Edit: 3/26/2007 – still no internet at home – will play electrician tonight and have something for tomorrow on my thoughts on helping our kids out on their college education.

A couple things I learned from this experience.

• Plug Expensive things like televisions into surge protectors. Probably something not a lot of people think about, but probably a smart thing to do. Not sure if things like refrigerators and freezers have built in surge protection, but it might not be a bad idea to make sure all your big ticket items are protected.
• Lightening is pretty powerful stuff and is pretty unpredictable. The lightening strike tripped about half of our breakers in our house as well as most of the breakers in the neighbor’s houses.
• Just because something is plugged into a surge protector does not mean it is safe. My wireless router was plugged into a surge protector and was still fried. Funny part is the other 4 items in the surge protector survived the strike. Router must have been more sensitive to the surge.
• Home owners insurance is better for large scale disasters. In this case I have a $500 deductible and will be hard pressed to get much over that value. I’d have been much better off if about 10 other things in my house had fried, then I could have shopped around when replacing them and helped recoup some of the cost of my deductible
• I am an internet addict. Not having internet for the last two days has been incredibly tough for me. I’m swear I’m starting to get the shakes by not being able to keep up with my RSS feeds and blogging. At the same time its a little liberating be unplugged for a day or two (unplugged meaning I’m only on the computer for 8 hours a day at work)
• I’m really a moron without the internet. I sort of pride myself in being able to be very knowledgeable on just about any subject at hand. Reason for this is before I do anything I spend a couple hours on the internet researching it. Example I want to find the best way to fix the wiring in my house and best way to propose my claim to the insurance company, but without the internet I’m clueless and it will probably end up costing me more money that it should have.
• Emergency funds make incidents like this a lot more bearable. Granted you don’t necessarily have to replace everything that is lost in a situation like this (maybe a good time to decide the value of the item and whether you really need it), but having that peace of mind that you don’t have to take on more debt to recover from unexpected situations like this make it all that much more bearable. Our emergency fund is pretty light right now, but fortunately we should be able to handle this situation. Now when both of our cars break down next week, it might be a different story.

Anyway hopefully I get something figured out this weekend and will be back in the swing of things next week. If I have to I’ll run a phone cord from the outside jack through a window and into my office if I have to. I’ve never made a claim on my homeowners insurance before so I’ll probably learn a thing or two in the process and if I learn anything interesting I’ll report back.

Mulch
Mulch is an important part of most frugal landscaping plans.  Mulch is not only a cheaper alternative to things such as gravel or stones, it is a lot less likely to cause you issues if it creeps out of your landscaping and into your lawn which it most likely will do.  Think 2 inch rock in lawn mower versus piece of tree bark.  Mulch is also much better for your plants and flowers as it is a natural material which will help retain moisture (less watering) and slowly break down and release nutrients for your plants and shrubs.

Also if you want a certain color or aesthetic look to your landscaping plan, mulch comes in just about every imaginable color these days.  Beware though that this mulch is usually lower quality wood and is artificially dyed.  Usually after a summer or two the dye fades quite a bit and it is necessary to keep putting a new layer on top to keep the bold color.  For that reason alone I suggest going with a natural wood mulch. 

Almost every landscaping, home improvement store, and nursery carries mulch.  Heck I’ve seen a lot of gas stations that carry mulch too.  Obviously when it comes to mulch you are much better off purchasing it in bulk (by the cubic yard) that you are buying it in the individual bags as the price will be a fraction of the cost.  If you have access to a truck, picking up your own mulch can save you quite a bit of money versus having to have it delivered, especially if you live quite aways away from the source.  If you don’t have access to a truck you may want to consider talking with your neighbors and see if they would be interested in going in on some mulch together to save on delivery costs (I have seen this done in my neighborhood).

Before you run out to the local landscaping center it may be frugal to call some of the local tree trimming companies and see what they do with their wood chips.  Some of these companies pay to dispose of the wood chips so they may be happy to drop them off in your yard for free.  Also some local city and county recycling/compost sites offer free mulch for residents so there is a good chance that you may be able to get some or all of your mulch for free.

   

Plants/Bushes/Shrubs
If you plan on mixing plants into your landscaping plan there are a couple ways you can save money on the costs.  As with the mulch you should see what you can get for free before you actually pay for anything.  Often bushes/shrubs/flowers can be gotten from friend/family/neighbors/etc.  Many bushes such as the Hosta can be split, moved, and both the original and the new bush take grow like nothing happened.  The same can be done with many varieties of flowers, and even shrubs.

 

After you’ve exhausted all of your free options, probably the next best thing is to start your plants from seeds.  This can save you tons of money in the process as seeds can be gotten for a couple cents per plant in most cases.  It just takes a little planning ahead and patience, but you can get all the beautiful plants that you want for a fraction of the cost.  Not to mention it’s really easy and fun.  You can purchase seeds online and at most retail stores.  Some sites that I ran across are (valueseeds.com, and dianeseeds.com) If you look around online at various garden forums or maybe even local garden clubs you can probably get seeds for free as from what I’ve seen gardeners like to help other gardeners out.

You can start seeds in your house in late winter/early spring and can help you get over the winter blues if you live in a northern state, kind of gives you the hope of spring being right around the corner.  Just Google “starting seeds indoors” and you will get all you need to know about starting seeds. Like I said it’s cheap, easy, and fun.  Seeds can be started in just about any small container and all they need is warm temperatures and access to sunshine or halogen lights once they sprout.  Often setting them next to a window sill will be ample sun light, but some people who really go to town set up halogen shop lights over their plants in their basement to make sure they get all the light they will need. Check out this person who is truly frugal and didn’t even need to buy potting plants, she just reused old toilet role cores. Got to love how frugal gardeners can be!!

Bare root ordering
If you do order a tree/bush/plant online or even your local landscaping company you may want to ask to see if they offer bare root tree/shrubs/plants.  Bare root is basically a plant that is not planted in soil which renders the plant dormant.  The beauty of bare root is that is saves a ton in shipping costs and from my research these plants have just about as good of chance of surviving as a potted plant.  The good news for you the consumer is the price is often cut in half if you go bear root.  When we had Mr. expensive landscaping company come over and quote out our landscaping they offered bare root and it was about exactly half the price due to the ease of delivery and less potting supplies they had to supply.  They stood behind these plants and they had the same warranty and same success guarantee as the plant trees/shrubs.  They also said that they would grow and flower just as well as the plotted variety.  So be sure to ask about bare root options whenever purchasing landscaping plants, especially if you have to pay shipping costs ordering online.

Well this is probably getting a little long so I’ll continue the rest on in Part III

Landscaping isn’t all that bad as according to Free Money Finance it can increase a homes value 7-14% (which for my home would be $11,000 – $22,000) – although I personally have some reservations about those estimates so I’m not going to go ahead and blow $15,000 on landscaping with the thought that I’ll easily get this money back when I sell my house. Personally I’m just hoping it will make my lawn easier to mow as I won’t have to go around downspouts or try to mow right up to the edge of my house. Also I think I would enjoy growing some of the plants also.

My landscaping idea
I personally would like to incorporate as much edible landscape in our plan as possible. I always like it when things can serve more than one purpose and honestly many of the fruit bearing and edible plants can be just as pretty as the standard landcsaping plants. Nothing wrong with being able to save on some grocery costs in the process and from what I know people generally get a lot of enjoyment on growing their own food, so to me adding a bunch of edible landscaping to the mix would be a great idea. My wife has some concerns though and obviously for her landscaping is all about beauty so I have to go ahead and convince her that blueberry bushes are beautiful too.

Blueberry bush in fall

Blueberry blossoms in spring

Ways to keep costs down
Obviously doing it yourself can save you money if you know what you are doing. To be honest landscaping doesn’t appear to be so difficult as that the average Joe can’t do a pretty descent job if they do their homework, which I plan to do. According to the article referenced by Free Money Finance purchasing big ticket items in the fall will get you the best prices. Also explained was breaking up your project into a multi-year project, which wsa something I had already planned on doing. This gives you a chance to learn from your mistakes rather than making a mistake on your entire landscaping project. Obviously shopping around on the internet can allow you to save money on plants, but be very careful with this method as your plants have a lot less likelier chance of surviving if they were grown in a climate that differs greatly from yours. For example I live in Wisconsin I probably don’t want to be buying too many plants from a nursery in Georgia. Find your hardiness zone to determine what plants/trees will survive in your climate

Another thing to consider when determining the cost of landscaping is maintenance. If you plant a lot annuals you will be paying replacement costs every single year to keep up your landscaping looking good. If however you plant perenials and treat them right you should be able to get many years of enjoyment out of them without having to head off to the garden center each spring. Another thing to consider is to buy as many drought resistant plants as possible. This means you will have to spend a lot less time making sure your plants are watered and a lot less money on your water bill. Planting plants and trees that are appropriate for your region and don’t require a substantial amount of water to keep looking good means less maintenance, lower costs, and more enjoyment for you out of your landscaping. Also making appropriate use of mulch can help keep the moisture in by your plants and reduce the amount of weeding you have to do.

Well honestly at this point I don’t have enough personal knowledge about landscaping to add more than just the basic things I’ve talked about so far (thus the dreaded – Part I tag). I will be researching this topic pretty hardcore the next couple weeks so look for more articles from me as I try to find a low-cost, low-maintenance, home-value improving, multi-functional landscaping plan for my house.

See part II here

Seeing as how they already have a number of debts to worry about and little to no money saved up for a down payment there is no reason to go ahead and pile another huge chunk of debt onto their plate. Not only would having to pay for a mortgage decrease the resources they would have to pay down their existing debt, it likely would give them a host of reasons to spend even more money and run up even more debt for things they really do not need because of the house they just purchased.

When people often compare renting versus buying a house they often seem to leave so many things out of the puzzle.

When you rent you are just throwing money away
You often hear this as the number one argument to buy a home. When you rent all of your money is going to your landlord and you will never see a penny of that money back. Thus you would be much better off owning your own home and yes you have to make big monthly mortgage payments, but you eventually own your house so you really get that money back.

Problems with this reasoning

• The bank doesn’t give you the money for free. They charge something called interest, which tends to add up, especially on big expensive things like houses. I paid more in just interest last year than I did in rent and utilities combined in an entire year at our last apartment.
• Property taxes – Property taxes a lone are usually about a half years rent at an apartment.
• Maintenace – Guess what? When something breaks you have to fix it now. Not only that you have to mow the lawn, shovel the snow, pay for garbage pickup, and kill varmints. This means you now need things like lawnmowers, ladders, power tools, hoses, varmint traps, etc.
• Insurance – while it’s not going to break the bank, homeowners insurance is often 3-5 times (in my experience) more expensive than renter’s insurance. This is just more money coming out of your pocket when you decide to purchase a house.
• Utilities – Often when you live in an apartment you get certain utilities for free or in many cases they cost a lot less in an apartment than they do when you own a house.
• Landscaping, interior decorating, painting, remodeling, finishing off the basement, cementing/blacktopping the driveway, building a deck, staining the deck, repairing the roof, fixing/replacing the furnace or water heater or garbage disposal, etc., etc. You likely won’t have too many of these expenses while renting, but I’ll put money on it you will have most of them if you own a home for any extended period of time. Again more money out of your pocket and into someone else’s.

Just in interest, property taxes, and added insurance costs alone in one year of owning my home I could have lived in my previous apartment for nearly two years. I could have invested all this extra money, used it to pay down debt, or saved it for a major purchase (such as a down payment on a house)

Ok you bought a house, you’ve been “paying yourself”, and now you need to move
If you need to move you can’t just pickup and leave like you can with an apartment. Us young folks don’t tend to have our lives/career paths entirely figured out at this point in our lives, so it’s probably pretty likely that if you buy a house right away you will probably be selling it in the next couple years as you decide to move to take a new job or need a bigger house because your new wife is expecting triplets or whatever the reason. Just from my experience people in their twenties in general don’t tend to stay in the same residence for extended periods of time. So now you have to sell your house which in certain markets may take several months to a year depending upon how the local real estate market is doing. Yep it’s a market just like any other market and in the short run your house price can go down. So now not only do you need to move, the only way you can sell your house is to sell it for less than you paid for it. Guess what the bank doesn’t care what you sell it for and you are still on the hook for the full amount of your mortgage. What’s that you didn’t have enough money for a down payment and the bank let you finance 100% of your house? So now on your $200k home you’ve got a $198k mortgage (you’ve been paying yourself for a good year and a half now ) and you were just forced to sell it for $185k? Ouch. Oops I forgot to mention that selling your house isn’t free either. In fact it’s pretty damn expensive. The real estate agent gets their chunk (4-6%), legal fees, title transfer fees, other miscellaneous taxes, any repairs that need to be done before the sale is final, etc. Costs of selling your house are often close to 10% of its value. Got a $200,000 house that is another $20,000 that you will never see. Then even after all of those fees you do manage to make a profit, if you happen to sell it after living in it for less than 2 years you have to pay taxes on any gains (official rule is you have to live in it 2 of 5 years before you sell it) also.

If you really break it down the crux of the problem is people need a place to live. In my opinion the cheapest solution to this problem is often to rent, especially if you are disciplined enough to take advantage of the cost savings of renting and put extra money away. It gives you a chance to sit back and decide what you really want in life, where you want to live, and in what kind of house you want to live in. Rushing into home ownership just because other people tell you it’s a smart thing to do probably isn’t the smartest move and could end up costing you a boatload of money and headache in the process. So for me, from a purely financial aspect, renting is a no-brainer.

Ok you got me, this article is entirely one sided and takes a look at many of the negatives of home ownership and all the worst case scenarios. It’s no better than any of those articles or people that say the smartest thing you can do is purchase a home, real estate never goes down. I’ll admit this article isn’t very balanced, but when you are having an argument with your wife you don’t want to be balanced you just want to win

Actually she thought many of the same thoughts, I just think that in many cases so many important things are left out of the buy vs. rent decision that it’s often just as one sided on the buy side. It’s not a clear cut decision financially/emotionally/or however else you look at it. There are pros and cons and every person’s situation will be different and yield a different answer. Just make sure you got all your facts in front of you before you make your decision, because it certainly not as easy as most people make it sound.