Tuesday, July 14, 1998

Having Your Budget Tied to an Ant Hill
By George Runkle TMF Runkle

When I was a little boy, I was really into cowboy shows. (OK, I admit it, I'm middle aged.) One typical scene was when the bad guys tied up the poor good guy to an ant hill. Of course, an ant by itself can't do a whole lot more than give you an annoying bite, but get a bunch of those little suckers, and you're eaten away. Naturally, Our Hero was always saved dramatically, but still the thought is kind of scary.

Now today, in Pittsburgh at least, I rarely have to worry about getting tied to a real ant hill. However, there are other little ants out there that do a number on my budget. We all know that eating out is more expensive than eating in. And it's obvious that high-priced toys such as boats, motorcycles, and scuba equipment are budget busters. On the other hand, have you ever noticed how the little ants in the budget eat up all your money?

One little nasty species of ant is the extended warranty. Every time you buy a TV, stereo, or computer, the salesman tries to sell you an extended warranty. Of course, if you don't get it, your teeth will fall out, your spouse will leave you, and your children will become ax murderers. You get thrown an immense amount of guilt that would put many of my more guilt-inducing relatives to shame. Let's look at one warranty I bought. I paid $210 for an extended warranty on my computer. It's for two years and covers everything. Good deal isn't it? Uh... no. What's the most expensive thing that goes wrong with a computer? The monitor? $300. The hard disk? $300. So, I gambled $210 to save $90. That ant bit rather hard. I think it's one of those big black ones that used to bite us in Dr. McDonald's yard when I was little. Of course, in those days I deserved it; I used to kick over their ant hills, which tends to make them a tad angry.

The ants keep marching in. Buy Coke in the machine rather than in the grocery store? You pay about twice the cost. Another ant is auto maintenance. We all know that oil changes are good for your car. So are lube jobs, etc. However, they are commodity items. Getting the Super Duper 3,000 mile Service from your car dealer instead of the local lube place may cost you an extra $20 to $40. Not only that, you lose the car all day instead of waiting twenty or thirty minutes. That ant climbed clear up your leg to get you. Commodity items like that are, well, commodities and should be bought where cheapest. Phone service is another example. It used to be, when long-distance service first became a choice, getting connected could be rather difficult. Today, try to figure the difference in your phone service whether provided by MCI, AT&T, Sprint, or any other provider.

Other particularly vicious ants are the insurance ones. Nobody wants to be wiped out, or leave our loved ones nothing but debts when we die. So, we do need insurance. However, why get a policy to cover your car loan? You can simply factor that into your term life insurance needs. Oh, and do you really want to pay the extra bucks for "permanent" insurance? The insurance guys say it's a good deal, but I'm not convinced. We can go on and on with that.

There are, of course, the less painful ants that add up to do damage nevertheless. Paying a higher price per gallon for gasoline is one. Buying food in convenience stores is an obvious source of ants. Some of the more insidious little critters are utility costs. Do you keep cranking up the thermostat in the winter? Do you leave your windows open while the air conditioner runs? Is there enough light in your bathroom to land a 747? This adds up. Let us not forget calling on the cell-phone. It may be pleasant to spend rush hour chatting with your friends, but it costs money each time and it adds up.

So, to avoid being tied to a modern day ant hill, it's important to watch those minor little expenses that will pretty much eat you alive. Unlike our cowboy in those Westerns on TV, there will be no good guy to ride in from the horizon to untie you in the nick of time. The result can be quite painful.

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