Not to sound overly cranky, but why is it that some of my favorite bloggers have decided to drop off the face of the internet?
I forgive JW, whose "Need to Be Debt Free" was one of my favorite reads--apparently someone turned his employer onto the blog and put JW's employment in jeopardy. The blog or the job -- pretty easy choice, there!
But what is Bluebird's excuse? I have always found his blog, Hedonic Adjustment, to be an interesting read. I'm hopeful about him, because he's wandered away before, and then returned. As for him being tired of blogging--my personal opinion is that no blogger should disappear until or unless GRACE grows tired of reading them!
I have no idea what happened to Petunia at Keeping Score--one day she was there and the next, she wasn't.
Then, just as I was thinking about adding Change Can Be a Good Thing to my blogroll, the author decides to hang it up. I especially like the title of that blog in all of its connotations, except the idea that she can change her mind about blogging!
Whoever said "All good things must end" probably got it right. But I reserve the right to whine and blog about it.
Thursday, May 7, 2009
Wednesday, May 6, 2009
Freebie Time
OK, I admit it--I DO (sometimes; occasionally; not more than twice a week!) eat fast food. Which is why I like this coupon from Kentucky Fried Chicken for a free meal.
You can print out up to four of the coupons. As long as everyone in your party shows up in person, each person can use their own coupon.
It's good through May 19th, but it is not usable on Mother's Day.
Come on! Mother's Day? It would be just tacky to treat mom with a free coupon even if you did try to convince her that KFC was her favorite restaurant!
You can print out up to four of the coupons. As long as everyone in your party shows up in person, each person can use their own coupon.
It's good through May 19th, but it is not usable on Mother's Day.
Come on! Mother's Day? It would be just tacky to treat mom with a free coupon even if you did try to convince her that KFC was her favorite restaurant!
Friday, May 1, 2009
It's a New Month; It's a New Day!
So a couple of days ago, I was blithering about frugal fatigue and being stuck in the financial doldrums. Today, I'm feeling much better about my finances. Why? I have no clue.
But there were a few small bright spots:
For one, my oldest daughter, out of the blue, paid me back $400. The thing is, while I do "loan" my kids money from time to time, I never really expect to see the money again. My oldest daughter probably owes me around $1300 over the past year but I haven't hounded her for repayment. In fact, I've never mentioned it. That's why it was great to get an early Mother's Day card with her cash inside it. I assume it came from a tax return but whatever the source, I was glad to get it.
Another reason to feel good is that my 403(b) is finally showing signs of health. No, it's not back to where it was in October, 2007. But it's quite a bit above the "under $100,000" point it had dropped to just this past March.
And finally, I realized that April, 2009 was the first month in a long time where every single bill, including every single unexpected expense that suddenly arose, got paid, with no borrowing and no robbing one creditor to pay another. It feels fine, so fine that I want to do it again in May!
But there were a few small bright spots:
For one, my oldest daughter, out of the blue, paid me back $400. The thing is, while I do "loan" my kids money from time to time, I never really expect to see the money again. My oldest daughter probably owes me around $1300 over the past year but I haven't hounded her for repayment. In fact, I've never mentioned it. That's why it was great to get an early Mother's Day card with her cash inside it. I assume it came from a tax return but whatever the source, I was glad to get it.
Another reason to feel good is that my 403(b) is finally showing signs of health. No, it's not back to where it was in October, 2007. But it's quite a bit above the "under $100,000" point it had dropped to just this past March.
And finally, I realized that April, 2009 was the first month in a long time where every single bill, including every single unexpected expense that suddenly arose, got paid, with no borrowing and no robbing one creditor to pay another. It feels fine, so fine that I want to do it again in May!
Wednesday, April 29, 2009
Financial Doldrums & April Update
So I've been blogging about my finances since mid-2007. The general idea has been to self-monitor my debts and, one hopes, watch the indebtedness dwindle. The debts have indeed dwindled, but at an alarmingly slow pace. Here I am, almost two years later, and I've only dented the indebtedness by a total of $4900. Even that hasn't a steady drop--more like a series of rises and falls as life and Murphy keep intervening.
Right now I feel like I'm in the financial doldrums--the fiscal version of the depressing calm that beset sailors in olden times. It's not that anything terrible is happening to me financially. But it's also not like I'm making any great progress on debt reduction, either.
Case in point: For the month of April, I managed to reduce my total indebtedness by a whopping $88.41!
I gotta do better than this if I plan to ever retire debt-free.
Right now I feel like I'm in the financial doldrums--the fiscal version of the depressing calm that beset sailors in olden times. It's not that anything terrible is happening to me financially. But it's also not like I'm making any great progress on debt reduction, either.
Case in point: For the month of April, I managed to reduce my total indebtedness by a whopping $88.41!
I gotta do better than this if I plan to ever retire debt-free.
Friday, April 24, 2009
Five Thoughts for A Friday
A bunch of small things on my mind on this beautiful Friday (The weatherman is promising a nice week-end as well, but he's fickle and untrustworthy.):
1. A fair number of bloggers are getting burned out worrying about their finances. KemKem, at Life As I know It, and Karissa at Keeping It Seriously Simple are both having a bad case of the "Blahs." I know these thoughts only too well. Some might suggest just ignoring the feeling and soldiering on. But I think it is a sign of frugal fatigue and should be combatted by a small amount of personal, fun spending. One nice meal out or a single overnight getaway won't break the bank, and may well help get someone who is suffering back on the frugal track. At least, if we don't do it every week!
2. Earth day came, and Grace came up short, as usual. But I am making one new concession to greening the planet--I am using (mostly, when I remember--currently, I have remembered during two of my last three trips to the grocery store) one of those ubiquitous canvas shopping bags.
3. Mighty Bargain Hunter has a lovely post about help given to a homeless woman. While I could not (or maybe, would not) have charged $55 as easily as he did, I greatly admire his deed.
4. I never thought I would consider an annuity. In fact, they have always seemed to me to be an expensive and not very effective retirement option. But this article from the Wall Street Journal has gotten me thinking.
5. And finally, for those who have e-mailed me to ask--I am feeling great. According to my doctor, whom I saw yesterday, I am the poster child for anyone recovering from heart surgery. I've lost 11 pounds and I'm walking every day--something I should have been doing over the past year. Too bad it took this wake-up call to get me serious about weight loss and exercise!
1. A fair number of bloggers are getting burned out worrying about their finances. KemKem, at Life As I know It, and Karissa at Keeping It Seriously Simple are both having a bad case of the "Blahs." I know these thoughts only too well. Some might suggest just ignoring the feeling and soldiering on. But I think it is a sign of frugal fatigue and should be combatted by a small amount of personal, fun spending. One nice meal out or a single overnight getaway won't break the bank, and may well help get someone who is suffering back on the frugal track. At least, if we don't do it every week!
2. Earth day came, and Grace came up short, as usual. But I am making one new concession to greening the planet--I am using (mostly, when I remember--currently, I have remembered during two of my last three trips to the grocery store) one of those ubiquitous canvas shopping bags.
3. Mighty Bargain Hunter has a lovely post about help given to a homeless woman. While I could not (or maybe, would not) have charged $55 as easily as he did, I greatly admire his deed.
4. I never thought I would consider an annuity. In fact, they have always seemed to me to be an expensive and not very effective retirement option. But this article from the Wall Street Journal has gotten me thinking.
5. And finally, for those who have e-mailed me to ask--I am feeling great. According to my doctor, whom I saw yesterday, I am the poster child for anyone recovering from heart surgery. I've lost 11 pounds and I'm walking every day--something I should have been doing over the past year. Too bad it took this wake-up call to get me serious about weight loss and exercise!
Tuesday, April 21, 2009
The Parking Ticket Rant
ARRGH!
Never mind that I deserved what I got. Never mind that I have no excuses. None of that will prevent me from ranting about parking tickets.
First, I hardly ever take my car to work. I am a firm believer in mass transit; my office subsidizes annual bus passes; I love riding the bus because it gives me uninterrupted reading time.
BUT--part of the fallout from heart surgery is the necessity of doctor's appointments. For whatever reason, all of my appointments have been scheduled mid-day. This means I can't economically use the parking lots near my office because none of them allow "in and out" access. Going in and out twice in the same day is prohibitively expensive.
So I park on the street. At 1.5 hour meters. Which I then sometimes forget about.
That particular brand of forgetfulness costs me $24 a ticket.
Today, I got my 4th ticket in a month.
A total (so far!) of $96!
Money that could have gone to debt reduction. Money that I would much rather have wasted some other way!
May I just say again: ARRGH!
Never mind that I deserved what I got. Never mind that I have no excuses. None of that will prevent me from ranting about parking tickets.
First, I hardly ever take my car to work. I am a firm believer in mass transit; my office subsidizes annual bus passes; I love riding the bus because it gives me uninterrupted reading time.
BUT--part of the fallout from heart surgery is the necessity of doctor's appointments. For whatever reason, all of my appointments have been scheduled mid-day. This means I can't economically use the parking lots near my office because none of them allow "in and out" access. Going in and out twice in the same day is prohibitively expensive.
So I park on the street. At 1.5 hour meters. Which I then sometimes forget about.
That particular brand of forgetfulness costs me $24 a ticket.
Today, I got my 4th ticket in a month.
A total (so far!) of $96!
Money that could have gone to debt reduction. Money that I would much rather have wasted some other way!
May I just say again: ARRGH!
Tuesday, April 14, 2009
Healthy Health Insurance
For obvious reasons (like, say, quadruple bypass heart surgery!) I am grateful that I have health insurance. Mine is through Kaiser. So far, the costs of the initial testing and subsequent surgery total $47,458.12.
My personal costs? $20 in co-pays for two office visits plus another $30 for additional medications.
I went back to work full-time yesterday, exactly four weeks and two days after the surgery.
Health insurance is on my mind because a colleague submitted her resignation in my absence, and I can't help but think she's making a terrible mistake. She's not happy with her supervisor, but the two of them have worked together for over 25 years. What would another couple of years matter?
More importantly, she's only 62. She can get social security, but she won't be eligible for Medicare for another three years. Unfortunately, even if she can afford COBRA (and I'm not sure she can) it will only cover the first 18 months after she leaves. That means she will be uninsured for another 18 months until Medicare kicks in.
Her response? "I'll just go to the emergency room. Besides, I'm healthy."
Umm--Hello? Didn't my experience teach you anything? I thought I was healthy, too. Instead, I've been a walking time bomb for years.
Who wants to risk a $47,000+ debt hanging over their retirement?
Not me, that's for sure. Now if I could just persuade my colleague.
My personal costs? $20 in co-pays for two office visits plus another $30 for additional medications.
I went back to work full-time yesterday, exactly four weeks and two days after the surgery.
Health insurance is on my mind because a colleague submitted her resignation in my absence, and I can't help but think she's making a terrible mistake. She's not happy with her supervisor, but the two of them have worked together for over 25 years. What would another couple of years matter?
More importantly, she's only 62. She can get social security, but she won't be eligible for Medicare for another three years. Unfortunately, even if she can afford COBRA (and I'm not sure she can) it will only cover the first 18 months after she leaves. That means she will be uninsured for another 18 months until Medicare kicks in.
Her response? "I'll just go to the emergency room. Besides, I'm healthy."
Umm--Hello? Didn't my experience teach you anything? I thought I was healthy, too. Instead, I've been a walking time bomb for years.
Who wants to risk a $47,000+ debt hanging over their retirement?
Not me, that's for sure. Now if I could just persuade my colleague.
Monday, April 6, 2009
The Finances of Friendship
Miss M has a new post about friendships and how they are impacted by economic status. I don't disagree with her conclusion that we tend to keep our closest friendships with those who are also close to our class.
But it does cause me to reflect on my closest friendship.
L and I met in graduate school thirty-five years ago. We are both loners. Neither of us married. Depending on where we were living (currently we're in the same city, but we've been as much as 2000 miles apart), the closeness of our relationship has ebbed and flowed.
We discovered early on that we travel well together, so we've always taken vacations with one another. She is the friend I went with to Japan last October.
Since my heart surgery, and after my daughter returned home to her family, L has been dropping by for dinner four nights a week. She has also provided me with transportation since I'm still not released to drive.
We're a lot alike. But NOT financially.
She is quite wealthy and always has been. Not only does she come from a wealthy family, but she has taken private sector jobs that pay very well.
We have worked hard over the years to keep money from being an issue.
We both like to eat out. In general, we take turns paying. When I'm paying, we're likely to hit the local Thai restaurant. When she craves something more exciting and more expensive, she pays. We don't try to keep the money even--just the number of times each of us pays.
On vacations, we tend to agree as to the quality of the lodgings we want--we both want a certain level of comfort, but she never insists on top-drawer accommodations. We both like to play tourist, so I make sure in advance that I can afford the museums and other attraction costs. We both agree to fly coach. Actually, she flies a lot in her job, and she takes coach, then, too.
Shopping has always been a joke between us. She is an inveterate shopper and she loves it. I'm not. I accompany her with a book in hand, and I head for the nearest chair while she scouts out her "must-have" purchases. She comes home from our vacations with at least one extra suitcase of new stuff while I tend to be happy with a couple of bookmarks or coin purses.
But in spite of our class differences and the variance in our financial status, we have remained friends all this time. I would hate to think that something like money could ever change that.
But it does cause me to reflect on my closest friendship.
L and I met in graduate school thirty-five years ago. We are both loners. Neither of us married. Depending on where we were living (currently we're in the same city, but we've been as much as 2000 miles apart), the closeness of our relationship has ebbed and flowed.
We discovered early on that we travel well together, so we've always taken vacations with one another. She is the friend I went with to Japan last October.
Since my heart surgery, and after my daughter returned home to her family, L has been dropping by for dinner four nights a week. She has also provided me with transportation since I'm still not released to drive.
We're a lot alike. But NOT financially.
She is quite wealthy and always has been. Not only does she come from a wealthy family, but she has taken private sector jobs that pay very well.
We have worked hard over the years to keep money from being an issue.
We both like to eat out. In general, we take turns paying. When I'm paying, we're likely to hit the local Thai restaurant. When she craves something more exciting and more expensive, she pays. We don't try to keep the money even--just the number of times each of us pays.
On vacations, we tend to agree as to the quality of the lodgings we want--we both want a certain level of comfort, but she never insists on top-drawer accommodations. We both like to play tourist, so I make sure in advance that I can afford the museums and other attraction costs. We both agree to fly coach. Actually, she flies a lot in her job, and she takes coach, then, too.
Shopping has always been a joke between us. She is an inveterate shopper and she loves it. I'm not. I accompany her with a book in hand, and I head for the nearest chair while she scouts out her "must-have" purchases. She comes home from our vacations with at least one extra suitcase of new stuff while I tend to be happy with a couple of bookmarks or coin purses.
But in spite of our class differences and the variance in our financial status, we have remained friends all this time. I would hate to think that something like money could ever change that.
Thursday, April 2, 2009
Retirement Practice
Even though the damage to my heart turned out to be worse than expected (a quadruple by-pass as opposed to a triple), my recovery could not have been smoother. I've had surprisingly little pain, more energy than I expected, and WAY too much free time on my hands. I won't be allowed to drive for another week and a half, which keeps me at home.
So I'm looking at this as retirement practice.
It is frustratingly clear to me that between now and the time I actually do retire (which, according to my schedule is in 9 years), I'd better have serious plans in place.
Getting up late, reading a lot, and watching daytime television is already getting old and I've only been doing it for three weeks.
I am so BORED!
Part of it, of course, is that my close friends are still working so they are not available to play with me during the day. Also, a "real" retirement would include volunteer activities, writing, travel, and, probably, a car. That latter is a bit iffy since I'm not the world's greatest driver, and who knows how much worse I'll be in another decade.
I am less able to structure my time than I expected--something that will have to change once I retire.
Still, it's been an interesting exercise--and proof to me that I am, in no way, ready to retire right now.
So I'm looking at this as retirement practice.
It is frustratingly clear to me that between now and the time I actually do retire (which, according to my schedule is in 9 years), I'd better have serious plans in place.
Getting up late, reading a lot, and watching daytime television is already getting old and I've only been doing it for three weeks.
I am so BORED!
Part of it, of course, is that my close friends are still working so they are not available to play with me during the day. Also, a "real" retirement would include volunteer activities, writing, travel, and, probably, a car. That latter is a bit iffy since I'm not the world's greatest driver, and who knows how much worse I'll be in another decade.
I am less able to structure my time than I expected--something that will have to change once I retire.
Still, it's been an interesting exercise--and proof to me that I am, in no way, ready to retire right now.
Tuesday, March 31, 2009
Quarterly and Monthly Updates
My net worth, which I figure quarterly, is down 7% to $482,715. No big surprises, there.
On the other hand, I reduced my indebtedness by $828.60 this month.
Focusing on debt-reduction is obviously the way to go these days.
On the other hand, I reduced my indebtedness by $828.60 this month.
Focusing on debt-reduction is obviously the way to go these days.
Sunday, March 22, 2009
Do As I Say---
I read Trent's "A Simple Dollar" regularly but unlike his legions of admirers, I don't necessarily assume that he all the answers all the time. I also susupect that, from time to time, he is driven by financial hubris, as are most of us.
But Saturday's columm regarding his family purchase of a new 2009 Toyota Prius via financing is a revelation--partly of the lengths Trent will go to deny that he hasn't made the most financially sound decision and partly the reprobation of his fans who seem unwilling to cut any slack for a less-than-stellar but hardly devastating purchase.
I worry about bloggers like Trent and JD at Get Rich Slowly who have been set up the role models. I continue to read them because I have so much to learn before I even get where they are. Yet, learning from people who have to be perfect takes a toll from all of us.
Can I just fess up now that I have learned at least as much from MP Dunleavey and the Women in Red? I shake my head at some of her financial machinations because I see my younger self in her actions. But I do rejoice when I see her learn her financial lessons so much sooner than I did.
Give it up, Trent! You WANTED the Prius! You did NOT want to put all of your savings toward the car, so you financed it. Revisit that decision occasionally and tell us how it's working for you. And do it honestly. If it's a mistake but one you're glad you made, so be it. If it is something you have to pay off sooner just to get back to financial peace, admit it and move on. It it turns out to be a disaster, well, let us in on that one, too.
We're all big kids here--we can handle it.
But Saturday's columm regarding his family purchase of a new 2009 Toyota Prius via financing is a revelation--partly of the lengths Trent will go to deny that he hasn't made the most financially sound decision and partly the reprobation of his fans who seem unwilling to cut any slack for a less-than-stellar but hardly devastating purchase.
I worry about bloggers like Trent and JD at Get Rich Slowly who have been set up the role models. I continue to read them because I have so much to learn before I even get where they are. Yet, learning from people who have to be perfect takes a toll from all of us.
Can I just fess up now that I have learned at least as much from MP Dunleavey and the Women in Red? I shake my head at some of her financial machinations because I see my younger self in her actions. But I do rejoice when I see her learn her financial lessons so much sooner than I did.
Give it up, Trent! You WANTED the Prius! You did NOT want to put all of your savings toward the car, so you financed it. Revisit that decision occasionally and tell us how it's working for you. And do it honestly. If it's a mistake but one you're glad you made, so be it. If it is something you have to pay off sooner just to get back to financial peace, admit it and move on. It it turns out to be a disaster, well, let us in on that one, too.
We're all big kids here--we can handle it.
Friday, March 20, 2009
Grace is BAAACK!
One thing you have to admit--medical care in the US is quite the modern miracle. This is apart from all the "soclialized medicine" debates. Where else can one go in to surgery one day, and come out four days later with Frankensteinian staples, four cleaned out arteries (or valves, or SOMETHING!) and not that much pain.
But hey! Step away from the Percocet!
I have lots to say about the financial end of all this, but not a lot of energy.
Be assured that I came through the surgery well and my doctors are pleased with my rate of recovery.
More, later.
But hey! Step away from the Percocet!
I have lots to say about the financial end of all this, but not a lot of energy.
Be assured that I came through the surgery well and my doctors are pleased with my rate of recovery.
More, later.
Thursday, March 12, 2009
Life Whaps Grace Upside the Head
Aging is about more than finances. It's about life's little (and not-so-little) surprises.
While it is my intent to concentrate on finances in this blog, there are times when real life trumps even the money.
Consider Tuesday.
There I was, sitting in a hospital room in one of those ridiculous open-backed gowns, looking at pastel watercolors of a human heart and listening to my cardiologist explain all the ways in which Grace's heart did NOT look like the pretty pictures.
If I'd had any warning, any pain, ANY sign at all that I was in trouble, I might have been more prepared. As it was, I'd come in for an angiogram because a routine stress test had shown "ambiguous" results. That, along with some seriously lousy genetics (mom, dad, grandparents on both sides all had heart conditions) led to the angiogram.
Long story short, I'm undergoing open heart surgery on Saturday. Triple by-pass time.
Funny how finances don't play into situations like this. I didn't even ask about my insurance coverage. I still haven't. I just assume it will mostly cover what I need, and if it doesn't--well, like Scarlett O'Hara in a different context, I'll think about it tomorrow.
Thank God I HAVE health insurance. And a job. And my family. Two of my daughters are professional caregivers, so I'll be in good hands.
I expect to be off the computer for a few days.
After that, I'll explore the finances of aging with much more attention to the details.
While it is my intent to concentrate on finances in this blog, there are times when real life trumps even the money.
Consider Tuesday.
There I was, sitting in a hospital room in one of those ridiculous open-backed gowns, looking at pastel watercolors of a human heart and listening to my cardiologist explain all the ways in which Grace's heart did NOT look like the pretty pictures.
If I'd had any warning, any pain, ANY sign at all that I was in trouble, I might have been more prepared. As it was, I'd come in for an angiogram because a routine stress test had shown "ambiguous" results. That, along with some seriously lousy genetics (mom, dad, grandparents on both sides all had heart conditions) led to the angiogram.
Long story short, I'm undergoing open heart surgery on Saturday. Triple by-pass time.
Funny how finances don't play into situations like this. I didn't even ask about my insurance coverage. I still haven't. I just assume it will mostly cover what I need, and if it doesn't--well, like Scarlett O'Hara in a different context, I'll think about it tomorrow.
Thank God I HAVE health insurance. And a job. And my family. Two of my daughters are professional caregivers, so I'll be in good hands.
I expect to be off the computer for a few days.
After that, I'll explore the finances of aging with much more attention to the details.
Monday, March 9, 2009
Grace Gets With Bonds (Finally!)
In a move that is likely to thrill Living Almost Large who harasses me every time I mention my all-stock retirement portfolio, I have decided to invest 50% of my future contributions into a bond index fund.
Why the change of heart?
Well, first, my 403 (b) funds hit their lowest mark ever last Friday. I use Financial Engines to help me gauge whether I'm on track for retirement. That site gave me just a 48% chance of succeeding with my current mix of investments.
Second, the March issue of "Money" magazine talks about the comparative risks between an all-stock portfolio and a 40% mix of bonds to 60% stocks. According to that article:
"T. Rowe ran the numbers for a 55-year-old with
a $100,000 salary and just $150,000 in savings
who ratcheted up his stock allocation from 40%
to 80% to help his portfolio recover. After
running 10,000 market scenarios, the researchers
found that while the portfolio invested 40% in
stocks replaced an average of 27% of the
investor's salary in retirement, the
80%-stock allocation replaced only
28% - virtually no difference. That's because
while stocks have historically delivered higher
returns over very long periods, over any
10-year period you're more likely to suffer
a few losing years, and there simply isn't
enough time for your gains to compound."
I've always agreed with David Ramsey that bonds might be safe, but they aren't helpful in one's retirement accounts. In my heart-of-hearts, I still believe that, but the volatility of this market is causing me too much distress. Maybe it's my age catching up to me, but I've decided to tone things down a bit. I won't stop contibuting every month, but by moving partway into bonds, at least on a temporary basis, maybe I can stop some of the stomach churning.
I will continue to contribute $1225 a month (plus I get a additional 6% of salary contribution from my employer) but I'm going to put half of that into a bond index fund for the time being. The other half will continue to go to a mix of stock mutual funds. I am not going to reallocate the balances; I'm just adding a bond component.
Why the change of heart?
Well, first, my 403 (b) funds hit their lowest mark ever last Friday. I use Financial Engines to help me gauge whether I'm on track for retirement. That site gave me just a 48% chance of succeeding with my current mix of investments.
Second, the March issue of "Money" magazine talks about the comparative risks between an all-stock portfolio and a 40% mix of bonds to 60% stocks. According to that article:
"T. Rowe ran the numbers for a 55-year-old with
a $100,000 salary and just $150,000 in savings
who ratcheted up his stock allocation from 40%
to 80% to help his portfolio recover. After
running 10,000 market scenarios, the researchers
found that while the portfolio invested 40% in
stocks replaced an average of 27% of the
investor's salary in retirement, the
80%-stock allocation replaced only
28% - virtually no difference. That's because
while stocks have historically delivered higher
returns over very long periods, over any
10-year period you're more likely to suffer
a few losing years, and there simply isn't
enough time for your gains to compound."
I've always agreed with David Ramsey that bonds might be safe, but they aren't helpful in one's retirement accounts. In my heart-of-hearts, I still believe that, but the volatility of this market is causing me too much distress. Maybe it's my age catching up to me, but I've decided to tone things down a bit. I won't stop contibuting every month, but by moving partway into bonds, at least on a temporary basis, maybe I can stop some of the stomach churning.
I will continue to contribute $1225 a month (plus I get a additional 6% of salary contribution from my employer) but I'm going to put half of that into a bond index fund for the time being. The other half will continue to go to a mix of stock mutual funds. I am not going to reallocate the balances; I'm just adding a bond component.
Tuesday, March 3, 2009
It Ain't Murphy; it's Real Life
I was just about to write another "Murphy visits Grace" post when it struck me that I write these kind of posts all the time. I took a brief ramble through my 2008 posts, and, sure enough, every single month I was hit with some unexpected expense. Sometimes it was the car; sometimes it was one of my kids; more than once it was a medical or dental expense; and don't get me started on appliance breakdowns.
But I am finally starting to realize that I have to stop blaming Murphy and start budgeting for real life. Real life, at least in Grace's world, includes at least one monthly unbudgeted expense. Over the course of 2008, this averaged out to an additional $260 a month.
For March, 2009, it will be an unexpected $533 insurance expense.
Yep! More fallout from my garage fire.
My broker had already warned me that when my homeowner's insurance was canceled, it would cost more. She thought she had placed it with a company that charged me almost double my previous payment. Yesterday, it turned out that a computer had accepted my application, but the human adjuster had not. Never mind that I already have my rental house covered by the same company--they do NOT want my business on my residence. My broker finally did get me placed, but now the price has tripled. Hence the check for an additional $533.
Arrgh!
But I am finally starting to realize that I have to stop blaming Murphy and start budgeting for real life. Real life, at least in Grace's world, includes at least one monthly unbudgeted expense. Over the course of 2008, this averaged out to an additional $260 a month.
For March, 2009, it will be an unexpected $533 insurance expense.
Yep! More fallout from my garage fire.
My broker had already warned me that when my homeowner's insurance was canceled, it would cost more. She thought she had placed it with a company that charged me almost double my previous payment. Yesterday, it turned out that a computer had accepted my application, but the human adjuster had not. Never mind that I already have my rental house covered by the same company--they do NOT want my business on my residence. My broker finally did get me placed, but now the price has tripled. Hence the check for an additional $533.
Arrgh!
Sunday, March 1, 2009
Housing Rant
I don't know about you, but I am getting tired of the smug, "blame the stupid/crooked/greedy consumer" attitude floating around too many financial blogs. Therefore I was glad to read Syd's recent post on her blog, Retirement: A Fulltime Job. I particularly like Syd's candid admission that her housing success was more a matter of good luck and great timing than any special financial gifts that she possessed.
I don't excuse the outright liars and cons out there, but running a mortgage scam takes more than one crook--it takes greedy banks that don't check out the information they are given; it takes mortgage brokers willing to make up jobs, income and assets they know don't exist; and it takes a buyer willing to commit fraud to get the house, the money or both.
So let's realize that the folks running cons will always be with us. Let's understand that the only way we can control fraud is to strengthen the controls, increase the number of investigators and provide stronger sanctions.
But that still leaves the "stupid" homebuyers or the "greedy" mortgage-holders.
Just how culpable are they?
In general, I work with people mired in poverty. Lately, many of my clients are new to the ranks of the poverty-stricken. Unlike my more usual clientele, these folks come with real property or have recently walked away from real property.
So far, I've not found greed to be a motivation. Stupidity? More like ignorance. More like feeling middle-class pressure to be a homeowner. And much, much more like being one job or a spouse away from financial disaster.
Consider one woman I deal with.
She and her husband both had full-time jobs. Three years ago, they bought a home in an up and coming neighborhood for a reasonable price with monthly payments that were just under 25% of their combined incomes. They and their two teenagers lived a solid, if not expansive, middle-class life.
Then the mother was diagnosed with cancer.
And then the father turned out not to have paid attention to the "in sickness and in health" part of his marital vows. He bailed out. He quit his job and he left the state. Needless to say, he has not contributed to the mortgage payments.
My client and her children continue to live in the home but it is in foreclosure and it is doubtful that any of the proposed governmental programs will help her. She is upside down in terms of what is owed on the mortgage compared to her existing equity.
Greed? I don't think so.
Stupidity? Well, fifteen years ago, the deadbeat dad probably looked better than he does now, but maybe the marriage was stupid. Buying the house? At the time, it seemed like a great plan, with a good buy, the ability to make the payments with relative ease, and an expectation that if the day came when they couldn't make the payment, they could always sell and live for awhile on the equity.
How about plain bad luck? How about horrible timing?
I'm with Syd on this one.
I don't excuse the outright liars and cons out there, but running a mortgage scam takes more than one crook--it takes greedy banks that don't check out the information they are given; it takes mortgage brokers willing to make up jobs, income and assets they know don't exist; and it takes a buyer willing to commit fraud to get the house, the money or both.
So let's realize that the folks running cons will always be with us. Let's understand that the only way we can control fraud is to strengthen the controls, increase the number of investigators and provide stronger sanctions.
But that still leaves the "stupid" homebuyers or the "greedy" mortgage-holders.
Just how culpable are they?
In general, I work with people mired in poverty. Lately, many of my clients are new to the ranks of the poverty-stricken. Unlike my more usual clientele, these folks come with real property or have recently walked away from real property.
So far, I've not found greed to be a motivation. Stupidity? More like ignorance. More like feeling middle-class pressure to be a homeowner. And much, much more like being one job or a spouse away from financial disaster.
Consider one woman I deal with.
She and her husband both had full-time jobs. Three years ago, they bought a home in an up and coming neighborhood for a reasonable price with monthly payments that were just under 25% of their combined incomes. They and their two teenagers lived a solid, if not expansive, middle-class life.
Then the mother was diagnosed with cancer.
And then the father turned out not to have paid attention to the "in sickness and in health" part of his marital vows. He bailed out. He quit his job and he left the state. Needless to say, he has not contributed to the mortgage payments.
My client and her children continue to live in the home but it is in foreclosure and it is doubtful that any of the proposed governmental programs will help her. She is upside down in terms of what is owed on the mortgage compared to her existing equity.
Greed? I don't think so.
Stupidity? Well, fifteen years ago, the deadbeat dad probably looked better than he does now, but maybe the marriage was stupid. Buying the house? At the time, it seemed like a great plan, with a good buy, the ability to make the payments with relative ease, and an expectation that if the day came when they couldn't make the payment, they could always sell and live for awhile on the equity.
How about plain bad luck? How about horrible timing?
I'm with Syd on this one.
Thursday, February 26, 2009
February Financial Update
Thanks to my income tax refund, my total debt (including my mortgage) is now under $100,000. It's $98,525.51 to be precise. Of that, $21, 374.22 is credit card/personal loan debt and $28,833.14 is my HELOCC. My mortgage has $48,268.15 to go and will be fully paid off on my 65th birthday--a mere five years and one month away.
The numbers are not as important as the fact that the indebtedness is finally going down at a faster rate than my usual sluggish pace.
The numbers are not as important as the fact that the indebtedness is finally going down at a faster rate than my usual sluggish pace.
Monday, February 23, 2009
For Grace It's Good; For The Economy, Not So Much
I just cannot get my mind around the thesis of this article from Sunday's New York times. Thrift has been an economic disaster for Japan? And the only reason the US will avoid Japan's fate is because our citizens will never practice thrift on the level the Japanese do?
I'm not much of an economist (that's what I get for being a liberal arts major!) and I don't pretend to fully understand the global downturn we're all in. But if, for my personal financial security (not to mention, sanity), I must cut back expenses, pay off debt and save for my retirement, it is disturbing to think that all of these things might lead to disaster for this country.
Am I being unpatriotic? Do I "owe" it to my country to save less? Spend more?
How could pauperizing myself be a good thing? Why would it be acceptable if I wind up depending upon state support in my old age rather than Social Security and my 401(K)? And since when is paying off my credit cards a BAD thing?
We live in interesting times, to be sure. I think I mean this in the Chinese curse sense!
I'm not much of an economist (that's what I get for being a liberal arts major!) and I don't pretend to fully understand the global downturn we're all in. But if, for my personal financial security (not to mention, sanity), I must cut back expenses, pay off debt and save for my retirement, it is disturbing to think that all of these things might lead to disaster for this country.
Am I being unpatriotic? Do I "owe" it to my country to save less? Spend more?
How could pauperizing myself be a good thing? Why would it be acceptable if I wind up depending upon state support in my old age rather than Social Security and my 401(K)? And since when is paying off my credit cards a BAD thing?
We live in interesting times, to be sure. I think I mean this in the Chinese curse sense!
Saturday, February 21, 2009
One Down, Five To Go
I love it when money comes even sooner than I expect.
According to the Where's My Refund link at the IRS website, my refund would arrive by March 3rd. Sooner is better--and it came much sooner. The refund landed in my bank account yesterday, a week and a half early and only two and a half weeks after I filed.
So-o-o, I used the money for the things I'd already planned and then used what was left over to pay off my smallest debt.
Amazing how good it feels to see a credit card zeroed out--never mind that the balance was just under a thousand dollars, and it wasn't even my highest-interest card. That's $50 a month I can put to much better use.
I am definitely getting a rush from the payoff. It's psychological, not intellectual. But it's a darn good feeling, just the same.
Onward to the other five debts (not to mention my HELOCC and my mortgage).
According to the Where's My Refund link at the IRS website, my refund would arrive by March 3rd. Sooner is better--and it came much sooner. The refund landed in my bank account yesterday, a week and a half early and only two and a half weeks after I filed.
So-o-o, I used the money for the things I'd already planned and then used what was left over to pay off my smallest debt.
Amazing how good it feels to see a credit card zeroed out--never mind that the balance was just under a thousand dollars, and it wasn't even my highest-interest card. That's $50 a month I can put to much better use.
I am definitely getting a rush from the payoff. It's psychological, not intellectual. But it's a darn good feeling, just the same.
Onward to the other five debts (not to mention my HELOCC and my mortgage).
Sunday, February 15, 2009
Retired But Employed
Saturday's Wall Street Journal article There Goes Retirement profiles a number of retirees whose loss of assets has sent them back into the workplace. None were able to go back to their former positions, none were able to work from home, and none make anything close to the incomes they earned during their "real" working lives. But for most, that isn't the bad news. Whether it's true of everyone or just those who agreed to be interviewed for the article, most seemed happy to have the structure that part-time employment provided, as well as the additional income.
They learned some important lessons that might not be immediately apparent:
(1) Be careful of what you put on your resume when you're applying for an entry-level job. You don't want to scare off a potential employer by appearing over-qualified. (I'm thinking that an accurate resume with a carefully worded cover letter would be the answer here.)
(2) Be careful where you live--a move to a retirement community puts you into heavy competition for limited positions.
(3) Ratchet down your salary expectations. The good news is that you are not supporting yourself on your earnings, you are supplementing a depreciating portfolio. You still have your Social Security and, if you're really fortunate, your pension. $600 a month makes a genuine difference without requiring you to give up all of your free time in retirement.
(4) Don't cut all your ties to your employers and friends in the working world--they can be a good source of "small" or temporary job referrals.
Of course, what is not mentioned is that all of the retirees profiled are still in good health and are physically capable of working. Then again, most of these retirees COULD live comfortably, if not well, on their Social Security and their 401(k)'s. What they did not have was money for the extras--travel, meals out, golf, etc. They also were losing their peace of mind that they would not outlive their assets.
The "I'm retired and I'm leaving the work world behind me" attitude looks to be in for some major readjustments.
They learned some important lessons that might not be immediately apparent:
(1) Be careful of what you put on your resume when you're applying for an entry-level job. You don't want to scare off a potential employer by appearing over-qualified. (I'm thinking that an accurate resume with a carefully worded cover letter would be the answer here.)
(2) Be careful where you live--a move to a retirement community puts you into heavy competition for limited positions.
(3) Ratchet down your salary expectations. The good news is that you are not supporting yourself on your earnings, you are supplementing a depreciating portfolio. You still have your Social Security and, if you're really fortunate, your pension. $600 a month makes a genuine difference without requiring you to give up all of your free time in retirement.
(4) Don't cut all your ties to your employers and friends in the working world--they can be a good source of "small" or temporary job referrals.
Of course, what is not mentioned is that all of the retirees profiled are still in good health and are physically capable of working. Then again, most of these retirees COULD live comfortably, if not well, on their Social Security and their 401(k)'s. What they did not have was money for the extras--travel, meals out, golf, etc. They also were losing their peace of mind that they would not outlive their assets.
The "I'm retired and I'm leaving the work world behind me" attitude looks to be in for some major readjustments.
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