FTPH: Holiday Gratitude

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Dear Cheddar,

Don’t you just hate winter? It’s cold and dark and the holidays are the WORST. I hate spending so much money and my family drives me crazy!

Everyone Else

Dear Everyone,

Au contraire, my friend, I love this time of year — here in the Northwest, it’s cold, rainy, wet, and glorious. From Halloween to New Year’s Day, I get such a warm and cozy feeling from the food, the cheer, and spending time with people I love. Sure, there are occasional holiday stresses, but for the most part, I’ve found a good balance of being able to make time for myself, celebrate with loved ones in ways that don’t feel forced, and frugalize my gift giving in ways that don’t detract from the generous spirit of the season. I get along with my and Sweetie Pie’s families, find a strange amount of joy in decorating my Christmas tree, and love the extra snuggle time I get with Cheddar Pup. And there is nothing like a good cup of tea with a Youtube Yule Log.

I hope you all find similar warmth in your holiday celebrations wherever they may take you! Thanks for reading and for encouraging me to keep up with this blog. It’s been a fun year.

Love,

Cheddar

FTPH: Lost, Annoyed, and Bored by Investing

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Dear Cheddar,

You know what I hate the most? Trying to figure out how to allocate my retirement investments. I know some of the basics about retirement: I’m comfortable with a considerable amount of risk/aggressiveness at this point, I put quite a significant percentage of my income into retirement pre-tax, I also have a Roth and max that out every year. But when it comes to choosing the funds where my money should sit, I am lost. And annoyed. And bored. Is this conversation over yet?

I have tried to figure it out, I’ve talked to a complimentary advisor my financial institution provides, I have bribed myself with rewards like wine or chocolate for doing the necessary research on funds, I am sort of familiar with the online tools. But my money is still strewn around funds haphazardly, because for some reason this is the most tedious subject in the history of the universe to me.

How do you choose funds wisely? What are the most important indicators to look at? Is it worth paying someone and what do these people even charge? I know the socially conscious funds aren’t necessarily as progressive as I might hope, but I do hate guns; how do I choose a good socially conscious fund? Will you send me a reward if I get my act together and allocate better?

Sincerely,

Maybe I Just Need More Chocolate

Dear Chocolate,

Congratulations! You are doing amazing things! You are saving for retirement, max out your Roth every year, think about where to put your money, and ask great questions! You know what? You are beating 143% of the people out there who are not saving for retirement, and that is a statistically accurate fact. Continue reading FTPH: Lost, Annoyed, and Bored by Investing

FTPH: Early Mortgage Payoff

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Dear Cheddar,

I know you are working hard to pay off your mortgage early. How does that work? If we make extra payments on our mortgage, how do we ensure they go towards principal and not just interest?

Sincerely,

Interest Really Killing Early-Retirement Dreams

Dear IRKED,

What a great question! You are wise to be thinking about paying off your mortgage early. Even with today’s “SUPER! SO LOW! UNBELIEVABLE!” interest rates, interest payments add up quickly and can almost double your costs over the term of the load. For example, a $200,000 loan at 4% interest adds up to $144,000 in interest over 30 years. As Cheddar Pops would say, that’s nothing to sneeze at! If you add just $100 extra to every payment, that total drops to $116,000 and your mortgage will be paid off in 25, not 30, years. Pretty cool, huh? You can also make one-time lump sum payments, which is a great use for any windfalls you might receive such as a bonus or inheritance.

How you go about your early payoff will depend a bit on how your lender structures your payments. Your first step should be to confirm that your mortgage does not include a pre-payment penalty — almost none do nowadays, but it doesn’t hurt to double check. Such a provision would allow the lender to charge you extra to pay off your mortgage, negating the cost savings of the early payoff.

After that, depending on your lender’s procedures, you should be able to (1) mail a check with “Principal Curtailment Only” in the memo line; (2) make an online payment and select an option for “Additional Principal” or something similar; or (3) call your lender and make a transfer over the phone, specifying that the payment should be applied only to principal. Make sure you also cover any interest payments that are due at the same time; paying off your principal early does not excuse you from your interest obligations!

If you accidentally make an early payment (as I once did!) as opposed to an additional principal payment, you’ll just end up a month ahead on your payments — your overall interest will not be reduced. So you are right to be thinking about the mechanics of early payoff and how to make sure your lender flags any payments appropriately.

Good luck in your journey, and keep an eye out for some more posts on mortgages and Home Buying 101 to come!

Loves,

Cheddar

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FTPH: Cutting the Cord

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Dear Cheddar,

I’m moving into a new place and finally want to live without cable but still be able to watch TV. Help! What are my options?

Real Reader Who May or May Not Be Your Sister

Dear Sister,

How exciting! Congratulations on your move. As you know, I consider myself something of an expert in living without cable while still successfully maintaining a robust couch potato lifestyle. I haven’t had cable since 2005 (take that, Worst Company in America!). Here are some options, in no particular order:

Hulu is my go-to for current TV. It offers a selection of non-premium (i.e., not HBO/Showtime) TV shows and some less-than-awesome movies. You can watch the most recent handful of episodes for free without and account. An account gives you full access to past episodes and costs $8/month. There are ad breaks that can get annoyingly repetitive, but I find them a good opportunity to get up and get some exercise by refilling the popcorn bowl.

Netflix is a good choice for a better selection of movies and original programming (like House of Cards). They seem to have separated their streaming and DVD-by-mail services now, which is an annoying because DVDs would still be a good option for saving some of your literal bandwidth (magical internet streaming power). Plans for either DVDs or streaming are about $9/month with the first month free.

Amazon Prime is also a good choice for movies and they are starting to break into original programming (like the excellent show Transparent). It is $99/year (so cheaper than Netflix and slightly more than Hulu), and includes free two-day shipping from Amazon.com, unlimited Prime Instant Video, and books from the Kindle lending library. The Prime video selection is okay, not great, but they have a fantastic selection of shows and movies that you can pay ($2-$10) to rent. When you buy items on Amazon, you can select to NOT receive expedited two-day shipping and get a $1 credit that you can then use to rent digital content. If you shop on Amazon a lot, this is a great deal — they also offer a free 30-day trial if you want to try it on for size before committing.

HBO Now (or what I like to call the Game of Thrones channel) is the recently launched a la carte sister service to HBO Go (which has been available to Comcast subscribers for a while now). Currently it’s only available if you have an iPhone, iPad, or Apple TV but they say it’s coming soon to Android and Chromecast. It’s $15/month and provides full access to HBO programming. I don’t have an i-anything (I do have a MacBook Pro, but for whatever reason that’s not good enough?) so I haven’t been able to test drive this yet, but I am so happy to see companies like HBO realizing that there are many customers like me who will pay a premium to be able to watch their shows without having to deal with the annoyances of cable.

What do I do? I have Amazon Prime and Hulu for a total of about $175/year (my Prime subscription is at the earlier rate of $79/year). My internet cost is about $60/month (split four ways), so all together it works out to $895/year or about $75/month (for me it’s about $30 a month including the Roommate Discount). I usually suspend my Hulu for the summer months, so the total ends up being a bit cheaper — it’s still a lot, but a far cry from cable! I’d be paying for internet service anyway and the benefits of Amazon Prime extend well beyond digital content.

So how do you actually WATCH these?

With the exception of HBO Now, you can watch any of these on your laptop or desktop computer by visiting the relevant website. The free version of Hulu does not require logging in.

There are a variety of other dongles and doohickies you can get to stream straight to your TV rather than a computer. I avoid acquiring extra unnecessary electronics like the plague, but will admit that I have the Amazon Fire Stick and really love it. You pay for the stick (about $35), but then there is no ongoing cost. Similar devices that I haven’t tried are the Fire TV ($99), Apple TV ($69), and Chromecast ($35). There are also ways to stream through gaming devices (xbox, PS4 thingies?), but how that works is beyond my free blogger pay grade.

All of these devices will run off your home WiFi, so if you are making the switch from cable to streaming for the first time, you may want to upgrade your Internet service to a faster speed so that they will actually work seamlessly without stutters. Depending on what area of the country you live in, this may mean you can’t completely escape the cable demons. ¯\_(ツ)_/¯

Loves,

Cheddar

P.S., dear Readers, if you have more options to add to this list, please add them in the comments or email me and I’ll update this post accordingly. 

Have a question for the Pie Hole? Email me