Category Archives: Money Matters

10 Ways to Save Money Today

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Off to Canada for a little swimming, cycling, and running this weekend. One loyal Pressing Pauser asked if I was going to tweet or blog the event. No plans to blog until returning next week. Tweeting is a good idea. Better start following me on twitter to see if I survive the day. Then again, the social media adverse can just wait to see if any new posts begin appearing here next week.

Now, back to regular programming. Miscellaneous ways we’ve recently reduced our overhead.

1A-1E are biggies because auto insurance is a recurring payment. 1A. Cancelled comprehensive and collision insurance on our 2006 car with 86,000 miles on it. 1B. Took an online driver safety course. 1C. Faxed daughter’s driver training completion certificate to insurance agent. 1D. Faxed academic transcripts for good grade discounts. 1E. Informed auto insurance agency that I’ve gone half time at work and therefore will be commuting only half as much.

2. Charge daughters for portion of cell phone service, Netflix streaming, and car use. Shrewd readers may protest this is less about “savings” and more about “redistribution”.

3. We’ve been eating out less. Maybe once a week at nice, moderately priced restaurants.

4A. Betrothed had to form a small business back in the day when she started teaching Spanish to elementaries in a before-school program. Biz license cost something like 25-30 dollars. Then we got a Costco business American Express card. Meaning a 4% discount on gas. 4B. Use the simple, free, and excellent “GasBuddy” app to find the cheapest gas around. Here’s the web-based version. We have two Costcos within ten miles and I was perplexed at why their prices varied by 14 cents recently until a friend informed me that they are committed to being the cheapest within a five mile radius.

5. Buy movie tickets in advance at Costco. Ocho dollares per. And NEVER buy popcorn, candy, or coke at the theatre. Scratch that. Never say never. Bought some very lightly buttered organic popcorn at the hippie theatre awhile back. Thought my wallet and ticker could handle that. Even went crazy and splurged on a coke for my date. Yes, of course that turned her on (even more than normal).

6. Except for Sunset magazine (promotion price was $10 or 12/year), we’ve let most of our subscriptions expire. Tend to read on-line periodicals and papers.

7. My running shoes cost $130, but I hunt for previous models (all that’s different is the color) on-line and can usually find them for 50% off. I recently bought six pairs for $65/per. No taxes and free shipping. I’m covered for a few years even in the case of economic apocalypse.

8. GalPal has a garden with beans, lettuce, and we have lots of wild strawbs around the yard. Haven’t taken the time to calculate the cost of seeds, soil, etc. Labor is free because she enjoys it.

9. I use a few coupons at the grocery store. Takes almond milk from sup expensive to just plain expensive. Used a Fred Meyer coup. yesterday. Two half gallons of Dreyers ice cream for $5. I had planned to wait til after Iron-person Canada to dive into those babies, but you know what they say about the best plans.

10. Decided not to buy the new Lebron James shoes even though I could probably slam dunk in them, catch the eye of an NBA general manager, and make a little more than I do teaching.

$315. At that price, I should be able to do a 360 degree dunk in them.

When to Retire?

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Most people retire as soon as they think they can afford to. Every week personal finance periodicals run stories about people delaying retirement due to the housing correction, health insurance inflation, and in the end, insufficient savings.

Look around and you can’t help but see older workers. Prepare to see more and more. A boatload of sixty, lots of seventy, and even some eighty something half or full-time employees.

While tossing the majority of my mom’s office files last week, I came across a remarkable memo my dad wrote on December 3rd, 1990 to the two owners of the major corporation he was running at the time. Here it is:

The three of us should sit down and have a talk. I’m 65 in 1991, and as we have discussed pensions around the office we’ve used 12/31/91 as my retirement date. We should discuss the future leadership of S&E. I find myself ambivalent about retiring or staying on.

He then listed the “PRO’s for staying” including “we are an organization that works and we have good sales and profit growth.” Then he shifted gears:

The CON’s are: I will have been at the helm for 7 years, and a change in leadership could bring fresh ideas, a different approach and faster sales and profit growth.

Age slows one. It’s something none of us avoid. I find myself like the aging ballplayer—I don’t want to stay on when new leadership could take S&E forward more effectively. Others see the slow down before you do.

I feel too strongly about the company and its future to become an impediment. What are your feelings?

The more I reflect on this memo, the more unique I find it that he’s putting the company’s interests before his own. No one enjoyed his work more than my dad and no one out worked him. Yet, he acknowledges “new leadership could take S&E forward more effectively.” That’s like President Obama saying someone else might have a better working relationship with Congress and accomplish more on behalf of the American people. Or an aging college professor saying students might benefit more from an energetic, 30-something academic.

I don’t begrudge any older, moderate income person their decision to work past their prime, but for older, financially secure people, my dad provides a selfless example worth emulating. The question isn’t just what’s best for me, but what’s best for the company or even the community.

Footnote to the story. The owners did sit down with my dad. Shortly afterwards they extended his contract and also named him Chief Executive Officer of a second corporation they owned.

How About a Vehicle Mileage Tax?

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To deal with population growth, traffic density, and global warming.

From Slate Magazine.

Looking for a way to raise money for roads and public transit, San Francisco Bay Area transportation officials have decided to look into a novel idea: Taxing drivers for every mile they drive. The hypothetical tax—which at this point is only being studied as part of a long-range plan—could run from as little as a penny to as much as a dime per mile, perhaps depending on the time of day, according to the Associated Press.

The VMT (vehicle miles traveled) tax, the thinking goes, would not only bring in new revenue but encourage people to drive less. The San Jose Mercury News reports that small pilot tests of a VMT tax in cities in Oregon and Washington have shown “encouraging” results, with drivers reducing their total mileage to save money.

Sure, but how does the government propose to keep track of the number of miles that every driver drives? Under the idea being studied by the San Francisco-area Metropolitan Transportation Commission, the Mercury News’ Mike Rosenberg explains, “Drivers would likely have to install GPS-like trackers on their cars to tally travel in the nine-county Bay Area, from freeways to neighborhood streets, with only low-income people exempted.”

Oh but don’t worry, the government would never dream of using these tracking devices for anything except tallying the total number of miles you drive. “The last thing we’re interested in is where you go and what you do,” a commission spokesman told the AP.

Here’s how a free-market, true believer, business friend of mine responded to the idea in an email:

Now there is a great plan – lets get people to drive less so more businesses can fail.  Oh, if more businesses fail that mean less tax collections, and therefore leads to higher unemployment.  But wait, we can raise taxes on the successful companies and the people who buy from them can be taxed higher also….I am sure the idiot who proposed this plan, failed Econ 101.  Government can not collect more from a soft economy without slowing it down further.

That same friend often tells me I don’t know shit about business, but even as clueless as I am, I can’t help but wonder why the correlation between miles driven and economic growth is so obvious in his thinking. The pilot studies show people actually save money as a result of driving less. And can’t we presume they spend most of their savings? Albeit at places like Amazon.com. And would the miles driven/economic growth correlation, whatever it might be right now, weaken if urban planners designed more walkable and bicycling friendly neighborhoods, if people began carpooling, or taking public transportation, and/or cycling, and if people purchased even more of what the need and want on-line?

 

Why Are You Preoccupied With How Others Perceive You?

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The real question of course is why do we care about how people, in many cases whom we don’t even know well, think about us? Odd how often we willfully hand over how we feel about ourselves to the vagaries of total strangers.

Kraznic has an excellent chapter on money in Wonderbox. He writes eloquently on how status anxiety begets mindless consumerism. We all suffer from status anxiety in different ways and to different degrees. I’m convinced we all suffer from it more than we realize or are willing to admit. Who me? Status anxiety?

When Sixteen spends half an hour on her hair before school, her status anxiety is easy to detect. And developmental psychology helps us understand the normalcy of that, but I will probably never fully understand women and their hair. I realized this anew after receiving an email from my sissy about my mother whom she’s helping move into a new apartment building for seasoned citizens. Today Mother Dear was getting her hair “done” for the first time by the new apartment building’s stylist. And my sissy provided the long distance play-by-play:

Mom is sure the girl will be horrible. We had R take photos from every direction of her newly done hair last week, put it on the iPad and I just showed the photos to the hair girl. She has been doing hair for 42 years so we’ll see.

Picturing the picture taking and thinking about my mom’s anxious pessimism made me chuckle, but then just as quickly they made me think about how we never entirely stop caring about our status.

What are others going to think about me when they see my hair? What about the lawn? How does it compare to the neighbors? The car? The wardrobe? The size of the ring? My waistline, muscles, curves, complexion? The kitchen countertops? The gas grill? The cupboards? The whole damn house? How about the social calendar? The number of friends? The friends’ status? The job title? The salary? The vacation destination? The long-distance triathlon finishing time? The blog readership? The children’s athletic success, academic success, college choices? Their job titles? Their salaries? And the beat (down) goes on.

Madison Avenue is genius at playing on our status anxiety, but it’s too simplistic to blame advertising execs for the sum total of it. There’s something deeper at work, something rooted in human nature. In prehistory, I imagine there was fire envy. “Damn, just look at that family’s raging fire. Yeah and their spears are insanely sharp and hella lethal.”

The goal isn’t to not care at all, it’s to care much less especially about what anonymous others think. When Nineteen was seven her second grade teacher asked me to do a guest lesson on China which I had recently visited. Knowing Seven’s social life was hanging in the balance, I planned a meticulous lesson based on three open-ended questions and some slides from which her classmates and she could deduce answers. Afterwards I bent down and asked, “How’d it go?” And I’ll never forget her words because they were the highest praise I’ve ever received as a long-time, successful educator. “You were perfect Dad.” I want my students to like my courses. And I want my Saturday morning running friends to laugh at my ribald jokes. But I care most about what my wife and daughters think about me.

Tonight, when fifteen other cyclists and I hit the base of Bordeaux in Capitol Forest, and the climb is on in earnest, all we’ll hear is one another’s heavy breathing. The prize for being the first one to the top? Status as the “King of the Mountain”. The same game I lived to play in construction sites forty plus years ago. Everyone will know who the biggest badass is on the return into town.

If I start providing other examples of how I routinely succumb to status anxiety, this post would be my all-time longest, and no one wants that. So let me end with a twist on status anxiety just to illustrate how irrational its grasp can be at times.

I wrote once before that, in 2008, I bought a seal gray Porsche Cayman. It was beautiful and drove entirely different than any other car I’ve ever owned. Mother-Dear says, “You can’t love something that can’t you love back,” so suffice to say, I liked it a whole, whole lot. Originally, that is. Over time, I grew self conscious, increasingly uncomfortable about what other people thought of me when they saw me in it. Did they think that I thought I was better than them because my car was way faster, more expensive, and stylish? A lot of people probably buy Porsches exactly for that reason, but I couldn’t shake the self consciousness. And so I sold it. To a German Microsoftie.

Why did I care so much about what people at church or work thought about what I drove when they don’t really know me? [Dear Microsoftie, I’d like a do-over, a Porsche-based exercise in overcoming status anxiety. Make like Carly Rae and Call Me Maybe.] Ultimately, why do I care about what anyone outside of my family thinks about my (amazing) hair, my (splendid) kitchen counters, my (now completely forgettable) car, or my (still-to-be-determined) triathlon time?

Recovering from training with la ultima status symbol—Australian labradoodle extraordinaire.

A Work in Progress

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I need a personal motto.

A recent headline from Yahoo Personal Finance (YPF) read, “Apple Rebounds to $600, Time to Buy?” For the love of investing fundamentals, someone please alert the knuckleheads at YPF that the objective is to buy low and sell high. “Apple Plummets to $400, Time to Buy?” would make a hell of a lot more sense.

Unless of course Apple is headed to $1,001. Which leads to another recent YPF headline, “Top Analyst Thinks Apple Could Hit $1,001”. “Top Analyst” is code for really smart dude who knows way more than you and me. So I guess we should believe him. Wait. He’s also referred to as a “market pro” which means we HAVE to believe him. Thank you top analyst market pro. Since each of my APPL shares is about to go up $400, I think I”ll buy that Cervelo R5 bicycle I’ve had my eye on. More evidence of his intelligence—he covers his ass with “Could”. Here are some other “Could” headlines:

• Relative Unknown Ron Byrnes Could Win the British Open

• The Seattle Mariners Could Win the American League West

• Presidential Candidates Could Take the High Road

• Despite Barely Passing High School Chemistry, Ron Byrnes Could Cure Cancer

Then there’s “Dr. Drew” who received $250k to promote Glaxo’s antidepressant drug. Of course Double D never revealed anything about the payments. Most egregious, he repeatedly used his television pulpit to say it helped cure problems that exceeded what the FDA approved it for. Another doc (among many) was paid a cool $2m to promote the drug.

Daily reminders to read between the lines and remember things aren’t always as they may appear. Reminders too to get some splashy adjectives or a personal motto for yourself.

Cable news networks do it. CNN is “The Most Trusted Name in News”. The Supreme Court rejects health care mandate. Opps! Fox News is “Fair and Balanced.” Opps! And regular people who make wild-ass stock predictions do it. Top analyst, market pro. Another recent YPF headline read, “Goldman’s ‘Rock Star’ Gives His Market Outlook”.

Maybe I should follow suit. The examples illustrate an essential element of moniker or motto making. They don’t have to be true. Repeat them enough and create a hypnotic effect. So aim really, really high.

I’m thinking something like “Ron Byrnes, rock star blogger, friend of small animals, a tribute to humanity.” On second thought, it’s probably unwise to alienate large animals. A work in progress.

No doubt, that right there, “a work in progress,” is what my wonderful wife of 25 years (this week) would recommend for my personal motto.

How to Tap People’s Generosity

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Through detailed, well told personal stories of individuals dealing with identifiable difficulties.

Exhibit A—The grandmama bus monitor who endured bullying at the hands of marauding middle schoolers. The national media shined their light on her plight and a few days later people, moved by her predicament, had sent her $650,000+.

Exhibit B—The young East L.A. boy who built an arcade at his dad’s auto supply storefront. No one knew or cared until one person told his story on-line. Next thing you know his college education was paid for by an army of people moved by his creativity and lack of business success.

Exhibit C—A Mexican-American Seattle resident whose story was told—as part of a series on the recession—on Seattle’s National Public Radio station. Raised in a poor Mexican family. Emigrated to the U.S. Got an engineering degree and a good job with a Seattle firm. He helped his firm determine how much buildings would cost to build. When the recession hit and building ceased, he lost his job. So he opened a taco truck with his brother, but it was a struggle. Until his story was told on the radio. The next day a long line of customers weaved around the block. By mid-afternoon, they had run out of food. While the taco truck took off, other listeners offered him good jobs. In the end, building picked back up and his original employer offered him his job back. He took it.

Forget generic pleas to fight ageism, or the cost of higher education, or economic dislocation. People want to feel like their donation is helping a specific person.

The problem with this of course is that the most vulnerable people, who are the most in need, rarely have their stories told by the media.

A related question is how can governments, whether local, state, or the federal government, leverage this element of human nature to get people to see the potential benefits of selective tax increases? Governments would be well served by telling compelling stories of how individual people, families, or communities benefit from public spending.

How to Reign in Health Costs—Build Sidewalks and Bike Lanes

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If I promised to give you two dollars five years from today, for one dollar right now, would you give me the dollar? What if I promised to give you twice as much of a much larger sum right now? Could you scrape together the funds and muster up the self-discipline to wait for your return? What about your family and friends?

Great article by Mike Maciag in “Governing the State’s and Localities”. Thanks to “Dan Dan the Transpo Man” for forwarding the link.

In short, cities with more walkers and cyclists are less obese. Key excerpts:

• An estimated 35 percent of U.S. adults are obese, and another third still maintain weights exceeding those deemed healthy. This doesn’t bode well for governments and individuals paying insurance premiums, especially with the country’s aging population.

• Historically, studies have linked trails, sidewalks and bike lanes with an increase in walking or cycling. As medical costs continue to rise and evidence mounts that such infrastructure also improves well-being, more officials might look to give health consideration greater standing in transportation planning.

• While only a fraction of workers in an area may opt to bike or walk to work, having the necessary infrastructure in place compels others to use it more regularly.

• . . . the correlation between commuting and residents not considered obese nor overweight was strong–16 percent greater than the relationship with median household income.

• When cutting expenses, health costs are an easy target. A recent study by two Lehigh University researchers reported obesity-related costs accounted for $190 billion annually in U.S. health expenditures, nearly 21 percent of the country’s total bill.

• Those looking to move can use the popular walkscore.com website to measure how accessible an apartment or home’s various neighborhood amenities are on foot.

The problem is we’re not financially savvy enough to tax ourselves—say in terms of raising the federal gas tax by a $1/gallon—in the short-term to fund the necessary walking and cycling infrastructure in the medium-term that would lead to health cost savings in the long-term. Collectively, we’re unwilling to pay a little more for a hybrid when the “buy back” is somewhere down the road.

In our Southeast Olympia corner of the world, the Byrnes family’s walkabililty score is a pathetic 18 out of 100. On the other hand, we’re blessed with wonderful sidewalks and bike lanes almost everywhere. Maybe I should start using them. Maybe I should walk more. Or run. Or cycle.

Just one of many nice bike lanes in the State capitol.

Despite the blue, cars still pass cyclists then turn right. Too often, out of sight, out of mind. Ride defensively my friends (said the most interesting man in the world).

I Recommend

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• My new personal favorite money blog—Mr. Money Mustache. MMM started in April 2011 and he’s killing it. The DIY (Do It Yourself) Colorado bicycle riding blogger writes well and employs a nice mix of confidence, humor, disgust at the status quo, and personal finance insight. His alternative approach to life is resonating with lots of readers. Recently he’s added case studies based upon readers’ lives. Check this recent one out. Favorite excerpt, “Every young adult should be able to comfortably sleep on somebody’s floor, drive an old manual-transmission car with rust holes to a concert, and eat leftover pizza for breakfast. Without complaining.”

• Groovy post by The Minimalist Mom.

• Provocative and timely essay on Chronic Traumatic Encephalopathy (CTE) and what the end of football might look like.

• “Glee is an Immoral Television Show and It’s Time to Stop Watching It.” Trenchant critique by a young, smart, prolific blogger.

• Errol Morris documentary film, Tabloid, about Joyce McKinney, an unstable woman with a criminal disposition. Sex, religion, crime, all mixed together. The one Netflix viewer who wrote, ” She does not need a movie made about her. She needs some real help” is correct. On the other hand, deviance is often interesting because it provides contrast. See Grizzly Man and Take Shelter. I found the most fascinating character to be a minor one, a British tabloid journalist whose total lack of conscience was harrowing.

• Badass video—6 minutes.

Light a Candle or Curse the Darkness?

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Is quality of life improving? Depends on the person or people and the place right? What about your quality of life, your family’s, your friends’, the majority of people who live in your community?

I’m conflicted. I believe the U.S. is in decline. And because both political parties approach government as a zero-sum game making bipartisanship a relic of previous centuries, I have no confidence that government will slow or reverse the decline. Health insurance and higher education inflation are major negatives.

Also, Edward Conrad aside (short rebuttal), growing inequality is a definite negative and there are still serious cracks in the global economy. Social security funds are supposed to dry up in 2033, right when yours truly will be 71. Wars and security threats abound and our military spending is unsustainable. And if Romney pulls off the upset, he promises to increase it in the short-term, inevitably adding to our unprecedented debt. And finally, my hair continues to recede like the world’s rain forests and UCLA hasn’t beaten USC in football since 2006.

But there are lots of positives for the other side of the ledger, the “light the candle” side. Medical research continues to march on, extending our lives and improving quality of life. Life for many in the poorest countries is gradually improving. Baby apps and my late-adaptor skepticism aside, personal technology has made life better. Writing on this laptop is a marked improvement on the typewriters of my college years. Watching t.v. without commercials, reading electronic newspapers on my iPad without getting ink-stained hands, the value of these things can’t be overstated. Cars keep getting safer, more efficient, and relatively more affordable. Appliances and homes are more energy efficient. Alternative energy technologies make energy independence and reduced military spending a possibility.

Related to that, wise consumers, in many sectors of the economy, are getting more value for their dollar than ever before. A personal example of that. Everyone is complaining about the cost of gas and related things like summer air fares. I just bought a plane ticket to visit Mother Dear mid-summer. I put the time in to get a great fare, $391, Seattle to Tampa. Let’s add in $80 for airport parking and $15 for in-air groceries (to and from) for a total cost of $486. Translating that to time spent working, at $50/hour, that’s 1.2 work days, at $12.50/hour, 5 work days.

What if I drove the 3,200 or 6,400 miles roundtrip? Let’s assume 32mpg for 200 gallons at $4/per for a subtotal of $800 in gasoline. Plus four long days means, 12 meals (@ $10/per) and 3 hotels (@ 90/per) x 2 (for the return)=$780 for a total of $1,580. And let’s add in $120 for an oil change, depreciation, and tire wear and tear. So I could spend eight days on the road at a cost of $1,700 or fly for $486. So I get to spend seven extra days with MD for $1,214 less.

The older most people get the more they succumb to selective perception. They get nostalgic for a Golden Age when young people had shorter hair, fewer tats, read more, and life in general was better. I don’t buy it. I’m not sure there’s ever been a Golden Age of anything. My goal is to light candles more and curse the darkness less.

That’s me in the second row excited to see Mother Dear

Notes from the College Search

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Spent Friday with the Good Wife and Sixteen visiting a private liberal arts college in Spokane, Washington—not the one with the very good Division 1 basketball team. The one with a very good Division 3 basketball team.

My main objective was not to embarrass Second Born by not saying or doing anything to bring myself attention. I was doing really well until mid-day. Early on we learned about the “Three Littles” that every student strives to accomplish. . . 1) get hit by a frisbee; 2) accidentally break a dish in the cafeteria; and 3) catch a “virgin” pine cone—meaning one that hasn’t hit the ground. In the middle of the campus tour, I faked catching a pine cone by droping to the rear, picking one up of the ground, then exclaiming to a few peeps around me, “Look, I did it. I caught a virgin pine cone.” Turned out more than a few people heard. Everyone liked my head fake except Golden Locks.

Thought one. A prediction. Higher education, like every other institution, is changing and will continue to change. However, the pace of change will be slower than the “experts” anticipate. Online “education”, or the cynic in me prefers, “internet coursework”, will continue to challenge the traditional “brick and mortar” model of schooling. Hybrid programs will become more common. But based on Friday’s sample of one, private, read pricey, residential liberal arts education is alive and well. “Spokane” University is thriving despite a relatively small endowment. It’s becoming more selective, it’s improving its already nice facilities, and it feels like there is a lot of positive momentum.

Thought two. A paradox. Many private liberal arts colleges offer financial aid packages that average 30-40% of the tuition and room and board “list price”. This coupled with Washington State’s public universities having to increase tuition 15% annually into the foreseeable future, means many families of high achieving students will find privates more affordable going forward. “Spokane” University has four merit-based scholarship tiers. The higher your grade point average and SAT or ACT score, the greater your financial aid. The second tier is a 3.7 and 1880 on the SAT if I remember correctly. That’s worth something like $15,000 each year. Any high schooler planning on going to college should think long and hard about taking any part-time job that might negatively impact their grades. You’d have to scoop ice-cream part-time at Baskin Robins for five years to make $15,000.

Thought three. Confirmation of a core belief. I believe economic anxiety explains most behavior these days. Especially, but not exclusively, middle and upper middle class parents of K-12 students. One of the day’s events was a panel discussion with four “Spokane” University students answering questions. Of the dozen or so questions asked during the hour, eleven were asked by parents. The only explanation I could think of for that was deep seated anxiety about their children’s futures. I wanted to tell the lady with red hair, who asked a few different questions, to “shut the hell up,” but I had already embarrassed TSwift once. Incredibly aggravating. Free parenting advice—at least try letting your son, who looked like a grown man to me, find his own way.

I took one picture. No, not of the beavers I saw on my run along the edge of the over flowing Spokane River, not of the baby ducklings, and not of the loquacious woman with red hair.

Dig the smart mix-use design

Finally, most importantly, make sure whatever college you decide to attend has plexiglass backboards.