I don't like the tip system. I go to a hair salon that doesn't let its stylists accept tips (it pays them well). But I still tip waiters/esses 20% because I know that's how they're supposed to make their money. If they couldn't expect tips, then the restaraunt would just up the price of the meal to cover their wages (like my salon that charges $45 instead of $10 or $20 for a haircut) and I'd pay more anyways. I'd prefer that system, but it is what it is. I went to steak & shake recently and wound up with a $5 meal (they really shouldn't have people who serve for tips) and I tipped the waiter $5, because waiting on a table really can't be worth less than $5. I'm frugal, but I'm not cheap.
Costco is certainly worth it for us with a little one in diapers. I don't have to clip coupons to get good prices on these. Other stuff, not a true "Bargain", but good nonetheless. They have good prices on wine and veggies/fruit, which we eat lots of. Plus, milk is pretty cheap. We are exec. members and always make our membership money back.
I've found that the warehouse stores have promos, one day passes and such. I bring in my price chart, see what's a good deal and stock up. Some even allow for a trial membership. It's not a good deal if you have no place to store stuff, though.
One way to save money on your Costco membership is to split a membership with someone else. They don't have to be a relative, you can split it with a friend. And they don't even have to live in the same city. Costco cards are good anywhere. Just go to the customer service desk and say you want to get a second card, and then the other person will bring in the membership number to their local Costco and get their own card. It's much easier to recoup the cost of membership if you're only paying for half of it.
Loaning money can be horrible, and every real friend who has asked has understood when I told them my no-loaning policy. But if they need money for food, I invite them for dinner, or if they need money for car repairs, I offer them a ride to the store. I'm not stingy about service.
I totally agree that the warehouses prices on products aren't that much cheaper but we find the services hard to beat. We have our car insurance through Costco's program and we pay $1200 for a 2007 Saturn SUV and 2003 Toyota Matrix. I have not been able to come close to that with offers that I get from other insurance companies. We also buy our bank checks through them because we find it to be alot cheaper also. (Of course, you have to buy alot but we're not planning on changing banks anytime soon so it's ok).
I have a friend slush fund. There are a group of 5 of us who have all borrowed from and loaned to each other. This has worked for us for about 10 years because we set time limits and write a promise letter to document the transaction. For example, a few years back I borrowed money from my friend Julien. In my letter I promised that he'd be paid back in 90 days or he could sue me on the Judge Judy show. We try and make the consequences embarrassing and public so we're incentivized to keep our word. Typically our loans are for situations like: "I need an additional $3000 to repair the plumbing in my house that just went south and I won't get my bonus check until July 16th." They are short term loans to solve specific problems. Obviously this system only works for people who are generally responsible friends and responsible with money.
I've been on both sides of that coin several times earlier in life when I was more trusting. Neither is a good place to be, whether you're the one who owes or the one owed.
This is one of those areas in life where learning to say no politely, forcefully and EARLY can keep you and your friends out of some tense circumstances.
There was a line from Shakespeare on that, "do not a lender nor a borrower be"--good advice especially with friends.
Thank u for your story I just received this card in the mail today which I never applied for & was thinking about activating it before I read ur story. So once again AGAIN!!!
I have the Costco card and it is definitely worth it for me, but I also only get the membership every other year. My savings are mostly in the form of flour (white bread flour and wheat flour), sugar, and yeast. Buying one large bag of each already makes up for the membership cost, and since my family goes through 2-3 loaves of homemade bread a week we use the large quantities that we buy. I also only pay for the membership every other year though - at the end of the month that my membership will expire I stockpile a year's worth of supplies (in my garage mostly, my house is only 900 square feet) and then let the membership run out. Over the next year I use the supplies, and then 12 months later get the card and stock up all over again. Even if I got the membership every year I would still save money, but with doing it every other year I really am saving a whole lot more.
While I know that I don't always get the best deals on paper products, I at least know that I'm getting a good deal on a good product at Costco. Furthermore, buying in bulk saves me the hassle of going to the store a multitude of times for non-perishable goods when they run out--which also saves the gas I would use for a multitude of trips.
I am careful about what groceries I buy here, and share the fruits I purchase with a co-worker when I know my family can't eat them all before they get overly ripe. Their individually packaged meats are fantastic for meal planning.
And best of all, they provide wonderful customer service that I have NOT experienced else where. Having a pleasant shopping experience like that is worth $50/year or $4.16/month for me.
Glad to know that you said no for now. If the broker is really pushy it could mean that the market really isn't all that great and they are sort of desperate to sell homes. Anyway, like many others said, the recovery would not be super fast so you have time to look and decide.
Xin Lu--We've been going to Sams for many years now and are generally satisfied with the prices and selections, and the annual fee is in the neighborhood of $35. But we have teenagers, two refridgerators and ample storage space, so it makes sense.
However I do agree with much of what you're saying. Merchandise isn't always cheaper just because it's in a warehouse. You really do have to be aware of prices all over to know if you're saving money. Also it does appear that the price advantages versus regular grocery stores is narrowing. We've found milk, eggs and often meat to be cheaper at grocery stores.
Another thing I've noticed is that the warehouse advantage seems to be disappearing since the economy tanked. The mainstream grocery stores seem to have reacted by cutting prices. We're buying more at grocery stores now than we did a year or two ago.
Having 20% to put down is NOT the most important consideration for buying a home.
As a banker we consider strength and stability of income far above ability/willingness to put 20% down. If you can afford to buy and still have a debt-to-income ratio under 40% (including taxes and insurance), then that's a big check.
Credit score above 700 is another big check. It will get you the best rates and proves you can handle the responsibility of debt and regular payments.
Liquidity is the final factor. We'd rather see you have a few months of savings left in the bank AFTER closing than put down a 20% downpayment. We consider a 10% down payment to be "strong" for first time buyers. If you're buying a second home or investment property then 20% is "strong" and preferable.
If you are ready to buy and know you want to stay put for 5 years or more then DO IT. It's one thing if you have NO downpayment, but if you have 10% then quit worrying about it and just do it.
I think you're on to something real with this post. It helps to explain why the going-green concept has spread so far and wide so quickly. In a stronger economy this might not have been the case.
The other thing that may be happening as well is that it's a marketing gimic. I mean think about it, all of the sudden it's cool to be green? Even non-environmentalists are embracing it with the zealotry of a convert. But I'm guessing it's just the du jour thing, and everybody's jumping on the bandwagon.
If they truly were going green, you'd see air conditioners being turned off, cars being parked or scrapped and bottled water being ditched in favor of water coolers. Until substantial things like that start happening, I think this trend is mostly superficial and driven by unstated intentions.
Costco may save us money; it probably does. But I actually keep our membership because I trust Costco to carry good quality stuff at a good price. There are certain things I'm willing to research and bargain shop for, but when my husband says we need a fire safe, I can go to Costco, pick up the one model in the size he wants and trust that the quality and price are good. Same with a GPS, same with an external hard drive, same with tires, etc. etc. Were I to find one day that the quality goes down, prices get too high or the selection increases too much, I will very quickly cancel my membership. Right now those are at a nice sweet spot. I might be able to save more hunting around town or the internet, but my time is worth something to me too.
I love Costco.
With executive membership ($100) you get 2% back on your purchases and then if you use the True Earnings Credit Card from American Express you get 3% on gasoline 2$ on travel and 1% on everything else including Costco. Your membership pays for itself with some money left.
The quality of the produce and fruits is excellent, some of it might be cheaper at the regular grocery store, but the size and the quality from Costco are better. Their return policy is amazing, simple if you don't like just return it, no questions ask.
I totally agree with you. While wholesale clubs may be a good deal for large families, I don't think they are cost effective for most people. I have never belonged to a wholesale club but used to be a big fan of big box discount stores. That was until I realized that it was only a rare occasion that I could get out of these stores for less than $200. There were just too many good deals on stuff that I didn't need but thought that I wanted or just didn't want to miss out on the bargain. Now that I've limited my big box shopping to 3-4 times a year for items that I just can't get somewhere else at a good price, my monthly spending has dropped from around $600 a month to just under $400. (that's for groceries, clothes, cleaning supplies etc.)
Like you said if you take the time to pay attention to the sales, you can easily find better deals.
We just bought (2 months ago). We had 10% down. We got 4.85% on a 30 year fixed rate mortgage. We have a plan to pay the mortgage off early.
The real reason we bought though, wasn't the money. It probably would've made more financial sense to rent for a few more years.
The real reason was that we were moving to a new city for a new job, and we wanted to find a place to settle down in. We were and are willing to pay the premium to get that. We were tired of apartment living and wanted a place we could garden, and with a yard for our kids.
We easily afford the monthly payments, and even if we don't pay it off early, it's something worth spending on for us.
Everyone buys things that don't contribute to their financial well being, it's called enjoying your money. As long as you are meeting your financial responsibilities, I don't see a problem with that even if you are paying more for it than you would have otherwise.
Savings on one item from the Health/Beauty Dept pays for my membership every year. Otherwise, as I am shopping for 1 or 2 people, the groceries are usually not on the list, Frozen fish usually is. The roasted chicken always is - 3-4 lbs. chicken for $5 vs grocery store for scrawny 2 -2.5 lbs at $8. I do make storage room for toilet paper, paper towels and tissues. One does have to shop carefully and not succumb to impulse buys and it does pay off for us. I didn't think it would for just the 2 of us.
We refer to the free food samples as a 'New Jersey Buffet' -- from a Stephanie Plum novel by Evanovich.
We keep a warehouse membership for one reason, and one reason only. We're both on non-drowsy allergy medications, such as Zyrtec and Claritin. I can buy 180 tabs of store brand Zyrtec for around $22 at BJ's, which is far lower than I can get it elsewhere.
We could buy limited quantities of Zyrtec by shopping smart and using coupons and we MIGHT save a little more than at BJ's, but we wouldn't be able to buy enough to keep the household stocked regularly.
Same thing with stuff like Osteo Bi-Flex. The other day I scored 3 $5 off coupons by begging them off friends, and found it BOGO at Teeter, making one 40 count bottle only $3. HOWEVER - I take 2 per day and my husband takes 2 per day. So that $3 bottle lasts us 10 days. With my multiple trips (required to use coupons on each bottle due to HT BOGO/coupon policy) I was only able to get us a 30 day supply.
Whereas at BJ's it will cost more than the coupon-hunted price above but the cost for a much larger bottle is less than what the store's regular price. So I might go to a grocery store to take advantage of a really great sale, but for everyday use, I need to go to BJ's.
We currently have a Costco membership, but will be letting it expire in November because...
1) The more you spend the more you save. We've been being more frugal, which means we spend less. We don't shop enough to save as much money.
2) The best savings are on name-brand products. Buying cheerieos in a 1000 serving box is probably cheaper than the smaller boxes at the local grocery. Even cheaper though is buying offbrand imitations. We do buy some name brand things (Oreos!), but not enough to save a ton at Costco.
3) You save the least on staples. It seems like staples (flour, sugar, veg. oil, rice, beans) aren't as good of a deal as other items, and name brand really doesn't matter much with these items either. Since we've been cooking more, we just wait for bulk sales at the local grocery stores and buy then.
I don't like the tip system. I go to a hair salon that doesn't let its stylists accept tips (it pays them well). But I still tip waiters/esses 20% because I know that's how they're supposed to make their money. If they couldn't expect tips, then the restaraunt would just up the price of the meal to cover their wages (like my salon that charges $45 instead of $10 or $20 for a haircut) and I'd pay more anyways. I'd prefer that system, but it is what it is. I went to steak & shake recently and wound up with a $5 meal (they really shouldn't have people who serve for tips) and I tipped the waiter $5, because waiting on a table really can't be worth less than $5. I'm frugal, but I'm not cheap.
Costco is certainly worth it for us with a little one in diapers. I don't have to clip coupons to get good prices on these. Other stuff, not a true "Bargain", but good nonetheless. They have good prices on wine and veggies/fruit, which we eat lots of. Plus, milk is pretty cheap. We are exec. members and always make our membership money back.
I've found that the warehouse stores have promos, one day passes and such. I bring in my price chart, see what's a good deal and stock up. Some even allow for a trial membership. It's not a good deal if you have no place to store stuff, though.
One way to save money on your Costco membership is to split a membership with someone else. They don't have to be a relative, you can split it with a friend. And they don't even have to live in the same city. Costco cards are good anywhere. Just go to the customer service desk and say you want to get a second card, and then the other person will bring in the membership number to their local Costco and get their own card. It's much easier to recoup the cost of membership if you're only paying for half of it.
Loaning money can be horrible, and every real friend who has asked has understood when I told them my no-loaning policy. But if they need money for food, I invite them for dinner, or if they need money for car repairs, I offer them a ride to the store. I'm not stingy about service.
I totally agree that the warehouses prices on products aren't that much cheaper but we find the services hard to beat. We have our car insurance through Costco's program and we pay $1200 for a 2007 Saturn SUV and 2003 Toyota Matrix. I have not been able to come close to that with offers that I get from other insurance companies. We also buy our bank checks through them because we find it to be alot cheaper also. (Of course, you have to buy alot but we're not planning on changing banks anytime soon so it's ok).
I've always liked the old saying: "If you lend someone $20, and then never hear from them again, it was probably worth it."
I have a friend slush fund. There are a group of 5 of us who have all borrowed from and loaned to each other. This has worked for us for about 10 years because we set time limits and write a promise letter to document the transaction. For example, a few years back I borrowed money from my friend Julien. In my letter I promised that he'd be paid back in 90 days or he could sue me on the Judge Judy show. We try and make the consequences embarrassing and public so we're incentivized to keep our word. Typically our loans are for situations like: "I need an additional $3000 to repair the plumbing in my house that just went south and I won't get my bonus check until July 16th." They are short term loans to solve specific problems. Obviously this system only works for people who are generally responsible friends and responsible with money.
I've been on both sides of that coin several times earlier in life when I was more trusting. Neither is a good place to be, whether you're the one who owes or the one owed.
This is one of those areas in life where learning to say no politely, forcefully and EARLY can keep you and your friends out of some tense circumstances.
There was a line from Shakespeare on that, "do not a lender nor a borrower be"--good advice especially with friends.
Thank u for your story I just received this card in the mail today which I never applied for & was thinking about activating it before I read ur story. So once again AGAIN!!!
I have the Costco card and it is definitely worth it for me, but I also only get the membership every other year. My savings are mostly in the form of flour (white bread flour and wheat flour), sugar, and yeast. Buying one large bag of each already makes up for the membership cost, and since my family goes through 2-3 loaves of homemade bread a week we use the large quantities that we buy. I also only pay for the membership every other year though - at the end of the month that my membership will expire I stockpile a year's worth of supplies (in my garage mostly, my house is only 900 square feet) and then let the membership run out. Over the next year I use the supplies, and then 12 months later get the card and stock up all over again. Even if I got the membership every year I would still save money, but with doing it every other year I really am saving a whole lot more.
While I know that I don't always get the best deals on paper products, I at least know that I'm getting a good deal on a good product at Costco. Furthermore, buying in bulk saves me the hassle of going to the store a multitude of times for non-perishable goods when they run out--which also saves the gas I would use for a multitude of trips.
I am careful about what groceries I buy here, and share the fruits I purchase with a co-worker when I know my family can't eat them all before they get overly ripe. Their individually packaged meats are fantastic for meal planning.
And best of all, they provide wonderful customer service that I have NOT experienced else where. Having a pleasant shopping experience like that is worth $50/year or $4.16/month for me.
Glad to know that you said no for now. If the broker is really pushy it could mean that the market really isn't all that great and they are sort of desperate to sell homes. Anyway, like many others said, the recovery would not be super fast so you have time to look and decide.
Xin Lu--We've been going to Sams for many years now and are generally satisfied with the prices and selections, and the annual fee is in the neighborhood of $35. But we have teenagers, two refridgerators and ample storage space, so it makes sense.
However I do agree with much of what you're saying. Merchandise isn't always cheaper just because it's in a warehouse. You really do have to be aware of prices all over to know if you're saving money. Also it does appear that the price advantages versus regular grocery stores is narrowing. We've found milk, eggs and often meat to be cheaper at grocery stores.
Another thing I've noticed is that the warehouse advantage seems to be disappearing since the economy tanked. The mainstream grocery stores seem to have reacted by cutting prices. We're buying more at grocery stores now than we did a year or two ago.
Having 20% to put down is NOT the most important consideration for buying a home.
As a banker we consider strength and stability of income far above ability/willingness to put 20% down. If you can afford to buy and still have a debt-to-income ratio under 40% (including taxes and insurance), then that's a big check.
Credit score above 700 is another big check. It will get you the best rates and proves you can handle the responsibility of debt and regular payments.
Liquidity is the final factor. We'd rather see you have a few months of savings left in the bank AFTER closing than put down a 20% downpayment. We consider a 10% down payment to be "strong" for first time buyers. If you're buying a second home or investment property then 20% is "strong" and preferable.
If you are ready to buy and know you want to stay put for 5 years or more then DO IT. It's one thing if you have NO downpayment, but if you have 10% then quit worrying about it and just do it.
I think you're on to something real with this post. It helps to explain why the going-green concept has spread so far and wide so quickly. In a stronger economy this might not have been the case.
The other thing that may be happening as well is that it's a marketing gimic. I mean think about it, all of the sudden it's cool to be green? Even non-environmentalists are embracing it with the zealotry of a convert. But I'm guessing it's just the du jour thing, and everybody's jumping on the bandwagon.
If they truly were going green, you'd see air conditioners being turned off, cars being parked or scrapped and bottled water being ditched in favor of water coolers. Until substantial things like that start happening, I think this trend is mostly superficial and driven by unstated intentions.
Warehouse stores are for families with a 1500+ ft house and at least a kid.
Costco may save us money; it probably does. But I actually keep our membership because I trust Costco to carry good quality stuff at a good price. There are certain things I'm willing to research and bargain shop for, but when my husband says we need a fire safe, I can go to Costco, pick up the one model in the size he wants and trust that the quality and price are good. Same with a GPS, same with an external hard drive, same with tires, etc. etc. Were I to find one day that the quality goes down, prices get too high or the selection increases too much, I will very quickly cancel my membership. Right now those are at a nice sweet spot. I might be able to save more hunting around town or the internet, but my time is worth something to me too.
I love Costco.
With executive membership ($100) you get 2% back on your purchases and then if you use the True Earnings Credit Card from American Express you get 3% on gasoline 2$ on travel and 1% on everything else including Costco. Your membership pays for itself with some money left.
The quality of the produce and fruits is excellent, some of it might be cheaper at the regular grocery store, but the size and the quality from Costco are better. Their return policy is amazing, simple if you don't like just return it, no questions ask.
I agree but I think it's much more simple: If you're "loaning" someone money DON'T expect to ever see it again. Just consider it a one time gift.
I totally agree with you. While wholesale clubs may be a good deal for large families, I don't think they are cost effective for most people. I have never belonged to a wholesale club but used to be a big fan of big box discount stores. That was until I realized that it was only a rare occasion that I could get out of these stores for less than $200. There were just too many good deals on stuff that I didn't need but thought that I wanted or just didn't want to miss out on the bargain. Now that I've limited my big box shopping to 3-4 times a year for items that I just can't get somewhere else at a good price, my monthly spending has dropped from around $600 a month to just under $400. (that's for groceries, clothes, cleaning supplies etc.)
Like you said if you take the time to pay attention to the sales, you can easily find better deals.
We just bought (2 months ago). We had 10% down. We got 4.85% on a 30 year fixed rate mortgage. We have a plan to pay the mortgage off early.
The real reason we bought though, wasn't the money. It probably would've made more financial sense to rent for a few more years.
The real reason was that we were moving to a new city for a new job, and we wanted to find a place to settle down in. We were and are willing to pay the premium to get that. We were tired of apartment living and wanted a place we could garden, and with a yard for our kids.
We easily afford the monthly payments, and even if we don't pay it off early, it's something worth spending on for us.
Everyone buys things that don't contribute to their financial well being, it's called enjoying your money. As long as you are meeting your financial responsibilities, I don't see a problem with that even if you are paying more for it than you would have otherwise.
Savings on one item from the Health/Beauty Dept pays for my membership every year. Otherwise, as I am shopping for 1 or 2 people, the groceries are usually not on the list, Frozen fish usually is. The roasted chicken always is - 3-4 lbs. chicken for $5 vs grocery store for scrawny 2 -2.5 lbs at $8. I do make storage room for toilet paper, paper towels and tissues. One does have to shop carefully and not succumb to impulse buys and it does pay off for us. I didn't think it would for just the 2 of us.
We refer to the free food samples as a 'New Jersey Buffet' -- from a Stephanie Plum novel by Evanovich.
We keep a warehouse membership for one reason, and one reason only. We're both on non-drowsy allergy medications, such as Zyrtec and Claritin. I can buy 180 tabs of store brand Zyrtec for around $22 at BJ's, which is far lower than I can get it elsewhere.
We could buy limited quantities of Zyrtec by shopping smart and using coupons and we MIGHT save a little more than at BJ's, but we wouldn't be able to buy enough to keep the household stocked regularly.
Same thing with stuff like Osteo Bi-Flex. The other day I scored 3 $5 off coupons by begging them off friends, and found it BOGO at Teeter, making one 40 count bottle only $3. HOWEVER - I take 2 per day and my husband takes 2 per day. So that $3 bottle lasts us 10 days. With my multiple trips (required to use coupons on each bottle due to HT BOGO/coupon policy) I was only able to get us a 30 day supply.
Whereas at BJ's it will cost more than the coupon-hunted price above but the cost for a much larger bottle is less than what the store's regular price. So I might go to a grocery store to take advantage of a really great sale, but for everyday use, I need to go to BJ's.
We currently have a Costco membership, but will be letting it expire in November because...
1) The more you spend the more you save. We've been being more frugal, which means we spend less. We don't shop enough to save as much money.
2) The best savings are on name-brand products. Buying cheerieos in a 1000 serving box is probably cheaper than the smaller boxes at the local grocery. Even cheaper though is buying offbrand imitations. We do buy some name brand things (Oreos!), but not enough to save a ton at Costco.
3) You save the least on staples. It seems like staples (flour, sugar, veg. oil, rice, beans) aren't as good of a deal as other items, and name brand really doesn't matter much with these items either. Since we've been cooking more, we just wait for bulk sales at the local grocery stores and buy then.