Free Stuff - things you should never pay for

This post comes from Stacy Johnson at partner site Money Talks News.

21 things you should never pay for

If you want to find extra money in your budget, stop paying for things you could get for nothing.

By MSN Money partner Oct 5, 2012 11:30AM

There are only two ways to become richer -- make more or spend less.

One of the best ways to spend less? Stop paying for things you could get free.




Here's a list of 21:

1. Free cars for long-distance trips
Many people want their cars moved from place to place but don't want to do the driving. Sometimes these cars are delivered by truck, but often they're driven -- by people like you. If you have a clean driving record, a car delivery company like AutoDriveaway might hook you up.

I did car delivery a few times when I was in college and found it a great way to get where you're going. It's best if you're flexible about when you leave, return and perhaps even where you go. You still have to pay for gas, and the trip home can be problematic. I used to hitchhike, but smarter choices today would be bus, plane, train or waiting at the other end for another drive-away car.

2. Free lodging
Why stay in a hotel when nonprofit Couchsurfing.org offers tourists a chance to stay at homes for free? Make friends with sponsoring families throughout the U.S. and countries ranging from Croatia to France. You have to set up a profile on the CouchSurfing website, which provides tips on how to find families willing to open their homes to you. Obviously, the digs won't be fancy, but they'll be free.

Another way to get free lodging is to home swap.

3. Free audiobooks
Now you can find out for free the fate of Pip in "Great Expectations" or Elizabeth in "Pride and Prejudice" as you drive or jog. Download free audiobooks from nonprofit LibriVox.org, which has volunteers recording classics in the public domain. You can also volunteer to help by reading. LibriVox will even provide you with free recording software.

4. Free food
There's at least one day every year when you shouldn't think of paying for a meal. Frugal Living has a list of hundreds of businesses that offer birthday freebies, most of which are food. For a free libation at your favorite pub, do what I do: Loudly proclaim it's your birthday. Often people within earshot will pick up your next round.

5. Free food for kids
Don't go to another restaurant that doesn't feed your kids for free. MyKidsEatFree.com offers a roadmap of where you can save on kids' meals. You'll pay, but your kids won't at more than 5,000 restaurants across the country.

6. Free samples
Before you go to the drugstore and shell out silly sums for travel sizes of your favorite toiletries, go to Volition.com or one of many other websites that offer free samples. In addition to soap, shampoo, etc., you might find all manner of interesting things. For example, we've spotted circus tickets, a free diet analysis and free advance movie screenings. Other free megasites include TheFreeSite.com and Freechannel.net.

7. Free TV
While more than 100 million Americans shell out an average of $75 every month for satellite or cable TV, local channels are still free. And thanks to digital signals, reception is better than ever. You can also find free TV shows and movies online.

8. Free software
You can get free software for word processing, spreadsheets, presentations, graphics, databases and other uses by going to OpenOffice.org. And that's the tip of the iceberg. No matter what kind of software you want, you can probably find it for free.

9. Free anti-virus
This one could go under "free software," but it's important enough to warrant its own spot on the list. We provided a solution on MoneyTalksNews.

10. Free speech
Make your voice heard around the world with your own blog. Many companies will help you set up your own site at no charge, such as WordPress and Blogger. They'll even give you free, easy instructions and a choice of blog templates.

11. Free foreign language lessons
The BBC is on the other side of the pond, but it offers free 12-week classes to learn French, Spanish, Italian or German -- gratis. You'll even get a certificate at the completion of the course. The BBC also offers other audio and video courses in the four languages, as well as help with learning other languages.

12. Free checking
According to The Wall Street Journal, the average minimum checking account balance required to avoid a monthly fee at U.S. banks is $723, and the average monthly fee is $5.48. But banks aren't the only game in town. While not all credit unions offer free checking, the prospect of lower fees is one of the reasons you should join one.

Another option is online-only banks. Without the overhead that brick-and-mortar branches have, the terms are often much better. Consumerism Commentary ranks the best online checking accounts.

Too much hassle to leave your bank? Threaten to and see if you can have fees reduced or eliminated.

13. Free credit reports and scores
Don't pay for a copy of your credit report. Instead, go to AnnualCreditReport.com for a free look at each of your three major credit reports once a year.

As for free credit scores, you can turn to websites like Credit Karma or Credit Sesame, although they won't give you the most widely used score, the FICO score. For that, you could try enrolling in a FICO product that comes with a free score, then canceling within the cancellation period.

14. Free cash
Tired of paying a $2.50 "convenience fee" for using an ATM that's not in your bank's network? Use an app like ATM Hunter to find a branch ATM. If you can't find an ATM near you for a free cash withdrawal, no worries: Plenty of stores will give you cash back with no fee when you make a purchase with your debit card.

15. Free information
Use the search feature on your smartphone, or text a business name to Google, and you'll get the number texted back. You can also dial Free 411 at (800) Free411. The results are sponsored by companies (you'll have to listen to a 10-second ad), but it's free.

16. Free scholarship search
Plenty of websites, such as Fastweb, offer free searches for scholarships. A company called Free Scholarship Searches offers links to 40 websites that offer free scholarship searches.

17. Free baggage
My wife and I went to Europe for 10 days with just one carry-on each. If we can do it, so can you. But if you insist on checking a bag, try to fly with the only two airlines that allow a free checked bag: Southwest and JetBlue. And avoid the two that slap consumers in the face by charging for carry-ons: Spirit and Allegiant.

Need to check a bag and fly an airline that charges? Delta, United and American all offer credit cards that include checked-bag-fee waivers for cardholders and, in some cases, their companions.

18. Free entertainment
Your local library, parks and universities offer lots of free fun, from books and DVDs to plays and concerts. Join email lists to see what's up. And of course, there's the Internet, offering free games as well as articles. Just go to the website of your favorite news source.

Volunteering doesn't cost a dime and can pay off for both you and your community. Local animal shelters, homebuilding groups, shelters and food banks are always looking for volunteers. And check out volunteer opportunities at local festivals and events. By volunteering, you get to go to the event free.

19. Free water
While technically not free, tap water is about as close as you can get. If you're concerned about water quality, buy a filter.

20. Free telephone calls
Always calling a loved one long distance? If you both get something like Skype, you can talk all you want without paying a dime. And with a service like Google Voice, you can get all of your cellphone calls free too.

21. Free everything else
You have something you don't want but it's too valuable to throw away? You might donate it to charity, but you also might give it away at sites like Craigslist or Freecycle, a nonprofit set up to help you find free stuff and keep it out of landfills. From used furniture to sports equipment, you'll be amazed at what people give away.

What Ever Happened to Eastern Financial Credit Union (NYTimes)

May 14, 2010
A Credit Union That Played With Fire
By GRETCHEN MORGENSON

WHEN Wall Street is accused — as it has been so often these days — of selling risky products to unwitting customers, it usually argues that investors in such exotic stuff are sophisticated adults capable of assessing any hidden dangers.

So it goes with collateralized debt obligations, or C.D.O.’s, which are bonds, loans and other assets that the Street pools together and sells as packages of securities. Purveyors of C.D.O.’s maintain that buyers who lost billions in these mortgage-related instruments were, of course, sophisticated.

But as a recent report from the inspector general of the National Credit Union Administration shows, it is neither credible nor factual that only savvy investors bought C.D.O.’s.
The report analyzes the April 2009 collapse of the Eastern Financial Florida Credit Union. Based in Miramar, Fla., this state-chartered institution was created in 1937 to serve the Miami employees of what later became Eastern Airlines. The institution added other Florida employee groups and was serving 208,000 members when it failed last year.
Eastern Financial had $1.6 billion in assets at the end of 2008. The company was placed in conservatorship on April 24, 2009. It was taken over by the Space Coast Credit Union of Melbourne, Fla. The failure will cost the National Credit Union Share Insurance Fund, the federal agency that guarantees credit union deposits, an estimated $40 million.

Because it was based in Florida, the doomed credit union had its share of bad real estate loans on its books. But the inspector general’s autopsy report said that the major cause of the Eastern Financial collapse was its decision to dive head-first into toxic C.D.O.’s just as the mortgage mania was faltering.

Between March 2007 and June 22, 2007, the credit union committed nearly $100 million to buy 16 of these instruments; most contained dicey home equity loans.

The timing of these purchases is intriguing. The spring of 2007 was when Wall Street’s mortgage machinery was sputtering; New Century Financial, a big subprime lender, filed for bankruptcy that April. Brokerage firms that had provided funding to lenders like New Century and Countrywide began pulling in their credit lines. At the same time, it became a matter of some urgency for these firms to jettison mortgage-related securities in their pipelines.

Who sold Eastern Financial its toxic securities? Alas, the inspector general identifies neither the C.D.O.’s the credit union bought nor the firms that peddled them.

But the report did note that the instruments Eastern Financial bought were private placements, “which provided less readily available market data to perform analysis and provide better understanding of underlying assets and grading system, tranches, etc.” In other words, the most obscure C.D.O.’s imaginable.

“This situation illustrates yet again why over-the-counter securities and derivatives are not suitable for federally insured banks and other ‘soft’ institutional clients,” said Christopher Whalen, editor of The Institutional Risk Analyst. “Wall Street securities dealers who knowingly cause losses to federally insured depositories should go to jail.”

Credit unions are nonprofit entities and typically do not engage in the risky investing that bank executives did during the credit bubble. Federal credit unions are also limited in the types of securities they can buy. While they can purchase mortgage-backed securities, they are barred from buying C.D.O.’s.

State-chartered credit unions have more leeway to invest in exotic instruments if their home states allow it. Florida, California and Michigan are three such states. But according to the National Credit Union Administration, less than 1 percent of all credit union investments fall into the exotic category.
THOSE state-chartered institutions that can buy C.D.O.’s and other riskier investments must set aside reserves of 100 percent of mark-to-market losses in such securities when they decline in value. This is intended to deter credit union executives from venturing down the risk spectrum.

The Florida credit union met that requirement, but clearly the deterrence didn’t work. Eastern Financial’s failure may be an outlier, but it makes for a terrific case study.

Indeed, the inspector general’s analysis is depressingly familiar. Eastern Financial’s management and board “relied too heavily on rating agencies’ grading of C.D.O. investments,” it concluded, and failed to evaluate and understand their complexity.

Almost immediately after the credit union bought the C.D.O.’s, they fell in value. By September 2007, the credit union had recorded $63.4 million in losses on the products, almost two-thirds of the original investment. By the time of its failure, the credit union had charged off all 18 C.D.O. investments, resulting in total losses of nearly $150 million.

Richard Field, managing director of TYI, which develops transparency, trading and risk management information systems, says the Eastern Financial collapse is yet another example of why investors in complex mortgage securities need to be able to consult complete loan-level data on what is in these pools.

“A sizable percentage of the problems in the credit markets and bank solvency are directly related to this lack of information,” Mr. Field said.

But the Eastern Financial insolvency also illustrates why regulators should make Wall Street adhere to concepts of suitability for institutions as well as individuals, Mr. Whalen said.

“The dealers who sold the C.D.O.’s to this credit union should be sanctioned,” he said. “It might even be possible to pursue the dealer who sold the C.D.O.’s under current law. At a minimum, the Securities and Exchange Commission should impose retail investor suitability standards onto banks and public sector agencies to end the predation by large Wall Street derivatives dealers.”

Will the National Credit Union Administration pursue any of the credit union’s executives or the firms that sold it the toxic securities? “We always consider potential claims of third-party liability in cases of this magnitude," said John J. McKechnie III, director of public and congressional affairs at the administration.

How Long for that Check to Clear ? (NYTimes)

September 19, 2009
Your Money
Hurry Up and Credit My Account
By RON LIEBER


What is it with these banks that are so quick to hit you with a fee for spending more than you have in your checking account but take their own sweet time in crediting deposits?

My colleague Andrew Martin and I heard that complaint repeatedly from readers after we wrote about overdraft fees earlier this month. The angry questions happened to arrive as we approach the five-year anniversary of when the federal law known as Check 21 took effect. The law allows banks to turn paper checks into digital images and settle them electronically instead of shipping bags of paper around the country on airplanes.

Once banks embraced the new procedures, money disappeared from your account much faster when you wrote a check. But the old laws on how quickly banks must credit your account when you make a deposit did not change at all. They still haven’t. In fact, they haven’t changed in more than 20 years.

In part because of that, consumers are suspicious that banks earn more money by not making the funds available until they absolutely have to. Banks, meanwhile, say that they often make deposited funds available before they know that the checks haven’t bounced.

The banks and the Federal Reserve have made some progress in speeding up many deposits. But the rules — and especially their exceptions — still trip up plenty of people.

So first, a refresher course on the rules, the ones the bank explained to you when you signed up for an account in a fine print document that you probably ignored.

Banks are supposed to allow you to withdraw the following types of deposits no later than the next business day after the bank receives them: cash, electronic payments like paychecks and other direct deposits, government checks, postal money orders and cashier’s checks. That said, if you don’t make the deposits in person (say, if it’s through an A.T.M.), there may be further delay.

For other checks, the Federal Reserve rule that governs deposits makes a distinction between local checks and nonlocal checks. Once you deposit your check in your own bank, it may go to a Federal Reserve check processing center before it heads to the bank of the person or company who wrote it. If the same center services both banks, then the check is local. If not, it’s nonlocal.

Banks must make your deposits of local checks available no later than two business days after you hand them over. But they get a full five days on nonlocal accounts. In either case, they must make $100 available to you the next business day after the deposit as a sort of good-faith advance. That number, too, has not changed in two decades.
One piece of good news here is that because of the rapid adoption of electronic check imaging, the Federal Reserve is a year or so away from completing the consolidation of all its processing centers. As a result, many more checks are already local. So when you deposit them, they hit your account more quickly.

The bad news, however, is that there are still a number of exceptions that allow banks to put a hold on part or all of the deposit, often for at least five business days. Any deposit over $5,000 is automatically suspect. If your account has been overdrawn at least six days in the last six months, then the bank can delay all deposits to your account. If your account is less than 30 days old, then your bank gets the extra time there, too (plenty of fraud happens in new accounts).

The large deposit exception ensnares plenty of people, according to Gail Hillebrand, senior attorney for Consumers Union. They include those who are paid on commission or quarterly and those earning royalties, and a large number of others moving money around from, say, a brokerage account to their checking account to pay big medical or tuition bills or buy a car or house.

She suggested taking an active approach with the bank when big money is involved, deposit by deposit. “Ask the bank if there will be a hold and how soon you can have the money. Don’t assume it’s going to be there because the teller smiled at you and accepted it,” she said. “If you’re moving money for a big payment, do it well in advance.”

Banks can and do move faster than the regulations require. And some have pushed their daily deadlines for depositors later by a few hours. Credit unions, in particular, tend to clear deposits more quickly, according to a 2007 Federal Reserve study of the effect of Check 21.

But you can’t count on that happening. So if you can’t keep a cushion in your checking account to protect yourself from running out of money while waiting for deposits, there are a few other available tactics.

Use direct deposit for everything you possibly can, from government benefit checks to tax refunds to reimbursement from your health insurer or flexible spending account administrator. Freelancers who do regular work for large companies can often receive payment via direct deposit, too.

If you’re sending money to a child in school or supporting a relative in some other way, you’ll spare yourself a lot of desperate phone calls if you can find a way to transfer money electronically into their account from your own linked account, say by listing yourself on the account with them.

There’s one big win for consumers arising from Check 21 that should have happened by now but mostly hasn’t. It’s something bankers like to call remote deposit capture. In plain English, that means you scan the check using your home computer and send it to the bank without having to bother with envelopes and mailboxes or remembering to stop at the branch in person.

Banks were fairly quick to make this available for their biggest customers — businesses. But only a couple of hundred banks or credit unions have given it to consumers so far, according to Bob Meara, a senior analyst with Celent, a financial services consulting firm.

The early adopters tend to be institutions like USAA Federal Savings Bank, which has only one branch but has lots of customers serving in the United States military who don’t want to send money in from an Army base. In fact, the bank has gone a step further and created an iPhone application that allows many of its customers to take pictures of their checks and deposit them that way. One in four of the bank’s check deposits now arrive remotely.

Customers of bigger banks could get their deposits into their bank accounts a lot faster if only the institutions were willing to let them move money this way. So why don’t they?

According to Mr. Meara, 90 percent of all transactions with bank tellers involve checks. If everyone had an iPhone deposit app, people wouldn’t come into the branch as often. That would be fine had banks not invested so much time and energy in training branch workers to persuade checking account customers to move into more profitable products.
“One the one hand, fewer deposit transactions could mean a headcount reduction,” he said. “But it invites the erosion of store profitability. The banks are struggling with the enormity of what it means.”

It can’t hurt to ask your bank for this sort of deposit-at-home service. But Mr. Meara thinks it will be many years before everyone gets to use it. That’s too bad. Until the Federal Reserve acts to tighten the deposit crediting rules further, having more ways to make deposits is one of the best benefits that can still come out of Check 21. If only your bank were in a bigger hurry to give you the tools.


Copyright 2009 The New York Times Company