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EPISODE 10 ~ SAVE MORE: When To Refinance: Learn the Refinancing Rule of Thumb That Can Save You Six Figures

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Refinancing to get a lower interest rate is one of the rare times that you
can save 5 or even 6 figures! But people always ask me how to know if the time is right. Should they refinance now? Or wait? Or… refinance all over again?

That’s why I created something that I call the “Refinancing Rule of 5’s.” It helps answer this question simply and finally. Here it is: You should refinance IF:

1. Your new interest rate will be at least .5 percent —half a percent— lower
than your current rate.

2. You will add 5 years or less to the length of your loan. Reducing the years would be even better.

3. You will be able to recover your closing costs in 5 years or less — preferably much less. Now let me quickly repeat and explain each part of the rule.

First, Your new interest rate will be at least .5 percent lower than your current rate. People used to say you should only refinance if you could snag an interest rate that was at least 1 percentage point lower. But since rates have been hovering at such low numbers for years now, a half a percent is actually a big deal and a good minimum goal.

Second, You will add 5 years or less to the length of your loan. Reducing
the years would be even better. Often when people refinance, they focus
solely on getting a great new rate and leave everything else the same. If they originally went with a 30-year fixed rate mortgage, they do so again out of habit.

Depending how many years there are left on your loan that can defeat the entire purpose because even if you get a lower interest rate, stretching out those interest payments over additional years will eventually cost more.
Third, You will be able to recover your closing costs in 5 years or less —
preferably much less. Closing costs are the fees you have to pay to get
the new loan, like the appraisal and title fees and so on. Most of all you
should make sure you will be in this house long enough to recoup the closing
costs required to refinance. To figure this out, all you do is divide the cost of closing by your monthly savings to see how long it’s going to take for the new loan to pay for itself. Let’s say your closing costs were $1300 dollars and your monthly savings from refinancing was $132. $1300 divided by $132 is 10 months. That is far less than 5 years, so you’re good to go.

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EPISODE 9 ~ SAVE MORE: Prescription Medications: Did you know you can get prescription drugs for free?

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THE COST OF PRESCRIPTION MEDS HAS MORE THAN DOUBLED IN THE PAST DECADE AND I KNOW FROM MY WORK AS CONSUMER CORRESPONDENT FOR THE DR. OZ SHOW THAT THIS IS A REAL PAIN POINT FOR PEOPLE.

SO, HERE’S THE DEAL: EVERY YEAR, THE BIG PHARMACEUTICAL COMPANIES EACH GIVE AWAY MORE THAN $200 MILLION DOLLARS WORTH OF FREE PRESCRIPTION MEDICATIONS. YES!

IT’S TRUE. FOR SOME REASON, ALMOST NOBODY SEEMS TO KNOW ABOUT THESE OFFERS.
THEY’RE CALLED “PRESCRIPTION ASSISTANCE PROGRAMS AND THEY’RE MEANT TO HELP
PEOPLE WHO AREN’T OLD ENOUGH TO QUALIFY FOR MEDICARE AND AREN’T POOR ENOUGH TO
QUALIFY FOR MEDICAID. I’VE FOUND THAT THE INCOME THRESHOLDS, ARE REALLY QUITE GENEROUS.

FOR EXAMPLE, YOU CAN MAKE AS MUCH AS 90-THOUSAND DOLLARS A YEAR —EVEN MORE IF YOU LIVE IN AN EXPENSIVE AREA LIKE SAN FRANCISCO OR NEW YORK— AND STILL QUALIFY FOR THESE
FREEBIES. IF YOU DON’T QUALIFY FOR FREE MEDS, YOU MAY VERY WELL QUALIFY FOR DISCOUNTED
ONES.

THERE’S A CENTRAL CLEARINGHOUSE WEBSITE YOU CAN GO TO TO SEARCH FOR
PRESCRIPTION ASSISTANCE PROGRAMS THAT COVER YOUR DRUGS. AND PRE-QUALIFYING TAKES…I’M GONNA SAY…2 MINUTES. I’M NOT EVEN EXAGGERATING! YOU JUST ENTER THE MEDS YOU TAKE, YOUR AGE, ZIP CODE, NUMBER OF PEOPLE IN YOUR HOUSEHOLD AND YOUR INCOME. AND THEN UP POPS A SCREEN TELLING YOU WHICH FREE MEDS YOU QUALIFY FOR AND HOW TO COMPLETE YOUR
APPLICATION. AT THAT POINT, YOU USUALLY HAVE TO PROVIDE PROOF OF INCOME AND DETAILS LIKE
THAT.

EVERY DRUG COMPANY’S PROGRAM IS DIFFERENT BUT IT USUALLY TAKES ABOUT 10 DAYS TO
GET FINAL APPROVAL. THAT’S IT! YOU WILL EITHER PICK UP YOUR FREE PRESCRIPTION DRUGS AT A LOCAL PHARMACY OR YOUR DOCTOR’S OFFICE.
I HAVE LINKED YOU TO ALL OF THE RESOURCES YOU NEED TO SEE IF YOU OR SOMEONE YOU
KNOW CAN GET FREE PRESCRIPTION MEDICATIONS:

•Needy Meds: This nonprofit was started by a nurse and doctor to help
people find these programs: www.needymeds.org

•Partnership for Prescription Assistance: Run by PhRMA, the largest
drug industry trade group: www.pparx.org

•RX Assist: Founded by Volunteers in Health Care, which is affiliated with
Brown University: www.rxassist.org

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EPISODE 8~ SAVE MORE: Never Pay For Gas or Groceries or Vacations Again Thanks to Mystery Shopping

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I’VE BEEN DELIBERATELY AVOIDING ASKING PAM ABOUT THE REIMBURSEMENTS, BECAUSE THAT IS THE SAVINGS”ASPECT OF MYSTERY SHOPPING. SO LET’S TRANSITION NOW INTO OUR SAVE MORE SEGMENT OF THE SHOW.

SO, PAM, EXPLAIN TO PEOPLE WHY YOU ARE EVEN MORE EXCITED ABOUT THE REIMBURSEMENTS YOU GET THAN THE MONEY YOU MAKE.
My reimbursements for the year are about double my payments. And reimbursements aren’t taxable income, which makes them even more valuable than my actual payments. This is the point that needs to be brought out. It’s not about how much money you make but what you keep. I haven’t spent my own money on groceries since 2000. I do 4 to 8 grocery mystery shopping trips a week. I get a $12 reimbursement per location. The biggest thing is learning to buy smaller portions. If we want rib eye I will buy one at this store, one at the other. It takes some time to figure out how to do it.

WHAT ARE SOME OTHER EXAMPLES OF HOW YOU HAVE SAVED MONEY THROUGH REIMBURSEMENTS?
Often it is stuff I would have to spend money on anyway. Oil changes, car washes, clothes. When we go to Ruth’s Chris Steakhouse that is a $160 or $180 reimbursement. We wanted to go to San Francisco. I found a hotel mystery job. They reimbursed me $440 for the nightly fee and paid me $50 on top of it to write the report. WHAT DOES YOUR FAMILY THINK OF YOUR MYSTERY SHOPPING CAREER? A while back my husband said can we just go somewhere and not mystery shop?

It took him a while to understand that the reimbursements really add up!

But now he gets it. My family gets to do things we could not normally afford to do. My daughter had the luxury of a mom who was always home. WELL, AT THIS POINT, YOU’VE GOT PEOPLE’S ATTENTION AND MANY ARE GOING TO WANT TO TRY MYSTERY SHOPPING THEMSELVES. WHAT ARE SOME RESOURCES FOR PEOPLE TO GET STARTED?

We operate several Facebook groups where we share information with each other. These are closed groups, but people can request access and I will grant it.

Connecting mystery shoppers, schedulers, editors and mystery shopping company owners:
www.facebook.com/groups/IMSCshoppers/

IMSC Job postings for mystery shopping:
www.facebook.com/groups/IMSCjobposts/

Website main page:
www.imscinfo.com/

Becoming a mystery shopper:
www.imscinfo.com/register-for-companies

Online training and resources:
www.imscinfo.com/education-resources

MEANWHILE, YOU ALSO PUT ON MYSTERY SHOPPING CONFERENCES. ARE NEWBIES WELCOME AT THOSE?
In 2009 the MSPA, which used to do shopper conferences, decided it wasn’t beneficial to have shoppers there so they canceled their conferences. So mystery shoppers decided to do their own conference. I held my first conference six months later in Las Vegas. Ended up at Greek Isles. Off the strip but we had over 135 shoppers and over 60 companies. This told me there was a need for this. I continued on. I’ve had at least one conference every year. Sometimes two or three. Now we get 150 – 300 people at each conference.

AND, DON’T BE SHY, TELL US ABOUT YOUR “HOW TO” BOOK ON MYSTERY SHOPPING
I wrote a book on it. The Essential Guide to Mystery Shopping. When things would happen. It took me years. I started writing down everything that happened and going back in and putting down notes on how to fix it. Everywhere I went people said “how do I do that?” I got so tired of telling people, I was like, let’s put this in a book.

AND YOU’VE GOT ONE VERY SPECIFIC WORD FROM THE WISE ABOUT HOW TO ACCEPT PAYMENT FOR YOUR MYSTERY SHOPPING WORK.
Some companies pay every week or two but other companies pay 30, 60 or 90 days out. You don’t want to go broke doing $200 dinners and not getting paid back for a long time. So insist on being paid more frequently.
*Elisabeth’s note: Be sure to read the Episode 8 “Make More” blog for details of how much money mystery shoppers make and how to get into the business.

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EPISODE 7~ SAVE MORE: How To Save As Much as 20% On a New Vehicle By Buying A “Dark Horse Car”

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WE’RE STARTING WITH OUR “SAVE MORE” SEGMENT BECAUSE IT IS A JUICY

ONE: HOW TO SAVE BIG BUCKS ON A VEHICLE BY BUYING A “DARK HORSE CAR.” HERE TO EXPLAIN WHAT THAT IS AND HOW MUCH YOU CAN SAVE BY BUYING ONE IS RONALD MONTOYA, EDMUNDS DOT COM SENIOR CONSUMER ADVICE EDITOR. WELCOME, RON!

I THINK PEOPLE KNOW THE EXPRESSION “DARK HORSE” REFERS TO A HORSE THAT’S NOT VERY WELL KNOWN AND COMES OUT OF OBSCURITY TO WIN THE RACE. BUT A FEW YEARS AGO EDMUNDS COINED THE TERM “DARK HORSE CAR.” RON, WHAT IS A DARK HORSE CAR?

Dark horse cars are vehicles that are equivalent to the most popular models but are less well known, less popular. When we first coined this term the classic example we used was the Nissan Altima, which is a dark horse equivalent to the more well known Toyota Camry. They’re really similar in quality and features, but the Altima is significantly less expensive.

WE’LL TELL PEOPLE JUST HOW MUCH LESS EXPENSIVE IN A MINUTE, BUT FIRST, DO DARK HORSE VEHICLES EXIST IN EVERY CATEGORY? They sure do. From compact cars to luxury cars, SUVs to pick up trucks, Edmunds has always been able to identify dark horse vehicles that can save you money. OK, SO LET’S GO THROUGH THEM, CATEGORY BY CATEGORY. YOU GIVE ME THE POPULAR CHOICE AND THE DARK HORSE CAR IN EACH. AND LET’S GO FROM THE CATEGORY WITH THE LEAST SAVINGS TO BE HAD AND BUILD TO THE ONE WHERE YOU CAN SAVE THE MOST MONEY BY BUYING A DARK

HORSE CAR.
Midsize Three-Row SUV
Mainstream: 2017 Toyota Highlander $31,590 (TMV $29,959)
Dark Horse: 2017 Hyundai Santa Fe $31,695 ($27,974 w/$2,000 incentive) ***$1,985 difference 7%

Luxury- Midsize Sedan
Mainstream: 2017 Mercedes-Benz E-Class $53,075 (TMV: $46,812)
Dark Horse: 2017 Volvo S90 $47,945 (TMV: $40,927)
*****$5,885 difference 13%

Compact Sedan
Mainstream: 2017 Honda Civic $20,415 (TMV: $18,857)
Dark Horse: 2017 Kia Forte $19,395 (TMV: $16,483 w/$2,500 incentive)  *** $2,374 difference 13%

Midsize Sedan
Mainstream: 2017 Honda Accord $24,030 (TMV $21,019) Dark horse:  2017 Hyundai Sonata $22,435 (TMV: $17,773 w/$3,350 incentive)  ***$3,246 difference 15%

Minivan
Mainstream: 2018 Honda Odyssey $30,930 (TMV, is sticker)
Redesign year
Dark Horse: 2017 Kia Sedona $27,850 (TMV: $26,422 w/$1,000 incentive) *** $4,508 difference 15%

Compact SUV
Mainstream: 2017 Honda CR-V $24,985 (TMV: $23,881)
Redesign year
Dark horse: 2017 Ford Escape: $24,645 (TMV: $19,707 w/$3,900 incentive)  *** $4,174 difference 17%

Luxury- Compact SUV
Mainstream: 2017 BMW X3 $41,045 (TMV: $37,764)
Dark Horse: 2017 Acura RDX $36,645 (TMV: $30,271) ****$7,493
difference 20%

Important Pricing disclaimers. Base models with no options were chosen for the starting MSRP. The savings were estimated from the average price paid in the Santa Monica, CA zip code. People's numbers will vary based on their negotiated price. On vehicles that have an incentive, the numbers are based on offers for the month of June 2017. Many of them will expire on July 5 2017. That being said, on any given day, you're likely to pay more for the mainstream vehicle, so the same concept applies.  If they are leasing, the numbers will be different and the incentives are likely to change as well. The savings numbers aren't meant to be taken as gospel. They are meant to showcase other vehicles that due to heavy incentives or the lower starting price, can be a better purchase for price conscious shoppers. THE SAVINGS ARE IMPRESSIVE, BUT I HAVE TO ASK: ARE DARK HORSE CARS AS GOOD QUALITY AS THE MORE POPULAR CARS WE’RE COMPARING THEM TO?

We’ve chosen these dark horse models carefully with quality in mind. Not just ANY alternative make/model makes a worthy dark horse. But it’s easier to find good dark horse picks these days because ALL cars have gone up in quality in recent years. On the flip side, some of the savings we see is because of the power of supply and demand and the fact that the most popular makes/models are marked up because they’re in demand.

TO SEE GREAT USED DARK HORSE CARS, CHECK OUT THE EPISODE 7 GUEST BLOG POST!

GUEST: Ronald Montoya, Senior Consumer Advice Editor

GUEST BIO:
Ron Montoya is a senior consumer advice editor for Edmunds where he helps shoppers navigate the car-buying process. He has plenty of first-hand knowledge of how to do that, since he buys and sells the cars in the Edmunds long-term test fleet.

Ron joined Edmunds in 2008, where he has held a number of different roles and written more than 100 articles as part of the Consumer Advice team. Prior to Edmunds, he worked at two Honda dealerships, which is where he first started developing his extensive knowledge of the car shopping process.

Ron received a bachelor’s degree in journalism from California State University

Northridge.
Currently driving:

2017 Mazda 3
First car / favorite memory: My first car was a 1984 Toyota Corolla. My favorite car memory was driving up the California coast to the Concours D'Elegance, in Pebble Beach, in a 1989 Yugo.

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