Improving Gas Mileage - Installment 2

In a deperate attempt to keep up some momentum here, I am posting

Improvement #2 – Check Your Tire Pressure

Potential savings: $10 – 78 (0.4 – 3% improvement)

Cost: $0 – 75 and time to check and fill up tires

Cost of my recommendation:
$75 one time for a compressor (if you don’t have one)

Tire air pressure has a significant impact on gas mileage. Tire pressure decreases as a small amount of air leaks out over time or as temperature drops through the year. According to the US Department of Energy and the EPA, gas mileage decreases by about 0.4% for each 1 psi drop in tire pressure.

So if your tires are 10 psi low, your gas mileage will decrease by 4%. If you are getting 25 miles per gallon (mpg), that 4% translates into a 1 mpg loss. Low pressure will also lead to increased tire wear - you will have to pay to replace your tires sooner.

At the same time, overinflating tires can be a safety issue. An overinflated tire has less contact with the road and can be more unstable in braking or turns.

You can usually find your recommended tire pressure inside one of the two front doors, the glove compartment door, or the owner's manual (NOT on the tire itself, as I used to think).

These are recommended pressures when the tire is cold, so always check your tire pressure before you drive anywhere.

The cheapest way to check your tire pressure is to carry a tire pressure gauge in your car and check the pressure in the tires once every week or few weeks.

There are a couple of good products out there that make it easier to monitor your tire pressure:

A) Tire pressure stem caps - Tire pressure stem caps screw on to your valve stems (you know - those little things you use to check tire pressure) and turn yellow or red when your pressure gets low. These are also great to keep an eye on the pressure in your spare tire.

B) Automatic tire pressure monitors - These systems add sensors inside each tire and display the pressure of each tire on your dash. A number of new cars now come with this option. They are more expensive to buy and install but much more convenient!

Because most places seem to charge for air now, I have my own air compressor to air up our tires. If you don't have an air compressor, you may want to invest the $30 or so in an air tank.

You can fill this up at your local gas station and keep it in your garage to air up your tires if you need to. You could also invest the $75 or so for small air compressor to take out the middle man.

Having an air compressor is my personal recommendation to make it easy to air up your tires. And let's face it, the reason most of us (well, at least me) don't do this as often as we should is that it is too much hassle (and most gas stations charge for air now).

There are also small air compressors that can run off your car battery - they take a long time but are great in a pinch.

My recommendation:

For the convenience (and increasing the chances that you will check your tire pressure more often), get a small air compressor for your garage. Don’t carry it around with you in your car, though (see Improvement #6).

This improvement was pretty straightforward, but there will be a lot of new information (for most people) in #3 - Use Synthetic Oils. That should be up tomorrow!

Improving Gas Mileage - Installment 1 of 6 (or so)

With gas now at nearly $4 per gallon, I just couldn’t stand it anymore. I finally had to write down the things that I know can help you improve your gas mileage.

Gas prices have certainly been in the news alot lately, and though (like many of my subjects as of late) it is not directly related to passive income, I feel it is something that a lot of people are interested in, so i am going to share my knowledge (limited as that may be :) ).

Some of these you will know, maybe some you won’t, and maybe this will help give you a reason to do some of those things you know you should!

In this day of ever-increasing gas prices, there are lots of gimmicks out there that promise to increase gas mileage. The purpose of these tips is to cut through the fluff to show you the things you can do that are PROVEN to improve gas mileage. I’m an engineer by training, and I don’t like to present facts without seeing that they are backed up with some sort of proof.

Also know that I have chosen improvements that are easy to implement, produce quick results, and are safe. There are a number of other improvements that did not make the list because they do not meet one or more of the above criteria (for example: over-inflating tires and drafting both improve fuel economy if done right, but are safety hazards).

The improvements are ordered from easiest and highest impact to more difficult to implement or lower impact.

So without further ado, here they are:

1) Maintain Your Fuel System (today's installment!)
2) Check Your Tire Pressure
3) Use Synthetic Oils (engine, transmission, and differential)
4) Drive more “Efficiently”
5) Breathe Easier – Change Your Air Filter
6) Lighten Your Load

You’ve probably heard most (if not all) of these before, but I want to put some real numbers to each of these improvements for you so that you can make a very informed decision about how to implement these ideas.

Each of these six posts will give you the details on one of these subjects – approximate costs, potential savings, and the reasons behind the savings.

I have based the savings and cost analysis on a typical year (except where noted) for the “average driver”, driving 15,000 miles per year, getting 20 mpg, and paying $3.50 per gallon (I still can’t believe that) for gas.

My Recommendations

At the end of most sections, I include my recommendations for the best bang for your buck on each improvement (where applicable). These are the same recommendations I would make to friends and family and if anything don’t go as far as I personally would.

These recommendations are based on what? My experience. That’s all I can talk about. They may not be right for you, which is why I try to provide some discussion on each topic so that you can make an informed decision for yourself. Fair enough? Great!

Onto the “nitty gritty”…

Improvement #1 – Maintain Your Fuel System

Potential savings: $39 – 184 (1.5 – 7% improvement)

Cost: $10-115 and a little time

Cost of my recommendation: $20
- $20 for AMSOIL additives
- Nothing for TOP TIER fuel (in most places)

This really falls into two parts – a) trying to restore your fuel system to its new and clean condition, and b) maintaining that cleanliness.

Not only can this significantly improve gas mileage (average of 2.3% in testing – I have gotten confirmed reports of up to 8.8%), but it can improve the responsiveness and drivability of the car – in other words, help it drive “like new” again.

A) Clean your fuel system periodically

Most gasoline sold today contains only the minimum amount of detergent additives – you know, the things that keep your fuel system clean – that are required by law. This is not enough, as many automobile manufacturers have discovered (see the second part of Improvement #1, below).

Unfortunately, over time, deposits build up in your fuel system causing inefficiencies in your engine. Not only that, the deposits tend to build up differently in different cylinders, so one cylinder might be getting too much gas and another not enough while your car thinks everything is working normally.

This usually increases pollutants considerably as well. Why? Today’s engines are actually very finely tuned to emit very few pollutants IF THEY ARE RUNNING RIGHT. Once the deposits build up and the fuel mix varies between cylinders, pollutants can increase significantly.

So what do you do?

Use a fuel additive to clean out the system periodically. I have seen testing showing 15% reduction in fuel flow in an injector in only 3,000 miles.

The problem isn’t necessarily the decrease in fuel flow (though it’s not good) – the real problem is when one cylinder is getting 85% flow and another is getting 95%. Your car assumes they are all getting the same when, in fact, one may be getting way to much and one may be getting way too little, which causes each to operate VERY inefficiently, lowering your mileage

Unless you have a brand-new car, your fuel system is not perfectly clean. Try an additive to restore power. I recommend AMSOIL based upon the extensive third-party testing that has been done. (I do sell AMSOIL products, but I only do so because I have determined them to be the best products out there based upon independent tests.) There may be other good ones out there, but I have not seen anything comparable.

AMSOIL recommends adding fuel additive every 4,000 miles to keep the fuel system clean. Depending on what kind of gas you are using and how much you care about your car, you can always either wait until you notice a drop in performance (I don’t recommend this – it is tough to notice because it happens so slowly) or try it again after 6 months or a year and see if you notice an improvement.

My recommendation:
Use AMSOIL or another very high-quality fuel additive at least every 6 months.

(For more information on the AMSOIL additive, click here or feel free to contact me directly.)


B) Use TOP TIER gasoline

OK, this doesn’t actually improve gas mileage but it theoretically helps maintain it. A group of automakers (BMW, GM, Honda, and Toyota) jointly developed these standards because they determined that the federally-mandated levels of additives were not enough. The TOP TIER designation was created to help keep the fuel system properly clean.

As of January 2008, this was the list of TOP TIER retailers in the US and Canada. All grades of their gasoline must meet the TOP TIER standards to make this list:

QuikTripChevronConocoPhillips76ShellEntec StationsMFA Oil CompanyKwik Trip/Kwik StarThe Somerset RefineryChevron-CanadaAloha PetroleumTri-Par Oil CompanyShell CanadaTexacoPetro-CanadaSunoco-Canada

As my friend Kevin Burns summarized: “Use red gas stations or Shell.” I’m not sure that works in all parts of the country, but where I am it works pretty well. Thanks, Kevin!

I try and use gas from this list whenever I can, even if it costs a couple of cents a gallon extra, but usually it doesn’t (but not if it costs 10 or 20 cents extra – then my frugality kicks in!).

Even if there is no hard data behind it, the automakers would not go through all of this trouble unless they saw significant benefit to the end user in it, so sign me up – I am sold on TOP TIER gasoline.

(Unfortunately, a similar standard for diesel fuel does not exist to my knowledge.)

Do I need to do both of these?

Yes – at least initially you need to use a fuel additive to get the fuel system clean. Then if you ALWAYS use TOP TIER gas, that should be enough.

Again, you could always check after 6 months or a year by adding more fuel additive. If you notice an improvement, then you probably ought to use the fuel additive on a regular basis. If you don’t notice an improvement, then TOP TIER gas is probably enough (at least until you notice a drop in performance down the road).

Here is what I recommend:
ALWAYS use TOP TIER gasoline unless it is much more expensive in your area or just not available.

Whew! Well, that's it for today's installment. Most of the rest will be shorter (but no less informative, I am sure!). I will plan on putting those up over the next few days so check back often!

Without health, your passive income won't mean much...

Not directly related to passive income, but an important topic for happiness in life is HEALTH.

Rebecca and I just got back from a 4-day Peak Potentials (T. Harv Eker's company) training called Extreme Health. Although there were some speakers that I would categorize as "fruity", there weren't as many as I expected.

SIDEBAR
Let me clarify that by "fruity" I don't just mean non-Western medicine, I mean the people that want you to go inside your mind to heal yourself or manipulate you to allow your soul to "breathe again". They might work; I am simply very skeptical about these types of healing.

My wife is an MD specializing in Emergency Medicine, and even she really enjoyed the conference.

In terms of specific strategies for improving your health, we looked for several things from the speakers: 1) How healthy did they look overall?, 2) How did they look for their age?, and 3) Was it a program that Harv himself used?

There were four things we bought while there:

1) Raw food - David Wolfe presented on this subject, and his passion and vibrancy really came through. We especially liked his philosophy of just adding some raw foods to your current diet.

2) Mercury test kits - An MD presented on the multitude of ways mercury can affect the body - mainly neurological, but also general fatigue and other very serious diseases. Amalgam fillings is the most common cause. More info at http://www.mercout.com/; check out the video on mercury and live nerves. We highly recommend at least getting tested for this.

3) Gene SNP - They test for 36 common mutations in DNA that can cause susceptibility to certain diseases if you don't get the right nutrients. In other words, it is a test that allows you to know what levels of nutrients are critical for you to get in order to help avoid diseases you are prone to. based upon genetics as well as your diet and lifestyle (from a questionnaire).

Rebecca majored in genetics in undergrad, so we had to get this done. The test is much cheaper than from other places - I suspect because they also provide optional supplements that are tailored to your results. I don't really plan on using their supplements, but I certainly want to know my susceptibilites and that I am getting enough nutrients. More info at http://www.genesnphealth.com/. If you have trouble getting info, you might also contact Suzanne Stradley at 503-661-5050 or suzannestradley@comcast.net.

4) The "Cellercizer" - named not because you have to exercise in the cellar (or will quickly put this there) but because it exercises all of the cells of your body. Rebecca and I were most excited about this one (and are eagerly awaiting its arrival!), so I will give a little more detail:

I first recommend you go to the website and check out the information because I am not going to be able to convey the benefits as well as the guy who developed it.

Click here for more info

It looks like a trampoline but has some important design features that I (as a former engineer) appreciate. He also had a number of testimonials that say his presentation and went out and bought something cheaper before not being able to do some of the exercises (or even hurting themselves when something broke) and ultimately bought a "Cellercizer".

The balance benefits are amazing - he did a great demonstration of this by forcing people (even a yoga instructor) to lose their balance, then not being able to after just 30-60 seconds of bouncing.

Not to mention the strength and flexibility that he can demostrate superior to yoga teachers, and the "Cellercizer" is his only exercise.

He also is incredbly strong (and ripped), but not a big as a bodybuilder by any stretch. he builds all of his muscle just on the "Cellercizer" - no weights at all.

The muscle he has built is also very "soft" - let me try to explain: When building muscle, we typically rip muscle fibers and rebuild them larger, creating a little scar tissue (which is relatively hard) in the process. "Cellercizing" works the body without ripping the muscle fibers, building muscle without the scar tissue.

Again, you can't compete as a bodybuilder just doing this, but I think most people (guys at least) would love to be as muscular as he was.

You can do cardiovascular work very quickly: 2-10 minutes of intense exercise is more effective at fat-burning than a 45-60 minute workout in most cases. (This was mentioned by several of the presenters over the 4 days).

Finally, pretty much anybody can use it. Even people in wheelchairs or walkers can start to use it and often regain mobility by rebuilding muscle, improving circulation, etc.

Moral of the story: If you want to be more fit, this is a great tool to try out - less time, more fun, and better results! (30-day money back guarantee of course)

More Cellercizer info here

Book Review: Be Principled and Grow Rich

Wow - a new post is WAY overdue! I just read a short book with some great information, so this is the perfect opportunity for a new post. And since stock investing can generate passive income if done right, the post is even on-subject.

Be Principled and Grow Rich by Kirk W. Tofte with Samuel Case

This book was a very quick read, which is perfect for me since I have a relatively short attention span (like start making a sandwich, get distracted by something - anything, really - then find the partially made sandwich an hour or more later - that kind of short).

Not knowing really what to expect, I was somewhat surprised to find that it was a study on improving stock performance using a really simple tool - what the authors call Principled Asset Rotation (PAR). You may have heard about it, but I hadn't, so it was completely new to me.

To boil it down to the bare takeaways:

1) Figure out if the S&P 500 or Russell 2000 performed better last year.
2) If the S&P 500 performed better, invest in large-company growth stocks (ticker symbol IVW if you are into ETFs) the following year.
3) If the Russell 2000 performed better, invest in small-company value stocks (ticker symbol IWN if you are into ETFs) the following year.

If you are interested in the principles behind it (like I am - I can take very few things at face value without understanding the underlying principles), definitely read the book. My brief explanation is thus:

The economy moves in cycles. The stock market is a forward indicator of the economy. Therfore, performance of stocks in certain sectors of the economy in one year predict where we will be in the economic cycle and therefore which stocks will do well.



There were a couple of things I found odd about the book:

1) The authors did not mention exchange-traded funds (ETFs) for using this investment strategy. I think they would be a perfect tool because they nearly perfectly mimick the indices the authors mention (less about a 0.2% expense ratio).

2) They propose several other strategies with historically worse returns (presumably because they get farther away from the underlying principles) because the transaction fees might be "too high" for some investors with small caps. With ETFs (or even the mutual funds they mention), this should not be an issue at all.

These things don't detract from the book, I just thought it interesting...

All of the data in the book ended in 2001. As a former engineer, I couldn't help but run the data from 2002 to 2007. The book's method outperformed the S&P 500 and Russell 2000 over that total time period (like 55% vs. 23% vs. 48%), but didn't do well at all in 2007 (based upon the 2006 indicator).

I suppose when you arbitrarily pick a calendar year, that is bound to happen, but I am certainly impressed with the overall results. (I will also mention that 2002 to 2007 was a little weird as the small-cap value was the choice every year over that timeframe.)

I plan to play with this using a small portion of my portfolio this year, then maybe move a larger portion (up to 25%) into this strategy.

If you have read the book or implemented the strategy, I (and other readers) would love to hear your feedback.

Good luck!