It’s mid-February and my taxes are already done. Not only are they done, but I’m actually getting money back, which came as a surprise. Part of that is because I used free online software to prepare my taxes. The services found deductions that I might have missed. This year, it took me twice as long to prepare my taxes – two hours instead of one – because I used two services as a comparison. More details on that tomorrow. Today, I focus on how filing taxes online saves money.

Remember, even if you don’t owe taxes, you must file a return this year in order to qualify for the tax rebate being provided by the government this summer.

File Taxes Online Free with the IRS
The simplest way to file federal taxes online is to go to the IRS website and click the Free File button. If you owe taxes and adjusted gross income was less than $54,000 this year, then this system is for you. Unfortunately, this system is not currently available for those filers who don’t actually make enough to owe taxes but need to file for the rebate. Check back in early April to see if it’s available then. Or you could file form 1040A on paper now. Personally, I’d give the IRS a little more time to update the software before resorting to paper.

File Taxes Online Free with Other Services
If you don’t qualify for the IRS free file program, review their list of e-file partners. Several offer free federal e-filing, although they do charge for the state. Go down the list and click through to view the offers. Spend a little extra time at each site to see if there are other offers that don’t appear on the splash page. For example, TaxAct show their fee-options on the splash page, but if you click over to the main page, you’ll find the free option.

The IRS Free File program doesn’t complete state taxes. If you live in an income tax state, check with your local tax board to see if they have free online tax software. If not, you can paper file in your state or pay to use the software.

Compare Prices and Pay to File
California is an income tax state and a complicated one at that, so I use the pay software to also complete my return. However, I don’t use the most expensive service. When it comes to these services, they’re generally equal (as you’ll see tomorrow), but their prices are not. I would look for a reasonable offer from a robust site and use that one. If you’re concerned that it won’t be up to the task, you can usually use the software without paying. Prepare your taxes once on the cheap site and once on the expensive site. If the returns are the same, use the cheaper option.

Use the Same Service Annually to Save Time
As a bonus time saver, use the same service every year. If you’ve used them in the past, the system will copy over your old information. So, if you haven’t moved, changed employers, or changed your dependents, you can simply click to confirm that information is still accurate and then enter new wage and withholding information. If your information has changed, updating it is simple.

Run Through the Deluxe Q&As
Some services provide tax Q&A screens if you’ve had major life events. I’ll show you more on that tomorrow, but it’s always worthwhile to check the boxes for your major changes and run through the questions. You may discover that you’re owed deductions or credits you wouldn’t otherwise be aware of. Common deductions include medical costs, moving expenses, excess social security deposits, adoption fees, and more.

Avoid an Audit
Finally, these services help you avoid an audit by checking your return for errors and flags. Now, this doesn’t save you money directly, but you will have to miss time at work and travel to an IRS office if you do get flagged for an audit. The screens reduce your chances of being flagged for an audit, unless of course you lie on your taxes.

Never Accept a Refund Anticipation Loan
Refund anticipation loans are rip-offs of the same order as payday loans. When you file online and use direct deposit, your refund will appear in your bank account within five to fourteen days. In some cases, it can take that long for the anticipation loan application to process, and you’ll have to pay additional fees and interest on that loan. Even if you get approved immediately, you still have to pay exorbitant fees of $30-90, plus interest of 178-700%.

Filing taxes is never fun, but with online software it almost feels that way. I love watching that little refund number in the corner go from red to green. This year it meant that we paid almost exactly the right amount in withholding, which means we didn’t loan the government much money. That’s the best savings of all!

This month, the Money Blog Network’s group project is budgets. I’m not in the MBN, but I’ve decided to post a blog about my method for creating a cash flow budget. It’s far more effective for my husband and me than a traditional category-based budget. MBN lists several other budget posts on their site, if you want to test a few different budgeting, and anti-budgeting, methods.

The Monthly Budget by Category
My husband and I use Quicken to track our daily spending. About once a year, my husband and I run out a Quicken budget, just to see how our actually monthly category spending has changed. Then we copy it into Excel so we can play with the numbers: how much more we would have if we paid off this loan or reduced that expense.

This is an example of what that would look like. If I were studying this, I would see that I could cut the dining budget and might consider reducing utilities expenses if possible.

Sample Monthly Budget by Category

The monthly budget is a helpful way to get an idea of how and where we spend money on average, but it isn’t necessarily useful for planning our monthly cash flow. The budget averages out our expenses rather than showing the blips as they actually occur. For example, auto-insurance isn’t paid monthly, but it appears that way in a budget. We have to plan for the blips, not the even keel budget. Instead of a line-item budget, we use a cash flow statement to plan our monthly bills and spending.

The Cash Flow Budget
The cash flow budget is a much better picture of our expected income and expenses for the month. These are actual bills we must pay, rather than categories that may vary every month. For example, if it’s an auto insurance month, then we know to reduce our spending in other areas to make up the difference. It also helps us plan our debt repayment because we know how much we’ll have leftover at the end of the month.

This is a sample of a cash flow budget for February. You’ll note that the numbers above don’t match the numbers here. There are two reasons: 1. I made many of the numbers up, and 2. Most of our recurring charges (utilities, cell phone, gym, etc.) are on one of the credit cards, so we don’t pay them as a separate monthly bill through our checking account.

Expected bills with variable due dates (like a bi-monthly utility) go at the bottom because we know they’re coming at some point, but not when.

At the beginning of the month, we look at our Quicken account balances for variable bills like credit cards and ballpark the payment amounts in our cash flow chart. We adjust with exact figures as the month proceeds and the bills come in. At the end of the month, we take the end number and add it to our debt payments for the next month. Once our debts are gone (except some student loans), that end number will go towards other goals like savings or investments.

In addition, it helps us see where the bills fall in relation to our income. For example, if we plan to make a big credit card payment, but know that the deposit that covers it doesn’t occur until two days later, we can reduce the payment. Then we can schedule another payment after the deposit.

Creating a Cash Flow Budget
If you want to create a cash flow budget, follow these simple steps:

  1. Get out your checkbook register.
  2. Create an excel chart with payment dates and amounts for all expenses for the last six months. Rather than the generic terms I use above, use the names of the payments, like Amex, Discover, and Sallie Mae.
  3. Use three columns for each month like in the above chart. We go across the sheet for each new month rather than down so several months fit on the screen at once. Although you’ll have to tweak it as time progresses, this gives you a good overview of when your various bills are due.
  4. Just before each month, review the expected expenses for that month and make adjustments for changes in your finances. Also review the previous month and carryover any remaining balance to the next month.
  5. At the end of the sixth month, copy the last month over to new columns and update the dates and amounts for month seven.

Once you get used to this system, you’ll probably find that you feel more comfortable with your finances because you always have a snapshot view of them. It doesn’t require special software and no one else has access to your data. If you don’t have Excel, you can use an OpenOffice or GoogleDocs spreadsheet, instead. This is very different from the system I used when I was single, but I much prefer it. Give it a try, you might like it!

One of the search terms used to reach this blog was “pay off debt or save for house,” which got me to thinking. If you don’t have someone to help you with the down payment, is it better to pay off debt or save for a house?I think it depends on the type of debt, the amount of debt you have, your income, and your target home price.

Type of Debt: If you have credit card debt or other high rate debts, you must pay those off before you can do anything else. Lenders frown highly on those debts when considering how large of a loan to give you. Not to mention that you’re just throwing away money by continuing to pay that interest. The most you can expect to earn on a savings account – which is where short-term house savings should be – is around 4%. That number could continue to drop if the Fed rate is cut further. If you save your money instead of paying off a credit card at 15%, you’re losing more than 10%.

On the other hand, if you have low-rate student loans (below 6%), then you should save for a house instead of pushing to pay them off. Student loans are considered good debt, so lenders look upon them more favorably. In addition, much of the time you can earn a better return on investments. And finally, those loans can be deferred or put into forbearance if times get tough. I plan to pay off our credit cards and two student loans before we attempt to get a loan, but we won’t wait to pay off our entire student loan balance because we have two graduate degrees between us and a lot of student debt.

Debt Total: Of course there is an exception to this policy. If you have a large amount of debt, say more than 30% of your income goes to debt repayment of any kind, then you need to start paying down debt. These days, most lenders will not issue a loan that will bring you above the 43% debt-to-income ratio unless you have a very high income potential (e.g. you’re a surgeon with medical school loans). So, even if your loans are low-rate, pay down the principal until your debt payments and expected housing payments are less than 43% of your income. With the new underwriting standards, more lenders are pushing for DTIRs of 36% or lower if you want the best rate. The higher your DTIR, the larger the down payment you’ll be asked to put down.

Income: Another exception occurs when your income is higher than the amount you need to pay down debt and save for a house. In this case, you can either spend a few months shoveling all the money you can into your debt, or you can split your goals and pay towards each. I would choose the former, but the latter would also provide you with a nice emergency fund while you save for a house.

Target House Price: Again, this goes to your debt-to-income ratio. In Los Angeles, home prices have now fallen to December 2004 levels, but that was near our peak, so they still have further to fall. If you live in a state like California where home prices are outrageous, then you need to work harder to pay down your debt so your debt-to-income ratio is manageable. It’s ideal to be below 33% DTIR total, with 28% max going towards housing. That may be nearly impossible for first-time buyers in California and other high-value states, but it’s a goal to work towards.

There’s no one right answer to the question, but once you consider your situation in light of the following factors, I think the best answer will be pretty clear.

This week we’re offering a special deal: three blog carnivals for the price of one admission. There’s no need to choose, your ticket is good for all of them.

First up, the Carnival of Personal Finance #139. In addition to my post on saving money on books , you’ll enjoy BeingFrugal.net’s post on Seven Things Women Wish Men Knew About Money.

Next up, the Festival of Frugality #112. In addition to my post on saving money on college books, you’ll enjoy Cheap Healthy Good’s grocery shopping tips.

Finally, a new entry to our carnival circuit: the Cavalcade of Risk #45. In addition to my post on life insurance for children, you’ll enjoy the Digerati Life’s analysis of whether cheaper goods and lower prices put us at risk.

Yesterday I regaled you with tales of my love for freezing food. I covered the necessary tools and methods for freezing meat. Today I focus on bread, sauces, and herbs. I’ll also give you a list of freezer storage times and tell you what not to freeze. Then you, too, might join me in my ode to the freezer.

Freezing Bread and Cookies
Freezing bread is easy – and a great way to keep it fresh. I find that refrigerating bread dries out, but the freezer maintains the moisture. If you freeze a lot of grocery store bakery bread, Consumerist recommends buying it frozen from the store because they receive it frozen, not fresh. That might explain why it always seems to be hard at my store.

When I buy fresh bread, or bake bread, I freeze it in the original bags, foil and plastic wrap, or freezer bags, depending on the size and how long I’ll be storing it.

For a homemade pizza crust, I wait for it to cool and then wrap it in plastic wrap. Then I wrap foil around it, too. It keeps this way for about six weeks or so. To defrost it, just take it out of the freezer and remove the wrapping. It should be defrosted in less than an hour, depending on the thickness of the crust.

Buns and rolls also defrost quickly – less than thirty minutes on the counter. You can defrost them faster by wrapping them in a paper towel and microwaving them on defrost for a few minutes. Defrost one minute at a time to ensure they don’t start to cook. I usually just use the manufacturer or store bags because we use them quickly.

One caveat for freezing loaves of bread – if you plan to use it a few slices at a time, slice it before you freeze it. If you’re not sure, slice it into smaller chunks so you can defrost it a little at a time. Sawing slices off a frozen loaf is no easy task.

I only eat one cookie a day, but I make them in big batches. I toss them in a big freezer bag when they’re cool, and take them out a week at a time. It takes me about 6 weeks to go through a batch. I know other people who flash freeze balls of dough and cook it fresh, but I don’t want to deal with cookie sheets and the oven every week.

Freezing Fresh Herbs and Fruit

The top shelf of my freezer is for herbs, sauces, frozen fruit, and stock. You can easily freeze all of the above and have them on hand for later. In fact, Trader Joe’s now sells small packs of frozen fresh herbs you can drop right into your dish. I use their basil and oregano. I also freeze herbs myself.

sage in freezer tray

When I get fresh herbs from a friend or when I buy it fresh from the store (I don’t have a garden), I freeze the excess. Those little packs are pricey – there’s no reason to waste them. Simply clean them, chop them, and then place them in an ice cube tray. Add a little water to lock them in place, and then freeze for a couple hours. When you’re done, you’ll have perfect little cubes you can stick in a Ziploc bag. They’ll keep for a few months, too. The best way to defrost them is straight into the dish you’re cooking, you could also defrost them in a bowl, strain out the water, and then pat them dry with a paper towel.

If you like fresh produce and want to freeze it yourself lay it out on a sheet pan and then freeze it. You may not want to eat them by themselves later, because freezing robs some fruits of their texture, but they’re great in sauces, toppings, shakes, and desserts. No one will know the difference!

Freezing Sauces and Stocks

Top Shelf of the Freezer

I also have frozen cubes of homemade marinara, chicken stock, beef stock, diced tomatoes, and tomato paste in the freezer. Again, I just fill ice cube trays and freeze them. Then I transfer them to labeled freezer bags. Each cube is 2 tablespoons, so 2 cubes equal one quarter cup. I just place them in the pan while cooking to defrost them whenever I need them.

How Long Frozen Food Keeps
The USDA provides the following chart of freezer storage times:

freezer storage times chart

Although you can push it, try to stay within the guidelines to avoid freezer burn. Freezer burn doesn’t poison the food, but it does ruin taste and texture.

What Not to Freeze
You can freeze just about anything, except eggs, mayo, and a few other dairy products. Butter freezes well, but cream doesn’t. The Egg Board says egg yolks and whites can be frozen, but you have to take a few extra steps that don’t seem worth it. I’ll stick to fresh eggs in shells. Very watery produce also doesn’t freeze well, like lettuce. It’s best to use that fresh.

Once you’ve got the hang of the freezer, you’ll become a freezer addict like me. It’s so nice to be able to whip open the freezer and grab just the right amount of stock or herbs. No mixing, no measuring, no fuss. Oh freezer, I do love thee.

Oh, freezer, how do I love thee? Let me count the ways. I love you for your depth, for your ability to preserve raw materials, for your easy storage options, for your ability to save money and food.

I’ve always been a fan of the freezer, but now that I prepare most food from scratch, I’ve really gotten into freezing food. I usually freeze meal components that I can defrost later to make a fresh, homemade meal without losing a lot of food to rot. I don’t do freezer cooking, or meals for a month, because I don’t have room and I like to try new dishes often.

In order to be successful at freezing food, you need a few key things:

  • The right tools
  • Knowledge of how to freeze food
  • Knowledge of how long frozen foods keep
  • Menu planning

Today I’ll cover the tools and freezing meat. Tomorrow I’ll post on freezing stock, sauces, produce, and desserts, how long frozen food keeps, and what not to freeze.

Tools for Freezing Food

In order to successfully freeze food, you need several tools to ensure that you freeze it properly, know what’s in the freezer, and know how long it’s been there.

You’ll need:

  • Sheet pans in a couple sizes
  • Resealable freezer bags – quart and gallon
  • Masking tape
  • Fine point Sharpie
  • Ice cube trays
  • Parchment paper

With those tools, you can begin to explore the joys of freezing food. A note on the resealable bags: I’ve tried both the store brand and the Ziploc brand and I found that the Ziploc really is better. It seals better and is less prone to leaks. If you want to be frugal, you can wash and reuse them a few times. I recommend watching the newspaper for coupons and the store for a sale and then combining the two. With that method, you can usually get the Ziplocs for same price or less than the store brand price.

Freezing Meat

I buy chicken and most fish already frozen from Trader Joe’s. They employ a method called “quick freezing” which freezes them in individual pieces to lock in freshness. Once I get them home, I’ll divide the fish into smaller bags, enough for one meal in each one. The chicken comes in a large resealable bag, so I just toss that in the freezer and remove the pieces as I need them. For meat I buy fresh, like ground beef or chops, I’ll divide the package up before I freeze it for easier defrosting and portion control.

Meat Shelf of the Freezer

As you can see, I have several packages of meat of several varieties. I note the date, food, and weight on each package with a Sharpie (label the bag before you put in the food or the ink won’t stick.) Then I use each meat within three months of putting it in the freezer. Each week, I first check the freezer to see what I have on hand that needs to be used, then I begin my menu planning and grocery list.

You can freeze just about any meat, including bacon. I used to wrap a few slices of bacon in foil and freeze the packages, then I discovered flat freezing. Simply cover a baking sheet in parchment paper (wax paper gets too wet) and arrange the bacon in a single layer. Set in the freezer for a couple of hours, and then place the frozen slices in a resealable Ziploc. It defrosts in a flash. I usually just cook it from frozen.

You can do the same for hamburger patties, meatballs, and other prepared meats. Because they’re frozen before you put them in a freezer bag, they won’t stick together. I usually freeze meat raw and then cook it after it’s defrosted to preserve flavor.

You can use the packages fresh meat came in if you’re only freezing it for a few days (for example, if you bought it Saturday and aren’t using it until Friday), but you should transfer it to a freezer bag for longer storage. Plastic trays and wrap from the store isn’t designed for long-term storage and won’t protect the food. They also take up a lot of space.

Be sure to come back tomorrow for more freezer tips!

There are two kinds of personal loans – the loans you receive from banks and the loans you receive from individuals. For most people, personal loans from individuals take the form of family loans, but they can also be fraught with tension. Now, you can also give or receive personal loans to people you don’t know. Prosper and the Lending Club are two of the top sources for personal loans. Virgin Money is the leader in the field of family loans.

Prosper Personal Loans
Prosper is a loan servicer that facilitates personal and small business loans between strangers. Borrowers receive a lower interest rate than you would from a bank or credit card company. You can borrow up to $25,000 for debt consolidation, a car, a business, or almost any other purpose. You create a loan proposal and then individuals bid to fund it. You make the payments to Prosper, which then distributes the proceeds. According to Prosper, they have an average annual rate of return of 6.18% to 8.52% and a default rate of 1.44%. They have been in operation since February 2006 and have issued 5,427 loans.

Borrowers undergo thorough credit checks and must adhere to lending standards. Prosper then rates the loans from AA to HR. The lower the rating, the higher the interest rate and rate of return.

For investors, the upside is the chance to help someone while also receiving a high return on their money. You can spread your risk by loaning small amounts to a variety of people rather than a large amount to one person. The downside is that there is no guarantee the loan will be repaid. The same could be said of a stock market investment, though.

For borrowers, the upside is the lower interest rate you pay. You also receive the loan anonymously, so your friends and relatives don’t have to know about your debt. The downside is that you only have up to three years to pay it back. With credit cards, you could probably spend forever paying it off and your creditor would be happy to let you do just that.

Lending Club Personal Loans
The Lending Club is very similar to Prosper. The risks are the same. They claim an average rate of return of 12.38%. Their default rate is 0.0%. However, they have only been making loans since May 2007 and have only issued 928 loans.

Lending Club requires borrowers to have a minimum credit score of 640. Based on the borrower’s credit history, the loan is rated A through G, with A loans receiving lower interest rates and having less risk.

The upsides and downsides are the same as they are for Prosper.

Virgin Money Family Loans
Virgin Money is owned by Virgin, but was formally an independent company known as CircleLending. Rather than manage loans between strangers, they facilitate loans between friends and family members. In addition to personal loans, they also manage mortgage loans and student loans. These are true family loans, which means everyone knows everyone.

The old adage says that you shouldn’t lend money to friends and family members, yet thousands of people do every year. Parents loan to children, uncles loan to nieces and nephews, friends loan to friends. Many of those loans lead to strife because the lender sees the borrower spending money and wonders why their loan wasn’t repaid instead.

Virgin Money’s goal is to take the stress out of family loans. You choose the interest rate and the payment schedule, and they complete the paperwork and tax documents. They can also service the loan for an additional fee. They do recommend adhering to the Applicable Federal Rate (currently 3.18%) for loans over $10,000 in order to avoid having the funds classified as a gift by the IRS, but you can choose a rate of 0%.

The downside is that you’re introducing a third party into a family or friendship. For business investments between friends and family members, this is probably a great idea because it confirms the business relationship. I don’t know if my parents would have wanted to use a service like this to loan me college funds (which they later forgave.) They’ve also said they’ll help my husband and me with our down payment, but we don’t want to have strict repayment terms governing those funds. We expect to pay it back, but we don’t know when and we don’t know how quickly.

The other downside is the loan fee. Virgin Money charges fees ranging from $99 to $2499 depending on the type of loan and level of servicing. Depending on the size of the loan, that could be a substantial cost.

Personally, I might consider Prosper or Lending Club for investment purposes, but my relationship with my parents is good enough that I wouldn’t want to involve Virgin Money in the family loan process.

Every few months there’s a new story about unclaimed property. News crews travel to public places armed with computers and help people find thousands of dollars of unclaimed property. Fortunately, you can find your property yourself without paying fees to anyone else or waiting for a news crew to happen by.

What Is Unclaimed Property?

For the most part, unclaimed property is money you are owed, but payer had an invalid address. Often you’ll see old stock dividends, insurance settlements, and lost paychecks. The property may be listed under your maiden name if you’re married. It could also be the remnants of a childhood bank account that wasn’t closed before you moved. Banks are supposed to try to find you, but most don’t put much effort into it.

After an allotted amount of time, three years in California, the bank or other institution turns the funds over to the state, which then has use of the funds until you claim it. They are required to pay interest though, so it’s worth claiming even if the original property was $20 20 years ago.

Many people are startled to find that their safe deposit boxes listed in unclaimed property databases. If you don’t visit your bank or have communication with them in regards to the box for three years, they will break it open, sell the contents, and give the proceeds to the state. Due to a lawsuit, the practice is currently halted in California, but may continue in other states. If you have heirlooms or other irreplaceable property in the box, make sure you stay in touch with the bank.

How to Find Unclaimed Property
You can find unclaimed property easily online. First start with the National Association of Unclaimed Property Administrators. They can search the unclaimed databases for nearly 40 states. They have links and contact information for unclaimed property departments in the non-participating states and territories, which are:

Arkansas
California
Connecticut
Delaware
Georgia
Hawaii
Illinois
Indiana
New Mexico
New York
Oregon
Wyoming

Rhode Island is pending. Use the addresses on the site to write to the unclaimed property offices in Guam and the U.S. Virgin Islands.

Whether you use the NAUPA site or the state links above, start by searching for your full name and then expand out from there. Some debts are listed only by last name and first initial.

If you think a tax refund is missing, you can search for it through the Where’s My Refund tool on the IRS website.

Avoid Unclaimed Property Services
Years ago when the California site first went online, my boss’s old friend alerted him to the existence of some funds and I did the paperwork to reclaim it. My boss then received a notice from an unclaimed property service about an even larger sum in another state. I argued that we could have found the same information ourselves and therefore owed them nothing, but he felt an obligation to use them. The cost was 30% of the found amount, a rather significant sum in this case.

If you receive a notice, don’t contact the service. Instead go online and find the money yourself. Anyone can do a search for anyone, so you may want to perform searches for older relatives who are more likely to agree to a service’s hefty fees. In my boss’s case, he had to track down proof of his former address and submit it to the service, which then filled out a piece of paper and submitted it. We did all the legwork and they got money for nothing.

I don’t know if it’s fortunate or unfortunate, but I’ve never located unclaimed property for myself. I check once a year just to be safe though. You never know when money might go missing!

After a few days of tousling over a much larger package, the Senate has passed the economic stimulus bill passed by the House. There are a few differences that will be ironed out over the next few days and then the bill will be sent to the President for his signature. He’s already said he’ll sign it. Previously, the IRS said it would take them several weeks to start printing the checks because they’re in the midst of tax season, however they expect to be able to distribute the funds faster this time. Most people can expect to receive checks or direct deposits starting in May.

Most blog readers will know this, but you may want to warn elderly relatives to ignore the tax rebate scams already underway. Under no circumstances should they reveal personal information in order to get their rebates.

Yesterday I reviewed strategies for saving money on personal books. As a recent grad student, I also have several strategies for saving money on college books. These are my top methods, but you can also use sources like on-campus exchanges, off-campus exchanges, and Craigslist to find books.

Request Books from the Library
Years ago, I was contracted to write a how-to book. It was an area I had expertise in, but I needed to heavily research some side topics and related history. I’m fortunate to live in Los Angeles, which means I can search the massive LAPL catalog online and request that any book not in the reserve section be sent to my nearest branch. I ordered and checked out 40 books. By tracking due dates online, renewing online, and scheduling regular trips, I avoided any late fees. I believe I spent a total of $12 on books to research that project.

If you have access to a college library, you’re in even better shape. Most college libraries are more extensive than public libraries. In addition to a massive print collection of obscure academic titles, my school had some books available electronically, either directly through my library or through their associations with other university libraries. They can also borrow print books from many other major universities, so you can find almost any book you need. There may be a fee for undergrads, so you may want to ask your professor to order it if you really need it for a big project. If you don’t know how to find these resources in your library, ask the librarian in the reference section for help. They’re more than happy to show you how to find what you need or help you track down alternative sources.

Buy College Texts Online
Half.com is an excellent way to save money on books for students, especially humanities students. You can often get them from the library, but I preferred to own them so I could mark up relevant passages. Nothing angers me more than checking a book out of the library and discovering that someone has written in it. I found that most books from Half.com weren’t written in. If they were, the description indicated that.

I’ve also found some science textbooks in the used section of Amazon and Half.com. Here’s a little known fact about the real reason textbooks cost so much: updated editions. Publishers will release an updated edition with only a few changes, but it forces many students to buy books new. For most majors, you can probably use a textbook that’s a few years older and get the same information for much less. Shakespeare’s words haven’t changed in 400 years. There’s no reason to buy the brand new, updated compendium when you can get one a few years older for less. Obviously, some majors like computer science might require new texts because of the frequency of important changes. If you’re not sure, ask your professor if the older edition still applies.

Some textbooks are also bundled with workbooks, CDs, or software that you’ll never use. Unless your professor specifies that you need them, buy a copy without the extras and you’ll save serious dough.

The key to this strategy is ordering ahead so you have the books on the first day of class. Here’s how I did that:

  1. Check the online synopsis, if available, 3-4 weeks before the class starts. Note titles, authors, edition numbers, and whether the book is required or optional
  2. Check the online college bookstore for the book list. Note the above information and the ISBN number.
  3. Search Amazon and Half by ISBN number for the required list and decide whether you want the optional books. See if you can find all the books you need from just a few different sellers to reduce shipping costs. In most cases, you can buy the books cheaper online, but if you only need a few, it may be worth it to stop by the school bookstore a few weeks before class and buy the best used copies there.
  4. Factor in shipping and tax (where applicable) when comparing the online and campus bookstore costs, then go to the cheaper place.
  5. If you’re buying online, order the books at least two weeks before class starts to ensure they reach you in time.

Access Free Books Online
If you’re really strapped for cash, look for public domain books online. The biggest source is Project Gutenberg. They offer over 17,000 ebooks (pre-1900 mostly, but some early 1900s texts have now fallen out of copyright). You can also Google the title to find all free online sources. I’ve also used this for poems and short stories where I didn’t want to buy a whole book for just three poems or one story. Author society websites (e.g. the Jane Austen society), academic websites, and fan websites are good places to start.

Using these strategies, I spent no money on research texts for various papers and projects during my grad school career. In preparation for my comprehensive exam, I spent about $100 on 40 books. Once the exam was over, I resold most of them and earned back most of what I’d spent. I probably spent around $50-100 per semester on books, but I was able to resell most of them for nearly what I paid for them.

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