2010--The Final Wrap-Up

The last quarter of 2010 made the rest of the year finally look good. My net worth is up $10,921. This is primarily due to my 401(k) which is still stock-heavy, increasing over $20,000 in three months. It is certainly not due to the real estate market in the Pacific NorthWest--both my home and my rental have decreased in value for the fourth straight quarter. But my rental is paid for, and my residence will be in three and half years.

So, my current net worth is $565,851.

I do love the sound of that--Hey there! Grace is worth over half a million!

Of course, Grace still has much too much debt and not enough in her retirement funds.

I managed to stick to my Christmas budget so I also managed some minor debt reduction during December.

Hmm, minor, indeed! A whole $317! But at least it was moving in the correct, downward direction.

As for 2011--I've made the usual resolutions, and I'm hoping for better than usual results.

I want to reduce my debt by at least $10,000;

I want to increase my savings, both for retirement and my emergency fund.

Speaking of which, I'd like 2011 to be the year I actually keep a baby emergency fund. Right now, it's there, but contains only $700.

Here's Grace, raising her cup to all of you, and wishing everyone a truly great and enriching (in every sense of the word) new year.

Some Thoughts on the Christmas Season

Christmas was quiet but pleasant this year. The best part was that I stayed within my budget.

1. My very best Christmas bargain was at The Body Shop. First, I purchased a $40 Groupon for $20. Then, when I went to the store, they were having a special promotion. If I donated $5 to their "Stop Sex Trafficking" charity, they gave me a small bag. Anything I put in the bag was 50% off. The end result was that I purchased $70 worth of stocking stuffers AND donated $5 to a worthy charity, all for a grand total of $20. That may be the best deal I got all year.

2. I broke with the "Grandma provides Christmas dinner and feeds everyone" tradition. This year, I made a ham rather than a turkey, and set up a buffet. Family could come by whenever they wanted. It went so well, I may do it again next year.

3. There are so many free events and things to do during the Christmas season. I made a special effort with my grandkids to check these out. We drove around looking at 'over the top' Christmas decorations. We went to the Zoo to ride the Zoo Train and look at all the lights they put out (free with my annual pass). We hit every church Christmas concert within half a mile of my home. I did get a tad overdosed on frosted sugar cookies, but the kids and I had a blast.

4. I caught a post-Christmas cold from one of my grandkids. You'd think that was the bad news, but it has allowed me to stay on my couch, away from work and away from people, watching all the bad television I want. Rather a nice Christmas present actually!

Retiring with Debt

The Christmas season is probably NOT the best time to bring this up (or maybe, it's the perfect time!) but a surprising number of seniors are retiring notwithstanding the fact that they have not paid off their credit cards. In fact, according to this article in USA Today, some seniors are accumulating debt during retirement that they have no way or intention of paying.

I do find this shocking.

My general scenario (barring job loss or crippling health issues) is that one pays off the house, credit cards, etc. BEFORE retiring.

It's not like retirement is likely to bring in EXTRA income--that pie we spent our working lives accumulating is being sliced into ever-smaller pieces once we retire.

I will say that the part of the article I don't have a lot of sympathy with is the failure of retirees to leave an inheritance for their children. While I want to give my children something, and do expect to, it is NOT my children's right to expect that I will. My retirement funds are meant to fund MY retirement, not anyone else's.

Right now, working is important to me, both emotionally and financially. I could not fund my current lifestyle (meaning, my current debt payments!) on what I will have during retirement even counting Social Security and my 401(k). In fact, I've always wondered about folks who expect to rent throughout their retirement. Having my mortgage paid off (which it will be in 3.5 years) is a major factor in my ability to retire.

I wonder if this has to do with being a Baby Boomer? Do we just consider credit cards and credit card payments and mortgages part of life--that lasts until we die?

And beyond?

What to Give the Person You Love But Don't Like

Suppose there is someone--a family member, or, maybe, a longtime friend--with whom you've had a strong and loving relationship and to whom you have to give Christmas gifts.

Then suppose that for some valid reason--addiction, mental illness, criminal behavior--it's become impossible to like this person even though you still love them.

What IS the perfect gift for the person you care about, but no longer care for?

Sadly, some of us get to contemplate that question this year.

My second daughter, whom I adopted when she was 11, has had a chaotic life. Too many truly evil things happened to her in her first 10 years to make the next 25 years easy. In addition to a high level of continued emotional disturbance, 2010 was the year she turned to methamphetamines. That led to the state removing her children and placing them with their fathers.

She has yet to address her addictions.

Right now, she is angry at the judicial system, angry at the world in general, and, in particular, angry at me.

Needless to say, I'm not very happy with her, either.

But she IS my daughter. And I've never NOT given my children Christmas presents.

So--what to give her?

She could use a good pair of shoes, but the last time I bought her a pair of Nikes, she turned around and sold them. Ditto for any electronics.

I could save my money and skip the gifts for her.

Or I could be snarky and donate money in her name to some treatment program.

In the end, I got her socks, underwear, pajamas and a robe. My thought was that these were quintessential 'mother' gifts, having the requisite intimacy that befits a loved family member without spending a fortune or making it easy for her to come up with money for drugs.

Next year I hope to do better for her. But first, she has to do better herself.

Asking How You Feel May Not Give You the Right Answer

Three months ago, after being on diabetic medications for eleven years, I moved to insulin. Instantly, my glucose numbers went down--which is good. But the question I most often get is "Do you feel better?" Well, given that I didn't feel particularly bad when the numbers were high, and given that there hasn't been much of a change in my vision and some mild neuropathy, the truthful answer is "No, I don't feel any better." That's how I feel. But medically, things are much, much better for me. That's the real truth, never mind how I feel.

I was thinking of this while reading PoltiFact's take on President Obama and the state of the economy. I love these folks, and their 'plague on both your houses' approach to monitoring what politicians tell us for the truth (or NOT!) in their statements. Democrats and Republicans are equally irresponsible when it comes to saying what's on (in?) their minds, notwithstanding the actual facts.

Questions like "Are you doing better this year than last?" seem simple enough, but like questions about my diabetes, the answer is more complicated. Yes, I'm doing better, but No, I can't really tell that I am. I don't FEEL any better financially this year than last. I don't FEEL like the economy is getting better.

Yet, in significant ways, it is. While housing and jobs lag, the economy IS growing. That's not clear if one listens to the 'Obama is the devil-incarnate and nothing he says or does will ever be right' types.

Sometimes, it's good to remind ourselves to take a good look at the facts, and not just let our personal feelings be the gauge of what is actually happening.

That's true when it comes to our personal lives, and our financial lives, not to mention our political lives.

This Post is for ME, Not YOU

OK, I admit it. I love journals and writing books of all kind. The prospect of getting a Daycraft journal for free from Notebook Stories just by posting this on my blog was entirely too enticing to pass up.

I'm keeping my fingers crossed till Friday.

Hmm--which does make keyboarding a tad harder!

The Best Presents Ever

I mean real ones--NOT some sappy "the smile in my darling child's eyes' kind of presents.

My sister spent a week over Thanksgiving with me, and at one point, we talked about the best Christmas gifts we ever received.

My sister remembered the Kodak Swinger camera she got when she was in high school in the '60's. I remember that one, too, because I was SO jealous. It was a Polaroid camera that allowed us to see the (small, black and white) pictures immediately after she took them. It was quite the process--take the picture, lay it out flat, rub it all over with this tube of gunk, then sit back and bask in the admiration of all her friends. I know it doesn't sound like much in this age of camera phones, but you have to trust me--it was a really big deal and a wonderful gift.

I can think of two gifts I've received in the past ten years that I love and still use--one is a very slender 4 cup Nissen thermos bottle. It fits in my briefcase and has saved me untold amounts of money that would otherwise be spent in coffee shops.

Another is a pair of YakTrax. These are essentially chains for one's shoes. They fit over the bottom of boots or shoes and keep me upright on icy sidewalks. (The picture shows them being used over heavy shoes, but I've worn them on the bottoms of my work flats.) I'm a large and clumsy woman at the best of times--if it gets icy outside, forget it! But I've never fallen, never even slipped, while wearing these great contraptions.

I've asked a bunch of folks over the past week about their best-remembered gifts. Funny how none of the responses were about big-ticket items.

One woman treasures the (umm, can you say UGLY? I can because I saw it!) Christmas pin that her then-four year old son bought her one year. He's 35 now, and still sends her, among other presents, one ugly Christmas pin per year--that collection has made her laugh for two decades.

Another woman is still using the one-cup Chem-Ex coffee-maker her two step-sons bought her nearly twenty years ago--she says she thinks about those kids every morning when she uses their gift.

But the best gift I think is the magnifying glass an old friend of mine got from her big brother one Christmas. He really wanted it for himself, but he bought it for her. Up to that point, she was a girly-girl, and, in fact, I first met her when she offered my doll a ride in her doll's baby buggy when we were both five years old. But that one little gift opened up a world of science to her at at time when most girls didn't go there. She's been a biologist her entire adult life. Three weeks ago, she retired from a mid-west University.

Yes, she still has the magnifying glass. These days, she uses it to read the daily paper.

Managing the Many Moods of Christmas

Maybe it's just me, but I seem to have so many different moods when it comes to Christmas spending.

I was thrilled to pick up two Christmas ornaments at Hallmark for 95 cents each using two $5 off coupons that were in my local newspaper. (I traditionally put a new ornament in each daughter's Christmas stocking.) Then I turned right around and paid full price ($99)for a Wii FIT for my oldest daughter even though I've seen it on sale for $20 and $30 less.

Obviously this makes no fiscal sense.

At various points during the Christmas frenzy, I get tired and just want to get the shopping done, never mind the cost.

The other day, I could not locate the one document I needed for a $30 rebate on a telephone for one of my kids. I was ready to say "Forget it," when calmer heads prevailed and I did, indeed, manage to locate the errant barcode.

But it is SO easy to just let things go, pay the full price, and move on.

I'm still within my budget this Christmas, but I'd better get a handle on my moods or that may not remain true.

Some days, I'm with Scrooge!

Bah Humbug, indeed!

Monthly Report and Miscellany

1. My total indebtedness is down $705.50 for the month of November--right direction if not a big enough amount.

2. After taxes and other charges, I didn't save quite as much per month on my change to bundled cable TV, telephone and internet. My increased expense for adding the internet will be $9.48, rather than the 43 cents I thought it would be.

3. Is anyone else watching "Downsized?" I am fascinated by it, and I think it shows a rather accurate portrait of a family that has never known financial hardship finally come to grips (albeit SL0WWWLLLLLYYYYYY!) with the reality of their situation.

How Grace Got her Internet for 43 Cents a Month

Well, let's start with the fact that Grace has been using a combination of dial-up from AOL and theft from an unwary neighbor to get online for the past 16 years. Said unwary neighbor recently wised up and secured their system. Dial-up alone suddenly became a slow and unnattractive option.

SO--I began exploring various options for internet. Verizon Fios has not yet reached my neighborhood, so that was out. Pretty much, Qwest, Clear and Comcast were my best sources of internet service. Clear has such negative word of mouth that I rejected it even though its monthly $35 charge is among the lowest available. Both Qwest (who handles my landline service) and Comcast (through which I currently have cable TV service) have regular specials, so it was a matter of sorting through all the plans, specials, new deals, etc. to see what would work best (and longest) for my household.

I settled on a Comcast introductory package that offered a bundle of cable, telephone and internet for $99 a month on a two year contract.

There was a 'cheaper' package whereby I could get the same package for $89 a month, but it lasted only a year and did not include free installation (which runs anywhere from $89 to $149.00).

Naturally, the $99 a month did not turn out to be $99. (If you think any of these special deals actually cost what is advertised, I've got a bridge in Brooklyn for sale that you might like!) There's an additional $5 'rental' fee, which brings the total up to $104.99 a month. There is also a one-time $10 shipping charge for the 'free' router (which I have to give back if I cancel the internet service).

But that was it. And there are a lot of nice perks. For example, while I had Qwest for my landline, I didn't have long distance--for that I used a calling card or my Tracfone. Now I have long distance, caller ID, and call waiting. I was able to port my telephone number. It would have been a deal-killer if I hadn't been able to do that--I've had the same number for the past twenty years and do not want to give it up. The only disadvantage is that if the electrical power goes out, I won't be able to reach 911 on the landline. But I figure my cell will work for emergency calls should that happen.

I also get HD for the first year. I plan NOT to renew it after that, though my cynical daughter has a bet that I will! If I do, it would add $9.99 a month to the bill. In addition, I get HBO, Showtime and Starz movie channels free for three months. I'm enjoying them, but there's no way I'll continue with them when the free trial runs out.

So, here's the math:

I currently spend $67.25 for cable TV; $14.49 for AOL; and $27.35 for Qwest which (provided I am doing the arithmetic correctly, which it might be a mistake to assume) totals $109.55 for my current expenses.

Under my new package, I will pay $104.99 for the package plus an additional $4.99 to AOL to maintain my security software, e-mail address and some other perks I may ultimately decide to forego. So, my total going forward will be $109.98.

Hence the internet (not to mention free long distance service) for $ .43.

Such a deal!

Adoption for Cheapskates

Do you hate that title? Are you appalled that anyone would consider applying frugality to the adoption of children?

What if it turned out that being frugal about adoption actually helped those children most seriously in need of parents?

Welcome to Grace's world, where the desire to adopt and rear children ran smack into financial reality. Don't worry--this is a story with a happy ending. I wound up adopting five daughters, and we all survived.

I was 30 years old when I adopted my first child out of foster care.

I was 50 when I adopted my fifth and last child, also out of foster care.

They are all adults now, ranging in age from 43 to 20. They are mostly on their own. (OK, so the 28 year old returned home and is currently living with me, but the plan is for her to be gone by spring!)

Rearing children is never cheap and my children are no exception.

But the adoption process itself can run into thousands of dollars, particularly for children from foreign countries, and even more particularly for the near-mythical 'healthy white infant.'

My children's adoptions cost me not one dime.

My state paid the attorney fees.

My state provided health insurance until they were 18. (I put each child on the insurance provided by my employer and used the state coverage as secondary insurance, which meant I had no co-pays!)

My state provided psychological testing at no cost.

My state even provided a monthly stipend for each child.

If you're curious about your state, the National Council on Adopted Children maintains this website.

The federal government also provides tax benefits for families that adopt. It benefits those of us who adopt special needs children from foster care most of all. (Special needs can mean the child has physical, intellectual or emotional issues. It can also mean that the child is above six years old, is African-American, or comes with siblings.) Everyone can get a tax credit up to $12,150 per child, but those who adopt from the state can get it whether or not they actually spend that much (which they won't--they may well not spend anything) and they can even use it for costs incurred for an adoption that winds up not happening. Check it out here. The credit can also be carried over to the next year if one's tax bill doesn't come up to the credit.

All states require that prospective parents thinking about adopting from foster care take a series of classes meant to introduce families to the realities of rearing adopted children. (No, it is NOT the same as rearing biological kids--neither better nor worse, but different.) These classes are free and provide a great deal of information about the available children. I would encourage everyone considering adoption to take the classes even if they think a state adoption is not for them.

There is so much more to be said about adoption from foster care, and so many other aspects to factor into the decision, but this is a financial blog, so this post is focused on the finances of adding adopted children to one's family.

Cheapskates can adopt. Grace is proof of that. Would I have adopted had the state aid NOT been available? You bet. But I would have stopped with the first, maybe the second child. I could never have adopted all five without the benefits provided by the government, so I am grateful for the programs that were and are available.

November is Adoption Month.

Consider it!

Hitting a Mental Benchmark

The retirement funds in my 401(k)'s are now past the $200,000 mark. To be exact, as of yesterday, I have $200,451 to get me through my dotage.

I know that that figure could be less tomorrow, but, emotionally, it feels like I have met some sort of financial milestone. In my head, and for no particular reason, I've always felt that I needed to have at least $400,000 in my retirement accounts before I retire. Due to my late start on savings, there has been considerable doubt that I'd get there. But reaching the halfway point gives me more confidence that this is doable.

I have 8 years to go until I retire, and I'll be contributing all the while.

Realistic or not, I'm feeling good this lovely Friday!

October Update--It's Halloween and It's Scary

This should be my last month of increased indebtedness, now that the final payment on the rental's new roof has been made. That's assuming that I don't borrow any money for Christmas.

Well, heck, let's assume that, OK?

My total indebtedness increased in October by $1044,85.

That means my year-to-date decrease in debt is a mere $1158.

Basically, I scrambled to pay off debt for 8 months, spent like crazy for two months, and here I am!

But I have slashed my Christmas budget (remember, I'm the major buyer of gifts for 12 folks!) and I'm thinking I'll get through the holidays without using credit cards, lines of credit or any other form of debt.

After that? A whole new year with new frugal resolutions!

Groovin' on Groupon

I love it when great minds get in the same groove! Witness Donna Freedman at Surviving and Thriving. She and I are both having great experiences with Groupon.

I've been a member of Groupon for awhile now, but haven't actually used one of their coupons until last week, when all of a sudden there were two coupons that would save me money for things I'd buy anyway. One was to a local restaurant that my soon-to-be 26 year old daughter already told me was her choice for her birthday dinner. (This is my Halloween baby--it was so great when she was growing up--I never did have to decorate for her birthday!) The other was today's coupon for The Body Shoppe, where I do a fair amount of my Christmas shopping. In both cases, I paid $20 for a $40 coupon. In both cases, I saved 50% on items I was already going to buy, even at full price.

The point of Groupon is to get folks to try new places and new services. From a frugal point of view, this is not always good. It can be hard to resist a bargain on something I didn't know I wanted until the coupon became available. At least in my city, many of the trendiest salons and restaurants are featured. It would be easy to overspend on things I was interested in trying were my finances not an issue.

I'm excited to see what other groupons may be available between now and Christmas.

Cheers for Happy Hour

I'm a bit late to this party.

But late or not, I've become a huge fan of happy hours.

I remember when the only folks dining before 6:30 p.m. were seniors and families with young children. It was a sure sign that one lacked culinary sophistication if one showed up earlier. And if it was a buffet? Well, never mind, but keep on wearing that polyester leisure suit!

There's been a lot of employee turnover in my office recently, which has resulted in many new, younger hires. One of the side benefits has been a lot more interest in happy hours at local bars. No, this isn't the local buffet--much trendier than that! I live in a city that prides itself on its food options, so virtually every 'happening' restaurant has a bar, with a happy hour that mostly runs from 5 p.m. to 6:30 or 7:00 p.m. (Often, another happy hour kicks in around 10:00 p.m. but by then, this senior is in her jammies, parked in front of the television set.)

I've been amazed at the food and drink options as well as the prices. Yesterday evening, for example, seven of us went out. Cocktails were $5. Wine was $4. Beer was even less. The food prices topped out at $6 for the calamari. I had Phad Thai ($3) and french fries ($2) plus a drink (OK, so neither the diet police nor the nutrition monitors were around!) for a grand total of $12 including the tip. I sneaked a peak at the dinner menu where the same order would have cost me over $20. As long as the food and drinks were served before the end of the happy hour, we could hang out as long as we liked.

Going with a group is part of the fun and saves one from the singles' "are you dating material or not" action at the bar. (Of course, if you're into that, there's another reason to go!)

If, like me, you find going out to eat to be one of life's special pleasures, happy hours are an especially frugal way to do it.

Roadblocks to a Successful Retirement

I always enjoy reading Liz Pulliam West's financial columns, but this one hit nearly everything one must consider when retiring, and all in one post!

Liz covers the 5 ways to wreck retirement:

(1) Think only about the financial side. Certainly saving for retirement is a preoccupation of mine, but Liz is right--it is important to consider one's health, one's relationships with friends and family, and the hobbies or activities one wants to continue or newly develop in retirment. It would be a shame if I finally get to my retirement with sufficient money but lack the health or brain cells to enjoy it.

(2) Fail to get a second opinion. Mea Culpa! Before I get to retirement, I have to remind myself to set a date with a fee-based financial planner. I'm pretty sure I'll do this. BUT will I follow the advice I'm given? For someone who has never been good with numbers, I still trust myself to manage my finances--I need to consider that this may NOT be a good thing.

(3) Fail to understand Social Security spousal benefits. OK, not everything Liz says is relevant to Grace! No spouse, no issue for me here.

(4) Skip formulating a Plan B. Hard as it is to imagine, I agree that one must have a back-up plan for contingencies. Can I count on my health being stable? I've already had major heart surgery--what if I need more? What if my job goes away? It could happen since I work for a non-profit that is dependent upon public funding. What if the need to provide a home for my grandchildren requires that I cut back on my work hours, and therefore my earnings? Too many possibilities to be safely ignored. And

(5) Gut your nest egg early on. This is a warning that too many failed to heed in the first days of our recession. My plan is to try to maintain my lifestyle on what I get from Social Security--something that may be doable when I get my home paid off and erase all of my debts. That way, my 401(k) withdrawals will be largely for the extras like travel. But I also have to realize that it is in the earliest days of my retirement that I will be most likely to travel or pursue more expensive activities. So, at the exact time I should NOT be withdrawing funds, I'm going to want to. Definitely something to think about.

The "Am I Ever Going To Get Out Of Debt" Blues

How many times have I read bloggers who make statements about how their life is going, and say they're fine with it, when anyone can read between the lines and easily see that they are not fine at all?

Time to count Grace in that crowd.

I took a look at where I was financially when I started this blog in June, 2007. I then compared it to where I am now.

The picture is NOT pretty!

It is, in fact, worse than I expected.

On the savings side, things are the brightest. I had $167,166 in my 401(k)when I started. That fund now stands at $195,871, an increase of $28,705.

But debt?

I kinda thought that paying attention to my debt, becoming frugal and entering a learning curve regarding smart financial practices would put me on the right path. If so, there have been a lot of potholes on that path!

My total debt HAS gone down in the past 3.3 years--a whopping $1034!

Longtime readers know that's not the whole story--I HAVE been paying down my debts, but along the way was the van that dropped dead, a rental that needed first a new furnace and then a new roof, children that needed various bail-outs, not to mention a wonderful but not exactly frugal trip to Japan.

But what am I telling myself?

That I'm OK, that I would have been in even worse shape had I NOT paid close attention to my spending, that once my mortgage is paid off (in 4 years) I'll be able to throw that entire monthly payment at my debts and have them cleared out by the time I retire.

It's not a great plan, but at the moment, it's all I've got.

Annuities? From Never to Maybe

There are various ways to grow financially.

And not all of them are actually financial!

Sometimes, there's emotional grow as well, a matter of changing one's mind.

I'm getting there when it comes to annuities.

I know that we old fogies are supposed to be set in our ways but life has a habit of changing things. Witness my previous, long-held aversion to bonds. Nothing like a recession to rearrange one's priorities! I'm now upping my bond quotient, which, at my age (Ahem! Umm--61) is probably long overdue, though it has taken me some time to come to that conclusion.

Now I'm rethinking another aversion--to annuities.

This article, by Money Magazine's Walter Updegrave, not only mentions my major concern (that annuities are too expensive for the benefits they grant, particularly if I exit this mortal coil sooner than expected) but has some solutions that provide safety while not tying up all one's funds.

I expect to retire with around $400,000 in my 401(k), which, with my Social Security, should provide me with about $50,000 a year. Since I calculate that I really only need about $36,000 after taxes to live comfortably in retirement, I could afford to put at least $100,000 into a guaranteed annuity. Unfortunately, there is no pension in Grace's future.

I haven't made any final decisions, and don't intend to for a few more years. I figure the payouts can only get better, given how low they currently are.

But unlike past decisions to never consider annuities, these days I'm listening. And reading. And, yes, considering them.

When Two Wrongs Turn out Right

This story from the Sunday Oregonian caught my eye today. It contains so many financial lessons about rebates, how our minds work when it comes to using rebates, and the power of polite preseverance even when we're in the wrong.

I am a rebate-queen. While I understand that some corporations count on buyer inertia to keep many from applying for their rebates, they won't make money off Grace. I read the rebate forms carefully, cut out all the necessary UPC codes (Yes, my darling children, that explains the holes in the boxes of your birthday gifts!) and mail everything the day I make the purchase. I even xerox the forms and attachments before I put the rebate in the mail. Then I track the rebate online.

But at least once, I fell into Brent's trap of not using the rebate card when it came in the mail. Checks are different--I deposit those immediately. Why? I couldn't tell you. It's the perverse way my mind works--checks are meant to be deposited; Gift cards? Sure, I should use them right away. But I don't always, and I sometimes lose money when I delay.

What I haven't done in the past (but will, I hope, do in the future) is ask for the gift card to be credited anyway. It just never occurred to me, but Brent is right--what is there to lose by asking?

Several good lessons to be learned here.

Quarterly Net Worth Update

My net worth is down $2704 from last quarter, but is still over half a million, at $554,931.

The housing debacle came late to the Pacific Northwest, but all that meant was that we are recovering later as well. My city residence went up $5000 in value, but my rental on the coast lost $20,000.

What? They didn't see the new roof?

Speaking of which, my indebtedness increased $2654 which is due entirely to the roofing costs, and wait! There's more! $2000 more which I will be paying in October.

But my 401(k) is up $23,000 so I'm not really complaining.

All in all, I'm not unhappy with my net worth at this point.

Rest in Peace, Tony

From the first week I started blogging, I had a regular in my comments section. It was Tony from My Road to Freedom.

He was always generous with his encouragement as I marched fitfully forward in my journey toward financial freedom.

He was already there, though not without some fitful progress of his own. He took his losses and was searching Florida and other parts of the country for some land to buy for his RV. I was delighted to share his journey via his blog entries. He signed all of his comments as "Did It My Way," and ended each with "See ya."

In person, we might not have been friends. He smoked. He loved guns. He didn't like land-use planning laws.

But on the internet, these 'indiscretions' paled next to his spirit, and the excitement with which he approached the world and his retirement.

I've been annoyed that he hasn't posted recently.

I shouldn't have been.

I should have known it would take something like death to keep him away from his blog.

Tony Cassise died July 29, 2010.

May the earth rest lightly upon him.

See ya, Tony. Kinda wish I'd seen ya around a whole lot longer.

On the Job--Kinda, Sorta

The Boston Globe profiled several people who have, at long last, managed to find new jobs in this recession. [Yes, I hear the recession is over and has been for awhile. But an awful lot of employers out there don't seem to have gotten the memo!]

What interested me the most was how all of those who were profiled remained active in the workforce, by volunteering if nothing else. It appears to me that one can sit in one's jammies in front of a computer screen and e-mail resumes all day long without many results. It's actually interacting with others that leads to the referrals that lead to employment.

Of course I wondered why the one woman was listed as unemployed when she took a series of minimum wage jobs--umm, hello? She WAS employed during that time--just not at the position she wanted. Her minimum-wage retail work brought in money, and kept her active until an attractive management position opened up to her.

Personally, I think volunteering during periods of unemployment is a terrific idea. I also agree that taking any job for the short term is a good idea.

On the other hand, the article suggests that a positive, sunny and 'can-do' attitude is important as well. Grace would probably bomb out in that catagory. Not that I am easily depressed, but neither am I perky. Cynical? Uh-huh! Sunny? Not exactly!

If there's one thing (Nah! There are a LOT of things!) I hate about this recession, it's what it's doing to the employment prospects of those near retirement but who desperately need to keep working for a few more years.

If It's Not One Thing, . . .

I've been holding my breath, waiting for the financial damage of the new roof for my rental to appear. I know my September numbers are not going to be good.

But, now it won't only be the roof. The construction guy called to say that the roof is done, and came in exactly as estimated. So far so good. Unfortunately, while they were up on the roof, they noticed that the ceramic chimney for the natural gas furnace was in bad shape, and needs to be replaced.

Did I need to know this?

But now that I do know, can I ignore it?

Oh well, I might as well bite the bullet and get the chimney fixed as well.

I am SO not a happy camper right now.

The Price Point of Happiness

When I get irritated at my so-called lack of material success, I remind myself that I am making more than my parents ever made, even accounting for inflation. In fact, I am solidly middle-class, which is nice considering that my roots are solidly working class.

Now, a new study out of Princeton tells me that I am the point of maximum happiness related to the amount of money I make.

The crucial amount is $75,000 per year. Up to that point, according to the study, more money would make me happier. After that point, having a greater income doesn't significantly impact my general day-to-day happiness.

What the Princeton economists measured was daily satisfaction. For all the whining I do, and for all the debt I have accrued, I find myself in agreement with their findings--I am generally financially happy on a day-to-day basis.

My income easily covers my mortgage, utilities, food and vehicle. If it doesn't so easily cover my credit cards, dining out, gifts to my kids, etc., well, those aren't expenses that are crucial to my well-being.

Do I want more money? You bet. Do I want more stuff? Uh-huh! Do I want the financial freedom that comes with being debt-free? Sure, I do.

But in terms of happiness, I already have it. At least according to the folks at Princeton.

Hmmm--I wonder how much they make per year?

There's a Reason We Celebrate Labor Day

My father's birthday was September 5th. Growing up, I assumed that the Labor Day picnic we attended annually (with all the free hotdogs and ice-cream one could eat!) was meant for him. Actually, it was, since he was a proud member of the International Longshore Workers' Union all of his adult life.

Daddy's been dead for more than 20 years but I think he'd be proud that his daughter grew up to president of her union, a white collar one at that.

This year has been tough for unions, who seem to be viewed either as an impediment to economic progress in a recession, or, at best, an anachronism--maybe necessary in the dim past but certainly not now.

How quickly we forget. And how easily we are co-opted.

My non-profit employer negotiated a three year contract last year, in the thick of the recession. Oddly enough, my employer has prospered during these hard times because we serve a very needy population that much of the stimulus package was geared toward.

Also, surprisingly to both sides of the bargaining teams, healthcare expenses rose barely 4 percent. My organization has always offered excellent health benefits and good vacation benefits as an offset to less than market wages.

So you'd think that healthcare wouldn't be on the table, wouldn't you?

Not so. Because other employers who were experiencing skyrocketing benefit costs were negotiating packages that included employee contributions to healthcare, my employer jumped on that bandwagon.

It took nearly three months of tedious negotiations to get modest wage increases (less than 1% for me though closer to 3% for those at the bottom of the scale) and fend off increased contributions for healthcare.

That's the union at work, folks!

My non-profit prides itself on good labor-management relations, but when push came to shove, they just couldn't help trying to take advantage of their employees, even when the need didn't exist and the money was there.

There have been times in the past when my union accepted frozen wages and even cutbacks in order to keep everyone employed. Now that times are better for this particular employer, the employer is loathe to share.

Enter the union and collective bargaining. The final result was not quite what either side wanted. But it was fair.

I love capitalism. I think strong unions are an important part of capitalism, notwithstanding the rightwing cries of "Socialism." I think the more accurate cry should be "Fair Treatment."

Baby, It's Expensive Out There

One of the bigger stories this past week was the unsurprising news that women are putting off baby-making, perhaps due to the recession. As CBS news reports, the US birth rate has hit an all-time low, in fact the lowest in a century.

While it is acknowledged that other factors like a drop in immigration and a postponing of pregnancy rather than a decision not to have children at all have impacted the current statistics, it is also true that this drop mirrors a similar downturn that happened during the great depression.

I know it's a cliche to say that if everyone waited until they could afford a child to have one, there would be no children. But children are expensive in so many ways--not just the actual expense of rearing them, but the consequential expenses of taking time off, maybe even years out of the job market, and the myriad of baby-related items and opportunities that are hard for new parents to resist.

My granddaughter apparently didn't get the memo, since she made me a great-grandmother two weeks ago. But oddly enough, the recession did factor into her decision--she's in the midst of college, and felt that taking a quarter off to have a baby wasn't a problem since the job market is so bad that any delay in entering into it seems like a good idea.

I have to say that, as a child of the sixties, who was influenced by Paul Erlich's "The Population Bomb," it doesn't bother me to see the birth rate decline. Maybe it should, since, as a senior citizen, I need those upcoming generations to support me in my dotage.

But I suspect the planet will do just fine with fewer folks on it.

Looking for Morrison?

For those who don't read the comments to my blog, but who have been missing Morrison from All Doors Considered, she's now at a slightly new webaddress. This link works as does the one in my blogroll. Talk about life slapping one upside the head! But Morrison is working through it.

Up But Not as Up as I Thought

'Tis the time for my end of the month review.

As expected, even though I threw every extra dollar at my debt, that $2700 I put toward the new roof for my rental home caused my indebtedness to rise by $431.88. It will get worse, because there's another $2000 to pay when the house is finally re-roofed.

But I was proud of myself for keeping the damage down to a manageable amount. It's not like the roof could wait. (Well, I guess it could have, but then I would have had cold, wet tenants on my hand--NOT a good plan!)

Life Keeps Getting in the Way of Plans

I want to welcome Louise from My Journey to Eliminate Debt back to my blogroll. As she sets out in her most recent post, a lot has happened since she ended her blog eleven months ago and none of it has been helpful in her quest to eliminate debt.

Quite the opposite--illness, job loss, and kids in college have all conspired to increase her debt.

Welcome to real life.

It's very easy to plan for debt reduction when all it takes is reining in one's impulse to buy the new car, big screen TV, eat out every night, etc.

But it's a whole 'nother deal when life intervenes in ways one can't predict.

Take Louise--who on earth worries about whooping cough these days? Who even knows anyone who ever got it? Well, take Louise!

I can blame lack of excerise and unhealthy eating habits as well as lousy genetics for my heart surgery a year and a half ago. But who does one blame for whooping cough?

Actually, my heart surgery barely impacted my finances. But ask me about the rental that needs a new roof.

And what about the fact that two of my daughters, ages 28 and 20, have FINALLY decided that they should rethink their decisions to forego college? And that my granddaughter, notwithstanding the birth of her first child two weeks ago, is enrolling back in her college?

Jimmy Carter had it right when he said "Life isn't fair," but I still think it ought to be.

There ought to be some justice for folks like myself and Louise who really have been trying hard and living frugally to get our debt under control.

Overdrafts! Again!

GAK!

I haven't had an overdraft on my checking account in years.

And I'm still not sure how I got one this week-end. I have a check register. I use the check register. I list all of my automatic payments. I keep a running tally.

So how did this happen?

Umm--can you say basic math?

I made a $200 subtraction error when I deducted my mortgage and PITI payment.

Why is it that such errors are never in MY favor?

I blithely used my debit card, and in the process, overdrew my account by $34.00.

Fortunately, I won't incur one of those $35 fees. BUT, a cash advance from my credit card was made automatically, which incurs a fee, not to mention interest from the date the charge is made.

This week is not starting out well.

Miscellany

This is for all the stuff too small for its own post.

1. "All Financial Matters" didn't deliberately disappear, but was hacked. JLP is back and my links now work to the blog. Thanks to my readers for helping me get this straightened out.

2. Guilt-trips rock! Julie (formerly Immer) at "Mein Taglich Brot" is back both in blogland and on my blogroll. Dawn? Bluebird? KemKem? Tell me the guilt isn't getting to you!

3. The roof is caving in. Both literally and financially. The bill for re-roofing my rental is $4800. I took the second-lowest bid because it's the same outfit that redid the windows three years ago, and I liked their work. But to come up with it, I now have a THIRD mortgage on my residence. Just the term 'third mortgage' gives me goosebumps. But my credit union wouldn't or couldn't extend the terms of my second mortgage. Instead, they will give me a third mortgage at .5% higher than my second (which means 7.25%, fixed) with a credit line of $10,000 for 15 years. My plan is to finish out the line of my second mortgage (about $2600) and put the rest of the roof onto the third mortgage. What makes this a tad less scary is that I only owe $38,000 on my home so there is plenty of equity. It does strike me as odd to carry mortgages on my residence when the funds have largely been used to fix up my rental home. But because the credit union is local and the rental is not, the credit union is only interested in my current residence.

Defining Retirement

J.D. at Get Rich Slowly has a very interesting post regarding how one defines retirement. It came up when someone suggested to him that, having given up being a box salesman to become a blogger and writer, he has, in effect, already retired.

As often is the case, the comments are every bit as interesting as the initial post.

I was struck by the condescending tone permeating the comments, that if one chooses to do nothing productive during retirement beyond watching TV, then retirement is somehow "unsuccessful."

The whole point of retirement, it seems to me, is the freedom to do whatever one wants (within the confines of one's finances and common civility). That includes the freedom to become intimately familiar with "The Price is Right" and "Dr. Phil."

But what really fascinated me were all the younger folks commenting on when and how they wanted to retire.

I don't know that I thought much about retirement until I hit my fifties. Part of this is because I had children at home well into my fifties. I had all I could do to simply survive their adolescences.

It's only been in the last five years that I've seriously considered at what age I wanted to retire, and only during the last three that I've made a concerted effort to get my retirement finances in order.

I don't think a change of career is the same as retirement. But neither do I think that retirement means I'll completely stop working in my field. I do plan to volunteer, and perhaps even work for pay on a very part-time schedule.

One commenter on J.D.'s blog says retirement is when one stops saving and starts spending. That makes sense to me, though saving is becoming so ingrained for me that it is hard to imagine not doing it.

At any rate, it makes for a good discussion.

Come Back, Come Back, Wherever You Are

This is not a new rant.

It is a continuation of a very old rant.

Why, oh why, do bloggers think they can simply disappear off the face of the earth, with no notice to Grace (or anyone else that I know of)?

The latest is "All Financial Matters," which I started reading even before I started blogging. The author was (is) much too conservative for my tastes, but the information he provided was always timely and provocative. Not to mention that he gave my blog a boost in one of his posts which sent a whole lot of readers my way early on.

So one day he's there, and now he's not? What gives? Death? Coma? Boredom? Fear of exposure?

Obviously, I consider the first two to be the only viable excuses.

At least when "Mrs. Micah" decided to depart the blogging world, she left a final post. (If you click on her link now, you'll find yourself at "Finance For a Freelance Life.") Which brings up another question. What's up with 'selling' one's site? It makes sense to me if one just has a general informational site. But if it's personal, if we're learning about the blogger's husband, kids, grad school life, etc., then how is that transferable to someone else who buys the blog?

I do get that it's about money, and readers. Buying a blog comes with a built-in readership. But if most of those readers were tuned in to the personal stories, do they stick around?

I dunno. I no longer read "Mrs. Micah" regularly. On the other hand, I stayed with Trish's transition to Beks over at "Blogging Away Debt," so maybe I'm being too critical.

What I really hate about disappearing blogs is being left in the middle of the story. Did Immer at Mein Taglich Brot find another job? Is Dawn going to save her house at "Fighting Foreclosure. Getting Nine Hundred?"

I don't know about inquiring minds, but Grace definitely wants to know!

I've been posting for exactly three years. About every six months, I go on one of these rants.

Expect more!

July 2010 Update

July was a good month for me. In spite of some extra expenses for my annual Zoo pass renewal and the impending birth of my first great-grandchild (wherein great-grandma was seduced by the multitude of cute outfits for baby girls, not to mention the combination baby carrier/stroller/bassinette that apparently every newborn must have--whatever happened to putting the kid in a dresser drawer?), I ended the month $21 under budget.

Better yet, I lowered my debt by $1072.17.

Of course, the roofing bill for my rental house hasn't come in yet.

But so far, so good.

It's a Matter of Perspective.

Morrison at All Doors Considered has a particularly poignant post today wherein her financials are discouraging, and she doesn't see it getting a lot better, either for her family or for the country.

She especially does not want to be told that there is upside to managing in the current economy.

But while I understand her position, I also disagree with her. Sometimes there IS an upside to deprivation.

For example:

One family Thanksgiving decades ago when my family got together, my sister and I reminisced about the good times we'd had as children. We both agreed as to the best summer of our lives--we were preteens and our parents took us to a local lake nearly every day. We stayed all day, picnicked for lunch and dinner, hung out with other families, learned to water ski (or fall off the skis in my case!) from a neighbor who had a boat, found out all the words to "Louie, Louie" and why they were considered dirty, and, after a month or so, saw our mother venture into the water for the first time. It was the one and only summer I actually got a tan.

Our parents were stunned.

They, too, remembered that summer but their memories were a lot less rosy.

My father was a longshoreman and that summer, he was on strike for three months. There was no Unemployment Compensation and they had little savings. They had to ask my mother's parents for mortgage money. They literally fed us oatmeal, deviled meat (from Abundant Foods, the predecessor to Food Stamps) and hot dogs all summer because it was what they could afford. Their car was paid for, and the lake was nearby, so their one small extravagance was the gas to get there.

My sister and I didn't recall that we had eaten the same cheap foods for lunch and dinner. We just remember going on the picnics and how much fun it was at the lake with our friends and our parents.

My point is that my parents were financially stressed to the max but still they managed to put their free time, if not money, to good use. Growing up in the fifties and sixties, it always appeared to me that my sister and I had a closer relationship to our father than most of our friends had with theirs. I trace it to that magical summer when he was available to us and willing to talk with us on any subject.

Did my parents ever want to repeat that summer? Not in a million years.

Would my sister and I go there again under the same circumstances? In a split second!

Dancing the Credit Card Shuffle. Again!

If you were reading me a year ago, you know that I jumped at a credit card offer to transfer one of my $8200 credit card balances to a 0%-for-nine-months new card. The cost of the balance transfer was $50.

Well, I've done it again!

I got an offer from HBSC (where I have my emergency account stashed) for a 0%-for-12-months-balance-transfer.

There are some downsides to this: (1) the transfer fee is $246 (3% of the amount transferred); and (2) the new card has a credit limit of $10,500 so my "credit used to credit available" ratio may impact my credit rating.

BUT the reason I went forward is that my net savings over 12 months will be $813. The card from which I'm tranferring the balance charges 15.99% interest, by far the highest interest credit card I have.

These kind of financial transactions always strike me as tricky and generally make me nervous. But the card, when it arrives, is going in the freezer with the rest of my credit cards.

Retirement Blues

Sydney Lagier has written a thought-provoking article over at US News & World Report on 10 Retirement Let-downs. (You may know the author better as "Retired Syd" who blogs at Retirement: A Fulltime Job.)

I freely admit that several of the items on her list are my main non-financial worries about my own retirement--never mind that retirement for me is 8 years off.

I recognize my personal capacity to become a hermit. And I also realize that I have a restless nature that is not likely to be happy about that. I do believe that maintaining relationships is important but I also know that death and job loss contribute to the loss of relationships as we become older. Where are the articles on how to make new friends when one is past age 60?

Not all of the concerns Syd listed are ones I share. Take it from me, Grace will NOT be moving to the country when she retires. I love my urban environment, access to good public transportation and the plain excitement of city living. Right now I live ten minutes from the downtown core--but one of the things I'm going to seriously consider when I retire, is moving to the center of my city.

Nor do I have a Mr. Grace to consider. Sounds like Syd thinks that's all to the good.

At any rate, as her article shows, there are a lot more than just financial considerations to be given to thoughts of one's retirement.

Cheapskate on Vacation

I've been on vacation the past week, and if I do say so myself (which I DO!), I very successfully cheapskated my way through it.

It started with airfare. The roundtrip flight was $179 but I used a $100 credit from Travelocity to get the cost down to a reasonable $79.

Then I met up with friends who had a timeshare at Lake Tahoe. I know what a bad investment timeshares are, but I'm not at all adverse to using those owned by my less financially savvy friends. (To be fair, this particular friend's family has owned the timeshare for over 15 years and use it a lot, so maybe it wasn't a bad investment for them.) The timeshare was at a resort that provided unlimited use of various spas, hot tubs, pools, and tennis courts. It also provided two free movies per day and "get acquainted" Margarita nights.

Since there were six of us, and we had a kitchen, my share of the food bill (which included copius amounts of Ben & Jerry's, and Mike's Hard Lemonade) came to $37.00. Plus the guys got into a grilling competition so we primarily ate dinners in. (Feed me good food, and I'll willingly do the dishes!)

For the most part, I hung around the hot tubs and pools, read books I'd brought from the library, and once, for $20 and 45 minutes, went to a casino. I apparently don't have what it takes to become a gambler--I thought the slot machines were silly (i.e. took no skill beyond pushing a button and watching the pictures roll), and Blackjack, boring.

But having a week away from home and office was, indeed, priceless.

Okay, not exactly priceless, but spending less than $300 for 8 days constitutes a true cheapskate vacation in my book!

Vindication--Thanks to Someone Else

Over the years, I have purchased several computers from Best Buy. While I don't appreciate their hardsell when it comes to warranties I don't need or set-ups I can do by myself, I have found their sales to be the best, at least for lower-end laptops and desktops.

A few years ago, I got really ticked off when the credit card I used to purchase a desktop, was charged $21.95 for MSN Online. Apparently I was given a free trial period with MSN when I purchased the computer. I never used it because I had AOL. But when I didn't cancel it after the free trial period, my credit card was charged the monthly user fees. I called Best Buy and I called MSN. While the membership was cancelled, I never got anyone to remove that one-month charge.

I was not happy, but, for me, it ended there. I paid the money and life went on.

Someone Else who got similarly scammed was less sanguine. Someone Else got a lawyer. Someone Else sued. As a benefit for Grace, they sued for class action certification.

And guess what?

Best Buy settled.

Shafting Grace cost me $21.95.

But shafting Someone Else cost Best Buy over a million dollars.

I will get my $21.95 back. Someone Else will get his or her money back plus an additional $2500. The real winners, of course, are the attorneys who will get a quarter of a million dollars.

I am glad that someone pursued Best Buy over this issue. I am a bit ashamed that it never occurred to me to check with an attorney. I just accepted that I should have read the small print more carefully when I bought my computer.

Let's hear it for Someone Else. From the bottom of my pocketbook, thank you!

Quarterly Networth & June 2010 Update

The financial news from Grace's house is so-so, both for the month of June, and for the quarter ending June 30th.

I reduced my total indebtedness by $819.55 (YAY!!) but a new roof for my rental home awaits (BOO! HISS!). That expense should hit sometime in July or August.

For the quarter, my net worth is down $4,464.75, but I'm still over the half-million mark at $557,635. The loss is a result of lower amounts as of this A.M. in my 401(k) and the static housing market in my Pacific Northwest city. I'm not so sure about the latter, however. I use values from Zillow which show my home to be worth $324,000. But that same website shows the house across the street to be worth $355,000 when, in fact, it sold this past week for $374,000. So my net worth may be higher than I think.

Financial Failure Can Happen to Anyone

AOL highlighted author Jacqueline Mitchard's financial plight in today's news. But I had read about it last December when the highly regarded author wrote of it in Parade magazine.

There are so many parts of Mitchard's life that I admire, even envy--the wonderful books she has written, the fact that she and her husband have adopted children, the movies that have been made from her novels. She's only a few years younger than myself, and I would trade places in a heartbeat.

But being warm, personable, bright and educated does NOT protect one from financial scams. Some time ago, I wrote about a doctor friend who got caught up in Bernie Madoff's money games.

Mitchard points up two aspects of being a victim--one is the shame of it. Where, she wonders, are the books and newspaper articles highlighting the victims? Instead they remain in the shadows cast by the spotlight shone on the scammers. Others write about them in passing but the victims seldom seem to tell their own stories. Who wants to admit they could be in that position.

Mitchard talks about the well-meaning friends who say they feel sorry for her, but also feel like it could never happen to them. Really? What makes them so smart and so special that a con artist could never get past them?

The only reason I feel safe is that I've never had enough to invest that would interest a Madoff or his clones. I certainly don't think it is innate intelligence. That might protect me from the widows of Nigerian Generals and Lottery officials from Ireland (really? I didn't even have to buy a lottery ticket?) but the best scammers are a lot closer to home.

Saddest of all is the label of GREED that is attached to many victims which allows those of us who were not taken to somehow feel superior. Yet, as Mitchard's situation makes clear, greed had nothing to do with it. A steady rate of return and a decent retirement was all she and her family were looking for.

They are still looking.

Bad Financial Planning and Good Financial Advice

Fran Tunno Mills has (probably) $176,000 coming to her from the sale of her California home, which makes her feel financially okay. Her financial advisor, provided by the LA Times as part of their money make-over series is less sanguine--she thinks Fran is in a financial pit and will have serious problems climbing out. As this article makes clear, the financial advisor is almost certainly correct.

Fran is 54 years old, newly divorced (the house was sold and the proceeds divided as a result of divorce), and does voice-over work on contract, which garners her approximately $40,000 a year. [Another thing I can't tell from the article is if she gets child support for her two children or if that is included in the $40,000.]

She has saved only $29,000 toward her retirement, and has $39,500 in debt.

To her credit, Fran knew she needed help figuring out where to go next. But Fran was wondering whether to buy a house or a condo. Her financial advisor was thinking Fran can't afford Domino's pizza, much less a home.

Clearly, living in Southern California is part of the problem. It appears that Fran is considering a move to a small town in Pennsylvania to be near her father, though the article doesn't say whether she can continue her recording contracts from that distance.

On one hand, Fran contributes $300 a month toward her children's college funds, but on the other hand, she uses credit cards to maintain her standard of living. Neither of those can continue.

I have a lot of empathy for Fran's position. I was roughly her age before I saw the necessity of putting money away for retirement. And, like her, I still had teenagers at home during my fifties. I know that if anyone had dropped $176,000 into my lap, I would have felt like I was home free. And I probably would have looked around for new housing.

I think she was fortunate to have a savvy financial advisor to set her straight. The housing proceeds will come in very handy, but just to get her back to zero. She still has to make a lot of plans for her financial future that will entail a number of cutbacks in her family's current lifestyle.

New Blogroll Stuff

Anonymous asked me to add The Boxcar Kids to my blogroll, which seemed fair since I not only read that blog, I often reference it in my own blog.

While I was doing that, I decided to check out the rest of the links. Big mistake! I wound up fixing a bunch of previous link errors, adding some new-to-me blogs, and removing those bloggers who haven't posted in the last six months. (But I'd be happy to put those bloggers back if they'd start up again. Bluebird, KemKem, and Immer--that would be YOU! And "Fighting Foreclosure--Getting Nine Hundred," you're getting perilously close to my six month mark!)

Check out "$647,000 in Debt and Unemployed," which is the no-longer-accurately-titled blog of a young Iraq vet who got caught up disastrously in the world of real estate speculation and is slowly working his way out. Dealing with life, school and bi-polar disorder isn't making it any easier, but this raw blog is actually quite inspiring.

Also, stop by the Donna Freedman (who famously wrote an article about living on $12,000 a year) blog at "Surviving and Thriving." She relays tips on frugality and gives away Godiva Chocolate--what better combination?

I've also added a couple of blogs I've been reading for awhile now--I don't know why they weren't on my blogroll already: "M is for Money" and "Always the Planner."

Finally, I added "Tough Money Love" and "The Po File" to my list since both of these gentlemen often comment here. Both have posts that are generally contrary to mine, but are still provocative and thoughtful.

Unemployment for the Unenlightened

Wow! Some days I read a post that really says it all.

That's how I felt when I checked out this post on Unemployment at The Boxcar Kids blog.

I work with those living below the federal poverty line--some of whom are, just as the critics fear, not all that interested in working.

But they are the exception.

These days, in this economy, I am getting more and more clients who never expected to be in my office. The simple act of getting food stamps and Medicaid embarrasses them. Unemployment, less so, because at least there's a sense that those benefits were earned and that getting Unemployment Compensation proves that there was a time when they were gainfully employed.

I share the blog author's dismay at those who carp about extensions of unemployment compensation, as though it's an unwarranted suck at the public trough.

Are the critics really so set financially that they cannot conceive of being laid off? Of experiencing age discrimination? Of not getting back into the work arena easily?

Or is it a certain smugness brought on by class?

I dunno. But as someone who is just one job away from financial disaster, you won't find Grace complaining about extensions to Unemployment Compensation.

Just don't ask me about all the forms of corporate welfare!

Blogging the Bad Along With the Good

So Shevy, at Shevy's Miscellaneous Life has been hiding out rather than blog about the downturn in her financial progress. I want to tell her to let it all out rather than stop posting.

Responding as a reader, I very much want to hear about the downs as well as the ups in one's finances.

So in my blog, I don't have a problem talking about the car that stopped precipitously and had to be replaced, the clothes dryer that bit the dust and the various times Murphy seems camped out in my living room.

But I'm a bit more circumspect as to other financial issues--you know, the ones where it is MY mismanagement, MY inability to delay gratification, MY poor financial decisions that are causing setbacks.

Who wants to trumpet their failures in public?

Yet how else are we to measure our progress against that of others? How else are we to know that we're not alone slogging through the financial mud?

One of the more interesting blogs that I read is Our Debt Blog.

It should come with a warning label that reads "Do NOT Try This at Home!"

Name a mistake, and the writer of this blog has made it and is continuing to make it.

BUT, he's at least aware of the issues, and, sporadically, making an effort to control his debt. Most importantly, he blogs it all--the foolish mistakes, the debts paid off, the new debt taken on.

There are times I want to reach through the blogosphere and strangle the guy on the spot. Well, that or shake him till his teeth rattle!

But in some odd way, it does make me feel better to read his real-life examples.

Wouldn't it be nice if debt reduction happened in a straight line? If we all made financially responsible moves all the time?

Welcoming a Childless Summer

I almost have my house to myself for the summer. My two live-in grandkids are back with their mother (my daughter) where they will stay for at least the summer. We'll see how she does before making decisions about next year so the children's absence may or may not be temporary.

In the meantime, there should be a major impact on my finances.

Since both of the kids are bedwetters, my washer and dryer were in constant use. In the week since they've been gone, I've done exactly one load of laundry.

When I turn lights off and close doors, the lights stay off and the doors stay closed. More utility savings.

No more running the kids to activities all over town. I've got a bus pass which I use for commuting, but it was such a hassle to take two youngsters on the bus that I would wind up using the car when running errands.

This is not to say that I don't miss having the little kids around.

But my wallet is happier now that they're gone.

Re-Training, But for What? And at What Expense?

For someone who believes her current job to be secure (knocking wood furiously), I am obsessed with articles about folks over 50 who have watched their positions and their income fade away.

One suggestion is to retrain. Apparently enrollment is up at community colleges as people do just that.

But retrain to do what?

How does one even know what jobs are available out in the real world.

Two of my daughters have their CNA certification. This allows them work in nursing homes and as care providers for private patients. Theoretically, their field is wide open given an aging population. But the reality is a bit different. Both of my daughters are paid by the state to provide home care to handicapped individuals (usually but not always elderly) who get so-many hours per week of assistance.

Unfortunately, our state, like many others, is in fiscal crisis. So the number of hours available are being cut back.

Nursing homes are similarly cutting back as government subsidies are decreased.

So getting the CNA certification, which should have been a good plan (and actually has been for my children) is not so great at the moment.

Jayme, who writes the Boxcar Kids blog, is looking at retraining in her environmental field but the cost is $1600. If it would lead to a guaranteed job, it would no doubt be worth it. But there are no guarantees in this economy.

Ask 57 year old Rick Moran who has twice sought out more education (as a corrections officer and an auto-parts designer) and more certification, but has yet to find a job since being laid off from a design job with Chrysler 2.5 years ago.

I have absolutely no clue what I would do if I could not work in my current field. Nor do I know how I'd figure out if retraining was worth it--assuming, of course, if I even knew what other fields I should be looking at.

Easy Answers

Poor Anonymous is going to keep cloaked once he/she/it reads this post.

In response to my last post, where I mentioned that my rental house needs a new roof this summer, anonymous perkily commented, " If you can save $1,000 a month, you will have the money in a few months."

Say what? Are we on the same planet?

If I could save $1000 a month, I would be out of debt in the next couple of years.

But it took everything I had to put $1300 against my debt during May--including my car payment and my minimum payments. Whether I can manage that feat again in the next few months remains to be seen.

Let's face it. The roof will have to be financed. I have $318 in what is supposed to be my $1000 baby emergency fund. I'll have, maybe, $500, by the time I have to pay for the roof.

Like the van last December, getting a roof is both necessary and expensive. I will get a deal of sorts because my tenant's father does roofing and my tenant has made no secret that he'd like to buy the house one day. I'll get a deal and Dad will do a good job for his kid. But he won't do it for free, or even for $500.

OK--end of rant.

But please--it doesn't help to tell me that if I'd just save $1000 a month, I'd be OK!!

May 2010 Update

At least on a temporary basis (I fear for later this summer!) the news is good. For the month of May, I reduced my total debt by $1351.68.

This is the best I've done since the first of the year (right after I incurred $6000 worth of debt in December, 2009 for a new-to-me minivan) so I'm feeling good for the moment.

Overall, I've reduced my debt from the first of the year by $4000. I'm worried that a new roof for my rental house will reverse this momentum, but for now, everything is moving in the right, downward direction.

BONDage

Apropos to the comments left on my last post, I have been paying more attention to my 401(k).

For most of my financial life, I've put whatever monies I had available into stock mutual funds, often index funds.

I proudly avoided bond funds and money market funds right up until the end of 2009, by which time it just got too frightening to see the volatility within my retirement resources.

So, I started putting new money into bonds.

Right now, I have about 7% of my money in bonds, but the percentage is on the rise.

Apparently I am not alone in my rush toward bond funds. According to the latest issue of Money magazine (the article is not yet online on their website), there is a current feeding frenzy as investors turn to the safety of bonds.

But Money magazine is sounding the alarm that the 30 year bull market in bonds may well be coming to an end, just at the point that people like me are buying them.

So where does that leave Grace?

Since I'm within 10 years of retirement, and have only 7% of my holdings in bonds, clearly I need to continue buying them. But I'm paying high prices for funds that are likely to go lower in the near future.

One solution is apparently to stick with short-term to intermediate-term bond funds or to look at riskier funds that invest in floating-rate bank loans or municipal bonds.

My real problem is that I don't understand the markets well enough to know exactly what I'm doing. I seem to be 'following the crowd' which is almost always the wrong thing to do when it comes to investing.

I'm going to keep reading and trying to find my way through this morass.

In the meantime, no matter what a couple of my readers say, I am NOT going to be seduced by gold--so far nothing I've read persuades me that those investments are good for the long term.

Playing Ping Pong with My 401(k)

I religiously put $1025 of my pre-tax income into my 401(k) each month. My employer contributes an additional 6%.

As of April 23, 2010, I had $190,000 squirreled away for my sunset years.

Today, I have $169,000.

Welcome to the roller coaster.

Ideally, I should close my eyes, continue the contributions, and see where I stand in 8 years when I plan to retire.

Realistically, I keep peeking! And worrying!

This is, no doubt, a function of my age. If I were in my twenties, thirties, heck--even my forties, I could be more sanguine about the upheavals in the stock market. But this is my immediate future we're playing with. And it's scary!

When the Job Goes Before You Do

There have been times when I've worried about hanging onto my job. But having been with my current employer for the past 20 years, I feel like I'll last, God and my health willing, for another 9. Even if I didn't, I am in a field where I could set up a private practice to bring in income, though not with the health benefits I currently enjoy.

So in spite of the occasional whine, Grace is doing OK, jobwise.

Which is good, because the economic outlook isn't so hot in other fields for those of us who are 60+ years old.

Take Carol, the subject of Liz Pulliam Weston's latest post at MSN Money.

In Weston's view, Carol might as well admit that she's retired because chances are she probably is.

The rest of this very good article talks about making the money last in a retirement that will be longer than expected, with less resources than expected. Carol has an employed husband, good unemployment and health benefits, and a positive attitude.

But it would be nice if ageism didn't figure into her life so prominently. I like to think that someone with my experience or Carol's experience would make them an asset to the next employer.

Sigh. Let's get real. It might but it's a rare employer who is willing to find out--not when they can hire someone younger and less expensive with enough experience.

Sad but true. Another of life's lessons in fairness.

They Went Which'a Way?

Two of my favorite bloggers seem to have dropped out of sight.

Hedonic Adjustment's Bluebird has been known to take periodic sabbaticals, but now even his old entrys are gone. Same with Dog Ate My Finances.

What I really dislike is the snarky note that Blogger puts up, saying "It doesn't look like you have been invited to read this blog." Like it's some disco and I'm standing outside the red carpet.

Then Blogger suggests "If you think this is a mistake, you might want to contact the blog author and request an invitation."

Gee, folks, exactly how do I do that when the e-mail address is on the blog--you know, the one you won't give me access to!

Anyone have an update on either of these blogs? I hate to eliminate them from my blogroll.

Creating a New Path

The Seattle Times profiles Sloan, a 65 year old accountant who has been out of work since mid-2009. She's rather enjoying the lessening of the stress caused by 12 hour workdays with her previous employer but her unemployment will be ending soon and she's worried about her future.

This story hit home because Sloan is just a few years older than myself, has saved about $60,000 less than me, and is also diabetic. She has considerable equity in her home, but she still owes $130,000 on it. I'm guessing she took a 30 year mortgage when she bought her home 16 years ago, so she will be 80 years old before it's paid off. Still, she has no other debt, which puts her ahead of me on the credit card front.

Assuming the author of the article is correct, I was interested to learn that Sloan could get Social Security under her ex-husband's account, and let her own Social Security ride until she turns 70, at which time she would get maximum payments on her own account. If this is true, it makes me regret never marrying (though apparently I would have had to have married and stayed married for ten years for this to work).

The article also highlights an issue for older workers who have the work experience but not the educational credentials--Sloan is called an accountant but she never graduated from college. I'm wondering if this makes her more like a glorified bookkeeper? This was fine so long as she was with one employer, as she was for some 20 years. Yet it makes moving to a different job more difficult for her.

I thought it was smart of her to take courses that would allow her to prepare taxes professionally because that would allow her to earn money on a part-time (or part-year) basis.

I was glad to see that though her financial planner had concerns, he also had plans for Sloan that would lead to a successful, though frugal, retirement.

When Frugality Trumps Neighborliness

I read a lot of other blogs, both financial and not. There are often posts that get me to thinking, such as this one from Betty at Bouncing Back From Bankruptcy on the demise of her higher-priced-but-still-convenient local market.

I always feel badly when local, independent stores go out of business.

And guilty, too.

I'm one of those shoppers who says they support the independents, then goes to the mass marketers in the name of frugality and in search of bargains.

I, too, have a small neighborhood market that I go to only occasionally. If I'm running out of milk, it's easier to walk two blocks to what my kids call "The Chinese Store," (never mind that the owners are actually Korean) even if I do spend $1.50 more for the milk. And if the summer heat demands popsicles, it's much easier to drop into that little store than to get in the car and go off in search of cheaper treats.

But I never do any major shopping there.

So who do I blame if the store is in financial trouble? And to whom will I complain if it goes out of business?

I see this all the time in the bookstore world. I love to go into small, independent bookstores. But when I buy, it's most often from Amazon.com. That helps my pocketbook, but not the local booksellers.

I don't have any answers to these questions.

Just a lot of guilt brought on by frugality.

Is Retirement Inherently Selfish?

Thanks to Syd at Retirement: A Fulltime Job for directing me to Financial Sumurai's post on The Dark Side of Early Retirement.

At age 61, it's too late for Grace to retire early. But some very interesting questions are raised. Is it selfish to retire early? Are those who tout early retirement really covering up for career failures? If it requires super-frugality to retire early and remain there, does volunteerism go by the wayside?

And perhaps most interesting of all--are those who have retire early really as happy as they sound and is their life in retirement as easy as they make it seem?

Reading through the many comments left in response to Financial Sumurai's initial post, it is easy to see that others besides myself question whether the whole concept of retirement is really for us.

Syd addresses this over and over in her blog. Ultimately, she thinks it comes down to temperment.

I have to agree. And we need to be honest with ourselves as to what it will take to keep ourselves satisfied.

Some of us depend upon external stimuli to keep us in the game.

Left to my own devices, I'd happily stay ensconced at home with books and my television set, at least until the Ben & Jerry's ice cream ran out. But I know me. Heck, I got bored when I spent a month at home after my heart surgery.

That's why, even without the financial impetus my debt provides, I'd still work beyond the average retirement age. I see my retirement as requiring volunteer work of some sort just to get me out in the real world. I see the need for a schedule of sorts, even if it is a much lighter one that my work world requires.

When the Village Gets Too Close to Home

Extended families are back in the news--specifically, extended families sharing the same home. Liz Pulliam Weston addresses it in her MSN Money column, Should We Live Like the Waltons? Parade Magazine, in today's Sunday supplement also takes on multigenerational families. (Sorry, there doesn't seem to be a link to the specific Parade article on their website.)

Grace is part of this comeback. My household currently consists of myself, an adult daughter, an adult son-in-law (separated from another of my daughters), and two grandchildren.

What surprises me about the articles so far is that while they acknowledge that the economic crisis has forced our families into one home, they tend to focus on the social issues, not the continuing financial ones.

There is the sense that extended families are practicing economies of scale. Would that it were true, but I suspect that what I'm personally experiencing is not unlike that of many other newly-extended families.

I'm the only consistent wage-earner in my household. The newcomers are contributing, but not nearly enough to cover my increased expenses. Not only are my utility bills like electricity and water increasing, but so are minor expenses like toilet paper, laundry detergent, and deordorant.

Moving in with me is financially advantageous for my daughter. It works for my son-in-law and his children.

For me? Not so much.

Let's face it--when families move in together, it is NOT going to be an economic boon to both sides. Either it's middle aged adults assuming care of their parents or continuing the care of their children into adulthood. One half of the equation needs the financial help and the other half is providing it.

I do see the provision of housing for members of my extended family as currently necessary. I also see it as temporary.

Trust me on this one--Grace's family ain't the Waltons!

April Update

The debt is down by $690.74. Not a huge number, but I'm proud of it given the number of extra expenses I've had this month. These included the $145 I owed on my state income taxes, the $334 for one third of the property taxes and $587 for insurance on my rental property, and $139 for the new-to-me dryer.

I learned that I will probably have to re-roof my rental home this summer, but at least for the moment, my debts are going down.

Errata--Stuff Too Small for Its Own Post

Learn something new every day! As in, what "Errata" really means. Obviously, I'm using it to mean "all the extra stuff." But apparently, I'm incorrect. It really means a "page of corrections." Well, dang! I like my definition better.

At any rate, in the Gospel According to Grace, here's MY errata:

1. I added a new blog to my blogroll. Mein Taglich Brots (Is that German? The Blog, however, is in English.) It's by a 60 year woman who has faced bankruptcy and foreclosure during the past year and is fighting her way back to fiscal soundness. I found this blog when I was checking where my readers come from--do those of you with blogs find your Sitemeter statistics to be as utterly fascinating as I do?

2. The 227th Festival of Frugality is up at Money Obedience. Grace and her English Muffins are there, along with many other even more interesting posts.

3. The guy who rents my garage is pretty sporadic about paying me. I don't lose any sleep over this because I'm not otherwise using the free-standing garage, and when he pays, he catches up the back and pays a couple of months ahead. So yesterday he caught up two back months and paid two months forward. YAY!!! At virtually the same moment, my clothes dryer, purchased in the early '90's went Kaput! BOO! HISS! Is there some kind of cosmic code that says when money comes Grace's way, so shall some unexpected expense? At any rate, since I know I'll have to replace the washer in a few years (the two appliances were purchased as a set), I decided to just get a used dryer for the moment and then get a completely new set when the washer follows its dryer-mate into laundry heaven.

That's it for now. I'm off to look for a more accurate word to replace my use of Errata!

The English Muffin Epiphany

Last week a neighbor who was going on an extended vacation emptied her refrigerator and asked if I could use the food that would spoil before she returned.

Free food? You bet I said yes.

One item was an unopened package of Thomas' English Muffins. Now I love English muffins. I eat at least two a day, with butter and strawberry jam. But it's been years since I've purchased the Thomas brand because they are several times as expensive as the sale-priced store brands I normally get. I'm the kind of person who stocks up when a store sells its own brand at three for a dollar, and freezes the extras.

The store brands are serviceable. I like them.

BUT, they are SO not as good as the Thomas' variety.

I was forcibly reminded of this as I worked my way through the package left to me by my neighbor. These muffins were fluffier, fresher, with all kinds of nooks and crannies to hold the butter and jam. They were so good, I actually had a dream about them one night.

Still, they didn't last forever and now they are gone.

What's a cheapskate to do?

Would it have been better not to have had the finer brand when I will have to go back to my usual mediocre brands? That doesn't sound right. Why would I deny myself the occasional treat just because I can't have it all the time?

Should I change my frugal habits and start purchasing the Thomas brand? Not likely since I eat too many of them per week.

In the meantime, I read far too many articles on frugality that tell me store brands (of almost anything) are just as good. Can we admit that this is often NOT TRUE? Sometimes I just don't care. For example store brand tomato sauce may not be as good as something more expensive, but once it is in my spaghetti sauce, I don't find that any difference is worth the additional expense.

But for my daily English Muffin fix? Hmm--tougher question.

The Ups, Downs and Surprises in Obama's Health Plan

First of all, politically, I have always supported President Obama in his quest for national health care. I think it is outrageous that a country as wealthy, both monetarily and intellectually, as ours, doesn't have universal health coverage for all of its citizens.

The Plan that recently passed is hardly perfect.

But it is a start, and for that, I'm grateful.

Still, it's going to be an interesting ride as we get used to the effects of this new legislation.

I mean that in both a good and a bad way.

For starters, my 19 year old daughter will now be covered under my employment policy until she's 26 instead of 21. I'm sorry I couldn't have offered that coverage to my four older daughters, only three of whom have any health insurance at all. Unfortunately, by this fall, when the coverage starts, all but one of my children will be over age 25.

That's the good news.

Then today, I discovered that not everything about the health bill is going to be healthy for my bank account.

One little-advertised effect is the impact on flexible spending accounts.

Beginning in January, 2011, over the counter drugs will no longer be covered. For me, this is a minor bummer since I currently get reimbursed for all my antacid, aspirin and cold/flu medications. Also, pre-tax deductions will be capped at $2500 a year. It only takes orthodontia for a couple of kids to reach that amount in the blink of an eye.

I am still in favor of universal health care. But I am also wondering what other surprises, helpful to me or not, are contained therein.

Pinch Me

I don't read Salon.Com on a regular basis, but clearly I should.

I just discovered that site's "Pinched" series. It's a fascinating group of articles examining the effects of the recession. I came across it because the author of another blog I follow, The Boxcar Kids, wrote one of the newest columns about her trials as a nearly homeless mother of four.

I particularly enjoyed the articles and all the comments about foodstamps, the one by a cleaning lady, and especially the one by a former real estate agent who wonders what part she played in the bringing on the recession. Then there's the guy who refuses to go into debt to pay for his Duke education--he's living in a van in one of the college parking lots!

No, I won't give you links to the above--read ALL of the articles. They are that good.

Retirement Bond-Aid?

It's my week for spotlighting Walter Updegrave at Money Magazine. In this week's column, he addresses an issue that has confused me for years.

Namely, whether bonds have a place in my retirment mix, and if so, how much?

Ever since I first started seriously saving for retirement, I've avoided bonds. This comports with what Dave Ramsey teaches, and fit my own perception that I didn't have enough time left to have my earnings held back by conservative bonds when I could be investing it all in equities.

Ramsey suggests mutual funds divided evenly among growth, growth and income, aggressive growth and international funds. Note that he does not recommend buying bonds at all.

But I started getting cold feet in late 2009 as the recession was decimating my equity portfolio. At that point, while I left my equities alone, I divided future payments so as to put 50% of them into bond mutual funds. Right now, about 7% of my 401(k) and 403(b) monies are in bonds, and that percentage is growing.

Updegrave says that is typical of those of us who "fly solo" as we invest. We tend to take much more risk than we should or that we would be advised to if we got professional help.

I guess what I really want to know is if the professionals are correct? The obvious downside to a portfolio containing only stock mutual funds is if we have to retire just as the market is at a low, we won't have as much money available to us. But over the longterm, won't we be better off?

In the end, I just could not handle the level of losses my accounts were sustaining, and I am now opting for slower growth but less stomach-churning drops.

I have no clue if that's the right position to take or not.