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Tips for Buying A Digital Camera

January 11th, 2010 No comments

In this post I give you a very short primer on how to choose a digital camera.

I bought a digital camera in the past year, a Nikon D40. It’s been a while since I owned a camera, the last one was a film camera, plus numerous throw-away cameras. I can say that I got lucky, I bought a camera that in retrospect was a good choice based upon my own opinion and followup research. 

For research, I mainly read the excellent site  In an age of social websites, community generated content, video and everything Web 2.0, this site may seem like an antique from 1998. It is, but the content is excellent. There’s a lot there (really too much), so I have culled the most important information that will be useful to you as well as added some other good links. 

  1. 90% of getting a good photograph is being there when the opportunity arises and having a camera in your hand to take the photo. Buy a camera that you find easy to use and that matches your expectations in size and portability. A fancy camera that sits at home because its too bulky or hard to use isn’t going to get you good pictures. 
  2. Forget about Megapixels. Any camera you buy today will have many more Mexgapixels than you need. A 4MP camera (if you can even find one) is good enough to print quality 4X6 photos, a 6-10MP camera can print photos larger than what most people need. For more information on this, read Breaking the Myth of Megapixels, by David Pogue of the NYT.
  3. Digital cameras for amateurs come in (2) types: point/shoot, Single Lens Reflex (SLR).
  4. Point/Shoot cameras are excellent for landscapes, portraits, or images where the subject is otherwise not moving. There’s no reason to buy anything more expensive if you mostly shoot these kinds of photos. See the great images Ken Rockwell shot with a point/shoot camera.
  5. SLR cameras can shoot action shots and have the most upgradability. The downside to these cameras is that they are missing consumer friendly features such as great portability, filming video and being able to preview the picture live.  
  6. If you want a quick recommendation of some cameras to buy, read what David Pogue recommends. The best point/shoot camera he suggests is the same one that Ken Rockwell recommends
  7. Buy a camera (or in some cases, a lense, for SLRs) with a feature that helps to eliminate the blurring effects of camera shake, it really works. This feature will be called ‘Image Stabilization’ or ‘Vibration Reduction’. 
  8. To get a picture sized within your view, you either need to move or the camera can move using zoom. Buy a camera with some amount of optical zoom, the digital zoom that some cameras offer is inferior since it uses software instead of physically adjusting the lens. Some expensive point/shoot cameras have lots of zoom, but their price puts them in SLR territory which overall are superior cameras. These point/shoot cameras also lose their size advantage. 

It’s never been easier to take photographs with all the great digital cameras available. Happy shopping.

Categories: Lifestyle Tags: ,

Making the Transition to Online Payments, Part II

January 7th, 2010 No comments

In this second article, I discuss how to use bill payment services and some gotchas to look out for.

Before enrolling in a bill payment service, I hope that you first took advantage of the free lunch offered by your bank as discussed in Part I. Using the direct bank payment option is the best place to get started with online payments. 

Rocky Start for Bill Payment Services

Bill Payment is a service setup at your Bank or Credit Union where you authorize them to send your payments drawn from your checking account to third parties you specify. Once enabled, you define who you want to send payments, and then you can enter one-time or recurring transactions as needed. I started using bill payment services over 10 years ago at my Credit Union. The first service offering was not very good, they could only provide payments to a select list of well known large institutions. Since you couldn’t pay every bill with the service, this made the offering less convenient. I rarely used it.

The service offerings available today are complete, they can pay any kind of bill. How is this done? The key change that was made over the earlier systems was adding a default delivery method that is totally old school: snail mail checks. When you enter a payment to an institution that is not in the database, they will initially mail out a paper check drawn from your account. Behind the scenes, the administrator will then attempt to set up an electronic interface for subsequent payments. No action is required on your part, it all happens automatically.

Send a Check to Anyone

The next question you may ask is what if they never setup an electronic interface. No problem, they will continue to send out the check in the mail. I have used the service to send out checks to my mother, who I can say with certainty will not have an electronic interface in the future! The only requirement to set up a payment is a mailing address, it can be any institution or anyone (read your service limitations – my service has a few exceptions e.g., they won’t make payments to some government institutions).

Don’t worry about blowing your check writing limits, the bill payment service will typically offer its own check writing limits in addition to any limits you may have with your checking account.

It gets better. Competition for deposits is so intense at banks that you will likely be able to use the bill payment service at your Bank or Credit at no cost. Banks realize that Bill Payment services are very sticky – they require investment of time to setup – and once setup customers are less likely to move accounts to a competitor. There are some significant savings for you in postage and also time. The cost for postage is included in the service.

Funding Your Account

The account where you will pull cash out to make payments needs to be funded through your billing cycle (typically monthly). If I expect to pay bills of $300 each month, I try keep at least 2-3X this amount in the account to account for unexpected bills (e.g., a large heating bill during a month). You do want to try to limit the amount of cash in this account, since the checking/savings account will typically earn little to no interest.  

Setting Up Recurring Payments 

The first payments to setup are the easiest – recurring payments that are the same amount each billing cycle.  Setup small payments as recurring, because if you try to setup up your larger payments it is easier to be underfunded which may lead to a bounced check. If you always keep a buffer of some extra money in the account (as mentioned above), it will be less likely that you will not have the required funds. The folllowing types of bills are ones that are good candidates for recurring payments:

  • Credit minimum payments.
  • Cell phone bills.
  • Insurance Premiums.
  • Cable/Internet/Land Line bills.
  • Auto Loans.
  • Normalized Utility bills.

These should be clear, but a note about a few of these bills. Your credit card bill likely will not have the same charges every month. You can use the payment service to pay a minimum amount each month (regardless of the actual charges). This will protect you from fees due to a late payment (but not extra finance charges, of course). Also, your utility bills will likely vary every month but it should be possible to setup a fixed monthly payment plan for each if you take the time to call up each utility. This will then convert a variable monthly bill into a fixed bill – keep in mind that these still may require some adjustment if your usage varies from year to year. 

One Time Payments

All the rest of the payments are considered one time payments, you will need to enter these every time a payment is required. The following types of bills are ones that are good candidates for one time payments:

  • One time bills (an annual subscription, e.g.)
  • Mortgage/Equity Loans.
  • Large Auto Loan. 
  • Excess Credit Account Payments (in excess of minimum payment amount).

I verify that the money is available in the source account before entering these payments. Even though the  mortgage is a fixed payment typically, I choose to enter this one every month as a one time payment. It’s too important of a payment to get wrong, also, I want to be certain the funds are in the account when the payment is made.

Payment Timing

When you first setup a payee, make a payment far in advance of the due date. Verify that the payment was received in a reasonable amount of time by contacting the payee. Payments by check will take a week  (5 business days), while electronic payments will take (3) days or less.  If a payment is sent but is actually never cashed by the payee, the check will be cancelled after some time and the money will be returned to your account (my Credit Union cancels a check after 30 days). 

In the paper world, there was a lag between when you mailed the payment and when the money was actually removed from the source account. When using these services, keep in mind that this window has been reduced. Even for payments sent by check, the service pulls the money out of the account in as little as 2 days from when the transaction was initiated. Check you service provider for details.

A Word of Caution

After successfully setting up an electronic payment plan for my mortgage, the bank decided at some point to reject third party electronic payments (the payment came back with a rejected status). It took a couple of months to get a clear answer from the bank regarding the policy change, but in the meantime I switched back to sending a paper check. It’s a good idea to keep on top of your payments, particularly your ‘prime time’ bills that affect your credit most,  just in case any errors occur without warning. 

Keeping tabs is getting easier. The Bill Pay service sends me mail notifications at my choosing, including when a payment is sent. Also, I set up another email notification with my mortgage provider to notify me when a payment was received. Between these two notifications, I can determined relatively easily if a payment wasn’t made when I expect it to be made.

Making the Time Investment

Setting up your bill payment transactions will take time – you will likely want to verify the initial payment of every payee you setup (especially the most important payments, such as your mortgage). Don’t setup the service at multiple institutions, the best strategy is to pick the bank you know the best and currently do significant business with. Pick carefully, if you move to another bank you will have to go through the setup exercise again. Ask yourself, do you trust this bank? Are they easy to do business with? A good choice would be the bank where you currently have your payroll checks deposited or where you currently pay your bills with your checking account.

Categories: Personal Finance Tags:

Making the Transition to Online Payments, Part I

January 5th, 2010 No comments

There are many people out there who resist using online payment services. This could be for perceived security concerns, unfamiliarity or resistance to change, or the concern that the payment service will make costly, unforeseen errors.

I wouldn’t suggest anyone implement a service that made them uncomfortable. If you are on the fence, or have just never got around to starting with online payments read on.

In this series the following types of online payments will be discussed:

  • Direct Bank Payment, the first place to start.
  • Direct Bill Payments.
  • Bill Payment Service.

Direct Bank Payment

The banking institution where you have an account very likely will already offer some services within the institution that you can use once you activate your online banking account. Bill payment services are used to pay third party institutions that are separate from the bank where your account exists (e.g., your utility bills, student loans, etc). If you have existing loans or credit from the bank where you write your checks, use the existing online services from the bank to pay these bills. This is a ‘free lunch’, very likely once you setup your account online at the bank, these payment services can be used immediately.

The types of bills where this may apply:

  • Credit Cards.
  • Mortgages.
  • Auto Loans.
  • Home Equity Loans.

If you have any of these at your bank, you are better off using direct bank payment on the website. It is hard to make a mistake here; in order to make a payment you need to have the money in your account (you can verify this before the payment), and the payment will occur instantaneously (it’s hard to be late as long as you pay before the due date).

Direct Bill Payments

Direct bill payments are transactions you setup at each biller seperately where you authorize them to pull or push money from an account, typically a checking account or a credit card.

Payments can be typically setup to pull, where they will automatically bill your account with a recurring transaction, or push, where you will need to authorize each payment for each billing cycle.

If you set up a lot of these interfaces, it is easy to see the downsides:

  • You need to go to every website to initiate the payment, if you are pushing payments. This takes time.
  • If you authorize pull payments, you need to be on top of your account to make sure you have sufficient credit or cash level.
  • If your credit card or account changes, you need to update every party.
  • Verification of payments needs to occur at each party, again by contacting each one.

If you are starting out, I suggest that you don’t setup automatic pull payments. Even though I have been using these services for many years, I still don’t have any pull payments since I want to be in control. Also, I don’t feel comfortable giving third parties the ability to pull from my accounts because there can be potential mistakes that may be hard to track and fix.

In Part II, I discuss setting up and using a Bill Pay service.

Categories: Personal Finance Tags:

Automaker Success

January 4th, 2010 No comments

There has been a lot of press on the state of the Big Three automakers, before and after the Federal Government decided to offer load guarantees.  The press has not been shy about coming up with reasons why the automakers are in the predicament they are in. I can’t help but think that many of these journalists have never run a business.

An often mentioned theory, repeated too many times to count, is that the Big Three should have invested in and built more fuel efficient vehicles. This theory has made it to the committee hearings, where legislators want the loans guarantees to be met with requirements to invest in the new technology.

Sorry, but this isn’t the reason why the automakers are failing and it won’t be the salvation for them, at least in the short to medium term. They are failing because they don’t make a profit on the vehicles they sell today. It’s that simple. Currently, new technology vehicles powered by hybrid technology or natural gas still make up a very small percentage of vehicle sales today.  Toyota is the leader in this area, and they invested in this technology using the profits of vehicles based on the existing technology; yes, even from the gas guzzling trucks.



Categories: Lifestyle Tags:

Marginal Utility…or should you upgrade your Coke?

January 3rd, 2010 No comments

Economics theory can help to provide some assistance in our finances. No, this won’t be a post about some academic theory of no practical use, this phrase can help your finances a lot. Today, this post will cover the economic concept of Marginal Utility, which is simply the expected improvement of a product when we spend more to buy the ‘deluxe’ version versus the ‘basic’ version, or however the marketing team decided to differentiate the product versions. This will not be a post imploring you to never spend more to get upgrades. There are cases where you should. However, marketing has become so sophisticated with creative ways to get you to spend more for a product/service. In this post I provide some real examples where I faced the upgrade quandary. There are many cases where you can pay more and actually get no extra benefit at all, get a benefit without paying anything additional, as well as cases where an upgrade is necessary to get a functioning product. The following are examples of upgrading decisions that have occurred recently to me that I hope will help you to consider your choices carefully when shopping.

Upgrading A Hotel Room 

Reserving a hotel room has been made very easy with the various booking services that are online. I wouldn’t give up the convenience of online booking, but keep in mind that hotels are all about service, and with some persistence and planning you can often times get upgrades for free simply by asking (instead of just paying more through your online booking). I once upgraded a Caribbean hotel room to a water view simply by calling and asking the hotel ahead of time (I also provided a small gift when I arrived as thanks). The hotel room upgrade above was provided at no cost.

In a more recent example, I paid for an upgrade of a hotel room in Provincetown, MA that didn’t provide any extra benefit at all. I reserved the room online and unfortunately due to time constraints, I didn’t contact the hotel directly before I made the reservation. I purchased an upgrade that provided wireless internet access to the hotel room.  If I had simply called the hotel ahead of time, I would have found out that the wireless access was unsecure, no extra payment for the network access would have been required. 

Upgrading A Car

Automobile companies work very hard to tailor their products/marketing to entice new car buyers to buy upgrades. It makes sense, a new car buyer typically is looking for that experience that can only come with a new car – the new car smell, the shiny sheen of the paint, the knowledge that you are the first driver. These buyers are ripe for unnecessary upgrades. 

The easiest way to thwart the upgrade bug is to simply buy a used car. Buying a used car will force you to make decisions about what you actually need, since these vehicles can’t be upgraded on the lot.   

If you do decide to buy a new car, first answer the large questions about what you really need, such as:

  • How much passenger capacity is required.
  • How much utility is required to carry goods/large items/etc.
  • What special features are important to you – quietness, luxury, off road ability, special electronics, high mileage, etc.

Once you have determined what you need, stick to the list of vehicles/models on your short list. Resist the temptation to upgrade – take a hard look at what the benefits will be. Do you really need an engine with 50 extra horsepower? In most cases you really don’t.

Upgrading Your Beverage

In an Atlantic City, NJ restaurant recently, I was faced with a beverage decision – small or large? Unless I just came off the volleyball court, I don’t see why I or anyone else would need a beverage the size of a large – but something else had occurred to me that spawned the thought for this tip. This upgrade tip may seem trivial and not worth mentioning, but it is nonetheless a very clear example of an unnecessary upgrade.

In the past most restaurants would pour fountain drinks for you. Many establishments have converted to self-serve fountains where you pour your own drink – and in many cases – you can pour yourself a refill if you like. It probably makes sense from the restaurants point of view – they save a lot on labor costs while they likely don’t lose much money in overfilling. Though the restaurant has changed their delivery method, the size choices are still available. So the question is, why would anyone buy a large size when you can simply refill a small one? This is an unnecessary upgrade. 

Upgrade Your Camera

Cameras come in two basic types: point/shoot, and SLR. For photos of landscapes, fixed people and other stationary objects, low cost point/shoot cameras are excellent. When I bought a camera last year, I upgraded to an SLR because it has the ability to freeze action, whether it’s fireworks, sports, or simply people or objects moving anywhere. The point/shoot cameras can’t do this well so this was a necessary upgrade.   

Once that decision was made and I entered into the SLR camera world, now I am faced with choosing from the dozens of offerings in the SLR family of cameras.  The sky is the limit in cost, you can spend many thousands of dollars on SLR camera bodies. After doing some research, I determined that camera bodies come and go, but lenses are forever. So, I resisted the upgrade and bought a low end SLR camera body.

Categories: Lifestyle, Personal Finance Tags: