This year, I have three copies of the boxed version of the H&R Block TaxCut Software: Premium Federal + e-File to giveaway. It’s a $34.95 value.

The TaxCut software is similar to the online version, but it lives on your computer. If you want to be able to work on your return without internet access, this is the option for you. Here are some of the features:

  • Report investments, dividends, retirement income and home sales.
  • Includes videos that help explain specific situations such as home office
    deductions and the Alternative Minimum Tax.
  • Supports Schedule A for itemizing and Schedule C for self-employment.
  • Only from H&R Block: One Ask a Tax Advisor session included. An H&R Block tax
    professional can help answer your tax question via a 1-on-1 phone or e-mail
  • Only from H&R Block: Worry-free Audit Support® offers guidance plus an H&R
    Block enrolled agent to represent you in the event of an audit.

If you have questions about your taxes, especially changes to the tax code included in the stimulus package, check out their Digits community. The information is provided by tax professionals, but in an easy-to-understand format. You can also post questions to the community.

And now for the contest. There are two ways to win. The promotion closes next Friday at 6PM. I will email the winners for their addresses. You’ll have 72 hours to respond, then I’ll contact someone else.

Entry method 1: Subscribe to my feed. You’ll see a two-word phrase in the footer. Email me that phrase at Aryn @ This earns two entries.

Entry method 2: For non-subscribers, you can just post a comment below. This earns one entry.

Note: this isn’t working, so just leave a note in the comments.

Now tell all your friends. I’ve got three copies to giveaway, so there are lots of chances to win!

Yeah, this week’s title was a stretch. So, let’s go right into the three blog carnivals I’m sharing this week.

First up, the Carnival of Personal Finance #193 hosted by Broke Grad Student. In addition to my post about the housing rescue plan, I also recommend Sun’s Financial Diary’s analysis of the plan.

Next up, the Festival of Frugality #166 hosted by Student Scrooge. In addition to my post on the DivaCup, I also recommend Organic Makeup’s post about making organic skin care products from strawberries.

Finally, the Carnival of Everything Money #3 hosted by The Penny Daily. In addition to my recent reading list, I recommend Pimp Your Finance’s post detailing his doubts that consumers have really changed. If they haven’t, they should read more.

If you’ve started digging through the newspaper for grocery coupons or cutting back on going out to save a few bucks, I’m certainly not going to tell you to stop. But I am going to tell you about another place where you could easily save money: subscriptions you don’t really need. How many charges automatically go to your credit card and how many do you really want? Now is a good time to reconsider all your subscriptions.

Magazine Subscriptions
I usually don’t have more than two issues of any magazine around. I subscribe to just enough to get me through a month of gym visits, although I fell behind over the holidays. My husband, on the other hand, has a huge stack of unread magazines. If you don’t read everything you receive, take each one out and take a hard look at it. If you don’t like it, call up right now to cancel before it auto-renews. You may even get a refund for the balance of the subscription.

Internet Subscriptions
You may not even think about all those monthly charges that show up from various websites. Did you accidentally sign up for a recurring subscription? Did you forget to cancel within the free window? Did you stop using the service after a while? If you use it, is it a service you really need? Scour your bill for recurring charges and consider cancelling them.

Cable Subscription
For many people cancelling cable is ridiculous. I would never cancel cable entirely. We have, however, reduced our premium subscriptions. Consider keeping a cable log to see how often you really watch those channels. Is it worth the monthly fee or would it be cheaper to rent the movies/shows on DVD? If you watch mostly network TV, can you cancel cable entirely?

Gym Memberships
If you don’t go more than ten times a month, you’re probably wasting your money. There are many cheaper ways to work out. If you tell yourself that keeping the membership will motivate you to go, think again. Has that motivation worked so far?

Gaming Subscriptions
If you’ve got teenagers, then you probably have gaming subscriptions. They may pitch a fit about cancelling them. If they do, tell them it’s now their responsibility to pay for the subscriptions. It can come out of their allowance or other money they earn, but you shouldn’t be eating all those monthly fees unless you actually use the service.

Cell Phone Subscriptions
I’m not suggesting you get rid of your cell phone. I am suggesting that you take a good look at your bill. Do you need the full data plan? Do you need all those minutes? If you have kids, do they exceed the text-message limit? Consider having them pay for an unlimited plan or making them pay for over-limit texts.

DVD Subscriptions
I love our Blockbuster membership, but I do wonder if we’re getting the full value. We currently get three at a time. In the summer and the holidays, we watch a lot of movies. But during the TV season, we don’t always watch three a week. Figure out how many you rent every month. If you watch three movies a month and have a $20 a month plan, that’s over $6.50 a movie. You’d be better off renting them from a local store or hunting for a Redbox machine. However, if you watch 12 movies a month, then you’re only paying $1.66 a movie – definitely a good deal.

Book or CD Clubs
I’ve been a member of two book clubs. My husband belonged to a CD and a DVD club. We both cancelled our service once we’d fulfilled the requirements. Some publishers also have their own clubs that send you mysteries or romance novels every month. Usually these include books that aren’t sold in stores, or the books are discounted. However, it may not be worth the money if you don’t get around to reading those books.

Newspaper Subscription
Do you read the newspaper every day? For some, the daily paper is still a must. I cut back to Sunday only ($1 a week) a few years ago. Right now, the paper has shrunk so much, that I really only do it for the coupons. I recently noticed that the coupon circulars are delivered to my apartment building in a big bundle. If that continues after we move, I may cancel the Sunday paper altogether.

If you start looking through your bills, I’m sure you’ll find at least a hundred dollars in recurring bills that you could get rid of. Since you don’t really need them in the first place, it’s an easy way to cut back without suffering.

In my head, I’m ready to buy a home. I’ve done some research, I’ve even blogged about it. I’ve made my list of dealbreakers. I’ve attended open houses. But now I’ve reached the stage where it’s time to get real and I find myself filled with fear. The whole process is just so intimidating. It’s not about home prices falling, oddly enough. I’ve made my peace with that. It’s everything else that has me in a dither.

We Qualify for a Big Loan, But Is It Enough?
We qualified for a big mortgage, but in Los Angeles, it’s a little mortgage. I worry that we won’t be able to find something we really like in good condition, with decent closets, and in a good area in our price range.

How to Choose a Realtor?
I have lots of cards for real estate agents, and know the questions to ask, but the process of interviewing them is intimidating to me.

How to Choose a Loan?
We have one loan estimate, but we need to get a few others. How many is enough? Are brokers or banks better? Some say a bank is a better deal, others say a broker is more attentive. Either way, am I tough enough to negotiate all the junk fees I’ve read about?

Should We Pay the Lock Fee?
What if it takes more than two months to find a house? Then we’ll have to pay another lock fee. I worry about throwing away money a few hundred bucks at a time.

How Long Will This Take?
We’ve spent a few Sundays looking at open houses, but we looked quickly and there were only a few that we really liked, and even they had issues. I’m worried about how long we’ll have to look. I know a couple and another friend who have both been looking for five years. I have other friends who found something in two months.

How Much to Offer?
Should I offer 10% below asking? 20% below asking? I know the real estate agent can help me figure that out, but I worry about it all the same. I’m a worrier by nature. And an optimist. It makes for an uncomfortable brain sometimes.

What about Closing Costs?
We’ve saved up about $7,000 in the last three months, but we owe $9,000 in taxes, so come April 15, that money will be gone and we have to start over saving for closing costs. Should we wait a few months to save up closing costs or just bite the bullet and include them in the mortgage? Can I survive another six months in my apartment if we decide to wait? I got up at midnight the other night to bang on my neighbor’s door to stop the noise. I’m not sure I can take much more.

Are We Really Certain About Our Choices?
We’ve settled on a few areas, but even that I’m not 100% certain on. Everything is so spread out in Los Angeles, it’s hard to find one central place that works for all our needs. The same with some of our dealbreakers. Should I really be concerned about those things?

I’m confident that once I start looking for real, I’ll get over some of my fears, but I’m having a hard time taking the next step. At some point I just have to take the leap. So, all you homeowners out there – how did you get over first-time homebuyer jitters? Any advice?

For some people, choosing a tax software package comes down to trust. They want to go with the name they’ve heard of. And that’s fine. Trusting your software is important. For me, it comes down to price. That’s why I prefer a lesser-known software called TaxAct. It’s just as good, just as accurate, and much cheaper.

Of course, free is the cheapest, so find out how to win a boxed copy of the TaxCut software.

H&R Block TaxCut
TaxCut is the leader in the online tax software business. In addition, they still offer in-person tax filing in their office. Their interface is largely the same as last year’s. In addition to the option to file taxes in their office (for an additional fee), they also include their worry-free guarantee. If you fear being audited, that alone may be the deciding factor for you. Here’s a quick cost run-down:

Free Federal Return + Efile
Add 5.95 for instant advice about life advice

Standard – $14.95
This isn’t listed on the homepage. It was only offered when I started the Free return
Includes Worry-Free Audit Support, as do all packages from this point on

Basic – $19.95
Best if you have a straightforward return

Premium – $39.95
Best if you have self-employment income or life changes such as buying a home or having a child

Signature – $79.95
Best if you need live tax advice

For all packages, state returns are an additional $29.95.

TurboTax is owned by Quicken and has also been around for a long time. If you’re a Quicken user, you may appreciate the ability to import your data directly from your software (with paid versions). TurboTax also now offers audit support. Here’s a quick rundown of their options:

Free Federal return

Basic – $14.95
Best if you qualify for the EZ form

Deluxe – $29.95
Best for homeowners with a mortgage or medical expenses

Premier – $49.95
Best if you have capital gains income or rental income

Home & Business – $79.95
Best if you’re a small business owner (sole proprietorship, contractor)

State returns are $29.95 with the free version, $34.95 for the other versions.

TaxAct is by far the cheapest of the three, but it is just a software program, but they don’t offer audit support. Here are their options:

Free Federal return
Limited to 1 life event, but suitable for all types of returns.
State returns are an additional $13.95

Deluxe – $9.95
All life events are available, so choose this option if you had more than one event, like changing jobs and buying a home.
State returns are an additional $7.00

Ultimate – $16.95
The same as Deluxe, but with the state return included automatically.

Free IRS Return
If you know which forms you need and are completely comfortable doing your taxes on your own, then consider the new IRS fillable form options.

State returns are not included, so you may have to do those on paper if your state doesn’t offer a similar program.

For me, it comes down to price, but my dad is an accountant and I’ve been doing my own taxes since I was 16. If you’re not as comfortable filing taxes, then paying more for one of the better known programs may be worth it for you. None of them are bad, and none of them will get you into trouble if you enter the data properly. (If you “forget” to include some income, none of them will protect you.)

I did my taxes with TaxAct in about an hour this weekend. The actually program took about 30 minutes, but I also spent some time pulling together student loan interest documents and business expense records. If we’d had any life changes, it would have taken a bit more time. Unfortunately, we learned that we owe $1,000 more than expected, but we were prepared to owe money, so it wasn’t a huge shock that we underestimated slightly.

Have you used any of the above programs? What’s your preference? Tell me in the comments.

I last posted a budget update in September and our budget has drastically changed ever since then. Not only have we finished paying off a lot of debt, but we’re now managing to put aside around $2500 a month. Sadly, most of that will go towards taxes for last year, but it’s still a nice accomplishment.

We won’t be able to continue it once we buy a house, but for now we’re enjoying feeling flush.So what changed? How did we do it? To find out, we go to the budgets.

September 2008 Budget

Household Budget

Our spending wasn’t out of control, but there was definitely lots of room for improvement.

Specifically, we were spending too much on dining out.

Gas costs were high, but that was outside our control.  My husband was also doing a lot of driving for work, which required a lot of gas expenditures, but we more than made up for it with hefty mileage reimbursements.

In addition the fuel costs, we also both had major maintenance due around that time, which boosted our service costs.

The clothing budget was also on the high side. I was in a wardrobe updating period and he had to get a lot dry cleaning done every two weeks.

February 2009 Budget

February expenses

As you compare the two budgets, you’ll see some striking differences. First, we’ve cut about $500 in spending, even as our total income went up. Where did we see cuts?

1. A big chunk of it was courtesy of lower gas prices. That’s more than a $200 difference! Unfortunately, I don’t expect that particular savings to last. When building our budget for the whole year to figure out what sort of mortgage payment we can afford, we factored in a much higher gas cost than we’re currently paying. It’s one area of the budget we can’t control – we’re at the mercy of OPEC.

2. Our clothing budget went down, and it should continue to do so. My husband’s dress code changed, so we’ll have a small outlay to restock his closet with business casual, but our dry cleaning bill will be drastically reduced.

3. Our dining out costs were cut in half because my husband brought his lunch much more often.

4. Student loans were also down about $90, and we haven’t even paid off the last small loan yet. Most of this reduction is due to decreases in the interest rate. Even though his loans are consolidated, some of loans are adjustable within the consolidation. (I don’t know how Sallie Mae accomplished that, but they did.)

I didn’t include savings in the budget because right now we’re using a month-end savings system. We shunt whatever we have leftover into the savings account, while leaving at least a $750 cushion in the checking account. Sometimes we have to be a little flexible with the day we transfer the savings, such as last month when we had to pay our credit card bill before my husband’s paycheck arrived. We aim to transfer the funds by the end of the first week of the month, and so far it’s worked for us.

How is your budget faring so far? Have you had to make major cuts? Have lower gas prices and interest rates eased the pressure or are you worse off than before? Tell me in the comments.

We’re shaking things up a bit at this week’s blog carnivals. I’m presenting just two carnivals, and one of them is a newcomer to the slate.

So, welcome to the Carnival of Everything Money #2 at the Penny Daily. It’s my first time participating and my post about dropping out of life was an editor’s pick. I also recommend Make Money Easy Online’s guide to finding online work that pays – which may come in handy if you choose to drop out.

Next up, the Carnival of Money Hacks #52 hosted by One Million Bucks. In addition to my post listing 50 ways to cut spending, I also recommend Brilliant Babblings’ rant about entitlement. It may be the motivation you need to really cut spending.

I created an initial list of important books in September, right after the start of the financial collapse. With the economy still moving in reverse, it’s time to update this list with a few more nuggets to help you understand how we got here, figure out how to deal with it, and be a part of the new way forward we can all create. (I’m an optimist. I have to see the silver lining.)

Understanding What Went Wrong
One book returns from the previous list, but I’m also adding a movie and a blog.

The Trillion Dollar Meltdown – It’s a brief (very brief) and easy to read exploration about the recent history of the financial markets. Charles Morris explains how recent deregulation allowed the big investment banks and mortgage companies to spin out of control. It was released about a year ago now and his once dire predictions are actually spot-on.

IOUSA – I reviewed the movie in full about a month ago after it aired on CNN. If you can find a local screening, go see it. If not, watch the 30-minute recap on YouTube. Then gather up your pitchforks and meet me at the halls of Congress to kick some butt.

Planet Money – The fine folks at NPR created this blog that reports news and analysis of the financial collapse, and all related issues. It’s award-winning, easy-to-understand, and fear-inducing.

Dealing with the Aftermath
Frugality is back in style now. Living within your means is back in style, too. If you already live the frugal life, good for you, but it never hurts to get a few more tips. If you need to learn to control your expenses and get your financial house in order, read these books.

The Total Money Makeover – If you’re deep in debt, this is a good place to start. I don’t totally agree with some of his claims and suggestions, but millions of people have followed his advice to baby step their way out of consumer debt. Use that part, and ignore his mortgage advice.

Your Money or Your Life – At this point, this book should be required reading for anyone in credit counseling or anyone at risk of foreclosure or bankruptcy. It should probably be required reading for the whole country. It doesn’t tell you that you can’t spend money. It does teach you how to reconcile your personal values with your personal spending, and to value yourself over your stuff.

Simplify Your Life – If you need to cut back on expenses but a total overhaul of your spending habits isn’t necessary, check out this book for simple tips for reducing your expenses here and there.

Building a New Way Forward
Even though I sometimes drive home thinking that the bad news on the radio is a dream and that we’ll all snap out of it, I know that’s not true. Instead of wishing it away, we can instead see this as an opportunity to rectify our wasteful ways. We can fix our environment and our economy at the same time. Ultimately, the economy will only collapse again if the climate spirals out of control and we return start living beyond our means again.

Hot, Flat, and Crowded – Thomas Friedman looks at how our overspending and overpolluting ways kicked off the global climate crisis. The rest of the world now wants what we have, but getting it the way we did would destroy the planet. He offers careful analysis and suggestions for changing our own ways while we lead the world by example.

Animal, Vegetable, Miracle – Barbara Kingsolver spent a year living off her own farm. We can’t all own farms, but her story of self-sufficiency can inspire the rest of us to be more conscious and frugal in our food choices.

Economics for Dummies – Not only do we all need a basic refresher in economics before we get to the business of fixing our economy, but I think Congress does, too. Like all Dummies books, this is well-researched, well-written, and easy to understand.

These seven books, one blog, and one movie should keep you busy for a while. At worst, you’ll have lots of information to get you through small-talk at cocktail parties. Oh, you don’t go to cocktail parties anymore?

I’m not sure I have the strength to be stabby anymore, but I’ll give it a go with this year’s housing rescue plan. I say this year’s, because last year we saw the Barney Frank plan and apparently a whopping 35 households have taken advantage of it. That’s right, 35. So now we have this new plan, and it puts cash on the table for lenders. We’ll see if that works. First, let me start with something that wasn’t mentioned in the plan that really does make me stabby:

Last week, Fannie and Freddie announced new fees that could grind the housing market to a total halt. They would slap qualified borrowers with high credit scores with an additional 1.5%-3.5% fee just for buying a condo. They would also slap anyone with a credit score under 740 with extra fees if they couldn’t come up with 25-30% down. 30%! These new policies and fees will only make the home buying market worse by penalizing people who are actually qualified to buy a home right now. Fannie and Freddie screwed up. We all know that. But they can’t make up for past failures by penalizing future borrowers! I’ve already written to my Senators. If you plan to buy or sell a home anytime soon, I suggest you do the same.

Housing Rescue Plan Components
This year’s plan (or maybe I should say this month’s) includes a few key elements:

Refinancing. Borrowers who are underwater will be able to refinance to a rate around 5.16% through this program if they have Fannie and Freddie conforming loans. This will reduce their monthly payments, which will hopefully allow them to keep their homes.

Loan Modification. Another portion of the program targets borrowers who are underwater or have high mortgage payment to income ratios. This plan will help those in default or and those who haven’t yet defaulted. It will reduce interest rates and payments down to as low as 31% of income, with government support. The rate is locked for five years, at which time it can step back up to the conforming rate at the time the loan was issued.

Lender Incentives. In addition to government supports, loan servicers and issuers will receive cash bonuses for modifying loans.

Borrower Incentives. Borrowers will also receive mortgage balance reductions of up to $1,000 per year for each of five years they remain current on the loan.

Borrower Counseling. Borrowers with a 55% or higher debt-to-income ratio will be required to receive credit counseling as part of their participation in the program. I like this part.

Guidelines. There will be standardized loan modification guidelines that will clearly spell out the process and qualifications. Imagine that – guidelines!

Bankruptcy Modifications. In certain cases, a bankruptcy judge will be able to treat the difference between the home’s current value and the loan amount as unsecured debt. In some cases, that may allow the judge to eliminate that portion of the debt.

My Thoughts
I have a few thoughts. First, I guess they had to do something, but I’m not sure this will really be effective. If I have a loan for $300,000 and my home is now worth $200,000, what’s my motivation to keep paying even if the interest rate is low? Some people expect to live in their homes forever and will keep paying on the theory that the home will be worth that much eventually. Other people would rather start over a few years from now with a different home and a different loan.

Second, lenders should have started modifying interest rates a long time ago. It shouldn’t take cash incentives to get them to do the right thing. It disgusts me that we’re basically bribing them to modify a loan so they can continue to be paid rather than force a foreclosure.

Third, I’m not thrilled about the bankruptcy portion, for three reasons. 1. If a family can’t afford the payments even after the loan modification, then they probably shouldn’t be in that home at all. 2. What happens when home prices do eventually improve and the home is worth the value of that original mortgage? Who gets to keep the gain that otherwise wouldn’t have existed? 3. If judges can just wipe out a portion of a mortgage whenever home prices drop, what’s the motivation for lenders to issue loans? We have no way of knowing when disaster or a local recession may strike and decimate home values (such as the 1990s base closures).

What do you think of the new housing plan? Do you think it will work? What do you think of the new Fannie and Freddie fees?

Move along, guys. Nothing to see here, unless you find menstruation interesting. Ladies, don’t be grossed out. We all know we have to deal with this, and we all know how expensive and annoying it can be. I’m about to propose a solution to the first part. It helps with the second part, but there’s nothing that can truly resolve the annoyance factor. It’s called the DivaCup, and once you try it, you may never want to go back to pads and tampons again.

What Is A DivaCup?
It’s a small cup made of medical silicone that you use instead of a tampon or pad. You insert it to catch and hold the blood. Then after 8-12 hours (depending on your flow), you empty it, wash it with soap and water, and insert it again. You can sleep in it, exercise in it, swim in it, take a bath in it, etc.

DivaCup Advantages
If you’ve been using pads and tampons, then you’re probably sick of spending $5-10 on them month after month after month. Even if you buy big packs at Costco or Wal-Mart, you’re still shelling out at least $30 a year for these annoyances. And you’re not helping the environment either. The DivaCup is different on so many levels.

It’s Not Disposable. Because it’s medical silicone, it lasts for ten years. Think of it – no more tampons or pads for ten years. That’s 120 months. That’s a savings of $360-$1200! It’s also good for the environment. Other than the box it comes in, there’s no packaging to recycle or throw out. No more cotton and plastic filling the landfills or worse, clogging your toilet. Look at this photo of all the garbage produced by 35-40 years of menstruation.

It’s Cheap. The cup runs about $30. You can buy it at Whole Foods or order it from to get free shipping and avoid sales tax.

It’s Convenient. Because you can wear it for up to 12 hours, you don’t have to worry about changing it at a rest-stop or in an office bathroom. You also don’t have to worry that you don’t have any tampons when your period starts. Just carry it with you when you think you’re cycle is about to start. You also don’t have to worry that everyone else in the office can see you carrying a tampon or your purse to the bathroom. It’s your secret.

It’s Healthier. Inserting chemical-treated cotton into the body can’t be healthy. The cup is cotton-free and chemical-free. Tampons can also disturb your natural pH, while the DivaCup does not. In addition, it may help you notice changes in your flow that you wouldn’t recognize with tampons. Marked increases or decreases can signal a health problem, so this is important information most women don’t have.

DivaCup Disadvantages
There are a couple of disadvantages to the cup:

It Comes in Two Sizes. There’s one size for women who are under 30 and have not given birth, and another for women who are over 30 and/or have given birth. So if you’re 28 and childless, you may need to buy a new one in two years.

You Have to Be Comfortable with Your Body. If you’re squeamish about blood or not comfortable with your genitals, then this isn’t the right option for you. However, this will force you to become comfortable with your body, which is healthier for you in the long-run.

DivaCup Alternatives
In addition to the DivaCup, there are a few other menstrual cups on the market. The Keeper is made from latex rubber. They also offer a MoonCup made of medical silicone. The Lunette is made in Finland and is also medical silicone. It’s a little more difficult for U.S. and Canadian women to get ahold of, but easy for Europeans to find.

If you want to help the environment, your body, and your wallet, consider buying one of these cups. It really will change you life.

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