Tuesday, July 31, 2012

Two Summer Months Down, One to go

OK, Grace is on a roll, here!

In June, I put a net amount of $704.39 against my debt (net because the previous month I'd actually increased my indebtedness).

July has been even better. My debts are down another $1489.96.

I now owe a grand total of $84,930.50 which is a lot, but it's coming down.

August will be harder because I will be having four of my grandkids for the month, but I've got every free children's event in my city calendared.

I can't wait until my house is paid off (1.5 years) so I can throw my entire mortgage payment at the rest of the debt. That's when real progress will be made!

Sunday, July 29, 2012

Geezer Tech

I read an interesting article on U.S. News' "Planning To Retire" blog regarding how seniors use technology.

The most entertaining finding (and one that is certainly true for me) is that seniors are less likely to use the internet (53% of us compared to 82% of younger adults). But once we get with the program, 70% of us are on the internet on any given day.

Yep! Definitely moi! If my house caught on fire, I'd grab my computer first.

As seniors, we are also late to the cell phone party. I suspect (based not on any studies, but on my own use) that we are less likely to have fancy smart-phones. I still use a tracfone, which works just fine, and costs me a lot less than the cells my daughters insist on using. But I do feel safer having access to mobile technology and at this point, I wouldn't want to be without it. On the other hand, I haven't given up my landline.

I was surprised to see that seniors are less likely to use e-readers. Personally, I love my Kindle Fire. It hasn't replaced books in my home by any means, but it works great for commuting to and from work. Plus, there's the ever-addictive "Angry Birds!"

But I fit right in with my age group in that Facebook isn't really my thing. I check out my daughters' pages, and those of my grandchildren. Yet I rarely check my own page and the only updates tend to come from pictures my kids share.

I think the bottom line is not that most seniors are anti-technology, but we are less likely to need all the new toys the day they come out. That could explain why so many of us are still on our desktops instead of laptops or tablets.

Wednesday, July 25, 2012

When Your Retirement Plan Depends on Your Parents Dying

One of my colleagues (she's an attorney married to a chef) admitted to me that her retirement plan consists solely of expected inheritances from both her and her husband's family. I was a bit taken aback, but when I've told that story to other people, they have been less shocked. And some have admitted that their parents' money figures heavily into their own retirement plans.

Maybe I'm just jealous--both of my parents are deceased. They never thought of themselves as poor, especially in their comfortable retirement. Upon our mother's death, my sister and I split the $95,000 (including the family home) estate. I'm grateful for what I got, especially since it became the down payment on my current residence. It also saved me from having to sell my first home, which has been paid off for years and which I now use as a rental. But retire on $47,500? Even with 26 more years to grow it? I think not! I wouldn't have done it then even without foreknowledge of the recession to follow. I can't imagine doing it now.

I wonder if my colleagues have read the latest issue of Money Magazine, which reports that only 14% of baby boomers' parents--down from 22% in 2005--even believe they owe their children an inheritance. Most are intent on spending the money they have acquired, some for health care and many for "good times." It's their money, and it is not up to us to begrudge our parents' use of what belongs to them.

Money Magazine advises boomers to substantially lower their expectations. While around 50% of parents do plan to leave at least $100,000 to their adult children (not exactly enough for a well-funded retirement), life may intervene. Not just market returns, but extended long-term care could make a mockery of good intentions.

For myself, I do plan to leave money for my five children. It's certainly NOT going to be enough to fund a retirement plan, but I'd like to get their retirement monies off the ground. Then again, I won't be around to direct how they spend whatever I DO leave them.

Tuesday, July 17, 2012

Life As a Cheapskate

I picked up Jeff Yeager's "The Cheapskate Next Door" at a library book sale a couple of months ago. I finally got around to reading it this week. The author would have been proud of me even if I did him out of his royalties on the $12.99 original price. While I am far from the kind of person he describes fondly as a cheapskate, I do have my miserly tendencies. Not paying full price for a book is just one of them.

Yeager's book was published in 2010, and the material is clearly informed by our ongoing recession. The book is modeled on "The Millionaire Next Door" though without the rigorous research to back it up. What this means for the reader is that the book is less about savings tips and more about the lifestyle and personal biases of the "average" cheapskate. I found this fascinating, even if it proves to me yet again that I may be broke and trying to recover but I don't qualify as a genuine cheapskate.

Yeager's cheapskates have a lot in common with the true millionaires Thomas J.Danko and William D. Stanley studied (meaning, people who really have a million, not just stuff and debts). To some extent, being a cheapskate appears to be a trait that begins in childhood. It has more to do with one's inner sense of self, one's self-reliance, and one's immunity to desiring what their neighbor has. At base, it comes down to getting the job done rather than worrying about what one looks like doing the job.

Most of the cheapskates Yeager interviewed are not adverse to comfort nor do they forgo quality when they make a purchase. But neither do they see the point in upgrading if what they already have works fine. They don't all drive junkers, but they do drive their vehicles until the cars are no longer safe. The millionaires tended to do the same. Both the cheapskates and the millionaires live in homes that are smaller than what they can afford and both are usually still with their first spouses.

It appears to me that both Yeager's cheapskates and the millionaires in the Danko/Stanley book have a degree of ingenuity and self-confidence that many of us lack. I know I don't have these particular traits. While I like the idea of making do, of saving, of always searching for the best value, there are times (way too many times!) when I am tired, cranky, impatient or envious, all of which lead me spend money NOW rather than waiting.

Ultimately, that's the average cheapskate's point: delayed gratification and the ability to adopt that as a mantra leads to cheaper products, more money and a better all-round life.

Sunday, July 8, 2012

The Rich: Disinterested in the Rest of Us or Just Plain Mean

I haven't lived in New York City since 1977, but it's a measure of that city's impact on me that I still (and continuously) have subscribed to New York Magazine.

An article in their most recent issue caught my eye. It asks the all important question, "Are the Rich Meaner Than The Rest of Us?" It's a long and fascinating article, which seems to conclude that the rich are not necessarily meaner but they are not much interested in the plight of the rest of us. We recede into the background and take a distant second to the main concern of the rich--which is maintaining and increasing their wealth.

In my workplace, we once had a daylong workshop presented by Dr. Donna M. Beegle, author of "See Poverty. Be the Difference." Part of the book details her personal struggles as a poor white woman, teen mom, and eventual Ph.D candidate. She also speaks of the characteristics of those mired in poverty that are admirable but ultimately less than helpful as one moves out poverty. She is clear that many, many of her relatives and friends who had little themselves gave generously as she worked and studied her way into the middle class. But she also writes about how hard it is for her to now save money, when that is not a shared value. In fact, it is expected that she will "give back" by loaning or giving money to others in her family/community. The poor, she writes, don't always see the value of saving money over time. And her need to save now that she is in the middle class makes her seem unkind and ungrateful in her former community.

I am discouraged by the research outlined in the New York article. I'd like to think that if I had more money, I'd give more, and I'd be happier doing it.

Apparently, NOT.