Mindy: Welcome to the BiggerPockets Money Podcast where we interview Larry and Hope from Under the Median and talk about saving money on your utility bills. Hello, hello, hello. My name is Mindy Jensen and joining me today is my kind of bad at retirement co-host, Kyle Mast.
Guest: What does that mean? What does kind of bad at retirement mean?
Mindy: Aren’t you retired, Kyle? And yet here you are working. The internet retirement police are coming for you.
Guest: Are this work? I don’t know. Uh, I, I can’t sit around on a couch. No, I I keep plenty busy, but yes, yeah. Airbnb is not quite as retirement focused as people might think. So I’m I’ve been busy lately with we had a big party in one of our houses that, uh, has been become an issue. So it’s sucked a bit of my time and pulled me out of retirement temporarily.
Mindy: Did you host the party or did somebody else host the party without your permission?
Guest: Oh my goodness. I did not host the party. I am not a party. I go to bed at 8 o’clock. Um, no, someone lied to us on the booking and said it was something else and had a a big smash and there was vomit and other things walked through a large house. So we have had to, yeah, it’s been, you know, one once in a while you have a real bad one and that’s just kind of part of the business. So that’s been my pull out of retirement thing lately.
Mindy: Oh, well, yuck. That’s I was just teasing you about this, but that’s actually really gross.
Mindy: I’m sorry, and I hope it gets cleaned up quickly and they never come back. Uh, all right, so Kyle and I are here to make financial independence less scary, less just for somebody else. And, you know what, this is this is something that you can do in your financial independence journey is have an Airbnb and not worry that it’s going to ruin you because you’ve gotten money out of the way, right, Kyle? So now when you have a really, really awful thing, it doesn’t devastate your financials. Number one rule in investing in real estate, if you don’t have reserves, don’t invest in real estate. Uh, that’s Mindy’s number one rule.
Mindy: All right. So Kyle and I are here to introduce you to every money story because we truly believe financial freedom is attainable for everyone, no matter when or where you’re starting.
Guest: Whether you want to retire early, travel the world, go on to make big time investments in assets like real estate or start your own business, we will help you reach your financial goals and get money out of the way so you can launch yourself towards your dreams.
Mindy: Kyle, we have a new segment on the show called The Money Moment, where we share a money hack, tip or trick to help you on your financial journey. Today’s money moment is actually really surprising to me. There’s no age requirement for an AARP membership. Members between the ages of 18 and 50 can reap all the benefits of a membership except those that are age restricted by law or contract, like age-restricted insurance products. I did not know that before. I really thought it was only for, uh, older citizens. So that is actually really cool. Um, do you have a money tip for us? Email moneymoment@biggerpockets.com.
Mindy: All right. Today we are speaking with Larry and Hope from Under the Median, and they are absolutely delightful. I totally enjoyed talking to them and hearing their tips for reducing your utility bills. Kyle, what’d you think of the show?
Guest: Oh, I think it’s great. I this is I dig this kind of stuff where you get a little hack here and there to be able to add to your your tool belt, your tool for your tool belt of saving money and things that uh, you can do once and kind of be done with, you know, the the set it and forget it type strategies and they really focused in on the utilities thing here and it it’s really cool. These are things that can save a lot, especially this last year or so with the increase uh in inflation and especially utility prices. Every kilowatt hour that you save is a big deal these days. So, yeah, this is a great episode.
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Mindy: Larry and Hope have a growing YouTube channel with 160,000 subscribers called Under the Median. They teach families practical frugality skills so they can pay off their debt and live a life they love while keeping their spending under control. Hope and Larry, welcome to the Bigger Pockets Money Podcast. I’m so excited to talk to you guys today.
Guest 1: Thanks so much for inviting us. We’re excited to be here.
Guest 2: Yeah, thanks for thanks for having us.
Mindy: Let’s start off with a little bit about your background. Can you tell us a little bit about how you became the world-famous YouTubers that you are today?
Guest 1: Well, we started off getting married 35 years ago, and two months after we got married, I opened the statement from the bank and realized that we were flat broke. And I he got home from work and I said, um, I think we have a problem. We have some work to do. We have to figure out this money thing. We had dated for five and a half years before we got married.
Guest 1: And not once had we ever had a conversation about money. I mean, go figure. We thought that that old adage of we’ll just live on love. We thought it was true. No, not true. We had to figure this thing out. And so that’s when we started researching, all right, how do you budget? How do you figure out where your money’s going, where it’s coming in, where it’s going out? And we literally like, I raided the library shelf on personal finance and I read and I researched and we figured this thing out. But yeah, we started off with nothing.
Guest 1: And in debt and both making $5 an hour.
Guest: So when did you guys start, uh, decide to start the YouTube channel? What what got that going?
Guest 2: Well, Hope and I kind of wanted to share some of the things that we had learned over the years. We thought maybe we had some things that other people would be very helpful for them to know. So, actually it was Hope’s idea and the first show, she was going to do it as a solo and she said, how would you like to be on the first show with me? And I said, okay. And then she asked the audience if they wanted me on with her and they said, yes. So I’ve been with her almost every single show since.
Guest 1: So for context, some of the things that we really wanted to share with people, after we got our finances under control and we had four boys along the way, we raised the kids debt-free on an income, which averaged at that time around $40,000 a year, and we paid cash for everything, including cash for the house that we live in right now. And so we had learned a great deal about not just frugality, but figuring out how to spend money on the things that are super important to you and saving money on all the rest of the stuff so that you had money for the stuff that was important.
Guest 2: And we really took this in steps. It it started with the big announcement from Hope that we were going to pay cash for our next car, which I thought was impossible. I I told her she was insane, actually, in in love, of course. But uh, I said, if you can do it, I’ll get on board with you. And we didn’t do it the very next car, but the one after that, we’ve paid cash for the cars ever since. And that was in the mid 90s.
Guest 1: So it’s a good thing because I was the visionary. I didn’t really have a plan, but I had like the vision. And he is the concrete sequential, show me step by step by step how we’re going to get from point A to point Z where where it is that we want to be. So that’s sort of forced us, we learned to work together as a team really well because we relied on each other’s strengths in this whole area.
Guest 2: Yeah.
Mindy: I love that. I have long said, spend on what’s important, save on things that don’t matter. How do you determine what falls into which category? Do you have any advice for somebody who is saying, oh, I I hear what you’re saying, but I don’t know how to do that.
Guest 2: Hope is all about setting priorities. In fact, that’s a theme you’ll hear often on the channel. Hope, how do you go about setting those priorities?
Guest 1: Well, the first thing we tell people is you have to figure out what your BBB is, your bare bones budget. So you have to have a roof over your head, food in your stomach, transportation to get from point A to point B. And you need to make sure that all of your basic bills are covered. That’s your bare bones budget. That has to be your top priority. because here’s what happens. If you wind up over spending on the things that are way or should be way down the list, then you wind up thinking, oh my goodness, I have this bill do, I have the mortgage payment, I have the car payment, I have these other things and I’m having trouble figuring out how to pay them. You got to pay those things first and then prioritize everything else from most important to least important. Once you put it in the right order, then it becomes really clear not only where you’re spending your money, but where you’re over spending your money.
Guest 2: And just to take a step backward from that, the very first thing you have to do is know where your money is going. So the first step that we took toward budgeting was tracking every dime we spent. For the first month, we just wrote everything down into a notebook. And that way we knew where our money was going and how much of it was going where.
Guest: So, let me dig into that real quick. This that BBB that you said, that’s really awesome. The barebones budget. Um, so, I can see people, a couple sitting down at the table and saying, okay, we need to figure out what our barebones budget is. How do how do we decide what that actually is? Like, do you have any like mental games that you can play or like, because I’m thinking, okay, the barebones budget is, you know, I’ve got to eat out like twice a week every month, you know, that that’s bare bones, you know, but really no like or is it better, you know, maybe you think about something like, if I lost my job tomorrow, how long could we live on the necessities and what are those necessities, you know, like what how do you, how would you coach someone to actually get to what that true BBB is?
Guest 1: Well, that’s part of where our barebones budget came from was Larry came home from work and said, oh, by the way, I got laid off today. And I was like, oh, okay. And that was I think the first time that we put together our barebones budget because that budget was, he not if he loses his job, he had lost his job. What do we need to pay the basic bills every single month? That literally became our barebones budget. But some of what we encourage people to do is think about this whole category of what constitutes your barebones budget and what doesn’t, like this whole idea of eating out. All right. So, before you spend money on something, you have to determine, do I need this? Do I need this now? And how will this purchase impact my other goals? Because we can talk all day long about how to practice frugality and how to live on less, and those are all wonderful things. But unless you’ve figured it out what you’re going to do with all this money you’re saving and what your goals are, then it’s not that it’s pointless, it’s just that you wind up with what we like to call the big green pile of cash because we did it.
Guest 1: We started saving money and all of a sudden we had this big, it’s like, whoo, let’s go on a trip. Let’s because your savings account all of a sudden looks like this spendable money. And after a couple of times of digging into that green big green pile of cash, we went, wait a minute, maybe this money should be set aside for something else. And that’s when we figured out, gosh, we need some goals.
Guest 2: Well, at that time we bought, I think it was a $13,000 van, which doesn’t sound very expensive by today’s money, but that was from that big green pile of cash Hope was talking about. Well, we really hadn’t budgeted out our items specific enough to know what we could afford in a vehicle, and we really couldn’t afford a $13,000 vehicle. Our our limits now are right around the $10,000 range for a vehicle based on all the rest of the budget and our additional goals that we have tacked onto it. So it takes a little bit of time and effort to work down and narrow down exactly what your priorities are in terms of how much money you need to budget.
Guest 1: Yeah. So your definition of what you can spend on something, be that major or minor, should not be how much money is in my savings account. That should not dictate it. Your goals dictate where your cash goes.
Guest 2: Mm-hmm.
Mindy: That’s a really great point. I like that so much because I think a lot of people who are new to this, new to wanting to get their finances in order, new to figuring out their money may not realize that.
Guest 2: Yeah, Hope and I worked on this budget scheme over a period of many, many years. So it developed over time. We’ve been married for 35 years and we’re still refining the process. So this isn’t something that we just did in two weeks.
Guest 1: Well, one of the big mistakes that people make is they start this whole idea of budgeting, and they give it a couple of months. Well, you know, life happens.
Guest 1: Uh, something unex unexpected happens and you wind up needing to spend money on it, and people get discouraged and they think, well, this whole budgeting thing doesn’t work. It does work, but you have to give it. We tell people six months. You start budgeting, you give it a good six months, and then you’ve got some granular data that you can look at to determine what your spending patterns are looking like over time, and then you can make a lot of, uh, minute changes to the budget that will make it perfectly work for you.
Guest 2: For me, this meant peace of mind. I could rest knowing, we know where our money is going, we know how much of it should go where. I could sleep at night instead of guessing with our money what we were doing. Now we had a very specific plan implemented in and in place that we could go by. So, it’s it’s like having a map. You wouldn’t want to go on a vacation without a map or without a navigation system in your car. Can you imagine just going and not knowing where you’re headed? That’s what it’s like without a budget. But with that in place and all those specific items and categories, you’ve got a clear map to follow.
Guest: That’s awesome. I mean, this is something that is, uh, you know, I’m a CFP, so I’ve worked with clients of different sizes on on things like this and in detail and not in detail. And for me personally, my wife, we were just talking yesterday, um, the budget process, you can’t give up on it. It keeps going, it keeps evolving, and you have to over time, you get better at it, and then there are periods of time where you get worse at it, and you have to come back to the drawing board and redo it again. Um, but let’s keep, let’s keep moving on here because I there’s something, there’s a reason we, one of the reasons we brought you guys on here is you have this awesome video on YouTube and I was just telling you before we got on, um, and you just did it on utility costs. And we’re going to we’re going to jump into that because I was literally writing things down that I’m going going to check with my utility company and some of the things that I do. We we kind of had some commonality here between some solar, um, electricity stuff between Mindy and you guys and me and some of these energy issues. Um, but you had some awesome tips in here. So, um, can you give us just a little bit of, uh, you know, why you think this it’s important for people to look at their utility costs to begin with?
Guest 1: Something that happens with utility costs and we’ve seen this time and time again is people say, I can’t do anything about it. They’re going to charge me what they’re going to charge me. I’m stuck. I I I can’t choose a different utility company. They are what they are and it is what it is. And the truth is, yeah, they’re going to charge you what they’re going to charge you, but you are not stuck paying whatever. You can actually make some really simple steps that are going to lower your utility cost and lower how much energy you are using.
Guest 2: And the first step is just like with the budget, you have to track where your power is going. You have to know what is using power in your house and how much is it costing you each month.
Guest: That’s awesome. And we’ll link to this video in in the show notes for this. So what are the big hit items that you can do first to take care of the biggest chunk of your utility costs and then kind of whittle it down from there?
Guest 1: So when we talk about saving on utilities, there are so many different things you can do, but really focusing on maybe the top five things that you can do at one time and then tracking how that is helping you to save on your energy costs. Just focus on a few things at once because people get because we we have so many we’ve researched this for years, uh, because we wanted to figure out how to pay less than we were paying for utility costs. And there are a lot of things you can do, but there are some things that will have a bigger impact than others. One of those is literally knowing how you are spending your energy. What where is it going? What is it in your house that is sucking that energy and causing you to pay higher bills? Now you mentioned and it’s really important, a lot of people don’t realize utility companies, a lot of them, not all of them, give you a lot of granular data that you can look at and determine specifically like what time of the day that you are expending more energy in your home. Our utility company’s website does this. We just sign up for an online account. We can get behind the scenes of our personal usage down to 15-minute increments on any given day of the week. And we can see where those spikes are and say, all right, what were we doing?
Guest 1: What what activity? Oh, look, we were using the toaster oven. Well, the toaster oven will pull about a thousand watts while you’re using the toaster oven. And when we saw that, we you can see the spikes on our actual chart. You can see those spikes and we’re like, wait a minute, what uses less energy? Well, we actually tested it. We did a video where we tested four common kitchen appliances. We roasted squash with all four of them. And the instant pot, hands down winner. That baby sipped energy compared to any other method that we tested of cooking those squash. And so then I was like, wait a minute, it’s like making these minute adjustments. Once again, we’re like, all right, we use the toaster oven, can we cook a little more using the instant pot? That’s going to lower that energy bill and that energy usage just a little bit. But let me really quickly, I know Larry’s got something to add, but um, let me quickly say that if your utility company doesn’t give you this information, you’re like, nope, blank slate, blank wall, they’re not telling me anything. You can actually create your own chart to follow your own energy patterns. All you need are four columns. You need to know when you get the bill, don’t write down the date that the bill came. What goes in that date column are the dates for which you were charged for that energy. So it should say somewhere on your bill, here’s the date the bill is sent out, here’s the date it’s due, here are the days of the month that you are being charged for. That’s the date that you want in that first column. Those are the dates that you’re following for that energy usage. The second one is going to be the kilowatt hours that you used. That should also be on your bill. The third thing is how much they are charging you per kilowatt hour.
Guest 1: Now, that changes throughout the year. Some people don’t realize that there are summer rates and winter rates. So don’t assume that it’s going to be the same thing. Some utility companies and these are some of the questions you need to ask your company, are there days or times of the day in which you are physically charged less per kilowatt hour than other times of the day. That’s also very common. Utilities aren’t standardized across the United States. Every single state has a different amount that it’s charges for electricity.
Guest 1: So for instance, if you are in California, you’re you’re probably paying about 32 cents per kilowatt hour. Here in the Midwest, we’re we’re charged quite a bit less. Across the United States, is about 24 cents per kilowatt hour. And 24 months ago that was about 12 or 13 cents per kilowatt hour. So the rates for electricity have actually doubled in the past 24 months. So it’s not your imagination. They really are charging you more, but you have to know what they are charging you. So the fourth column that you’re going to have on that handy dandy chart that you’re creating as you go along is how much your bill was. Now, you track that over a period of time and even without the energy company giving you all the data that my energy company does, you can chart whether you are physically using less kilowatt hours or more each month.
Guest 2: If I can jump in, another thing you can do if you don’t have really good internet access with your energy company is get a little device called a kilowatt meter. It sells for about $20 on Amazon. It simply plugs into the wall and then you plug your appliance directly into that. It it will show you, for first it will show you the voltage on your line, then it will tell you the watt power consumption that that item is using that’s plugged into it. So that’ll tell you right off the bat, how much is this using? Like our microwave oven uses about 1700 watts. It’s a big one while it’s on. It also uses 1.2 watts when it’s off. That’s just the clock that’s running it. We went around the house with the kilowatt meter and we checked all kinds of different items that we had and we found out what of the major problem that we had that we weren’t addressing was Phantom power. Now you can call it Phantom power, vampire power, anything with a scary first part of it. That’s that’s drawing power that’s really you’re just throwing money away. And what the typical usage of an item with that’s drawing Phantom power is typically using about 70 to a well about 7 to 10 watts. So that is quite a bit. That’s about the same amount as an LED light bulb. And if you take that over time, if you multiply that through a 10-year period of having just what say 10 items in your house plugged in that are Phantom power, that can be running $2,010 over a 10-year period. And that’s figure at a rate of 23 cents a kilowatt hour. For us, that would be a nice little vacation. Imagine being able to recapture that amount of money by not leaving items plugged in.
Guest 1: People sort of discount this this whole idea of the importance of remembering to turn lights off when you’re leaving a room or this whole idea of unplugging things when you’re not using them because people don’t realize that anything that has an LED uh light or so, it’s standby power. The clock on it, anything with a clock or remote, instant on, instant off.
Guest 1: It it’s going to be pulling power even when it is off. And so statistically and I’ve done a lot of research on it, it’s somewhere between 10% of your entire utility bill each month, um, or your entire electric bill, I should say each month. and some experts even say up to 20%, but it really depends on how many of these items you have plugged in and um and how much each of these items is drawing. but a little bit over a long period of time, Larry just did the math. Doing the math is so important.
Guest 1: People are like, well, it’s just a dollar a month. I’m not I’m not gonna I’m not gonna unplug that item. It’s a dollar a month. It’s worth it to me. But if you have 10 of those items and you leave them plugged in, that’s $10 a month. $10 a month is $120 a year, which over 10 years is 1,000 bucks. Once you extrapolate that math, it does add up.
Guest 1: So that’s all a part of knowing how you are using energy in your home that kilowatt meter, game changer for us, guys, best $20 or less investment you’ll ever make is knowing how much energy each of the items you’re using is is actually consuming.
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Mindy: So, Larry just said 2,000 over the course of 10 years, yeah, and quick math has that coming in around $16 a month. So I can hear somebody saying, oh, that’s no big deal. But let’s look at how much you saved when you started paying attention to your energy bill. You went from using a 1,227 watts down to 942 watts, down to 375 watts over six weeks and that translates from 324 down to $213 down to $111. That’s real money and that’s by making small changes, little changes, tiny changes that are not necessarily going to affect your life considerably, but these are things that you’re doing consciously and now you’re saving $113 on a on a utility bill. That’s a huge amount and that’s just one thing that you’re saving money on. I bet you could take this, especially if you are just new to this whole, I want to get my finances in order. You start questioning all of your bills and start tweaking little things. It’s these little, and I mean $113 is not a little amount. If anybody thinks that’s a little amount, write me a check for $113. Do it frequently. I’ll take that anytime you want to send, you know, if that’s nothing, send it to me. But, you know, these little things add up over time to very real big dollar amounts. In your video, you noted that your electric company offered an hourly plan, but that someone else’s supplier may have a different way to bill. What’s the best way to go about figuring out your options with your supplier?
Guest 1: One of the things that we tell people is, first of all, don’t be afraid to ask questions. So, these people are there to serve you. That’s their job. And they’re not going to be offended. They may be surprised. A lot of consumers don’t actually call the utility company and say, can you tell me uh how much you’re charging me per kilowatt hour for my electricity. Can you tell me if there are off-peak hours that I can be using this electricity? Can you tell me if they’re days of the week? Some utility companies have days of the week where they deliberately the whole 24 hours of that day, they’re going to charge you less per kilowatt hour. That’s information that not only do you as a consumer need, it’s information that you as a consumer deserve to know. And one of the things that you’ll discover when you start researching utility, uh, rates is that it’s hard in some ways to get information that is concrete and information that is fairly based because once you start researching it, you’re going to come across, you know, HVAC companies that put new equipment in for you or you’re going to come across, uh, solar power companies who want to put a solar array on your roof. And so those and it’s not that the information they’re providing is bad or inaccurate, it’s just that they have invested interest in selling you those things. One of the things that we have that you can look for in your state, in the state of Illinois, we have something called CUB, Citizens Utility Board. It is a not-for-profit organization that their sole goal is to save money on utilities for the people who live in the state of Illinois. And they have a great service. You can send them a copy of your utility bill and they will have one of their experts for free go through your bill and give you a list of ways that you could be saving more money on your utility bill. And interestingly, because I’ve been doing clearly, paying attention to our utility cost for a number of years and I told Larry, I said, I’m just going to send it in for fun, just to see if their expert can pinpoint any areas that we’re actually maybe wasting some energy and wasting some money and they surprised me because they came back with five different specific suggestions for us on ways that we could lower that utility bill. And I was like, kudos to you. didn’t cost me a penny. Whenever you are seeking information, try to find information from sources which are not biased. This utility board has been an incredibly helpful resource for us because they provide information from the standpoint of the consumer and helping them to spend less.
Guest: That’s awesome. I I think finding an organization like that is incredible. And I I think like what you have and we’re going with two samples here. We have Illinois where you guys are from. Um, I checked on my utility, uh Portland General Electric in my area in Oregon, um, and they have a lot of good information too. and I’ll just to give the listeners an example of what you might run into. So they have a peak time option where if you reduce your, if you sign up for this program and you reduce your usage from 5:00 p.m. to 9:00 p.m., um they charge you more for that time, but then you have a much lower rate for the other times of the day. And that’s something that definitely me personally, I can do. We have some, we have some solar, we have some batteries that we can, uh, heavily depend on during that time for sure, um, and and not use anything else. So that would be for me, that’s check the box there, do that. there’s a time of day, um, uh, thing that they offer with mine. there’s an EV charging and a panel upgrade thing that I saw that you can actually get these massive rebates to have an installed EV charger and a $5,000 upgrade if it it causes you to upgrade the panel to your house. So these are things that are like, there’s money sitting out there that it’s part of your local utility program that these guys are are putting out there to increase the long-term sustainability of your grid. And it’s your civic duty in my opinion to take advantage of those as much as you can. Um, I also from your YouTube video, there’s a couple things that um, I really would like to focus on here for this last little part. Um, there’s there’s a few things in the house. You you mentioned like turning lights on and off. Um, LED bulbs, you know, maybe we can touch on that just just briefly. and also, uh, talk a little bit about air conditioning. And this is something, uh, that people might push back on, but I have some comments here too, but I’d love to hear what you guys here about, or or have to say about this. And there was something else in your video too, talk about the dehumidifier a little bit and what that’s a surprise that you had there. Um, so yeah, just maybe these are some things that I was surprised by. So kind of share a little bit about them.
Guest 2: Well, we’re getting down toward the end of June and we have not yet turned on our air conditioning. Uh, we’re having an unusually pretty cool late spring. So we’re we’re doing quite well. One of the things that we recommend to use along with air conditioning are fans. That doesn’t that can mean a whole house fan, that can mean ceiling fans or just table model fans. Fans use very little power. We just got a really nice old 1920s style fan. It uses on low power, on the first setting, 18 watts. So it’s very power efficient to use fans which use the uh the simple form of cooling your skin by evaporation.
Guest 1: Yeah, one of the things that people don’t realize, for instance, if you will use fans in the room in which you are sitting, statistically, you can raise your AC by up to four degrees with no loss in comfort.
Guest: Sorry, I sorry to interrupt you on there. I want people to hear that and this is, this is kind of a an incredible thing that if you have maybe a ceiling fan, um, that these are, that’s not fans take in a comparison of power usage, so significantly less than something like an air conditioning unit. Um, there’s no comparison really. Um and that’s it before air conditioning units, evaporative coolers were what was used a lot of times and it’s the same principle um of the fan blowing on your skin. But this is, this is a really interesting thing. And the other thing that, you know, I maybe jump in here too is that uh, well when I was younger, we have a Christmas tree farm that I grew up on and my family would sell Christmas trees on retail lots in Phoenix, Arizona, and we would go down there in late August, September to get things set up. And I’m from Oregon and I just about died the first time I went down there, but our bodies are amazing that if over time you can slowly acclimate yourself to a different temperature because I’m hearing my wife right now saying, I’m not putting fans everywhere. I’m not turning it up four degrees. I don’t want to be sweating. It it’ll be me that’s sweating, not my wife probably. But, I mean, that’s that’s what I’m hearing, but it’s our bodies are really amazing and they will acclimate over time. You don’t have to keep it at 69 all summer long. your body can can adjust. you don’t have to keep it in a movie theater during that entire time. Um, but yeah, so the the air conditioning unit and then, yeah, the the fans, um, what else?
Guest 1: Well, so one of the things people don’t realize too is that for every degree that you raise that central air, statistically, you’ll save between 1 and 3% for every degree that you raise or lower it on your final bill. Now, for us, we have discovered about a 2% savings for every degree that we raise that AC in the summertime. That 2% per degree will show up on our final bill that we have saved that much money. So there is savings inherently in that, but here’s the other thing people want. Right. So, central air is for one thing, it’s to lower the relative humidity of your house, all right? So it makes you feel cooler.
Guest 1: Fans are all about evaporation. It doesn’t actually cool the air in the room. It makes you feel cooler because all of the natural, uh, wetness on your skin is evaporating and you feel like you are cooler, which is the whole goal of using anything. But the that fan is going to cost you about 1 cent per hour to use. That air conditioning, depending on whether you’re using a little window unit or using a um a whole house, um AC system, central air, is going to cost between 14 and 28 cents per hour to run. So it is a significant savings to be able to use fans in Lo of uh central air. But we are a huge fan of using them in conjunction with one another because for us that kind of strikes that right balance.
Guest 2: But you need to so in the Midwest, like humidity is huge. Well, we’re we’re humid here and in the south, if you live in the south part of the United States, southeast or south central, you’ve got major humidity issues that you have to deal with or you’re going to have mold in your house. And the key to keeping mold build up is to have your humidity in your home 60% or less. That will hold back the mold. So, if you get, what do you call it? A hygrometer.
Guest 2: Yeah. And so if you get if you get one of those, it will tell you the relative humidity. We have one in our basement, so we monitor that and that keeps us from using our dehumidifier, which actually pulls close to 600 watts when that compressor is engaged. And we found out that that little unit was pulling an awful lot of power. So, what we found from some suggestions actually from some other people is that you can put your dehumidifier on a timer and have it run two hours and have it run and then shut off two hours or half an hour on, half an hour off. you don’t have to run it all the time. And then you can set that so that it’s maybe running at 50% humidity or 58%. If you run that at full, you might bring your internal humidity down to say 48% or 40%, but you don’t need it to be that low just to prevent mold. You’re kind of wasting energy if you’re running a dehumidifier that much.
Guest 1: And I will say that like the whole reason we even produced that video was because we got the highest utility bill we have ever received in our entire life last July. And I was like, what in the world. And so that set off alarm bells in my head and I said, we’re doing something. And this is where it pays to know your cycle of energy usage. and we knew that was not right for us. We’re like, something is going on that is massively using energy in our home. What is it? And we became like energy detectives, trying to figure out what it was, and it came down to that silly dehumidifier. And I was like, holy cow, look at how much this is drawing and we’re basically using it 24/7 because we’re like, well, 60% relative humidity, less must be better. No, all we were doing was wasting energy trying to get our house way below 60% when 60% is that sweet spot where you need it to be so that mold doesn’t grow in your house. Any humidity 70% or above for a period of time will allow mold to grow. 60% is where we need it and we went, well, that’s what we but it’s it’s all in, it’s all in being willing to dig and find information and find out the facts that you need to know.
Guest 2: So, basically, you’re in a lot more control over your utility bill, especially your electric bill than you think that you are.
Guest: I’m learning a lot right now and it’s kind of, uh, enlightening because we have a short-term rental property that has a dehumidifier in it. It has an indoor hot tub in a room that I put a dehumidifier in there to keep the room, uh, dryer. Uh, and I have the setting quite low. I’m not going to say how low it is, uh, but that’s going to be adjusted the next time that I go to the property. Um, and I’m sure that will have an effect on the I mean it’s a big house, so there’s other utility expenses too, but that that will definitely, uh, have an effect there. Uh, but yeah, this is this is super, you know, even things like thinking about a window air conditioning unit to cool your bedroom down at night instead of running your whole house HVAC system. Um if you really need it cool to sleep at night. That’s something that we did personally and it took me like several years to figure that out and there’s just this stigma in my mind with like this ugly little window unit sticking out the window of of the house, but I don’t care anymore, you know, it makes such a big difference to be able to not have to cool the whole place down.
Mindy: You do have control over your uh utility bills, but only if you do the research, only if you start looking into what’s there. And that’s one thing that I loved so much about this video, uh Larry and Hope, is that you brought this to my attention and to hundreds of thousands of people’s attention is that you do have power over your utility usage. It isn’t just, well, that’s what it is and that’s all I’m going to be able to to do is just pay it and that’s I’m stuck. uh, you’re not and you can look into ways to reduce your energy cost. I didn’t know a kilometer thing existed. I didn’t know about the dehumidifier. I do live in Colorado where we don’t have any humidity at all. so uh I don’t need one of those. but there are definitely other um energy sucks in my house that I know of right now that I am going to go uh talk to my children about. and you know, I can hear people listening to the video, watching the video saying, I’m not going to be able to turn up my AC to 79. Oh my goodness, that’s too hot. But so maybe you don’t turn it up to 79. Maybe you turn it up 1 degree, 2 degrees. I like that you have information about the the amount that you’re saving every little bit counts and you know, every little bit that you bring your energy bill down is energy that isn’t being wasted for no reason whatsoever. So I just I really love this particular video, but your YouTube channel is filled with excellent tips. You’re known for teaching families how to be more cost effective and frugal. What are some other favorite hacks or tips that you have for our audience that they can do today?
Guest 2: One of the things that we’ve implemented is using power strips. Uh, I actually have an old-fashioned computer power strip that they used about 30 years ago where you had a button that turned off each aspect of a computer like the monitor, the printer, the CPU. I have lights plugged in around our family room into that unit and our TV and from where I’m sitting on the couch, I can just hit a button and turn this off, that off, that on. If we’re not using the TV, I shut it off on that power strip. There’s no Phantom power. Uh my receiver also uses Phantom power. It’s it’s a a Denon receiver with a remote. you know, I can shut all that down when we’re not using it. and I can shut lights off because I’m not having to get up and do it all the time. It’s really handy.
Guest 2: So, those are some things you can do. You know, we all like to think about getting a raise when we’re working a job. Now I’m retired, but when I was working, I couldn’t wait to get a raise. Well, if you want a raise, start implementing some of these suggestions and you’ll give yourself a raise in your income because your money is going to go farther.
Guest 1: One of the things that’s really important to think about is the fact that this whole idea of saving on energy is it’s very individualized because our house, built in 1958, it’s solid brick. so it tends to hold the coolness in longer than other uh homes which are are are not constructed of brick. And so it depends a lot on where you live. It depends on the square footage of your home, when it was built, how energy efficient that home is, how many energy efficient appliances are used. It is there’s such a huge array to look at. And that’s why when we began researching, we pulled every single strategy that we possibly could think of and implemented them a few at a time until we figured out what was working best for us to help us use less energy. And that may be different for you than it is for us.
Guest 2: One thing we started doing this year in terms of not using our air conditioning is at night, it gets really cool. Now if you live out west where it’s dry, it might drop 40 degrees from your hottest part in the day to your coolest part at night. If you have a whole house fan or if you have big window fans, turn those on at night, bring in all that cool air, then shut your windows in the morning, shut your drapes, keep the sun from coming in. You’ll be amazed at how cool you can keep your house during the daytime. and then at night repeat that same procedure. and this is what’s helping us not having to use our air conditioning.
Guest 1: The other thing we have, I mean we do have a certain amount, so we do have some portable power stations that we charge using solar panels and we implement those throughout the house to run some of our appliances. but even if you don’t have that, get yourself for about 40 or 50 bucks, you can get a solar rechargeable lantern. They’re fantastic at lighting up a room and they won’t cost you anything to use because after the initial cost, you’re sticking it in a window and you’re using solar energy in order to power that lantern. We have some that are our absolute favorites and we use them all the house.
Guest: This is so good. what I love about what you these last tips you’re giving especially and through this whole episode, um, is this idea of incremental change, and this is this is the same thing in finance. You know, we’re talking about utilities, which affects your finances because you’re saving the money on each of these changes. But just when we try to teach people, you know, if you save $10 a month and invest it, you save $100 a month and invest it, every little bit helps. Especially if you’re able to automate it, set it once and forget it, it becomes a part of your life, it becomes a part of your lifestyle. You don’t have to think about it anymore. It requires no energy from you to save that anymore. So that’s that’s awesome about, you know, all these different things that you’re you’re sharing today. Um, Larry and Hope, I am so glad that you were able to be on the show today. Thank you so much for being here. This is kind of a selfish show for me. I’m definitely going to be binge watching your YouTube channel to get these incremental changes uh in our household. and especially for me, it’s important for me to do the ones that I can do without impacting my kids and my spouse very much too. And there are a lot of them that you can just make some of these changes and you know, I I can hear some people maybe listen to the episode and say, this is going to be too hard to make my family go along with. And that that’s not the case. You know, some of those things can really go along just just fine in your daily lives and it’s not going to affect things very much. Larry and Hope, where can people find more about you if they want to find out more of these tips and tricks?
Guest 1: Ah, we have a website, underthemedian.com and also our YouTube channel. We’d love to have you come hang out with us at YouTube and it’s the channel name is under the median.
Guest: All right. thank you Larry and Hope for being here. Thank you so much. and for Mindy, this is Kyle Mast, signing off.
Speaker 1: If you enjoyed today’s episode, please give us a five-star review on Spotify or Apple. And if you’re looking for even more money content, feel free to visit our YouTube channel at youtube.com/biggerpocketsmoney.
Mindy: Bigger Pockets Money was created by Mindy Jensen and Scott Trench, produced by Calen Bennett, editing by Exodus Media, copywriting by Nate Weintraub. Lastly, a big thank you to the Bigger Pockets team for making this show possible. “}
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