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Posted by runsrealfast on April 23, 2008, 5:49 pm
>
>
>
> > >Just got a call from my supplier here in SE Iowa and their contract
> > >price for next year (if prepaid) is $1.929.....current price off the
> > >truck is $2.099. For comparison purposes we contracted 800 gallon at
> > >$1.569 last year. I realize that propane is normally less expensive in
> > >this part of the country than in most other parts but was just curious
> > >about prices elsewhere.
>
> > Yeah- I guess it's cheaper. Here in upstate NY I paid $2.70 last
> > July- and by Jan it was $3.30. [and stayed there through last month.]
>
> > >The bummer (besides the price) is that each year they keep wanting all
> > >of their money earlier in the year if you prepay. This year you must be
> > >paid in full by May 1st even though we will probably not start using the
> > >propane for heating until mid October.
>
> > They want to use your money for free. My gas company doesn't offer
> > 'prepay' or 'budget plans' for the little I use. But my fuel oil
> > dealer does. I've passed on the deal every year, but have noted the
> > offer and prices for the last 5 years. This is the first year it
> > would have saved me anything. I used $1300 worth of oil this year
> > & would have saved $150. But I would have had to pay$1200 last July
> > instead of pay-as-you-go.
>
> > In my extremely frugal moments I have considered buying a second 275
> > gallon oil tank and filling them both in the summer when I can get the
> > best deal from whoever I choose.
>
> > Jim
>
> Seems like the best thing would be to calculate how much interest it
> would cost you to borrow the cost of a fill-up, from say the bank, six
> months in advance of when you will need it?
> If, for example the interest rate is say 6% and it will cost $500 for
> the fuel, buying it six months in advance. 6% annum. on $500 = $30.
> So for half a year; it will cost you, in interest, about $15 to fill
> up 'now' rather than wait for start of next burning season?
> And if you could save that, or more, by the 'now' decision it's a no-
> brainer.
> Since many bank LOCs require a minimum monthly payment your monthly
> payout until heating season might be 2% = $10/mo, so that after six
> months you will have paid out $60 (principle plus interest) and will
> then owe at the time you would be buying fuel anyway, a remaining
> balance of about $455.
Instead of a loan most bank have some sort of revolving line of
credit. Might not be a bad idea if the interest rate is good.
John
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