Sorry I haven’t written lately. I’ve been dreaming about what to do with my stimulus check. I just received my letter from the IRS on Monday saying that the check should be in my mailbox by this Saturday. How time flies.

I’ve been thinking about what we should do with that $1,800 for months now and still haven’t made a decision. In fact, we have the rare occurrence of having an additional $10,000 burning a hole in my checking account from a finished a freelance gig.
And since the crystal ball is cloudy, keeping it liquid but away from evil Splurge’s reach (isn’t that a great name for some monster villain?) is my priority. ESPECIALLY after watching my parents’ flat screen TV for the first time yesterday. Golly is that nicer than my buzzing relic from the late-90s.

So I started to hunt for CD rates, beginning with bankrate.com. I picked a nine-month duration, just in case I owe Uncle Sam more than I expect.

Surprise! You are still not rewarded for locking your money away any more than you are for depositing it in a high-yield savings account earning around 3 percent online.

To be honest, I’m bored with high-yield savings accounts, though. I know that safe savings isn’t supposed to be exciting. But curious to see what other relatively risk-free options are out there, I hit the web.

I’ve mentioned Everbank’s world currency CDs before. And while I have enough money to invest in certain flavors, I could lose principal if the price of the currency I’m invested in takes a dive.

I could help finance someone’s business in a third-world country through Microplace, but nine-month terms yield less than 2 percent. Feeling good might be worth the 1 percent I give up, but if I needed the cash, I’d be out of luck.

So readers, the sum sits in my ING account, twiddling its thumbs at 3 percent. Any other ideas?

I diligently check the monthly Personal Income and Outlays report put out by the Bureau of Economic Analysis. It’s a poor measurement of true savings because it’s simply a snapshot at the end of the month of how much money you have lying around, but I look at it nonetheless because it’s the number people point to when they chide Americans for having a negative savings rate.

Well, ha!

Today, I saw an eye-rubbing, is-this-a-typo savings shift. Personal savings as a percentage of disposable income was 0.4 percent in April. In May it was a whopping 5.0 percent!

See for yourself.

Maybe it was that the economic stimulus checks or the tax rebates came in and Americans didn’t have time to spend them before the month was up. Maybe all the bad news has caused us to hunker down. Perhaps we’re beginning to realize that going to the mall every Saturday is not exactly living the good life.

Whatever the reason, I have to say it was a pleasant surprise, although surely we can save more. And I think accurate* reports of our negative savings rate are history.

* I’m sure misinformed people will still say we don’t save for months, if not years to come. Publicly challenge those people for me, would you? Especially financial planners doing seminars trying to convince you to give them your money by scaring the crap out of you.

I found a savings account that earns 3.90 percent APY. And the icon’s even better than ING’s orange orb.

It’s called SmartyPig. And besides having a slightly higher interest rate, the site helps you save for a specific goal and use peer pressure to stay on target. (more…)

I’ve become accustomed to flying a couple of times per year (at least) to visit family or go on vacation.

This year, we flew to LA for a wedding and Mexico on vacation, both for well under $500 per person. And I remember after college grabbing tickets to San Francisco for $150 round trip. For Labor Day 2006 our family of four flew to Chicago for about $300 (the little guy didn’t pay for a seat, though).

But I worry that cross-country leisure travel for people with average-sized pocketbooks could be a thing of the past.

My price threshold for buying a domestic plane ticket is set at a somewhat random $350 per seat. That means no trip to see my cousin get married outside Harrisburg, PA (seats are around $470) or to see a family friend marry in Connecticut (seats were a whopping $509 to fly into Hartford). At those prices– and with airlines charging for bags, food, you name it– we’ll be grounded for some time.

Auto travel is no better with gas prices approaching $4.00. The AAA predicts that the number of Americans driving more than 50 miles away from home over the long weekend will decline by about 1 percent, a small number, but a big sign because it rarely declines.

We’re a contributor to that decline. We were planning to go to Kansas City to see a two-day kids music festival where They Might Be Giants and Justin Roberts are playing– two bands my kids as well as my husband and I really enjoy. There’s an elephant at their zoo too. But we decided loading up the car would be tiring and expensive. We’ll be digging up tree roots in our yard instead.

Day-to-day,I am driving shorter distances when I can. I haven’t set foot in my beloved Costco for months now because driving from St. Paul to St. Louis Park for cheap milk just doesn’t feel like a bargain (although I’ve yet to run the numbers). I’m also trying to bike to work more.

How about you? Have you made any changes– big or small– to cope with higher fuel prices? Skipped trips? Traded in the SUV for a Hybrid?

Hello. I’m back from sunny California, the land of heavenly weather, wonderful scenery, heavy traffic, $3.93 gas and $5.99 almonds (they were only $3.99 back home on the tundra).

Apologies to those of you whose comments were stuck in moderation all weekend. And stuck in the rain/snow.

Many thanks to brilliant budget bride Aimee for holding down the fort.

I didn’t pay much attention to the money news when down in the valley. It was a vacation, after all. But I did notice a few stories about retailers offering deals to shoppers who use their stimulus checks to stimulate their earnings– and the economy.

As my colleague Jackie Crosby reported today, Lands’ End, Kmart, Sears, Roundy’s (Rainbow), and Cub are offering discounts to those of us who spend our rebate with them.

What if your rebate will be directly deposited into your bank account? Cub spokeswoman Haley Meyer said that Cub “will work with shoppers” who “show us proof” that the rebate was deposited. The proof needed is a copy of your bank statement or print-out of your online bank account. My guess is other retailers will also accommodate e-deposited funds.

I don’t know about you, but I’m planning to milk the “spend $300, we’ll give you $30 deal” that Cub announced and Rainbow matched.

Here’s my reasoning: I spend about $100 in groceries each week. Yes, that’s a lot of money tied up in grocery gift cards if I throw in the entire $1,800 my family expects. Yes, it will take me almost five months to use up those gift cards, but that’s a free $180–almost two weeks of groceries.

Tell me this: Where else can you get a risk free rate of return of 10 percent on your money in five months? Certainly not in an online savings account with the Fed expected to lower rates once again. Not in a CD. Not under my mattress. Not in short-term bonds. This is about the best short-term investment around. And if they’ll let me use my credit card that earns me 6 percent back on groceries to buy the gift cards, I’ll earn another $108.

Milk it? You bet.