Expenses

This category looks at stuff that we spend money on!

CardGuide.co.uk: Give yourself some credit where credit’s due!

Posted by

statementYou ever got a statement from one of your UK credit cards, and looked at the interest payment at the bottom line! You felt bad, right! You bought a new doodah… that cost a gazillion dollars!

So you decided to delay payment until next month or to spread the payments over several months, but you are still staring at the interest you had to pay! Now you feel guilty! You didn’t need to spend that money, did you?

Well, this post is to put the opposite point of view: to make you feel better! Because this may not have been a bad move for you to make! Let’s say you bought something you felt necessary for your house or life. For argument’s sake, your pc broke down, and you decided to buy a new one! So you spent $799 on a new DELL or HP portable!

OK. Let’s assume that for a general credit card interest rate of 19.50% (my previous rate) and I have to pay off 5% minimum each month with a $30 minimum payment. Then I’d pay $228 interest plus principal over 33 months. That’s pretty lousy rates.

Except: first, you pay off the loan much quicker than that, perhaps in only 3 months. Your interest paid would only be a little amount (about $30) and you don’t have to feel so bad.. You reduced your interest payment by nearly $200, you had your computer for your work for 3 months already, and your credit card is now clear!

If you know how to take advantage of your credit card, you may also find that in some 0% interest rate purchase deals that would you allow you a grace period for that 3 month period! Result: you’ve just reduced your interest payments to $0! Nice move.

You may even be able to find some cashback deals, if you are shrewd, that would PAY you either bonus points or cashback, moving you into something of a profit situation!

Credit card interest rates may be exorbitant but the revolving nature of the loan, the flexibility of how you spend it, and how you repay it; and also, the bonus points, cashback or 0% deals that you can get: all of these can make credit cards quite a valuable tool for you!

Keep your friends close; keep your credit cards closer!

Sponsored Post by CardGuide.

Tax Deadline Approaches: Uncompetitive tax regimes make my blood boil as they extract more than a pound of flesh!

Posted by

Yes, even in Taiwan we all have to pay Taxes, and even here Death is certain, too! Just to dispel any rumours. However, tax deadline is much later than either the UK or the US. And that day is tomorrow, May 31st! F32in2

So, after spending hours fighting with the paperwork (actually just two or three!) and plugging the data into our ‘free’ (did I say, free!) software, provided by the Republic of China National Tax Administration (Thanks, guys! Good job!)! No Quicken or Intuit here! … we were able to complete this year’s tax paperwork.

We printed it off, and promptly forgot to go to the Post Office! So that’s what I’ll be doing first thing tomorrow! I don’t usually mention taxes on this blog for several reasons: the most important of which is that taxes are SO different from country to country – and so much lighter a part of the burden for individuals in some jurisdictions than others.

Suffice it to say, Western countries, like the UK or Germany have tax rates that are CRUSHINGLY high for most people: income taxes, house taxes, car taxes (gas, licensing, etc.), VAT (17.5% in the UK), taxes for this, taxes for that, taxes for the next, … When other countries (like Hong Kong, and Japan…) adopt UNCOMPETITIVE tax regimes (EU Tax commissioners words, not mine), I just want to shout, “Yes! That’s right!” But it’s not these NIC countries that are being UNCOMPETITIVE, it’s YOU, it’s YOU OLD EUROPEAN countries that want high taxes, to line your treasuries’ pockets, not your citizens’ pockets. Yes, you might create social benefits with the monies, but then yet again, you might spend it on creating and maintaining beaurocracies! Why not let your citizens decide what to do with THEIR money!?

Now, I know and freely admit that I’m not an expert on taxation issues; nor do I care about European taxes that much! But when tax authorities that operate under profligate governments who want to create little fiefdoms at the expense of individuals cry that other countries with low-tax regimes are UNCOMPETITIVE, it is a signal that things are not right.

Let’s put this on an individual level: Two neighbors live in an average priced housing area with similar incomes and similar general expenses. One of the neighbors, however, spends more on gardening, house renovation, has more children, goes on more expensive holidays, purchases more food; while the other seeks to rein in non-essential spending, preferring simpler decorations, … Do you think it makes sense the first neighbor goes around shouting: “Neighbor, you’re being uncompetitive! You need to spend more! Spend more like me! Then we can be good neighbors!”

Do you think you’re government is profligate or thrifty? Is your government a good neighbor or a bad neighbor? Does your government encourage fiscal responsibility or fiscal stupidity? Comments, please! Perhaps someone more knowledgeable than I can weigh in on what tax competition means, too!

—-
This posting is an entirely personal and unresearched opinion on TAX issues. I do not pretend to KNOW anything about taxes or principles of taxation, except as much as I need to to file my own taxes. As with any financial issues, you need to seek validated and professional advice from qualified and authorized sources!
—

Secondhand or Brand New: Is that Fortnum & Mason’s or Fleamarket?

Posted by

1

(edited: I updated the title just a few minutes ago: Fortnum & Mason’s is a well know and classy department store in London.)

An article at Mighty Bargain Hunter got me started on this train of thought! If you wish to read that article, it’s called What the heck’s wrong with a pre-viewed DVD? This touched off my ideas about other things that I had bought secondhand over the years! And I was quite surprised by the list of items that I had bought!

Do you ever buy second hand items? In our throw away societies, buying second hand always has the taint of not being able to afford things, or making do, or even poverty! But it needn’t. There are many items that bought second hand actually represent a much better, more environmentally safe, and financially more prudent investment. In this post, I’ll write a little about the things that I bought second hand that were good, as well as those that wasted my money! I didn’t intend on most occasions to buy these products 2nd hand, but I just found myself with an opportunity.

1. 2nd Hand Books. I have bought quite a bit over the years. When I lived in the UK, I would buy a lot of great second hand books: for example, Jane Austen new editions in Penguin Classics would cost GBP3 or 4, but I picked up a used hard back copy from about 50 years ago, price GBP1. And it was much better quality. I still have it and it still looks good, but the paperbacks now look brown and wrinkled. In some cases, they have a slightly bad smell… Also, in many cases, you can no longer buy new editions of many books. Verdict: definitely worth it.

2. Computers. Over the years, I have accumulated a number of older computers for different purposes. The first one was a waste of money, really. It was installed with Chinese Windows 98SE, and then upgraded to ME. Both of these OSes ran so slowly in 32MB that it just wasn’t worth using. It’s now sitting gathering dust.

The second one faired better, but also died sooner because of the air from nearby hot springs in Beitou. The air rotted the metals in the motherboard… The third and fourth have been much better. But I’m not looking for a lot of use out of them. Just a stop gap of about 12 ~ 15 months. If they last longer than that, I’ll be happy.

A last experience I had was surveying a rather cheap notebook pc that had been advertized. I was interested but when I got to the house, I found that the machine wasn’t in good condition (see mobile goods), wasn’t very portable any more (needed a new battery), and was somewhat overpriced for its condition. I naturally offered less and met seller resistance. I would have raised my offer, but the seller didn’t want to, so I baulked and walked. Many second hand pcs are priced at double or more their actual value, as sellers forget to factor in the rapid devaluation of computers due to their ever-increasing power. I estimated that at about 30-50% – but its rare to find a seller willing to sell last year’s pc at that kind of discount. Verdict: probably not worth it.

3. Software. A few years ago, Ebay permitted the sale of ‘second-owned’ or second hand software. My luck with this was very much mixed. I bought one or two programs that were advertised as complete and with licensing numbers and whatnot. But when they came, the products didn’t work. On the other hand, I did get a great deal on a Win98SE license and an Office 97 package. I also found other ‘as new’ software that worked without a hitch and just wasn’t available to me at the time in any other way; but it seems that nowadays, much of this software is legally considered graymarket. Verdict: not worth it: go with opensource software instead.

4. Clothes. My wife was quite thrilled to pick up a pair of silver women’s high-heeled sandals that she loved for about GBP2.00 last summer! She’d never seen anything like them before or since! And she loved the price. She still wears them, too! I also found a great tweed jacket that I got drycleaned and wore a lot! Don’t know quite what happened to it, though. Verdict: if you see something you REALLY like, get it!

5. PDAs and other mobile goods. My wonderful PDA from Palm broke down one summer about five years ago! I replaced it eventually with two second hand PDAs. Neither of them worked well past the first bootup for quite different reasons: the first didn’t connect to my PC via any connection that I could find, and the second had a broken USB in common with many others from PALM. I don’t remember the model numbers, but this was just before Palm’s stock and business started declining. Eventually, though, I realized that handheld items like cameras, PDAs, and phones, etc. will never make good secondhand purchases. Even if you get a model that is fairly well made, and reliable, you can never know how many times it’s been dropped or treated badly. You will likely spend much more money than purchasing a new one to get it repaired, too. Verdict: definitely not worth it, buy a new one.

I’m not immune to purchasing other second hand items, though. But the deal has to be an obvious one, and I have to have a clear idea about the state of what I’m buying and its relative value!

What experiences have you had buying second hand items? Let’s hear your suggetions!