What to Do With Your Tax Refund?

Let’s Go Crazy!

I am assuming that you will be receiving a tax refund this year (if you are not keep reading maybe you can get some ideas for next year). I have been reading a bunch of posts from various financial bloggers about what are the worst things to do with your tax refunds, and I must admit I have been berating folks about mis-spending money lately as well ,so let me first preface this post the only serious misgivings I would have with your Tax Refund would be:

  1. You shouldn’t really have one, next year try to owe nothing, that way you already had the money to enjoy
  2. You take your refund money and do something illegal with it, or worse you do something that puts you farther into debt
  3. You get a quick refund from some place like Money Bamboozlers (or whatever)

With point (2) I mean using your refund as a down payment on a car or have it pay for only a small part of a ludicrously expensive vacation!  As for point (3), you know my opinion of the Pay Day Loan world and I lump the “quick rebate” firms in there too.

Don’t Go Crazy!

Now that you have this tidy pile of cash, what can you do with it?

Money, Coins, Pennies

Money, Money, Money!!!!

  • You could use it on some of the projects on your Honkin Big Summer To Do List, or better still hire someone to do some of the things you want done.
  • Repair the brakes on your car (no you shouldn’t be waiting for a rebate cheque if you are driving the car).
  • Invest it in an RRSP or your TFSA? That is a good idea, and if you put it in your RRSP, you are setting up for another rebate next year (or you could lower your taxes at the source as well, if you fill in the right forms, and get a receipt right away).
  • Pay down debt, is (in my opinion) the best choice, since that is an excellent way to get rid of debt (use found money to pay down debt). If you have debt, think about using this wind fall to get you out of the debt trap.

What are you planning to do with your tax rebate, or were you smart enough to not owe anything, or be owed anything?

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Price Matching with a Twist

I have written previously about price matching with Best Buy and I have been successful previously getting Best Buy to match prices from other stores, however, this past weekend I ran into a new and interesting twist in the price matching game that I’d like to share with you dear reader.

Same but Not the Same

This past week I bought an LG portable DVD player for our car, so my son can watch movies while we take longer car rides. I found a reasonably price player at Best Buy and purchased it and it seems to be working just fine. 

My wife noticed on Friday that the Future shop seemed to have the exact same player on sale for $30 cheaper, so I decided on Saturday to trek down to Best Buy and get my $30 off (they have a price matching policy within 30 days of purchase, which I have taken advantage of previously).

I showed up at the service desk and the pleasant young lady there asked me what I needed help with. I pointed out the Future shop circular and I had a copy of the bill from my purchase and I figured within a short period of time I would receive reimbursement.

Wrong! 

The young lady was very pleasant with me but pointed out that the product identifier was NOT the same for the two products. The item I had purchased is an XXXX-NR whereas the Future Shop item was an XXXX-NB, it was in fact the exact same product, however it was identified differently, thus Best Buy would not match the price, because of this difference.

I then noticed in the Ad that the device in question at the Future Shop had a logo on it that said, “Exclusive to the Future Shop”, which I should have noticed before I left, so that one was my mistake.

In hindsight, I should have done one of the following:

  1. Shown up at Best Buy with the entire device in hand in it’s original packaging, if they then said they would not match the price, I could have simply returned it and bought it at the Future Shop.
  2. Gone to the Future Shop and bought the cheaper player and simply returned the more expensive player to the Best Buy.

I may do that yet, but I will wait a week to see if the item goes on sale at the Best Buy.

I am not pleased with this “fine print” trickery to save having to pay out on price matching, especially since Best Buy and Future Shop in Canada are owned by the same company (I believe).

Sort of leaves you with a funny taste in your mouth, and in my case $30 less in my wallet.

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Is it Over?

The markets had a rally yesterday and many stocks had nice comebacks, but will it last? All of this hinges on some kind of remedy on the mess in the U.S., so only time will tell on this one.  Will it all come back to where we were before this mess? Most stocks will, but some may take a long time to come back (my guess anything to do with Financial Institutions in the states, or that had exposure to this mess).

No Trigger For Canadian Housing Bubble Burst

The CIBC is claiming their is no trigger to cause a housing price meltdown similar to the one in the U.S., since we don’t have sub-prime loans and we only have a small percentage of non-conforming mortgages. Good to hear someone say that, but wasn’t the CIBC one of the Canadian banks most affected (effected?) by this whole mess in the U.S.?

GDP Up in July

The Canadian GDP was up 0.7% in July which is good and is larger than the increases of only 0.1% in May and July. This information while useful also precurses the current financial mess that we are in, but it is still heartening to think that the Canadian Economy for now is doing ok.

Another Surplus for 2008

Jim Flaherty announced that this year Canada will have a budget surplus of almost $3B. That news can only help the Conservatives during the election, and just makes me wonder what will be done with that extra money? My hope is more National Debt pay down, which will help our kids as much as any Green Tax might (IMHO).

Fraud Remedied

TD has repaid me the money that was defrauded from my account, using a duplicate made of my wife’s access card (I am a Victim of Debit Card Fraud). All of it was paid back, which was good, but it did take a while, so I owe some money on my secured line of credit as well. TD phoned to say that the case had been referred to the police and would not comment any further. The next time I am in Montreal I will look for Bar Le Bievre which was where the withdrawals came from, just for my own curiousity.

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Stupidest Bill Ever

About 8 years ago, my wife and I bought something at Colonial Furniture, and paid it off on lay away using a “no interest” plan of some kind. At the end of the period, when we finally paid off this bill, we had made a mis-calculation and over paid the bill by about $4.56, but nothing has ever happened with this positive balance (I have not bought anything there since).

The stupid part of this is that every month since I paid off this bill I receive a balance statement telling me about my positive balance. If my caculations are right I have received about 90 of these notices, and this must have cost somewhere near $40.00 in postage for Colonial, to tell me about my positive balance.

Every month I get this invoice and every month I scratch my head wondering why they do it. In other instances where I have had a positive balance, I have simply received a cheque to return the balance to zero, but not here. 

Rocky Financial Roads

Given the complete implosion that seems to be happening in the United States, I continue to get from friends articles about the impending end of civilisation as we know it. My opinion is that this whole thing are ripples from the ill-conceived “Sub-Prime Mortgage” fiasco in the states, and my guess is there are more ripples to be felt, which hopefully will not cause too many more days like Wednesday.

My portfolio is not doing too badly, but I do see some stocks that may never recover and one of them being Nortel . It is now down to $2.76 but if you take out the reverse stock split the stock is actually worth $0.276 (Canadian), and they continue to sell things off to get money.  I hold a little Nortel in one trading account, mostly because I never got around to selling it, and now it isn’t even worth selling (I’d spend more on the trading fees, than I would get from the sale).

Is this “correction” a buying opportunity? I think some time soon it will be, if not right now, but remember to do your homework and don’t just “buy because I think it is on sale”, because if you had done that with Nortel in 2002, you’d have been mistaken. Do the homework, investigate the company, make sure their financials are sound and the company is sound as well.

Lock It Up

Lock It Up

Debit Fraud Follow Up

Some excellent comments yesterday about my article about Debit Card Fraud . I think I will be going more towards a cash based purchase system to remove some of this risk, but a few commenters mentioned using a credit card instead, since your liability is limited. 

While this method may work for a lot of people, I don’t think it is for me, since a few years back we tried this with a PC Financial Mastercard, to get money back on our groceries. Due to some bad tracking by me, I ended up with a ballooning credit card balance that scared me, so we ended up paying off the card quickly and then going back to using the debit card.

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Consumerism Case Studies Best Buy

As I mentioned last week we purchased a new camera last week and didn’t get the extended warranty.

This past Friday (6 days after purchasing the camera),  I read the Future Shop flyer and saw that the same camera is now selling for $50.00 less. I tend to read the Future Shop and Best Buy flyers because I am a techno-geek and like to window shop for things I can’t afford (and know I shouldn’t buy), and this time it paid off very nicely.

I went off to Best Buy, and was my normal polite self, I had my bill with me from the previous Saturday and spoke to the young lady at the Customer Service (sic) desk (I also brought a copy of the Future Shop Ad for the camera). The young lady was very polite as well and then checked and Best Buy was in fact carrying my Camera (Canon S5 IS) for $50.00 less also, and because of this my account was credited for $56.50 (after tax rebates and such).

Well worth the trip, even though I most likely spent $4.00 worth of petroleum to get my money, but money well retrieved. Most electronics stores, and I believe most big box stores (aka Wal-Mart) have this kind of purchase protection plan and it is important to make sure you are not being over-charged and you are taking advantage of later sales on products you have purchased.

I am thinking now, I should have raised a mild stink and asked for more than $50.00 back, because the sales person at Best Buy should have known this camera was going to be on sale in the next few days, but I didn’t think of it at the time.

Extended Warranty?!?

As I stood in line I saw another interesting piece of consumer sleuthing that I feel it is important to report on as well.

A young lady was in front of me, and she had her iPOD touch with her, and there was some issue with it not working correctly. The young lady had her original box, and her extended warranty (which we said she paid $70 for (I believe)), and the Customer Service rep was very polite and said she’d have a look at it.

The Customer Service rep then told her something that caused my ear hear to prick up. Evidently if the Best Buy Customer rep couldn’t repair or make the iPOD work successfully, the young lady (customer) would have to send it to Apple, because it is within a year of purchase and Apple does all repairs in the first year.

Let that sink in, the customer has purchased an extended warranty from Best Buy, however, Apple’s warranty covers the exact same repair in the first year (presumably the first year of the extended warranty as well).

Read that previous sentence again, and tell me you didn’t at least have a “WTF” moment.

What is the use of this “Extended Warranty” if Apple repairs this and not Best Buy? The Customer Service rep in fact said, the customer must send the iPOD back to Apple, because Apple will not accept the iPOD if it is sent in by Best Buy. Another “WTF” moment for me.

So the extended warranty you purchase overlaps with Apple’s, and is effectively redundant (i.e. useless).

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