article, we had a lot of opportunity to prepare meals, especially breakfasts and lunches.  If you put all of our food spending together, the per person per meal average comes down to $9.50.  The grocery bill includes a 12 pack of beer that we brought to a party, as well as a lot of bottled water that we wouldn’t normally buy at home, but the local water was terrible!

In the category of transportation, we got a great deal on airline tickets: we purchased 3 seats for $597 on JetBlue.  The in-flight entertainment, especially Animal Planet and the XM station for Radio Disney went a long way to keeping our 21 month old busy on the flight each way.  In total, we spent $378 (Yes, exactly the same as on dining out!) on the rental of a mini-van and the fuel we needed for a week.  We drove the van over 500 miles since we went down to Disney, and much of the time the van was nearly at capacity with 4 adults and 2 toddlers in car seats.

Our short jaunt to Disney cost us both on the ticket side and on lodging.  We somehow thought that we still had tickets that we could use at Disney, which would have given us “free” entry to the park.  Unfortunately this was not the case, and we ended up having to buy 2 adult, single day passes for a total of $160.  Yes, that hurt.  The Magic Kingdom is a great place, but honestly I think it’s looking a bit dated, and I’ve been to a number of better parks in recent years that cost a lot less than this.  But it’s the American Way to take your kids to Disney, right?  The lodging for one night was not bad at $90.  This was our share of the split on the condo that we shared with my cousin and his family.

We spent a total of $23 on items that didn’t fit into any of these other categories.  This included a Christmas ornament from Disney, and a couple of magazines at the airport.  We successfully resisted the urge to spend $17 on a fan-assisted squirt bottle in Disney on a 93 degree, scorching hot day.  We also avoiding having to purchase every cute stuffed animal that DD#1 got her hands on.

Last, and far from least, we spent $720 at the Dog Kennel.  As outlined in this article, our dogs are expensive.  It definitely hurts to have to budget 30% of every trip we take to kenneling the dogs, and it’s the first thing that pops into my head whenever we consider a trip.  We spent a few years trying to find the right mix of costs for kenneling.  In this business, the saying is true: You get what you pay for.  We were horrified upon retrieving our dogs from a budget kennel on one trip, and they didn’t want to come home when we tried to get them from a super-expensive kennel.  Eventually we found a “just right” kennel that treats them well — but not too well.  This is certainly an area that will factor into any future pet decisions.  It’s a good argument against having two pets.

In total, we spent $2487.  This is a lot less than ScrapperMom and I spent on a lavish Quebec trip a number of years ago, but more than we have spent on a vacation in some time.  Was it worth it?  It’s hard to put a price-tag on the experiences that we had.  If pressed, however, I would have to say that the cost was worth it since it meshes with our values: notice that we have only a couple of magazines and a Christmas ornament to show for this expenditure.  We don’t place a high value on “stuff”, but rather experiences and time spent with family and friends.  You can’t put a price on that.  This trip would have been a lot less fun if we just went to Florida by ourselves…

We’re already looking forward to a mini-vacation in November as we travel to New Jersey to celebrate a wedding!

Coupons

Creative Commons License photo figure credit: ninjapoodles

Hardcore couponers would probably accuse me of blasphemy for saying that couponing may be a waste of time but even Crystal of Biblical Womanhood and Money Saving Mom thinks it’s ok to take a break every once in awhile, see her post on it here.   As for me, I wasn’t raised by a hardcore couponer and have only recently discovered the benefits. Living with my mother-in-law for a year also helped spark my frugal side. I do feel there are a couple of problems that I have encountered over the past year or so with using coupons.

First off, MITBeta and I do not buy the newspaper. We have in the past, but found it piled up and was only good for starting the charcoal grill and filling our recycle bins. Nowadays we get all of our news online or through our local NPR affiliate WBUR.  Most of the time we are lucky enough to have our parents save the fliers from their papers, but when things get busy we may not see them for a week and then we both forget. Because of this I may end up missing a few of the sales that correspond to the current sales fliers. Another option is to stop at a coffee shop or the library on a Sunday evening and pick up a newspaper that may still have the sale fliers, but I usually don’t have time to do this, let alone remember that I can.  On occasion I have bought the paper, only to find that the filers were not included. That made me very mad, so I probably will not actually buy the paper again!

We also don’t tend to buy a lot of processed food, which makes up the bulk of the coupons in the sales fliers. I do like to take advantage of CVS’ing (see this post if you are unfamiliar with the term) and that usually does require the coupons. The nice thing is that if we do get fliers from our parents and they come a few weeks late it is usually ok for CVS since the CVS deals hardly ever line up with the current sales fliers. Also a lot of products that tend to go on sale at CVS may have coupons available to print online.

Since I started using coupons and making more frugal shopping choices in general, I feel that I do have a handle on the costs of items and try to save where I can with or without the coupons. This may mean buying in bulk if that is feasible, buying generic or waiting for the good sales.  It always means checking the unit costs in order to buy the cost effective size.  I also try to buy only seasonal produce and by menu planning I’m able to more fully utilize all the food I purchase without having food go to waste.

I’m not exactly sure how we are doing with our grocery budget, but I try to be cognizant of the total at the checkout, while at the same time choosing healthy options whenever possible. I have stopped by the local farmer’s market a few times this summer as well to pick up local produce.  I typically don’t spend over $100/week on groceries for our family of 2 + a toddler and in the past we have tried to have a $75/wk budget.  How about you? Are you a hard-core couponer or do you just try to shop wisely? What is your weekly grocery budget?