$19 per month unlimited* calls, texts, data (Republic Wireless)

If you know someone who needs to have a cell phone, needs to save money, has WiFi (Wi-Fi) at home, and is willing to endure some hiccups while the company matures, then Republic Wireless is offering cell phone service with unlimited calls, texts, and data (apps and web browsing) for $19 per month. There is a one-time upfront cost of $199 for an Android smartphone, but there's no contract.

I heard about Republic Wireless from Clark Howard (Clark Howard has the BEST personal finance radio show / podcast. Aside from General Conference, he's pretty much the only thing that I listen to on my iPhone. I even use an app that allows me to use podcasts for my alarm). He's currently using the Republic Wireless phone. He has noted that call quality was initially noticeably bad, but that now people can't tell. He loves Republic Wireless, and avidly recommends it.

There are some catches right now:

1. The beta is currently full. They aren't accepting any users right now, but likely will each month and will notify you via email.
   
2. You MUST have access to WiFi at home (and at work, if possible).
3. The service is still working on "handing off" calls from WiFi to cell network, and vice versa. However, T-Mobile has "Wi-Fi Calling" (UMA) which provides great (although perhaps not perfect) transitions between calls, so everyone's expecting Republic Wireless to get that ironed out soon. This means that right now if you start a call at home on WiFi, then you can't just walk out to your car and continue the call. The call will drop as you leave your WiFi and you'll have to call them back on the cell network. Similarly, if you initiate a call from your car on the cell network, then when you get home the call doesn't switch to your WiFi (which means that it's being counted against your "usage" — more on that below).
4. The service is a community that offers "membership", but withdraws membership if you overuse the cell network (instead of using WiFi). The community's monthly fair usage threshold is to talk "550 minutes, send 150 texts, and download 300 megabytes of data" over the cell network. So, it's only truly unlimited over WiFi. They send you a warning the first time with suggestions on how to avoid hitting the caps. If they do have to revoke your membership, then they help you transition back to a regular provider. As long as you connect to Wi-Fi as much as possible wherever you are, then it's unlikely that you'll run up against this limit.
   
5. They only offer the service for a single phone (a low-end Android smartphone). So, no iPhones, and no cutting-edge Android phones (yet, they're expecting to gradually increase their selection).
   
6. There's an upfront cost of $199 to purchase the phone (but no contract).
   
7. You can't port your current phone number to Republic Wireless. They're working on this, though. In the meantime, you can port your number to Google Voice, and then pass calls and texts on to your Republic Wireless phone to achieve essentially the same thing. (Or, you could port to an intermediary if your network doesn't port directly to Google Voice.) Plus, if you use Google Voice, then you have access to voicemail transcriptions, texting from any computer, and a single number to ring all your phones, among other features. Yes, I love my Google Voice.
   
8. If multiple people are sharing a family plan since additional lines can be pretty cheap, then the cost savings may not justify the additional hassle while Republic Wireless is maturing their service. And, if only some of you switch to Republic Wireless, then those left behind may not be able to talk to you for free (since most in-network calls are free).
   

However, the advantages of Republic Wireless are pretty substantial:

1. Service is just $19 per month (max).
   
2. You get unlimited calls, texts, and data as long as most of it is over WiFi.
3. No contract.
4. It's a really inexpensive way for someone to switch to having a smartphone if they want to be able to use apps, and browse the web, and access email from their phone.
5. If there's somewhere where you have poor cellphone reception, but have access to wireless, then you may have better call quality over WiFi than over the cell network.
   

If you're accustomed to paying $80 a month ($960 a year), then paying $19 a month saves $61 a month ($732 a year). That's a hefty chunk of change, and likely worth the hassle if you're trying to make ends meet, just want to save all that money, or don't have a smartphone but would like to have one.

Vehicle make reliability

Adapted from an email follow-up to a conversation:

The most widely referenced report on car reliability is produced by Consumer Reports. Consumer Reports provides the most comprehensive, well-respected car reliability survey. They explain their method as follows: "Our data are based on an annual survey of subscribers to Consumer Reports and ConsumerReports.org and are not derived from road tests. A model needs at least 100 responses per model year for us to score it. From the survey, we create a reliability history for each model over the course of 10 years, 2001 to 2010. We use the data, in part, to forecast how well the 2011 models will hold up. We might predict reliability for a newly redesigned model, but only if previous versions had outstanding reliability."

Unfortunately, you have to subscribe in order to see the entire report. However, they do provide a summary of highlights for the 2011 findings. The fifth bullet point states "While European reliability had been improving, momentum seems to have stalled. All Porsche and Volvo models are rated average or better. But Audi, BMW, and Mercedes-Benz are among the worst automakers overall." Yep. So, basically, you have to get extremely lucky to get a reliable BMW.

Also, someone was kind enough to scan the ranking of manufacturers. BMW ranks 23 out of 27, just above Dodge and Chrysler, which basically means that they're in the pit of despair.

Unfortunately, it looks like Consumer Reports didn't include Land Rover in last year's survey. Perhaps they didn't get back 100 responses per model. Land Rover was purchased by Tata Motors (along with Jaguar), so the transition period may account for the low numbers of available surveys. However, I was able to find Land Rover in the second figure of this 2009 survey blog entry. It ranks last with Chrysler. Again, the pit of despair. Maybe it's good that Land Rover didn't even make the report this year. They'd probably be in either last or second to last. That blog entry also shows the average Volkswagen as having three times as many problems as the average Toyota.

JD Power and Associates does provide a car dependability survey, but they only look at a three year span. And, honestly, I don't know what to think of their report. It ranks Honda and BMW both at a three out of five, but Lincoln at five stars. That seems incredibly dubious. Land Rover scores two out of five. In their press release figure (after the text) Land Rover is third from the bottom.

And, here are some random car buying links:

An article from SmartMoney on "How to buy a car online for less".

An article on the nice surprises from Hyundai's new cars. There's still room for improvement, but they're outstanding value for your money.

The case for used cars

The car that I just purchased is a used 2010 Hyundai Sonata, but the Kelly Blue Book was $16,701 and I got it for $11,950 ($13,590.35 after taxes and fees). So, I saved almost $5,000 off blue book value; and around $8,000 off a new 2012 Hyundai Sonata (starts at $19,695, the GLS automatic starts at $21,470)!

The car has 25,486 miles on it, but seems almost new. A used Hyundai and Kia comes with the remainder of the 5 year / 60,000 mile bumper-to-bumper warranty. Almost all other used cars (Toyota, Honda, Ford, etc.) come with the remainder of a 3 year / 36,000 mile warranty. On new cars, you would get those respective bumper-to-bumper warranties, plus a powertrain warranty (10 yrs / 100k miles for Hyundai & Kia, 5 yrs / 60k miles for almost all others) that doesn't transfer to subsequent owners. The powertrain warranty only covers if something goes wrong with the engine, driveshafts, etc..

If you're willing to, I highly recommend considering used cars. Cars depreciate very quickly. As soon as you've driven a new car off the lot, you've lost thousands of dollars in value. In the first year, new cars lose about 20% of their value. So you could save 20% just by buying a year-old car! After two years the average depreciation is about a THIRD of the original price of the car. I saved close to 40% by buying a used Sonata vs a new Sonata. In addition, taxes, registration, and insurance is more expensive for a new car versus a used car. Most financial planners will recommend that you buy a car that's 2-3 years old. At first I was looking for a car 3-5 years old, but I realized that I wanted to have some time left on the manufacturer's warranty, just in case. Going out to 5 years narrows your selection to Certified Pre-Owned vehicles, which is okay although you do incur a premium.

If you'd rather stick with new cars, then I totally understand, especially for girls. No one wants the hassle of his / her car breaking down, but it's much less likely that a car breaking down will leave a guy in an unsafe situation than it will for a girl, so a used car is generally less of a big deal for guys. I'm hoping that I've hedged my bets and that my car will both be significant savings and little to no hassle. We'll see! *Knock on wood!*

If you are willing to look at used cars, I highly recommend Wholesale Direct Auto Sales. They're a low volume, low cost dealer that works part-time out of an industrial lot southeast of the airport. It's by appointment only if you'd like to look at one of their cars. They will also go to the lot if you'd like to send a mechanic to check over one of their cars.

Vince Oddo
Wholesale Direct Auto Sales
4340 E Superior Ave
Phoenix, AZ 85040
480-229-9615
azauto@yahoo.com
http://heat21.com/

It's much easier to look at their cars on cars.com since you can filter for what you want:

    http://www.cars.com/for-sale/searchresults.action?stkTyp=U&dlId=3505475

In particular, the burgundy 2011 Kia Forte EX with 19,382 miles seems to be a killer deal. It's a great looking car with a very cool interior. The Kelly Blue Book value for the car is $16,628, but it's selling for $12,500. You'd get the remainder of the 5 yr / 60k mile manufacturer bumper-to-bumper warranty. This is the other car that I was seriously considering.

If you're willing to look for a used car, then I highly recommend cars.com (my favorite because you can limit your search to a much broader set of permutations of brands, sources, price ranges, age, etc.) and autotrader.com (filters only allow searching for three makes at a time, but more private sellers list on AutoTrader). Use Kelly Blue Book (kbb.com), edmunds.com, or nadaguides.com to see how much a car is worth. For the iPhone, the NADA app seems to be the quickest / easiest for pricing a used car.

Some other things that you'll want to keep in mind:

There's no sales tax on private sale (so from a regular person rather than a dealer), which can save you easily $1,000. I would only do this with cars with a good amount of warranty left, though.

I was shocked when Wholesale Direct Auto Sales charged me a $199 documentation / processing fee. He assured me that most dealers run $400-600. I've called five dealers (used and new), and they ran $390-500. I'm sure the $600 dealerships are luxury places like BMW or Lexus. I didn't bother calling them.

Figure in tax (9.3% in Phoenix, so $1,111.35 on my car), and registration (almost $300 in my case, but much higher on new cars — I shared a Google spreadsheet with you so you could calculate it for your own car). All in this added $1,640.35 to the $11,950 that I was expecting to pay for the car. The $13,950.35 number caused a great deal of sticker shock.

If you're going to get financing, then it's generally cheapest to get pre-approved somewhere, rather than using the dealer's car loans. You can check rates and find lenders at bankrate.com . As with any loan, the interest incurred means that you'll be paying more than you would have if you had paid in full up-front. Limit yourself to the shortest, smallest loan possible, with a maximum term of three years (otherwise, you're definitely buying more car than you can afford). You're going into debt for a depreciating asset, which only makes sense because it allows you to get to work.

As you consider brand, absolutely check to see where they rank on Consumer Reports reliability ratings. I'll send you another email about that.

Based on reliability and very subjective personal preference, this is the order that I used when looking at car brands:

1. Honda (king of reliability — excluding luxury brands — ever since Toyota slid)
2. (Toyota: used only; my parents have had so many bad experiences with getting their Toyotas serviced that if I were going to buy a new car, I wouldn't get a Toyota)
3. Hyundai (best value & warranty: 5yr / 60k miles; 10yr / 100k mile powertrain)
4. Kia (tied best value & warranty)
5. Mazda
6. (Scion: used only; Toyota's flashier brand)
7. Ford (the only American manufacturer with high reliability ratings, and also the only American manufacturer who didn't need a bailout this recession; dropped this past year in reliability ratings due to the use of Microsoft's mySync software, not due to any mechanical issues)

If you read the reviews for a lot of the Hyundais and Kias (for example on KBB.com), then you'll notice that the reviewers rave about how many more features you get while still paying less than what you would for the competing Honda, Toyota, or Ford. In the past you've lost a little of that value more quickly because of steeper depreciation rates for Hyundais and Kias, but the resale values for Hyundai and Kia have improved significantly in the last couple of years — in part because they've finally realized that looks do matter, but most likely because they've been relentlessly improving value.

I ended up getting a Hyundai because of how significant the savings were for this particular car : ).