Monthly Archives: December 2014

ICE Can Save Lives – In Case of Emergency

ICE Can Save Lives

ICE.pngEveryone knows that ice can make a drink cool or reduce swelling, but if you put it on your cell phone, it might just save your life.

The concept is simple.  Make a contact record in your address book with the name “ICE”, which stands for In Case of Emergency.  In the note section of the record, you would list your name, blood type and medical conditions along with prescriptions and physicians.  You’d also list the people and their phone numbers that can be contacted in case of an emergency.

Several years ago, a British first responder came up with the idea when his emergency unit responded to a call where the victim was unable to communicate due to illness or trauma.  The victim’s wallet didn’t indicate specific persons to be notified in an emergency.  The fireman went through his cell phone to try to identify a relative and wasn’t successful.

That’s when he came up with the idea of a universal entry into the address book for ICE where the necessary parties and special information could be kept.  The story received a considerable amount of publicity and spread across the pond to the United States and into many other countries.

While it isn’t recognized everywhere, it is becoming increasingly more popular.  Even if emergency technicians didn’t find it, the slight possibility that they would find it and it would make a difference would justify the few minutes it will take to create it.  Click here to download a card to carry in your wallet or purse.

Don’t Consider Appreciation or Tax Savings

Don’t Consider Appreciation or Tax Savings 

iStock_000004701496XSmall.jpgAppreciation and tax savings are legitimate contributors to an overall rate of return on rental real estate but what if you didn’t consider them at all.  If you only looked at one or two, very conservative measurements, you might decide to invest especially knowing that there are more benefits that will accrue to your investment.

If we bought a property for cash, collected the rent and paid the expenses, the amount left would be called Net Operating Income.  In the example below, if would generate $7,200 a year which would be a 7.02% cash on cash rate of return which is considerably higher than the current 10 year treasury rate of around 2.3%.

If we place a mortgage on that property, the rate of return actually increases due to leverage.  After the principal and interest are paid, the net operating income obviously decreases but the cash on cash rate of return increases to 9.10% because the borrowed funds means less cash invested.

Another contribution to the investment’s rate of return occurs with the mortgage due to amortization: the principal reduces with each payment made which increase the investor’s equity.  In this example, the equity build-up divided by the initial investment yields a 5.25% rate of return in the first year.

Single family homes for rental purposes offer the investor high loan-to-value mortgages at fixed interest rates for long terms on appreciating assets with tax benefits, reasonable control and an opportunity to earn higher than normal rates of return.  Call if you’d like to talk about what kind of rental opportunities are available.

Equity buildup.png

Breathe Easy – Home AC Maintenance

Breathe Easy 

iStock_000020770516XSmall.jpgThe benefits of regularly changing the heating and air-conditioning filters are obvious to homeowners; the real challenge is creating a system to make sure it gets done. 

A reasonable schedule would be to replace it with a new one-inch pleated filter every 60-90 days. Households with shedding pets should consider replacing them every month. Some people change their filters every month when they pay their electric bills.  A simple system would be to set a recurring appointment on your calendar like Outlook or Google.

Filters trap dust, mold and bacteria which can directly affect the air quality and play havoc with your allergies. When a filter is dirty, it prevents proper airflow and allows dust, dirt and allergens to blow through your home. Changing your filter regularly helps to avoid maintenance, improves equipment life and produces increased energy savings.

When shopping for filters, it’s understandable to look for the best bargain but the cheapest price may not be the best choice. When purchasing, recognize that HEPA-rated and HEPA-type filters are not the same thing. HEPA stands for high-efficiency particulate air. A HEPA filter meets or exceeds standards for efficiency set by the U.S. Department of Energy. Most HVAC contractors recommend HEPA filters.

Some filters need to be changed monthly and other types have manufacturer recommendations of every three months. An alternative to disposable filters are the permanent, washable types. These will cost more initially but because you can clean them and re-use them, eventually, you’ll recapture the cost and realize savings.

Selecting the Right Color for your Home

Selecting the Right Color for your Home 

Have you ever picked a color from the myriad of paint samples available, put it on the wall and decided that it was all wrong? It shouldn’t have to be that difficult but trying to pick the perfect color from those little swatches is just not that easy.

Painters and decorators suggest you buy a small amount of the colors you’re considering. Your paint store should be able to mix them in any brand and any color. Once it’s on the wall, it will be easy to determine if it needs to be lighter or darker or if it’s completely wrong.

Take them home and paint a 2′ x 2′ area on the wall. If you’re concerned about testing the colors on your wall, you can paint some sample boards that can be easily moved around to see how they’ll look with the furniture, floors and other items in the room.

Instead of guessing what it’s going to look like, you’ll actually see how it looks during different times of the day, in natural and artificial light.

While $30 to $40 a gallon for paint may seem like a lot of money, the cost in time and labor to put it on the wall is even more. It’s worth taking the time to test the color on the wall before you buy all the paint needed

Being a Good Neighbor

Being a Good Neighbor

iStock_000041025734Small-250.jpgA good neighbor might be characterized as someone who’ll look after your home when you’re out of town by picking up your mail and watering your plants.  You’d most likely reciprocate for anyone who’d be so generous toward you.

In some cases, you might only be able to name one or two of your neighbors who would step up to that level of service.   Wouldn’t it be nice if more people on your street would be happy to make that offer?

The solution may just start with being a better neighbor first.  The following suggestions go a long way to improving your neighborhood and making new friends at the same time.

  • Meet your neighbors and exchange phone numbers and email addresses.  Agree with each other that you’ll let them know if you see something strange going on at their home. 
  • Slow down when driving through the neighborhood; it will make it safer and everyone will appreciate it. 
  • Control your dog: keep it on a leash; pick up after it; don’t let it bark too much.
  • Don’t park in front of your neighbor’s home.
  • Notify your immediate neighbors when you’re having remodeling done and ask them to let you know if any of the contractors cause damage to their property.
  • Let your neighbors know when you’re having a party and that there will be more cars on the street than usual.
  • Maintain your home and yard so that it adds to the beauty of the neighborhood.
  • Put your garbage out for collection on the correct day and bring the containers back in promptly.

In reality, it is fairly obvious; you just have to think of the things that you’d want from your neighbors.  Be friendly; don’t be noisy; offer a helping hand when available and respect each other’s boundaries.  Having a sense of community and that you all share the neighborhood can be underlying principles that will guide your behavior.

A good neighbor would be aware of suspicious activity and would call their neighbors and the police if warranted.  This might be something you can discuss with your neighbors.  Click here for a template to record your immediate neighbor’s contact information and keep readily available if needed.

Get Your Offer Accepted

Get Your Offer Accepted

As the market shifts from a buyer’s market, it’s good to know how to improve your chances to have the seller accept your offer.

Once you decide on a home, don’t waste time; write an offer and submit it as soon as possible. Competing with another buyer happens more frequently than you’d expect. Multiple offers are a seller’s advantage but here are some tips to level the playing field:

  • Realistic offer – don’t give the impression you’re trying to “steal” the property. Submit comparable sales that justify your offer.
  • Pre-approval letter – this satisfies seller’s biggest concern that an unqualified buyer will unnecessarily take the home off the market and the seller will lose other opportunities.
  • More earnest money – it shows you’re serious and makes the seller feel like the contract will actually close.
  • Minimize contingencies – from a seller’s standpoint, each contingency is one more reason why the sale won’t go through. They feel the home is “off the market” and they’re in limbo.
  • Shorten inspection period – your agent can help you set a reasonable date but let the seller know you’re willing to close prior to that if possible.
  • Write a personal letter to the seller telling them why you want their home – this can be the emotional connection to the seller that makes the difference in you getting the home.
A seller wants to feel confident that the offer they accept will actually close so they can plan for their next move. Following tips like these can definitely affect negotiations and help put together an offer that is more likely to be accepted.

Checklist: Electrical Safety for Home During the Holidays

Electrical appliances provide convenience and enjoyment for the entire family. However, items such as lamps, televisions and electrical outlets can also pose serious injury risks. To reduce the potential for danger, walk through your home and identify all the items that use electricity. After you’ve done that, use the following recommendations as precautions to reduce the risk of shock and burn injuries.

In All Rooms

Lights

YES

NO

N/A

Each light in every room (including lamps and ceiling fixtures) has a bulb with appropriate wattage for the fixture.

 

 

Portable Electric Heating

YES

NO

N/A

Portable electric heater is placed at least 3 feet from combustibles, such as drapes and newspapers.

Portable electric heater is stable and placed where it will not tip over.

Portable electric heater is in good working order (no odd smells, sparks or smoke when operating).

 

Three-prong Adapters

YES

NO

N/A

Properly grounded three-prong adapters are used to attach power cords with three-prong plugs to older two-prong outlets.

 

Electrical Cords and Entertainment Equipment

YES

NO

N/A

Cords are free of frays, cracks or any other damage.

Cords are placed where they will not be stepped on.

Furniture or rugs are not resting on electrical cords.

Cords are not tightly wrapped around any objects.

Cords are not attached to anything (walls, baseboard) with nails or wire staples.

All extension cords are equipped with safety covers on the unused outlets.

None of the extension cords are carrying more than their proper loads according to the electrical rating on the appliances and extension cords.

No extension cords are being used on a permanent basis.

All of the entertainment equipment is placed so that air can freely circulate around it.

All of the entertainment equipment is in a dry location, free of any source of water, including rain, leaks and spills.

 

Electrical Outlets and Switches

YES

NO

N/A

If children are present, all unused outlets have safety covers.

All outlets and switches are working properly.

All outlets and switches are cool to the touch.

All electrical plugs fit snugly into all outlets.

All outlets have faceplates covering all wiring.

 

Ground Fault Circuit Interrupter (GFCI) Protected Outlets

YES

NO

N/A

All GFCI outlets are tested regularly.

GFCI outlets are installed in the kitchen.

GFCI outlets are installed in the unfinished basement.

GFCI outlets are installed in the garage.

GFCI outlets are installed around the laundry/utility tub or wet bar sink.

 

 

In the Kitchen

Countertop and Large Appliances

YES

NO

N/A

All countertop appliances are unplugged when not in use.

All appliance cords are placed so they will not come into contact with a hot surface (such as the oven, range burner or toaster).

All appliances are located away from the sink.

The top of and area above the cooking range is free of combustibles (pot holders, paper, plastic utensils).

 

 

In All Bathrooms

Small Electrical Appliances (hair dryers, curling irons, electric razors)

YES

NO

N/A

All appliances are unplugged when not in use.

All appliances are in good working condition and are working without signs of damaged wiring or parts.

 

 

In All Bedrooms

Electric Blankets

YES

NO

N/A

All electric blankets are in good condition.

The electric blanket is not covered by anything when in use.

The electric blanket is always laid out flat.

If tucked in, the heat producing wires are not bent around the corners.

 

 

In Basement, Garage and Workshops

Fuse Box

YES

NO

N/A

All fuses are the correct size for the circuit.

 

Circuit Breaker Box

YES

NO

N/A

Circuit breakers are periodically turned on and off.

If installed, GFCI breakers are tested periodically.

If installed, arc fault circuit interrupters are tested periodically.

 

Electric Power Tools

YES

NO

N/A

All cord-connected power tools are equipped with 3-prong plugs or marked to indicate they are double insulated.

 

 

Outdoors

Electrical Outlets

YES

NO

N/A

Each outlet has its own waterproof cover.

All outlets are protected by a GFCI.

 

Electric Garden Tools

YES

NO

N/A

All power cords are in good condition (no cracks or exposed wires).

Tools are in good condition and operating properly.

Corded electric power tools are only used in dry areas, not around ponds or other wet or damp areas.

 

Extension Cords Used Outdoors

YES

NO

N/A

All extension cords are marked specifically for outdoor use.

Three-prong extension cords are available and being used with grounded plugs on outdoor products.

 

 

Source: U.S. Consumer Product Safety Commission

Electrical appliances provide convenience and enjoyment for the entire family. However, items such as lamps, televisions and electrical outlets can also pose serious injury risks. To reduce the potential for danger, walk through your home and identify all the items that use electricity. After you’ve done that, use the following recommendations as precautions to reduce the risk of shock and burn injuries.

In All Rooms

Lights

YES

NO

N/A

Each light in every room (including lamps and ceiling fixtures) has a bulb with appropriate wattage for the fixture.

 

 

Portable Electric Heating

YES

NO

N/A

Portable electric heater is placed at least 3 feet from combustibles, such as drapes and newspapers.

Portable electric heater is stable and placed where it will not tip over.

Portable electric heater is in good working order (no odd smells, sparks or smoke when operating).

 

Three-prong Adapters

YES

NO

N/A

Properly grounded three-prong adapters are used to attach power cords with three-prong plugs to older two-prong outlets.

 

Electrical Cords and Entertainment Equipment

YES

NO

N/A

Cords are free of frays, cracks or any other damage.

Cords are placed where they will not be stepped on.

Furniture or rugs are not resting on electrical cords.

Cords are not tightly wrapped around any objects.

Cords are not attached to anything (walls, baseboard) with nails or wire staples.

All extension cords are equipped with safety covers on the unused outlets.

None of the extension cords are carrying more than their proper loads according to the electrical rating on the appliances and extension cords.

No extension cords are being used on a permanent basis.

All of the entertainment equipment is placed so that air can freely circulate around it.

All of the entertainment equipment is in a dry location, free of any source of water, including rain, leaks and spills.

 

Electrical Outlets and Switches

YES

NO

N/A

If children are present, all unused outlets have safety covers.

All outlets and switches are working properly.

All outlets and switches are cool to the touch.

All electrical plugs fit snugly into all outlets.

All outlets have faceplates covering all wiring.

 

Ground Fault Circuit Interrupter (GFCI) Protected Outlets

YES

NO

N/A

All GFCI outlets are tested regularly.

GFCI outlets are installed in the kitchen.

GFCI outlets are installed in the unfinished basement.

GFCI outlets are installed in the garage.

GFCI outlets are installed around the laundry/utility tub or wet bar sink.

 

 

In the Kitchen

Countertop and Large Appliances

YES

NO

N/A

All countertop appliances are unplugged when not in use.

All appliance cords are placed so they will not come into contact with a hot surface (such as the oven, range burner or toaster).

All appliances are located away from the sink.

The top of and area above the cooking range is free of combustibles (pot holders, paper, plastic utensils).

 

 

In All Bathrooms

Small Electrical Appliances (hair dryers, curling irons, electric razors)

YES

NO

N/A

All appliances are unplugged when not in use.

All appliances are in good working condition and are working without signs of damaged wiring or parts.

 

 

In All Bedrooms

Electric Blankets

YES

NO

N/A

All electric blankets are in good condition.

The electric blanket is not covered by anything when in use.

The electric blanket is always laid out flat.

If tucked in, the heat producing wires are not bent around the corners.

 

 

In Basement, Garage and Workshops

Fuse Box

YES

NO

N/A

All fuses are the correct size for the circuit.

 

Circuit Breaker Box

YES

NO

N/A

Circuit breakers are periodically turned on and off.

If installed, GFCI breakers are tested periodically.

If installed, arc fault circuit interrupters are tested periodically.

 

Electric Power Tools

YES

NO

N/A

All cord-connected power tools are equipped with 3-prong plugs or marked to indicate they are double insulated.

 

 

Outdoors

Electrical Outlets

YES

NO

N/A

Each outlet has its own waterproof cover.

All outlets are protected by a GFCI.

 

Electric Garden Tools

YES

NO

N/A

All power cords are in good condition (no cracks or exposed wires).

Tools are in good condition and operating properly.

Corded electric power tools are only used in dry areas, not around ponds or other wet or damp areas.

 

Extension Cords Used Outdoors

YES

NO

N/A

All extension cords are marked specifically for outdoor use.

Three-prong extension cords are available and being used with grounded plugs on outdoor products.

 

 

Source: U.S. Consumer Product Safety Commission

Home Improvements: Enjoy and Profit by Them

Enjoy Your Improvements and Profit by Them 

Capital Improvement Register.pngHomeowners can raise the basis or cost in their home by money spent on capital improvements. The benefit is that it will lower their gain and may save them taxes when they sell their home.

Improvements must add value to your home, prolong its useful life or adapt it to new uses. Repairs are routine in nature to maintain the value and keep the property in an ordinary, operating condition.

Additions of decks, pools, fences and landscaping add value to a home as well as new floor covering, counter-tops and other updates. Replacing a roof, appliances or heating and cooling systems would be considered to extend the useful life of the home. Completing an unfinished basement or converting a garage to living space are common examples of adapting a portion of the home to a new use.

Other items that can raise the basis in your home are special assessments for local improvements like sidewalks or curbs and money spent to restore damage from casualty losses not covered by insurance.

Here’s a simple idea that could save you money years from now.

Every time you spend money on your home other than the house payment and the utilities, put the receipt or canceled check in an envelope labeled “Home Improvements.” Regardless of whether you know if the money would be classified as maintenance or improvements, the receipt or cancelled check goes in the envelope.

Years from now, when you’ve sold your home and you need to report the gain on the property, you or your accountant can go through the envelope and determine which of the expenditures will be adjustments to your basis.

Some people disregard this idea because of the generous exclusion allowed on principal residences. At the unknown point in the future when you sell your home, circumstances may have changed and the proof of these expenditures will be valuable. The tax laws could lower the exclusion amount or eliminate it altogether. Your marital status may change because of death or divorce. The market value of your home may skyrocket.

Since the future is unknown, it is better to keep track of the improvements as they are made and how much is spent on them. Download an Improvement Register and examples or read more in Publication 523 on Increases to Basis.

Holiday Tree Safety

Holiday Tree Safety12/1/2014

iStock_000035874916-175w.jpgFresh holiday trees are beautiful, smell great and really add to the spirit of the season.  Following some proven safety tips might help you avoid a disaster and keep the Grinch away.

  • Select a tree with fresh green needles that don’t fall off when touched or when the trunk is tapped on the ground.
  • When trees are cut too early, they have a greater risk of drying out and can become more dangerous especially with electrical lights.
  • Cut 1” to 2” off the base of the tree before placing it in the stand to facilitate it drawing water to the limbs and quills.
  • Trees require water similar to cut flowers or they’ll dry out. Tree stands should hold at least one gallon of water and it should be checked every day.  A six foot tree could use up to a gallon of water every two days.
  • Position the tree a minimum of three feet or further from heat source like fireplaces, space heaters, heat vents or candles.  Do not allow the tree to block an exit.
  • Lights should be labeled from an independent testing laboratory and intended for indoor use.
  • Follow manufacturer’s recommendations for how many strings of lights can be connected to each other.
  • Turn off all tree lights when you go to bed or leave the home.
  • If the tree becomes dry and begins shedding needles, it can be a fire hazard and should be removed from the home.  Even if the holidays are not over, it is not worth the risk to keep it in your home.
  • After the gifts have been opened, don’t return the paper and boxes under the tree.
  • Remove the tree as soon as possible after the holidays.
  • Trees should never be burned in a fireplace.  The trees will burn very hot and quickly when they are dry and could spread outside of the fireplace which could cause an unfriendly fire.
  • Check to see if there is a recycling program for holiday trees in your community.

The National Fire Protection Association reports that “one of every three home Christmas tree fires are caused by electrical failures and a heat source too close to the tree causes roughly one in every six of the fires.”