Tax Season Means Tax Refund (For Us, at Least)

It’s that time of year again, when many personal finance bloggers start telling folks that it’s better NOT to get a big refund when they file their taxes. While I agree with the theory, it’s not my personal preference. I’d rather let Uncle Sam hold onto “my” money and then get it back in a nice, big chunk that’s direct-deposited into our bank account.

But not all personal finance bloggers think getting a tax refund is a bad thing. For those who suck at saving money, it’s a way to automatically keep that money aside, then get it in one big windfall come tax season. Sometimes, you have financial needs that are better met with a little extra in your paycheck each week. Either way, there’s no real right or wrong answer. It comes down to personal preference.

Tax Refund – Pros

If you’re like me and work more than one job, you might want to keep the number of exemptions on your W-4 at “0” — any more than that, and you could wind up owing Uncle Sam come April. I pay my own taxes on my freelance gigs, so I don’t want to get caught short.

Others like knowing that they’ll get a “windfall” each year. Homeowners tend to get the biggest refunds, thanks to deductions on mortgage interest and property taxes. And here in New Jersey, those two costs can really add up. Getting about 1/3 of it back each year is a minor consolation for our high costs.

Tax Refund – Cons

Right now, savings accounts barely pay interest, but on a nice chunk of money, you could get $50-$100 a year on money that would otherwise be held by the government. Some people in this economy really need the extra funds in their paychecks to pay their bills, while hard-core investors prefer to take their chances on the stock market moving in their favor.

And then there’s the “don’t let the government keep your hard-earned money!” argument.

In the End

It’s up to you whether or not you want to adjust your W-4s to minimize (or maximize) your tax refund amount. But before you make a big move, gather some of your financial information and check out the IRS withholding calculator. It’s estimating that we’d get back about $7,000 as a tax refund next year. Since our salaries are holding steady for 2012, let’s see if this year’s refund will be about that much. In the past two years, it’s been a few thousand dollars less because of my freelance work. But I’m not complaining.

Do you like getting a tax refund, or do you adjust your withholding so your refund is minimal?

Confession: We’re Overspending

Our credit card balance is still much higher than it should be, even with us making major payments toward it. We went overboard at Christmas, with a laptop for my husband and a new desk for my home office for me, gifts for Baby Frugalista’s first Christmas, and also had bought a new TV stand with a hutch for our living room to replace the old unsafe stand meant for an old-school TV. While we have been upgrading our furniture in the past year, it’s the first time I’ve done so in 8 years. These new items are sturdy and well-made, and I hope they’ll last us 10-20 years. So they’re not everyday expenses. That being said, it’s time to put the credit cards on “freeze” and stop using them until our balance is paid off.

The good news is that about 2/3 of our credit card debt is at 0% interest through the summer. I’d originally wanted to pay it all off by March, but now I see that won’t happen. I could use some of our savings to pay it off, but I’d rather keep that account untouched because it’s our emergency and house-repair fund. Instead, I’ve been freelancing and selling a few of our old things, such as furniture pieces, and using that money to pay down the debt. I will have the one credit card that is charging us interest paid off by March, at least.

Little Bites

— Baby Frugalista is almost 1 year old! I can’t believe how quickly time flies. We’ll celebrate her Groundhog Day birthday with a little cake and thankfulness that our preemie is thriving — you’d never know she was only 4 pounds when she came home from the hospital.

— Also one year later, I’m finally getting closer to my pre-pregnancy weight. 14 pounds down, 10 to go. Not too shabby for doing it through the December holidays and all the food that comes with that time of year. I’ve also been jogging on the treadmill at the gym a few times a week, and I can do about a mile in one shot. Which is absolutely amazing, considering my previous record was 1/4 mile… at the age of 19. If I ever get pregnant again, I will NOT gain 45-50 pounds. And remember, I only had a 4.5-pound preemie!

— New year, new health insurance. And higher co-pays for my birth control pills. My husband’s employer claimed everything would stay the same, but I guess the prescription drug list is different for this company.


Little Tikes Cozy Coupe Assembly Nightmare

But look, it has googly eyes!

Three-and-a-half hours. That’s how long it took me to put together one of Baby Frugalista’s Christmas presents, the ubiquitous little red car many of us had as kids called the Little Tikes Cozy Coupe. I bought it because I had fond memories of playing with it at my cousins’ house, AND I got a great deal on it post-Black Friday.

It was the last thing left for us to assemble after Christmas. At first, I was just going to leave it in the box until spring, but the hubby suggested we put it together now, and I acquiesced. And I figured I could do it all by myself. With all of our newfound experience in assembling the baby’s other toys, this would be a snap.

Boy, was I wrong.

First of all, we were missing half of the directions. Yes, we scoured the inside of the box to see if it got stuck in the cardboard somewhere. It didn’t. Then, instead of opening the directions flat, I had it folded in half, looking only at the left page. This caused me to put it together out of order and screw it up. But to be fair to myself, the directions were terrible — unclear and almost impossible, even for someone like me, who can put together almost anything with barely a glance at the directions. ::brag::

The problem with putting it out of order? The wheels were now screwed up because I forgot to add the spacer to keep them away from the frame of the car.

After getting to the end of our half of the directions, I searched the Internet, hoping to find the rest of the directions by typing in “Cozy Coupe assembly.” While I did find the directions (printed AND video-demonstrated), I also stumbled upon a whole slew of message boards with comments from other frustrated parents who thought this Cozy Coupe was by far the worst kids’ toy they’d ever had to deal with assembling.

I also discovered that most of the parents also screwed up putting on the wheels. And that the manufacturer included extra parts because they KNOW most people will screw it up. It took both me and Mr. Not-So-Frugal to pry off the “acorn nut” caps that held the wheels to the frame in order to install the spacers, and it involved two pairs of pliers (needlenose & regular), two screwdrivers (for prying) and a hammer. The extra parts? Those acorn nuts caps.

So now, our almost-1-year-old daughter has her Cozy Coupe. She currently enjoys being pushed around the house in it — there’s a removable floorboard so her feet don’t get run over. I’m glad that she likes it and hopefully, she’ll use it for years to come.

A few days later, I was talking to my aunt, and I was complaining about how hard it was to put together this simple Cozy Coupe. Her response? “It was 25 years ago, but I remember it being a pain in the ass for us, too!”

Little Tikes, are you listening? Sheesh.

Splurge or Skip: Home Remodeling Upgrades That Pay Off

The following is a guest post.

Although most home remodeling projects wouldn’t be categorized as “splurges,” many are based less on necessity and more on funds available and the possibility of a good return on investment (ROI). But how do you know which home remodeling renovations are worth shelling out the cash for or are better for using home equity, and which ones you should skip? Read on to find out just how good a return some of the most popular home projects offer.

Depending on where you live in the country, most home remodeling projects don’t offer the dollar-for-dollar return of the past. According to First Realty, you should always be sure to keep your home’s property value within 15 to 20 percent of your neighbor’s. With that in mind, consider these ROI guidelines when deciding which home projects to start:

80-100 percent ROI:

  • Energy-efficient fireplace – The addition of a vent-free gas fireplace will likely have the highest return on investment of any upgrade you can make. And until you sell, it’s a great way to help heat your home in the colder months.
  • Kitchen remodels – A kitchen remodel is often one of the best investments you can make to your home. Whether putting in all new appliances or installing new cabinets, counters and floors, close to all of the cost will probably be recouped when you sell.
  • New bathroom or renovations – Adding an additional bathroom or upgrading the ones you have can have a very high return. Whether it’s a new vanity, tub or even new fixtures, the money you put into your bathroom will typically have a high ROI.
  • New room addition – If you’re thinking about adding a family room or an extra bedroom onto your house, consider the high ROI you can expect in return.
  • Master suite remodel – This often-simple upgrade can really pay off in the long run and sellers often recover most of the cost. Think about closet organization, new floor covering or even a fresh coat of paint – most master suite costs will probably be recouped.
  • New windows/doors – Not only do these upgrades help with energy-efficiency, they can give a facelift to the look of your home.

60-70 percent ROI:

  • Deck – Most buyers like the look of outside living space, but until you’re ready to sell, you’ll enjoy the time spent on your new deck long after it’s paid for.
  • Finished basement – Finishing your basement not only adds to the square footage of your living space, but it typically offers a good return.
  • Remodeled garage – While a garage renovation may only pay off a little over half at point of sale, a clean, dry garage is always a good selling point.
  • Landscaping – A great way to enhance your curb appeal yourself, landscaping can be an inexpensive way to update the look of your home and attract potential buyers. However, keep it simple. What catches the eye of some may be off-putting to others. At the very least, keep the lawns well-groomed and make sure weeds are at a minimum. Add one pop of color, whether it be a hanging flower basket in the summer or a bright pot of mums at the front door in the autumn. You want landscaping to add to the look of the home, not detract from it.

50 percent ROI and under:

  • New heating system – Save money on energy costs and recoup almost half of spend with this upgrade.
  • Exterior painting – While painting the outside of your house is time-consuming, doing it yourself can be an inexpensive project that could really pay off.
  • Siding – While new siding may only reach 35 percent ROI, if you’re not interested in maintaining your home’s paint job every few years, this may be a great alternative.
  • New roof – Re-roofing may not earn much back, but it may help your home sell for what it’s really worth, and that may be just as important.
  • Skylight – While a skylight may be a great way to add natural light to a space, the addition of a skylight does little to raise a home’s value, making it one of the least beneficial investments you can make.

Whether you intend to invest in your home for your own use or to increase its resale value in the future, these guidelines will help you make wise money decisions for your family. And if you’re looking to make any of these home remodeling upgrades in the near future, consider using your home’s equity to finance your next project. Flexible home improvement financing is available and could be a great way to utilize the valuable equity you’ve built in your home.

We Got an Amazing Verizon FIOS Promotional Deal

It was just a whim, to look at the Verizon FIOS website to see if we qualified for any new promotional contract deals. The Verizon FIOS deal we wound up with is so amazing, I have to share it with you.

Our original two-year FIOS triple play contract (phone, Internet & cable TV) expired this past June, and our promotional price went up by $10 per month. In this original packaging, the ‘triple play’ portion was $95, which was the Extreme HD channel package plus $32 for the full movie package — Mr. Not-So-Frugal cannot live without ALL the movie channels. We were rewarded with a $150 prepaid Visa debit card for going under contract for 2 years. After the contract expired, the pricing went up $10, for a package total of $137. We’re still charged for the DVR & set-top boxes we have in the house, along with all the requisite taxes and fees.

When I looked on the Verizon FIOS website, I saw that we could upgrade to the Ultimate HD channel package which includes more channels and all the movie channels except for Starz and HBO, which would cost extra. The internet and phone service would also be upgraded to be faster and include more features. The total would be $135 for the package with a 2-year contract. The kicker? A $300 prepaid Visa debit card just for committing to 2 years of service.

As I tried to figure out how much more it would be to include HBO & Starz in the package, I saw that there was another special promotion, including those two premium channels at the same price. It seemed too good to be true, so I started a live chat with a Verizon customer service representative, who was very nice and confirmed the HBO/Starz channels would be included in the pricing.

So not only will we be paying $2 less a month, we’ll have nearly 100 more channels (crazy talk), faster Internet service (from 10/2 mbps to 25/25 mbps), and the new digital voice phone service with upgraded features.

Old month-to-month package:

  • $137/month for phone, TV & Internet
  • $150 prepaid Visa debit card

New promotional 2-year package

  • $135/month for phone, TV & Internet
  • $300 prepaid Visa debit card

I feel like we hit the jackpot. These are internet prices, so we got a great deal. Plus, it’s so much easier to order this stuff online, rather than talk on the phone to someone who’s just trying to upsell you.