On Growth Track

Last month my wife had to visit ER as she had severe headache and high fever. The doctors could not diagnose the what’s wrong and wanted a blood test, one of the nurse in ER collecting the blood were so unskilled that they could not get blood from her veins. The other nurse had to come and do it for her. Finally she was diagnosed of viral infection and discharged with some prescription medication. Now we are waiting for the bill but the medical care was not up-to the standard expected in ER which we have told the hospital in a feedback form. Should we complain or contest the bill?

US news article blog by Kimberly Palmer reports more problems with her hospital visit.

The statistics there are startling. Each year billing errors run more than $100 Billion in health-care alone.

Wrong billing in cellphone, Internet, wrong refund, rebates missing …, redeeming airline miles, I can go on what we can expect to be hit with.

A wrong bill on the service providers part is a serious drag on our personal resources and the economy as a whole. Its a hassle to call them and go through the telephone tree and speak with an agent, sending email works may be in two working days or so. Then you have to actually talk with the agent who may not want to recognise the problem or email more redundant information.

But its clear that nothing is going to happen till we call them up or email. Only when we as consumers become vigilant by calling and registering complaint we can get them to work better.

Terry Cullen has a nice article on how to complain effectively . The most important thing she mentions is to be patient in conversation and be armed with all the information.

To bypass the phone tree she recommends gethuman and Bringo for long hold times.

So look at your bills to see any errors, get all the information try the above links if you need to speak to a rep and be patient when talking.

These are times of subprime mortgage mess and liquidity crunch. Banks are partly to be blamed for risk assessment along with the Fed.

But new credit scoring information can change things.  These enhanced credit scores will record how good are you with paying your utility bills and rent. Many other things like public records, tax liens, criminal records go into these credit scoring models. Be careful, No bounced checks for bills, it can pull your score down.

These new scoring models will be extremely helpful for those starting on a good Job but with no history.  This is welcome since it gives a better idea of who is responsible with paying bills. Experian is late in this game but TransUnion and Fair Issac are already using these information in their models.

It may take a few years before these new developments trickle down the marketplace of Loans but for immediate credit score solutions with limited history try http://prbc.com.

ETF’s Have recently gathered a lot of interest and attention all over the financial world. But what does it mean for the individual investor?

For an individual investor, the most important thing is to preserve capital and reduce cost and tax implications while making regular investment. Overly aggressive investing require lot of time and resources and cost more in trading and taxes.

The basic old school of ETF’s remains attractive because of the following reasons.

• It offers the benefit of indexing at low cost. This can compare with index mutual funds also. The low cost structure comes from the fact that there is no need to keep paying fund mangers to actively allocate stocks. The ETF SPDRs (SPY), which tracks the S&P 500, charges investors 0.09% and the similar index fund Fidelity Spartan 500 Index Fund (FSMKX), charges investors just 0.1% annually.
• Tax structure benefit for ETF’s is because they don’t sell the underlying stocks when investors depart, wile the Mutual Funds sell the stocks to pay the investors and that means a capital gains tax hit for remaining investors.
• Instant pricing offered by ETF’s is desirable over pricing at timing of market closing which is typical of Mutual Funds as one can take real time action instead of waiting for the day to end. HoweverETF prices have Ask-Bid spread (nice analysis @mymoneyblog) at any time and are not traded at NAV as the mutual funds. High ask and bid price difference can mean accumulating trading loss for active traders but even buy and hold investors should be watchful of spread and track the patterns in historic data.
• ETF’s have no restrictions on amount to invest, number of times it can be traded, exit cost and financial penalties as associated with Mutual Funds which ask for minumum investment, front load, back load or early redemption fees.
• ETF’s offer a way for diversification in foreign markets, and commodities. This when linked to an established index is transparent enough and still offers the benefit of low cost.

There has been a proliferation of ETF’s recently, its best for individual investors to stick to established indexes and ETF’s in which the cost is low. A low cost ETF usually means a large investor base so that they can over the expenses of running the ETF easily. This has been a problem for some ETF’s and they had to close down while their long therm investors had to take unexpected tax hit. Also individual investor can look up at the historical data for a longer time for a well established ETF in terms of Ask-Bid Price.

With the brokerage costs coming down the old school ETF’s can be attractive for individual investors. Do your research and let ETF’s or low cost index mutual funds out you ongrowthtrack.

PN

We all like functional and inexpensivefurniture, however it’s so rare.

There are a few ways to cheap furnishing …

Track the moving sale, however you won’t get it when you want it …, you wont get every thing you need to all the time. If you are moving into a new place and need to get jump-started on low budget …

I recommend IKEA, and going there with a U-Haul. I have seen people travel across a state to shop there. If you need to get a lot of things, midweek is the best time. weekends are good for a casual visit, as it is over-crowded at that time, get their early if you can to get a good parking spot.

IKEA ’assemble it yourself’ furniture are simple and good offer functionality, I have assembled a bed, bookshelf, bar-stools in my house, I love it every day. 

But before you visit IKEA which can be overwhelming experience, I recommend doing the homewok.

Study the catalogue, note the 9 digit item number, its the most important, else you will spend all your time dealing with the information overload in the store.

Enter through the ‘as is’ section for bargains,  (no warranty, no returns). This is usually located near the returns. Do not let them trick you into visiting the whole store before you reach the bargain section. Some people exclusively shop at the ‘as-is’ and the items there change often durign the day. The IKEA folks in ‘as-is’ are helpful if you need to decide on some item, they will also give you tips on minor touch up’s and how to take things apart etc.

As soon as you are done with shoping in ‘as-is’ proceed to locate all other things with the 9 digit code, ask an IKEA person for help in locating, you will save a lot of time.

If you dont have a tool box make sure you buy it there, its inexpensive, like $6 or so.  

I do not recommend their assembly service if you have very basic familiarity with woodworking. If you already have your truck or U-Haul, you are all set and dont need the delivery except very large peices like a odd shaped sofa.

Most of the work begins after you reach home, be patient in assembly. For bed frames don’t forget to buy the mid beam and slats. Make sure you buy every thing you have decided in your homework. Else whole trip will be a waste and you will have no alternative but to visit again. They don’t offer internet shopping for most of the products.

You also may want to get other household stuff there, the prices are better than sams-club on many items. 

Meals are inexpensive but there are no veg options, you can get hungry and thirsty, I recommend carryign some snackbar and water at-least.

I have some friends who don’t like the IKEA minimalistic look, but I love it for its functionality and affordability. In any case you are better informed with reaearching their catalogue and planning for a visit. In case you get an IKEA coupon, Please make shure its valid in the store where you plan to visit.

 In case you are using zipcar, you have good parking spots reserved in Stoughton, MA. Zipcars are cool, however, I would use U-Haul and combile the trip with some one else for our furniture shopping.

One planned visit to IKEA and with in a week you will be back ongrowthtrack with no lack of functional furniture holding you back.

PN

This week the Business Week magazine has posted an interesting cover story which can be summed up as Being Poor is Costly, Frugality and Discipline paves the way out.

It has a lot of examples of how poor people continue to remain poor. One can blame the industry, but still a real person is making choices (uninformed in most cases).
Why does it cost so much to be poor, its more complicated than we think.

• Lack of access to affordable financial products and services. Any time there is a credit check, either financial service is denied to poor people or comes at very high price. This is true for getting any loan, mortgage, insurance and credit cards.
• Feel rich quick marketing. This really gets people into trouble as the initial cost for financing the so desired stuff seems less but the total cost of ownership is can be as much as twice when compared with someone who has good credit.
• Another aspect of feel rich quick marketing is that it pushes a lot of stuff to people which is something they never need. It takes a discipline, thinking through and accepting frugality as a virtue to say no to stuff one does not need.
• Not Shopping around enough. Shopping the right thing takes effort as well as discipline, its also requires doing homework collecting information and analysing ahead of purchasing. The more one does such kind of homework the better one gets at it. But before one can undertake such a homework people need to know this is indeed possible to do than just relying on the first offer they see jump in excitement.

What is the way out? Its simple but takes time, patience and discipline to follow.
Embracing frugality and appropriateness, discipline of doing the homework and analyzing the details can help one stay out of financial trouble. But these virtues are equally applicable in other aspects of personal growth, may be in slightly different ways. As one gets on the growth track with patience and discipline, moving ahead on the track becomes easier, one finds more opportunities to continue on the growth track and it becomes self sustaining and nurturing as out self-discipline and habits improve.

When we make the correct choice, we move on the growth track.

PN

BusinessWeek

Purchasing grocery at Stop n Shop is really simple if one keeps in mind the following rules.

1. Get the weekly circular, you can get it on-line also on their site. This comes on Thursday every week and is valid for a week. Do the homework, go with a list.
2. Look for the things that are on sale, things that are on “everyday low price” are not the lowest.
3. Look for sore brands when shopping and buy in multiples of two.
4. Coupon insert from Sunday newspapers are helpful, use coupon for the smallest size item. Coupon clippers are helpful if you need somethign in particular or somethings in large quantities.
5. Pay attention to 10 for $10, kind of deals, you need not get all 10, getting even one gives you the 10 for $10 price.
6. Monitor price for all the items that you purchase / interested, use a spreadsheet if necessary, you will be able to spot the lowest price.
7. Items on sale change every week. Stockpile when you see something.
8. Always check the receipt for errors after you have checked out, errors do happen, Promptly visit the customer service in that case and get it resolved.
9. Ask for rain checks if item on sale is unavailable.

Smile, watch your savings grow by smart shopping at shop and stop. I guess most of this will be applicable at other stores also.

-PN

Consider the following for what’s worth your dollar and more:

Do you buy Premium or regular?

Do you buy spring clothes in late winter?

Did you buy the best prosumer camera / cellphone / laptop/ gadget in the market?

Do you upgrade to business class / first class by paying wile travelling?

you deserve the best

Chances are, this message is a seed for an answer of yes to any on the above questions.

While we enjoy the feeling of what feels best and what money can buy we loose sight of whats appropriate and how appropriate is the best.

By Appropriate, I mean what gets the job done with the minimum extras, just like most of us would choose regular fuel if premium is not strictly recommended.

However things may get complicated when we perceive a deal as in the airline upgrade, and there is a bit of us that deserves the best to complicate it. How does one deal with such a situation? There is no easy way out, but personal experience or information from other’s experience. When we are ready to do a even headed comparison of value and cost regardless of MSRP and our feel good feelings, we are making a good choice.

To start with

Prepearation ahead of time.

Shopping around and having the data recorded.

documented experiences from other sources (good blogs are great) are your best guide.

Next

when we have the data and armed with knowledge we will know what are the key questions to ask and what are the considerations for getting what’s appropriate. This will certainly help you deal with the most pushing sales person face to face or on the phone.

Don’t give me more, don’t give me less, don’t give me the best, let me get what’s appropriate for me after I have done my homework.

PN