Friday, January 30, 2009 Streaming Video Review

I have officially given up my DVR. This helps my pocket book, but I still want to watch certain shows without being tied to a set schedule. One of those shows is Scrubs, which I love despite it's reputation (and maybe because of it). Without a DVR I must either program myself to follow a TV schedule again, dust off the archaic VCR, or find it online. I found it online at This is my experience...

As you may know, I am a Mac owner and a Firefox user. So I was dismayed initially when content would not play in my browser of choice. I was unsure whether it was the browser or the operating system, because some sites only work with Microsoft products. Fortunately everything worked when I tried later in Safari. I'm not sure what the difference is but my main concern is that it works.

Once that was sorted I was able to watch my show. To watch you select "free episodes" from the site's main menu. This displays a list of shows with streaming episodes available online. Click on the one you want and it will launch a new window. In that window you can select which episode of which season you want to watch. Tonight I watched episodes five and six of season eight.

The video quality is reasonable. It's about the same as Hulu's standard definition content. I don't think the experience is as polished as Hulu's though. Like Hulu you can pause, seek, and play the video full screen. There are advertisements, too. It's fairly run of the mill for streaming sites, but at least they didn't miss anything.

Something I noticed is that the player will begin displaying the show while it is buffering, opting for severely degraded video quality instead of a pause while it downloads. This is annoying. My knee jerk reaction to it was that the content must be unwatchable and I would have to look elsehwere. It's good that I stayed because it soon cleared up, but it still happens at the start of every episode.

The ads aren't too bad. In fact, they have a great feature about them: you don't have to sit throught the whole thing. When the player switches to the advertisment, "ad mode," it reverts from full screen, showing the browser window with a graphic ad that has an embedded video in the top right corner. You have to watch the first 15 or 30 seconds, after which most of the ads keep playing but you can choose to go back to your video. The biggest problem is that your show won't automatically continue after the ad is done. You have to click to continue which is quite annoying if you don't have your pointer at your fiingertips. Most of the ads are for other ABC shows, but they have a few for other things.

Overall I was satisfied, if not impressed. I will definitely hit up this site for my Scrubs fix, and I might check out some of the other shows if I get bored. Since I will now get the bulk of my entertainment from online sources, I plan to do more of these reviews. Watch for them.

Tuesday, January 27, 2009

Cutting the Cable

Enough talk. This weekend I took action. I cut my cable service back to basic cable. This means my cable bill will be roughly $13 per month for television. I still have to return the DVR/cable boxes, though, so currently the television part of my bill is around $40.

The number porting process seems to have canceled the VOIP service for me. That part of the bill has already gone away. I am not going to cancel Internet service, so that will represent $50 of my bill. The final cable bill should be ~$63, the actual number depends on what taxes apply.

Here's the breakdown of the old bills:

Cable television, Internet, and phone: $164
Netflix: $15
Total: $179

The new bills:
Cable television, Internet: $63
Netflix: $18
Phone: $15
Total: $96

Savings: $85

After a few months of savings in the entertainment budget I will probably buy another antenna to see if I can get a good enough signal. If I can make that happen then I can save almost $100 per month over the old plan. We already used the first month's entertainment budget to buy Kevin some DVDs. I hope he won't miss Moose, but at least he can still watch a show or two.

One last note: Cablevision's customer service was top notch during my interactions with them. I'm unhappy that they misled me when I switched to their service but at least they were pleasant about everything. Most importantly, I never once had to speak to a customer retention specialist. No one tried to talk me out of my decision. No offers with strings attached. They just did what I asked while treating me politely.

Monday, January 19, 2009

Debt Based Budgeting and Saving

This is an idea I've had floating around in my head for a while now. It should work for people who have credit card debt, but that debt only takes a portion of their budget each month. For this to succeed you will need to be able to budget your money without resorting to using separate accounts or using cash for certain purposes. Also, you'll need to have available credit, you won't be able to do this if your cards are over their limit.

Still reading? Good.

Here's the idea: Pay down your credit cards instead of putting money into savings or keeping it in your checking account, then use those cards for your purchases instead of debit/checks/cash.

This seems to go against most advice to only use credit when you have to. It can work to reduce your debt, or at least lower the interest you pay each month. Since credit card debt is likely your highest interest debt the more you can pay towards it the better. If you budget your expenditures, especially basics like food, and pay that money to your credit card as soon as you get your paycheck then you will lower your average daily balance, and possibly your period ending balance as well.

This uses the Average Daily Balance in your favor. To understand this let's look at an example. Say that I have $1000 in credit card debt at 10% yearly interest. My monthly interest rate will be 0.83%, and that will likely be calculated against the average daily balance on my card. If I pay nothing that month (let's not count any late fees) I would be charged $8.30 in interest. If I do pay something, but I wait until the last day of the billing cycle, my interest will barely change. For instance, if I pay $100 on the last day then my average balance is still $996.67 and my interest will be $8.27. Not much savings this month, it would help the next, though.

To calculate your average daily balance you need need to multiply what your balance was by how many days it was at that balance, then add it to every other balance over the period, and divide the final number by the days in the period. If I bought nothing on that $1000 balance card during a 30 day period, but I paid that same $100 on the 15th day of the period then my avg. daily balance would be calculated as such:

((1000 * 15) + (900 * 15)) / 30 = $950

With the earlier payment I would save almost 50 cents. Now that you see how it works, perhaps you can imagine what it would look like with bigger numbers. Unfortunately, that is about as easy as it gets to conceptualize because normal use will cause fluctuations in the balance that make calculating your average a chore. The important thing to walk away with is that the earlier you pay a credit card the less interest you will pay at the end of the period.

Now we need to apply this to budgeting and savings. The idea here is that if you have money budgeted then you should immediately pay that money to your credit card, lowering your balance immediately, then use that card to buy the things you've budgeted for. During the time between the payment and the purchase your balance will be lower, positively affecting your average.

This works great for groceries. We can continue to use our $1000 debt card to show this. Assume that you budget $50 for groceries each week and you're paid every other week. You use $100 of every paycheck on groceries, but you pay with debit each time. Your money isn't working for you. Instead, pay the $100 immediately to your card (above any normal payment you would make) and use the card for those purchases. Here's how it would look if you were paid on the 1st and 14th day of the period and you bought groceries on the 7th, 14th, 21st, and 28th days:

((900 * 6) + (950 * 7) + (900 * 7) + (950 * 7) + (1000 * 3) ) / 30 = 933.33

Notice how even though our ending balance is the same as it was at the beginning of the month our average daily balance is far lower. In fact, it's actually lower than if we paid $100 on the 15th and never used the card. The interest for that period would be slightly less than if we made a substantial payment in the middle of the month. What happens if we combine the two and make a $200 payment on the 15th ($100 for each, the groceries and to pay down the debt)?

((900 * 6) + (950 * 7) + (800 * 7) + (850 * 7) + (900 * 3) ) / 30 = 876.67

By rolling your budget for monthly expenses into the money you pay upfront to credit cards you dramatically lower your average balance. Think about how much of a difference that could make if you applied it to your food budget (which is likely more than $50 per week, especially if you have a family), your gas budget, and anything else you can pay using your card. If your interest rate is higher then you get more benefit as well, and 10% is a fairly low rate. The other aspect that is hard to quantify is just how much you will save over future periods, because the interest charged this period will accumulate more interest every period until you pay it off.

It works for savings, too. Actually, it works better for savings. If what you are saving to buy can be purchased via credit then you should consider this method. Think about the difference in interest rates between your savings account and your credit cards. I can imagine that the difference is stark. I should note that the better savings accounts compound interest on a daily basis, which will generate more interest than the same rate compounded once a month. That isn't enough to overcome the difference between most savings and credit rates. So, financially you may be better served by paying off your debt instead of saving for purchases.

Even if your savings interest rate is fairly high and compounds daily you should save more money by paying off higher interest debt. In our previous examples we used a 10% interest credit card, which is on the low end, so let's go to the high end of savings and compare a 5% savings account (you can't get these right now, but it will prove the point). Using those accounts if you saved $50 per month, at the beginning of the period, towards a $300 TV you would double your return by paying off the credit card. I'm going to spare you the math, but my calculations showed a credit interest savings (money you don't owe in interest) of $8.84 and a savings interest return (money you earn in interest) of $4.32.

Obligatory warnings and clarifications: If you do this you must be careful about it. Monitor your spending carefully to be sure that you stay within, or at least reasonably close to, your budget. That may limit the usefulness of this plan, because if you are deep in credit card debt you may have issues with monitoring.

This should not replace your emergency fund. The last thing you want in case of an emergency is to run up tons of debt. You may run into problems with that debt down the road. If nothing else, cash is infinitely more useful in emergency situations.

The idea should be that you use this in place of saving to spend or use already budgeted money that you will spend during the course of the month. Don't use this to replace other savings such as retirement, emergency funds, or college funds. Obviously, if you're in debt you should think about discretionary spending carefully. I like to think that this makes such thought easy, because you don't have money burning a hole in your pocket, it's working for you to dwindle your debt.

Lastly, I'd like to apologize for the ugly equations. I tried to keep the math simple and clear. I realize that there are better ways to express the equations I included, but they would be less clear and probably more confusing.

That's it. I'd like to know what you think or if you've done something like this before. Let me know in the comments.

Wednesday, January 14, 2009

Personal Finance

Now is a great time to start a personal finance blog. If you know enough about it to advise others then you should. Over the next few years you're likely to have some success. I'm not going to do that, but it does weigh on my mind a lot so I will probably be writing about it.

Here's the story: I am the sole provider for my family of three. I make slightly less than average for my field and we have a slightly below average income for our area. We do have some debt in the form of school loans, a medical loan, and credit cards. We rent, but the area is expensive so our rent is higher than most of my family members' mortgages. Both of us have a car, but we owe nothing on them. My son is in day care twice a week so that my wife can attend school on those days.

That's the setup. My issue with this is that we are living slightly beyond our means with the school related expenses. Now, that does not mean that my wife should stop going to school. School is an investment, so the debt we incur today will lead to prosperity tomorrow. Instead, it means that we should be frugal wherever we can in an effort to avoid unnecessary debt on top of what we already have, and what is needed to accomplish our goals. At the same time I want to avoid a significant hit to our quality of life and be sure that we can provide my son with a fun and loving childhood.

I plan to make a few posts about what I'm doing to set my finances straight and how it's going. I don't think this will hit the same level of output that my political blogging did leading up to the election, though. I hope to have a few unique ideas, and maybe share some experience that can help others. At the very least I may bug my wife less about it.

Cancelling Cable Update

Last time I wrote about canceling my cable service. Since then, I tried an antenna and I received my new VOIP package. I also investigated a little bit and found that I may be able to significantly save on my cable bill without completely canceling television service.

First, the VOIP. I haven't tried the new service, but I am impressed that it arrived so quickly. They are already processing the number port and they say it should happen this Friday.

Next is my disappointment with the first antenna experiment. I walked into the local Circuit City and bought an RCA ANT146. I was able to pick up two PBS channels in English, one of them HD, and around nine foreign language channels in standard and high definition. The major networks from New York were mostly static, and high def. was out of the question. I'm thinking of buying a Winegard SS-3000, which is highly rated on Amazon and seems to be made for the sort of situation I have. (My windows face away from the direction of the signal origin.)

Finally, I learned that the cable company still has a basic cable package for a mere $12 per month. That's $12 more than I want to give to the cable company, but it may be worth it to cover sports, news, and prime time. According to the cable company I need a cable box to receive the HD version of the broadcast networks, but I was able to pick up those channels without the box on my HDTV when I tested last night. If I have to settle for this package then I will be eating a quarter of my entertainment budget, but it may be better than antenna frustration and it's still almost $90 cheaper than the package I have now.

Thursday, January 8, 2009

Canceling Cable

The special package price on my cable service expired in November. Suddenly I'm faced with a $165 per month cable bill. That includes Internet and phone service, but it's still a big bill for entertainment and communication. Especially when you consider that I'm also paying around $100 for a few cell phones and $15 for NetFlix.

My first order of business
is to cancel the phone service they offer. After the introductory period it now costs $35 per month. I only take a very few inbound calls using that phone. I'm going to go with BroadVoice's In State Unlimited plan, which is ~$15 per month after fees and taxes.

Next up is the television service. This one is interesting. I like TV, and I think it is possible to consume it without becoming a zombie. It's just not worth the $100 per month that I'm paying for basic ($55 or so), digit/HD ($10), and two DVRs ($35). Don't get me wrong, I think I have a great setup and as far as cable goes I think Cablevision does pretty well. It's just that I don't want to pay $1200 a year to watch it, not anymore at least.

As for the Internet service, I will keep it. It's $45 per month if you have their cable service, and it will be $50 per month when I get rid of it. Cablevision's Internet service is very good, and FiOS isn't available in my area so there is no competition for it here. I'll need it for the VOIP service anyway.

In case you've been keeping a tally, $35+$100+$45 != $165. I know. I get a whopping $15 discount for having all three services. Good thing, because $180 per month would be intolerable. Glad I don't have HBO.

Next up, I have to figure out what to do instead. I don't want to miss out on sports and I do enjoy a few sitcoms. My son watches a few cartoons, most of which we record on the DVR so he can watch them according to his schedule. My wife occasionally watches the news and the weather channel. Otherwise, our television viewership consists of random stints, almost entirely by me. I still want to have access to some of that, and I've come up with a bit of a plan.

I can sum it up in three words: Antenna, Netflix, Hulu. There are other aspects to this but those are my main weapons. Other factors include purchased DVDs, video games, and probably turning the TV off.

Antenna - I have to purchase an antenna for my HDTV. I've yet to do this, and it may be the most crucial element here. If the antenna doesn't work well then I will miss out on sports, something I really enjoy watching. Even with the antenna I will be forgoing ESPN, I'd rather not lose everything else. The antenna will also provide access to local news and primetime television.

Of course, I haven't purchased an antenna yet. I don't know how well it will work. I'll have to mess with it and I may have to make multiple purchases before I'm satisfied. That's fine, because I live in a major television market so I'm confident I will be able to find something that works.

Netflix - I already have Netflix, and most of the movies I watch are Netflix rentals. I'm a fan of the service. Right now I have the two out unlimited service. Under my new strategy I will return to at least the three out unlimited plan, but I may increase that. I plan to try to take advantage of their streaming content, a library that seems to grow constantly. It will be a great way to spend a boring night if I don't have a movie at home or I'm not in the mood to watch any that I have. This leads me to the third part of my plan...

Hulu - Have you tried this service yet? They offer DVD quality streaming content and they have a wide variety ranging from obscure crap to some of the most popular shows on TV. Hulu has commercials, but they seem to have less than TV and so far they aren't mixed such that they make you pee your pants when they come on. Obviously this isn't the only service to offer streaming video, but right now they're the best option to directly replace television viewing. Veoh, Netflix, and in some cases the show's website offer similar streaming content. Another option is iTunes, where I may be able to purchase episodes of shows. So far there are no current episodes of any show I like available there, but who knows what the future might bring.

There you have it, my three pronged attack at the rising cable bill. I anticipate that this will save me at least $100 per month. I will save part of that money toward an entertainment budget that I will use to buy electronics and content. I hope to buy or build a media center PC sometime later this year so that I can record off air content and watch digital content on my TV.

Will this be as convenient as cable? Of course not. There is a reason why cable costs money and people pay, because it's easier than doing something like this. I won't get as much content, either. With my current package I get around 300 channels. Many of them broadcast 24 hours a day. Having a DVR attached to this opens the door to countless hours of content, more than I can consume. It's like the Golden Corral of entertainment.

Instead, I will use my entertainment budget to target my viewership. I will focus on things that I am more likely to enjoy, instead of whatever the networks decide to put in my viewing window. It will take more work to find these things, and sometimes I will have to pay for them, but I will be saving far too much to mind. Besides, I'm sure a little less consumption is a good thing.