Tuesday, June 30, 2009

End of Month Recap With Only a Minimum of Lying

On second thought, forget lying--I consider it more like financial misdirection.

First, my quarterly net worth update: I'm up $24,465 to a total net worth of $507,180. Really good, though it begs the point that the first quarter of 2009 was an all-time low economically. And that every other quarter, back to 12/31/2006 was higher. Also, given that the stock market is down today, but was up yesterday (the last full day that I could use for my calculations), chances are, my retirement funds are lower than the numbers I used.

See? Not exactly a lie, but not the full truth, either.

Second, my debts are down by $1122.26. These numbers are accurate. Sort of. I chart my credit cards by the last statement. What I ignore are any purchases made since the statements came out. So, either I won't reduce my indebtedness by as much next month or I'll have to make larger payments to the balances. My plan is to do the latter, as I have in the past, when I don't really want to admit I haven't been as frugal as I sometimes make it sound. My true goal (which I achieved last month and the month before) is to make NO new purchases on any credit card. I tell you when I do that. It's just that I don't always 'fess up when I don't!

Sunday, June 28, 2009

Immoral? Tacky? Or A-OK?

I'm curious about this, but just so you know--I already did it. My question now is whether I should feel guilty about it.

My (did I mention she is rich?) baby sister gave me a Kindle for my 60th birthday. Along with it, she also gave me a $500 giftcard from Amazon.

Obviously, the intent was for me to use the giftcard to buy books for the Kindle. Which I have, though I tend mostly to download the free books that are offered periodically. I never would have gotten a Kindle for myself but now that I have it, I find it handy for commuter-reading on the bus, and if I can ever afford to travel again, I think it will be great then, too.

But have you noticed that people tend to buy gifts for others that they'd like for themselves? Well, it became apparent to me that my sister would like a Kindle of her own. Given that she travels all the time, she would undoubtedly use it far more than I do.

First, I checked with her husband who was giving her an entirely different gift. Then I sent her a Kindle for her birthday present. It cost $349, which I did not have. So, I used that giftcard.

Hence, the question. Was it tacky to use what was essentially her money to buy her a birthday gift I knew she would like? Or was it the act of a loving sibling who really wanted her sister to have a birthday gift she'd especially enjoy? (Hmmm--Grace votes for the latter!)

I still have money left on the giftcard with which to buy books for my own Kindle. Does that make a difference?

Is there, in fact, any moral issue here at all?

Friday, June 26, 2009

Rx for Prescriptions

I remember spending nights with my grandparents (who lived next door--it was a SMALL town) and being freaked out at the number of medications lined up on their bathroom shelf.

That was a long time ago, and I'm now the grandparent, and yes, there is a shelf full of prescription medicines in my bathroom.

Not that I'm complaining.

The fact that I have taken blood pressure and cholestrol medications for the past ten years means that I was in good shape for my heart surgery in March, and contributed to my fast recovery. The medications I take regularly for diabetes are necessary for continued longevity.

But it's a darn good thing I have insurance and only have to pay a $10 co-pay for my prescriptions, because I take five different medications each day.

Lately, I've been searching for ways to reduce those costs. I already pay my co-pays with tax-free dollars since I have a flex medical account. But what other savings might there be?

As it turns out, I had to look no further than my HMO pharmacy. To go into the clinic monthly costs $10 per prescription, not to mention the time loss. But if I buy a 90 day supply of each medicine, I can do that for $27 per prescription plus make 66% fewer visits to the pharmacy.

But wait--there's more!

If I order by mail or over the internet, I can get a 90 day supply of each medicine shipped to me for $20 per prescription. (The package is pretty large--it probably does NOT make my mailman happy.)

Don't have an HMO? Maybe, don't have insurance?

Wal-Mart runs a cost-effective program for the most-used prescriptions. I checked their list of $4 medications, and it includes every one of mine with one exception (I was initially prescribed the most common blood pressure medication, but 10% of users develop a really loud and annoying cough. Wouldn't you know it, Grace is in that 10%). Wal-Mart also provides an additional discount for the purchase of a 90 day supply ($10) bringing the cost of common drugs down to $3.33 a prescription.

I'm not the biggest fan of Wal-Mart, but you can't beat those prices.

I know that I will, at a minimum, start getting my prescriptions by mail. I haven't decided if I will (or even if I can) forego the HMO pharmacy in favor of Wal-Mart.

In the meantime, I will hope that I don't ever contract the infection that a close friend of mine recently did--the drug that ultimately knocked out the bacterium cost her $495. And that WAS the CO-PAY!

Friday, June 19, 2009

Postal Ponderings

There I was, hanging out at the local post office with two packages: a yellow box emblazoned with hearts and filled with shoes, socks, and books for a grandchild who lives out of state who is having a birthday; and a more demure bubble-wrap-envelope filled with Skittles, jerky, fruit roll-ups, and underwear for a grandson who is spending his summer working for the US Forest Service.

I was prepared to pay big bucks to send these packages out in the fastest reasonable manner. But what shocked me was that the faster Priority Mail (will get there in 1-2days) was only 47 cents more than the slower Parcel Post (projected arrival in 5-9 days).

What gives?

According to the person stamping my packages, the recent postage price increases (you know--the one where you're now paying $ .44 cents for each letter you send) also increased the rates for Parcel Post but NOT for Priority Mail.

This results in the two rates usually being with $.50 of each other.

This also means that the post office got an additional $.47 from Grace because why bother with Parcel Post at these rates?

Perhaps I should keep quiet about it--I have a feeling the government's response would be to RAISE the amount needed for Priority Mail!

Thursday, June 18, 2009

Retirement, Defined. Or Not.

CNN blogger, Jack Cafferty had an interesting question today. Has Your Definition of Retirement Changed? Among the usual political responses (let's blame the Democrats, the Republicans, Obama, sunspots), smug "I'm doing fine, thank you, and I could care less about those who aren't" declarations, and concerns raised by Gen X and Y'ers, are other comments both wise and funny.

Absolutely, my definitions of retirement have changed.

I believe we've all had to rethink exactly what retirement will mean to each of us. It's not only the money, but the time. As retirement draws closer for me, I've started to realize I must make lifestyle plans as well. What I discovered during my recovery from heart surgery was that days filled with books (even good ones) and TV (even good. . .oh never mind!) quickly breed boredom.

I don't share the paranoia of some of those who responded to Cafferty's column. For example, I'm quite confident Social Security will be around for coming generations. But this particular recession has been a wake-up call for everyone. We just can't count on the things some of us thought would always be there: ever-rising markets; lasting good health; an encompassing sense of having made it.

Tuesday, June 16, 2009

Poverty Economics 101

Thanks to Single Ma at Fabulous Financials for referencing this Washington Post article about the high cost of being poor.

I live in a transitioning urban neighborhood that has traditionally been home to a majority of African American residents. Over the 16 years I've lived here, it has become increasingly trendy. That means we finally got a supermarket--two of them, in fact. But for years, the only grocery stores within walking distance were small and expensive neighborhood operations. The housing stock is old--great for yuppie rehabbers, but less satisfactory for families who have lived here since their homes were built in the 1930's and '40's. We have the second highest crime rate in our city, recently edged out of first place by a low-income white neighborhood on the other side of town. Our insurance rates reflect this.

Professionally, I work with and for poor people. For all my whining about my finances, I am grateful NOT to be in their shoes. I DO have a washer and dryer. I DO have the funds to replace my ten-year-old van when it finally dies. I DO have a bank account--more than one, in fact, so there's no charge to cash my checks.

Recently, a friend griped to me about all the "benefits" a "welfare mom" gets. He started off with subsidized housing. I responded that in our city, less than 12% of the poor have subsidized housing. The rest pay market rates for what are often substandard apartments--the kind of places that don't ask questions about prior evictions or require that the family make 3 times the rent each month. He was surprised to find that food stamps are based on a PERCENTAGE of what a single person or family needs to feed themselves for a month, and that the percentage is NOT 100%.

As the Washington Post article says, "You have to be rich to be poor."

Friday, June 12, 2009

Loving My Kitchen

My (rich) sister's Christmas gift to me was a complete interior repainting of my house. The entire residence looks 100% better, but nowhere did the paint make a bigger difference than in my kitchen.

Keep in mind that my kitchen had blue plaid wallpaper which was coming off the walls. I'm not sure that the wallpaper could ever have looked good, even when new. But it was especially unattractive as it peeled. Now that the wallpaper is gone, and the walls are sage green, one can safely cook in my kitchen without wanting to throw up. (There will be no cracks about my cooking--I'm talking about walls, here!)

The kitchen also came with fake oak veneer cabinets. Amazingly, these look a lot better now that they are painted white and the wooden knobs have been changed out for ones made of brushed nickle.

I'm happy with the new look.

But I'm getting a little tired of folks who keep asking if I was going to have granite counters and stainless steel appliances installed.


I wouldn't have granite counters put in even if I could afford them, which I can't.

In fact, I don't get the attraction of granite at all. It's expensive; it's heavy; it's easily stained unless properly sealed; it requires maintenance that I'm unlikely to do; dishes break when dropped on it (something klutzy Grace does all too often); it dulls knives if you cut on it; and it can crack if stressed.

My counters are formica and they work just fine. If I felt I needed new counters, I'd likely get more formica, though perhaps in a different color or pattern.

My real point here is that if granite really isn't optimal in a kitchen, why are all the "in" remodelers and designers using it? Why are people paying a premium for homes that have it?

I feel the same way about stainless steel appliances. Why get something that is a magnet for scratches and fingerprints, requires significantly more expense and maintainance and doesn't work any better than a regular appliance? (Oh, and speaking of magnets, WON'T allow you to stick one's treasured magnets on the front of it!)

Isn't it all a bit precious and silly to pay extra for items of decor that don't enhance the function of the room or the activities that take place there?

Or am I just being cheap?

Sunday, June 7, 2009

The Not-So-Financially Grown-Up Kids

While I'm not certain that Jung got it right about Synchronicity, there are still plenty of examples in daily life. Witness my thoughts about giving money to my children, which coincided with a "Ask Amy's" column in Today's Washington Post and a new entry on World of Wealth. [You may have to register to get on the Washington Post site, but registration is free.]

Amy's inquirer and Meg's family are at opposite ends of the issue. How do you handle it when you don't have the money to keep on giving the way you used to, or how do you make decisions about giving the money, when you do have it. Meg, of course, has the "problem" of how to graciously accept the gifts--we should all have her issues!

I note that many of the personal finance bloggers and those who comment on the blogs either have no adult children or have no children at all. Frankly this makes it easier for them to stand back and insist that one's adult children "stand on their own two feet." I will be interested to see how it works out for them as they do have families, and their children become adults. Given that many of us took to baring our financial souls on the internet because we were not exactly role models when it came to our own finances, will we be surprised if our kids aren't all that good at it either?

I've never had large sums to give to any of my daughters, but like the parents who wrote Amy for advice, my children do expect me to cover meals out, to help them with payments here and there when they run into trouble, to cover tuition and books for college (fortunately, my granddaughter is using the local community college for her higher education), and generally to "be there" for them financially. I don't think any of them has a clear idea of what I make or what my expenses are.

I have two conflicting mindsets about all of this. On one hand, I adopted children who were damaged, both emotionally and organically. I knew it was unlikely they would ever achieve my level of education or income. So helping them out has been built in to my parenting, and that did not end when they became adults and left home. On the other hand, we all have to be realistic. I cannot afford to support five families. I have to prioritize what I'm willing to give my children, and I do make an effort to equalize the monies that I give out.

I estimate that, on average, I spend about $600 a month on my children and grandchildren. Not all of that is spent in any given month, but I spend more than that three times a year when my granddaughter's college tuition comes due. So, $600 a month on average. That is money that could go a long way toward reducing my credit card debt.

I have not completely worked out how I feel about this expense. Right now, I include it in my budget. And right now, it is all financially doable. But I wonder how it will play out if/when I find myself in the position of Amy's letter-writer.

Thursday, June 4, 2009


BlueBird, over at Hedonic Adjustment posed an interesting question in his Tuesday post.

Bluebird asks his question in the context of union employees, but I think it is a fine question to ask generally: Why is the answer to inequity to make everybody as worse off as the worst?

How many times do we hear that "people on welfare" get too many freebies? Or complaints that too much of Obama's stimulus program is going to folks in foreclosure rather than those who are actually making their mortgage payments? Or rants against union employees with good healthcare benefits?

Why is the knee-jerk response to take away those benefits from the poor and working class rather than work to expand them into the middle class?

I understand envy. It's not like I don't get jealous of people who make more than I do, are smarter than I am, or have more opportunities than I do. But I don't see how my being jealous means they (whoever "they" might be) should make do with less.

Just so you know where I'm coming from--I work for a non-profit. Although I am an considered a "professional," my entire program is unionized, and I am currently president of my local. I make quite a bit less than I would if I worked for a private corporation. But I do have excellent health benefits (for which I and my recently unblocked arteries are duly grateful!).

Others with my education could have my health benefits if they worked here, but first, they would have to accept my pay. Like that is an option!

So is the answer to say that if one group can't have (because their employer can't or won't pay for it) my level of health benefits, then I shouldn't have it either?

In a different context, (and referring to a past post by Morrison at All Doors Considered), should the fact that an uneducated Deli worker from the projects got financial help from the government to move her family into a suburban home while a newly unemployed, college-educated banker is facing homelessness mean that we should never have helped the deli worker? Would taking funds away from her do anything for the about-to-be-homeless executive?

Somehow, I can't imagine those who "envy" the deli worker would really want to live her life in order to reap her "government benefits."