Sharon Marchisello's Blog, page 8
June 13, 2019
Reduce Summer Expenses
It's not even summer yet and many parts of the country have already experienced sweltering heat waves. Summer brings higher bills for electricity and water as we struggle to stay cool and keep our lawns alive.
Here are a few reminders to help reduce those expenses:
Don't keep your house so cold that you have to put on a sweater or curl up under a comforter. When the weather is hot, enjoy wearing shorts, sundresses, and sleeveless tops. For every degree you turn up the thermostat, you may save approximately 1% on your energy bill. If no one's home all day, turn it up even higher and program your system to start cooling a half hour before you arrive.
Speaking of air conditioning, don't forget those annual check-ups for your HVAC (heating, ventilation, and air conditioning) system. Filters may need changing and the technician can repair minor problems before they become major. Not only will you save money by having equipment that runs at top efficiency, you'll prevent potentially life-threatening situations, like poor air quality or even fire from years of dust build-up.
Fans are great for circulating the air around you, creating a breeze to make you feel cooler, but they do nothing to lower the temperature. Turn them off if no one's in the room; they just use up electricity.
If you have large windows or sliding glass doors that face the sun, keep the drapes or blinds closed during the hottest part of the day. Not only will your house stay cooler, but you'll prevent the upholstery from fading.
When you run your air conditioner, make sure all your doors and windows are closed, including those in rarely-used bedrooms and bathrooms. I can still hear my father yelling at me to shut the door if I held it open too long for the cat to make up her mind if she wanted in or out. "What are you trying to do, air condition the whole neighborhood?"
Lots of hot days without rain can wreak havoc on your lawn, so expect your water bill to rise if you want your grass to survive. But be careful about putting your sprinkler system on a timer. Unexpected rain showers may save you from having to water your vegetation. There's nothing sillier and more wasteful than seeing a neighbor's sprinklers going off when rain is pouring down.
Don't stock up as much on perishable food that doesn't need to be refrigerated. Vegetables like onions and potatoes that can spend weeks on the counter during the winter might start sprouting after only a few days in warm summer temperatures. Fruit will ripen faster, so plan accordingly to avoid waste. In the south, we have a problem with bugs, so some dry goods like flour and crackers have to be kept in the refrigerator after they're opened. Allow space for that if you face this dilemma.
What tips do you have for saving money on utilities in the summer? I'd love to hear your comments.
Sharon Marchisello is the author of Live Well, Grow Wealth.
May 17, 2019
Countdown to Financial Fitness: Appealing Your Property Taxes
Countdown to Financial Fitness: Appealing Your Property Taxes: We just received our property tax assessment and, like many of our neighbors, we're in shock. I'm reminded of a cartoon illustrati...
Appealing Your Property Taxes
We just received our property tax assessment and, like many of our neighbors, we're in shock. I'm reminded of a cartoon illustrating how a house is viewed through different eyes: You see your house as you know it. The real estate appraiser sees a dilapidated shack. The tax assessor sees a palace.
Our county tax assessor thinks we live in a palace.
I used to not pay much attention to the assessment statement, which arrives each spring. I didn't really know what my house was worth—or care that much—since I wasn't getting ready to put it on the market. The figure the tax assessor provided was merely informational.
The tax bill arrives in the fall, but by then it's too late to appeal. Property owners have 45 days from the date of the assessment to protest the valuation that will be used to calculate the tax bill.
About three years ago, when the real estate market started to recover, our property assessment shot way up. I finally paid attention, and then I found out it's not that hard to appeal. There are companies that charge to file an appeal on your behalf, but the process is simple enough to do yourself and save that fee.
In Georgia, you can print a one-page Appeal of Assessment form, found online at https://dor.georgia.gov/documents/pt-311a-appeal-assessment-form. Fill in your contact information; the rest of the data can be found on your property assessment form. Start with an appeal to the Board of Equalization, the box for which there is no charge.
Under "Property Owner Comments" I write "see attached." Then I prepare a one-page narrative about why my property is worth less than the assessment.
Start with a visit to an online real estate site like Zillow and type in your address. (It's creepy how much information they have about your house.) Zillow will give you a "zestimate" of what your home is worth, i.e., a suggested asking price if you were to list it for sale. If Zillow's estimate is less than what the tax assessor says your property is worth, include it in your narrative.
Then, most importantly, look at comparable sales in your zip code. (Don't worry about homes still on the market; what matters is how much a buyer will actually pay.) Preferably the sales should have been closed within the last six months, but go back further if there hasn't been much activity. Include sales of nearby homes in similar neighborhoods, with similar square footage and similar amenities.
If you use a "comp" for a more expensive home, be sure to point out why that home is worth more than yours. Perhaps it has an extra bedroom or bathroom, a pool, or has more square footage. Maybe the lot is larger or the location is more desirable.
I also note that many of my "comp" properties have had recent renovations, such as a new kitchen, deck, or professional landscaping, whereas my house still has original flooring and appliances. (If you have done a major remodel recently, there's no need to call attention to it in your narrative—just leave this part out.) Remember the cartoon; you're drawing the picture the real estate appraiser sees (the dilapidated shack).
If the "zestimate" and a handful of recent sales of comparable homes in your area are lower than your assessment, you have a good chance of winning your appeal. I've been successful two years in a row, and I'm hoping the results of my 2019 appeal will also be successful.
In our experience for the past two years, when the property tax bill arrives in the fall, it is for approximately 85% of the total amount the county thinks we owe, and it's noted: "under appeal." Then in January, an assessor comes to look at the property (outside only) and make a final determination.
The first year we appealed, we received an additional refund from the county after the assessor's visit. Last year, we received a small bill after the appeal was finalized, but that amount plus the original 85% added up to less than we would have had to pay had we not appealed.
With just a little effort, you could save hundreds of dollars!
Have you ever thought about appealing your property taxes? I'd love to hear your comments.
Sharon Marchisello is the author of Live Well, Grow Wealth.
March 21, 2019
Countdown to Financial Fitness: Why Must Everyone Go to College?
Countdown to Financial Fitness: Why Must Everyone Go to College?: Our country is reeling from a national scandal involving wealthy parents bribing coaches and administrators at prestigious universities to...
Why Must Everyone Go to College?
Our country is reeling from a national scandal involving wealthy parents bribing coaches and administrators at prestigious universities to admit their children because these kids were unable to get accepted on their own merit. Why is that very expensive piece of paper so important?
College can be a rewarding experience, the source of lifelong friends. A degree is essential for entry into many professions. But without rich parents or a full-ride scholarship, earning a college degree can plunge a student deep into chasms of debt. And sometimes, unable to find a job that pays well enough to retire that debt for decades.
Some high-priced degrees don't prepare the student for any particular career. Thus, the graduate ends up working in the service industry, holding a minimum-wage job that doesn't require a degree at all.
Mired in all that student-loan debt, the graduate is financially unable to start enjoying the elements of the traditional American dream: owning a home, starting a family, indulging one's passions.
In Europe, high school students are directed toward the training that best matches their aptitudes and interests. Why force every child onto an academic path? It's demoralizing for those who are not suited, and it keeps them from developing skills in other fields where they might excel. Fields where good-paying jobs exist.
There's no stigma in many other countries for someone who attends two years of vocational school, apprentices to be a plumber, an electrician, a carpenter, a mechanic, etc., and then immediately goes to work in a lucrative profession, with very little debt. Why not encourage more technical training in America? Why can't it be more respectable to pursue careers where one can earn a decent living without an academic degree?
Arguments include, "But college provides a well-rounded education." "College should be a right." "Mine is the first generation to have the opportunity to go to college." However, many people learn just as well, if not better, outside the classroom. Some students don't even develop an interest in learning until later in life, after their formal education is finished. These days, there are countless opportunities for continuing education: reading, travel, public television programs, online webinars, professional organizations, special interest clubs, community colleges. All one needs is the basic foundation of reading, writing, and thinking—the skills that should be taught in the first twelve years of school.
I don't regret going to college, and I don't mean to sound hypocritical by implying that others shouldn't go. Just look at the price tag, and decide if you're getting good value for your money.
What are your thoughts on college? Should everyone go? I'd love to hear your comments.
Sharon Marchisello is the author of Live Well, Grow Wealth.
February 27, 2019
Learn Your Foreign Currency
We recently returned from a trip abroad, and I'm constantly amazed at stories from fellow travelers about how they grossly overpaid for services because they didn't understand the local currency. If there's one bit of homework you should do before you visit another country, find out what the exchange rate is.
It's especially confusing when you have to add lots of zeros to the currency unit to reach the USD equivalent. Local currency can seem like monopoly money. But tack on an extra zero or two, and suddenly you're handing out serious funds for tips and cab rides.
For example, we talked to a guy who thought he was tipping his bartender a generous ten dollars. After comparing notes with a local customer at the bar, he found out he'd just given the guy one hundred dollars. On the bright side, he got great service for the remainder of his stay!
When you exchange money, take a moment to look at the bills and coins you receive. Get a feel for how much each is worth compared to your home currency. Some denominations may look similar but vary greatly in value.
If the exchange rate for local currency versus your home currency is not easily divisible (i.e., two to one, three to one, ten to one, etc.), don't be afraid to whip out a calculator if you're not good at doing math in your head. We spoke to some women who'd paid three times the amount they thought they were negotiating for a cab ride from the airport into downtown Buenos Aires. (At this writing, there are approximately 38 Argentine pesos to the U.S. dollar. They'd just come from Chile, where the exchange rate is about 650 to one; they'd assumed the two currencies were similar in value.)
Sometimes it's easier and more cost-effective to pay with a credit card than to exchange money so you can pay with cash. However, many inexpensive services cannot be paid for with credit cards or foreign currency: bus rides, purchases at street markets, meals at small local restaurants, lots of taxis. If you do pay with a credit card, try to use one that doesn't assess foreign transaction fees, which can add up. Also, make sure you're clear on the amount charged. The vendor may quote the price in dollars but the charge will be entered in local currency. Verify that the amount on the slip you sign is equivalent to what you were quoted.
We had an overnight stay in Buenos Aires before boarding a cruise ship and we were able to pay for our hotel and transportation from the airport with a credit card. But when we inquired about a taxi to the pier, we were told the drivers only accepted local currency. The pier was quite close; the desk clerk advised us the fare should not be more than 300-400 pesos.
So, we set out to get cash from an ATM, which we do frequently when we travel abroad. But every machine we encountered assessed a transaction fee of between six and ten dollars. The fee wouldn't have been so onerous if we were withdrawing a large sum of money, but for the small amount we wanted, it did not seem cost effective.
After four or five unsuccessful attempts to withdraw money without an excessive fee, we decided to return to the hotel and cash a twenty-dollar bill at the desk. We knew the exchange rate would be worse, but they shouldn't charge a fee. Except then we found out our hotel did not offer currency exchange.
The desk clerk suggested he could call the taxi company and give them our credit card number, which they could charge when the ride was complete. We agreed, and he called us a cab.
En route to the pier, we verified the arrangement with the driver. Credit card number to the home office? He knew nothing about it. Frantically, he started texting back and forth with his dispatcher.
As we neared the pier, we eyed the meter, which still showed less than 200 pesos. "What if I just give you cash in U.S. dollars?" my husband asked.
"Much better," the cab driver replied. When we arrived at our destination, we handed him a five-dollar bill, and he was happy.
(When we got home, I checked my credit card statement to make sure no duplicate charge had appeared from the cab company. Fortunately, there was nothing.)
On board the ship, we played trivia with an Argentine native of Buenos Aires, and we told him the story of our cab ride.
"Ooh… you got ripped off! Five dollars!" he guffawed. "That ride shouldn't have cost you more than 100 pesos."
So we, too, were gullible, overtipping tourists. But the ride still cost us less than withdrawing local currency for the fare out of the ATM.
For more saving and investment tips read Live Well, Grow Wealth.
It's especially confusing when you have to add lots of zeros to the currency unit to reach the USD equivalent. Local currency can seem like monopoly money. But tack on an extra zero or two, and suddenly you're handing out serious funds for tips and cab rides.
For example, we talked to a guy who thought he was tipping his bartender a generous ten dollars. After comparing notes with a local customer at the bar, he found out he'd just given the guy one hundred dollars. On the bright side, he got great service for the remainder of his stay!
When you exchange money, take a moment to look at the bills and coins you receive. Get a feel for how much each is worth compared to your home currency. Some denominations may look similar but vary greatly in value.
If the exchange rate for local currency versus your home currency is not easily divisible (i.e., two to one, three to one, ten to one, etc.), don't be afraid to whip out a calculator if you're not good at doing math in your head. We spoke to some women who'd paid three times the amount they thought they were negotiating for a cab ride from the airport into downtown Buenos Aires. (At this writing, there are approximately 38 Argentine pesos to the U.S. dollar. They'd just come from Chile, where the exchange rate is about 650 to one; they'd assumed the two currencies were similar in value.)
Sometimes it's easier and more cost-effective to pay with a credit card than to exchange money so you can pay with cash. However, many inexpensive services cannot be paid for with credit cards or foreign currency: bus rides, purchases at street markets, meals at small local restaurants, lots of taxis. If you do pay with a credit card, try to use one that doesn't assess foreign transaction fees, which can add up. Also, make sure you're clear on the amount charged. The vendor may quote the price in dollars but the charge will be entered in local currency. Verify that the amount on the slip you sign is equivalent to what you were quoted.
We had an overnight stay in Buenos Aires before boarding a cruise ship and we were able to pay for our hotel and transportation from the airport with a credit card. But when we inquired about a taxi to the pier, we were told the drivers only accepted local currency. The pier was quite close; the desk clerk advised us the fare should not be more than 300-400 pesos.
So, we set out to get cash from an ATM, which we do frequently when we travel abroad. But every machine we encountered assessed a transaction fee of between six and ten dollars. The fee wouldn't have been so onerous if we were withdrawing a large sum of money, but for the small amount we wanted, it did not seem cost effective.
After four or five unsuccessful attempts to withdraw money without an excessive fee, we decided to return to the hotel and cash a twenty-dollar bill at the desk. We knew the exchange rate would be worse, but they shouldn't charge a fee. Except then we found out our hotel did not offer currency exchange.
The desk clerk suggested he could call the taxi company and give them our credit card number, which they could charge when the ride was complete. We agreed, and he called us a cab.
En route to the pier, we verified the arrangement with the driver. Credit card number to the home office? He knew nothing about it. Frantically, he started texting back and forth with his dispatcher.
As we neared the pier, we eyed the meter, which still showed less than 200 pesos. "What if I just give you cash in U.S. dollars?" my husband asked.
"Much better," the cab driver replied. When we arrived at our destination, we handed him a five-dollar bill, and he was happy.
(When we got home, I checked my credit card statement to make sure no duplicate charge had appeared from the cab company. Fortunately, there was nothing.)
On board the ship, we played trivia with an Argentine native of Buenos Aires, and we told him the story of our cab ride.
"Ooh… you got ripped off! Five dollars!" he guffawed. "That ride shouldn't have cost you more than 100 pesos."
So we, too, were gullible, overtipping tourists. But the ride still cost us less than withdrawing local currency for the fare out of the ATM.
For more saving and investment tips read Live Well, Grow Wealth.
Countdown to Financial Fitness: Learn Your Foreign Currency
Countdown to Financial Fitness: Learn Your Foreign Currency: We recently returned from a trip abroad, and I'm constantly amazed at stories from fellow travelers about how they grossly overpaid for...
February 11, 2019
Countdown to Financial Fitness: Plan for Contingencies
Countdown to Financial Fitness: Plan for Contingencies: Going without an expected paycheck is a hardship for most people. I've seen statistics claiming that one in three Americans is one payc...
Plan for Contingencies
Going without an expected paycheck is a hardship for most people. I've seen statistics claiming that one in three Americans is one paycheck away from homelessness. After the recent government shutdown, and watching footage of furloughed government employees lined up at soup kitchens, I suspect those numbers might not be far off.
And many jobs in corporate America are not as secure as a position with the federal government. My husband and I both worked in the airline industry during the eighties, nineties, and early two thousands, when carrier after carrier went bankrupt and/or laid off thousands of employees, and those remaining took huge pay cuts and lost benefits.
As I point out in my new book, Live Well, Grow Wealth, it's important to have an emergency fund.
What is an emergency fund? At least three to six months' living expenses stashed in a low-risk, liquid investment such as a savings account or money market fund. And it's money you don't touch unless there's an emergency: a large, unanticipated, unavoidable expense. Like losing your income.
Having an emergency fund saves you from diving deeply into debt, raiding your retirement savings and thus losing irreplaceable time value you've built up, or liquidating investments at an inopportune time, forcing you to lock in losses or incur unplanned capital gains.
If you don't have an emergency fund, now is the time to start building one. Setting aside a few dollars a week shouldn't be too daunting. Round up your change. Forgo a few treats or vices. The account won't look like much at first, but leave it alone and keep adding more; pretty soon, it will grow.
A great way to kickstart an emergency fund is with a lump sum. Maybe that tax refund you're hoping for? Or if you work for the federal government, maybe you'll receive a big check for back pay. Put what you don't need to cover unpaid obligations into your emergency fund.
What if you don't have time to save? You're living paycheck to paycheck, with nothing left over. Another shutdown is looming.
If you survived the last furlough, you hopefully developed some frugal habits out of necessity, some of which could be made permanent. Analyze your expenses and divide them into Essential and Discretionary. Drop subscriptions and memberships you're not using. Defer appointments for haircuts, manicures, professional cleaning, classes that have not been prepaid. Cook at home more, and build menus around what is on sale at the grocery store. Combine errands to use less gasoline. Don't shop for new clothes, electronics, toys, etc. Consider doing some things yourself that you normally pay someone to do for you, such as yard work, house cleaning.
Keep your credit record spotless or improve your score by always paying your bills on time. Leave plenty of available credit on your accounts and keep your debt ratio low. That way, if you do have to borrow money, you'll qualify for a decent rate and won't have to resort to usurious payday loans.
In my opinion, funding the government and paying its staff shouldn't be tied to other legislation, and politicians shouldn't jeopardize workers' livelihoods when they can't agree. But I'm not in charge. You have to be prepared for anything, by reducing your expenses so you're living within your means and building an emergency fund.
For more savings and investment tips, read Live Well, Grow Wealth
And many jobs in corporate America are not as secure as a position with the federal government. My husband and I both worked in the airline industry during the eighties, nineties, and early two thousands, when carrier after carrier went bankrupt and/or laid off thousands of employees, and those remaining took huge pay cuts and lost benefits.
As I point out in my new book, Live Well, Grow Wealth, it's important to have an emergency fund.
What is an emergency fund? At least three to six months' living expenses stashed in a low-risk, liquid investment such as a savings account or money market fund. And it's money you don't touch unless there's an emergency: a large, unanticipated, unavoidable expense. Like losing your income.
Having an emergency fund saves you from diving deeply into debt, raiding your retirement savings and thus losing irreplaceable time value you've built up, or liquidating investments at an inopportune time, forcing you to lock in losses or incur unplanned capital gains.
If you don't have an emergency fund, now is the time to start building one. Setting aside a few dollars a week shouldn't be too daunting. Round up your change. Forgo a few treats or vices. The account won't look like much at first, but leave it alone and keep adding more; pretty soon, it will grow.
A great way to kickstart an emergency fund is with a lump sum. Maybe that tax refund you're hoping for? Or if you work for the federal government, maybe you'll receive a big check for back pay. Put what you don't need to cover unpaid obligations into your emergency fund.
What if you don't have time to save? You're living paycheck to paycheck, with nothing left over. Another shutdown is looming.
If you survived the last furlough, you hopefully developed some frugal habits out of necessity, some of which could be made permanent. Analyze your expenses and divide them into Essential and Discretionary. Drop subscriptions and memberships you're not using. Defer appointments for haircuts, manicures, professional cleaning, classes that have not been prepaid. Cook at home more, and build menus around what is on sale at the grocery store. Combine errands to use less gasoline. Don't shop for new clothes, electronics, toys, etc. Consider doing some things yourself that you normally pay someone to do for you, such as yard work, house cleaning.
Keep your credit record spotless or improve your score by always paying your bills on time. Leave plenty of available credit on your accounts and keep your debt ratio low. That way, if you do have to borrow money, you'll qualify for a decent rate and won't have to resort to usurious payday loans.
In my opinion, funding the government and paying its staff shouldn't be tied to other legislation, and politicians shouldn't jeopardize workers' livelihoods when they can't agree. But I'm not in charge. You have to be prepared for anything, by reducing your expenses so you're living within your means and building an emergency fund.
For more savings and investment tips, read Live Well, Grow Wealth
January 14, 2019
Enough Money
"If only I made $80,000 a year!" one of my carpool colleagues once told me. "I'd never care what anything costs." At the time, we were each earning around $50,000 annually so it seemed like an $80,000 salary would put someone on Easy Street.
I didn't agree. I don't think I'll ever get to a point where I don't consider how much things cost. No matter how many millions I have socked away. Why would I pay more than I have to for anything?
Pay more for better quality, certainly, or perhaps the convenience of obtaining something quicker. Who doesn't like to be pampered, especially if you can afford it? But even billionaires look for deals and freebies. Wealthy people don't pay more than they have to; that's how they stay wealthy.
And conversely, that's how lottery winners and others who suddenly come into a fortune end up losing it all. They indulge every fantasy, and they stop caring how much things cost.
Big purchases bring along big expenditures. Beyond the $200,000 price tag for that new sports car are increased costs for insurance and maintenance. And you'll have to feed it premium gasoline instead of regular. Multiple luxury homes incur multiple tax bills, and they have to be furnished and maintained. You need to hire people to take care of them. And the more square footage, the higher the utility bills.
That's why wealthy families who inherit castles and historic mansions turn them over to foundations and open them to the public, for an entrance fee. The upkeep costs would otherwise drain their estates.
Money can make you comfortable. It can make life easier. It's possible to reach a point where your money earns enough to fund your lifestyle so that you don't have to work for a paycheck. But money is still a finite resource.
My frugal attitude came from being raised by parents who lived through the Great Depression. They remembered what it was like to struggle to make ends meet, and they taught me never to waste anything—especially money.
And it makes sense. Unless a higher price tag adds value, why pay more than you have to for anything?
For more saving and investment tips read Live Well, Grow Wealth.
I didn't agree. I don't think I'll ever get to a point where I don't consider how much things cost. No matter how many millions I have socked away. Why would I pay more than I have to for anything?
Pay more for better quality, certainly, or perhaps the convenience of obtaining something quicker. Who doesn't like to be pampered, especially if you can afford it? But even billionaires look for deals and freebies. Wealthy people don't pay more than they have to; that's how they stay wealthy.
And conversely, that's how lottery winners and others who suddenly come into a fortune end up losing it all. They indulge every fantasy, and they stop caring how much things cost.
Big purchases bring along big expenditures. Beyond the $200,000 price tag for that new sports car are increased costs for insurance and maintenance. And you'll have to feed it premium gasoline instead of regular. Multiple luxury homes incur multiple tax bills, and they have to be furnished and maintained. You need to hire people to take care of them. And the more square footage, the higher the utility bills.
That's why wealthy families who inherit castles and historic mansions turn them over to foundations and open them to the public, for an entrance fee. The upkeep costs would otherwise drain their estates.
Money can make you comfortable. It can make life easier. It's possible to reach a point where your money earns enough to fund your lifestyle so that you don't have to work for a paycheck. But money is still a finite resource.
My frugal attitude came from being raised by parents who lived through the Great Depression. They remembered what it was like to struggle to make ends meet, and they taught me never to waste anything—especially money.
And it makes sense. Unless a higher price tag adds value, why pay more than you have to for anything?
For more saving and investment tips read Live Well, Grow Wealth.
