All posts by Jacob A Irwin
Aldi vs. Wal-Mart vs. All the Rest
As you all might know, the Northeast isn’t too fond of Wal-Mart. Furthermore, they are less fond of putting Wal-Mart Supercenters every 4 miles around the neighborhoods. As a result, the nearest Wal-Mart Supercenter is 10 miles south (so about 30 min in the Northeast traffic) as opposed to in Virginia and Arkansas where I last lived, where there were two Supercenters within 3 mi of my house. Irregardless of your opinion of Wal-Mart, the store, because of its influence, can be the source of some interesting comparisons.
So, with the Wal-Mart Supercenter 30 minutes away from my house, I have been going to the local grocery stores (Genuardis, Giant, Weigmans, etc) to get my food, and just going to the local regular Wal-Mart for household items.
However, tonight, I decided to give Aldi a try. They have a store that is only 2 minutes from my house, and I hadn’t been to one since sophomore year of college.
When I arrived, I quickly realized that I was totally unprepared because everything about the store translates to savings for the consumer.
First, when you park in the parking lot, you notice that there are no stray shopping baskets taking up spaces. Why is this? Because you have to place a quarter deposit in to the shopping basket in order to get a shopping cart. You get the quarter back when you return the cart, but this very act eliminates numerous jobs that are occupied at all other grocery stores and Wal-Marts across the country. Genius!
Second, at the entrance, it says in big bold print that they don’t accept credit cards or checks!!! haha Amazing! However, they do accept debit cards or cash. This just further decreases their expenses.
Third, there are no shelves in the store. The goods/products are merely stacked in the boxes they arrive on. What does this mean? You got it. You don’t need a Wal-Mart representative whose sole job is dedicated to negotiating where the Pringles can will sit on the shelf. Genius!
Fourth, Aldi almost absolutely (with only a few minor exceptions) sells their private label that they themselves distribute. This would be the same if you could imagine Wal-Mart only selling their Great Value label. Genius!
Fifth – the number of employees. The entire time I was there, I only saw one Aldi employee, and that was the one guy checking people out.
Sixth, Aldi doesn’t refrigerate items that don’t need to be refrigerated (This includes certain lettuce and other vegetables that don’t need to be kept cool).
Seventh – the check out process. Like I said before, you can’t use a credit card, which further cuts down Aldi’s costs. Next, you have to purchase your own bags or bring your own. Finally, the cashier does not bag or containerize your items. You have to do that yourself.
So, with all these potential areas for savings, how does Aldi stack up? Well, according to the article at the link below, they are 29% cheaper than Wal-Mart and 86% cheaper than the local grocery stores. I now believe this, having taken a trip there.
Grocery Price Comparison Article
The following is an excerpt from the article – “Here is where Aldi really shines, with rock bottom prices even cheaper than Walmart’s store brands. Nearly 29% cheaper than Walmart and 32.5% less than Target. The two supermarkets were 86% and 76.3% more expensive on these private label products than Aldi.”
Looking over my receipt today, here are several of the purchases that amazed me the most:
- 10 lbs of potatoes – $2.50
- Tropical Fruit Salad – $0.79 – I know this is $1.00 or more at Wal-Mart
- 5 lbs of lasagna – $2.69 – wow!
- 4 lbs of fuji apples for $3.12
Given the evidence, what’s the bottom line?
Aldi definitely saves you money if you are willing to work a little extra for your groceries and pass up getting “name brand” items. However, in a tough economy, it just might be the thing to do!
Keep on learning!
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Requests for Future Blog Topics and Guest Posting
I wanted to share two things with you all so that you know they are available:
Request for Topics
If anyone has a request for a topic they’d like me to research and post, please just write it on the comments area of this post or email me at irwin.jacob@gmail.com.
Guest Posting
Also, I just found out that I can assign multiple people as being able to post to this blog. So, if you have a topic that you know a lot about and would be beneficial to share with the My Money Blog family, please just let me know!
Keep on learning!
Jacob
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Promote Yourself or Your Business with FREE Business Cards
I wanted to share a wonderful find that I discovered about 5 years ago, and have now used successfully four times!
What is it? FREE business cards from Vistaprint.com
Business cards are truly a great thing – good for networking, retaining people’s contact information, advertising your business, or making yourself stand out at an interview by being more “professional.”
I have used/designed free business cards from Vistaprint for the four applications shown below over the past several years:
- Created a personal card with my contact information and a summary of my skills/qualification to be used at networking events and during interviews.
- Created a card with my web address for this blog in order to post on bulletin boards to advertise.
- Created a card for the pet waste removal service I started in 2006.
- Created a card for the eBay business I started in 2004 reselling people’s items.
To get your own free business cards, just follow the simple steps below:
1) Click on the picture/link below to go to the Vistaprint site
2) Within in the site, go to the business card section, and select that you want to create a free business card. There are several restrictions that Vistaprint keeps you to in order to make it possible to have free business cards – you can not print on both sides of the card and the background design has to be kept as the default tree/country scene.
3) You can then click through the options and build your card line by line. Quick tip: make sure that you don’t fill the card up too much so there is sufficient free space around the outside of the card.
4) When you are finished, proceed to the checkout process, opting out of any of the additional advertised products/services. The total will be around $7-$9 for shipping/handling fees.
5) The business cards will then be shipped to you within several business days!
Couldn’t be easier, right?! Right!
Keep on learning!
Jacob
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Find and Eliminate Your Latte Factor – Save Big Money
In this addition of My Money Blog (Yes – That’s right, I’ve been watching too many episodes of MythBusters lately on my instant Netflix cue), we’ll discuss a topic that I learned in the very first book I ever read about personal finance and frugal living, David Bach’s “Automatic Millionaire.” I would definitely recommend you order a copy of this book used from Amazon. I’ve provided the link below if anyone is interested! You can’t beat Amazon – $0.94 for a great book! I love it.
One of the best topics David introduces in this book is the idea of a “Latte Factor.” The idea behind this is that for people that buy a latte from Starbucks everyday for $3, this compounds to a lot of money over time. The same can be said for all sorts of luxury purchases made everyday. The article from MSN below summarizes some of these additional purchases to think about.
10 Expenses that Add Up Fast – MSN Money Central
So what’s the big deal? Why is spending such a little amount of money every day a bad thing? Doesn’t it enhance my life? Well, the bad news is that if this money was instead saved and invested for the long-term, the miracle of compound interest will kick in, and you will have a lot of money by the time retirement comes.
The website from MSN gives 10 examples, but let’s take my two favorite ones because, well, I’m writing this blog, and get to do what I want to do. 🙂 Just kidding.
Finding Your Latte Factor – Buying Coffee and Lunch Every Workday
According to the MSN website, the average cup of brewed coffee costs $1.38 (this seems a little low, but OK). This would translate to $360 per year to buy a cup of coffee every workday. The average lunch during the workweek costs $9 (this seems a little high, but I just spent $11 on lunch today for a sandwich and salad at my company’s cafeteria because I forgot to pack my lunch). This would translate to $2,340 per year to buy lunch every workday.
Adding these two numbers together results in a sum of $2,700 per year for lunch and a cup of coffee. This is getting to be a lot of money!
Applying the miracle of compound interest, let’s assume you start work when you are 23 y.o, work until you are 65 y.o, and take the $2,700 you save by NOT buying coffee and lunch each day at work and invest it in a small cap value index mutual fund with a historical return of 12.4%.
Doing the math, this translates to a nest-egg of $2,930,299.20 when you retire at age 65. Wow!
What’s the take-home message here? Well, first, probably you should try to bring your lunch more and brew your own coffee at home! But, honestly, it’s not that you should eliminate all purchases in your life, but just to be mindful about recurring ones that you may not think are costing you that much each day.
Keep on learning!
Jacob
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Build Your Credit Score From Nothing – Part 3
Once you have settled on an arrangement that will work for both sides, you can then delve in to figuring out the specifics of the loan (i.e. interest rate you will be charged).
5) After finding out the details of what the $1000 personal loan would entail, tell the loan officer that you want to shop around a little before making your final decision. He/she will completely understand (or should anyway). Then, go to the 1-2 other recommended local banks on your list and do a loan comparison in order to make sure you’re receiving the most favorable terms.
Keep on eye out for Part 4 of this series, coming soon!
Build Your Credit Score From Nothing – Part 2
In Part 1 of this series, I walked everyone through how they can give their high-school age child a financial headstart in life by getting them their own student credit card at an early age and begin accumulating a credit history. See the link below to that post if you missed it.
Part 1 – Build Your Credit Score From Nothing
In Part 2, I’ll discuss another very important and easy way to build your credit history – simply paying your for you housing in your name. It seems simple, but many things can get in the way of you doing this correctly.
So, let’s take me as an example because I am someone who missed this opportunity while I was in college.
For the first year of college, I lived in the dorms on campus. Because everything is paid directly to the univerisity and included in one lump sum, there were no utility, phone, or internet bills in my name to build credit history. During the 2nd – 4th years of college, I lived in a house that one of my friend’s family owned. To make things easier, I paid his family a lump payment each month that included utilities. You guessed it! No bills were in my name, and therefore, no credit history.
So, as sad as it is, I made it through college without ever paying one bill in my name. Amazing! This exact same situation can also happen to people who have their own apartment if the bills are placed in their parents name and mailed to an address half way across the state so that the college student never even sees it!
What’s the moral of the story here?
Rent an apartment or house in college, get the bills placed in your name (not your roomates, not your parents, YOURS!), and accumulate a generous amount of credit history before you are even out in to the real world!
Keep an eye out for Part 3 of this series – coming soon. Click on the link below to subscribe to my blog and have it sent to you when it is posted.
Subscribe via Email to My Money Blog
Keep on learning!
Jacob
Go To Build Your Credit Score From Nothing – Part 3 – “Take Out a Small Personal Loan”
What Moving Expenses Can I Deduct on My Taxes?
To answer this question question in the most straight-forward, no frills way possible, I put together the list of eligible deductions below to help you save money moving:
- Hotels/lodging en route to your new home. Save your receipts.
- Gas expenses incurred en route. Save your receipts.
- Household goods relocation services/fees associated with your move. Save your receipts.
- Mileage added to your car during the move. For 2009, the standard deduction rate was $0.24 per mile (see link below). For example, in my move from VA to PA, the distance was 293 miles. 293 mi x $0.24 per mi = $70.32 to deduct on my taxes.
2009 IRS Standard Mileage Deduction Rates
There you go! Plain and simple for you!
To learn about additional tax techniques, subscribe to my blog using the link below:
Keep on learning!
Jacob
My Individual Stocks Gain or Loss Results Reported for 2009 Taxes
So, let’s look at my gains (or losses) for the past two years tax calculations resulting from the individual stocks that I sold vs. the performance of the S&P 500 index:
Year 2008 — $300 loss, S&P500 return = 40% loss
Year 2009 — $592 loss, S&P500 return = 26% gain
So, in 2008, I did all right as compared to the market, but in 2009, the proceeds from the stocks sold in my accounts generated far inferior results.
Just a little background on why I have stock holdings at all:
I have stock holdings remaining still my my first couple years of investing where I dabbled around with different techniques, penny stocks, investing newsletter, etc. Now that I have seen the light and the error in my ways, I no longer actively buy individual stocks, unless it is such a small amount that it is truly just to “play around with.”
What’s the morale of the story here?
For me, it just indicates further the following things:
1) Stick to long-term investing in index mutual funds, preferably in tax-sheltered accounts.
2) I do not trust myself enough with my own money to invest in individual stocks, especially over the long term.
Keep on learning!
Jacob
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Stop Using Cash or Your Debit Card, Make Money
Build Your Credit Score From Nothing – Part 1
It should be noted New Federal laws impose restrictions on issuing credit cards to individuals under 21 unless the applicant has the independent ability to repay debt, or has an adult co-signer who agrees to accept joint liability for the account. Having an adult co-signer on the account is OK, as long as it is a separate account, in the teen’s name.
Now that you are convinced of the efficacy of this idea, what’s the best way to go about setting this up for your teen?
1) Go to the link above. Select any one of the credit cards (DO NOT GET A PREPAID DEBIT CARD) that has no annual fee to apply for.
2) Fill out the application for the selected credit card, placing yourself, the parent, as a co-signer if needed.
3) Once you are approved, wait for the credit card to come in the mail.
4) When it comes in the mail, take the opportunity to sit down with your teen and set up his/her online account for them. This is also a great tool to use to teach your child all sorts of personal finance tactics! Explain that the card will not be used for everyday purchases, but instead, to build his/her credit score for the future.
5) Next, since this is a starter credit card, you have two options in my opinion: a) Set up some kind of automatic, recurring payment using the credit card each month, or b) Write yourself and your teen a reminder each month to use the credit card for one or two purchases on a set day.
6) Do not give the credit card to your teen. Place the credit card in your wallet or purse and explain that you will hold on to it for safe-keeping.
Well, that’s it! Not too hard right?! This will give your child a great financial head start on life in no time!
Important Tip – closing credit card accounts hurts your credit score
After you have opened up a student credit card account for your child, used it for some time, and built up a good amount of credit history, you may be tempted to close the account, since you (or your child) really don’t need it any more.
However, closing down the old credit card account will actually lower your credit score in two ways:
- First, it decreases your credit history, which accounts for 15% of your credit score.
- Second, it increases your credit utilization rate (% of the total credit available to you that you currently use).
So, the key takeaway here is that if the credit card is no longer used, lock it away in the family safe, check the balance every month or so to make sure no fraudulent activity is occuring, and go about your life!
Keep an eye out for Part 2 of this series coming soon. Please subscribe to my blog feed using the link below to have it sent to you immediately once it is published!
Keep on learning!
Jacob
Go to – Build Your Credit Score From Nothing – Part 2 – “Pay housing bills in your name”