Ten Things the MLS Can't Tell You

When you're in the market for a new home, it's easy to spend hours pouring over online listings. But don’t get too excited about that dream home that meets all of your criteria on paper: the listing is just the beginning.

Think of the MLS (Multiple Listing Service, an online database of homes for sale) as one giant advertisement whose main purpose is to pique your interest rather than to inform you about a product. The most important pieces of information it can give you are what neighborhoods you can afford, the addresses of properties for sale, the prices of those properties, and a few key details like whether the place comes with a dishwasher and how many rooms it has.

But even what appears to be a detailed listing can seem like a woefully inadequate description once you’ve visited the place. Sometimes a listing can even be downright misleading: it’s hard to believe, but mobile homes located in trailer parks are not always identified as such on real estate websites. With this in mind, here are ten important things that even the best listing is unlikely to describe well.

1. Layout. Even the best photos can't give you an idea of how the floor plan feels when you're actually in the place. A 1500 square foot condo may sound spacious on paper, but it can actually feel cramped if the place hasn’t been designed well. A small split-level living room may leave you without any good place to put your couch and television, for example. Additionally, the listing may say the place has three bedrooms when it really has two bedrooms and a tiny office.

2. Design. Will your existing mid-nineties wood veneer furniture match your new solid maple hardwood floors? If you’ll have to buy new furniture to match or fill up your new place, you’ll be adding a significant amount of extra shopping time and expense to your home purchase. Also, even a brand new place can have significant design flaws, like a bathroom door that bangs into the toilet.

3. Storage Space. Many buyers are in it for the long haul rather than to make a quick buck, especially in today's market. The longer you live somewhere, the more stuff you'll tend to accumulate. Is the place spacious enough to accommodate not just your current belongings, but future possessions as well? Is there adequate closet, garage, or attic space to hold all that stuff in boxes that you never use but don't want to get rid of?

4. Neighbors. How loud or quiet are your neighbors? Is the community active and tight-knit, or do people keep to themselves? Are there lots of children running around? Also, if you’re looking at a brand new condo or townhome, keep in mind that you'll have no idea what the character of the building's community is like until you already own the place.

5. Privacy. Where are the windows and who can see into them? Is it all-too-easy for passersby to peep in or for would-be criminals to observe your comings and goings? If you're looking at a house, how close is it to your neighbors? For condos and townhomes, how thick are the walls?

6. Safety. Will you feel comfortable walking around the neighborhood by yourself? How about at night? Do alleys or neighboring buildings have graffiti?

7. Noise. Is the home on a busy street, and if so, can you tolerate traffic noise, including angry honking and sirens? Is the home near a bar, fire station, police station, hospital, or airport? What are your neighbors' living habits? Musicians, babies, and some twenty-somethings have the potential to be especially noisy.

8. Parking. This is particularly important if you're planning to buy a condo or townhome, or if you're planning to live anywhere in the city rather than in the suburbs. Do parking spaces come with the unit? Would you prefer a townhouse with an attached garage, or is apartment-style community garage parking acceptable to you? When you have guests over, will they be able to find a nearby place to park on the street, or does your garage have guest parking?

9. Vibe. Is there enough natural light, even on a cloudy day? Does the walk from the garage to the back door give you the creeps? Are there shady characters hanging out on the street drinking booze out of paper bags? Does the neighborhood have a chaotic feel?

10. Value. The MLS will tell you if you can afford a place, but it won’t give you any idea of what kind of value you’re actually getting. In my experience, price seems to depend more on location than on the actual amenities of the unit. The range of what's available is huge, from $1.6 million condos that seem like a pure waste of money to $200k houses that make you feel like a million bucks.

So go ahead and start drooling when you’re searching for your dream home online, but don't get your hopes up too high. Remember that to get a true picture of any place, you’ll want to check out open houses and schedule visits with a real estate agent. The MLS is just the beginning.

Don't Trade it In: Resell Your Used Stuff Yourself

Trading in your old model when you're moving up to a new one can seem like a great deal at first, but you'll often throw money away if you take this route. No matter what you’re trading in, the same fundamental principle applies: when you sell to a store or dealer, you're forced to sell at a significantly lower wholesale price so the store can profit by reselling the item at retail price. When you sell to a private party, that higher retail value goes straight to you. Here are a few common instances where you might be tempted to trade in your old item but can get a better deal by reselling it yourself.

-Trading in your old car at a dealership. Even if you go to one of the supposedly fair no-haggle dealerships, this is a great way to lose money. You’ll trade convenience for a lot of cash, sometimes thousands of dollars. By selling your old car to a private party, you can typically get double what a dealer will pay you for the car. One caveat: If your old car is a lemon, you may feel better unloading it at a dealership.

-Getting a new cell phone. Have you seen those cell phone recycling bins at the store? I'm not sure what they do with those phones, but you'll be better off selling your phone on eBay. I recently sold a three-year-old cell phone that was scratched up and had a dying battery for a surprising $25. If you originally got your phone for free, you can actually make a profit this way.

-Trading in your used CDs, DVDs, or video games at brick and mortar stores. At best, you'll get 50% of the item's value, and you'll often get less. What's worse, the store probably won't buy everything you're trying to get rid of. Sell your items on Amazon or Half.com for the greatest profit. In my experience, if you're willing to sell your item for less than anyone else is, it will almost always sell.

-Books. Don't even bother taking your books to a half price bookstore. Most pay a small pittance for an entire grocery bag's worth of books, which will only depress you. Again, Amazon is your best bet.

-Collectibles, such as action figures and comic books. You used to have to haul your stash to conventions or go to hobby stores that would sell your stuff on consignment—neither of which was very easy—but now you can sell it to the highest bidder without ever leaving home, and make more money doing it.

That being said, there are a couple of situations where it can make more sense to trade in your old items rather than resell them.

-Clothing. Most clothing (aside from certain designer label items) is difficult to resell on eBay and isn’t even worth the effort to sell at a garage sale. If you take it to a secondhand store, you might have a decent chance of getting money for it as long as it's still in good condition and not out of style. One store I frequent will give you 50% of your item’s retail value (the retail value being the price they are going to resell the item for, not the price you originally purchased it for) if you trade it in, or 30% if you want cash. The cash value is usually so little that I think it's a better deal to essentially trade one or two old items of clothing for a new (to you) item.

-Very old cars. Depending on what state you live in, you may be able to sell your very old car to a government program designed to get highly polluting vehicles off the road. Sometimes to qualify for these programs your income cannot exceed a certain threshold, and you're unlikely to get more than $1,000 for your car. You also have to be willing to accept that your beloved car is going to end up on the junk heap. However, if you haven't been able to sell it to a private party or don't expect to get more than $1,000 anyway, this can be a good route to take. A dealer may not be willing to purchase your 1976 Volvo at any price.

For stuff that you can't sell online or trade in at a store, garage sales can be attractive. You won’t get much money for your stuff, but it's a pretty simple process if you do it right, and you might get a few bucks for items you'd otherwise just have to toss. Garage sales have really come back into fashion because people like to go to them to hunt for things to sell on eBay. So if you aren't inclined to go through the eBay process yourself, you might be able to easily sell your stuff to someone who is.

In the past, trading in your used stuff was a great deal because you could get more money for an item that way than you would selling it yourself. For the average person, venues for selling items to other private parties were very limited. But now that we have eBay, Craigslist, Amazon, and other online options, a little extra effort can get you a lot of extra money. When you consider that the time spent listing and shipping items can be similar to the time you would have spent taking items to a store to trade them in, you haven't even lost any time.

Seek Out Your Local Ethnic Markets for Cheaper Food

Did you grow up eating Cheerios, Oscar Meyer hotdogs, Tombstone pizzas, and other mainstream American food? If so, it's likely that your family has been living in this country for a long time, and shops at a large chain grocery store. If you or your parents are recent immigrants, you already know what I'm about to say.

If there is a particular non-American cuisine you are fond of, you might really benefit from seeking out stores in your area that primarily or exclusively sell that country's products. In my experience, mainstream, big box grocery stores tend to sell international products at a ridiculous markup. They also tend to sell overpriced, inferior, and inauthentic brands (Old El Paso or La Choy, anyone?) over brands that are true to the cuisine, and they don't sell a lot of the spices and condiments you need to make things like Indian or Vietnamese food in your own kitchen.

In addition to getting your favorite spices, condiments, exotic ice cream flavors, and baked goods at much lower prices, you'll also often find that staples like meat, fish, and produce are significantly cheaper at these stores. Depending on where you live, you may have to drive across town (which costs money), but the savings on food, the superior products and selection, and the added excitement of going to a new store full of products you haven't been eating since you were two can really be worth it.

You Never Know What You'll Find at a Garage Sale

I love garage sales for many reasons, but the thrill of the hunt might be the biggest reason. I rarely go to garage sales in search of a specific item because that's asking for disappointment--garage sales are very hit-and-miss. I always keep a running wish list of things I want, though. My wish list prevents me from making impulse purchases and helps me remember the things I want to buy so that I can snag them for cheap when I spot a great deal or treat myself to something nice when I have some extra money. Here are some examples of wish list items I've stumbled across at garage sales, thus saving quite a bit of money.

New desk chair: The desk chair I had was that very basic model you always see that has no armrests. Mine was so old that the padding was virtually nonexistent and using my computer caused me back pain. Needless to say, it was hard to get any work done on my desktop computer. I find that desktops are better for certain tasks, but since I also had a laptop, I couldn't justify paying retail for a new desk chair. Luckily, I found the exact kind of desk chair I wanted (full back support, adjustable seat height, adjustable armrests, lots of padding) at a garage sale for $3. I couldn't believe it! True, the top of one of the armrests keeps falling off, but to save $97, I'll deal with it.
Savings: $97

Jewelry organizer: I had been looking for something to organize my jewelry, which I was storing in Tupperware containers. It got tangled easily and it was hard to pull out what I wanted to wear. As a result, I had stopped wearing a lot of my jewelry -- a waste of a fair amount of money. I searched on eBay for jewelry boxes and organizers and didn't find anything that would suit my needs for a reasonable price, so I had resigned myself to sticking with my existing Tupperware system. Then, at a garage sale, I found exactly the kind of organizer I was interested in for $1.00. It wasn't an item I truly needed, and it was one I had decided I could live without, but for $1.00 I'd certainly choose to buy the item and get more organized.
Savings: $29

Canning jars: Thanks to a post on Get Rich Slowly, I came up with the idea to make muffin and cookie mixes for Christmas this year to save money. I needed some nice jars to put them in, but I didn't know where to buy them and I didn't want to spend much money on them since the whole point of my gift idea was to save money. One Saturday morning, I found five jars for 50 cents each at a yard sale. Three of them have particularly attractive green lids, and five jars is plenty for my needs. At the store, I doubt I could have gotten even one jar for $2.50!
Savings: $23

Saving Money on Car Ownership: Why New Cars Don't Save You Money

A friend of mine, whom I generally agree with on all matters financial, does have one belief that I have to disagree with. He thinks that once a car surpasses 100,000 miles or so, the costs of having to repeatedly fix the vehicle aren't worth it, and that it makes more sense to trade in the old car and buy an almost new one. I don't think this is the best strategy for saving money, however.

Some years, if not most years, older cars will require $600 to $2000 or more on repairs like rebuilding the transmission, replacing worn suspension parts, or replacing the timing belt. With a new car, you'll still have to cover the occasional repair that isn't covered by the warranty, and after just a couple of years, the warranty will run out and you'll be responsible for everything. On top of that, you've got a monthly car payment plus interest, or a gaping hole in your bank account from a new car that you bought with cash (cash that could have been earning interest). Assuming a modest car payment of $350 per month, that's $4200 a year before you've even fixed anything. Also, insurance premiums are much higher for newer vehicles than for older vehicles, in part because you'll want collision coverage, which isn't necessary for an old car with little monetary value (since it will almost surely be totaled in the event of an accident).

This argument doesn't work for all vehicles, however. Sadly, some brands just aren't built to last. The case for buying an old car is much more valid when it comes to reliable cars like Hondas, Toyotas, Mazdas, Volvos, and Nissans (if you look around, you'll notice that almost every very old car on the road is one of these brands).

Also, the costs of owning a new car versus an old car can't take intangibles into consideration. Important things to consider in this category include:

-How comfortable do you feel driving an older car?

-Will other people who ride in your car frequently be comfortable and safe in an older car? (If you choose a Volvo, the answer is probably yes.)

-Does your career require a certain type of vehicle? In certain professions, driving a luxury vehicle is considered part of the job description.

-How much pride do you take in the type of vehicle you drive?

I was originally planning to purchase a newer vehicle because I feared the high repair costs and unreliability of an older vehicle. It was a fluke that I ended up purchasing a twenty-year-old Honda, and it was meant to be a temporary solution at the time. However, two years later, my fears haven't been justified--driving an older car has provided me with a surprising peace of mind. I feel very comfortable driving an older car because my car is smaller than almost anything they make today, which makes it easy to maneuver and park, and I feel like criminal types probably won't mess with me if I don't look like I have anything for them to take. I also don't worry as much about getting into an accident, because my car is worth so little, and I've long accepted that any accident would result in my car being totaled by my insurance company. I don't do much freeway driving or stray very far from home, so the reduced safety of my older, smaller car and the possibility of breakdowns aren't major concerns for me. Also, I'm not very image conscious, so it doesn't bother me that 90% of cars on the road are nicer than mine. For all of these reasons, I would actually feel much less comfortable driving $15k down the street.

Just because driving an older car can save lots of money doesn't mean it's the right choice for you. If an older car isn't for you, I'd like to point out one thing my friend definitely has right: purchasing a pre-owned car. Brand-new cars lose a significant percentage of their value the minute you drive them off the lot. By purchasing a car that's about a year old, you retain many of the benefits of new car ownership, such as excellent physical condition, warranty coverage, and low repair costs, while achieving significant savings. If you do want to own a new car, buying a year-old car is really the way to go. There are bargains to be found on cars like this by purchasing through a rental agency that sells their cars, such as Hertz. Since car renters expect excellent reliability and cleanliness in a rental car, these cars tend to be very well-maintained.

My stance is generally that the whole point of having disposable income is to enjoy it. If you're paying your bills on time, providing for those who depend on you, making regular contributions to your retirement fund, and have a comfortable emergency fund, there's nothing wrong with buying a newer, more expensive car. You work hard for your money, and you should enjoy it in whatever way is most enjoyable for you, whether that's hoarding it in the bank or buying a new toy.

Fat March and Money

I've been watching ABC's Fat March for the last few weeks. The show is about a group of twelve severely overweight people who range from roughly 100-300 pounds overweight. The show documents the group as they walk over 500 miles through eleven states on the east coast from Boston to D.C.

In addition to getting a ton of exercise, losing lots of weight in a short period of time and learning to eat healthfully, there is a huge cash prize for completing all of the walking. The prize starts at $100,000 per contestant but decreases by $10,000 per contestant each time one of them leaves the march. At the end of each stage, the contestants have the option of voting off one member that they feel is dragging down the team, but they don't have to send anyone home. Only one team member has to choose to send someone home for that person to be forced to leave, which can create tension amongst team members. In order for anyone to get any money, all of the contestants who don't drop out or get voted off in earlier stages must complete the entire 500+ mile walk.

For me, one of the most interesting aspects of the show has been watching how some of the contestants sabotaged themselves both physically and financially while others did not.

One walker quit after walking a mere 8 miles over the course of two days even though she was not injured or physically disabled in any way (aside from being severely overweight), costing her teammates $10,000 each and herself $100,000.

One contestant was very strongly motivated by the cash prize and barely complained at all about the weeks of grueling physical activity. She was the first contestant to finish many of the walks.

One member considered sabotaging the entire group at the very end by not crossing the finish line because she was mad that they voted her friend of, saying "It would be pretty freakin' cool just to freakin' stick it to everybody!" Can you imagine cheating not only yourself, but five other people as well, out of $40,000 each just out of spite? I am sure that she is not the only person with this kind of self-defeating attitude towards money, but for someone who wouldn't sacrifice even $100 out of spite (me), this kind of thought process is mind boggling.

The show has given me some interesting insight into how so many people in this country who have the means to live comfortably end up perpetually broke or in debt. I believe that all of us let our emotions get in the way of making sound financial decisions, but some of us have learned to keep those emotions in check more than others--and yes, it is something that you have to learn. I still can't stop myself from thinking that all people who drive luxury cars are jerks even though I know it's wrong to make such generalizations.

T. Harv Eker, author of The Millionaire Mind, says that each of us has many of these negative attitudes about money running through our heads day in and day out whether we are aware of them or not, and that we need to overcome them to achieve wealth. The idea is that if you think that people who drive expensive cars are jerks, you're also thinking that having a lot of money makes you a jerk. Therefore, in order to avoid becoming a jerk, you should avoid having a lot of money. Or perhaps you're still able to accumulate wealth, but you constantly feel guilty about having nice things when other people are living in poverty. Ideas like these may sound far-fetched at first, but if you read the book, I think you'll find that you too hold many of these negative attitudes towards money.

Being financially successful takes more than a decent paycheck. To accumulate wealth, we must learn when it is appropriate to override our emotions so that we do not sabotage ourselves.

Photo from AllCarWallpapers.com

The Cost of Convenience: The Pros and Cons of Having Groceries Delivered

Sometimes you just don't have time to go to the grocery store, or you aren't in the mood to deal with the crowds. Or maybe you find grocery shopping to be unpleasant no matter what--stores have gotten enormous, and they're set up to intentionally lead you on a wild goose chase for the items on your list, in the hopes that you'll pick up lots of impulse purchases on the way.

Having groceries delivered is a option in many major cities, but it can carry a hefty premium. After my most recent delivery purchase, where I ended up with three small bags of food for $70 (without buying organic), I had to wonder how much money my aversion to grocery stores might be costing me, and whether the convenience was really worth it. If you've been wondering the same thing, the following list of pros and cons may help you make an informed decision.

Delivery Pros:
-Saving time that could be spent on more productive activities.
-Avoiding impulse purchases. While it's just as easy to come across items not on your list when shopping online, it can be easier to resist something when it's a mere image on a screen as opposed to something you can actually pick up. Some delivery services don't even sell impulse items like gum and mints that people toss into their carts in the checkout line. It's also easier to remove unwanted items from an online cart than from a physical cart. Few people want to deal with the hassle of returning items to different locations around the store, or the embarrassment of handing the cashier several items that they've changed their minds about, especially when it comes to perishables like ice cream or meat.
-Knowing your subtotal as you go along. Few people add up the cost of their groceries as they are shopping--there are simply too many other things to think about. As a result, it's all too easy to spend more than you intended. When you can watch your subtotal online as you shop, it's easy to stay within your budget.
-Avoiding the possible stress that comes from leaving the comfort of your home. Whether grocery shopping is stressful, of course, depends on factors like traffic, time of day, familiarity with the store you're shopping at, and your personality.

Delivery cons:
-Paying higher everyday prices and missing out on in-store sales.
-Inability to use coupons.
-Decreased selection.
-Having to be home in the specific timeframe when the groceries are scheduled for delivery.
-The security risks involved in letting a stranger into your home to deliver the groceries.
-Grocery delivery services charge delivery fees. On top of that, you are also often expected to tip, which can easily add a premium of $10 or more to even a modest purchase.
-Online inventories are not always accurate, which means that you sometimes unexpectedly won't receive an item you've ordered, whereas if you were at the store, you could have substituted it. Smaller grocery delivery services often don't have the resources to offer any substitutions. Larger services may offer to substitute items for you according to your preferences (same size, different brand or same brand, different size). However, automatic substitutions can't take into account things like if they're out of brownies, you'd prefer cupcakes. Incorrect online inventory is probably the most frequent problem I encounter when having groceries delivered.

Overall, I think I would have saved about $20 by actually going to the store for my last purchase instead of having it delivered. However, I might have used some of that money to make impulse purchases, which would have reduced my savings (but would have given me more food for the same amount of money).

$20 is a significant amount of money to waste, but there are a few situations where I think it's not such a bad thing, assuming you have the disposable income:

-You are home sick and don't have the energy to go to the store.
-You're on a strict diet and need to avoid the temptations of the junk food aisles at the store.
-Getting groceries delivered frees up your weekend, allowing you a rare errand-free weekend in which to relax.
-Time is money, and the time you would have spent going to the store could be put to another use that is worth the extra cost of delivery. This one is especially applicable to those who bill by the hour for their work.
-You just had a bad day and want to make your life a little less stressful.

As you can see from the pros and cons, grocery deliveries will make more sense for some than for others. Hopefully, these lists will help you make an informed decision about whether this service is a good deal for you or not. For me, is usually makes more sense to go to the store, but when I'm feeling particularly busy or stressed out, I don't mind paying a premium to save time, avoid the chaos of the grocery store, and have someone else lug the groceries to my doorstep. What's your take? Have you ever had groceries delivered? Do you have a favorite delivery service? Is it worth the extra cost?