Personal Finance Digest

FREE LIGHT BULBS FROM DUKE ENERGY: Duke Energy is giving away free CFL light bulbs for some reason. I signed up yesterday and the website informed me that a shipment of 15 light bulbs is headed my way. Duke Energy also has an online store where they sell CFLs and LEDs at a discount, and they actually have some good deals. The offer is only valid for Duke Energy customers, and yes, they verify this before they let you in on the deal.

TRUE TALES FROM A HUMAN GUINEA PIG: Budgets Are Sexy has a “side hustle” series wherein folks tell about their efforts earning money on the side. The most recent installment: volunteering for medical research. Emily from Evolving Personal Finance gives an account of her experience. In a nutshell:

Benefits

1. You get paid well to do non-taxing activities.
2. You may find out useful medical information, as a direct or indirect result of participating.
3. It can be entertaining, interesting, fun, or educational.

Drawbacks

1. You generally can’t complete studies on your own time or at home, so you need to be at the institution for your appointment during or near normal work hours.
2. There is a fairly direct relationship between pay rate and invasive-ness/inconvenience of the study; therefore, if you are unwilling to be administered drugs or poked and prodded, your hourly rate may not make it worthwhile.
3. Being a guinea pig doesn’t exactly build your resume!
4. You won’t be eligible for every study so your pool may be quite small. Not all studies need healthy volunteers, and some specify age ranges, sex, or certain medical histories.

If you want to find studies near you, go here or here.

A STOCK AVAILABLE AT 1X EARNINGS?: Oddball stocks has turned up another interesting company:

First off Anacomp (ANCPA) is not a Chinese company, a reverse merger or anything shady as far as I can tell.  For curious readers the company’s RFP’s are available online, I was able to find some contracts in a government database as well.  The company is simply small and forgotten, trading far on the fringes of the market.

Anacomp is a document management company that’s been in existence for 40 years.  The company’s business is fairly simple, they scan in documents for customers and provide indexing and online document management services.  This is especially important for customers that are paper heavy, such as the government (who happens to be their largest customer.)  The company provides a valuable service in centralizing document digitalization, storage, and retrieval.  Clients can continue to be paper heavy but offer digital copies if necessary.  The company has two locations, one in Washington DC, the other in Southern California.

Find out why Nate’s long on Anacomp here.

INFLATION PREDICTIONS FROM 1982: One of the Smithsonian blogs has unearthed some 30-year-old inflation predictions from the Omni Future Almanac. As always, predictions from long ago are amusing, which is why you should never try to predict anything. Apparently, inflation back then was so high people thought that professional baseball players would be someday be paid several hundred thousand dollars per year. Have a look:

I normally take a break from blogging over the weekend, but circumstances compel me to post. What a pleasant surprise it was this morning to see the following message from Best Buy in my inbox:

There’s a little more info on Best Buy’s home page right now if you’re curious. What all this means for me is 10% back in the form of Best Buy gift certificates (assuming that both my math and Best Buy’s fulfillment processes are correct). How do I get 10%? First of all, you normally get one Reward Zone point back for each dollar spent, and each point is worth 2 cents of Best Buy gift certificates. Triple that and you’re at 6%.

I also get an additional half a point for being Premier Silver (which you get after spending $2,500 at Best Buy in a single Calendar year), plus another point and a half for using my Best Buy credit card. So the two extra points would be worth an additional 4% (these two points are bonus points and are not tripled). But you don’t have to be a Premier Silver or a Best Buy cardholder to make this a good deal–this would be a great way to put some spend on a Starwood card, for example.

Note that if you’re not a Premier Silver, you only get double bonus points, not triple. But then, if you’re not a Premier Silver, promotions like this are a good time to become one. In fact, promotions like this are how I became a Premier Silver in the first place. Double bonus points still gets you 4% plus whatever your credit card rewards are.

Finally, note that as per the fine print, this offer is only good for one purchase, not multiple purchases.

As you have probably heard by now, the Powerball lottery jackpot is pretty big. Any time it gets this big, some people who don’t normally play the lottery start to wonder if buying a lottery ticket might be a good deal.

I’m one of those people. Normally I have no interest in lottery tickets because they’re such a horrible waste of money (unless you can figure out their system, like this guy did). But when the jackpot gets up to $550 million, it’s worth plugging a few numbers into a spreadsheet.

I like the approach taken in this BusinessInsider article, so I’m stealing it. I made a couple of changes.

First, rather than give the stated value of the lottery ($550 million), I’m giving the actual lump-sum payout ($350 million), which is what most people take. The higher number actually represents the total value of annuity payments over many years, and the lump sum is what those payments are worth right now.

Second, since you have to pay taxes on your winnings, I used the after-tax value in my calculations. I only did this for the three highest prizes, as most people won’t bother to pay income taxes on a $7 winning ticket.

Here’s how it looks:

Powerball expected value

So if these calculations are correct, you can expect to lose $.42 out of every $2 ticket. Except it’s worse than that in two ways.

First, the chart does not take into account the probability of sharing the jackpot, and with so many people buying tickets right now, that probability is higher than normal. In fact, lotteries like this actually see diminishing returns to a high jackpot because so many more people than normal are induced to buy tickets.

Second, most of the expected gains are concentrated into the grand prize outcome. The most likely outcome, by far, is to lose everything you spent on the ticket. If you spend $200 to buy 100 tickets, you would expect 97 of them to be losers, and you would expect a total of $12 from the other three, maybe a little more if you’re lucky.

But on the other hand, if you derive $0.42 or more of entertainment from purchasing a ticket, you’re at least breaking even. I would expect diminishing returns to purchases beyond the first ticket.

Therefore, the official Personal Finance Digest recommendation is: buy one ticket–exactly one, no more. Think about all the great things you’d do with a few hundred million, get your $0.42 worth of dreaming done, and then throw the ticket away on Sunday morning after you verify that you’re not the lucky jerk who won the lottery. At least you tried, right?

RETURN OF THE SON OF THE AMEX 75,000 POINT OFFER: The Amex 75K offer which suddenly appeared and then suddenly disappeared has suddenly reappeared, only this time it’s got a higher minimum spend: $10,000. Not amazing, but not bad either. Via The Points Guy, here’s the link. TPG recommends taking a screen shot to ensure that you’ll get the 75,000 offer, and that’s good advice.

AMAZON LAUNCHES AMAZON COINS: Tired of Bitcoin getting all the publicity, Amazon is launching its own currency, Amazon Coins, and is giving away 500 coins–which is their new focus-group-tested way of saying $5–to all Kindle owners. Someday there’s going to be a poorly-executed marketing promotion involving this currency, and some combination of Flyertalk, Fatwallet, and/or Slickdeals will figure out a sweet loophole, and we’re looking forward to that day.

And while we’re on the topic of Amazon, Slickdeals pointed out there are a couple of free books you might want to grab before the price reverts back to normal: The Food Allergy Mama’s Baking Book (normally $20) and Beer is Proof God Loves Us (normally $26).

$5 OFF $50 AT HOME DEPOT: $5 off in-store purchases when you register for their newsletter. (H/T: Slickdeals)

SPIRIT AIRLINES GIVEAWAY: Spirit Airlines is giving away 25,000 miles to the first 1,000 Philadelphians who show up. Since this is Spirit Airlines, the miles expire in 90 days, and it will cost you $3,800 to book a reward ticket and an additional $9,000 for a carry-on bag–but hey, free miles!

Ha!