3 Year-End Money-Saving Tax Tips

If you've got some money and you're in the business of saving as much of it as you can legally,* here are a couple of ideas on how to do so.

1)  Max out your traditional IRA - If you are under 50 years old, you are eligible to put as much as $5,000 into a traditional IRA account.  The nice thing about a traditional IRA is that you are investing money in the account post-tax, but the government sees it as a pre-tax investment.  Thus, when you file your taxes, you will receive money back for the amount that you invested in your traditional IRA that you've already paid taxes on.  Bear in mind that the above $5,000 limit is the limit for any and all IRA accounts you may have (that is, if you have both a Roth IRA and a traditional IRA, the total you can invest in both combined for 2011 is $5,000 - e.g., $2,500 in the Roth, $2,500 in the traditional).

2)  Harvest losses - The market is picking back up, but if you have stock or mutual fund investments in a non-tax-advantaged acccount (i.e., not a retirement account), you can sell off some of your investments at a lower price than you bought them for in order to offset taxes that you will pay for profits from other investments.  While you will definitely lose money on your investment, you will pay less in taxes.  Five Cent Nickel does an excellent job of explaining this concept here.

3)  Donate to a charity or non-profit - Now wait a minute, you say.  I'm reading this because I want to keep my money, not give it to the poor!  That's a fair enough attitude, Ebenezer, but it is worth noting that money donated to charities and/or non-profit organization (such as THEATRES) is money that you can deduct from your taxable income and therefore pay less money in taxes on.

*If you're more interested in saving money illegally, I recommend not hiring the man in this video.

Photo by soukup.

This post was featured in the Carnival of Personal Finance #340.

AT&T Can Suck It! (And Also, Thanks AT&T for Being Reasonable)

When in Rome, make sure not to get charged for roaming.
(Wordplay!  Zing!)

A few weeks ago, I encouraged you to double-check your invoices, particularly while travelling via cruise.  My reasoning behind this advice was that Norwegian Cruise Lines double-charged me, my wife, and my brother for an excursion that we took.  However, it turns out that there were even more accounting irregularities due to our vacation.

When I was up at my family's house for Thanksgiving, my grandma complained about how high their cell phone bill with AT&T was the previous month.  Being the personal finance blogger extraordinaire that I am, I asked to take a look at their bill.  The culprit, it turns out, was my brother.  He had single-handedly made their bill go up by nearly $90.

Now, right away, I know what you're thinking, and no, my brother did NOT download Aqua's Barbie Girl 90 times through iTunes.

How did he make their bill go up so much you ask?  Well, he made and received some phone calls while he was on the east coast prior to our cruise.  And he was charged 79 cents a minute in roaming charges for the privilege of being a part of those phone calls.

Let that sink in for a moment.  Somebody, in 2011, was charged for roaming.  ROAMING!  That's like building a fire in your fire place, and then receiving a bill in the mail a few weeks later for using smoke signals.

To AT&T's credit, it was actually pretty easy to get this cleared up.  I called them up, expressed my incredulity that anybody could get charged for roaming (it's not even a thing anymore!), and they credited my grandparents' invoice the amount that had been charged.  It turned out that my grandparents had just kept renewing a very old cell phone plan (that I think they originally signed up for in 1999) under which roaming charges still applied.  With their permission (and at the firm suggestion of the AT&T customer service representative, who claimed that he would only issue a credit for roaming charges one time), I updated their service plan online to a newer, comparable plan.

But the kicker is that neither my grandparents or my brother were going to call AT&T about it!  If I hadn't been there, they would have just paid the extra cash and gone on their merry way.  Somewhat fortunately, neither my grandparents or my brother are really pressed for cash, but I can't help wondering how many people see extra charges on their bills, figure that those charges are fair, and pay them.

How much money do big companies receive just because people don't call them on it?

How about you?  Do any of you still get charged for roaming?  Do you realize that we are no longer in the year 1999?  Let me know in the comments.

Photo by tejvanphotos.

Friday Links

Are you interested in irritating your customers?  Make your product look a lot like one of your other products.

One of my pipe dreams is to own a book store.  I say this a pipe dream because I don't think people can make much of a living selling books.  With this in mind, Bookshop Blog asks, "What Compels Someone to Own a Bookstore?"

Chase decides not to evict a soon-to-be 104 year old woman, mostly because the people it hired to do so refused.

Andrea at So Over Debt wrote about different reactions to crises.  If you're interested in personality types, this makes for some interesting reading.

Meadow DeVor wrote about how she paid off just under six hundred grand in less than three years.  It's a pretty amazing story.

Five Ways the 2011 San Diego Chargers Are Like Debt



These guys are true fans.

I received some positive feedback on my post a few months back about how this year's Colts compare to finances.  As I basically write on this site for love and affection, I thought I'd take another shot at that style of article.  Please feel free to love and affect me in the comments.

Let me start by saying that my favorite football team is the San Diego Chargers, and so it is with fear and trepidation that I liken my team to the pernicious "d" word of the personal finance community.  That "d" word, of course, is debt.

But how, you ask, can a real, actual team be compared to an abstract idea?  Gather around, my children, and I'll tell you a tale.

1)  Both may be fun, for a while - The Chargers started this season with a record of 4-1.  "Four wins and only one loss?", we fans asserted incredulously.  "Can life get better?  I submit that it cannot!"  Following several seasons of 2-3 starts, we finally had a team that gained momentum early, and it was difficult not to be optimistic.  That was a good time to be Chargers fan. 

In a similar way, when a person is getting into debt (especially credit card debt), it's probably a pretty good time.  "What's that?  I can buy the 70" television AND the Playstation 3 right now and only worry about paying it off in the future?  Sign me the crap up!"  Let's be real: it feels amazing to be able to gratify yourself instantly.*  It's only when the bills start to come that our purchases feel a little less like smart choices.

A Thanksgiving Update and a Financial Bucket List



Turkey knows your thoughts
and judges you.
Be afraid.



Happy Thanksgiving tomorrow to all my readers in the lower 48 (I'm pretty sure there aren't any turkeys in Alaska and Hawaii, so how can they celebrate the day? :-) ).

Today, I am thankful that, after a month, Norwegian Cruise Line has finally refunded my money from when they double-charged me for an excursion I took on my cruise that ended over a month ago.  FINALLY!  That's $178 that I have again.  Take that, suckas!

Secondly, I am trying to win the $500 Give Me Back My Five Bucks Competition, sponsored by Life Insurance Finder, the life insurance experts.  To get some extra entries, I need to list some items on my financial bucket list.  Here goes nothing!

1)  Get my money back from Norwegian Cruise Lines.  Check, check, and double-check.  I know that this was a very small goal, but it was super annoying to try to connect with the right department at NCL and I've also been checking my bank statement nearly every day to make sure that the money got credited back. I am glad to put this behind me!

2)  Max out my Roth IRA contribution every year until I can't anymore.  My wife and I are close to bumping up against the maximum income level a married couple can have and still be eligible to contribute to a Roth, so I need to contribute now while I am still able.

3)  Take full advantage of my very generous company 401(k) match.  My company matches 100% of my contributions, up to the specified limit of $16,500.  I am ineligible to contribute until January, however; they want the employee to work at the company for six months before starting to match.  Come January, look out!

4)  Save more money for traveling.  I really want to climb Mt. Kilimanjaro with my dad and two brothers.  My dad's getting older (aren't we all?), so I want to be able to go while he's still able.

5)  Produce and direct a play.  I haven't done this yet, but I'd like to mount a small-scale production with paid actors while shelling out approximately $5,000.  I just need to do it!

What items are on your financial bucket list?  Let me know in the comments, or, better yet, leave a comment over at Give Me Back My Five Bucks and enter the contest yourself!  (You'll just have to give me a kickback if you win. :) )

Photo by techvt

The Arts Can Help the Economy?

In a recent article at the Denver Post, it was revealed that nonprofit theatres (read: not commercial for profit theatres on Broadway) contributed 1.9 billion dollars to the national economy in 2010.

The article states:

"The $1.9 billion impact estimate, based on surveys of 171 member companies and analysis of tax records filed by 1,636 more, accounts only for salaries, benefits and payments for goods and services. The actual impact is much greater, the theater group says, when you take into account dining, parking, babysitters, hotels and more. "

The study also asserts that, generally speaking, communities in which theatres pop up are communities that are then revitalized by the presence of that theatre, which further encourages the growth of local economies.  One researcher is calling this the "arts ripple effect."

So, not only is the theatre good in qualitative ways (enrichment of mind and soul), but it's also good for America (and Canada [and...the world!]) in down and dirty monetarily quantifiable ways.  Good to know.

How I'm Saving Money the Next Few Days on Travel

This is me after plowing through a snow
bank last Christmas while being pulled
behind my father-in-law's tractor. 
This is, literally, how I roll.

Based on the number of posts that I write about it, you would think that I travel a lot.  While I suppose this is true, I certainly don't feel like I travel that much (of course, I spent most of the last two years making weekly flights to and from grad school, so perhaps I don't have a good base reading on just what constitutes "a lot" of travelling).

Nevertheless, over the next few days, the wife and I are taking another trip.  For this one, we'll be leaving our beloved San Diego sunshine to face the icy, frozen northern tundra that is Fargo, North Dakota.*  My wife's family lives in North Dakota, and we're making a trip out there to visit and see our new nephew. 

Here are a handful of ways that we're fortunate to be able to save money over this time.

1)  Staying with Family - While this is not as exciting as getting a hotel, it's also much less expensive.  We are flying out of LAX tomorrow morning, and, fortunately, my brother lives pretty close to LAX, and he's offered to let us stay at his place AND take us to the airport in the wee small hours of the morning.  Additionally, we are able to stay at the home of the relatives that we're visiting in North Dakota, so we'll save there too.  This leads right into...

2)  Saving on a Car Rental - Because we are able to stay with family, we will not need to rent a car to get from our hotel to our family.  This is awesome, because, as much as I like fish-tailing all over the road, I'm not the hugest fan of driving on snowy roads.  You might argue that this makes me a sissy, and I agree with your assessment.

3)  Saving on Flights - One of the primary reasons we chose this weekend to fly north for the winter (birds got it all wrong, man!) is that the price for our flights was so low.  While the airline that we're flying has stiffed us before (at least they pass on the savings incurred from treating customers badly!), we're flying Allegiant Air again.  Our tickets were approximately $250 round trip, per person.  This is almost unheard of for flying from California to North Dakota, as flights can easily be that much just one way.  However, apparently the weekend before Thanksgiving is not prime travel time, so we were able to take advantage of the cheaper tickets offered through the website.

How do you save on travel?  Let me know in the comments.

*Here's hoping nobody puts me through a wood chipper.