Friday, November 10, 2006

Free $100 (or More!) Gas Cash-Back Certificate for Citi Cardholders

Author: Nick
Category: Money
Topics: ,

ma tank be full o gas now, hee hee

One great way to get my attention (and maybe a shoutout on this here website) is to do something that saves me money. jim at Blueprint for Financial Prosperity did just that today by linking to this wonderful $100 offer for Citi cardholders.

You can read all the details at Blueprint, but to summarize:

  1. Follow jim’s link (the one that says “this link”).
  2. Sign up for some Citi service you don’t need.
  3. Citi sends you a “$100 gas cash-back certificate.”
  4. You remember to cancel the service within 30 days, and you don’t get billed.

What’s a “$100 gas cash-back certificate?” I’m not quite sure, but hopefully it gives me either $100 worth of gas or $100 worth of $100.

As for the “(or More!)” in my headline, we’ll actually be getting $200 because I signed my wife up on her card, too. (Shhh, don’t tell her she’s getting $100 in gas for Christmas!)

Wednesday, November 8, 2006

Adventures in First-Time Homebuying #6: The Hunt for a Real Estate Agent, Part 4

Author: Nick
Category: Money
Topics:

buy a house, get cash back

Now that you know how to find the perfect real estate agent to help you buy your first home, you might be thinking of totally ignoring all my advice and acting as your own agent. Some reasons you may want to be your own real estate agent:

  • I won’t have to deal with a real estate agent!
  • I’m really smart and can find a house on my own!
  • I can get the agent’s commission!
  • Just to spite you, Nick!

If you decide to strike out on your own, you’ll quickly find that all of the above are mostly untrue. Let’s tackle these myths one at a time.

Myth: If I’m my own agent, I don’t have to deal with an agent!
Fact: You won’t have to deal with finding your own agent, but you’ll still have to deal with the seller’s agent. The only case when this isn’t true is if the seller has also decided to go it alone through a For Sale By Owner (FSBO).

Myth: I’m really smart and can find a house on my own!
Fact: Golly gee, I can find houses all over the place. But if you want to actually look inside the house, you’ll either need your own agent or you’ll have to call up the seller’s agent to take you through. If you have the seller’s agent show you around and you decide to make an offer, then guess what? The seller’s agent is your agent now, too!

Myth: If I’m my own agent, I can get the agent’s commission!
Fact: Unless you’re a licensed real estate agent, don’t count on it. That money will likely go to the seller’s agent instead. (But if you’re determined to get your hands on some commission cash, read on…)

Myth: I’d do it just to spite you, Nick!
Fact: Go right ahead. Give me a call when you’re drowning in paperwork… so I can laugh at you!

Put aside any thoughts of going through the buying process without an agent. If you’re buying a home, the seller pays for your real estate agent. That means you’re getting experienced, professional help to find and buy your home for free. Please please please take that free help and put it to good use.

No! I Want Commission Cash! Gimme!

Real estate agents make pretty good money. Say your agent helps you buy a $300,000 home with a 3% commission for the buyer’s agent. 3% of $300,000 is $9,000! While some of that will go to the agent’s broker, they still get to pocket a good amount of it.

Now wouldn’t you love to get even a tiny portion of that 3%? Even if it’s just a small sliver of it? Just 20% of that buyer’s agent commission would be $1,800. That’s your first month’s mortgage payment right there!

It’s actually not all that hard to get some of your buyer’s agent commission. (If you want all of it, go become a licensed real estate agent.) Here’s what to do if you want to roll in a little agent dough.

  1. Get pre-approved for a mortgage. But you’ve done this already, haven’t you?
  2. Find some potential properties on your own. This is helpful but not required. We covered some of the methods of finding homes in Episode #3. And you’re more likely to get a commission rebate on higher-priced properties since there will be more commission money to go around.
  3. Do your homework. Know the ins and outs of buying a home so that your agent won’t have to spend so much time educating you later. This will make you a much more attractive client.

Once you’ve followed steps 1-3 above, do one of the following:

  • Call any agent and ask for a rebate. If you’ve picked out a home (or you at least have a good idea of what you want in a home), and you know your real estate stuff, many agents will be glad to give you a chunk of their rebate even if they don’t normally do so. The more low-maintenance you make yourself appear, the better chance you’ll have at getting a good rebate.
  • Ask the seller’s agent to give you a rebate. Remember how I said that the seller’s agent would get the buyer’s commission if you acted as your own agent? It’s risky, and you won’t have the benefit of your own agent looking after your interests, but you can do just that and ask for a cut of the commission in return.
  • Use an agent who advertises a rebate. There are several regional or nationwide brokers or associations with agents who give a rebate as part of their standard service. Some of the big names in rebating real estate: BuySide, RebateReps, and ZipRealty.

One final note: commission rebates are illegal in some states. The list of states prohibiting rebates changes often as new laws are enacted, but you’ll find out really quick if it’s illegal in your state when you ask an agent for a cut of his or her commission.

Our Real Estate Agent Experience

We were just as happy with our real estate agent as we were with our mortgage loan officer. Since getting some of that commission money was too big of a temptation to resist, we found an agent through ZipRealty.com. Our agent was local and had several years of experience selling homes in our area of interest. We were ideal clients; we knew the property we wanted, we knew our way around the purchase process, and we wanted the same thing she did–to put us in that house. She helped us submit our offer, and the rest of the process was a cakewalk.

Oddly enough, we hired our agent her last day with ZipRealty. She switched to RE/MAX, and RE/MAX was our official broker, but she still agreed to give us the 20% rebate on the 2.5% buyer’s commission we’d have gotten with ZipRealty. At ZipRealty, she received tons of clients and made lots of money even with those commission rebates. Her reason for switching: ZipRealty took a huge chunk of her commission, far more than any normal broker. At RE/MAX, she could make the same amount of money while juggling fewer clients.

I’d be happy to refer homebuyers in the Montgomery County, Maryland area to my agent, but I can’t promise you’ll get a rebate since she’s no longer with ZipRealty. Just send me an e-mail and I’ll give you her information.

Tuesday, November 7, 2006

Health Insurance Terms You Need to Know, From "Health Care on Less Than You Think" by Fred Brock

Author: Nick
Category: Money
Topics:

here are 100mg of awesome excerpty goodness from fred brock

Aren’t you a lucky duck? Not only do you get my fabulous review of Health Care on Less Than You Think, but you also get this lovely excerpt from Chapter 2 which explains some of those complicated terms your insurance provider loves to throw at you.


Know What Your Insurance Protects

by Fred Brock
Author of Health Care on Less Than You Think

Before selecting a policy from an employer menu (or shopping for an individual policy), you should be certain you understand the terms used by the health insurance industry. The meanings can vary slightly among insurers, so if a number or explanation doesn’t match up with the following definitions, press the insurance provider for more details; there may be costs or exceptions hidden in the differences in jargon.

  • Coinsurance is the amount you must pay after your health plan’s deductible has been met. It’s usually expressed as a percentage. For instance, you might have to pay 20 percent of every bill until the total of your own payments hits your out-of-pocket maximum.
  • Copayment is a flat fee you pay for health-care services, regardless of how much the doctor or hospital receives from your insurance provider. Some plans, especially HMOs and some PPOs, require a copayment, usually $10 to $30 for each office visit to a doctor and often higher copayments for emergency care.
  • Credit for prior coverage may be something you need to prove — normally with a letter from your former insurer — if you are switching employers or insurance plans and need preexisting conditions to be covered right away. This is especially important if you are buying an individual policy, which can have a waiting period for preexisting conditions.
  • A deductible is the amount you must pay for your medical bills before your insurance kicks in. Usually the higher the deductible runs, the less expensive the policy is.
  • EOB (explanation of benefits) is a statement from your insurance company showing what it has paid and not paid for a claim. Some companies resist supplying duplicate EOBs, so maintaining an organized file of your EOBs is important if you need to challenge a bill.
  • An EPO (exclusive provider organization) plan allows you to use any doctor or hospital within the insurance provider’s current network, without a referral. You have no coverage, however, outside the current network even if your doctor used to be included in the plan. There can be copayments similar to those for HMO and PPO plans.
  • A fee-for-service (indemnity) plan is the traditional kind of healthcare policy that allows you to go to any doctor or hospital you choose. Deductibles can range from several hundred to several thousand dollars. After you have paid bills totaling your deductible, the plan usually pays 80 percent of all bills; you pay the other 20 percent up to an out-of-pocket maximum that generally runs between $1,500 and $3,000. After you have reached the out-of-pocket maximum, the policy pays 100 percent of your medical expenses. In most states, fee-for-service is the most expensive health insurance you can buy.
  • An HMO (health maintenance organization) is essentially a prepaid health plan. For a monthly premium, the HMO provides comprehensive care. You likely pay a copayment for office visits, but most HMO plans have no deductibles. (The exception to the no-deductible rule is an HMO that is eligible for a health savings account.) There are usually no forms to fill out or bills to keep track of. You are, however, quite limited in your choice of doctors, hospitals, and other health-care providers. You commonly must get a referral from your primary-care physician to see a specialist; if you don’t, your treatment with the specialist is not covered. Though HMOs were designed to control costs, they have been the source of many consumer complaints. These complaints were often because of coverage limitations or the fact that some doctors were compensated for denying treatment or referrals to patients or punished for providing what was considered by the HMO to be excessive treatment, although both problems have lessened in recent years. Because of their comprehensive, deductible-free coverage, HMOs often compete with the most affordable health insurance options.
  • An HSA (health savings account) is a less expensive, high-deductible policy linked to a tax-free savings account that can be used to pay medical bills before the policy’s deducible is met.
  • Lifetime maximum is the maximum amount of covered expenses your insurance company will pay in your lifetime. Look for a policy with a lifetime maximum of at least $3 million.
  • Out-of-pocket maximum is the amount of coinsurance you must pay yourself before an insurance policy will pay 100 percent of your bills. It may or may not include the deductible. The term stop-loss is sometimes used to refer to the point at which you have met your deductible and paid your out-of-pocket maximum.
  • A POS (point-of-service) plan is like a PPO except that you need a referral from your primary-care physician to see an out-of-network doctor, for which you may have to pay extra. Without the referral, you will likely have to pay the entire bill for the out-of-network physician.
  • A PPO (preferred provider organization) plan is a cross between a fee-for-service plan and an HMO. You can see any doctor you choose without a referral, although if the physician is outside the insurance plan’s network you will probably be reimbursed at a lower rate. For network doctors, you usually have only a copayment for office visits. There can be varying copayments — as well as deductibles, coinsurance, and out-of-pocket maximums — depending on the policy. Most plans that are eligible for use with a health savings account are PPOs with a high deductible tacked on.

These terms, of course, aren’t exclusive to individual policies. Many employers offer a menu of plans for you to select from that usually includes HMOs, PPOs, and traditional indemnity plans. Increasingly, companies are offering HSAs and dropping indemnity plans because they are so expensive.

Reprinted from Health Care on Less Than You Think: The New York Times Guide to Getting Affordable Coverage by Fred Brock. Copyright © 2006 Fred Brock. Published by Times Books; October 2006; $15.00US/$20.00CAN; ISBN 0-8050-7980-7.

Monday, November 6, 2006

No-Nonsense Book Review: "Health Care on Less Than You Think" by Fred Brock

Author: Nick
Category: Money
Topics:

health care on less than you think by fred brock

Title: Health Care on Less Than You Think
Author: Fred Brock

Short Attention Span Summary. Tips and tricks for cutting your health care costs. Useful for people with multiple options, no employer health plans, or little money for insurance premiums.

What’s in the book? Health Care on Less Than You Think provides a broad analysis of the state of U.S. health care. The book opens with an interesting look at the events which led to the current health care crisis, and the rest is designed to make sure you don’t become another victim of the crisis. Topics covered include:

  • Common health insurance terminology you should know to help you find the best plan for you.
  • A detailed look at Health Savings Accounts (HSAs), a new concept which can save certain people money in the same way a higher-deductible car insurance policy can save a driver money but with the added benefit of using tax-free dollars to pay medical expenses. Brock spells out with clear, concise examples who can benefit from HSAs.
  • Creative solutions to obtaining individual health insurance. For example, Brock suggests moving to one of five guaranteed-coverage states (Maine, Mass., NJ, NY, and Vermont) if you can’t get insurance elsewhere.
  • Comparisons of HMO, PPO, and HSA plan prices and the range of expenses which may come with each. This part definitely makes pricing policies and options a little easier.
  • Tips for saving money on prescriptions, from shopping around, ordering cheaper higher-dosage pills and splitting them to your needs, or buying name brand (but not generic, which are more expensive) from Canada.
  • An easy-to-understand chapter on Medicare, its costs, and gaps in coverage–along with ways to overcome the gaps and how much it will cost to do so.

my diagnosis: you are allergic to money, so give me all of it

The best part of this book is Chapter 7: Mastering Your Insurer’s Fine Print. A better title would have been “When Insurance Companies Attack” as this section explains how to deal with rejections, disputes, and unexpected charges. I hope nobody who has insurance ever needs to use this chapter, but it provides a series of smart strategies for handling situations when your insurance doesn’t behave as expected.

People who need to read the book probably can’t afford it. There’s a lot of great information on obtaining affordable health care, especially for those who can’t keep up with the pinch of monthly premiums or who aren’t healthy enough to qualify for individual coverage. Brock offers practical advice and real-world examples for slashing medical costs, and anyone struggling to pay their doctor bills should find at least one or two useful tidbits that will save them money.

People who may want to read the book… Anyone who is confused by multiple employer plan options. Not sure if an HMO or an HSA is your best choice? Health Care on Less will help you calculate the costs and determine the risks and rewards of each option.

cut prescription costs: replace pills with mike and ikes

How did this book help me? I definitely have a better understanding of how health insurance works. My own options are limited to my employer’s various HMOs, but the book inspired me to ask my employer to start offering HSAs since they could save me a lot of money. Hopefully that pans out; in the meantime, I haven’t picked up on any tips that’ll save me money on health care overnight. But if my insurance provider ever decides to pick a fight with me, I’ll be armed with some tough strategies for fighting back.

Is this book worth buying? The people who stand to save the most money with the techniques in this book are those who aren’t sure which insurance option to choose. Brock presents examples where people saved thousands by doing the math and making careful health care elections. These are calculations you can do by yourself with information from health care providers, but Brock’s examples make them a lot easier. As an added bonus, you’ll find some useful tables in the back of the book to help price your plan options and keep track of services rendered.

Health Care on Less will pay for itself if your finances are tight and you need to pay for your own health care. The chapter on prescription drugs alone could save you a ton with lots of ways to find cheaper pills. Again, while you could dig up this information yourself, Brock spells it out with stylish charts, fun examples, and easy guides that are sure to help you cut down on your medical costs.

Buy Health Care on Less Than You Think on Amazon.com ($10.20 as of November 6, 2006).

Punny Money’s No-Nonsense Book Reviews

Author: Nick
Category: Money
Topics:

no-nonsense book reviews

In the next day or so I’ll be putting out my first real personal finance book review. Writing book reviews can be tricky because people looking to buy a book often want a clear yes or no answer on the value and content of the book. Traditional book reviews talk at length about the content and might mention some of the benefits of reading the book. Some will also include scores like “3 1/2 stars” or “7 out of 10.” Scores are nice for people who would rather read numbers than words, but people looking for book reviews probably want to know if they’ll get their time and money’s worth out of reading and/or buying it.

That’s why I’ve come up with a sort of template for all my future book reviews. I call them No-Nonsense Book Reviews because they’re short, concise, and get right to answering the most important question–should I get this book? These are book reviews for people who would rather read books instead of book reviews.

Here’s exactly what you’ll see in every Punny Money No-Nonsense Book Review:

  • Short Attention Span Summary. In 25 words or less, I’ll tell you what’s in the book and who, if anyone, should pick up a copy.
  • What’s in the book? Quick, straight facts on the content of the book.
  • The best part of this book… is self-explanatory. Maybe there’s a chapter or a memorable anecdote that really stands out. I’ll pick it out and mention it here.
  • People who need to read the book. If there’s a particular subset of people whose lives will be changed by this book, I’ll come out and say it here.
  • People who may want to read the book. The book might not be life-changing for everyone, but some people may still enjoy reading it and take something away from it.
  • How did this book help me? I’m an ordinary person like you, so there’s no better way to show the usefulness of a book than by stating how it’s helped improve my life.
  • Is this book worth buying? There’s a reason I own few books: just about anything I need to know can be found on the internet for free. I would argue that practically every personal finance subject has been exhaustively covered already and can be found online with a quick visit to a search engine. That said, books often present such information in an easier-to-read, more enjoyable format. This section answers a few key questions:
    • Is there unique information in this book you can’t find anywhere else?
    • Can you find the majority of the information in this book online with little effort?
    • Is there a different book I would recommend in place of this one?

Do you want your personal finance book reviewed by Punny Money? Then contact us!