Archive for February, 2007
Here is the agenda for the annual financial meeting my nerdy husband and I undertake every February. I’ll write more about the results of this meeting tomorrow.
- Review Net Worth Report
- Review Cash Flow Report
- Discuss Major Expenditures
- Discuss Insurance (This year life insurance, last year disability insurance)
- Discuss Expected Tax Bill/Rebate
- Discuss Plan for Excess Cash (ex. CD – 1 year, 6 month, etc)
- Discuss Goals/Accomplishments from the previous year
- Write & Share Goals
- Ex. Retire @ 50
- Return to College
- Replace Furniture
- Assign a Time Frame to Each Goal (1 – 5 years, 10+ years, 30 years)
- Rank Goals
- Discuss Options to Achieve Goals
I just started reading The Laws of Money by Suze Orman. The first law, Truth Creates Money, Lies Destroy It, speaks to the heart of being honest with yourself and others about money. Suze steps you through the scenarios of former clients whose lies have resulted in insurmountable debt. For example, she tells the story of a young man who took an expensive vacation with friends even though he didn’t have money to pay for it. A month before the trip he was laid off from work, but still he didn’t tell his friends he couldn’t go. Instead he went with his friends accumulating $5,600 worth of credit card debt along the way. When he returned home, he learned that a major storm had swept through his area, and his home had been flooded by a hole in the roof. His car stopped running because the battery died, and while he was away someone called to offer him a job, but when three weeks passed without a response, they hired someone else. If the young man had been honest about his finances, he could have patched the roof before the storm came and accepted the job when the call came through. Instead, he ended up over $30,000 in debt, having to pay for the trip, the car, and the house, while remaining unemployed.
This story is clearly an extreme. But Suze also provides a common example of everyday lies about money. She describes two women. One is driving an older car and dressed in clean but unfashionable clothes. The other is driving an expensive high-priced car and designer fashions. Although the second woman looks wealthier, odds are that the first woman actually has a higher net worth. In fact, Suze says the second woman is probably leasing the car, has no savings or retirement plans, will never be able to pay for her child’s college, and fears she’ll be a powerless and penniless bag lady one day.
Whenever you buy something you cannot afford, you are lying to yourself. You are trying to be someone you aren’t, someone that at that moment in your financial time line you cannot be. Suze offers these tips to ensure you remain truthful about money:
- Tell yourself who you are, financially and in other important ways, by the choices you make with your money.
- Don’t be afraid that people will not like you if you do not have money.
- Be careful not to let the money you spend become a badge of your success.
- Each decision you make with your money puts you at a crossroads between truth and lies. One road leads to creating what you want, the other to destroying what you have.
Take advantage of free classes and services at the following stores:
- A.C. Moore
- Free and low-cost knitting, scrap booking, and cake decorating classes
- Auto Zone
- Free testing of starters, alternators and batteries. Free battery charging.
- Parenting & grand parenting classes from baby-proofing to child safety.
- Barnes & Noble
- Author signings, book groups, how-to-clinics and online courses
- Bass Pro Shops
- Workshops for dutch oven cooking, nature photography, and fly-fishing basics
- Destination Maternity
- Prenatal yoga, parenting and financial planning seminars.
- Home Depot
- Do It Yourself Classes including painting, wood-working, and deck-building
- How-to clinics on cleaning your garage, sealing concrete, and installing hardwood flooring
- Small business seminars and technology clinics
- Whole Foods Market
- Wine & cooking classes, healthy eating programs, and author signings
- Electrasol Gel (2) — $.35 (after $2 rebate & .50 coupon)
- Palmolive Dish Soap (2) — $.35 (after $1 coupon)
- Soleil Razors (2 packs w/ 2 bonus razors) — $1.88 (after $2 coupon)
- Softsoap Hand Soap (3) — $.82 (after $1.50 coupon)
- Softsoap Body Soap (3) — $.99 (after $2 coupon)
- Lemon Pledge — $1 (after $1 rebate & $1 coupon)
- Dove Milk Chocolate Almonds — Free after rebate
- Head & Shoulders Shampoo — $2.99 (after $4 coupon)
- Oral B Toothbrush — Free after rebate
- Sunlight Gel (2) — $.50 each (after $3 rebate)
- Lysol Wipes (2) — $.01 (after $2 rebate & $1 coupon)
- Dawn with Bleach (1) — $.49 (after $.50 coupon)
Every day it seems I have less and less time to stroll through personal finance blogs. But every day it seems there are more and more personal finance blogs to stroll through. I have a few blogs I try to read every other day or at least a few times a week. I’ve read some of the most popular blog lists, top 20, top 50, top 100, but most of them list the same blogs over and over again. I’m looking for less known blogs with a personal flavor. If you have a favorite blog you just love to read please tell me about it.
PayPal has a number of policies that really tick me off. For starters, they will not allow two PayPal accounts to utilize the same credit card. My husband and I have our own PayPal accounts but only one credit card. Originally my husband’s account was associated to the credit card, but when I won some online auctions I disassociated the card from his account and attached it to my own. Of course, life wasn’t so simple in the PayPal universe. In order to make the required transactions I also needed to have my account verified by associating it with a bank account. This required a two day wait while PayPal proceeded to deposit a couple of pennies into my bank account. This ticked off my husband who accounts for every penny in our bank account, and didn’t appreciate having to journal two unnecessary transactions.
So that’s not the worst of it. A few months ago my husband sold something on eBay, and the buyer paid us via PayPal. So my husband now has $50+ sitting in his PayPal account. But here’s the rub: I cannot get the money out of the account because the account is not associated with a credit card or bank account. In order to associate his account I would have to disassociate my account, and resurrect this back and forth behavior all over again.
The whole system is ridiculous. If there is money in his account, why do I need to associate the account with a credit card? I’m not asking for additional money, just the amount that’s sitting in his account. In the hopes of finding a solution that doesn’t involve disassociating credit cards and bank accounts I called PayPal. Oh, that was an awful mistake. After waiting on hold for what seemed like forever, I was informed by a PayPal representative that the system is intended to prevent fraud. In essence, she mumbled some garbage about trying to protect the end consumer, and that I should be thankful that the PayPal system tries so hard to protect it’s customers. So now I either have to go through all the trouble of reconfiguring our accounts or pay $1.50 to get the funds in the form of a check. I hate the idea of paying $1.50 just to get my own money.
Fortunately, or unfortunately, depending on how you look at it, most financial decisions are not made in a vacuum. It would certainly be nice to believe that we put our ‘thinking caps’ on before making every financial decision. That we save more often that we spend and that every decision results in the accumulation of greater wealth. But, truth be told, more often than not financial decisions are about more than just money.
Many times we weigh the monetary cost of financial decisions against the human factor. I think Suze Orman sums it up best when she says, “its people first, then money, then things.” In one of my all time favorite moments on the Suze Orman Show, Suze told a caller to take a trip to
Recently, I spent $262.45 on a digital picture frame for my grandmother. My grandfather, who passed away ten years ago, was an amazing amateur photographer. When he passed he left behind thousands of photographic slides. Due to the cost of processing film, he rarely developed the pictures he took. Instead, he would hold slide shows for the family, projecting hundreds of images onto the walls of his home. Of course, as children we weren’t interested in sitting for hours watching slide shows. Upon my grandfather’s death his slides were gathered together and moved into an old armoire chest. They sat and collected dust for years, until I decided to create digital scans of them. I painstakingly began to scan and catalog the images. With so many to scan I have only made a dent in the piles. I’ve scanned about 1,200 so far. Many of the images brought me to tears. Moments captured of my mom and dad at their first Christmas, images of my brother coming home from the hospital, and pictures of my mother and I that exude the love we hold for one another.
Realizing that my grandmother doesn’t have access or knowledge of a computer, I decided to buy her a digital picture frame to view the pictures. After a bit of research I decided upon the most expensive frame. Since my grandmother is 84, with poor vision, size and clarity are of the utmost importance. Ultimately, I picked the most expensive frame because it excelled in these areas. If money were the only factor, I may have chosen not to buy a frame or to purchase the most inexpensive one. But when I look at the pictures my grandfather took, I can only imagine the range of emotions he felt behind that lens. Within each picture I try to imagine the pride, joy, compassion, elation, and frustration he felt. To display the images on anything less than the best just wouldn’t feel right.
Dumb Little Man is holding a new contest asking bloggers for their best Personal Finance Tip. My best personal finance tip is as follows: When you are considering purchasing an expensive item, rather than buying it for yourself, consider buying it for someone else. The joy money can bring can be well worth the cost.
On Thursday night my husband and I drove down to North Carolina for the weekend. Rather than packing and preparing for the trip on Wednesday night we spent Valentine’s in front of the fireplace watching Lost and eating a late night dinner. On Thursday morning I had to rush off to physical therapy and didn’t have time to pack. Thursday night after a long day of therapy, meetings, and an hour and a half drive both to and from work, I came home too exhausted to think about packing. Instead I cleaned out the refrigerator, throwing anything that would expire into a cooler and tossing it into the trunk. In the mean time, it was getting late and my husband was in a hurry to get on our way. The trip to NC takes at least 6 1/2 hours, so I threw whatever I thought we’d need into the trunk and we headed out the door.
Yesterday as I was thinking about enjoying a dip in the hot tub I realized that I had forgotten my bikini. I remembered pulling it out of my drawer and placing it on top of my dresser, but I couldn’t remember much after that. I’m assuming it’s still sitting on top of my dresser. I really wanted to take a dip so I decided to head to the store in search of a ‘cheap’ swimsuit. I need another bikini like I need a hole in the head. I have at least three at home that I bought in after season sales.
Of course, it’s nearly impossible to find a swimsuit this time of year. Since it’s the off season in NC there isn’t a large selection of swimsuits to choose from and the ones that are available aren’t on sale. I could just kick myself for having to spend money on an item I don’t need. My failure to plan ultimately resulted in an unproductive trip to Walmart where I wasted time picking through unattractive, full priced bikinis.
Too bad my in-laws took the trip to NC with us. Had they stayed home I would have skipped the bikini altogether and just gone skinny dipping with my husband.
Earlier this week my employer announced that all active employees would receive a bonus. The details of the bonus were listed on the company website for all employees to read. I was a bit confused by the information presented. The notice detailed the number of shares of company stock provided to each employee, but also mentioned that a number of shares would be sold to cover applicable taxes. Based on the information in the notice it was unclear just how many shares had been awarded to each employee. I logged in to my bank account to verify the transaction and to determine just how many shares I received. The number was smaller than what I expected, (I always forget just how much money the tax man takes away), so I asked another employee how many shares were deposited in her account. She said, “I haven’t logged into that bank account for years.”
Rather than calling and waiting for a response from HR, I decided to ask another employee. The bonus was exactly the same for all employees, so I just needed one other person to verify the number I saw. The second employee also admitted that she had not logged into her account. I asked three other employees and received the same answer from each.
I couldn’t believe that no one had logged into their accounts to verify that the transaction took place. I started to wonder, if I asked five more employees would they have also given me the same answer? How many people would I have to ask, to find one employee who had actually verified the transaction? Are these individuals lazy? Uninterested in money? Do they know how much money they have in their bank accounts? How much money they’ve made this year?
I take money very seriously, maybe too seriously. But I have to admit I was surprised to find so many coworkers who didn’t even bother to log in to their bank accounts.
I recently signed up for a class at the Unversity near my home. I didn’t sign up for computer classes that would further my professional goals or writing classes that would further my personal goals. Instead, I signed up for Tai Chi and Meditation classes. For about $8 a class I drive over to the University and spend 1 1/2 to 2 hours in a quiet gym with a whole spectrum of strangers. Many of the participants are University employees or graduate students. There were a couple of undergraduate students in the first class, but it seems they have all dropped out by now. I have to rush home from work to get to class on time, which can be a bit hectic and stressful. It’s actually pretty funny how stressed I get, in part because the classes themselves are meant to alleviate the stress in my life. So far the classes have been a fairly inexpensive way to learn something new and meet new people.