Category: Personal Finances

Moolala: Ooo La La?

Moolala is the most recent opportunity that I have been offered that operates like Grupon or LivingSocial Deals.  Businesses offer reduced rates on services or goods;  I am offered the opportunity to purchase them.  Grupon offers me $10 if I refer friends.  From Grupon’s website:

We’re giving $10 in Groupon Bucks for every friend you refer when they make their first purchase. It’s our way of saying “thanks” for spreading the word and increasing our collective buying power! Groupon Bucks can be used toward any Groupon purchase, and they never expire.

LivingSocial offers my deal for free if I share my purchase and at least three people buy it:

Share for a Free Deal
After you buy the deal, you’ll get a unique link to share. If three people buy the deal using your link, then your deal is free.

Here’s Moolala’s pitch:

There’s more – we want to help you make money, too!
We will give you 2% back on each deal you buy. And for each friend you refer to Moolala, you will earn 2% of every deal they buy. And that’s not all: we’ll pay you 2% for each friend they refer, and again for your friends’ friends’ friends and your friends’ friends’ friends’ friends. It’s a 2% five-level reward system. That adds up to lots of rewards for you and your friends.
Use your rewards to buy the Moolala deals you love or even redeem them for cash. It’s up to you.
So start inviting friends and earning rewards now.

There’s more – we want to help you make money, too! We will give you 2% back on each deal you buy. And for each friend you refer to Moolala, you will earn 2% of every deal they buy. And that’s not all: we’ll pay you 2% for each friend they refer, and again for your friends’ friends’ friends and your friends’ friends’ friends’ friends. It’s a 2% five-level reward system. That adds up to lots of rewards for you and your friends.

Use your rewards to buy the Moolala deals you love or even redeem them for cash. It’s up to you.
So start inviting friends and earning rewards now.

Whenever I see “we’ll pay you based on your friends’ friends” ,  I immediately think,  “pyramid selling and chain letters.”  It appears Moolala is an Austin based business that was formed in 2010.  Here’s the LinkedIn reference. I joined Moolala to help  my missionary, traveler friend receive his 2% should I make a purchase.

My least favorite is the LivingSocial offer.  I’m not sure I know three people that would make the same purchases as I would make.  My choice is between the immediate $10 of Grupon or a potentional stream of 2% commissions of Moolala.  The Grupon offer seems more bird in the hand to me, so I would choose Grupon.  Except, what if all of my friends have already signed up?  Then I think that there’s “no soup for me.”

It will be interesting to see which company is most rewarded by the market place.

Paying for Health Care

On December 31, 2010, many of the products currently eligible for reimbursement through Flexible Spending Accounts will no longer be covered unless your physician provides you with a prescription.    That’s important to note since you can get your physician to write a prescription for the expensive OTC drugs that you use, and you will be eligible for reimbursement.  You will need to send in your prescription with your receipts for reimbursement, and you will not be able to use an FSA debit card.  That may be a good thing since many of the those debit cards are a nightmare to use.

Here’s a handy list of qualified and nonqualified expenditures post 12/31

heb.com/fsa

The Joint Committee on Taxation estimates that this will generate revenue in excess of $5 billion in the first ten years.

Here’s  a website that you can use to calculate your share of the $5 billion: Save Flexible Spending Plans.

Tracking Travel & Entertainment

Capturing expenses on the road is important  for completing expense reports for your employer or for creating complete and accurate records for your federal tax return.

Credit network processors like Visa and MasterCard and banks have been developing new tools for corporate customers in anticipation of a rebound in business travel, reported Martha C. White  (NYTimes).

Concur Breeze was developed with American Express.  There is an app for all three smart phone platforms.  Take note small business:  the first two users are always free and the software integrates into Quickbooks.  Here are reviews.  To use the mobile app, you need to set up account at www.ConcurBreeze.com, then return to the app store with a mobile PIN.

Fyi, in fall of 2009, Intuit, the maker of Quicken, acquired Mint.com for personal finance and budgeting.  Free apps are available.    Searching for Quicken iPhone apps returns Quicken Online Mobile, but an iPhone  app store search does not return that app.  Mint has a blog that reviews financial apps.

Traveling Mercies

As  you travel this summer, take care with your credit card.  Joe Sharkey writes that “Credit Card Hackers Visit Hotels All Too Often”:

A study released this year by SpiderLabs, a part of the data-security consulting company Trustwave, found that 38 percent of the credit card hacking cases last year involved the hotel industry. The sector was well ahead of the financial services industry (19 percent), retailing (14.2 percent), and restaurants and bars (13 percent).

Read the full article.

Don’t throw good money after bad

Austin Talk Radio Batters Metrorail

Not a real headline but the discussion was a good reminder of how to NOT make a decision to abandon a project.

Investors are notoriously emotionally involved in decisions that they have made.  It is almost impossible to divorce ourselves from the consequences of important decisions that we have made.  This is called  Loss Aversion.

When we have made a decision such as investing $65 million  in a Metrorail or $5000 in WholeFoods and watch the trains operate at a loss or our stock decline by half of its value, our loss aversion and emotions keep us from correctly considering our original investment as a sunk cost.  Sunk costs are non recoverable costs that force us to admit that we have made a bad decision.

Some decisions require that we abandon our prior investment and invest additional funds that will correct the decision.  One example is abandoning a website that is too expense to maintain but that cost $15,000 for a $1000 out of the box website that works great.

Other decisions require that we look at future operations but on a cash flow basis.  If an operation, perhaps a commuter train, is cash flowing, consideration of the original investment is irrelevant to the decision as to whether to continue or stop the train.  The relevant costs to compare with income from the project are the costs that will end if operations are ceased.

Finally, we might need to consider selling assets that we can’t afford to pay for even though we would lose our investment, especially if we can pay off any debt associated with the property.  Continuing to own an asset with operating losses due to mortagage payments that could be sold is also an example of loss aversion.

How much should you give?

Ron Lieber writes in the NYTimes,  April 30, about alternative computations of the amount to give to charity.    He reports the methods in the Bible and in the Koran.  He quotes Brent Kessel who wrote “It’s Not About Money” , and Peter Singer who wrote “The Life You Can Save.”  He quotes letters from Gerard Manley Hopkins, a Jesuit priest,  to Robert Bridges, both 19th century poets,  in which the priest suggests that his friend give alms to the point of personal inconvenience if he wanted to become familiar with the nature of Christian belief.  Lieber concludes with a call for more readily available payroll deductions such as the United Way facilitates.

Read the full article here.

Reservation Launch Time for Texas Appliance Rebate Program

The Texas Trade Up Appliance Rebate Program reservations officially begin Monday, April 5, at 7 a.m. CT, when consumers can receive rebate forms for select ENERGY STAR® appliances by visiting the online reservation system at www.TexasPowerfulSmart.org or calling (877) 780-3039. Texans can use the rebates to buy energy efficient appliances in eight different appliance categories and replace the same type of old, functional appliance.