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Tuesday, November 30

Frugal Landlord Update

I know I shouldn't count my chickens before they hatch, but tomorrow I am supposed to sign leases for both my vacant houses. There is also a third property - the one I tried to sell - whose lease will become effective tomorrow. I'm so excited by the prospects of once again having all my properties rented.

Even better, the turnaround time and the rent I am charging are both impressive. On the townhouse, I am charging $650 per month which is $25 more than the last tenant paid. It was vacant for two weeks. I'm most happy about the minor amount of work I had to do to get it ready to rent. The carpet isn't new and has a few stains. It should probably be replaced. But my tenant didn't say anything about it. Same with the paint. It's acceptable but not a fresh coat.

The second property is my condo. The last tenants were there for 18 months and paid $575 per month. They are paid through November (today they are cleaning the carpets and turning over the keys). The new tenants will be paying $625 per month and are moving in Wednesday. Absolutely no down time at all on this property.

I'll be making $75 more per month on the two properties, and have spent less than $200 on repairs. This is perfect timing as I was worried about my cash flow for December.

Monday, November 29

A Week in the Life of a Mystery Shopper

November 21st - November 27th...

For the second week in a row I made very little from mystery shopping. I'm sure the holiday is to blame. Last week I earned $204 in fees and $46 in reimbursements.

I only shopped on 3 days and shopped just 8 stores: 7 gas stations and 1 payday loan store. Six of the shops were bonused: I shopped 1 gas station for $30, 2 for $26, 1 for $24 and 2 for $23. It worked out well that I had a slow week because I spent most of my free time getting the townhouse ready to rent.

This week I have another property becoming vacant. This is the first time I can remember having two vacancies at once. It would have been three but fortunately I have new tenants moving in to the house I had been trying to sell. This is also my most expensive property so getting it rented is a big relief. Even better: the tenants signed a lease purchase option and the term is 29 months. The tenants can purchase the house at any time in the next 29 months (which is what I really want) but even if they don't buy the house, they are locked into a long term lease, meaning I don't have to shop the property out again for at least that long.

Wednesday, November 24

Cutting the Electric Bill - 6 Month Goal Results

It's hard to believe it's been almost six months since I set a goal to reduce my electricity usage by 20%. Technically, it's been a little less than 6 months but my goal was over 6 billing cycles, which is over now.

It was a HOT summer, and I didn't do well at all for the first four months. It wasn't from lack of trying: I set the thermostat to 81 degrees when I was home, and it was completely turned off during the daytime. I also made an effort to zap vampire energy by unplugging things like my TV when they weren't being used.

Here's how I did:

June 2009: 288 kWh
June 2010: 396
Difference: +108

July 2009: 431
July 2010: 428
Difference: -3

August 2009: 314
August 2010: 582
Difference: +268 (ouch!)

September 2009: 290
September 2010: 448
Difference: +158

October 2009: 264
October 2010: 203
Difference: -61

November 2009: 189
November 2010: 187
Difference: -2

6 months of 2009: 1,776 kWh used
6 months of 2010: 2,244 kWh used
Difference: +468 kWh ( over 26% increase)

My goal was to reduce usage by 20%. Instead it increased by 26%. That's horrible. What happened? Two things: According to Science Daily, 2010 was the fourth hottest summer on record. Second, in 2009 I worked full-time either in an office or on the road. In 2010, I was at home much more. When I wasn't out myestery shopping I was at home writing reports and looking for work.

I'm going to continue my goal of reducing usage by 20% each month. Even though these last 6 months were discouraging, I know it helps keep me focused if I have a goal in mind.

Tuesday, November 23

Cutting the Electric Bill - November Bill

Back in June I set a goal to reduce my electricity usage 20% over the next 6 months.

In November 2009 I used 189 kWh of electricity over 28 days, which is 6.75 kWh per day. In November of this year, I used 187 kWh over 30 days, which is 6.23 kWh per day. I reduced consumption by just 2 kWh, but my bill covered two extra days this year.

This is the second month since June where I reduced electricity usage. I can attribute this solidly to the fact that I had a goal in mind. I haven't used my heat yet, even though there have been a few cold nights already. If I did not have a goal to achieve, I would have used the heat earlier this month. The low for the past several nights has been in the lower 40s, but no heat for me. Instead, I have an electric blanket, an afghan, and have been wearing extra layers of clothes.

My total bill for November was $34.55.

This marks the end of my six month mini-goal. Tomorrow I will go over the results and set a new one.

Monday, November 22

A Week in the Life of a Mystery Shopper

November 14th - November 20th...

Last week was slow. I earned $238 in fees and $256 in reimbursements. Monday was the only full day - I did 13 gas stations, 2 doughnut shops and a truck shop. The rest of the week I did a smattering of restaurants, business verifications and retail stores. Saturday I checked into a hotel shop.

Mystery shopping companies rush to fill all their shops before Thanksgiving each year, so this week will probably be incredibly slow. It works out really well though as I will be rehabbing one of the two vacant rental properties. The second property won't be vacant until Sunday but I don't expect to have much work to do before it can be rented again. I'm also still working on starting the new business. Progress on that is dreadfully slow but we are moving in the right direction.

Tuesday, November 16

It should be an interesting week

This week my business partner and I have committed to finding a location for our new business. On the one hand, I wish I had more mystery shopping lined up. Knowing those checks are coming adds some security to my finances. On the other hand, I can't lose focus of the big picture. Going into business for myself should be much more rewarding than working for (or through) others.

I completed most of the mystery shops I had for this week yesterday. Yup, in one day I shopped 16 sites. I have two assignments for today, a couple restaurants tomorrow and a hotel this weekend. Unless I find some opportunities for decent money, my plan is to focus on our new business.

Things may be quiet around here this week...

Monday, November 15

A Week in the Life of a Mystery Shopper

November 7th - November 13th...

Another decent week. Last week I earned $510 in fees and $223 in reimbursements. Nearly all of that came from 5 days (Monday - Friday). It was a plain Jane week so no need to go into much detail. I shopped mostly gas stations but also a few restaurants and a handful of other retailers.

On Saturday I checked into my first Freeman Group hotel. Freeman Group is notorious for late, late payments (like taking 6+ months to pay their shoppers in some cases). Because of this I've always avoided them. Recently, their new CEO sent out an email promising they would no longer tolerate such inexcusable practices. Late paying (small) companies are generally the result of one of two things: 1) a free spending executive or 2) an addicted one. Let's hope that someone either was removed from the checking account or went through a successful rehab program.

I'll be sure to note whether I am paid promptly by Freeman. It looks like they shop a major working-class hotel group. Will be nice to add them to my repertoire if everything works out.

Friday, November 12

Just When Things Were Getting Better...

My new tenants at the house I tried to sell are moving in December 1st. That's the good news, particularly since this is my most expensive property.

Alas, the good news stops there. I just found out I am losing two tenants this month. Even worse, one of the two has told me she won't be able to pay the already late November rent.

The first loss was somewhat expected as the tenants told me 6 months ago they wanted something bigger. At first I was going to work with them to buy another property, but when my other house didn't sell, the funds I expected to have for a new property never came.

The second loss is both unexpected and unfortunate. On the one hand, this tenant has had problems paying me on time for the last year, so I've even considered terminating her lease on my own. On the other hand, she is a low maintenance tenant, which is why I worked with her on her financial issues. Besides having to replace the air conditioner recently (which probably makes up for everything else when I think about it), I haven't had to spend any money maintaining this house in the two years she has been my tenant.

Of course, with this second property I will most likely have some deferred maintenance issues to deal with. While it's nice to not hear from a tenant for two years about problems, that also means there's probably some things inside that have to be fixed.

I suppose I should revisit my financial goals for November. The next few months are going to be a challenge.

Thursday, November 11

November Goals

It's difficult to set goals when you aren't sure of what to measure. My business partner and I expect to have the funds in place this month to start our own business. I don't want to overburden myself with mystery shops since 100% of my focus will be on this business after we receive funding from our investor.

Despite the difficulty, if I fail to plan, I plan to fail. Let's see if I can meet these three objectives:

November Goals:
  • earn $1,500 from mystery shopping (last month I earned $2,017)
  • reduce credit card debt and car loan to $36,500 (9/30/2010: $37,779)
  • pay 2 of my 8 property tax bills
That last goal alludes to the obligation I am most worried about right now. By the end of December I have to pay almost $9,000 in property taxes. Last year I ended up putting the taxes on a credit card - bad move but there was a lot of uncertainty then with my recent job loss and I was trying to close on the purchase of my last rental property.

Wednesday, November 10

Reviewing My October Goals

Finally a month to be proud of! In October I managed to achieve all three of my goals.

October Goals:
  • I earned $2,017 from mystery shopping (my goal was $2,000)
  • My credit card/loanbalance decreased, to $37,779 (my goal was $38,500)
  • I completed my dejunking goal by removing 30 items of clutter from my house.
Setting goals works - on October 31st I was short of my Mystery Shopping goal. Even though I felt like being lazy (hey, it was a Sunday!), I got off my behind and did enough work to beat this goal.

Tuesday, November 9

My Frugal Miser - October Expenses: $2,801

In addition to being a great month for income, I managed to keep my expenses low in October as well.

October Expenses

$490 Auto ($100 cash to a driver I bumped into, $103 for fuel, $272 Depreciation, $15 for service)
$14 Clothing
$111 Food (both groceries and eating out)
$44 Entertainment (movies, gambling, alcohol)
$13 Gifts Given
$11 Household (supplies, etc.)
$107 Health Insurance
$0 Medical
$274 Interest on Debt (not including Mortgage Interest)
$0 Miscellaneous
$433 Mortgage Interest (primary residence)
$816 Mortgage Interest (rental properties)
$0 Personal Care
$0 Taxes
$216 Utilities
$271 Vacation

Total October Expenses : $2,801


  • Due to poor planning I spent more on fuel than I had to. My gas station shops are scheduled out - by me - over time and I miscalculated when I would need gas.
  • I gave $100 to someone who's car I bumped into. Since he was in front of me, it was automatically my fault, even though he did something totally illogical and then blamed it on "that's the way we do it in my country." I started to explain to him the laws of the road in the United States but figured it was faster and cheaper to give him some cash for the inconvenience.
  • The vacation expense is from the Miami trip.
  • I separate my mortgage interest by personal residence versus rental properties. I think this is an important distinction: the personal residence interest is an expense I should exercise control over moving forward when looking at ways to be frugal; the other is an expense that generates income.
  • Spending on food was lower than my $5 daily goal at just $3.60 per day.

Monday, November 8

A Week in the Life of a Mystery Shopper

October 31st - November 6th...

Wow - it was a great week. Even better, I didn't do a single shop last weekend - by choice. I rarely take a day off but I was feeling like I needed a little "me" time. This flexibility to decide when you want to work is another great benefit of being a full-time mystery shopper.

Even with the shortened week, I earned $728 in fees and $246 in reimbursements. Full disclosure: part of my earnings came from my periodic merchandising route, which is what I consider to be mystery shopping's red headed stepsister. It has its ups and downs.

My mystery shopping adventures took me through a number of scenarios. I shopped two grocery stores, earning $24 in fees and $20 worth of free groceries - and, no narrative to report! I ate more boneless chicken wings than I care to admit, and I dined on grilled tilapia via a route of three highly bonused seafood restaurants.

I visited gas stations. Lots of them. My garage smells like fuel. It's to the point that my dreams are about dirty rugs and dusty ventilation fans in a restroom that smells like death. I can't buy gas anymore without checking to see if there are paper towels stuck in their holder at the pump, even when I'm not on a shop.

I did several other shops, including a gourmet chocolate store at the mall, three clothing stores, a copy store, business verification at a mortgage company, cookie store audit, internet car inquiry, and two telephone bank shops.

This week? Busy, but probably not like last week. I have to do at least 22 gas stations, one grocery store, a few restaurants and a merchandising job.

Friday, November 5

My Frugal Miser - October Income: $7,942

October was a solid month. I found a young couple who signed a lease purchase option on the house I was selling. They are moving December 1 but in October they made the first of 3 small non-refundable deposits. I like lease purchase options because the tenants take better care of the property and, hopefully, will make an offer to buy the house in the next couple of years. I also received the forfeited earnest money check from the original buyer who could not line up financing.

October Income
$1,039 Mystery Shopping*
$5,597 Rental Income
$1,307 Other Sources
$7,942 Total Income for October
*note that mystery shopping income will always vary from the monthly summary amounts I post. Here I report actual payments received (cash basis accounting) whereas in my monthly mystery shopping update I report the amount I earned for that month.


  • I offset Shopping income with Shopping expenses. In October, I did quite a few shops that will be paid in November. Thus, this amount is artificially low.
  • One of my tenants paid their November rent early.
  • The category "Other Sources" includes non-recurring (or semi-recurring) income since I always seem to have a little something that doesn't fall into the other buckets.

Thursday, November 4

Vehicles and the True Cost of Ownership: How Much is My Car Really Costing Me?

As a mystery shopper I have to be aware of my costs. Depreciation is the cost of using my car in a given time period. Instead of expressing the cost of my car as a one-time expense when I bought it, I spread out the cost of my car over its expected life. Depreciation does not include other vehicle-related costs like gas, maintenance or insurance. I separate those out and report them as they occur.

I determined that each mile I drive costs me $.0867 in depreciation. I ended September with 38,531 and at the end of October there were 41,669 miles on the odometer. I drove 3,138 miles. For October, my vehicle depreciation expense was $272.06.

Wednesday, November 3

A Week in the Life of a Mystery Shopper

October 24th - October 30th...

I had a great week last week. I earned $665 in fees and $205 in reimbursements. Most of my earnings came from two sources. First, I completed several gas station audits. Second, I completed a route of 10 fast food reward shops that were heavily bonused. I also did quite a few retail shops.

This week begins an easy round of gas station shops. I am signed up to do 50 in November - that's $300 in fees and $250 in free gas.

Tuesday, November 2

Starting a Business - How a Frugal Miser Does It

Last week my business partner Chris and I had a conversation. He is concerned about my Type A personality and how it will affect our business. That got me thinking about a lot of things.

There's a time to frugal, and a time not to be.

In my personal life, I go out of my way to keep my expenses low, low, low. I mean, how many people do you know that unplug their refrigerator and freezer when they go out of town to save electricity? In business, there are some costs that can be minimized and others that can't.
  1. If the expense doesn't contribute to our core focus, it can be cut. For example, I have to figure out how we will be doing payroll. I plan to choose the absolute best value package. That doesn't necessarily mean the cheapest package. What it does mean is I'll be driving the Chevy, not the Cadillac.
  2. For costs that can help us increase our revenues, I'll make the necessary investment. For example, happy employees will treat customers better. I'm not looking to cut costs by treating my employees like they can be replaced at any time. I plan to pay my employees a fair wage, and incentivize them with spot bonuses when they do a great job, and quarterly bonuses when the company does well, among other things.
  3. Another cost I'm not looking to cut is quality. Our product will be the best it can be - no shortcuts.
So how does a frugal miser cut costs? I have several ideas. We will turn the thermostat completely off when we leave every day. No reason to heat or cool an empty space. Also, we will be very selective about advertising. Often times I wonder just how effective some mediums of advertising can be. I imagine ambulance-chasing lawyers do well by advertising during daytime courtroom dramas. The tort-heavy/trigger happy demographic they seek is the audience that is at home during the daytime watching TV while everyone else is out working. But a dentist advertising on a highway billboard? Every time I drive by that ad I wonder how many new patients it takes to pay for it. Then I wonder why the dentist isn't getting new patients the way most dentists do: through referrals (which, as a side benefit, doesn't cost much more than the cost of treating your customers right to begin with).

Being a frugal miser means cutting out all the fat. You never slice into the muscle - that would hurt!

Monday, November 1

Clutter Roundup: Final Update

At the end of last month I set a goal to declutter my home. Specifically, I wanted to remove 30 of my possessions in October. Earlier in the month I reported that I had sold 10 items. I wanted to post my final progress report:

Yesterday I gathered up 20 things. Some of the 20 things are pictured to the left: a Josh Groban DVD (sold on - I sold one other DVD a few days ago), souvenir Coke bottles, coffee cups, an old iron, phone books, 2 pair of old shoes and a couple of heavy shirts. I also am selling a small desk that I've hated since the day I bought it. I learned a lesson about buying cheap furniture: what good is it if it's too uncomfortable to use?

It's a good thing my goal required me to do this by the end of the month or it wouldn't have happened! But, I'm really glad it did. I earned a total of $162.78 from the items I sold, and my spare bedroom has never looked more...spare.