Ask Cheapskate, by Mary Hunt
You should see my inbox. Ouch! It’s brimming with questions, advice, stories, comments, rebuttals, and all kinds of love from you, my dear readers. Today, I’m making a small dent in the pile with these answers to a few of your questions about car leasing, homemade laundry detergent, and more.
Dear Cheapskate: My wife and I disagree. I want to rent a new car now because ours is old and paying for repairs is like throwing money down the drain. She wants to keep it until we can buy a better car. I hate car trouble and think peace of mind is something to consider. I’m sure we can afford the payment, but she isn’t. What should we do? -James
Dear James: I’d rather put toothpicks under my fingernails than rent a new car again, which is another story, but enough about me.
Here’s my best advice: do whatever you must to keep the old car running for now. Then, for the next 12 months, live as if you were making monthly lease payments of $400 – but make those payments to yourself. Don’t even think about being late, like you’re under a hard tenancy.
After a year, you’ll have two things: a good idea of your comfort zone for large lease payments and $4,800 in cash. Now you have options.
No. 1: You can sell the scrap and buy a used car with the money; or #2: You can make a down payment on a newer car.
To me, buying a car is much better than jumping into a lease where you’ll spend a fortune and have nothing, not even a car, to show off at the end of the lease term.
Thanks for writing and calling me “Cheapskate”. As you may know, I was a world-class spender (EverydayCheapskate.com/about), and it almost ruined my life. Learning to live frugally has changed my life, so I wear this nickname “cheapskate” with pride and joy.
Dear Mary: I am so confused about laundry products, especially detergents. Are powders better than liquids? Is the word “ultra” just hype? Thanks. — Cindy
Dear Cindy: Here’s the scoop on laundry detergent: Typically, the word “ultra” means the product has been concentrated to fit in a smaller can. The problem is that unless you read the label and measure and experiment carefully to find the minimum amount that works for you, you’ll probably dump the same amount you had in the past. Not good.
A product with fabric softener added will not clean or soften as well, but is generally cheaper than buying two different products if you insist on using fabric softeners.
If a product says it has more stain repellent, it contains enzymes to help dissolve stains better, but you’ll still need to pre-treat stubborn stains. Detergents with enzymes generally cost more than those without.
Generally, liquid detergents are more expensive and work better on greasy stains, but cheaper powder detergents are better on clay and mud stains.
Liquid detergent and liquid bleach will improve and work better if you add half a cup of baking soda to the wash cycle, which means you may be able to use less detergent. It only pays off when your soda products are less per ounce than detergent.
And now for my super laundry detergent-saving secret: I make my own homemade laundry detergent (EverydayCheapskate.com/laundry-detergent). Seriously. And it’s so cheap – about 5-7 cents per wash load. It has no fragrances or mystery ingredients and works better than any commercial laundry products I’ve purchased in the past.
Try. I think you will be pleasantly surprised!
Dear Mary: We have been putting money into a 529 plan for our daughter’s college education for the past few years. She recently told us that she wants to attend beauty school instead. Now that the surprise has worn off, we are worried about the penalties when we withdraw the money. How much are we going to lose and is there a way to avoid it? —Rebecca
Dear Rebecca: I have great news for you! This 529 plan money can be used at any accredited vocational or vocational school — not just colleges and universities — to pay for tuition, room, board, fees, books, and supplies. If you have more in the account than the total cost of vocational training and related fees, you can withdraw the balance.
Federal law imposes a 10% penalty on profits for unqualified distributions. This means that you will get back 100% of your capital and 90% of your winnings.
Another option is to change the beneficiary to another eligible child or family member to maintain the account and avoid (or at least delay) ineligible withdrawals if your daughter’s education doesn’t require these funds. Your particular fund may have additional provisions, so be sure to check with the fund manager.
Anyone can learn more about 529 College Savings Plans at SavingForCollege.com. Hope this can help!
Mary invites you to visit her at EverydayCheapskate.com, where this column is archived with links and resources for all recommended products and services. Mary invites questions and comments at https://www.everydaycheapskate.com/contact/, “Ask Mary”. This column will answer questions of general interest, but letters cannot be answered individually. Mary Hunt is the founder of EverydayCheapskate.com, a frugal living blog, and the author of the book “Debt-Proof Living”.
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