Len Penzo dot Com

The offbeat personal finance blog for responsible people.

Are You Smarter Than a 5th Grader? Guess My Rental Car Bill.

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It seems like every time I go to Hawaii, I always learn a valuable financial lesson. I already shared how, during my recent summer vacation there, I was reminded of why folks should always be on their toes when shopping, as illustrated by two sizes of the same detergent being sold at a local supermarket -- and the jaw-dropping price-difference between them. And although you'd think I'd know better, that wasn't the only financial head-scratcher I came across there. After I turned in our rental car I was also reminded why you should never ever take a rental car quote at face value. When I made my rental car reservation I had secured a minivan for the undeniably fantastic price of $282.50 per week, plus $56.50 for each additional day. I know. I couldn't believe it either. Of course, when I was handed the final bill after turning in the car in perfect condition with a full tank of gas, and exactly 8 days and 3 hours of rental time, I was still caught off guard by final bill. Here are a few more pieces of information to consider: I used one of the major rental car companies I was given unlimited mileage for no additional cost I refused all rental car insurance Hawaii sales tax is 4.166% With only that information at your disposal … Are you smarter than a 5th grader? What was my final rental car bill? If you’re up to the challenge, leave your best guess below and I’ll post the answer later this week in the comments section. Don’t be shy; like all of my "5th grader" questions, this is not as easy as it looks. Last month, our defending champion, Deb, showed just how smart my readers really are after nailing the answer to the detergent price question on the button! As always, the lucky guy or gal who comes closest to guessing the actual price will officially be crowned the “Smartest Person in the Room” until the next “5th Grader” post! Good luck! Photo Credit: Jennifer Murawski ...

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Southwest Airlines: Great Prices, but Beware the Bait and Switch

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Before I kick off my little pity party that's doubling today as a do-it-yourself therapy session, let me state for the record that I think Southwest Airlines is still the best-run US domestic airline in the business. Although I have no loyalty to any airline, I love flying Southwest. A big reason is they are generally tough to beat when it comes to low fares, but what really takes Southwest to the next level are their employees -- I think they're the friendliest in the industry, bar none. And I mean all of them; from the pilots, gate agents and stewardesses flight attendants, to the baggage handlers and cleaning crews. Okay, I can't vouch for their mechanics, but I'll bet you dollars to donuts that they're just as happy-go-lucky as the rest of Southwest's employees. Now that I've got that out of the way, it's time to beef. And unless you're the type that's got more money than time I'd advise you to pay close to attention, because what happened to me can easily happen to you too. As many of you know, I'm speaking at next month's Financial Bloggers Conference in Denver. Although I briefly considered trying to save a few bucks by driving from my Southern California home, in the end I decided it made a lot more sense if the Honeybee and I traveled by air. Of course, that required me to purchase a couple of plane tickets. So after a little online research, I found the best deal, by far, was being offered by Southwest Airlines. How good? Well, after entering the pertinent data into their website, Southwest came back with an almost unbelievable deal: two tickets from Southern California to Denver for $104 each, and two tickets for the return leg for $114 apiece. Add it all up and Southwest was offering me two tickets to Denver and back for a grand total of $436! Are you kidding me? I thought I had died and gone to heaven, even though all I really did was stumble upon one of Southwest's web-only "Wanna Get Away" specials. In any case, I was so happy with my good fortune that I did a quick Irish jig (it wasn't much more than 10 seconds) before I hit the "continue" button. Anyway, the next step was to pay, so I dutifully filled out the requisite info and hit the "purchase" button.   And that's when the trouble started, folks. Instead of seeing a confirmation screen on my monitor that verified I had just scored what was probably the best airfare deal west of the Rockies, I got a message in red letters that started with this word: "Oops!" The rest of the message essentially noted that Southwest could not complete my purchase for the return leg of our trip. Fine; I understand websites have occasional hiccups. But after being steered back to the flight selection screen for the second time, Southwest had changed the deal they originally offered. While the cost of the tickets for the outbound flight remained the same, the return leg ticket price had magically increased an additional $199. Each. As a result, the new total fare was $833.20. What the ... ? In the blink of an eye, my airfare just increased $398! I couldn't believe it. This was outrageous! To paraphrase Weekly World News columnist Ed Anger, now I was madder than a flight attendant stewardess with an armful of overflowing barf bags. I felt like I had just taken four $100 bills and tossed them into the whirring jet engine blades of a Boeing 737. On the summary page, Southwest did their best to make me feel better by noting that the higher "Anytime" fare they had just foisted upon me had the advantage of "great flexibility." It didn't work. I didn't want "great flexibility" -- I wanted the "excellent value" they originally offered me with their "Wanna Get Away" fare! As far as I was concerned, Southwest just pulled a classic bait and switch maneuver, and so I called one of their online customer service representatives to voice my displeasure. Jordan, bless her heart, tried her level best to explain how there are only a limited number of those special fares available. She suggested there might have been only one "Wanna Get Away" fare available for the return leg, but since there were two tickets requested, it rejected the original offer. "Then why did Southwest offer me the fare in the first place?" I asked. "I can't answer that, Mr. Penzo." Jordan then tried to make me a happy customer by offering me their "Wanna Get Away" fare on the return leg, but only if I was willing to stay another day in Denver. Unfortunately, that was not a viable option for me. So, after I finished wearing myself out ranting about the terrible financial injustice that had just befallen me, and with the two of us locked in an obvious stalemate, Jordan offered up her condolences. "I'm really sorry we can't help you, Mr. Penzo." Jordan's patience was admirable, and her voice was so, well ... disarmingly pleasant. I swear I could almost see her sympathetic smile on the other side of the line. "I am too, Jordan." We then wished each other well and said goodbye. What a nice young lady! I thought to myself as I hung up the phone. And as I sat there, resigned to my inglorious fate, I suddenly realized that, for some strange reason, I wasn't really mad anymore. Mildly irritated; yes.   But angry? Nah. Photo Credit: Kevin Coles ...

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I Earned HOW Much Last Year? The 6-Figure Mistake on My 1099 Form.

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Now I know how it feels to be paid like my favorite gynecologist, the world famous Dr. Dean, from the Millionaire Nurse Blog.   At least on a weekly basis. The reason I say that is because a couple days ago, after a long hard day at the office, I was immediately greeted by the Honeybee as I opened the door. And I instantly knew something was amiss because, usually, the only one to greet me -- or even acknowledge my presence -- when I come home from work is my dog, Major. That is, unless I'm bringing home dinner. Then the whole family suddenly gets sentimental -- at least until they pull the bags out of my hands. But I digress. Anyway, this time the Honeybee was waving in her hand a 1099-MISC from my employer that reported some bonus income they paid me last year for a patent I was recently awarded. "Have you been holding out on me, Len?" she asked, although I still had absolutely no idea what she was talking about. "What are you talking about, Honeybee?" "Take a look at this!" And with that, she handed me the 1099-MISC form. Here's what I saw: Yep; that's $200,000 in the "other income" box. Naturally, the Honeybee wanted answers and she wanted them fast. And to tell you the truth, so did I. Of course, she wanted to know when my employer was going to pay us the other $198,000 that the 1099 form said I was entitled to. As for me, I just wanted to know how I was going to explain to the IRS that this was all one big mistake. Luckily, the fine print on 1099-MISC form explained what to do in case of an error. "If this form is incorrect or has been issued in error, contact the payer. If you cannot get this form corrected, attach an explanation to your tax return and report your income correctly." That's it. Simple! So I contacted my employer; it turns out the company was already aware of the error and a new 1099-MISC is now in the mail. By the way, in case you're wondering, the procedure is slightly different for an incorrect Form 1099-R. According to the IRS, in that case you should still try and contact your employer and have them correct it. However, if you fail to receive the corrected form by February 14th, you should call the IRS at 800-829-1040. For more info, click here. See; sometimes the IRS can be reasonable. Well, at least they can if you're not the one who made the mistake. Photo Credit: H. Michael Karshis ...

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The End of the World & Other Magic 8-Ball Predictions for 2012

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Happy new year, readers! Like last year, I'm kicking off the start of 2012 with more fearless predictions from my old friend, the Magic 8-Ball. In case you missed it, the Magic 8-Ball ended 2010 with an astounding 70 percent success rate, and I'm happy to say the predictions for 2011 were almost as good, as the 8-ball was accurate 66 percent of the time. Of course, this year the 8-ball was pelted with questions from readers and fellow bloggers looking to get a leg up regarding what's in store for 2012. (I know. I can't believe it either.) Anyway, let's get right to them. Tradition dictates that the Financial Samurai always gets to ask the first question, and here it is: Q: Will real estate continue to rebound in major cities such as San Francisco and New York? A: Ask again later. I'm asking you now. A: Outlook not so good. I have to agree with you on this one, 8-Ball. The market is clearly being artificially propped up by government subsidized mortgages, ridiculously low interest rates and banks that are still withholding large backlogs of foreclosed properties from entering the market. On a related note, I see Jennifer from Little House in the Valley has a follow-up question: Q: Will the housing market continue its spiraling descent in 2012? A: Outlook good. Okay, but obviously "good" is a poor choice of words. The next set of questions come from Maggie at Square Pennies: Q: Will Ron Paul win the presidency? A: Better not tell you now. Okay. Thankfully, Maggie also asked the question from a different angle. Let's see if that will get you to open up. Q: Will Newt Gingrich win the Republican nomination? A: Cannot predict now. Well, this is embarrassing. I guess even my 8-ball can suffer from a little performance anxiety every now and then. I'll take some pressure off by getting a bit less specific: Q: Will a Republican be elected president in 2012? A: Cannot predict now. Oh, really? Get this: I suggest you try again, 8-Ball, or I'll outsource the rest of these predictions to a tarot card reader while you find yourself sitting on a flimsy card table at our next garage sale. So let's try it again: Q: Will a Republican be elected president in 2012? A: It is certain. Thank you. Meanwhile, Nelson from Financial Uproar wants to know: Q: Will the European Union break up? A: You may rely on it. Agreed. I suspect the EU will stay together in some form, although it will probably be sans many entitlement-heavy nations. On a related note comes this question from Average Joe: Q: Will Italy and Greece finally default on their debt? A: Very doubtful. Time will tell. I believe a default by Greece is inevitable -- the only question is when. My bet is that Greece defaults in 2012 and that will then precipitate a partial breakup of the EU. Let's lighten things up a bit. My friend Paula from Afford Anything asks: Q: Will Prince William and Kate Middleton announce a pregnancy? A: Without a doubt. I just hope the pregnancy they'll be announcing is their own. Switching to the world of sports, Erin is dying to know: Q: Will the Green Bay Packers win the Super Bowl in 2012? A: My reply is no. I'm with you, 8-Ball. Although I'm no football expert, I suspect the Pack won't even make it to the big game this year. Jacob has another sports-related question, but this one is on golf: Q: Will Tiger Woods win a major in 2012? A: Most likely. I think the 8-ball is wrong here. Tiger's fortunes have sunk so low that, even TMZ found it newsworthy when he finally broke a two-year victory drought in December 2011. Next up are two questions from folks concerned about Apple stock. First up is Bill, who wants to know: Q: Will Apple’s stock price end 2012 higher than its closing price on the day Steve Jobs died? A: You may rely on it. We'll see. The day Job's death was announced, Apple's closing share price was $377.37; it's starting 2012 at $405. Meanwhile, Hank from Money Q&A wonders: Q: Will Apple finally begin issuing a dividend in 2012? A: Outlook good. The 8-Ball's response confirms rampant rumors that Apple, which is currently sitting on billions of dollars in cash, will indeed reward stockholders by reintroducing stock dividends this year, after originally dropping them during leaner times in 1995. Becky asks: Q: Will savings account interest rates rise in 2012? A: My sources say no. That isn't good news for senior citizens and others who are living on fixed incomes -- especially, if inflation continues to be worse than the government keeps telling us. My good friend, Dr. Dean from the Millionaire Nurse Blog was kind enough to play straight-man today by offering this follow-up: Q: Will inflation hit 4 percent in 2012? A: Very doubtful. If we're going to use the official government statistics -- and we are -- I think the 8-ball is correct. The next two questions take us back to the stock market. First up is my friend, Crystal from Budgeting in the Fun Stuff: Q: Will the Dow break 13,500? A: My reply is no. I think the 8-ball is right on this one. In fact, I suspect the Dow will finish 2012 in the red, although it will experience a sharp rebound in the latter half of the fourth quarter. And it looks like Dr. Dean is hoping the 8-ball will be kind enough to give him a hot tip for the new year: Q: Will Microsoft hit 30 bucks in 2012? A: As I see it, yes. With this stock starting the new year at $25.96, that would represent a hefty return for 2012. I think the 8-ball is all wet. Switching to the unemployment picture, Kay Lynn from Bucksome Boomer asks: Q: Will the unemployment rate fall to 7 percent? A: Yes. I think the only way this is going to happen, 8-Ball, is if the number of people actively looking for work continues dropping, since the government doesn't count them as unemployed. But we'll see. I see Jacob is back and this time he has precious metals on his mind: Q: Will gold top $2000? A: Signs point to yes. That's good news for the gold bugs. If you ask me, though, I think silver will be the biggest mover of the two in 2012. Geoff, better known as the Car Negotiation Coach, had an interesting query: Q: Will online poker become legalized in the U.S. in 2012 (and make the government billions in taxes)? A: It is certain. Somehow, I doubt that. For the second year in a row, Pamela wants some insight into Jennifer Aniston's love life: Q: Will Jennifer Aniston get engaged in 2012? A: Outlook good. Fascinating. Who needs People when we've got the Magic 8-Ball? Meanwhile, my friend Greg from Control Your Cash wants to know: Q: Will the components of the Dow stay unchanged in 2012? (Bank of America is in, while Google and Apple are on the outside?) A: Outlook not so good. I should note that, last year, Greg correctly predicted here that student loans would be the focus of a government bail out in 2011. It'll be interesting to see if he's similarly prescient in 2012 with respect to the Dow. Finally, Chris wraps up our annual prediction party with a question that is, for many people, perhaps the biggest concern of the new year: Q: Will the world end in 2012? A: Don't count on it. Uh huh. I don't believe in all that hokey Mayan prophecy either, 8-Ball. Hopefully your comforting prediction will be good enough to finally put such an absurdly unfounded fear to rest for good. Oops. I guess I spoke too soon. Jennifer from Little House is back and she still wants to know: Q: When the world finally does end, will zombies make a comeback? A: Reply hazy, try again. Heh. I don't think so. Photo Credit: Andrew Malone ...

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