It's OK to be a housewife. Be a good one!

The role of housewife has been denigrated in recent years. But there is nothing wrong or shameful about running a home, provided you do it well.

Since the 1970's the role of housewife has been denigrated as regressive or sexist. Women wanted to be liberated and have an equal place in society. And yes, back then, things were pretty horrible for women. One can understand why women wanted to get out of the home and live on an equal footing with men.

The plight of women over the years has eased somewhat. If you look back at how things were, you'd be amazed we let things stay the way they were for so long. Women only got the right to vote and own property in their own name only fairly recently. For most of the history of our country, women were treated little better than they are today under the Taliban. Women were chattel or property, their rights (if they existed at all) secondary to those of men.

It is a shameful part of our nation's history, and one we talk little about.

Today, we have come a long way. Women still make less on average than men, but that gap closes every year. More and more women are entering the professions, and barriers to advancement are falling, for the most part. We have a long way to go, but we have come a long way.

Women have not only made inroads into the legal and medical professions, but in some instances are starting to dominate them. More women than men are graduating from law school and medical school in some areas of the country. When I was a kid, people used to think having a "one of those lady doctors" was something to remark about. Seriously.

But a surprising number of women are still housewives, although many might not characterize themselves at that. In many suburban neighborhoods, many women still stay at home and mind the children. But the stigma of "housewife" today is such that many women do not want to label themselves as such, which is a shame. Managing a home is an important job for anyone, and no one should feel embarrassed or ashamed of taking on an important job.

And while the number is still fairly small, an increasing number of men are finding themselves in the position of househusband. For men, this can be an awkward role. But freed of the expectations of a liberated gender, many attack it with vigor and bring great profit to the enterprise.

A housewife or househusband can be one of the most effective jobs for managing money in a household. Unfortunately, the stigma we now attach to this job - and it is a job - prevents many women (and men) from effectively fulfilling themselves in this role.

And this is a shame, too. Because traditionally, having someone manage a household is an effective way to save money and make money. And yet many women, afraid of being labeled as regressive, or having to wear the label "housewife" will shun the role and its duties, thus adding to the expense of a household. And not surprisingly, these "bored housewives" end up being depressed as a result, as they don't feel they have a purpose in life.

For any human being, not having something to do is the worst thing. It starves the brain and causes depression. Winning the lottery, being spoiled, being unemployed, underemployed, or "kept" is never fun, as you tend to feel worthless. Hard work, on the other hand, leads to a sense of self-esteem that is profound and deep.

Many suburban housewives fall into this trap. They sleep until 10 or 11 in the morning, perhaps barely getting up for a half hour to see the husband or children off. They watch a lot of television, and eat, getting fat and adding to the sense of low-self-esteem. They hire a maid to clean the house, increasing the costs to the household and further adding to the feeling of worthlessness. Many of the household chores are foisted off on the working husband, under the rubric of "gender equality" - as if it makes sense for a spouse working 40-60 hours a week to also have to clean the toilets, so the other spouse has time to watch "Oprah".

And then, oddly enough, these housewives complain they have no "time" to get things done!

Now again, these comments can apply to a "house spouse" of either gender. And perhaps, the term "house manager" is more contemporary and gender-neutral. A good house-manger can effectively DOUBLE the family disposable income by SAVING money for the family and IMPROVING the quality of life.

As I noted in my Disposable Income posting, a family making $100,000 a year may really have only $10,000 in real disposable income. So if you can save a measly 10% in expenses over the year, you can effectively DOUBLE your disposable income. In other words, save 10% and you can be twice as rich as you are.

How is this to be done? Well, for starters, turn off "Oprah" and all that daytime TV, get off the couch, and get to work. Look at house management as a job. And yes, many of the aspects of the job are "menial" and difficult labor. But it makes no sense to pay an illegal alien $100 a week to clean your house, and then sit around and get fat. For what you are paying Consuela to clean the toilets for you, you could fund your children's college accounts or buy a new car.

Yes, I know that sounds harsh, but there you have it.

Being a house manager comprises a number of different jobs. Yes, there is the cooking, cleaning, shopping and other "menial" chores. But for many people, these can be creative outlets as well. Cooking is an art, and yet I meet so many people who claim they can't cook or have no talent for it. Well, take that 4.6 hours a day you are watching TeeVee (the national average) and put it to better use - take a cooking class, read a cookbook, experiment in the kitchen.

Shopping is another area where great cost savings can occur if you put your mind to it. I was in BJ's wholesale the other day, and two very overweight and undereducated women were ahead of me wandering around the store, dragging various items off the shelf and tossing them in their carts. They did not bother to check prices, read labels, or think about what they were doing. As one of them said to the other, "Heck, hon, he'll just have to pay for whatever I buy!.

At first I wanted to laugh at this trailer-park mentality, but then it hit me how sad a comment that was. To this woman, a husband was just some mule to be ridden into the ground, and their relationship was basically a race to the bottom, with each party trying to get the most out of it. A divorce is no doubt in their future.

If you read labels, compare prices, and shop effectively, it is not hard to save 10, 20, or 30% or more on food items and also have a healthier diet. But it does take effort, cooperation, time and energy. But any job worth doing is worth doing well.

But aside from the day-to-day chores of managing a house, there are other financial goals a house manager can perform. Managing money is one of them. In many relationships, I see situations where each spouse manages their own money - each has their own accounts and own checkbooks - even married couples! In others, the husband "manages" the money, giving the wife an allowance (how retrograde). Unfortunately, the husband's "managing" of the money usually amounts to his cashing his paycheck at a bar.

If one spouse has to work at an outside job 40-60 hours a week, chances are they have little time to think about and manage money. As I have noted time and time again, bank balances and credit card balances should be checked daily. Yes, daily. And logging ALL of your spending is essential to knowing where the money is going.

If you are a "bored housewife" think about taking charge of family finances. Pay the bills, manage the funds, and take charge. Figure out a budget and figure out ways to save. It beats sitting on the sofa watching the latest Oprah weep-fest. If your husband is not willing to at least share this chore with you, ask yourself why. Money and investing should be a joint, mutual endeavor.

There are many other areas where effective home management can save a family thousands and thousands of dollars a year. You are limited only by your imagination. There is no reason the role of "housewife" should be looked down upon or ridiculed. Like any other job, it can be whatever you want to make of it.

Winners and Losers

Should we laud winners and castigate losers?  How about neither?

In any economic system there are winners and losers. Even in Communist countries, there are winners (usually government officials, who live the high life) and losers (everyone else).

The great thing about America and most Western Democracies is that you do have some choice, to some extent, as to how much of a winner, and in particular, how much of a loser, you want to be.

I used to have more sympathy for people who fell for poverty scams, such as title pawn loans, payday loans, rent-to-own furniture, and crooked used-car dealers.

But lately, my sympathy has dropped off a bit. These sort of folks are often willingly selling themselves into economic slavery so that they can literally have shiny trinkets, such as a used car, a wall-screen TV, or bling-rims.

The people who run the sort of businesses that exploit the poor and human weaknesses will argue that they are winners, and they are entitled to profit off the misery of the poor. I strongly disagree with this proposition, of course.

While it may be technically legal (in some jurisdictions) to loan money at 300% interest (as payday loan places do), it certainly is not ethical or Christian. And while some may decry the rapid increase in the number of businesses that exploit the poor as an example of declining social values, if you read your history, you will note that such tactics and businesses have always existed (See, e.g., Look Homeward Angel, by Thomas Wolfe).

Our new administration is pushing through a Consumer Credit Protection agency and it seems like a good idea. Various scams and cons aimed at the poor now have to more clearly disclose what utter rip-offs they are. The "free credit report" places that advertise heavily have to disclose that in fact, they are not free, and are utterly a rip-off.

Will this help? Maybe a little bit. History shows, however, that such regulations can be readily skirted. The invention brokers were required to list their "success rate" online. The idea was, once someone saw that their success rate was 0.00001% over the decades, no one would send them money any more.

While this information may have deterred a few people from squandering their cash, my experience with "true believers" is that they are ripe for the plucking, and the invention broker with the boiler-room phone bank and persuasive telemarketer will win out in most cases. Over a decade after these new regulations have been enacted, the Invention Brokers are still in business.

So what can the average person do? Be vigilant. Be smart. Be proactive.

Here are some tips:

1. Never, ever go into debt for status things: Whether it is a car, a boat, a stereo, shiny bling rims, or other junk, don't borrow money to do it. You want that crap? Save up for it. By the time you put all the money together for the 50,000 watt boom-boom stereo of your dreams, chances are, you'll decide that there are better things to do with it. That is exactly why Credit Cards are so dangerous - you can have now and pay later. By the time you pay off the credit card, the consumer item is broken, destroyed, or sold, and you have paid 2-3 times for it - and realized you didn't need it. Save debt for important things like education or a home. 

2. Stop being a "Believer": Con artists use belief to get you to hand over their money. They get you to believe that gold is a good investment, or that your invention will make you a millionaire, or that you can day-trade stocks, or that you don't have to pay income taxes, or whatever. All of these scams and cons are based on selling a set of beliefs, not on logical analysis. If they can get you to check your critical thinking at the door, they have you. And by the way, this also means at the door of the church. Churches are often victims of con artists (or are con artists themselves), as they can fleece a flock and get away with it for years, because the parishioners are true believers. Even in religion, perhaps especially in religion, it pays to be skeptical. 

3. Stop believing what you want to hear: The payday loan places say you can have money NOW and be happy. Sounds good, right? But of course, it only means you will be unhappy later on. They tell you what you want to hear - that you can get something for nothing, or buy now, pay later. It is all so enticing, but a little voice in the back of your head is no doubt saying "Life just isn't that easy!" Con artists use this trick all the time - getting people to think that wealth can be created from nothing, with no work on anyone's part. If it sounds too good to be true, it probably is. 

4. Stop reacting to FEAR: The free credit report people are fear mongers. Unless you pay them $30 a month to "monitor your credit score" an "identity thief" will steal your identity and force you into bankruptcy. Of course, this is not true. The credit card companies report ordinary credit card fraud as "identity theft" these days, jacking up the numbers. You have little at risk from someone stealing your credit card data. You don't owe that money! Fox News is probably the largest example of fear mongering, using their dire predictions to get people to buy gold and also to protest against a health care plan than likely benefit the lower classes the most. Fear SELLS, period. Don't be baited by it.

Like I said, I have less and less sympathy for the folks who let themselves be baited this way.

Pssst! Want to get in on a risk-free investment?

Pssst!  Want to get in on a risk-free investment?

 Yea, you. No, don't look around. This is just between you and me. Come over here, I've got a great deal for you. Totally risk free investment! Yea, the rate of return ain't great, only about 5% or so. And chances are you're already invested in it. Sound like a con? No it ain't. It's real simple...

....pay off your mortgage.

Oh, wait, you say, that's bad investment advice! All the investment gurus say that you should have as much mortgage debt as possible, and invest all your money in your 401(k)! After all, that's tax deductible, and mortgage interest is as well! Paying off your mortgage? That's old school - what Grandma and Grandpa did.

Yea, but Grandma and Grandpa did OK, didn't they?

Let's take these objections one at a time, and maybe you'll see why paying down debt is your best first investment.

1. Stop Dancing to the Government's Tune: Yes, there are tax incentives to investing in your 401(k) and tax dis-incentives to paying off your mortgage. Maybe the Government didn't intend it this way, but many people believe (wrongly) that it is a good idea to have mortgage debt, as you can deduct mortgage interest.

This misconception occurs because of well-meaning advice from accountants. For example, a friend of mine was making $100,000 a year and renting an apartment. His accountant, doing his taxes, noted that for the $2000 a month he was spending on rent, he could afford to buy a house AND deduct the interest on his taxes, effectively lowering his tax bill.

That's sound advice - if you are renting, and you can afford to buy a home, and homes are reasonably priced and not going through some stupid bubble, and you plan on staying in one place for a while (5-10 years), then buying a home can be a good tax strategy.

Unfortunately, people too this advice the wrong way. They assumed (wrongly) that if a small tax deduction on mortgage interest was good, then a larger one was even better. So they bought more and more house, until they reached the point of mortgage stress, where they could barely afford the payments, and moreover, never realistically pay off the debt.

Tax incentives are just that - incentives. And while you should take advantage of them, you should not let them control your life. You can get a tax credit for buying an electric car. Does this mean you should buy an electric car? If you don't need one, no.

Similarly, in the recent past, there were tax incentives to buying huge diesel-powered SUVs, as you could get a tax credit for buying a diesel vehicle, then depreciate it as a business expense. As a result, some folks ended up driving 6,000 lb. diesel trucks to work as their commuting vehicles, convinced they were "saving money" because of the tax incentives.

Then diesel fuel went up to $5 a gallon, and no one wanted SUVs. Would have been better off with a minivan, it turns out.

2. A 401(k) is a better investment because of the tax deduction: The tax deduction for the 401(k) is a great incentive and you should take advantage of it - up to a point. Where that point is, depends on your income and economic position in life. Since most 401(k) accounts are structured to invest in mutual funds, and most mutual funds are structured to invest in risky, high-rate-of-return stock investments, your investment in your 401(k) is hardly safe, as many of us found out over the last year (although it has bounced back nicely, hasn't it?).

Yes, it is possible to move your 401(k) into more safe investments, like a bond fund or something. But even bonds default, and the rate of return these days is paltry - a percent or two, at best. So it doesn't amount to a very good investment, in terms of safety or rate of return.

And the tax advantages might not be as great as originally touted. While you pay no tax on money invested in your 401(k), bear in mind that you will pay taxes when you take it out, albeit probably at a lower rate. And of course, you get to invest that tax money for the time period before retirement. But you will pay taxes, to some extent. You are not getting a totally free ride.

This is not to say you should not participate in your 401(k) or IRA.  Don't be an extremist.  Only to say that in terms of "safe harbors" paid-off debt is the safest there is, and as you get older, more and more of your "investments" should be in safe harbors.  Having a plan to get debt-free is important.  Perpetual debt is just not an option, nor is it desirable.

3. Housing Prices Fluctuate - it is hardly a "safe" investment! Right? Wrong! If this was true, then don't buy a house, period. Yes, during the last decade, prices shot up, then plummeted. People who invested for the short term, hoping to make a killing, got killed themselves. People who bought homes without doing research ended up bankrupt.

But chances are, if you bought your house more than five years ago, it is still worth what you paid for it, unless you live in Las Vegas or Fort Lauderdale. And if you bought your house more than ten years ago, chances are it is worth far more than you paid for it.

Housing prices will remain largely flat for the next decade. They will continue to drop for the next year, bottoming in 2011 or 2012 and then increase by 2-3% a year as in normal times. While the price of a home will drop, it will only drop so far. Unlike stocks, which can drop down to nothing, a home will always have some intrinsic value, if nothing more than as rental stock. There are rare exceptions to this rule, for example, in boom towns where people overbuild, and then abandon homes. But these sort of things occur only rarely. If you live near a major city in a good neighborhood, chances are, your home will always be worth something. (except if you live in Detroit or Flint, Michigan).

So if you pay off your mortgage, you end up owning something tangible and real. And then no one can take it away from you, unless you don't pay the property taxes. And if you need money, you can borrow against it, or sell it, cashing in on the investment aspect of it.

4. You Owe the Money Anyway: Even assuming housing prices fluctuate, you owe the money anyway. Unless you plan on abandoning your home and walking away from an upside down mortgage, you have to pay back this money someday, whether you like it or not. If you sell the house, the money from the proceeds pays off the mortgage, with the difference being paid back to you in cash.

If you have been paying off your mortgage, you will get a considerable amount of cash back, which means you have a down payment for a new house, if you have to move. But if you mortgage your house to the hilt, on the theory that "more debt is better", you may have trouble even paying off that debt, and walk away with nothing.

And with nothing to put down these days, chances are, you'll have trouble finding financing for a new home, as we are moving back to the era of 10% or even 20% down payments. So paying down that debt makes a lot of sense.

5. You already are investing in your House: With every monthly mortgage payment, you are paying down that debt already. It may be only a few hundred dollars a month ($500 in my case) but it increases by a small bit every month. Making even one extra mortgage payment per year can knock ten years off the term of a loan and tens of thousands of dollars in interest payments. This is a real savings, and it accelerates the payment of the loan, meaning each payment pays more off principle and less in interest.

In my case, making one extra mortgage payment a year means I am knocking $10,000 off the balance of the loan, instead of $6,000 or so. In a way, this is like investing $10,000 in a risk-free investment.

6. Guaranteed Rate of Return: Your mortgage rate may be anywhere from 5-7% or more. When you pay down your balance, you reduce your interest by that amount. In effect, you are getting a guaranteed rate of return almost equal to your mortgage interest rate.

I say "almost" as the calculations equating reducing debt interest to savings interest are not exact, and also there is that tax deduction you get from the government. But assuming you are in the 35% tax bracket, that means for a 6% mortgage rate, you are generating a net savings effect of 4%.

Go down to your local bank and ask them for a 4% CD. When they stop laughing, you'll understand why paying down debt is not such a bad idea right about now. Most banks are offering 1-2% if that, on savings.

7. Retirement with No Debt: Retiring with debt is a very bad idea. If you are struggling to make the mortgage payment now, imagine how it will pan out when your income drops to zero. For many recent retirees, it is too late. They lost their jobs in the recession, and were over-extended on their mortgages, and lost much of their 401(k) in the stock market crash. They end up losing their homes and in bankruptcy, a crappy way to begin what are supposed to be the "golden years".

If you own your home outright, chances are, you will be able to afford to live in it, even if you have to live on Social Security alone. Without the monthly drag on your finances, you won't be forced to move.

And when you do choose to move (or they put you in the home) you will have a tangible investment that can be liquidated to cover your living costs during those "Golden Years".

8. Safe Investments as a Function of Age: One GOOD piece of advice many investment gurus give is to use your age as a percentage of your safe investments. Thus, at age 50, you should have half your investments in "safe" accounts, like government bonds. Real Estate, when not overheated in price, can be one of those safe investments. At my age (50) about half my portfolio is in a relatively safe investment, a paid-for house that I have had for five years. Even though the market has fluctuated, the house is still worth more than I paid for it.

At the present time, I am accelerating my payment on my mortgage on my other home. By the time I retire (age 65) both homes will be paid for, and most of my portfolio will be in "safe" investments.

Yes, I am still investing in my 401(k) plan, but paying down debt is also a form of "investment" that pays a steady dividend, in terms of reduced interest payments.

Everyone's ultimate goal should be to be debt-free. If you find yourself taking on more and more debt because you think that is sound financial advice, think again carefully about what real wealth really is. Owing money to people is not wealth, only debt.

* * *

Paying down debt is a safe "investment" and something you have to do anyway.  Saving money while taking on new debts is something that really makes no sense.   Spend less, learn to live with less, borrow less, and pay down debts, and over time, you will accumulate wealth.

Sadly, most Americans - myself included - tended to look at finances in terms of how much more debt they could qualify for.  A raise at work was not viewed as money to be banked or used to pay off debts, but money that would qualify them for even more debt.

Maybe this trend is changing, but I am not so sure.  People's economic memories are not very long, and a core group of Americans never stopped believing in the almighty God of debt, even as their false God smote them in 2009.

UPDATED:  February 12, 2017

Should You Buy from Woot?

Woot! Sells one item a day, at "discount" prices.

NOTE: Shortly after I wrote this, Woot! was sold to Amazon.  Figures.  A decade later, I have yet to buy anything on Woot!  I suppose those beacons would have been good for my golf cart, or if I decided to start a snow-plow business.  Other than that, nothing.  See also, Woot! Revisited.

* * * 

I was online recently and came across the site Woot! which is an interesting internet retail site. Every day, they offer one item for sale, and then sell that item until they are sold out. The next day, they sell something else. It is an interesting retail model, to say the least. And apparently one that is pretty profitable as well.

Are these bargains? Maybe. The problem with the Woot! site is that if you become a fan of the site, you are going there to shop, not to make a purchase.

What's the difference? If you are making a purchase of an item, you carefully determine a need for the item, then shop around to compare prices and features, select the product you want, and them make a strategic purchase.

The Woot! site, like most "shopping" venues, (malls, shopping channels, SkyMall catalog, etc.) reverse the process. They offer a product, and then you decide you need it. The step of determining real need, comparison shopping of prices and features, and strategic buying are not collapsed, they are avoided. They present a product and you impulse buy it.

They are pretty up front about this, too, in a humorous way. Their purchase button says "I Want One!" which is sort of a nod to the impulse purchase aspect of their site. Their blog portion has some more examples of their humor as well, such as their "Holy Crap Commandments":

THE HOLY CRAP COMMANDMENTS v2.0: 

I. Thou shalt expect nothing beyond one bag of some kind and your chosen quantity of crappy items (which should be THREE). 

II. Thou shalt not whine and complain when some people's crap turns out to be nicer than yours.

III. Thou shalt take a moment to consider whether you might be better off just not buying this crap.

IV. Thou shalt not order just one crap and blame it on anything but your own inattention. 

V. To paraphrase Stephen Stills, shalt thou not get the crap you want, want the crap you get.

I have to hand it to them, at least they are up-front about compulsive shopping. Here's our crap, you wanna buy it? Great. Stop Whining if you don't like it.

This section, from their FAQ is even more up front:

Will I receive customer support like I'm used to?

No. Well, not really. If you buy something you don't end up liking or you have what marketing people call "buyer's remorse," sell it on eBay. It's likely you'll make money doing this and save everyone a hassle. If the item doesn't work, find out what you're doing wrong. Yes, we know you think the item is bad, but it's probably your fault. Google your problem, or come back to that product discussion in our community and ask other people if they know. Try to call the manufacturer and ask if they know. If you give up and must return it to us, then follow on to the next FAQ entry.

That is pretty funny! Honesty like this is hard to come by. Most of what they sell is what people euphemistically call "consumer electronics" and what I call junk. You know, some box of junk with a wall-pack transformer, a packet of silica desiccant, and a warranty card, along with an owner's manual that opens with "Congratulations on your purchase of our piece of junk! It is sure to change your life forever!"

Or, if the item was made in China, as they increasingly are, it will be printed on that slick melamine-laced paper in an odd narrow font, and say "Conglatulations Comrade! You buy junky product! Make much happy! Happy Happy!"

But that would be racist to say that.

But that is the problem with Woot! and consumer electronics in general. The promise of these "toys" is that they will change your life forever, and for the better. You will, from that day forward, look at your life as having two parts; the dull dark period before you purchased a Roomba on Woot! and the enlightened period afterwords, when the angels sang, the heavens opened up, and you finally managed to lose that extra 10 lbs.

But after unpacking countless consumer electronics over the years, tossing the warranty cards (just an invitation for spam and junk mail anyway) and unwrapping those wire ties on yet another wall-pack transformer, I can honestly say that 99% of this junk is just utter crap I could live without. And I'm an Electrical Engineer, too.

I used to buy junk like this from a catalog called Damark. Damark had some great deals, at times, and just junk at others. On the whole, I think I broke even. I bought some phones at Damark for half the cost at the local office supply store. I bought a phone system from them as well. A lot of other stuff was not up to snuff, or was clearly returned merchandise. But the main problem was, (and is) that by getting the catalog, I would end up "shopping" for things I didn't need, based on price, rather than on actual need.

So I would look at the catalog and think, "Gee, that robotic dog looks pretty cool, and only $59.95!" But of course, it was a returned robotic dog and the reason why it was returned was that it was a total POS.

OK, so I didn't buy a robotic dog (I am not THAT stupid) but you get the idea. You read these catalogs and suddenly think you can't live without the product, particularly at the low, low price mentioned. And before long you are buying more and more of this junk, overpaying for it and cluttering up your life and maxing out your credit card.

And I am not picking on DAMARK. Yes, they have some good bargains. They also have stuff you don't need or want. If you read the catalogs, you'll end up buying both.

The best thing to do is to avoid catalogs. I throw them away when I get them now. If you pick up a catalog, chances are, you'll read it and start to think about things you want to buy. Not reading the catalogs (or going on websites like Woot! or watching home shopping channels) is the best way to limit spending on unnecessary garbage.

So while I think Woot! is an interesting concept, I don't think I'll be logging on every day to check it out. The odds that they will have, on a particular day, some item I want or need, is slim. It is far more likely I would end up impulse-purchasing something I didn't need, and end up with more junk cluttering up my life.

Note: I checked a few "bargains" on Woot! over a two-week period, and was not impressed. For example, this laptop was selling for $499.95 plus $5 shipping. Not a bad price, but the local Staples, Wal-Mart and BJ's Wholesale have the same deal without paying for shipping. Plus, the unit is "re-manufactured" meaning it was defective or someone returned it, and God only knows if it will work for you, or whether it will outlast the 90-day warranty. A laptop for $500 is the norm these days, not some screaming bargain. A re-manufactured laptop should be at least $100 cheaper.

I suspect some of the other merchandise on Woot! is about the same in "value". But since you are not comparison shopping (just plain old shopping) you are not going to notice that the $99 GPS is really only an average price, instead of the screaming bargain they claim it is. The humorous stories on the site are funny, but they obscure the nature of the underlying bargain, or lack thereof.

So no, I won't be buying anything on Woot! anytime soon.

Selling More Things on eBay

It is fun to sell things on eBay, and profitable, too, if you know the ropes.

It is that time of year again. I decided to clean out a closet and found a bunch of things that I could not bear to throw away. So I sold them on eBay and made over $700. Actually, I made over $30,000, as I sold my boat on eBay this Spring. If you want something to go away in 7 days, put it on eBay with a no reserve price.

Now granted, when you factor in shipping costs, eBay costs, PayPal costs, and the hassle of packaging things, maybe you don't make a ton of money on this stuff. But $5 here, $10 there, maybe $20 somewhere else, it all adds up. Pretty soon, you are looking at putting a $500 dent in your credit card balance.

The resistance many people have to selling things on eBay, or at garage sales, is that they are convinced that their "stuff" is worth millions of dollars when in fact it may be worth a few dollars. If you have "stuff" and you aren't using it, get rid of it. Even if you find out later on you needed it, chances are, you can buy back the same or a similar thing from eBay.

In this way, eBay acts like a virtual storage closet or pawn shop or even equipment rental store. You turn in merchandise you don't need and get money for it. You get back in return other merchandise and pay money for it. The beauty of it, is that you don't have to keep things on the premise that "someday I might need that". Just sell it to someone on eBay and if you ever need it back, it will be there, for sale by someone else.

This time around I liquidated my coin collection. I am not a coin collector and got into it by buying mint proof sets. It was sort of fun, but since I did not have a place to display the coins, it quickly became boring. And let's fact it, looking at coins is boring. And once you start a collection, you have to keep going and going. I wanted to collect all the 50-state quarters. But that means buying the coins every year. Then, they start up with presidential dollars. What's next? It is effective marketing on their part, but I found I was getting less and less enjoyment from it. Better to sell the coins to someone else trying to complete their set and move on.

I also had a number of components from my old alarm system from my old house. Alarm systems are of little use in preventing real crime (as is owning a gun) and I never got around to installing the alarm in my new house. So after sitting for a few years in a closet, I sold the components on eBay. Surprisingly, there was a strong demand for these, as many folks with older alarm systems are looking for these components to keep their older systems working.

I had some old radios that I hated to throw out. Those are still listed, but I think one might sell.

I've learned a few more things about selling on eBay since last year. See my previous article for more advice about selling on eBay, particularly the frauds and cons to watch out for.

One thing I learned was to use the re-listing feature. Sometimes something doesn't sell because it is overpriced. Other times merely because the person who would have wanted the item just didn't see it during that 7-day window. You can re-list for free in many cases, or for a nominal fee. If you continually re-list an item, sometimes it sells. You can also adjust the price of an item downward, when you re-list and it may sell at the lower price.

In the past, if an item didn't sell, I tended to "give up" on the item, rather than re-list. Now I am more aggressive about re-listing, as it only takes a click or two, and it gets things sold.

We've also used eBay to but items we wanted and saw in stores. For example, we wanted a back massager, a $120 item in the store. I found a new one on eBay for $75, including shipping. By waiting a few days, we saved $45. Buying online is one way of avoiding the impulse purchase and also a good way of making sure you are price shopping.

The summer I plan on selling more items on eBay, including my antique tractor (which we bought on eBay five years ago). We are no longer mowing five acres of lawn, so we aren't using it. And if you aren't using it, why keep it around? It is as simple as that.