Author: Richard Williams

USALoansNearMe Direct Reduces Interest Rate to 4.5% APY

usaloansnearme logoIt was just announced that USALoansNearMe Direct is reducing the interest rate on its Online Savings Account from 5.05% to 4.50% APY. While not crippling I actually have enough money sitting in my savings account that I can see what affect the drop in the rates will do to the monthly interest I collect.

Last month i earned $174.12. The interest rate has basically gone done about 10% so I am going to miss out on about $17 in monthly interest in this account. Anyone who has a large number of 0% balance transfers is going to feel the sting more than me.

So what am I going to do differently? Probably not much. I am going to continue working to my savings goal for a house downpayment. I’ll still keep putting the money in my EmigrantDirect which is still paying 5.05% APY.

If interest rates continue falling I may be inclined to finance a higher amount of the house when we purchase it and lock into lower fixed interest rates. I could then take the extra money I saved and pay down a higher interest rate mortgage I have on one of the two rental properties.…

Read More
3 Cost Comparisons For Alternative Heating Sources

Winter has already hit some parts of this country and others are not far behind. With that brings cold weather and the need to heat our homes. Flipping the switch from off to heat, however, is a daunting choice for some folks because of the expense. But with a little investment and a lot of hard work, you can cut your heating bill from 50-100% and have a reliable heat source during power outages. Let me show you how.

1. Heating with a Wood Stove
We purchased our wood stove for $700 ten years ago. Today, the same stove sells for around $1,600. That might be a big investment for some folks, but take into account that it could pay for itself in one season. Also, you can still purchase a used stove for under $1,000. Before installing a woodstove, however, you will want to check with your homeowner’s insurance agent. They will want specific information about the stove for your policy. Our agent came to the house to take pictures for our file to show that it was installed properly.

Wood stoves have many advantages. With a glass front door, you have the beauty of a fire in your living room. You also have a warm spot to go to when you get chilled. But the best part is the cost over the long haul. In ten years of heating with wood, we’ve only bought firewood once. Otherwise, we have been allowed to cut downed trees from other’s property.

Even if you have to purchase your firewood, a cord only costs around $100. All in all, I estimate we’ve saved around $12,000 over a ten-year period by not using our electric radiant heat.

2. Heating with a Pellet Stove
Pellet stoves burn wood pellets. According to Home Depot’s Buying Guide for Wood and Wood Pellet Stoves, “wood pellets typically come from either mills as scrap wood, furniture manufacturers, recycling centers, roadside scraps, nuts, sawdust logging residue or paper packaging plants.” They are dried and pressed into shapes that resemble rabbit food.

A pellet stove looks and costs much the same as a wood-burning stove. A 40-pound bag of pellets runs about $4 in my area and lasts about a day. One source from western New York says they spend about $1,300 per year for wood pellets. Even though it costs a little more than burning wood, some folks prefer the pellet stove because it is cleaner than wood. If this interests you, check with the stove manufacturer.

Some pellet stoves will burn other things like corn, making it advantageous in case of a pellet shortage and cheaper for those who live in a farming community and can buy corn from their neighbor for cheap. However, since a pellet stove requires electricity to run the auger that feeds the pellets and the fan that blows the warm air, you cannot rely on them during a power outage.

3. Heating with a Coal Stove
Not as popular as the wood or wood pellet stoves, the coal stove is still a viable option for those wanting an alternative to the typical electric or fuel heat. You can purchase a coal-burning stove for around $1,000 that will also burn wood. And since the cost of coal is comparable to that of the wood pellets, it is not any more costly. Like the woodstove, you can purchase a coal stove with a cooking surface on top that makes it a life saver in times of power outages.

Final Thoughts
Some areas of the country have outlawed burning wood and coal due to the emissions. You will want to check with the municipality in which you live before purchasing a stove. Also, you will want to make sure that your stove is properly installed according to the manufacturer’s directions with the proper clearances. If you purchase a used stove without an owner’s manual, check with an authorized woodstove installer or your local fire marshal.…

Read More
Bigger and better hunt never ends

It’s difficult to capture the fundamental nature of the American consumer these days. Some of us are extremely thrifty, cutting coupons out of Sunday’s morning paper and splitting meals with our spouses at the local steakhouse. Others are freewheeling, fun-loving shoppers with lopsided balance sheets to show for it. We rack up thousands of dollars for the latest toys offered up by worldwide technology companies. We trade in our cars every three years for that latest shiny model on the showroom floor. Unfortunately, the younger generations had this search and replace, or upgrade, concept burned into their psyche at a very young age.

Blame cell phone providers and car companies. Auto leases, two-year cell phone contracts and six-month teaser rates from credit card companies have fostered a shortsighted financial view for most young people in America. We are constantly bombarded with advertisements reminding us that cell phones, computers and cars are outdated almost as soon as we open the box or drive off the lot. It use to be that people maximized the usable life of things before considering a replacement. “If it ain’t broke, don’t fix it” has been replaced by “If it ain’t new, get a newer one.”

Staying current is costly. As if the price of having new toys alone wasn’t enough to cause financial hardship, the fact that new toys (especially technology toys) are drastically cheaper just a few months later makes the idea of buying the latest and greatest even tougher to swallow. Consider the price of plasma televisions. When they first hit the market these things cost more than a compact car. Now, a decent model can be found for less than $2,000, still a lot for a television, but that’s another rant.  For the price of a mid-sized sedan you could take home one of Panasonic’s new 150-inch plasma televisions, which recently debuted at the 2020 Consumer Electronics Show.

It comes down to being content with what you have, not craving what you don’t have. Contentment is personal finance’s strongest ally, because if you have it you won’t feel the need to upgrade to new things just because it hit the shelves at Target. It is a safe bet that most people will not find anything wrong with their current household items until they hear about a new one. For instance, I own the original Xbox gaming system. I have exactly one game, the latest college football game from EA Sports. I play it a couple times a month and generally enjoy leading my favorite team to victory. When Xbox 360 hit the market I felt a strong pull to buy one. I read reviews about his faster processor and better graphics and was admittedly smitten. However, I had to stop and ask myself if I wanted the Xbox 360 because of its improved graphics, faster processor and newer game lineup, or simply because it was new.

In the end, I decided my original Xbox served me just fine. Months later I still have resisted the temptation to run out and upgrade, as I have done with several other major household items. Just as the “newness” of a product tends to wear off after a few months, so does the desire to own it if you resist that initial temptation.…

Read More
Getting braces: the real pain comes from the orthodontist’s bill

After a trip to the dentist this week we discovered my daughter’s overbite is causing damage to the backside of her upper, permanent teeth, and the schedule for her getting braces should be moved up. We had already consulted an orthodontist, but we all agreed she could wait until she was a little older (giving me a little extra time to save for the cost for braces).

Based on what our dentist advised, this is no longer an option. Obviously, the news doesn’t help my efforts to get out of debt and build a healthy emergency fund. Over the last day or two I’ve had time to digest the painful news and devise a plan of attack to cover the cost of braces for our daughter. After all, what parent wouldn’t sacrifice for straighter teeth and an improved bit?

The best way to eat an elephant is one bite at a time. At least that’s what all the personal productivity gurus tell us, right? The idea does have some merit, particularly in the area of personal finance. For instance, in the days immediately following the last-minute Christmas shopping hangover my wife and I agreed next year we would plan for Christmas expenditures instead of trying to cash flow them out of each paycheck from October to Christmas Eve.

We opened an online savings account and committed $25 a paycheck (biweekly) be diverted to that dedicated “Christmas Club” account. We plan to take the same approach to getting braces, only the dollar amounts will be significantly higher and I’ll have to come up with a more foreboding name than “Club” to attach to the ledger identification. This was the option we settled on, but there other strategies we strongly considered.


Our first thought was to fund the cost of braces using our flexible spending account at my employer. This might still be an option, but I had three reservations. First, I would need to investigate the IRS regulations to determine if orthodontics were covered as an FSA-eligible expenditure.

Second, our FSA is tied to a debit card and all charges must be run through that system. I planned to do some negotiating with the orthodontist using cold hard cash. Thirty Benjamin Franklins laying across the table look a lot better than a Mastercard debit card when trying to broker a discount.

Finally, agreeing to have $150 deducted from each of my twenty-six paychecks would cause a significant hit to the monthly budget. Of course, one could make the argument that I’ll have to set up the deductions to some sort of savings vehicle anyway, so why not get the tax deduction associated with creating a pre-tax flexible spending account. Good point.

We could finance the cost for orthodontics directly from the orthodontist. This discussion didn’t get very far because my wife and I are committed to taking on no new debts, even for braces. Putting the braces on a credit card, taking out a loan, or using the orthodontists in-house financing just did not appeal to us.

In the end it appears saving biweekly amounts in our online savings account fits best with our current financial strategies (keep it simple, no new debt!). Like other decisions we’ve made with finances, it may not make the most sense mathematically, but it makes the most sense personally. That’s why they call it personal finance.…

Read More
Perfect credit score not estimator of true wealth

credit scoreIt looks like Fair Isaac is reacting to this recent lending debacle by improving on its formula for creating the almighty FICO score.  Habitual late-payers will see their credit score more heavily penalized, while those of us with the occasional 1-30 day late payment will be spared a few points to the negative.  Of course all this reprogramming isn’t being done for your benefit; it is for the benefit of lenders whose bottom lines were eaten alive by sub-prime customers.


What do the changes mean for you? Unless you plan to run out and acquire new debt, probably not much.  The changes do emphasize the need to implement your debt snowball plan and start paying things off quickly.  Those with higher credit limit utilization (balance to credit limit ratio) will be hit harder in the FICO 08 scoring model, so it pays to drive those high balances down lower.

No more piggyback rides allowed. This may be one of the only positives out of the new FICO changes.  Previously, people listed as “authorized users” still got benefits of having a good credit line, even though they were not financially responsible for the account.

Many of those late-night credit repair crooks used this technique to improve scores.  They would pay a person with good credit to add someone with lousy credit as an authorized user (of course, Lousy never got a card or the number).  By virtue of being paired up with Mr. Credit Pimp and his perfect credit score, Lousy saw her credit score increase.  Under the new model only an account’s applicant or co-applicant will have their credit score impacted by account activity.


FICO has really dumbed down the financial industry. I guess in some ways FICO has helped to prevent discriminatory lending practices (after all, it’s just a number, not a sex, race, or age).  However, the negatives far outweigh the positives in my opinion.

Banks used to consider how long someone was on the job, or whether or not they paid their landlord on time, when considering lending money.  An employer would use interviews and a firm-handshake-test to determine if someone was trustworthy.  I remember when I worked in a new credit department of a large financial firm the only things that mattered on an application where FICO and income.

These days we look down on people with poor credit scores and exalt those with a perfect credit score in the 800′s. Can you imagine the personals in only a few years?  Male 6’3″/220lbs/760 FICO seeking Female in the 720-760 range.

Wanna see how you measure up? Check out to check your current credit score.

Read More