5 Lesser Known Perks of Costco Membership

Costco SignEveryone knows about the cheap Costco gas and the wonderful Costco return policy (though on electronics it has certainly lost some of its teeth), but there are a lot of lesser known perks that members should try to take advantage of. Here are just five of them.

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The Age of Speed by Vince Poscente

The Age of Speed by Vince PoscenteThe Age of Speed by Vince Poscente is written for two types of readers. The first is the employee who feels overwhelmed by the speed of work and how pervasive it has become in our daily lives. From email and cell phones to the always-available Blackberries (Crackberries!), employees are no longer able to distinguish work and life by geographical location. Work is quickly permeating personal life and it’s an erosion that endangers the employee’s mental health!

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 Personal Finance 

Riddle of Steel Roundup

Brip Blaps talks about the riddle of steel, which is a direct reference to none other than Conan the Barbarian. “Over the last couple of months we’ve all learned that some of the advice that we’ve been handed over the years will not be easy to swallow. Learning to live within your means and invest in index funds and network to maintain your job are all nice, friendly pieces of advice when the economy and the market are headed in a never-ending positive direction…. Now for my generation (Gen X) and the rest of the country it’s time to learn the riddle of steel.” Credit-fueled spending isn’t going to get you into Valhalla.

It’s important to challenge your assumptions. Here’s a simple example everyone can relate to and it involves a story I read at One Caveman’s Financial Journey. Caveman has been buying ground beef in bulk at his local warehouse store for at least four years and always picked up a 6 lb. log, what he thought was the cheapest per pound price. For years, he overlooked the larger meat logs because he thought they were sausages. Well, recently he went ot the store and saw his favorite 6 lb. meat logs were actually 5 lb. meat logs and a little more expensive, so he gave those weird sausage products another look. Turns out they were 10 lb. meat logs that were thirty five cents a pound cheaper! How many times have you made assumptions only to realize they were wrong? Fortunately this wasn’t a huge oversight, he estimates he’s spent about a hundred bucks more over the course of four years, but it’s a good example of how you should always challenge your assumptions.

I used to read Dan Melson’s Searchlight Crusade all the time when I was buying a home. I stopped reading it as much the last few years because I wasn’t planning on buying a home and didn’t really need his expertise. The other day I had a reason to stop by his site and was once again reminded how well informed he is (it’s partly his job) and how well he explains certain topics. In fact, a post this week tackles the very problem that David of My Two Dollars was facinghow to qualify for a loan with irregular, 1099-MISC income (it talks about more than that). If you’re going to buy a house in the next year or two, read Dan’s stuff. (Oh, also check out his Consumer Focused Carnival of Real Estate)

Lazy Man always asks himself five question before he buys something, it’s a good process to go through sometimes our brains run on autopilot. We buy something because it looks good or was pitched well, but we never ask ourselves the five questions Lazy Man does.

Finally, I leave you with this thought – Is the Baby Boom Generation the Shallowest Generation?


Scratch Beginnings by Adam Shepard

Scratch Beginnings by Adam ShepherdI really enjoy books that give a glimpse into another lifestyle. That’s why I enjoyed Trading with the Enemy, in which Nicholas Maier describes his experience working for Jim Cramer at his hedge fund. That’s why I enjoyed A Million Bucks by 30 by Alan Corey, which was the story of how Alan “overcame a crap job, stingy parents, and a useless degree to become a millionaire before (or after) turning thirty.” When I was asked to check out Adam Shepard’s book, Scratch Beginnings, I agreed. Scratch Beginnings is a true story, written in Adam’s own words, about him starting literally from scratch with $25 in Charleston, South Carolina.

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 Your Take 

Your Take: Are You Happy At Your Job?

Free LemonadeYahoo HotJobs recently published a list of the top ten happiest jobs and, surprisingly, professional blogger did not make that list. Who did? Clergy took the top spot with a reported 67.2% “very happy,” far exceeding numbers two (firefighters, 57.2%) through ten (airline pilots and navigators, 49.1%). In addition to listing the percent “very happy,” they also listed salary for someone in that role with 5-9 years of experience. The highest paid were #7 science technicians with a median salary of $72,435 and the lowest paid were #3 travel agents with a median hourly rate of $14.23 (or ~$28,000 if you assume a standard work schedule).

There isn’t much you can take away from lists like this, except we can ask ourselves how happy are you? I’d say I’m about 70% very happy. I get to set my own hours, I get to work on my own projects, and I get to reap the fruits of my labor. The 30% unhappy goes to how I have to figure out what projects I’m working on, I suffer the consequences of poor decisions, and I have limited social interaction with other people.

One interesting thing is that my stress is a little different. Before, I’d be stressed out over presentations to clients and whether I’d screwed up. Now, I’m stressed whether I’m making the right strategic decisions; decisions that won’t prove right or wrong for months.

How about you? Are you happy at your job? How many percent and what affects it either way? Would you trade less happiness for more money (or vice versa)?

(Photo: tinfoilraccoon)

 Personal Finance 

How to Lose $602,999 In Thirty Seconds

Deal or No Deal is a popular television game show in which the contestant picks a case out of the hundred on stage. That case is theirs to keep and the “Banker” tries to buy that from him or her. Then, as the game progresses, the contestant picks numbered cases to be revealed and removed from the stage. As the game progresses, a large board tracks which cases have been removed and, based on probabilities, the “Banker” offers to buy the contestants case. Normally, the show has only one million dollar case but in an effort to make things exciting, started offering multiple million dollar cases.

In this particular episode, there were 7 million dollar cases. Watch what happens:

The part that boggles my mind was when one of his three friends, perhaps his wife or sister, says – “You came to bust him, and you’ve done it….” I thought she was giving him a reason to stop, but then inexplicably adds “One more time…”

As my wife always tells me, sometimes you have to take a step back and be thankful for and appreciate everything that you have. $603,000 is a lot of coin.


Protecting Money With CDARS & Treasury Notes

Fat Wad of CashFor the last few months, until Congress raised FDIC insurance to $250,000, a lot of people were absolutely freaking out about their banking deposits. The largely symbolic move from $100,000 to $250,000 affected practically no one at that point but it made me wonder how the wealthy protected their liquid assets. I didn’t consult with any professionals on this but there are two very simple ways: CDARS (Certificate of Deposit Account Registry Service) and Treasury notes.


The Certificate of Deposit Account Registry Service is something that your bank may offer and it can protect your deposits for up to $50 million. The program is very simple and essentially handles the paperwork of opening up Certificates of Deposit at multiple banks. There is a “loophole” in the FDIC insurance in that it covers you for $100,000 ($250,000 until December 2009) per person per institution. CDARS offers $50 million in protection because they open up CDs at multiple partner institutions. You could do it yourself, but they are simplifying the process and likely taking a little bit in interest to pay for expenses and make some money (I wonder how those rates compare with the best CD rates I’ve found?).

Treasury Notes

All Treasury Notes are backed by the full faith and credit of the United States government. Should that level of infinite insurance fail, the dollar would be worthless and your last concern would be over your deposits! We saw many institutions rush to put their money in short term notes when the credit crisis hit its apex a month or so ago and that was because those notes are protected 100%. As a consumer, you can buy Bills, Notes, Bonds, and Treasury Inflation-Protected Securities (TIPS) through Treasury Direct, the Treasury’s online management system.

For people like you or me, opening up a few high yield savings accounts will probably be sufficient to cover our liquid asset protection needs.

(Photo: refractedmoments)


How To Calculate Blended Interest Rates

A blended interest rate is an interest rate over an amount where parts of that amount are charged, or earning, different interest rates. Blended interest rates are useful in making important comparisons between different offerings such as mortgages or high yield savings accounts.

With mortgages, the math is simple. You’re calculating the rate based on two separate sums. With a bank, it’s slightly more complicated because you are often accruing interest at one rate for part of the year and then accruing it at another rate for the rest of the year. We’ll explain both.


In the home mortgage example, let’s say you have the choice of getting one loan at $100,000 for 6.00% APY or two loans – one at $80,000 for 5.75% APY and one at $20,000 for 6.50% APY. Which is better? In order to make the comparison, you need to calculate the blended interest rate. Fortunately, it’s an easy calculation.

Take each amount and multiply it by the interest rate. Then add all those numbers together and divide by the total amount. In the above example, that would be:

($80,000 x 0.0575 + $20,000 x 0.065) / $100,000 = 0.0590

The blended rate is 5.9%. It is better to get the two loans.

Mortgages Blended Rate Calculator:
Of course I couldn’t leave you hanging without an easy way to calculate this (no commas or dollar signs please):

First Loan: Amount: , Interest Rate: %
Second Loan: Amount: , Interest Rate: %
Third Loan: Amount: , Interest Rate: %
The blended rate is: %

NOTE: You can also use the above calculator to figure out your blended rate of return on multiple investments with different interest rates, it’s the same equation whether you are earning or paying interest.

Bank Interest

Now we get to the example of one sum accruing interest at one rate for part of the year and at another rate for the rest of the year. This is common if your bank offers a promotional rate for new account holders. Everbank is good example – they offer 4.01% APY for the first three months, then 3.21% APY thereafter.

The first step is determining the APR of both rates. Assuming a monthly period, the APR – APY Calculator tells us that the rates are 3.93% APR and 3.16% APR. Dividing each by twelve, we learn that for the first three months your balance will increase by 0.3792% and then increase by 0.2942% thereafter. The blended rate is:

= ( (1+r1/tp)^r1p x (1+r2/tp)^r2p ) – 1
= ( (1.003275)^3 x (1.002633)^9 ) – 1
= ( 1.00985721200 x 1.0239481162 ) – 1
= ( 1.0340414 ) – 1
= 3.40% APY


  • tp is the total number of periods, in our case it was 12,
  • r1 is the first period’s interest rate (APR),
  • r1p is the number of periods you get that promotional interest rate,
  • r2 is the second period’s interest rate (APR),
  • r2p is the number of periods you get that second interest rate (we limit it to 12 months to calculate APY).

To makes things simple, here’s a quick and dirty blended interest rate calculator.

First Period: Interest Rate: % Periods:
Second Period: Interest Rate: % Periods:
The blended rate is: %

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