Not only are we into spending wisely and saving money, but we are also into saving the environment. Unfortunately, I don’t see how fancy biodegradable bags do either. For those of you that live in areas with community composting or yard/food waste pickup, you need some sort of of biodegradable bag to put your food scraps in.
You can buy 125 of these for $12.99 + tax from Costco. This works out to about $0.11 a bag. Or you could buy them from Amazon at about $0.15 a bag. Either way this is a whole lot more expensive than the free brown paper bags you get at the grocery store.
Spare yourself remembering the “environmentally sustainable” canvas or recycled plastic bags (which you should wash frequently, by the way) and use the free paper bags for biodegradable compost and paper recycling.
A tricky part of living below your means is knowing a good value when you see one. Recently we ran a Frugal Fail about McDonald’s $1 Sweet Tea, and how buying drinks out daily was a great way to spend a lot of money on something that didn’t have much worth. Of course, just a few weeks earlier, we had posted that McDonald’s $1 sodas were a good value relative to buying a soda at a convenience store.
What gives? Are we hypocrites? Contradicting ourselves?
Not really. Our philosophy is that money is a tool that one uses to achieve happiness, and you have to know what makes you happy in order to use it properly. Otherwise, living within a budget is just a grind. In other words, something is only a good value if it is worth it TO YOU.
If 95% of the time you don’t spend a lot of money on drinks, then the $1 McDonald’s soda is a pretty good deal, especially if you compare it to the $1.69 to $2.99 that you’re going to pay in a convenience store. The $3-$4 drink at coffee shop with a few friends on a Saturday afternoon is a great way to spend some time in a pleasant atmosphere (especially if you consider the number of hours of enjoyment you are getting from the experience). But if you’re spending that kind of money most days on drinks — especially the kind you bring back to your desk and hardly notice that you’re drinking — then it’s likely you’ve gone from spending your money on something that makes you truly happy, and paying an awful lot of money to avoid brewing your own coffee or tea and putting it in a thermos in the morning, or remembering to grab a soda out of the fridge to drink later in the day.
Now, there is also the argument to be made that you are paying for convenience. Understanding the value of convenience is a great subject for living richly, and we’ll be exploring that question next week.
Driving today I heard a McDonald’s ad on the radio. In it, a guy decides that since he’s “smart enough to get a sweet tea for just a dollar” he is also smart enough to build a gazebo. His female companion points out that he’s building it upside down, and the guy sheepishly agrees to call the “gazebo guy.”
He should have called his 2nd grade math teacher.
Drinks (alcoholic or otherwise) are one of the most overpriced things you can get in a restaurant. Now, I’m all for going to the bar with friends, or treating the family to a dinner out every now and then, but nobody should be excited about the “deal” they are getting. For about $16 you can get a bucket of Lipton Iced Tea Sugar Sweetened Iced Tea Mix (Pack of 2) that makes 56 quarts or about 14 gallons of tea, which is enough for 56 large 32-oz servings of McDonald’s tea. In other words, you can get the same serving for about $0.20 cents at home and the McDonald’s “deal” is 5x the cost.
Amazingly, the $1 tea from MickeyD’s isn’t the biggest rip off in tea … For $6.98 at Buy.com, you can get a packet of 10 instant tea mix packets. That’s $.69/glass, IF you make them at home. But the marketing guys show a bottle of water on the box, which will set you back another $1 – $2 at the convenience store. That’s somewhere between $1.69 and $2.69 for a glass of tea.
We recommend you get a high quality portable thermos. Personally, I use a Contigo West Loop Mug that will keep a cup of coffee hot, or a refrigerated drink cold, literally all day. Using it means I’m NOT spending $1-$4 a day on drinks, depending on what I’m not buying (coffee, soda, or just plain water). That might not sound like much, but over the course of a month (workdays only) it can add up to $20 – $80. Let’s call it $50/month or $600/year that I can either invest or spend on things that really matter to me. I think that’s better than spending $20 a month for 20 glasses of tea.
Just for fun, here is a video of tea being made at McDonald’s:
If this is how trickle-down economics is supposed to work, I fear for the future. With the distance between the haves and have-nots at historic highs, unemployment rising the world over, governments falling across the Middle East, protests and riots in Spain, Greece, and others EU countries, and banks the world over continuing to be bailed out on the backs of tax payers; it pains me to see the extremely well-to-do spending $131k for a hat. It bugs me even more that everyone seems to be placated by the fact that “the proceeds go to charity”. Well, la-de-da!
CNN reports on the sale here. The CNN video bit cheerfully ends with – “So much fun to be had, for such a great cause“. This is probably what a CNN anchor would have said had they been reporting on a party hosted by Marie Antoinette.
I am a strong believer in free markets, private wealth creation and the ability of those with wealth to enjoy themselves. However, bit of tact and social awareness never hurt anybody.
Last month, I replaced my cable modem with a new Motorola SURFBoard 6120 (the same one that I would have rented from Comcast). I did this because I wanted to take advantage of the new speeds offered in my area and my old DOCSIS 2.0 modem could not handle them. This and a note from my sister-in-law, reminded of how great of a deal it was to own your own modem instead of rent one.
The following table shows how much money I saved by buying my cable modem 6 years ago. When I first decided to buy my modem, the rental rate was approximately $3 plus tax. I purchased my modem online, used it for 6 years and then was able to re-sell it on Craig’s List for $25. Over that time, Comcast raised the rental rates twice.
If I use the same projections, and even assume the monthly rate will never rise (unlikely), I can see that I can expect to save even more money over the next 5 to 6 years after upgrading:
The main reasons Comcast and others say you should rent from them are as follows:
If it breaks, we will replace it
You are future proofed, as you get free upgrades as the technology improves
Both of these reasons are ridiculous, but let’s address them one by one.
First, “if it breaks, we will replace it”. This is simply another way of paying overpriced insurance you don’t need. Cable modems have no moving parts, this means that their failure rate overtime is very low and that most failures are electrical and will happen within the first year. New modems typically include a 1 to 3 year warranty and as such, paying hundreds of dollars to “insure” your cable modem is simply a huge waste of money. Regardless, at approximately $7 to $10 a month in rental fees, even if you have to buy a new modem every year, it is still cheaper to buy than rent one from Comcast.
Second, “you are future proofed and get free upgrades”. Obviously, since you are paying hundreds more for the privilege of “free” upgrades, the upgrades are anything but “free”. More importantly, it is critical to know that the standards that cable modems follow known as DOCSIS are only updated every 4 to 6 years. Once new standards are released, it takes cable operators another 1 to 4 years to fully adopt them and phase out the old standard. This means that if you buy a modern DOCSIS 3.0 cable modem today, you can expect that this standard will be supported for at least another 5 to 10 years. To add to this, the current DOCSIS 3.0 standard actually supports speeds many times faster than what the average home internet plan offers, this means that it may take even longer for DOCSIS 4.0 to come out and be adapted than previous versions.
If you are concerned that buying and installing your own cable modem will be hard, don’t be. The steps are very simple:
Buy your new cable modem, I recommend going with the Motorola SURFBoard 6120, as it is pretty much the standard by which others are measured.
Un-box it, and plugin 3 wires:
Ethernet line to your computer or router
Call Comcast or your cable company and tell them you have a new cable modem you just bought. They will ask you for some numbers on the box and then they will configure it remotely.
Return your old modem to Comcast or your cable provider and start saving money.
For another related frugal fail, consider the somewhat dated story of the widow that paid thousands to rent a rotary phone. However, before you start to laugh, remember if you are currently renting your cable or DSL modem, you are in the same boat.
Why does Claritin cost so much? The battle over generic vs. non-generic medicines has been going on for years. However, there is a pretty good consensus that as long as the medicines are chemically identical or at least within a FDA acceptable bioequivalent range, there is no medical reason not to go with the generic.
Brand loyalty and quality or safety concerns of course can override the science. For this reason as an example, some people would still prefer to get Advil instead of generic Costco brand Ibuprofen even if they have to pay a premium. But the premium for this “peace of mind” is typically priced around 2 or 3 times the price. In this example,360 Advil 200MG tablets at $0.046 each vs. 500 Kirkland 200MG tablets at $0.018 each. Since we believe in spending money where it matters and saving where it doesn’t, we would probably save the $9 and get the Kirkland brand. However, even if you didn’t the premium for the name brand is “only” 2.5X.
Claritin’s pricing over generics however is anything but typical. With Clartin 10MG tablets in a 90 pack you are going to pay $0.388 for each tablet vs. the 360 tablet Costco Kirkland brand price of $0.035 per tablet. This equates to an insultingly high 11X premium to go with the non-generic. Since Costco is able to produce, package, ship and sell the tablets at $0.035 each and still make a profit (probably about 0.01 per tablet), paying more for Claritin means you are simply generously giving them $0.363 profit per pill (assuming the same costs to serve). That’s just nuts.
Our recommendation, stick with the generics… especially for Loratadine.
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