Wednesday, August 30, 2006

An Apple Doesn't Fall Far...

My brother's family was in town for a few days last week. My ten year old nephew, in particular, is just the sweetest and most thoughtful kid in the world. But I was reminded that kids say and do the darndest things.

We were shopping for souvenirs at Navy Pier, and my nephew is totally into glass sculptures and crystals. Apparently, he'd been saving his pennies for this trip since early April. And he was about to buy an $8 crystal pendant for himself when his dad pointed out that the pendant should be worn by a girl. So, he paused and thought about it for a few seconds, and then decided that he wanted to buy it for his little sister. But when he went up to the cashier, he asked her if he could buy it for $4 instead of the $5 that was posted on the sign. The woman, who was talking on her cell phone at the time, agreed to accept $4. So, then my nephew decides that he wants to buy a larger crystal to hang in his room. And again, he went up to the cashier and asked if she'd accept $1 less for the item than the price that was posted. This time, she wouldn't budge on the price. So, my nephew just shrugged and handed over his hard earned $8.

When he came over and explained what had happened, I was absolutely amazed that he'd haggled with an adult. Where did he learn to negotiate like that? God only knows, but I suspect it's from observing his frugal dad.

Friday, August 25, 2006

Sellers with Positive Feedback

I purchased a new, unused textbook yesterday from a private seller on Marketplace for half the advertised price of other online booksellers. But I found myself waffling between one seller who had 93% positive feedback but the lowest price and another seller with 98% positive feedback but a higher price. I wound up going with the seller with the 98% positive feedback. But I'm wondering whether that extra 5% of positive feedback was really worth an extra $5?

As I mentioned in the past, I've been selling stuff on Marketplace for the past few months. And right now, I have a 100% positive feedback rating (knock on wood). I attribute my good fortune to the Golden Rule. Do unto others as you would have them do onto you. Having had some not so great experiences with other sellers, I've learned from their mistakes. Things like inaccurate descriptions or inadequate packing materials, drive me crazy.

Anyway, I'm wondering if it's just me, or do other folks pay a lot of attention to feedback ratings? If yes, are you willing to pay a premium to purchase something from a seller with a higher rating? And finally, what's your price point? Are you talking an extra $5, $10, $15?

Thursday, August 24, 2006

You're Right...I'm Wrong

Thanks to all of my readers who pointed out that I'm a complete idiot and left money on the table by frontloading my 401(k) contributions. What I really should have done was to contribute at least 5% per pay period for the rest of the year to take advantage of the company match. As it stands, I'm losing out on $2,000 of free money. But in my defense, I thought I was going to quit my job this year and go back to school this fall. So frontloading was the only way I could have contributed the maximum amount before I left the company. Live and learn.

As for next year, I'm going to have to frontload my 401(k) again because I'm planning on starting grad school full time in the fall. C'est la vie. The $2,000 match isn't enough to keep me on the job for another year.

Friday, August 18, 2006

....And the Effect on Company Matching Contributions

A reader asked a great question yesterday in response to my last post about frontloading my retirement accounts. In terms of the company match for my 401(k), do I get more or less money if I fully fund my account within the first 6 months vs. over the course of the entire year?

According to our company website, eligible employees "receive dollar-for-dollar matching contributions...on the first 5% of...benefits pay contributed each pay period." As far as I can tell, there's no dollar cap associated with each paycheck. So, if I contribute the full $15,000 (the 2006 tax limit) in 12 pay periods, as opposed to 24, the company match would still be $750 (5% of that $15,000) for the year. And since the company match is deposited in my 401(k) account immediately, there's the added benefit of time. That $750 will be earning compound interest or dividends for me for at least an additional 6 months.

So, if my reasoning is correct, there's really no down side to frontloading my 401(k) when it comes to the company match.

Thursday, August 17, 2006

Frontloading My Retirement Accounts

Each year I frontload my retirement accounts, meaning that I invest the maximum amount in my IRA and 401(k) at the earliest opportunity. In terms of my IRA, I try to make my annual contribution in January. In terms of my employer sponsored plan, each pay period, 20% of my salary is deposited into my 401(k) account. That means that during the first half of each year, my takehome pay is substantially less than what it could be. But since I don't ever see that money, I never really miss it. And around this time of year, after I've maxxed out my 401(k) contribution, there's a really nice surprise waiting for me in the form of a huge bump in my takehome pay. Of course, when I see all of that extra income sitting in my checking account (the beauty of automatic payroll deposits), there's a huge temptation to blow it all on something frivolous and fun. But that's where discipline and goal setting and bit of trickery come into play. Cause again, if I don't see it, I won't touch it.

So, as an added precaution, I set up an automatic transfer. In other words, at the beginning of each month, before I can dream up ways to spend it, that extra cash is swept from my checking account (which I check on a daily basis), into my HSBC savings account (which I only check once a month.

Monday, August 07, 2006

Faith in Humanity Restored

Earlier an earlier post today, I mentioned that a buyer emailed me to ask me about the status of a product that I had shipped to him last month. I jumped the gun and assumed that he was claiming that the product never arrived and therefore wanted me to initiate a refund. Well, it turns out that this particular buyer lives and works in China, and he had asked me to ship the item to his parents house. When he asked his mom about it, she told him that she didn't have it. But apparently, she had forgotten that she'd already forwarded it to him, along with another item that he was expecting. The buyer was very apologetic, explaining that he just wanted to pinpoint where the item was (in transit or still at his parents house). And then he promised to leave me excellent feedback for my prompt communication. So, all's well that ends well. The moral of the story is that you should always be polite to your customers, even when you suspect that they're trying to pull the wool over your eyes :-)

Misdelivered Mail or Dishonest Buyers?

Some of you may know that I've been selling some random, miscellaneous stuff on Marketplace. Well, last night I received an email from a buyer who wanted to know when/if I'd shipped his order. Mind you, I always ship things the next business day. But this is the second time that this has happened to me. As I mentioned in an earlier post, the first time a buyer emailed me (claiming he didn't receive his order), I initiated a refund, no questions asked. But now, I'm starting to wonder whether the guy lied to me? Because this second time around, I paid the extra sixty cents for delivery confirmation (it was a relatively expensive order). And when I plugged in the confirmation number at the USPS website, it indicated that the package was delivered on July 10th. That's nearly a month ago. So, I sent the buyer a very politely worded email, indicated that the package had been delivered, gave him the confirmation number and suggested that he talk to his postal carrier. But I wanted to give him the benefit of the doubt, so I also asked him to confirm that I had the right mailing address, even though I printed the shipping label directly off of using the information he provided with the order.

But, now I'm wondering if people do this all the time? Buy something and then try to get their money back by claiming that it somehow got lost in the mail? Or is the USPS really that incompetent?

Wednesday, August 02, 2006

Urban vs. Suburban Living - Haircuts

Everyone knows that the cost of goods and services is generally higher in urban settings when compared to prices in the suburbs. Which is why I typically shop for household stuff in the suburbs either before or after church, even though there's a Target and Walgreens within walking distance of my condo. But for things like haircuts or dry cleaning, I generally bite the bullet and pay city prices.

This past weekend, I was complaining to a friend about my hair stylist, who works at an upscale salon in a trendy neighborhood. The first time that I got my hair cut by the guy, he did a wonderful job. But the next 5 or 6 cuts were pretty terrible. $45 for each visit, and all he did was trim the ends. My mom, who was training to be a beautician when she first came to the U.S., kept insisting that the guy was ripping me off. And before that, I went to a salon in Chinatown. But my regular hair stylist seemed to give everyone the same cut, regardless of whether it flattered the person's face or not.

Since my friend and I were out the western suburbs for a church leadership meeting, she had pity on me and offered to take me to her Korean hair stylist in the northwest suburbs. I figured it couldn't hurt to try something new. I was feeling pretty desperate at that point. Nothing like heat and humidity to make my hair go crazy.

Anyway, because my friend is a regular customer, the woman agreed to squeeze me in without an appointment. And boy, she did wonders with my hair. She only took maybe an inch at most off of the bottom, but she trimmed my bangs and put in some nice, long layers. So, now my hair lays nicely in the back instead of the crazy poof ball thing that it's been doing for the past few weeks. All this for $18! Plus a $7 tip because she did such an awesome job. I am definitely *not* going back to my old hair stylist.

One could argue that the total cost of the urban vs. suburban haircut was the same, when you take into account gas, wear and tear on the car, and the amount of time that it took to drive out to the suburbs. But I've gotten multiple compliments on my hair in the past few days (even my mom, the perfectionist, approved). So when all is said and done, the suburban haircut was worth it.