A few favorites from recent trawls around the blogosphere:
Labels:
links
Have you ever thought it would be fun to own a bookstore? Did you think it would be a good way to make a living? Many people say "yes" to the first question, and hopefully nowadays people have no illusions about the second: you may be able to make a living as an independent bookstore owner but you won't get rich.
If you want some details on the finances of an independent bookstore, read this Washington Post article about Politics & Prose, one of the country's most respected independent stores. The owners were quite frank about the money:
Labels:
books,
career,
entrepreneurship
Sometimes I look at the past year and wonder if all the good luck I've had in life is turning out to be a loan that's been called in by the bank. Nothing bad has happened to me personally other than losing some money in the stock market, but I feel like misfortune has been getting closer to me, in the form of bad things happening to my friends and family. In addition to my father's brain tumor and friends losing their jobs and getting divorced, I've had a cousin and a friend diagnosed with very serious cancers. Things were very scary for a while with both of them. Now, miraculously, things are looking pretty good. But none of this came without a cost, both emotional and financial.
Both my friend and my cousin have health insurance, one through an employer and one privately purchased as she is self-employed. But that didn't mean their treatments were affordable. In one case, there was chemo and radiation and major surgery. In the other, there were chemo treatments, a special diet, and a lot of long-distance drives to doctors. Both had to take time off work, unpaid in at least one case. Both of these people have spouses, but neither were making much money. Both couples also had another dependent, either a child or an aging parent. What all this comes down to was that even with insurance, the illness put them in debt.
But here's the upside to this depressing story: people helped. Both my cousin and my friend knew people who organized fund-raising events for them. They were each fortunate enough to have a lot of family and friends who could donate their talents or their services or their products or convince others to do so. In each case, a whole community came together and donated money and showed their support and love in a truly special way. They raised thousands of dollars, but it ended up being about more than just the money, somehow.
All this reminded me of an article I bookmarked months ago: Helping Out With Cash: A Delicate Art (which was an follow up to an earlier article Not Laid Off? How to Aid the Less Fortunate. Both of these articles give some excellent suggestions on how to handle the delicate issue of offering help to someone who may need it, but feel awkward about asking for it or accepting it. It's a more and more common issue these days. I just hope my usual sphere of good fortune will return and no one else I know will need this kind of assistance! How about you? Have you ever been involved in a situation where friends helped raise money for someone in need, or been the recipient of such aid?
Here's a story about a relatively new friend of mine, someone I don't think I've mentioned here before. Let's call her Bella.
Bella is a divorced mom with two teenage kids. She gets child support payments from her ex-husband, but money is tight. She works at least two part time jobs at any given moment, and is always hustling for other little projects. That is what I love about her-- the hustle. She will literally do pretty much any honest job, from bartending to babysitting, to hauling garbage out of someone's basement. Her oldest child obviously picked up on this enterprising attitude, and has already started working, not just for her own pocket money, but realizing that her earnings will help support the household. Things are that tight.
Interestingly, Bella's parents are quite well off. They seem to be a bit oblivious to money matters and don't realize how much of a struggle it is for Bella to make ends meet. And Bella doesn't want to ask for handouts. Their wealth means her kids get nice gifts once in a while, and go to their house in the Hamptons once or twice each summer, but Bella isn't yet desperate enough to ask them for cash support, even though they've given big handouts to her siblings in the past.
Switch gears for a minute, to a dinner I had recently with another friend, who's met Bella many times and known her for years, though they aren't close. This friend, who I'll call Henri, is very successfully self-employed. Though he was worried that the economic downturn could put him in the position of having to lay off some of his small staff, he's actually landed some great deals recently and his business seems to be booming. He mentioned that he needed to hire a new bookkeeper and someone immediately mentioned Bella. Bookkeeping turned out to be among her many past jobs, so it seemed perfect. Since Henri and Bella don't talk that often, someone else said they'd tell her about it and have her call him, and then asked "how much is the pay?" Henri answered "$90,000 plus bonus."
At that point, my jaw dropped, and I wondered if I should apply for the job myself! I make slightly more than that now, but given the kind of growth Henri's business has been having, I wondered if it would be worth riding his coattails! (And hey, I like counting money! And I even worked for a bookkeeper when I was about 13.) In reality, I'm not sure I want to be a bookkeeper-- I think I was just shocked to realize how truly successful he must be if he can employ a whole group of people, many of whom are probably equally (or more) well-paid. I heard later that Bella was also a bit shocked-- when she was told about the job and the potential salary, she seems to have gone into a sort of reverie, saying "$90,000? Do you know how much that would change my life right now? $90,000....."
I would like to say that this story had a happy ending in which Bella and Henri were an employer/employee match made in heaven. But alas, Henri's other bookkeeper might not be leaving after all. And Bella would have a hard time doing the commute into the city for a full-time job-- her kids are at a tricky age to have to fend for themselves in a suburb without good public transportation. And who knows, maybe there was some awkwardness there? It can be weird to mix friendship and business, especially when there is such a disparity in circumstances. Bella is probably my poorest friend right now, and Henri is probably the wealthiest. It's strange-- but they both give me a lot to think about for this blog!
On my post about adjusting to a financial crisis such as losing one's job, a commenter noted
It doesn't sound like you figure unemployment into your emergency plan which makes the scenario that much more stressful!
Labels:
career,
crisis,
expenses,
government
This hardly seems appropriate to New York City this year, where we've had below average temperatures and rain for what seems like months... but somebody, somewhere is having to deal with blistering heat, and that somebody, somewhere might be choosing to save money by doing so without the aid of air conditioning.
In yesterday's New York Times, there was an article called The Unchilled Life:
Lisa Finkelstein, a freelance editor, stopped using the semi-functional air-conditioning and heating unit in her rented cottage in Tallahassee, Fla., two years ago, mostly for economic reasons....Air conditioning is definitely expensive-- my electric bill last August was double any other month of the year except July, and July was only lower because I was away for two weeks. Fortunately, this year's weather has meant I've only turned the A/C on about twice, on humid nights when it was just a bit too sticky to sleep without it.
This summer, she probably has more company in the choice she has made. Shipments of window air-conditioners from manufacturers to distributors were down 39 percent in the first half of this year compared with the first half of last year, according to the Association of Home Appliance Manufacturers in Washington, D.C., and shipments of central air-conditioning units have been down 10 percent a year for the past few years, according to the Air-Conditioning, Heating and Refrigeration Institute in Arlington, Va....
If you need to cut your electric bills this summer, this part of the NY Times article gives some great tips for keeping cool. My favorite is the suggestion to keep your linens in the freezer, which reminds me of another tip someone once gave me: put your underwear in the freezer! The same person also suggested microwaving your underwear to warm up in the winter. And who knows, maybe there's something to be gained from putting it in the blender or the coffeemaker too...Genma Holmes, a 42-year-old mother of three in Nashville, and her husband, Roger, declared their suburban ranch house a no-air-conditioning zone last summer as surging gas prices ate into the profits of their pest control business. Their children — now ages 17, 18, and 23 — were not amused, given that average summer temperatures in Nashville are in the high 80s with around 90 percent humidity....
It was when the family put up an awning and fan over their patio — effectively transforming it into their living room, where they spent about three hours a night grilling, playing games and talking instead of going their separate ways — that they discovered the upside of an uncontrolled climate
“We spent an entire summer getting to know our kids by sitting outside trying to keep our electricity bill down,” said Ms. Holmes, who estimated that the family saved $2,100 last summer; they are repeating the experience this year. “It was very therapeutic and we got closer. We also got thinner — all of our diets changed because we were eating a lot of grilled food. And by the time fall came around, with the change in the economy, we had learned to live off less. So when everyone started talking about how hard things are, we felt like we had already experienced the worst of the worst. It prepared us for the whole year.”
A while back, I posted "Do You Have a Crisis Plan," asking what you would do if you were laid off or had some other sort of financial crisis. But sometimes the question is not just "what will you give up," but "how quickly will you give things up."
An example drawn from real life: a couple in which the husband has just lost his job. The wife is a stay at home mom. They have a lot of home equity, and pretty good savings due to an inheritance, but they have a pretty expensive lifestyle. They also have a few significant one-time expenses planned for later this year: a vacation and a bat mitzvah.
Their savings might last a couple of years if they stay in their current home and make some cutbacks, like taking the kids out of private school. They could also refinance their mortgage to lower their monthly costs a bit, though that could be problematic if no one has a job. They could sell their house and move to a much smaller place with lower maintenance costs. They could cancel the vacation and scale back the bat mitzvah, but they don't want to, for the sake of the kids, and probably, to some extent, keeping up appearances.
The question about these changes is, how much? How fast? People often talk about having a 6-month emergency fund, or a 1-year emergency fund, but what if that isn't long enough? In this particular situation, and in this economy in general, I'd be extremely worried that it could take a very, very long time for the husband to find another job, and it may not be for anything near his previous salary level. If they just coast along trying to economize in minor ways, they could end up in big trouble. But if they were able to sell their house quickly, they'd free up a lot of cash that could significantly extend the time they can survive without anyone working.
Losing a job is a traumatic thing. People are scared and angry. They might feel a lot of self-doubt and shame. They want to put a good face on things, for themselves and for their kids, but also for the world around them: they don't want to admit they're in trouble. Each person's situation will be different, but I think it's important to take a hard, realistic look at your savings and budget and your prospects for getting another job, and then plan for the worst. I don't mean to downplay the significance of a family having to sell their home and turn their lives upside down-- it's not the sort of thing you should or can do at the drop of a hat. But sometimes you just have to act sooner rather than later.
Back to my crisis plan: if I lost my job today, I'd probably give myself a week or two before I tried to find a short-term roommate, given that back-to-school timing would be key-- at another time of year, I might let myself wait a little longer. I would immediately be emailing everyone I'd ever worked with to try to network my way into a new job or at least some consulting work, and based on some connections I have, I think I'd have a pretty good chance at getting at least some part-time income based on that. I'd also be keeping an eye out for any other job I thought I could do. If I saw a retail store with a "we're hiring" sign, I'd apply, even if the money was far less than my current income. I'd probably take the first job I could get, and just keep looking for a better one. If I was unemployed for more than a couple of months, I'd also probably be talking about moving in with Sweetie and renting out my entire apartment. I'd rather make short-term sacrifices right away than have to make more drastic sacrifices after running out of money later. We'll see if the family I mentioned above make the same choice.
Some recent posts from around the blogosphere that I found interesting:
The Minimalist on Income Distribution vs. Happiness (via Love in the Time of Foreclosure)
Two posts from My Money Blog on Malcolm Gladwell's book Outliers: The Story of Success
3 Requirements for a Satsifying Job
Hard Work, Luck, and Success
Bargaineering on 8 Reasons Credit Cards Beat Debit Cards
Why Real Estate Beats Other Investments from The World of Wealth
Consumerism Commentary ponders whether it's ever ok to steal entertainment
The Wealth Report: How Many Millionaires Did Your City Lose?
Labels:
links
I spent part of my weekend hanging out with a friend who was bemoaning the weedy state of her lawn. I offered to help do some gardening and ended up spending a while crawling around tugging up weeds, which was actually rather pleasant-- probably because it was someone else's yard and I could stop whenever I felt like it!
As I amused myself with this pastime, I found that it put me in a sort of meditative state, as mindless tasks often do. I kept thinking about how I had to yank out as much as possible of the dandelion roots to keep them from growing back. Suddenly, I had a flashback about why I had this fixation on the correct way of pulling out dandelions: it's because I was once paid to do it! I forget how old I was, but I think it was a neighbor across the street who offered to pay me to pull out dandelions, but only if I did it correctly. If I presented him with the pulled out dandelions, he would pay me some small amount for each one, but only after counting the roots. It's funny how that lesson has stayed with me ever since. Though I'd forgotten exactly why for approximately 30 years, I don't think I've ever pulled a dandelion without feeling dissatisfied if I didn't pull up the roots.
I did other odd jobs as a kid-- raking, babysitting, stuffing envelopes and writing checks for a bookkeeper-- but I can't think of any specific lessons those jobs taught me that still come into play today (other than the most general things like "grab the baby and run if the house is on fire").
Do you remember little jobs you did as a kid? Did the people who hired you turn it into a lesson and make sure you did it right, or just give you money for trying? Let's hear some stories!
I was thinking the other day about a friend of mine from college, who we sometimes jokingly called Bargain Betty. She came from a very frugal family, and never seems to have felt any need to rebel against that aspect of her upbringing, as some might. She sometimes thought her parents went a bit too far, as in buying the rotten fruit from the mark-down shelf at the supermarket, but otherwise she kept up with all their frugal habits and still does as of the last time I saw her.
It's interesting to look back on it now-- when I was in college, most of my friends were from middle-class families and paying for school was significant, and in some cases a huge burden. None of us had money to burn, but we still had trouble being as frugal as Bargain Betty. I particularly remember that she used very rough generic tissues, while I insisted on the softer Kleenex or Scotties brands. And she always ate whatever food was on her plate, while the rest of us felt free to leave behind any part of our ample buffet meals that didn't please us.
Here's a funny detail: this was back in the days when women wore pantyhose much more frequently. Bargain Betty mentioned that she wore "Rock Bottom Pantyhose," which I'd never heard of. It turned out that Rock Bottom was a discount drugstore chain, but I thought it was someone's clever tagline for some kind of figure-shaping control-top. You know, like rock-hard... bottom, rock bottom... ok, whatever, but it was funny at the time!
Anyway, I always suspected it back then, and the years have borne it out thus far: Bargain Betty will probably retire a lot richer than the rest of us. She put herself through grad school, and helped put her husband through business school. They bought a house in the suburbs where they could send their kids to a good public school. They've had the same car forever and still seem to use a lot of the furniture they've had from their first apartment . Whenever I've eaten dinner at her house, all the leftovers are saved or sent home with the guests. Bargain Betty doesn't worry much about fashion and always buys classic clothes on sale for work. She's not into jewelry or manicures or dying her hair. Her one extravagance was hiring a nanny to take care of the kids before they were in school, since she and her husband both work full-time. And I'm sure she has great discipline about saving and investing, as she once asked me, with a look of concern, whether I was making sure to take advantage of my 401k. Compared to Bargain Betty, I am a raving spendthrift!
It's funny, I suppose all of us have someone in our lives who makes us feel like we could do just a little bit better. That we could try a little bit harder to be as disciplined as they are. And despite loving the person, there's this tension: we wonder if they slightly disapproves of us, and we want them not to disapprove, even as we might also sometimes want to tell them to lighten up and have more fun! For me, I think Bargain Betty may always be that person...
Labels:
education,
friends,
frugality,
saving,
self-image
Don't you hate it when you're sitting outside eating lunch, enjoying some peace, quiet and fresh air on a sunny day, and then someone sits too close to you and proceeds to yack on a cellphone?
Well, I hate it too, except when that person starts talking about money! I couldn't catch all of what this young woman was saying, but here are some snippets:
I can't understand why people can't afford things. If you work in an office you must be making at least $35,000...It's always fascinating to me to overhear things like this. It makes me so curious about the person's finances and other feelings about money. And in this case, it also made me wonder where the heck anyone was paying $200 a month for rent in NYC!
Down there, they can't pay their bills, but they're not stressed out because they're always around people. Up here, everybody's all over the place...
Up here rent is like $200, down there it's like $100...
I know! It's OUTRAGEOUS! Maryland is a nice place to live too. The only thing good here is there's always things to do, but down there you can find things to do too....
It's always money, money, money...
I was going to go to the Bahamas... my mom said she'd pay... but I told her I didn't want her to, because she was saying she wasn't sure when she'd have the money to pay the bill... but she wanted me to come anyway so she'd have company....
Labels:
expenses,
living within one's means,
new york,
overheard,
real estate
Publisher's Weekly just released their annual salary survey results. No big surprise: raises were lower and job dissatisfaction was higher!
Some stats from their data, which was based on 1,408 responses to an online survey sent to the magazine's subscribers:
Median Compensation Based on Years Experience:(The survey sample is small enough that some oddities emerge here-- I'm sure managment salaries don't really tend to be lowest for people with 3-6 years experience!)
Less than 3 3 to 6 7 to 10 Over 10 Editorial $32,000 $40,000 $54,500 $80,250 Sales/Marketing 35,000 45,000 60,000 95,000 Management 93,250 77,625 94,500 132,000 Operations 37,750 42,750 60,000 74,500
Over the last couple of weeks, I've made some more efforts to streamline my financial life a bit.
I set up auto credit card payment on my cable internet and local phone bills. For some reason, I hadn't realized this was an option before, and was doing manual e-payments each month from my bank, but I much prefer having everything go on my credit card so I can earn frequent flier miles.
I canceled my long distance telephone service. I know this one will seem like a no-brainer to many of you who have long used their cell phones or Skype, etc., but I was still hanging on! One reason is probably that I had paperless billing. I'd get an email each month and say "Oh, OK, there's the AT&T bill and it's only about $15, no big deal." But when I recently bothered to actually go to the website and see what that $15 had bought me, I found that I'd only made one outgoing long distance call and the rest of the bill was fees and taxes. Minute per minute, that call had become way more expensive than I thought it was, and that was the last straw! I don't like relying on my cell phone for all calls, but I'll just use my Zaptel calling card if I really want to make a call on the landline.
And yes, I know I should probably cancel my landline but I'm just not ready to do that yet. It's another pretty moderate cost and for the time I spend making local calls, it is worthwhile, as I'd have to upgrade my cell minutes if I didn't have the landline. But the annoying thing was that a few months ago, I'd finally had to replace an answering machine I had since college. I bought a phone with a digital answering machine built in, for about $30. Unfortunately, this piece of shit stopped working after a few months and recorded nothing but static. Emails to the manufacturer went unanswered and I'd been procrastinating about buying a new one. Then I started to think about how many people call me on my cell phone anyway, since I'm often not home. A lightbulb went off in my head: I ordered call forwarding service. Yes, this actually costs me about $4.00 a month, but now if I don't pick up, my calls go to my cell phone voicemail, so no answering machine needed, and it's cheaper than using Verizon's voicemail service. And though I could use Google Voice, that would mean telling everyone I had a new number-- this way, I don't have to change the phone number I've used for years and my calls will find me wherever I am. A few dollars spent for a convenience is sometimes worth it.
It's good to take a few minutes to stop and think about these little things. And it goes to show that even someone as financially anal as me can easily miss small money leaks if she doesn't pay close attention to every single bill!
Labels:
credit cards,
frugality,
household,
miscellaneous,
price comparison
I've been following all the hoopla about Chris Anderson's new book with much interest. I picked up a copy of Free: The Future of a Radical Price
But I did find it interesting. Anderson explores the way we've come to expect to get many things for free, and how businesses are using free stuff to make more money from other products or services. Much of this is not new or earth-shattering: give away a free razor to make people buy expensive replacement blades, give away a free newspaper to sell more expensive advertising, etc. The part of this that really has people riled up is relates to the latter-- free content, particularly journalism.
Personal finance blogs are a great example of this-- there are hundreds of us now, all spewing out various sorts of advice and stories and information that you would previously have had to buy a newspaper or magazine or book to obtain. (Or at least your local library would have had to buy it.) Of course, much of the content we spew out is inspired by or derived from content that traditional journalists and authors were paid to write. But if consumers are trained to expect all this for free, is it really a sustainable model? Only time will tell...
Some other things from the book that struck me:
is selling the hardcover for $16.19.
Labels:
books,
economics,
free stuff
This item appeared in an industry newsletter called Shelf Awareness the other day:
When Twenty-third Avenue Books, Portland, Ore., closed suddenly last January, Stephanie Griffin lost more than her business. Willamette Week reported that the owner "became homeless after the store closed. Startled neighbors discovered this in June . . . Griffin had started panhandling outside her old store, which was still empty at the time."
"Most people would ignore me and then say 'Oh, the bookstore used to be there,'" she said. "I would say, 'I used to own that store,' and they would keep walking."
Labels:
books,
career,
economy,
entrepreneurship,
poverty
You know everyone's got the economy on the brain when even the Pope weighs in:
Pope Urges Forming New World Economic Order to Work for the ‘Common Good’
More than two years in the making, “Caritas in Veritate,” or “Charity in Truth,” is Benedict’s third encyclical since he became pope in 2005. Filled with terms like “globalization,” “market economy,” “outsourcing,” “labor unions” and “alternative energy,” it is not surprising that the Italian media reported that the Vatican was having difficulty translating the 144-page document into Latin....
In many ways, the document is a puzzling cross between an anti-globalization tract and a government white paper, another signal that the Vatican does not comfortably fit into traditional political categories of right and left.
“There are paragraphs that sound like Ayn Rand, next to paragraphs that sound like ‘The Grapes of Wrath.’ That’s quite intentional,” Vincent J. Miller, a theologian at the University of Dayton, a Catholic institution in Ohio, said by telephone.
“He’ll wax poetically about the virtuous capitalist, but then he’ll give you this very clear analysis of the ways in which global capital and the shareholder system cause managers to focus on short-term good at the expense of the community, of workers, of the environment.”
Indeed, sometimes Benedict sounds like an old-school European socialist, lamenting the decline of the social welfare state and praising the “importance” of labor unions to protect workers. Without stable work, he noted, people lose hope and tend not to get married and have children.
June wasn't too bad a month-- my net worth increased despite the stock market not being all that great. I'm now at approximately $352,752, an increase of 1.6% from last month. Here's how it divides out. (The figure for Bonds is not up to date, as I haven't visited the Treasury Direct website lately to check on it due to their very complicated log-in process!)
| Cash & Bank Accounts | $47,778 |
| Retirement Accounts | $193,812 |
| Bonds | $4,860 |
| Stocks/Mutual Funds | $13,677 |
| Home Equity | $94,311 |
| Credit Cards | ($1,686) |
| Jan-Jun '08 | Jan-Jun '09 | % var | |
| Income | |||
| Bonus | $15,187 | $11,765 | -23% |
| Gift Received | $100 | $944 | 844% |
| Interest Inc | $605 | $428 | -29% |
| Other Inc | $5,294 | $5,541 | 5% |
| Salary | $46,500 | $48,103 | 3% |
| Tax Refund | $6,024 | $4,211 | -30% |
| TOTAL | $73,710 | $70,992 | -4% |
| Expenses | |||
| Bank Charge | $51 | $70 | 39% |
| Charity | $231 | $261 | 13% |
| Clothing | $1,778 | $1,317 | -26% |
| Dining | $4,305 | $4,079 | -5% |
| Education | $249 | $195 | -21% |
| Entertainment | $104 | $330 | 218% |
| Gifts Given | $997 | -$218 | -122% |
| Household | $867 | $757 | -13% |
| Housing | $7,454 | $10,403 | 40% |
| Medical | $1,001 | $708 | -29% |
| Misc | $3,834 | $1,415 | -63% |
| Taxes Deducted | $17,865 | $16,874 | -6% |
| Recreation | $13 | $0 | -100% |
| Subscriptions | $443 | $461 | 4% |
| Travel | $9,206 | $479 | -95% |
| Utilities | $1,041 | $984 | -5% |
| TOTAL | $49,437 | $38,116 | -23% |
An interesting tidbit from the NY Times:
Behavior: Money Not a Motivator in Losing Weight
Researchers studied 2,407 overweight and obese people enrolled in weight-loss schemes at their jobs. Participants were divided into three groups. The first received $60 for keeping a 5 percent weight loss for a year. The second agreed to pay about $100; the money would be returned if they lost 5 percent of their weight, and they would get bonuses for losing more. The third, a control group, was offered only $20, a reward for staying in the program for a year.The article points out that the study had some limitations that make it far from conclusive. First of all, the amounts of money in the study were quite small, probably not enough to seriously motivate anyone. But it's not exactly practical to try studying the effect of a million dollar bonus for dieting! Also, I believe there have been other studies that have shown that when you pay people to achieve something, it doesn't always help encourage that behavior-- it's as if it obscures the fact that the goal is worth striving for on its own merits.
The study, published by the National Bureau of Economic Research, found that money had very little effect. The group that was offered $60 lost an average of just 1.4 pounds, while the controls lost 1.8. Those who made the $100 deposit dropped an average of 1.9 pounds more than the controls, but, the authors write, people motivated enough to risk their own money would most likely have lost weight with any program.
I just realized today's my 4-year blogoversary. It's hard to believe! I started this site on July 6, 2005 and wrote 46 posts that month, and if you count this one, 1,479 total posts to date!
What a fun ride it's been. I never thought I could churn out this much writing... and I certainly never dreamed it would be mentioned in national media... and best of all, I never knew I'd find so many great people out there in internet-land who'd be willing to read what I have to say and respond with words of advice, encouragement, humor, kindness, curiosity, criticism, outrage, disbelief, befuddlement, marriage proposals, indecent propositions, offers to share their inheritances via direct bank deposit, etc. etc....
Thank you all for being such good company along the way!
This post from The World of Wealth reminded me of something I'd been trying to write about a few months ago. First, an excerpt from MEG's post:
It's been over a month since I joined my new upscale gym, and I have never looked back!
It costs over $130 a month (compared to the $44 a month I used to pay for a regular gym), but I have not had even a twinge of buyer's remorse.....
Going to the gym makes me feel strong, healthy, and energetic, but this one in particular - like any upscale spa or designer boutique - also makes me feel pampered, composed, and worthy.
Also, there is plenty of good eye-candy!
Labels:
clothes,
fashion,
fitness,
food,
health,
new york,
self-image,
social class,
vanity
It was a couple of weeks ago now that I went to visit my parents. It had been a couple of months since I was there, which seemed okay since my father's health has been relatively good, but I was getting anxious about visiting again so I'd have a chance to check on my parents' finances! I'd been hearing lots of stories about all the things my mother was trying to get done around the house, and was starting to worry about how much money she was burning through.
You may wonder why my mother would be doing all this. She's a full-time caregiver to an invalid husband, so where does she find the energy to deal with hiring people to paint the house, pull out trees and shrubs, replace the windows, and put up a new fence? She also had people giving her estimates for repaving the driveway, putting a new roof on the porch, and gutting the one full bathroom in the house. She did acknowledge that this last item was crazy to do given my father's health situation-- which is why she was also getting an estimate on expanding the downstairs half-bathroom into the garage and adding a shower stall.
My mother is just manic when it comes to home improvements and decorating-- it's a bit scary. My father has always checked her impulses to do these things, but now he doesn't have the energy. My mom was also quite inspired by our estate planning conversations with the lawyer several months ago. He said that if my father was about to go into a nursing home, it would be a good idea for us to spend down some assets so he'd be eligible for Medicaid sooner, and that putting money into improving the value of the house was a good way to do that-- music to my mom's ears!
After spending some time going over all my mother's credit card receipts, I had to tell her to put the brakes on any further projects. At the rate she's burning through money, my parents will be broke within 10 years, and this is not even counting major expenses for the house, or funerals, or potential costs like a nursing home. My mom is only 65, so this is a major problem.
When my father first got sick almost a year ago, I went through all their accounts and bills and put together a budget that I thought would allow them to live very comfortably, without changing any of their habits. I was happy to see that the budget would stretch their savings out to last over 20 years. I knew they'd have to be careful about major expenses, but I also knew that some of their expenses would decrease as they got older, so I wasn't too worried. But unfortunately, when I made that budget, I made two major errors. First, I didn't account for the fact that my mother hadn't actually been living with my father for almost a year. I thought it would be enough to take his grocery spending and more than double it. I might even have tripled it, just to be safe. This came to a budget of $775. But now that my mother's back, her actual spending on groceries tends to be more like $1500 a month!
To be fair, she doesn't only buy groceries at the supermarket-- she buys cleaning supplies, paper products, and sometimes plants and cosmetics. But still, it just boggled my mind that she could spend that much, especially since my dad was on chemo for most of the past 6 months and didn't have much of an appetite. I'm still a bit baffled-- she's not eating caviar and steak all the time, and most of her spending is at Stop and Shop, not Whole Foods. I think she just somehow consumes a lot.
The other budget item I got wrong was medicine. Although my dad has supplemental insurance and a prescription plan that gives him better coverage than Medicare, he has so many ailments and takes so many medicines that his co-pays seem to be coming to over $300 a month. I had budgeted about $50 a month, which I should have known was way too low.
When I re-ran all my budget numbers, I felt almost nauseous. It was the same kind of stress I felt when I learned several years ago that my mother had run up $50,000 in credit card debt. I thought since then that she had learned a lesson, and that my openness about the family finances would have cleared up her illusions about there being unlimited funds for her to spend. And in a way, she is being more conscientious-- she's spending money on the house because she thinks the lawyer told her she should. And as far as the rest of the budget went, the problem is that her idea of normal and necessary spending is just different from mine. But it was just extremely frightening to me to feel like my family was speeding towards a financial disaster. I was so wound up and frustrated one night, I ended up just crying in Sweetie's arms.
The next day, I sat my mom down for a talk. I tried to include my dad, as he sometimes seems to feel insulted when he's left out of things, but he walked away halfway through the talk, as if he just couldn't handle being involved. My mother had been jokingly referring to me as "her accountant" and telling the contractors who gave her estimates that she had to "get permission from her bookkeeper" but I tried not to get too dictatorial with her. I told her that I'd looked at over 6 months of her actual expenses and that they were much higher than the budget I'd originally done. I said she could go ahead with having the outside of the house painted, which would have been done already if not for the rain, but that I wanted her to put a total stop on any further household improvements for 6 months, and try to see if she could cut back some areas of her spending, emphasizing that it was her money and her choice in how to spend it, but that once it was gone, there would be no bailout available to her. She could make some moderate changes now, or she'd have to make drastic changes later. I explained that there was not much buffer for emergencies and that the only other source of income she'd have would be a reverse mortgage, which still wouldn't cover her spending at her present level. She didn't seem too happy about it, but asked for a printed out copy of the budget and said she wasn't sure how she could cut back but that she'd try.
I thought I'd gotten through to her but a couple of days later when I was back in New York, she called me at work and then said "you know, I'm still going to just go ahead and have the driveway repaved, it's only a couple thousand dollars." I just lost it. "No, Mom, do NOT repave the driveway. The driveway is fine. This does NOT add value to the house. You can NOT afford it. Would you rather eat for a couple of months or have a smoother driveway?" I was probably a little too harsh and she got off the phone in a bit of a huff but I think sometimes I have to be harsh to get through to her.
I talked to my sister ZZ a little while later and she said "Mom's kind of depressed. She's freaking out about the budget stuff." ZZ also can't get her head around the immense amount spent on groceries, but she did have one good idea for cutting some money out of the budget. My parents spend several thousand dollars a year to have someone do their landscaping and shovel in the winter. ZZ pointed out that she and her husband could just visit more often to mow the lawn in the summer, at least, and that they could probably pay some neighborhood kid much less to help shovel in the winter. We'll see how this works out. I hadn't originally thought the landscaping was something to be cut because I was focused on not causing my parents any extra stress or discomfort, but I need to think more creatively about it. We'll all be trying to find ways to balance their budget over the next few months... we'll see how it goes.
At Get Rich Slowly, there's a great recap of personal finance programs-- web-based and desktop-based, with the availability of iPhone tie-in apps noted. Very useful!
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