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On Monday I began my trek into the all cash world. I must say that I have been doing well so far. I definitely feel a little bit more pain when I slide that cold hard cash across the counter than when I simply swiped my debit card. When you use your debit card you don’t see the money coming out, but with cash you definitely do. As you may remember, I decided to take out $120 each week. Whatever is left over I put back in.

Here is how I have fared.

• $1 for a banana for lunch.
• $16 for a haircut kit
• $7 for an extension cord

I feel good about these purchases because they were all justified.  I forgot to bring my banana to work for lunch, so I bought a replacement one. It actually cost me $.55, but I don’t consider coins to be money, so I just round up. I am going to keep all of my coin in a jar and then bring it into the counter every so often. I just need a jar. Right now it is sitting on my desk.

I think that the haircut kit was extremely justified. If you go to Hair Masters a cut will run you $15-$17 plus a few bucks for tip. Even after all that I am still not completely happy with it. It probably doesn’t help that I have a 50/50 chance of getting someone who uses English as their primary language. Maybe it is just me, but I find slight discomfort in not knowing whether or not my hairdresser actually knows what I want. Typically I just hope for the best. So the haircut kit cost the same amount that a haircut from a professional would have cost. The kit has already paid for itself! What a deal! I’m definitely not a pro, but it turned out only a half notch below what Hair Masters would have given me. Throw a little gel in there, and you won’t be able to tell the difference.

The extension cord was a necessary purchase because for some reason we do not have any outlets in the bathroom. I cut my hair in the bathroom, so I needed a place to plug the clippers in. The extension cord solved this problem nicely.

I’ve spent $24 so far so that leaves me with $96 for the weekend. The goal is to not spend it all. We shall see.

Today is May 15th, and most coin collecting enthusiasts should recognize today as the day that the latest edition of the Presidential Dollar Coin Series gets released to the public. We have actually had these coins sitting in our vault for a week or so now, but we were not allowed to give them out to the public until the 15th. Let the feeding frenzy begin! This is the sixth coin in the Presidential Series that began in 2007.

It may be interesting to note that John Quincy Adams was the son of the second President, John Adams. Quincy Adams only served one term in office, but later went to serve nine terms in the US House of Representatives. He and Andrew Johnson are the only two Presidents to have done this.

On May 19th, 1828, Quincy Adams set forth a Coinage Legislation that provided the following according to the US Mint:

• directs the location of the United States Mint to remain in Philadelphia indefinitely;
• establishes a standard weight for the Mint’s use;
• makes provisions for payment for the testing of silver bullion brought to the Mint for coinage;
• authorizes employment of clerks at the Mint; and
• authorizes the Director of the Mint to assay bullion not intended for coinage and to issue certificates of fineness at the owners’ expense.

You can read the Act in its’ original form here.

Believe it or not, the US Mint has a presidential dollar coin screensaver. You can download this here. The download comes in .zip format from the US Mint website so you know that it is safe.

A recent article in the Seattle P-I written by Andrea James reports that Starbucks has announced that they are going to start selling smoothies in their coffee shops. “In April, Seattle-based Starbucks Corp. said that it hopes to expand its customer base by serving blended fruit and protein beverages, energy drinks and healthy foods.” While this may seem to be a deviation from their current business plan, it may be interesting to note that “Jamba Juice got its start with the help of Starbucks Chief Executive Howard Schultz, who was an original investor and had served as board member of the company.” To date, Jamba Juice has grown to over 700 stores.

Although Schultz helped to start Jamba Juice, I don’t really see how smoothies fit in with his remake of the company. It always seemed to me that Shultz’s goal was to bring Starbucks back to the vibe it had 15 years ago when it was still a smaller company trying to make it big. He got rid of the delicious breakfast sandwiches because they were overpowering the aroma of the coffee. It would seem like each individual Starbucks would need a lot more room in order to accommodate a smoothie bar as well. Wouldn’t this also take away from the romance and niche of the coffee bar? I guess we will see.

I recently decided that I need to adjust my money management strategy. As you may have read in my previous post, I was attempting to find a new institution that had more convenient access. Turns out though my bank has partnered with some other banks ton increase its’ ATM network. That works out nicely for me, because with my new strategy I will be using the ATM a little more often.

So here is my new money management plan:

• Each Monday I will take $120 out of the ATM (equates to $500/month).
• I will use only that money for my weekly expenditures.
• The left over money will be put back in on Monday, and an additional $120 will be taken out.
• All coin will be collected in a coin jar to be counted at a later date.

This new strategy should allow me to better manage my money, since I will be able to physically see what I have spent and what I have left. I have always found it a lot harder to spend with cash than with my debit or credit cards. I am going to make a few exceptions for things that I don’t spend cash on:

• Rent
• Cell Phone
• Utilities
• Gas
• Gym Dues
• Car Insurance

These items will either be paid by check or automatic transfer. This should theoretically work out for me. I will keep my current status posted each week. I plan on documenting what I spent each week and whether or not I met my goal.

I have always been an active saver, but it is always good to save a little extra. Each month I transfer $416 to my Roth IRA in order to maximize my yearly contribution. I haven’t been at my job long enough to qualify for their 401k program, but once I do I will switch my contributions to them in order to maximize my employer’s matching policy. I also transfer $50 per week into an online savings account. This allows me to save the money before I even see it. That way I am not tempted to spend it. So far it has worked well. I am just afraid that I am spending more than I have left over, which is why I have switched to this savings strategy.

I’d be interested to hear how anyone else who has tried this strategy has fared. All comments welcomed.

I have decided that I am going to open a savings account at a new financial institution. There a few reasons that I am going to do this. The first reason is that my current financial institution is too far away for me to use on a consistent basis. It doesn’t make a whole lot of sense for me to drive the 21 miles round trip to make a deposit there. That’s about a 40 minute trip to the bank and back. This bank is directly north of Seattle, and I hardly ever travel north of the city. This makes it especially inconvenient because I have to make a special trip to the bank just to take care of my business. With gas as expensive as it is, it is almost worth taking a hit on the ATM fees just to avoid the trip.

Instead of take the hit on the ATM fees, I figured that I would just open a regular savings account with ATM access at an institution that is located down town. This would help me in my new savings strategy. My new savings strategy is cash only. The plan is to transfer somewhere between $100-$150 a week from my current checking account to this new one. At the end of the week I would put back any cash that I didn’t use and then take out an additional $100-$150 for the next week.

I went downtown today to look at a few different institutions. The one that I was thinking about going with, Washington Federal Savings, did not have an ATM outside their building, so that pretty much defeated the purpose of joining them. Next, I went to Evergreen Bank, but they require you to have a $300 minimum balance in their savings in order to avoid the $8 fee. That didn’t sound like much fun to me, so I decided not to sign up for either one.

So I didn’t accomplish my mission, but here comes the ironic part. When I got home today I had my monthly statement waiting for me from my institution. When I opened it up there was a flyer inside of it. I assumed it was your typical refinance your loan flyer. When I took a closer look I found that it was an advertisement for a service called MoneyPass. MoneyPass is an ATM service that many banks have begun to use in order to expand their ATM network. The best thing about MoneyPass is that it is FREE! In downtown Seattle, the banks that are a part of this network are US Bank, Watermark Credit Union, and Northern Trust. Based on punching in a few random zip codes around the area, it seems like US Bank is the only major bank that uses the MoneyPass network, and the rest are small institutions.

This is the first time that I have heard of MoneyPass and if it becomes as popular as I think it will, I imagine people will start to see it around a little more often. It is a great idea and a no brainer for people who have been paying $2-$3 per transaction. According to the MoneyPass website, these are the main benefits to their service:

• No surcharge at ATMs that participate in MoneyPass
• Access to thousands of ATMs across the nation
• Convenient, accessible locations that include bank and credit union branches, convenience stores, grocery stores, restaurants, discount retailers and many more

I checked a book out from the library a few weeks ago called “Green Investing” by Jack Uldrich. When checking out this book I was hoping to find some ideas on companies that were in the business of producing environmentally friendly products and services. This book was full of good information on that subject.

The book was divided into nine different chapters. Each chapter discussed different companies within a certain part of the “green industries.” To better make my point, the following is a list of chapters in the book:

1. Green Investing: A Long-Term Trend
2. Due Diligence: Do Your Homework
3. The Big Dogs: The Fortune 500 Companies
4. Biofuels: Fuel of the Future?
5. Solar: Heating up or Flaming Out?
6. Wind Power: The Sky is the Limit
7. “Alternative” Alternative Energies: Geothermal, Fuel Cells, Wave Power, & Clean Coal
8. The Cleanest form of Energy: Energy Conservation
9. Tracking Cleantech and Building Your Own Cleantech Mutual Fund.

In each of the main chapters, Uldrich gives an extensive list of the companies that are poised to excel in this field. He gives the trading symbol and market (if applicable) for each company. He also gives a website as well. Each company also receives a short description, reasons to be bullish, reasons to be bearish, what to watch for, and a conclusion.

It is nice that Uldrich has done all the hard work for you. He has weeded out the bad companies so that you can focus more of your time on the good ones. This book was published in 2008, so it is very up to date.

One thing that I did not like about the book was that there were a decent amount of companies that were either private companies, or could only be traded in foreign markets. To me, it would be hard to invest in either a private company or one that only traded on a foreign market. I guess if you have the money to invest you can probably find a way though.

In conclusion, I think this book is an excellent primer to the world of green investing. Uldrich has done most of the hard work for you. Now, the investor only needs to find a company that they like and decide if it is worth investing in.

Living in a state that borders Canada, it is not uncommon to see many Canadian license plates as you drive around. Lately though, it seems like I have seen an increasing amount of Canadian license plates. Last week I was shopping at a local outlet mall and I noticed that about every other car had a Canadian license plate.

There are a couple of factors that contribute to the increase in Canadian visitors to our state.

1. Their dollar has reached parity with ours, and we sell many things for cheaper prices than they would find in their homeland.
2. Our state has much lower sales taxes, thus lowering the purchase price.
3. Not all American brands are sold in Canada.

I am not the only person who has noticed this. In a recent article in the Bellingham Herald by Dave Gallagher (Bellingham is about 20 miles from the Canadian border), they state that “we have the Canadians to thank for strong retail sales numbers during the holiday shopping season.” In college I worked at a restaurant that was near the mall (2004-2007), and observed each weekend the large number of Canadians that would come in to eat after they were done shopping for the day. In December of 2006, the exchange rate hovered around $1.15 CAD per $1 USD. Back then there were a lot of Canadian shoppers. Today the two currencies are as close to equal as you could possibly get. Today’s prices are about a 13% decrease from what they were a year and a half ago for them.

The closer a town is to the border, the greater the increase in total sales were. “While the state average increase (in sales) was just 2.7 percent, Bellingham was up 7.4 percent. The border towns of Blaine (up 12 percent), Lynden (up 12.8 percent) and Sumas (up 18.2 percent) saw a big boost in sales during the holiday season.” For those not familiar with the area of Northwest Washington, the towns of Blaine, Lynden and Sumas are not very large at all, and are definitely not considered “shopping destinations.” I feel that a major reason that sales in those towns rose so much was because Canadians were driving across the border to fill up on the cheaper gas. According to the article, “The price of gas in Canada is around $1.19 a liter, or $4.50 a gallon.” While Whatcom county typically has the highest gas prices in the state, these prices are at least $.50/gallon cheaper than our neighbors to the north pay.

Any theories on how low the dollar will go against the Canadian dollar this year? My guess is $1 USD = $.85 CAD. This is not based on any intense calculation of any sort. This is just a hunch.

Here is a thumbnail of what Whatcom county looks like so that you can see the relationship between these border towns and Canada. This image was obtained from dickmartin.com.

As an employee of a financial institution I have the ability to view prospective member’s credit reports. It is amazing how many people are in collections from the library. Did you know that not repaying that nominal library charge for turning in your books is actually hurting your credit scores? What do you think lenders think when they see that you have been in collections with the library for the past two years over an $80 fee? If you can’t repay the library (who lets you read their books for free), why would you repay your normal debts at an institution?

Before you decide to not pay your library fee out of principle, remember that potential creditors have the ability to see this and it will hurt your credit score. Lower credit scores equate to higher rates on your loans. You will easily pay over $80 in additional interest with a higher rate loan. Do the smart thing, pay off your library fees because they may come back to haunt you.

When I was at the gym this evening I saw a story on the TV about a proposed “Gas Tax Holiday” for the summer driving season. Since I was too far away to read the subtitles I looked into it a bit once I got home. I found a nice article written by Nick Timiraos of the Wall Street Journal.

In the article titled “Will Voters Accept Obama’s Gas Plea?” we learn that Senator John McCain has proposed an elimination of the Federal Gas Tax from Memorial Day to Labor day. This would eliminate the 18.4 cent per gallon tax on unleaded fuel. Senator Hillary Clinton also supports this proposal. Senator Obama decided to take the rational approach and oppose this “holiday.”

The article suggests that Obama’s choice to oppose this tax relief act should put him in a “politically treacherous position.” The main reason for him being in troubled waters is because US consumers are fed up with high gas prices. The fact that he opposed a reduction in the price of gas could cause many people who were going to vote for him to vote for someone else.

This image was linked from opentravelinfo.com.

Politically, this move by McCain and Clinton is genius. At an average price of $3.60/gallon, the discount only amounts to a little over 5%. In reality that isn’t much to brag about, but the average person doesn’t look at it this way. To put this in simpler terms, in order for someone to save $100 in gas during this time period they would have to consume 543 gallons of fuel. At an average rate of 20 mpg, one would have to drive 10,860 miles over this three month span. If you annualized this mileage, it would be a pace of 43,440 miles for the year! Most leases penalize you if you drive over 36,000 miles over the course of three years!

“Obama has been positioning himself as a candidate who can win by telling voters hard truths rather than offering easy political solutions.” The easy political solution is to cut taxes for a short while to make consumers happy. In the end, a Gas Tax Holiday may be even more detrimental to the price of gasoline. In advertisements to Indiana and North Carolina voters, Obama makes the lack of savings crystal clear to voters. “You’re going to save about $25, $30, or half a tank of gas.” Although this doesn’t quite seem right, don’t forget to take my $100 in savings equation into consideration and then do the math. The savings are few and far between.

The only problem with Obama’s claim is that the average voter will likely think that they are saving a lot at the pump each time, but in the end this will not be the case entirely. When the price goes down by the amount of the tax, people will start to believe that gas has become much cheaper to them. As they think this, they will be more inclined to purchase even more gas. If the supply of gasoline is held at a constant rate and demand increases, then prices will naturally rise in order to reach equilibrium. This rise in price should offset whatever savings the consumer felt that they had saved from the lower prices.

One major option to reduce the amount of gas consumed each day is to increase gas taxes. The increase in taxes will raise the prices, and will cause demand to be reduced. Of course, no politician could ever run on the platform of increasing the gas tax by exorbitant amounts. That would eliminate any chance whatsoever of being elected.

In my opinion, something must be done to help wean the US off of our gasoline addiction. I believe that higher gas taxes, and/or increased toll roads would help promote more awareness on the issue. The funds from these taxes would be used to fund more mass transit options rather than improving existing roadways.

It should be interesting to see how the public reacts about Obama going the opposite direction on such a delicate issue such as this. A poll found in the New York Times shows just how the nation feels about gas taxes. It is obvious that Americans think wallet first, environment second.

I recently finished reading another book from the Seattle Public Library titled “What No One Ever Tells You About Investing in Real Estate” by Robert J Hill. As someone who would very much like to invest in real estate some day, I felt that this would be an interesting read. For the most part is was an interesting read. I would call it entertaining and informative.

This book, written by Robert J Hill, Esq, tells about many different real life situations that have happened to real life real estate investors. Some are horror stories that would make you never want to consider purchasing a home. Others give you a real life example of why you might want to purchase title insurance or any other product along those lines. Robert also threw enough real estate successes in there to convince you that maybe real estate investing could be the thing for you.

In this book , the author uses “real-life advice from 101 successful investors” to tell 112 different stories of things that they have had go right or wrong. Many of these stories came as submissions from his website realestatestories.com. Essentially, the author summarized the stories that the investors had given him, and then added his own personal comments and commentary. This made this book a very easy read. Because of the way the book is laid out with all the different stories, it makes it so that one can easily just pick it up and start reading right away without any need to refresh their memory.

Overall I really enjoyed this book. It was something that I could easily just pick up at any time and start reading. The author also put many major examples that clearly show that real estate investing can have some major pitfalls and is not all fun and games. I would highly recommend this book to someone who is thinking about getting into real estate investing, but doesn’t have the time to read a giant instruction manual. I feel my time was well spent reading this book.