Money Monday: Buy from Bed Bath & Beyond

I did some comparison shopping: Amazon, Walgreens (which is the West Coast equivalent of CVS), and Bed Bath & Beyond and can confirm that you save the most if you shop for your toiletries at the BBB super store (the one in SF carries toiletries) and use these coupons.

Save at Bed Bath & Beyond

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I collect these coupons like a prized stamp collection. I sign up for the BBB mailings here. I’ve signed myself up using different names and the same mailing address. I signed my parents up so that they can give me their coupons. Then I stash all of them, including the ones that people in our apartment complex dump in the recycling bin, in our car. So whenever we happen to be at a BBB, I grab my coupons from the glove compartment. I have like 50 of them at any given time! That’s 20% off every single toiletry item. That’s $5 off expensive containers of contact solution or a pack of razors.

Love BBB.

Money Monday: The Rigors of Getting a Mortgage in this Economy

My friend Affinity who wrote this fantastic post on retiring early, agreed to write another post on getting a mortgage in this challenging environment. She made the move from San Francisco to Oakland and had this important advice to share. This is exactly what I needed to hear. While we are not in any rush to make a move, Dean and I are always on the hunt and having all of these items in place will only make the home purchase process that much easier. Take it away, Affinity!

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My husband and I had owned two units in a tenants-in-common building in San Francisco, where we had purchased the building with a group loan and then later converted to individual loans on each unit, so we were not newbies to purchasing a home or the mortgage acquisition process, but it is much more difficult than it used to be.

The mortgage process is all new, and not for the better. We have a credit rating of over 800 and savings appropriate to a couple retiring in their mid-60s, so we thought the process would not be difficult. Here are my suggestions for making it as painless as possible:

1. Do not overbuy. Buying a house that is a little less than you might like may not appeal to you, but it will make it easier to qualify for a loan.  Lenders are much stricter about your proving you can service the loan than they were prior to the foreclosure crisis of the last few years. In order for us to do that we had to move to Oakland from San Francisco.

2. Most lenders now require a 20% down payment unles you qualify for a special program of some sort. We put down 25% to improve our interest rate. So have your cash in order before you start.

3. During the loan approval process do not buy a car, run up any credit cards, or make withdrawals from your savings, except to move the loan process forward.

4. Have your taxes done and filed. We purchased in February 2013, and our lender wanted us to provide a 2012 return, which we had not filed yet since it was not due, and then they contacted the IRS directly to verify that it matched the IRS return we had given to the lender.

5. Since our condo had been purchased by the seller in the last 12 months and was then being resold to us (flipped), our lender required two appraisals, that then stretched over the next six weeks. So that means you have to be patient.

6. They want every financial document; bank statements, brokerage statements, your W-2, etc. for the preceding 2 or 3 months, and if the loan approval process stretches over longer than a month, then they want you to provide fresh statements.

We had problems with self-employment and seasonal W-2 income. The lender wanted a statement from our accountant that we have a legitimate business. Since we do not have an accountant, they did not want to use the self-employment or seasonal income as part of our ability to pay the loan. This seemed a little odd since we were not only paying state and federal taxes on the self-employment income, but social security (F.I.C.A.) as well. We had had the same seasonal income for over 10 years and it was even W-2 wages so this was an unpleasant surprise.

7. Check your credit. Contact Experian, TransUnion or Equifax for one free credit report a year. You should have a credit score of 720 or higher. Check for errors or small bills that might not have gotten paid. Credit Card debt should not exceed 50% of your credit limit (although in general I recommend you pay your cards off every month). If your balance is above 50% you may be able to get your credit card company to increase your limit.

8. Apply for the loan before any transitions or retirement. We had just retired, and the lender did not want to rely on our W-2 wages since we no longer had jobs, and we had not yet taken any interest or dividend income since we had finished out 2012 living on our savings rather than taking money from our savings accounts, so we had a problem proving we had the investment income to service the loan.

If you are retiring and you have assets, but not much visible income, both Fannie Mae and Freddie Mac allow your lender to “annuitize” your assets by making a conservative estimate of what your savings/IRAs/assets would generate as income if spread over the life of your loan. In addition, if your are eligible for Social Security but have not chosen to start receiving it, you can generate an estimate to show your lender what is available to you.

9. This is going out on a limb, and you know I could be wrong, but prices are rising, at least in the San Francisco Bay Area. If the tech boom continues, prices may continue to rise, so if you are thinking of buying a home this might be a good time, for some stats on prices rising click HERE.  But then, this bubble may end soon, we will have to wait and see.

Why are things so much more difficult? The many foreclosures and short sales over the past few years have made everyone more cautious about lending money. Not only was there malfeasance on the part of the big banks, there was a lot of fraud on the part of borrowers. Many lenders sell your loan to the F.H.A. and they have to prove a much higher level the borrowers ability to pay back the loan since the financial crisis of 2007-2008. Good luck, we survived the process and are very glad we did. We now live in the Adams Point neighborhood in Oakland.

It has been fun talking about money, feel free to contact me if you have questions: affinitymingle@gmail.com.

I also have a plus size fashion blog and I would love for you to stop by and check it out if you have an interest or know someone who might enjoy it. It is more of a D.I.Y., how to make it work and a resource blog than a true fashion blog. http://affatshionista.com/

Money Monday: Missed Housing Opportunity

I have a set of housing criteria which filter out some real housing gems. One of these criteria is a parking spot which this condo in the Inner Richmond does not have. It’s already in contract and I swear if I had known about it, I would have pounced on it. It’s located just past Laurel Heights (one of my former beloved ‘hoods) near Arguello and Geary in San Francisco. It’s centrally located with a multitude of bus lines that will take you wherever you need to go in the city. And at discounted prices because it’s not in the hotbed of the Mission or SOMA or Potrero Hill. What a steal, especially since people are paying upwards of $700,000 for dorm-room lofts in those areas. Advice: broaden your range and criteria. There are deals to be had out there!

262 3rd Avenue – $429,000 – 2 bedrooms, 1 bath, 0 parking condominium

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Money Monday: Tips on Having a Successful Internship

It’s that time of the year when students are getting a taste of what it’s like to bring home the bacon with summer internships.

Before I delve into this post, I just wanna say I’m so glad I was born in 1975 because I never had to worry about internships early on as a student. In high school, I was biking around the neighborhood and volunteering at the hospital. In college, I was desperately trying to pass Physics and surveying trees at Forestry Camp. The only time I ever had a paid internship was the summer in-between my 2 years getting my MBA. I hated it, but that was irrelevant. Just because you detest the work doesn’t give you license to suck.

Tip #1: Underpromise and overdeliver.

Tell whoever you report to that while you’ve never done this kind of work before, you’re going to work day and night to make sure you understand the ins and outs of the business. This is very important: this is your opportunity to absorb and learn. If you don’t know, ask questions! You’re the intern. It’s ok to not know. After your internship is over, if you still don’t know, that is a big problem. You probably won’t get hired and if you do, that’s worse because you won’t know jack shit and people will wonder why you’re such an idiot. You will never get this opportunity again. Don’t let it slip. Ask, absorb, learn, network. No question is a dumb question. Ask, ask, ask!

Tip #2: Appearances are everything.

Wear a suit. Dress a notch better than everyone else you will interact with. Be the first person at work. Be the last person to leave.

Tip #3: It’s not about you. It’s about your boss.

Forget about all those thoughts in your head about whether or not this is the right job for you. It doesn’t f*ing matter. When you’re staring at a handful of offer letters, that’s when you can start having those ‘What do I want to do with my life?’ conversations. Right now, it’s all about having a successful internship and landing an offer when the internship is over. Bottom line: make your boss look good. Your job is to make your boss’s life easier. If you notice that your boss is spending an inordinate amount of time running reports, learn how to run those queries and take on that responsibility. If you notice that during meetings no one takes notes, then take notes and distribute them to the team. What a great resource for someone who missed the meeting or isn’t able to attend! Seize opportunities to make yourself be useful. Don’t wait for people to tell you what to do. Don’t be a monkey! Be a problem-solving, creative human being.

Tip #4: Understand the culture and play the game.

During the start of my internship in graduate school, the recruiting manager talked about how this was the first time they were putting together a formalized internship program. She had conceived of the idea herself and was very proud of how the company had rallied around her idea.

At the end of the summer, the recruiting manager asked for feedback. A fellow intern, I’ll call him Larry, proceeded to give her very detailed, very critical feedback on how the program could be improved. Everything he said was warranted, but foolhardy. Larry didn’t know how to play the game. As he continued his critique, I could see the recruiter manager hang her head solemnly. She looked very upset.

After the room had cleared out, I went up to the recruiting manager and said, “I just want to say that I’ve never been a part of an internship program before and you did such an amazing job. It was extremely well-organized. I especially liked how you balanced the technical seminars with the networking events. I’m looking forward to applying all the knowledge I’ve learned this summer when I hopefully work here full time. And I owe that all to you. So thank you so much. I know it will make the transition that much easier.” She thanked me for those words and told me how much they meant to her.

I understood the culture. I mean, this wasn’t investment banking or management consulting. Sure the recruiting manager was looking for feedback, but you’ve got to read the situation and people properly. I couldn’t have picked a more opportune time to make someone feel good about herself and the work that she did. She was going to tell the hiring manager that she loved me and I knew that it was only a matter of time before I received an offer. Even though Larry was a rockstar intern, he was denied an offer. I’m sure the recruiting manager had something to do with that!

Money Monday: Retiring in the San Francisco Bay Area

My friend Affinity chided me for looking outside of the Bay Area and away from family, when I can very well retire here at home. She was totally right. She wrote a guest blog post on retiring early here. It was one of my most highly-trafficked posts.

I spent some time on Zillow and found the following places. There are some serious deals to be had.

$250,000 – 3 bedroom, 2 bath home in Vallejo, CA – 30 minutes to wine country,  40 minutes to SF by car

It’s like a cheap version of Falcon Crest or Dallas, right? Clearly a little dated, but definitely has character. A retired couple like me and Dean have no need for 3 bedrooms, but just wanted to showcase the breadth of what’s available.

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$169,000 – 2 bedroom, 2 bath condo in Hayward, CA – 1 hour to wine country,  30 minutes to SF by car

This is perfect! 1 bathroom for me, 1 bathroom for Dean. 1 bedroom for me, 1 bedroom for Dean. Haha! This place is a score at the price. I might have to buy it now. Rent this place out and have it completely paid for by the time we retire. Who I am kidding? We can write a check for the list price, forego the mortgage, save 4% on interest, and rent to college students since Cal State Hayward is across the street! I’m seriously going to ponder this investment.

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$155,000 – 2 bedroom, 1.5 bath home in Concord, CA – 45 minutes to wine country,  35 minutes to SF by car

This price is a steal. I am tasting retirement! 55 here we come.

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