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Wednesday, March 28, 2018

How To Save Money Equipping Your Kitchen


I think just about everyone knows that eating out is more expensive than making meals yourself. When people try to save money, one of the first things they cut back on is eating out at restaurants. When you go out, you’ll pay $2 to $4 for a soft drink that you can buy for yourself at the store for about a quarter. The actual food has a similar, if not quite so high, markup. It’s easy to justify eating out due to lack of time or lack of cooking knowledge, but over time, those excuses will end up costing you a pretty penny. By spending the time and taking the effort to learn how to cook on your own, you’ll start saving money almost immediately.

Of course, if you are going to cook at home, you need a couple things. Recipes, for one. Luckily, the internet of chock full of those. There are sites for all levels of home cooks – from those just starting out to full blown gourmets. Find a site or two whose recipes sound tasty you and that seem easy to prepare. As you become more adept at cooking, you’ll find yourself naturally looking to expand your skills and start branching out into recipes that match your growing experience.

In addition to recipes, there are a few other things a home cook needs. Pots and pans, for starters. You don’t need a bunch – one frying pan, a couple sauce pans of varying sizes, a big pot or two for making soup or pasta, and perhaps a baking sheet or two (because you have to make cookies). You’ll also want some measuring cups and spoons, a whisk, some wooden or plastic mixing spoons, maybe a pair of tongs. A couple of knives, like a chef’s knife and paring knife would be useful. I would also suggest some food storage containers to store any leftovers.

You’ve got a couple of choices for where to go to pick up these items. You can go to a department store and buy a pre-packaged set of pots and pans. Those tend to be pricey, running in the hundreds of dollars, and the set may contain pieces you don’t need. You could try heading to a lower priced store such as Target. They are OK for smaller items like measuring cups and other accessories. I’d steer clear of any pots and pans they sell though, as they tend to be either cheaply made pieces or brand-name items that cost more simply because they have a well-known name on them.

Shop Where The Professional Chefs Shop

But there is one other place everyone should investigate when they are in the market for new kitchen items: restaurant supply stores. These places are not going to have your big brand names – no Calphalon or Anolon or All-Clad – and that should tell you something. If restaurants and professional chefs can get by without these expensive brands, you likely can too. What you will find at the restaurant supply store are large numbers of items that are workhorses. They will stand up to a lot of abuse, will heat evenly, and, more importantly, will not cost an arm and a leg. And, of course, these places will also sell your measuring cups, food storage containers, knives, and whatever else you may need. Even towels and napkins.

Not only will they have all these items, they will have them at decent prices. The restaurant business is very competitive and margins are not high. Therefore, restaurateurs can’t afford to buy outrageously expensive cookware.

The best thing is almost all restaurants supply stores are open to the public and almost every large city has at least one. Whether you are building your collection from scratch or just want to pick up one item, it’s worth the trip to see what they offer. You do need to be careful. Their selection will be huge and it can be tempting to buy more than you need. Here’s my list of what I think the minimum items every home cook should have.

  • Skillet (frying pan) – At least one twelve inch pan. If you’ve got a few extra bucks, pick up another smaller one – around 6 to 8 inches. The bigger size is good for cooking larger items or a large amount of vegetables. A smaller size of nice for cooking things like eggs. I like the smaller size to be non-stick and the larger one to be not non-stick. You can’t really brown stuff well in a non-stick pan. Look for a lid for the larger size pan. The one you buy may not come with one, but it's likely that a lid from one of the other pots you might be buying could fit on it.
  • Sauce pots – you’ll want a couple of sizes. A small 1 or 1.5 quart pot is good for heating soups or other canned items. A 2.5 to 3.5 quart size works well for homemade soups and sauces. Get lids for these as well.
  • Stock pot – A larger pot, between 6 and 8 quarts, is ideal for making pasta or large batches of homemade soups or broth. (Save your extra vegetable scraps and/or bones in the freezer and when you have enough, make your own stock to freeze for later use.)
  • Knives – At a minimum, you’ll want a large, general purpose chef’s knife, a small paring knife, and a bread knife (a long knife with a serrated edge). There are all sorts of other knives you can get and they can be priced into the hundreds of dollars each, but those three will get you through most recipes. Pick one that feels comfortable in your hand. Look for ones that have a full or partial tang - the part of the knife blade that extends into the handle. A full tang extends all the way to the end of the handle, whereas a partial tang only goes part of the way into the handle. A full tang knife will have better balance in your hand and be more sturdy. A knife without any tang is one where the blade is either glued or crimped onto the handle. These types of knives are flimsy and prone to breaking. As you cook more and more, you’ll come to discover what type of knife feels best in your hand.
    No tang

    Full tang
    Wu-Tang Clan
  • Measuring cups and spoons, mixing spoons, tongs, and other accessories – A good set of measuring cups and spoons is a must. In time, you’ll be able to judge amounts just by eyeballing them, but if you are just starting out, you’ll need to follow the measurements in the recipe. (This is especially true when baking. Most recipes can be fairly forgiving if your ingredient amounts are slightly off, but baked goods require more exact measurements due to the importance of the correct ratios of baking soda, baking powder, or yeast to the other ingredients in order for the finished product to turn out correct.)  Big mixing spoons are useful for mixing (go figure) and plastic ones work well for most liquids. For mixing sturdier things like cookie dough or pancake batter, a wooden spoon works well. Tongs aren’t just used for turning steaks. You can use them for plucking things out of boiling liquid or pulling sheet pans out of the oven. They will become like an extension of your hands.

Some other tips:


  • Non-stick versus “stick”Teflon was the original non-stick cooking surface. In recent years, there have been some health concerns about it and, as a result, other non-stick surfaces have started appearing on cookware. Regardless of what makes a surface non-stick, there are a couple things you should be aware of. First, if any recipes calls for you to brown something, you’ll get better results if you stay away from non-stick surfaces. Second, not every piece of cookware you own needs to be non-stick. Your sauce and stock pots don’t need to be non-stick. It may help when cleaning things, but I generally find the extra expense for non-stick pots to not be worth it. Third, non-stick surfaces are delicate. Don’t use metal utensils in a non-stick pan as they will scrape the coating and ruin the non-stick surface. Use wooden or plastic utensils. For a similar reason, don’t put them in the dishwasher. The tines of the dishwasher rack will rub against the coating and ruin it. I find a non-stick surface best for a small skillet. They are great for cooking eggs. Because the non-stick surface is relatively delicate, don’t spend a lot of money on non-stick cookware. Rather, buy fairly inexpensive, but decent, pieces and just plan on replacing them every 3 or 4 years
  • Material – The cheapest pots and pans you will find will be made of all aluminum. They are lightweight and cheap, but they are also not worth it, so avoid them! Aluminum is a great conductor of heat, so theoretically, it should make great pots and pans. In reality, they don’t because your stove burner, be it gas or electric, does not heat evenly. Some spots will be hotter than others. Because aluminum conducts heat so well, those hot spots are transferred through the pan and to your food, which will cook unevenly. What you want is a 3-ply pan: one layer of aluminum sandwiched between two layers of stainless steel. The steel will help distribute the heat evenly across the pan surface. Of course, aluminum is non-magnetic, so if you have an induction cooktop, all aluminum pans can't get used.
  • Aluminum also reacts to acid, so acidic foods, such as tomato sauces, will pick up a slightly metallic taste if cooked in an aluminum pot or pan.
  • Glass versus metal lids – Choose metal lids. They are cheaper and glass lids get clouded with condensation, so you can’t see through them anyway.
  • Handles – look for handles that are riveted to the pan, not stuck or crimped on. They will last longer and won’t get loose over time. Hollow handles tend to stay cooler than solid ones, but I prefer the heft of a solid metal handle. This is a personal choice.
    Non-riveted handle

    Riveted handle
  • Wood versus plastic utensils – this is mostly a personal choice, but keep in mind what I mentioned earlier about stirring thick mixtures. I find wood performs better in those cases. I've had plastic spoons bend or break. Never put wood utensils in the dishwasher. The harsh detergents and high heat will dry out the wood and cause it to crack and splinter in a relatively short time. If you want to keep your wood utensils and cutting boards in good shape, get some food grade mineral oil and rub them down with it every couple of months or when they start to look dry.
  • Wood versus plastic cutting boards – A lot of people like plastic cutting boards because they can go in the dishwasher and people seem to be paranoid about germs. However, wood has natural anti-microbial properties and, provided you wipe it down after each use, germs should not be a problem. Wood is also more gentle on your knife edges than plastic. (Please, never use a glass cutting board! Those destroy knives.) 
  • If you opt for a wood cutting board, look for one that is “end grain cut,” meaning the cutting surface is comprised of the ends of wood pieces, not the sides. They are made by gluing together a bunch of short wood pieces on end rather than long pieces laying down. This makes for a harder surface, while still playing nice with your knives, and will last longer. Just like with wooden spoons, a little food grade mineral oil applied every so often will keep the board in shape for decades.
  • End Grain Cut
    Not End Grain Cut
  • Storage containers – Don’t spend ridiculous amounts of money on Tupperware or Rubber-Maid containers. Deli takeout containers work just as well and are much cheaper. As a bonus, they are cheap enough so that if they get cracked or stained, you won't feel bad about throwing it out.

Do you have any tips for cookware? Where to buy, what to use? If you have any comments or questions, please leave a comment below.

Wednesday, March 21, 2018

Credit Card Showdown: Costco Visa vs. Chase Freedom

I love my Chase Freedom Visa credit card. I earn 1% cash back on every purchase and 5% cash back from select merchants that change each quarter. There is no annual fee. And now that Costco takes Visa, I can use it there as well.

But the last time I was at Costco, I noticed a sign advertising a Costco branded credit card. These are the details:



Hmm.. That looks intriguing. I spend a fair amount of money at Costco and my Chase Freedom card only gives me 1% cash back there. I could double that with Costco's card. Four percent back on gas purchases sounds promising, as does 3% on restaurant spending. The base 1% on everything else matches the Freedom card's cash back rate. Perhaps it was worth looking at switching..

The Devil Is In The Details

So I checked out the fine print of Costco's card cash back program. The card is offered through Citibank and the terms can be found here. Here's my comparison, based on information obtained on March 14, 2018.

Annual Fee

Neither card has an annual fee. Winner: Tie

Annual Percentage Rate

The Costco card APR is currently 16.49%. This is determined by adding 11.99% to the Prime Rate. Chase Freedom is the same. Note that your actual rate will be determined by your credit score and may be higher. I don't carry a balance, so this isn't a big deal to me. Winner: Tie

Sign Up Bonus

Costco's card does not offer a signup bonus. Freedom offers a $150 credit after you spend $500 in the first 3 months of getting a card. You can earn another $25 by adding a second user to the card and making a charge with that card within the first three months. Winner: Chase Freedom

Reward Program And Reward Redemption

This gets a little complicated.

For the Freedom card, it's relatively straightforward: 1% cash back on all purchases, with no maximum. For selected categories, you earn 5% cash back on the first $1,500 spent in the quarter. After that, the standard 1% rate applies. You must manually activate your increased cash back bonus each quarter to earn it.

The Costco card has four reward categories:

  • 4% cash back on all gas purchases, including gas purchased at Costco, up to $7,000
  • 3% cash back on restaurant and travel purchases, which includes hotels, airfare, car rentals, etc. Purchases from Costco Travel do qualify.
  • 2% cash back on all Costco purchases.
  • 1% cash back on everything else.
If you read the fine print, you'll discover some important exceptions:

  • Bakeries do not count as restaurants, for some reason. Also, some restaurants inside stores will not count. This is typical and understandable. The main store is not categorized as a restaurant, so you will just earn 1% there. Chase Freedom has the same disclaimer for it's quarterly categories.
  • Not all gas stations qualify for 4% cash back. Costco gas stations do, but gas purchased from other warehouse stores, convenience stores, supermarkets, superstores, and non-Costco warehouse stores do NOT qualify. You only earn 1% cash back at those locations.

Chase Freedom rewards can be redeemed each month. They can be redeemed as a statement credit or used to purchase gift cards from select merchants, such as Amazon. Reward points do not expire.

Costco cash back awards are distributed once per year, at the end of your February billing cycle. You receive a certificate than must be redeemed at Costco in a single transaction. If your reward is more than your purchase, you will receive cash back. The certificate expires on December 31 of the year in which it was awarded.

Winner: Chase Freedom, for many reasons.

The restrictions on the 4% gas station rewards make it more or less useless to me. I do buy gas at Costco when I can, but there is not a location convenient to me. Most of my purchases are at the gas station at my local Safeway, which has the cheapest prices outside of Costco. Per the Costco card restrictions, I would not earn 4% there because it is a supermarket. I'd only earn 1%.

The yearly reward redemption, quite frankly, sucks. I don't want to have to wait a year to redeem my rewards. Furthermore, I don't want a paper certificate that I can only use at Costco. Sure, I shop there a lot, but why is paper even still being used? It's just another thing to keep track of or lose. And yes, I can redeem it for cash, but I resent being forced to go to a particular place to redeem it. Chase Freedom offers me the ability to credit my account monthly, online and at my convenience.

Other Requirements

Your Costco membership fee will be automatically charged to your Costco credit card. Additionally, if you cancel your Costco membership, your credit card may be cancelled as well.
 

And the overall winner is....


Chase Freedom.


While Costco typically has good deals on most things, this credit card program just doesn't compete with the Chase Freedom program, both in terms of ability to earn rewards and the ability to redeem them. I'm sticking with Chase Freedom.

Wednesday, March 14, 2018

Tax Day!


Last week was tax day in our house. Not April 15, when taxes are due to be filed, but the day I set aside to gather all my tax-related paperwork and ship it off to my CPA.

Like always, I sat on the floor of the room we use for our home office and starting stacking papers in piles all around me. All W2s go in this pile by my left knee. All 1099 forms go the pile by my right knee. That pile over there is for receipts for charity donations. The pile my dog keeps walking over is for income from my hard money loans. That one under the desk is for gambling winnings and losses. The pile on the chair is for moving expenses.

I put a sticky note on top of each pile identifying what it contains and paperclip each group together. Once I’ve distributed all my paperwork to one pile or another, I sort the piles into an income-related group and a deduction-related group. I put a rubber band around each stack, then another rubber band around both stacks to keep them together and into a large mailing envelope they go, off to the CPA.

My CPA loves that I am so organized. I can’t help it. It’s the engineer in me.

This process could take a lot longer than it does, but I try to do as much as possible during the year. For example, we donate a lot of old clothes and other items to Goodwill. Before I drop them off, I make sure to document everything. I have a spreadsheet where I list each item donated and its value. I also take a picture of the items. (This may be overkill, but I figure if I’m going to get audited, I want as much proof of what I gave away as possible. This also helps document the condition of items in case there is a dispute over the value.) I then print out the spreadsheet and the photos, staple them to the receipt I get when I drop them off, and put that in a folder. When tax day comes, I just take the papers from that folder and hand them over. The work of assigning values and documentation was done throughout the year.

One drawback to having so many different accounts is that, come tax time, I have lots of different 1099 forms to collect. Nothing I can do about that, unfortunately.

In 2017, we had some significant moving expenses to deduct. We also sold our old house and bought a new one. That added to the paperwork this tax season. We also lived in 2 states during 2017. Luckily, Washington state does not have an income tax, so there won’t be any additional work for that, but my accountant will have to file a part time resident tax return for the time we lived in AZ. This will also be complicated because my wife and I moved out of the state at different times. It looks like our CPA will really be earning her fee this year!

The good news is that the recent tax law changes doubled the standard deduction, so it’s highly likely that next year we won’t need to itemize our taxes.

If you are itemizing this year, here’s one tip I used to always forget – you can deduct any taxes you pay when registering your vehicle. Your registration certificate should spell out exactly what portion of your fee was taxes.

Happy taxing!

Wednesday, March 7, 2018

Goal Update: End of February 2018

At the end of each month, I post an update of my goals, including a brief discussion of any notable events that might have occurred during the month. The latest month's figures can always be found under the Featured menu in the menu bar at the top of the blog.

Last updated: End of February, 2018
Current value: $38,086
Change from last Month: -$2,186
Percent of Goal:  35.02%




Note that the funds in this account are invested in stock, so there will be fluctuations in value that are outside my control. I never withdraw money from this account, so any dips are purely due to stock price changes.


Events Of Note Last Month:

Ouch. February hit me pretty hard. The price of my Realty Income stock dropped and handed me a more than $2,000 loss this month - roughly a 5% decline. It wasn't just Realty Income however. The whole stock market had a rough end of February. While the drop in value hurts on an emotional level, I viewed this as a buying opportunity and picked up more shares of O in my Tesla account, as well as purchased some more shares of Vanguard Dividend Appreciation Index (VDAIX), my favorite Vanguard fund, in my IRA account.

My SQL courses on Udemy generated $76.07 of income. Those courses also generated $9.88 on SkillShare.I earned $0.58 in ebook royalties.


Net Worth Update

Our net worth shows a $22,919 decrease this month. That marks two months in a row of a declining net worth. Again, this was mostly due to the stock market tanking.





January 2018
February 2018
























If you have any questions or suggestions for topics, please drop me a line in the comments section!