There are just some things that Gen Y won’t pay for: news, music, banking fees, etc. Apparently, this social media savvy cohort doesn’t find a tremendous amount of value in these items or they can simply get them for free somewhere else.

This trend seems have spilled over — perhaps temporarily — to the auto industry.

In a recent study, potential Gen Y car buyers were 2.3 times more likely to buy a used car vs. a new car. (Minute 2:20 in video.)

But once I began to think about this, the only people that I know that buy gently used or secondhand stuff on a regular basis are the Gen Y crowd and late Gen X crowd (like me).

Think about this for a second…

• Who’s more likely to buy a used laptop on eBay (and maybe get a discount from Microsoft/Bing.com)?  The less than 40 crowd.
• Who’s more likely to be a vulture investor and buy a gently used car at half price from the Craigslist marketplace?  The less than 40 crowd.
• Who’s more willing to bypass Realtors entirely and do a housing swap without any money changing hands? The less than 40 crowd willing to do hours of research.

So it’s not surprising that the younger, more tech savvy consumers are the ones more willing to do more research online and use the Internet’s disintermediation effect to full capacity to find the best bargains. Plus, now that so many different communities (like eBay or Craigslist) are arguably the world’s largest garage sale, it’s not surprising that savvy consumers are no longer willing to pay retail price for every little thing.

This was an original post from Steadfast Finances. For more, follow me on Twitter.

Gen Y Developing a Preference for ‘Used’ Stuff?

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To get a change of pace from my normal push ups, sit ups and treadmill routine, I thought it would be a nice change of pace to go back to free weights 2 to 3 times a week or use a few high tech cardio machines (elliptical machines, rowing machines, etc.). So I popped into my local gym to get a quick price quote.

Once I saw the prices, my frugal living complex quickly kicked in and convinced me to keep doing push ups in the garage. Gym membership fees were on a “limited time only price” of $34 per month for full gym access. Of course, the perks cost extra: personal trainers, yoga classes, locker room access, etc., were only available via a la carte pricing and were not included in the monthly gym membership fee.

Being something of a YouTube junkie, I had already convinced myself I could find dozens of creative workout routines for free before I even hit the parking lot. So instead of adding another monthly expense to the budget, I decided to save the extra $34 per month ($408 per year) expense and look for free workout routines on YouTube.

If you have run into the same dilemma and you’re looking for a few easy workouts you can do at home in your spare time, here are a few excellent workouts and strength training routines for beginning and advanced levels that I found within minutes of doing a simple search. You’ll also notice that none of these workouts requires any type of equipment or fancy gadgets… just you, your time and some sweat equity!

Basic Cardio and Metabolism Boosting Workout

The burpee (also called squat thrusts) is one of the most basic, yet most efficient, total body exercises you can do. It may look like an exercise to build upper body strength, but don’t let the push up motion fool you because you’re legs will probably start give out long before your arms do.

It’s an excellent way to quickly get your heart rate up, boost your metabolism and get a total body workout with minimal time invested. Start with 10 to 20 repetitions for each set and increase the number of reps as your endurance allows.

This is only one individual exercise, but many more combinations can be found at GymJunkies.com.

Advanced Cardio and Metabolism Boosting Workout

If you’re looking for something a little more diversified or maybe targets a few more muscle groups, here are a few combinations of simple exercises (no need for equipment) designed to raise your heart rate and increase your stamina.

You can go as “advanced” on this sort of workout as you want by simply adding in new exercises, raising the number of sets you do, or by simply increasing the length of time you do each exercise (90 second intervals versus 30 second intervals are far more difficult than it sounds).

Basic Strength and Toning Exercises

If you’re new to working out or you’re just trying to tone up, your body weight should provide more than enough resistance. A daily regime of simple push ups, squats, and lunges (with varying degrees of difficulty) can get you nicely toned or help you build enough physical strength to move on to more strenuous workouts.

Advanced Strength and Upper Body Workout

I thought I was in pretty good shape considering I do 100 to 150 knuckle push ups and 100 burpees everyday. Wrong!

This 10 different push up by 10 reps by 10 second recovery time workout had me winded by set #5, and severely winded by set #8. Embarrassingly, I honestly had to pause the video after set #8 and give myself a 60 second break.

If you’re looking for an interval/circuit training workout that emphasizes building strength but also boosts your cardio fitness, interval training workouts like these are excellent starting points and lots of users have posted them for you learn from free of charge.

Basic Yoga

I’ve never been much of a yoga person because I’ve always thought most basic yoga techniques are less strenuous than my old football stretching and warm up drills, but if you’re into the stretching, flexibility and getting tone thing, then yoga is something you should consider. Plus, it never hurts to try something new or add some variety to your workout program.

Advanced Yoga

Hot yoga (also called Bikram Yoga, heat yoga, or sweat yoga) is a unique way of taking differing levels of yoga techniques and cranking up the intensity. I’ve taken a few of these classes in my younger years, and it’s definitely not something you should try if you can’t do the basic strength poses, may be claustrophobic (my classes were packed in like sheep), or might not have the mental endurance to tolerate 3o to 90 minutes of 105 °F degree heat.

I included this video because the narrating yoga instructor gives specific instructions how you can replicate a hot yoga studio environment (within reason) by using a space heater, multiple layers of clothes or doing a prior cardio workout like those listed above. If you haven’t done this at least once in your life, you’re missing out!

Basic Sit Ups / Crunches / Core Exercises

No workout is complete without including a few basic core exercises, so it’s important to include a few sets of basic crunches or sit ups into your workout routine. Every personal trainer that I’ve spoken to over the years believes that strong abs takes stress off your lower back, so a few extra minutes a day is worth the bad back insurance policy.

Advanced Sit Ups / Crunches / Core Exercises

If you’re looking for something a bit more hardcore or perhaps you want to take a shot at developing those hard to get 6 pack abs, you need a fairly tough ab workout routine. This video will definitely put you on the right path because it’s a tough, well rounded routine. Plus, the guy has the abs to prove that his program works.

Not sure about his diet plan, though, if you’re specific goal is to get six pack abs. Free runners burn a lot of calories and I’m not sure as many people burn as many as he would. Although a French fries and ice diet does sound appealing!

Final Thoughts

Will a home workout program equal or better a monthly gym membership? It’s debatable. It all depends on how much effort and time you’re willing to put into it.

Many of the “gym rats” that I know do a few benchpresses, a few bicep curls, and oogle the spandex clad ladies taking the kickboxing classes. Not to mention, they usually go 3 to 4 days a week and spend most of their time chatting far too long in between sets, so they probably aren’t getting the best bang for their buck. Of course, one could argue that going to the gym is as much of a social event as it is a place to work out, so getting a good workout may not be their prime objective.

One thing is for certain: the combination of 100 push ups, 230 sit ups and 100 burpees workout routine I completed yesterday definitely had me huffing and puffing just as hard — or harder — had I agreed to pay $34 per month for the gym membership.

In the end, isn’t that what matters most?

This was an original post from Steadfast Finances. For more, follow me on Twitter.

Why Pay Gym Membership & Personal Trainer Fees when YouTube is Free?

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Perhaps nothing encompasses the roller coaster ride that was the 2000 to 2009 decade better than David Faber’s The Bubble Decade. If you haven’t seen it, set 45 minutes aside and take a look back at just how gullible we actually were to follow the herd and buy into some of the most hyped, sure thing “investments” in history.

This quote, from the documentary, pretty much sums up ten years of chicanery, hidden truths and hedged bets…

It was a Ponzi Scheme. No doubt about it. – Josh Harris of Pseudo.com

I still prefer to call it the Greater Fool Decade, since every bubble requires a fool to buy at the top so those who got in early (or caused the bubbles) can cash out their winnings.

This was an original post from Steadfast Finances. For more, follow me on Twitter.

The Bubble Decade Documentary

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Now that the Greater Fool Decade is over, I thought I would dust off my prognosticator hat and do a little strategic planning since we just experienced the stock market’s second worst performing decade ever.

Here are a few of my top, and relatively simple, investing themes for 2010 that will weigh upon the financial markets:

1) Borrowing Money for Consumption Remains Low

The phrase “no credit wanted” might be broad sweeping theme for many U.S. consumers in 2010.

No longer will consumers “bet the farm” or leverage themselves to the breaking point just to buy more stuff. That ship has temporarily sailed. The cost of being an indebted consumer is just too high (20%+), and too much resentment exists from debtor nation to (voluntarily) carry a balance.

Hat tip to Mike Mandel at the Innovation and Growth blog for posting one of my favorite charts of the last decade. If there was ever an X-Y plot to symbolize the irrational behavior of 2000 to 2009, this might be it.

2) More Underwater Homeowners Walking Away from their Homes

If the popularity of walking away from your debts gains momentum in 2010 (I and several others think it will), more Americans who owe more than their home is worth will elect to walk away from their homes even though they can afford their payments.

Americans love to walk among the herd, and if others begin to do it, the sting of foreclosure’s social stigma will become even more diluted. Perhaps walking away from an underwater home will become the default (pun intended) game plan for anyone who finds themselves in this unfortunate position, and willing to take the hit on their credit score.

3) Water (Almost) Becomes More Valuable than Oil

A reduction in rainfall has been wreaking havoc for California farm owners, and while water won’t become more valuable than oil (per barrel) anytime soon, the controversy surrounding water availability for the southwestern states will become even more heated as we move into 2010. It’s not a national debate — yet — because it’s fairly isolated to the southwestern states, but if Governor Schwarzenegger’s appearance on 60 Minutes chanting “We Want Water” is any indicator, 2010 could be a very big year for the water conservation movement.

4) Bond Investors are Herding as We Speak

Like clockwork, the fear of the unknown has pushed more investors away from equities and into the “safety” of bonds when they should be looking for bargains elsewhere. Most of the analysts I’ve seen are very bearish on bonds and suggest jumping off the momentum train before the bubble pops.

(My purely unprofessional opinion only.)

When you find yourself in the the unfortunate position of buying just because everyone else is buying (e.g. the herding mentality), it’s a good idea to switch to a third person view to get the lay of the land and buy the undervalued assets that no one wants for the short term but still has a positive long term outlook.

Got any big picture ideas that will move the markets in 2010 and beyond? If so, please share them with the group.

This was an original post from Steadfast Finances. For more, follow me on Twitter.

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By now, everyone knows I’m something of a wannabe chef. Being that I have so many college football fanatics in my group of friends, it’s not uncommon for me to host a few parties for big football games (Super Bowl, BCS National Championship game, or other Virginia Tech football events).

So I thought I would share a few economical football party food ideas for readers who might want to save money by hosting their own get-together, but might not have the confidence or know-how to pull it off without ordering out. (Alternatively, you could just mooch off of the one good cook you know — like my friends do!).

So here is what’s on the menu for Bowl Week at the Steadfast household…

Mango Salsa

One of the best things about working in Puerto Rico (as I used to) was the fresh mangos.  So I love any recipe that incorporates a fresh mango, as well as giving me an excuse to use up the fresh cilantro that I grow in my container garden.

You can make your own salsa chips if you choose, or you can go with the regular chips from a bag. Either way, this recipe is way better than that yucky tomato based stuff you buy from a can.

Buffalo/Chicken Wings

Nothing is more traditional for a big football game get-together like chicken wings and beer, so it would be a shame to not include them in a post celebrating the last few games of the College Football season.

I included this recipe because Chef John’s method of cooking the wings does not involve deep frying them and smothering them in butter. Instead, he cooks them in the oven at high heat, which is far more healthy. If you want a more crispy crust, stick them under the broiler once they’ve been fully cooked.

You don’t have to use the pastrami recipe if that’s not your thing (it’s excellent by the way!), but can go old school and smother the wings in a store bought buffalo wing sauce. I prefer a sauce like Frank’s Red Hot Original Sauce. If you season them properly, you won’t even miss the butter.

To put my own unique twist on it, I’m making turkey buffalo wings instead of the standard chicken wings because they were on sale earlier in the week. Plus, they’re more meaty than the ordinary chicken wing.

Spinach Artichoke Dip

Spinach artichoke dip is probably my favorite dip of all time. Probably because my brain thinks it’s healthy because of the spinach and artichokes, and selectively represses the fact that I load it up with a ton of fatty cheese.

I use a different blend of cheeses than the Harvest Eating site uses in this video, but being cheese lover, I like a more exotic blend:

• Cheddar Cheese – for the bite.
• Monterrey Jack Cheese – for the melty and gooey look.
• Asiago Cheese – used very sparingly for that “what is that?” taste.

Goes well with regular salsa chips, but I love it on lightly buttered garlic toast.

Gino’s East Deep Dish Chicago Pizza

For full disclosure, I haven’t tried this recipe yet, but I will be making two of them for the Alabama vs. Texas National Championship Game.

Gino’s East is a personal favorite of mine, and every time I go to Chicago, I must must must go to Gino’s East. It’s a personal tradition, and if you haven’t been or your New York Pizza pride won’t let you try it… you’re really missing out!

There are ways to order these types of pizzas via overnight delivery, but I would need a pretty big craving to shell out $50 for such a luxury.

Generation X Finance’s Award Winning Steak Chili Recipe

I’ve made Jeremy’s steak chili recipe twice thus far, and I got to tell ya… it might be the best chili I’ve tried!

The flavor mix of the earthy taste from the cumin/coriander combination with the smokiness from the liquid smoke sets it apart from most other chili recipes I’ve made.  Plus, I’ve always used ground beef or ground turkey instead of chopping up my own steak, so I’m curious if the extra fat from the ground meats was weighing down the flavor profile.

If you’re a chili lover (like me), I suggest you print out Jeremy’s steak chili recipe and file it away say you can pass it over to your grand kids years from now. It’s honestly that good.

This was an original post from Steadfast Finances. For more, follow me on Twitter.

Football Party Food Ideas for College Bowl Week

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I knew the aughts decade, the bubble decade, the lost decade, or whatever you choose to call it was a bad time for stock market performance, but I really didn’t think it was this bad.

Image from Chart of the Day

Pretty depressing stuff when you consider that we started the decade with such optimism, that so much money was made (later lost) on bubbles, and the Greater Fool Theory made an appearance far too many times to make (or screw people out of) a buck.

Maybe I should stop calling it The Lost Decade (my personal favorite) and switch to The Greater Fool Decade.

On a more positive note, if history is any indicator (and it usually is a good one) the next ten to twenty year time periods are times of great prosperity. It’s also further supporting evidence the stock market moves in long term supercycles.

This was an original post from Steadfast Finances. For more, follow me on Twitter.

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I’m something of an oddity in the investing world when it comes to finding the best buy and hold investments: I do not limit myself to a one individual method of stock analysis.

In other words, I’m not 100% reliant upon fundamental analysis where I only review the financial statements and read the 10-Ks, nor am I only using technical analysis where I’m annotating charts, looking for bull flags and only buying at technical support levels.

So instead of being confined by the parameters of an individual methodology, and the specific weaknesses each method possesses, I prefer to take a gauntlet like approach where a collection of stocks will face a series of 4 uniquely different challenges, and only the best companies who get top marks in each challenge will be considered as a potential long term investment.

This way, I can be relatively certain I’m getting reasonably good value for my money, buying at a price with a more upside potential than downside risk, while also investing in a company with a solid business plan poised to improve their bottom line and grow their company.

Why This Concept Works

The crux of my technique is fairly simple: you whittle down thousands of companies and only select from those companies that get top marks (think “A” students above the 90th percentile) in each category.

In this sense, it’s much like that of selecting the best possible candidates to attend professional schools (medical school, law school, etc.) or top 25 business schools where you only take those students that managed to make themselves the cream of the crop by getting the highest grades as possible, doing very well on their entrance exams, so on and so forth.

Hence the use of a Venn Diagram (although overlapping circles are normally used) with four similarly sized boxes with a small overlapping diamond in the center to illustrate the difficulty in finding a few stocks that get top marks for each investment category.

How I Pick the Best Long Term, Buy and Hold Stocks

In the graphic, you will first notice that there are two very different schools of analysis, a bargain hunting “buy on the dips” strategy that mimics value investing, followed by a “gut feeling” strategy that relies mainly on instincts and reviewing the ways a company makes money.

Without going into much detail, this is how I use the individual methodologies to quickly screen a potential stock as a solid buy and hold investment:

1. Technical Analysis. The first thing you should do when to investigating any stock as a future investment is to pull a 10 year chart. This allows you to identify historical peaks and valleys, but also price levels that might serve as resistance levels or support levels where you should hold off on buying, or jump in headfirst because you just found a solid entry point. In many regards, technical analysis doesn’t serve as a solid way of identifying your entry point, but instead, tells you when you avoid the stock and wait for a better price.
2. Fundamental Analysis. Like most things, the fundamentals never go out of style because they’re always useful. If you have a company with a low P/E ratio, good cash flow, high return on equity, low debt, and has a 30 year history of raising its dividend every year, then you’ve found a pretty stable company with a solid management team. However, just because a company looks good on paper, it doesn’t it is a good investment. For example, many oil and natural gas companies had great fundamentals during the oil bubble, but that didn’t stop them from losing half their value in six months.
3. Buy on the Dips. Buying stocks on a price dip is like going on a shopping spree after the Christmas holiday. If you believe a stock has a positive future, but is suffering because of a downturn in normal business cycles or recently suffered a short term setback, then why not take advantage of the market’s generosity by buying one of your favorite stocks at a discounted price. This investing style takes patience, planning, and an ability to ignore the standard doom and gloom news, but it’s a very effective strategy for many value investors. For example, talk to anyone who bought GE under $5 per share or Citigroup under $1 per share.
4. A Believable Long Term Story. Story stocks are those companies that have a long term, well thought out business plan that allows for future company growth, equity appreciation or raising of the company dividend. These are the types of companies that provide a product/service that will be in high demand for many years to come that will increase market share, require new employees, revolutionize the business environment, etc. Of course, you need to be a savvy enough investor to sort the bullish sales pitch from the bulls**t. Examples include Apple, Google, and Amazon.

Remember, this isn’t a catch all technique that you should run out and try yourself without any practice or training. If you’re a novice investor, you should begin by learning one strategy as well as you possibly can, then master the others as time allows.

If you’re an inexperienced investor or simply don’t want to put in the time to do the research yourself, you should highly consider sticking to the Plain Jane index funds or test out your investor skills by starting a stock market simulation game.

If you’re a stock picker, mind sharing any of your selection criteria or stock screening techniques that you use when picking buy and hold investments?

This was an original post from Steadfast Finances. For more, follow me on Twitter.

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I’ve been asking for months now: why haven’t credit unions and small regional banks created a nationwide “Anti-Too Big To Fail Bank” advertising campaign for the sole purpose of taking market share?

Why haven’t they capitalized on this incredible marketing opportunity to draw upon the public’s resentment for fat cat bankers to lure depositors (everyday customers like you and I) to retake market share they’ve lost to the big banks due, in large part, to the big bank “friendly” legislation enacted during the Clinton Administration (Gramm-Leach-Bliley Act of 1999, Interstate Banking and Branching Efficiency Act of 1994). After all, the 20 largest financial institutions only had 35% market share in 1990, but doubled to 70% market share by 2009.

The basic premise of this Anti-Too Big To Fail Bank campaign should be simple, and disclose only the facts:

• Nearly causing a second Great Depression.
• Costing millions of jobs boosting the unemployment rate to 10%.
• Backing millions of risky sub-prime loans that led to the real estate bubble versus sticking to the 3-6-3 boring banker rule.
• Requiring hundreds of billions of tax payer dollars in bailouts to prevent bankruptcy.
• Taking millions in executive bonuses generated from investing capital taken from taxpayers.

I’m sure there are banks that have promoted this concept in non-mainstream media outlets and maybe in a business centric media environment (like CNBC), but thus far, I’ve only seen one credit union willing to promote this message to individual customers/consumers.

~ ~ ~

- Image of advertisement removed at the request of Mission SF Federal Credit Union –

~ ~ ~

This flyer is from Mission SF Federal Credit Union based in San Francisco, and kudos to them for finally saying what the rest of America should be thinking.

Remember, your business is your vote! By continuing to do business with unethical companies, you’re effectively telling management you agree with the way they are conducting business and that they should continue along their present course.

In this case of fighting back against the Too Big to Fail Banks, all you need to do is withdraw your money and bank with a small, community bank like this one.

If you know of a bank that is advertising a similar slogan, please list them in the comments section below.

Photo by guillaumelebleu

(Image is listed as All Rights Reserved, but prior consent was obtained from user prior to posting.)

This was an original post from Steadfast Finances. For more, follow me on Twitter.

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I went on something of a cost cutting, money saving binge for most of 2009.

I found that the stock market crash really affected my spending habits during the first half of 2009, as well as motivated me to review every outgoing dollar in my monthly budget. I like to think I’m something of a value junkie, so I want to make absolutely certain I’m getting maximum value from every dollar spent.

In that regard, I guess you can say I’m Corporate America’s worst nightmare:

• I’m an educated consumer
• I’m highly motivated
• My goal was to save as much disposable income (e.g. their profit margin) as possible.

Since we’re closing in on the end of the year, I thought it would be fun to review some of my favorite frugal living substitutions and other money saving posts from the last year.

Best Money Saving and Frugal Living Tips from 2009

#1) Getting Actively Managed Mutual Funds for Free.

I became something of an index fund convert in 2009 mostly because I observed just how few people actually take the time to do their own research. If you’re not willing to do the research yourself, and since many mutual fund managers charge you anywhere from 3 to 20 times what a Plain Jane index fund will charge you, why not simply take what the market is giving you for minimal cost and be done with it. However, as an alternative, you could also try to find a clever way to get an actively managed (mutual or hedge) fund for free.

After all, if Warren Buffett is America’s most trusted investor… why wouldn’t you want him managing your money?

#2) Healthy Dishes from My Urban Garden for Less than a Buck.

Nothing beats farm fresh veggies, but if you don’t have a green thumb or don’t have a large backyard to start your own garden, a small container garden is definitely something you should look into. Having just a few densely seeded container with basic greens can save you big bucks over the long haul if you eat a lot of salads (like me).

#3) Restaurant Like Meals you can Make at Home for Half the Price.

Learning how to cook, or more accurately, learning how to cook well, has been a big money saver for me the last several years. I’ve actually gotten to a level where I prefer my own dishes to that of the standard middle to upper class restaurants in my area. One of the key components in expediting my learning curve has been cruising the foodie blogs for video recipes, so not only are you getting a standard protocol (biochemist jargon for a recipe), but you’re also getting an experienced cook’s or chef’s helpful hints to give you that little something extra.

#4) Giving MagicJack a Honest Try

Perhaps my favorite frugalhacker experiment of the year was switching to MagicJack.

I was paying Vonage around $300 per year for the same VoIP telephone service that MagicJack can deliver for $20. Sure, it’s a bare bones home telephone service so you should be prepared to lower your standards just a bit if you’re switching from a traditional landline, but the immense cost savings (1^st year savings $243/year, future years will be $280/year) is worth the limitations and the occasionally annoying sales pitch.

#5) Giving Up Soda.

I’ve been an avid soda drinker most of my life, so it was an extremely odd feeling for me to admit that that I’m one of those pro sin tax / fat tax commies who agree we should begin to tax America’s favorite sugary concoction since it is one of the primary agents responsible for the obesity epidemic.

So when I began to think how much soda I (formerly) consumed every year (2 to 3 per day totaling 750 to 1000 cans), then back calculate how much that total would amount to in potential dollars saved and calories I had to walk/jog/lift weights to burn off, it was a no brainer to jump off the soda bandwagon.

I still drink two or three Cokes or Sprite Zeros every month, so it’s not like I completely eliminated them from my expenses, but I imagine the liberated feeling I have now after giving up the mandatory Coke for breakfast is analogous to how a 20 year cigarette smoker must feel after kicking the nicotine habit or an alcoholic who doesn’t need that comfort drink just to feel at ease.

#6) I Haven’t Bought a Music CD in over 10 Years.

When I realized earlier this year that I had effectively given up CDs for so long, I couldn’t quite wrap my mind around it at first.

When you consider just how odd it is to go a decade without doing anything, it really makes you begin to stop and think about how powerful the Internet’s massive disintermediation effect has had — since MP3s trumped CDs –  and will continue to have, upon global business.

Then again, considering how much I rely upon free streaming music via the Internet  (Slacker.com and Lala.com are my personal favorites), it’s not surprising that CDs went from must have technology to the old standby.

#7) Giving a Gift Someone Actually Likes or Wants Immediately Doubles its Value.

This was probably one of more creative ways of tweaking my shopping habits this Christmas. Instead of the standard anticonsumerism argument (buy less, spend less, don’t buy, etc.), this concept involves getting the max “joy of giving” value out of giving a gift, as well as the recipient getting maximum value from whatever you gave them. When you add these two metrics together, they can equal double the cost of whatever you paid.

This was an original post from Steadfast Finances. For more, follow me on Twitter.

My Favorite Frugal Living Substitutions of 2009

• Giving a Gift Someone Actually Likes or Wants Doubles the Value
• 40th Money Hacks Carnival
• Weekend Reads: Three Day Easter Holiday Edition
• Vulture Investing: Buying the Joneses Stuff at Half Price!

• 'The 5 Lessons a Millionaire Taught Me' Review
• Preparing for Black Friday
• Is It The Little Things Or The Big Things That Add Up To Your Money Problems?
• Weekly Roundup - Confession Edition

What a snow storm!

Three days plus 90 minutes without electricity, 3 days without tap water (after power was restored), and 6 days without cable TV & Internet service. Not to mention pulling two people out of a ditch, shoveling 2 rather long driveways by hand, and the personal discomfort of bathing from the heated pot of defrosted snow for 6 days.

Perhaps I made a mistake asking Santa Claus for 2 feet of snow for Christmas and not including in the fine print that he:

• not knock out the power with 13 inches of snow.
• not make me defrost snow to use for bathing and waste disposal.
• not make me go without CNBC and ESPN for a whole week.
• not shut down my Internet connection for 6 days.

Very funny Santa! Ha – ha – ha. You got me again! (You fat bastard.)

I’ve experienced severe winter weather chaos before, but this storm definitely takes first prize. Having grown up in the Appalachian mountains and experienced 3 to 4 feet of snow as a kid, and thrived during the infamous Raleigh-Durham ice storm of 2002 when 4 to 5 inches of sleet shut down basic infrastructure almost immediately (electricity, transportation, water, etc.), I know a thing or two about being snowed in.

So you can bet that I’ve done the strategic planning to attenuate the snowstorm after effects and greatly reduce any chance of supply shortfalls well in advance of this storm arriving, as well as made a few larger purchases to make sure if it ever happened again, the problems related to the storm would be nothing more than a minor inconvenience.

Today, after finally getting to shower like a normal human (man was it swell!) and finally getting email access to swap “horror stories” with friends around town, I’d say we performed better than your average household. In fact, other than a home with an electric generator to operate a satellite television and a cistern to provide hot water, I’d say we had a very comfortable roughing it experience when you consider many people were forced to rely upon assistance from the National Guard and disaster relief organizations.

Must Have Supply List for a Severe Winter Storm

After having so much free time on my hands, I jotted down a bare necessities list, as well as a nice to have luxury list of items that you might want to consider acquiring if you live in an area where a serious snow storm can shut down the basic life giving services you rely upon.

1. Drinking Water. If you suspect severe weather coming your way, gather as much fresh water in clean containers as you think you will need, then triple it. I like triple redundant fail safes whenever possible, so unless you want to eat snow or collect rainwater, store as much drinking water as you can in non-leachable containers.
2. Ready to Eat Foods. You can go as high end or low tech as you want with your emergency foodstuffs. Anything from high calorie MREs and energy bars to as basic as crackers and vanilla wafers should do the job, but make sure that all you need to do is break the seal and chow down. Anywhere from 2 to 3 days reserve is a good place to start, but a little extra never hurts. I store and consume these foods until they near their expiration date, then restock as necessary.
3. Heating source. Whether you have a wood, coal, gas fireplace, or some other type of non-electric portable heater, it’s useless if you don’t have the accompanying fuel to operate it. Keep a small to medium stockpile around for emergencies, and if you must, go hunting for more prior to the storm doing its damage. If you planned well, your heating source will double as a cooking station.
4. Emergency Lighting. Having 2 or 3 handheld flashlights around is a must have year round, but if you didn’t buy the batteries, candle light is the next best thing. Most people have a few scented candles around the house anyway, so unless the power is out for more than 3 days, you should be good to go. I keep a dozen 12 inch dinner table candles in the pantry for exactly this type of event. You could also use old school oil lamps if you’re lucky enough to have them with the proper fuel source.
5. Batteries. Being a Lowe’s and Home Depot junkie, I’m always on the lookout for summertime clearance sales bulk sized packages of non-rechargeable batteries. As it turned out, having multiple 24 packs of AA, AAA, D and 9-volt batteries was a pretty good idea. Had I been an unethical person, I could have made a killing selling individual batteries for $5 a pop once every store in town sold out. Better to have too many than too few so the adage goes.
6. Ways to Make Fire. Call me a pessimist, but I’m betting there were a few households that didn’t have a way to light a candle or start a fire. At the very least, one should keep a small number of matches or a few cigarette lighters in a safe, easy to remember location that can easily be found once the lights go out.
7. Cash. No power and no Internet service typically mean your debit and credit cards are useless. So you’re going to need an ample supply of cash money to buy whatever you need until modern technology is restored and/or your local bank re-opens its doors since the ATMs are also useless. We keep $300 in cash for emergency use only in the house, as well as around $50 on our persons at any given time. (I suppose I could have bought $1750 worth of store credit with an American Eagle gold coin, but I probably would have gotten a very confused look from the cashier.)
8. Disposable Water. Unless you want throw your “honey pots” out of your bathroom window Medieval Times style or do your business out in the cold, you might want to fill your cistern or a bathtub full of potable water to use for waste disposal. It may sound extreme, but you may need it for washing dishes, filling the storage tank of your toilets, or maybe even putting out a fire caused by candle light (in case you do not have a fire extinguisher). Most homes are dependent upon water being pumped from treatment centers, so when the power goes out, those pumps stop working and the taps eventually go dry. Ironically, that’s when the snow on the ground goes from nuisance to life saver.
9. News and Information. Using an old school AM/FM radio (my alarm clock has one) is still one of the mainstays of the Emergency Alert System, so when the Internet “breaks” and your cable TV provider can’t deliver, falling back to the early 1900’s standby is one of the easiest ways to gather information. A television with rabbit ears could also be a suitable means for picking up local channels or public broadcast television.
10. Cell phone. If you’re like me and rely solely upon a cheap VoIP home telephone, any disruption in your Internet service means you’re back to using smoke signals without a cell phone. I’m not saying that everyone needs one (my girlfriend carries our only cell phone), but they are extremely handy when landline connections are severed. A case for satellite TV (DIRECTV or Dish Network) a few neighbors with a generator and DIRECTV got to watch football this weekend and I didn’t.

Nice to Have Luxury Items

For those who have experienced this sort of thing before or have a well thought out plan, you probably have a list of “luxury items” that provide some semblance of modern living even though the power is out.

Here are a few from my stockpile or wish list:

1. Gas Powered Generator. They’re expensive and can be difficult to install, but nothing is more morale boosting than having electricity when your neighbors don’t. Considering the cost of diesel fuel these days, they’ll cost you anywhere from $2 to $4 per hour to run, but if you’ve got the dough to spend and don’t mind feeding the gas guzzler once a day, then a backup generator deserves the top spot on the luxury item list.
2. Cast Iron Wood Stove with Flat Cooktop. Our home doesn’t have the traditional open fireplace. Instead, we have a brick & mortar mantle with a cast iron wood burning stove. It can heat most of the home if called upon, but also provides an easy alternative for cooking when the power is out. We ate very well thanks to our wood stove, and I would highly recommend making one of these a high priority item if/when you’re buying a home in the future.
3. Gas Grill. Many people have the standard propane powered grill sitting on their deck, so dust off the snow and pretend you’re cooking at a tailgate celebration before the big game. It may be 20 degrees outside, but you’ll be surprised at what you’re willing to do when you’ve been eating vanilla wafers and energy bars for two days straight. Plus, the meat in your freezer will begin to defrost after 2-3 days without power, so better to grill it up before it spoils or fighting off the scavengers by storing it in the snow. A charcoal stove works just as good, maybe better, if you have ample charcoal and/or firewood to use as fuel.
4. Camping Stove/Kerosene Heater. I have a portable Coleman cooking stove for camping trips, which can double as a gas grill, as well as a last ditch means of keeping warm. The most I’ve ever gotten out of the fuel source was around 4 hours of continuous cook time, but it’s an extremely convenient and useful tool to keep in your arsenal. Kerosene heaters also work equally well as a food prep and heating station, but not nearly as portable. (Note the triple redundancy of items 2 through 4.)
5. Things to Keep Your Mind Occupied. The most difficult thing about having no power, at least for me, is keeping my mind occupied. Moreover, it’s probably even more difficult when you’ve got children in the house, so having multiple playthings around to keep them occupied is certainly high on the luxury item list. Shoveling snow, gathering firewood and “doing stuff” with your significant other are great ways to keep yourself busy, but a few good books or boardgames to pass the time never hurts. I read a few of my old psychology and biochemistry textbooks, as well as a dusted off an old Tom Clancy novel to avoid going stir crazy.
6. Solar Energy Chargers. Even though your cell phone will work in a power outage, it will not last forever without a recharge every 2 to 4 days. If you’re an avid camper that can’t go without your Blackberry or iPhone, a portable solar energy recharging device for your mobile phone might be the way to go.
7. Best Snow Shovel Money Can Buy. Nothing like 13 inches of snow to make you realize how indispensible a well-made snow shovel is worth. If you disagree, try shoveling snow with a regular sized dirt shovel and see how long it takes you compared to a snow shovel.
8. A 4×4 Truck/SUV. If you absolutely have to be driving (as I did to pull my girlfriend out of a ditch), nothing beats the reliability of a 4×4 in snowy weather. Yes, the gas mileage is less than desirable and they’re not as cost effective as a Honda Accord, but in times of inclement weather, which would you rather have? If you live in an area where snow is a legitimate concern, having at least one vehicle with four wheel drive capability is option/upgrade you might want to put on your wish list.
9. Wireless Internet Card. If you have an Internet enabled cell phone, you’re probably in good shape if you’re just checking email or sending a few text messages. However, if you’re an Internet power user (you have a web based business or a blogger), keeping a wireless laptop card for your laptop might be a good backup plan. Considering that Comcast hooked me with their “satellite is so unreliable” sales pitch, but failed me for 6 days straight with both no cable TV and no Internet service, giving them the boot is a viable option. Alternatively, my switch from landline DSL service may have been a mistake considering how dependent I am on them for entertainment and business purposes.
10. Emergency Road Side Kit. While many would agree some parts of this kit are a year around necessity, I think it’s a bad idea to be on the road during a severe weather event. If you must travel, a good roadside emergency kit for a 4×4 vehicle during a snowstorm will contain:  1 large blanket, 2 emergency flares, a flashlight with fresh batteries, a Leatherman utility tool, extra oil and radiator fluid, jumper cables, 1 bag gravel (kitty litter works well), 2 bottled waters and pack of energy bars, matches, a dirt shovel and snow shovel, and a 30 foot towing chain. Yes, it’s overkill, but you’ll thank me if I’m the one that stops to pull you out of a ditch.

All in all, this ad hoc camping trip wasn’t all that bad.

Sure, you can probably make a few jokes that I’m some sort of wannabe survivalist, but from my vantage point, many people have a tendency to wait until last minute, and in the worst case scenario as I just experienced firsthand, the last minute would simply have been too late. So I would rather be called a survivalist (there are far worse insults) than stand in Black Friday like waiting lines for hours in the freezing temperatures just to get a few gallons of rationed kerosene and a few MREs.

Got any horror stories from a past snow storm? Learn any basic survival tips or techniques that might help the group? How about a must have or luxury item that wasn’t on the list?

~ ~ ~

This was an original post from Steadfast Finances. For more, follow me on Twitter.

Maybe Asking Santa for a White Christmas was a Bad Idea

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Sorry for the delay in posts everyone.

With the severity of the snowstorm that hit Virginia prior to the Christmas holiday, we lost electricity for 3 days, Internet connectivity for 5 days and we’re entering day #2 of the water shortage.

I’m still trying to catch up with a backlog of hundreds of emails, but I should get a longer than normal post up tomorrow about the entire “snowed in” ordeal and how we are still roughing it.

More to come… and Merry Christmas to you and yours!

This was an original post from Steadfast Finances. For more, follow me on Twitter.

Back on the Air!

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Occasionally, there is that one ad agency that just seems to know what the people want to hear.

The companies/organizations mentioned below, along with their ad agencies, combined forces to put together that perfect advertisement that sticks in the head of (potential) consumers or reinforces their brand dominance to the point that no other brand can take their place.

Being that I spend so much time focusing on consumer education, I like to evaluate how very catchy or memorable ad can affect my behavior toward the message they’re trying to convey. What makes an ad memorable versus easily forgettable, what makes them clever versus lame, or maybe what they did so horribly wrong that makes me dismiss it within two seconds of seeing it. Occasionally, the best ads are those designed to prevent me from doing something, or re-evaluate my consumerism habits altogether.

It might sound overly analytical, but advertising is more psychology based than you might think. And if they (e.g. the advertisers) can tap into that little thing called your decision making process, they might have just changed your mind forever.

So to reward those companies and ad agencies that got it right this year, I’ve compiled my top 5 commercials from 2009 with a web only ad you might not have seen.

The criteria for selection was fairly straightforward:

1. Get me to watch the whole ad. If you, as the advertiser, can even get my attention — you’ve done something pretty special. So when you can come up with something clever to keep your message, slogan or byline to hold my attention until the end of the 15 second ad, kudos to you.
2. Don’t be so [bleep] pushy! Like a growing number of people, I’m steadily growing immune to advertiser’s “pay attention to me” antics. More and more advertisers are beginning to trashy up their best content with their pushy ads within the program itself or installing a 10 second “look at me” ad over their web page. The more outlandish they get, the more I label your brand a big fat #FAIL. (Note the use of a Twitter hash tag.)
3. Don’t be salesy! I realize it’s your ad and you’re paying money to make money, but do not waste your money just to remind me it’s a “limited time offer”. I want to buy things on my schedule — not yours! And I couldn’t care less if it’s the end of the quarter and you haven’t made your sales quota!
4. It’s genuine, honest and real life. People want truth in advertising. They don’t want to be misled, and if you do, your brand will suffer greatly. Articles published on the web stay there forever, so if you’re on Ripoff Report or The Consumerist, you need to change your ways and hire a few more people in the public relations department.
5. Be clever. The reason these ads made the list is because they’re clever. Period. If you’re an advertiser reading this post, please connect the dots and learn how to improve. If you’re a brand manager, hire the creative minds responsible for writing and/or producing these ads!

Best TV Commercials of 2009

In no particular order, the winners are…

#1 – Lending Tree with Adam West

The hook line: Today you are not just Scott. You are… Great Scott!

As a Family Guy addict, I immediately knew this was the voice of Adam West (aka Mayor West, aka Batman). I know of Lending Tree very well since I run a finance blog, but I actually clicked over to their website solely because of this commercial.

It’s clever, it’s funny, and I’ve probably used the phrase “financial tomfoolery” dozens of times in my everyday speech.

#2 – NYC’s Anti-Soda campaign: Are You Pouring on the Pounds

The (unspoken) hook line:  it’s so disgusting that you can’t stop watching!

I’ll admit, I’m completely biased because I’m pro sin tax on sodas, and I’d likely support a fat tax on all junk food for that matter, but I like this commercial simply because I know it’s true. If you drink one soda a day, you’re drinking around 5% to 10% of your daily caloric intake with zero nutritional value, and that will definitely pile on the pounds if you have a slow metabolism or live a sedentary lifestyle.

Naturally, you can disagree all you want on the issue, but you have to admit… the mental image of a guy drinking fat really sticks in your brain!

(Anyone remember the Friends episode? You were really going to “drink the fat”!)

For more, checkout the NYC Dept of Health’s Facebook group.

#3 – Texting While Driving from the UK

The hook line:  pure unadulterated reality!

Zipline Creative is an ad agency based in the U.K. and they deserve serious props for creating an advertisement that is 100% real. I’ve seen a car accident like this up close and personal, and let me just say, it looks as just as savage (even more so) as this commercial portrays.

If you have a teenage driver who doesn’t get the message the texting while driving is dangerous, have them watch this video. I just wish this video could get past the U.S. censors instead of relying on YouTube to push it virally.

#4 – Hulu’s First Ad with Alec Baldwin

The hook line:  Because we’re aliens… and that’s how we roll!

I had checked out Hulu prior to seeing this ad, but really didn’t give it any real consideration as a legit place to waste 20 minutes of my time. After the hilarious commercial, I went back and checked it out again.

Strange how that works… isn’t it? I didn’t like the site prior to the ad, but after a clever commercial, I did.

Persuaded much?

#5 -Discovery Channel’s “‘Boom De Ah Dah” Song

The hook line:  Boom De Ah Dah… Boom De Ah Dah… Boom De Ah Dah… Boom De Ah Dah.

I’m a sucker for a catchy song. I’m the sort of guy that sings the Scooby Doo theme song for hours if I hear it while flipping channels, so it’s not surprising that Discovery Channel hooked me with this catchy tune.

Not to mention, I watch their channel more than any other channel on TV other than CNBC. Call me biased because I’ve had a Dirty Job like Mike Rowe, but Discovery’s content is far superior to the mindless dribble of American Idol.

Bonus Web Video – Bud Light Lime and Getting it “In the Can”

The hook:  Last night, I got it in the can… and I loved it!

I love edgy humor that pushes the boundaries of what the social construct finds acceptable. Ads like these remind me of George Carlin’s infamous Seven Dirty Words because it’s one of those gray areas between should I laugh out loud, should I hold my laughs until later, should I avoid clicking the “share with others” button because my politically correct boss might see what I find funny because he just friended me on Facebook or should I secretly vote it up on Digg because it’s relatively anonymous.

Maybe I’m being too cynical, but I don’t really see why this sort of ad can’t be aired on mainstream TV when I’m forced to suffer through 2 to 5 erectile dysfunction commercials during a football or baseball game.

Got a favorite ad of 2009 that wasn’t on the list?

If you have a favorite ad that you found usually catchy or might have influenced your behavior this year, be sure to mention it in the comments section below.

This was an original post from Steadfast Finances. For more, follow me on Twitter.

My Favorite Commercials of 2009

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• More Fishing and Boating Lexicon

Leave it to Colbert’s crack team of writers and producers to catch weeks of targeted advertisements and distill them into an easily observable trend. This time, it’s gold coin and bullion distributors (e.g. resellers) advertising on conservative news sources cleverly designed to make more money off the retail investor by pounding the fear trade.

I don’t watch Fox News (or MSNBC for that matter), but like Colbert, I think it’s highly suspect that gold coin distributors are targeting the more conservative crowd since they are more likely to buy the hard sell, doom and gloom story the gold bugs are pitching.

If history is any indicator (and it is), such advertisements for the general public are usually one of the warnings signs of an investment bubble ready to pop instead of the no-brainer investment the advertiser suggests.

[RSS and email readers please click to site for video]

For the record, I fully believe that gold is in bubble territory and there are multiple reasons why you should think twice before rushing out and buying as many gold coins as you can afford.

Of course, these hard sell ads fail to mention (unless it’s in the fine print) that gold distributors like these routinely mark up the price of their gold coins around 35 percent. With that sort of retail markup, you better hope that the gold story continues to gain momentum and hits the $1500 range just so you can break even. (Gold is trading at $1104/ounce at the time of publication.)

~ ~ ~

Disclosure: I am neither long or short gold at the time of publication.

This was an original post from Steadfast Finances. For more, follow me on Twitter.

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I’m fascinated by the consumerism trend of acquiring stuff. Somehow, consumer psychologists and advertising geniuses the world over have joined forces and sought to convince all of us that it’s in our best interests to buy “stuff.”

Regardless of whether they tapped our false belief that acquiring goods will boost our perceived self worth (or our social status), preying on our emotions since sad people spend more money, or you simply felt that you had to buy because everyone else was buying… it’s been a highly effective PsyOps campaign.

To counter this pseudo propaganda, I’m going to throw out my own visual representations of how I view the anti-consumerism movement and perhaps one of these images will burn itself into your brain and haunt you the next time you’re thinking about signing away away a few additional years of your life by taking on additional liabilities.

How the Things You Own End Up Owning You!

#1 – How much time do you work for XYZ object?

For simplicity, let’s say you bring home $200 per day after taxes, insurance and retirement savings. If you have a $2000 mortgage due every month, you’re working for 10 days or 2 whole work weeks just to keep a very expensive roof over your head. If you have a $500 car payment, you’re working 2 and half days. Throw in the mandatory fees that come with these two items (insurance, taxes, etc.), and you’re talking another 2 and half days of bring home pay.

This means you have just 8 working days in the month of December where your money is actually your money, and not on a predetermined course to repay one of your creditors. One could argue that this money isn’t really even your money anymore because if you don’t repay your debts, you won’t have a house to live in or a car to drive.

Of course, this doesn’t take into account the cell phone, cable bill, past credit card debt you may or may not have, and any other regular expenses and liabilities you may owe every month. (Please note, I was highly generous in not including any other liabilities/expenses on the calendar.)

#2 – How much product must you churn out?

The world always needs ditch diggers (as the adage goes), and let’s just say that it’s your job to dig ditches in order to get paid. So every day, your calloused hands and aching back have to shovel X pounds of dirt at Y depth for Z miles.

Which is an pre-algebra word problem method of asking: how productive do you need to be to generate XYZ dollars to keep your stuff?

If you’re a writer, how many articles do you have to write per day? If you’re a football player, how many tackles or touchdowns do you need to make per year to keep your multimillion dollar salary?

(Have you noticed the ditch is never ending yet?)

Units produced to cover your outgoing cash flow is a very effective metric to reduce your spending when you actually consider how much you have to work to meet your financial obligations.

#3 – Who really owns your stuff?

Home ownership is a bit of a misnomer for anyone who has a mortgage. If you disagree, just ask your mortgage lender what happens when you stop paying your monthly bill.

Which poses an interesting dilemma: if your mortgage banker owns your house, and you’re paying him for the right to live there, does he really own you since you’ve obligated yourself to repay what you owe? Debt is slavery after all!

If you have a healthy disdain for the banking industry, you might want to considering joining the fight against the Too Big To Fail banks. By simply ceasing to do business with them and refusing to buy their #1 product (e.g. money), you’re sending a message to the folks sitting in the ivory towers that the cash cow lending business is going to shrink by a factor of you!

#4 – How much does your stuff cost you to move, store, or maintain?

Have you run out of places to keep your stuff? Is it so valuable that you can’t throw it away, but so invaluable that you can’t keep it in your house? Do you have to visit your stuff like you would a extended member of your family – once every 3 months as a chore?

When you’re paying to keep stuff outside of your primary residence without a very good reason, you might want to re-assess your life goals on what is important to you, and what isn’t.

#5 – How much are losing by selling your stuff second hand?

Everyone knows that buying a new car is a bad financial decision. Why? Because most new cars lose half their value within the first two years of ownership.

So why should your less expensive stuff be any different? If you’re fortunate enough to know that hoarding your gifts away in a storage unit is a bad idea, you’re probably smart enough to figure out that buying a stereo for $100 and selling it in a garage sale for $25 is a terrible investment. Unless, you don’t mind losing 75% on every investment you make. (If so, hope you have a pension plan and not a 401k!)

Remember, if you don’t buy it, you never have to yard sale it!

~ ~ ~

Photos by Atli Harðarson, wallyg, Penningtron, NicestAlan.

This was an original post from Steadfast Finances. For more, follow me on Twitter.

Visualizing How Your Stuff Owns You

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I’m not an expert in business trends by any means, but it really seems like the disintermediation opportunities the Internet provides is beginning to replace, well… almost everything.

Think about this for a moment.

Where do you check the morning news? Where do you get your music? Manage your money? Place phone calls? Do your research? Do your taxes?

Perhaps a better way to pose this question is to think about the old school, stalwart companies that held market share dominance for several decades/centuries, and now their middleman status is beginning to be sidestepped. In some cases, it’s being made obsolete altogether.

Internet Businesses Excel at “Cutting Out the Middleman”

1. Music. I marvel at how long the music industry lured $5 to $20 per CD/cassette out of people like me for so long, but were quickly brought to their knees by online properties like Napster, iTunes and YouTube. I’ve never agreed with downloading pirated music, but I haven’t bought a music CD in over 10 years thanks to free music sites like Slacker.com, Pandora.com, or even YouTube.com. Plus, basic radio is still free (but laced with crappy ads)!
2. Traditional Landlines. Cell phones were probably the biggest hit to the old school Baby Bells (even Verizon admits landlines are an oil well about to go dry), but even relative newcomers in the VoIP space like Vonage are beginning to feel the pinch by extreme cost cutting servicers like Magic Jack. I’ll be saving over 81% in the first year and 93% each additional year from this technology upgrade alone.
3. Cable TV. How many articles have you read about consumers disconnecting their cable television and turning to the web to watch favorite TV shows online? I’ve probably read 100+ in 2009 alone. With so many people dropping their cable service, it’s not surprising that cable companies are beginning to purchase high traffic, highly frequented online video properties (e.g. Comcast acquiring majority stake in Hulu.com) in order to retain/grow their subscriber count, as well as the ability to control the distribution channels of video content.
4. Peer to Peer Lending. Banking institutions cornered the market long ago on the generous rate of return the lending market provides. P2P Lenders like Lending Club and Prosper combine borrowers with investors who seek greater returns (around 10% on average) than those provided by savings accounts and CDs with less risk than investing in the stock market (depending on the quality of borrower or course). By bypassing the “too big to fail banks entirely, investors boost their ROI while simultaneously lowering the cost of investment capital needed by small businesses and entrepreneurs, or savvy consumers who demand a more competitive interest rate to repay debt.
5. Real Estate & Realtors. Realtors had a pretty sweet business model during the real estate bubble where they would show a few homes, offer some advice, and cater to the beck and call of potential buyers. They have a fairly difficult job but I’m not sold on the idea they deserve a six percent commission (shared 3% buyer’s agent & 3% seller’s agent) just because they facilitate a real estate transaction. With sites like Craigslist.org are making housing swaps more common, it allows home owners to keep thousands — maybe tens of thousands — in their pocket by allowing like minded home owners come together in a much larger forum and close their transaction without the middlemen.

Obviously, certain businesses have their jugular exposed more than others. For example, I really doubt Exxon Mobil is going anywhere in this world considering that we are still sucking on the fossil fuel teet and they have tremendous capital reserves. However, old school businesses like Kodak and printable pictures didn’t stand a chance once online photo sharing and storage went mainstream.

Perhaps the irony I find in the Internet’s disintermediation potential is that over a decade ago, I remember listening to the constant chatter that the Internet would never get past nipping at the heels of slow paced, or “evolution resistant” businesses that could never be replaced. Now that we’ve flashed forward 10 years, I’d say in many cases, the Internet went from nipping at their heels to taking a gigantic bite out of their ass(ets).

What about you?

What do you do today at a much lower cost, or far more efficiently, than you used to do 10 to 15 years ago? Do you see any other industries that are a prime target to be excised by a creative entrepreneur with a big idea and even bigger ambition?

(And yes, I know I just slammed myself for referring to a “pre-Internet” world.)

This was an original post from Steadfast Finances. For more, follow me on Twitter.

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