About sixteen years ago, I met him for the first time. My trainwreck sibling brought home this adorable puppy he had no business adopting because he had not one thing in his life that wasn’t a mess. I was furious at my sibling – he didn’t even take care of himself, how could he drag
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January 9, 2009
Another one acquaintance has succumbed to the I need to own a home NOW syndrome.
Recently engaged, she and her man have been seriously condo-hunting for a few months now, rejoicing in the fact that housing market is ripe with plums for the picking. She’s not made any PB & J declarations, but they’ve gotten pre-approval for a loan so they feel confident in their ability to secure a purchase of a short sale in the next few months before their summer wedding.
Again, in a purely hypothetical sense, if I were to be asked for my advice …. well, my mental alarms are working overtime.
I’m familiar with some aspects of their finances from a few get-togethers:
The fiance, X, is self-employed. A year into running his own business, he’s done well enough for himself that he’s able to cultivate long-term clients rather than taking every short or long term project that comes his way. That’s quite a good direction to develop. He’s made a good 5-figure income. Plus!
They both have retirement accounts – maybe not fully funded, but definitely funded. Plus!
They scaled back their entire wedding and turned it into more of a backyard affair because they didn’t have anything saved for the wedding, and didn’t want to take on another $10-15K of debt. Good move. Plus!
But, they didn’t have anything for the wedding because X spent about 20K on her ring. I’m not saying there’s a “right” amount to spend, just that they are out that much money that could have been for the wedding or their e-fund. Either way: Minus!
His ladylove, Y, is about to lose her job. She doesn’t know when, but a layoff is imminent. Minus!
Y also hasn’t had any success in landing another job that I know of, and because she’s entirely caught up in wedding planning and house-hunting, I can’t imagine that she’s devoted any time to a job search. Minus!
In my eyes, that’d be the most basic of needs in a three-priority situation like this: Find a job, then get married, then buy a home.
Then, too, my other concerns remain:
Tracking routine expenses – Y loves her clothes, accessories, and expensive tech equipment. She also has no head for caring about numbers. (Note: she doesn’t have to be an expert, just willing to pay attention.) That has to stop if they’re taking on a mortgage with one income while accustomed to two.
Health – Neither will have employer-sponsored health insurance after the job loss. They’re young and healthy, but can’t afford any emergencies or accidents (how well can any of us?). It’d be important to have a contingency plan, whether it be buying insurance or setting aside emergency health money. If nothing else, catastrophic health insurance would be a really good idea.
Moving costs – This would include closing costs and associated fees. I’d hope that they don’t end up paying for unnecessary points or junk fees, but as novice home-buyers, that’s always something to watch out for.
Also, while they may pass on purchasing new furnishings right into their new gates, some maintenance issues will probably come up. They’re looking at short sales, and the condition of those homes are not going to be the same as that of a new build.
Taxes – self-employment, primarily, for both. X, of course, will have planned better for his upcoming tax bill, and Y might have since she did have some contractor income. Those will have to be addressed some time this year.
And I don’t know when property taxes are assessed, but can they afford property taxes? Are they prepared?
Not to be the ultimate party-pooper, but I would strongly urge them to re-assess the commitment they’re about to make together. To the home purchase, not to each other! I think their relationship is fine, but can see how making a hasty, major purchase could strain even the strongest marriage.
What do y’all think? Have I missed anything else?
And what would you do in this situation? Do you think my caution, concern and conservatism are (perhaps, wildly) misplaced?
January 8, 2009
Guess the no-bonus unlove was some sort of mistake. Corporate will be cutting a new one and sending it out to me in the amount of ….. not very much!
I’m not complaining, nor am I surprised that it’s only going to be $300. It’s not even being called a bonus, it’s marked as a Holiday Gift.
Guess I’m just bemused. We’ve been “spoiled” in the past by the generous bonuses, and they were all instrumental in my progress through the years, but my budget never hinged on them. (Thank goodness!)
Hah, it just occurred to me that it’s so small that I don’t even have to worry about how this impacts the tax planning. Every cloud and silver lining, right?
Anyway, it’ll probably go right into the emergency fund, that’ll be nice.
January 7, 2009
There have been more careless spending times in my life, but the last few weeks have to be right up there with the best (worst?) of them. It looks like I’ve just been wildly swiping my credit card, always picking the one with the best rewards as applicable, of course, so I was a little spazzed about reviewing the totals. Looks like it wasn’t too bad, though, and most of the spending was really goal-oriented: work or health.
Many of the expenses were intended to draw down the remainder of my 2008 FSA account:
4 doctor’s appointments: $60
Prescriptions, new or refills: $19.90
Massage therapy for my medical condition: $55, I hate that stress costs me real money, but it sure teaches me to take better care of myself. And it was budgeted.
Actually, I managed to max out the 08 FSA before I was through. That bumped my eyeglasses replacement order to January.
2009 FSA:
New eyeglasses: $39, after my health care plan’s credit was deducted. Since I’m a novice eyeglasses wearer, and was too harried to properly measure my face, it was worth the time and money to go through my medical plan.
The optician spent a lot of time discussing the options: explaining that the polycarbonate plastic lenses are guaranteed never to break, that silicon nose pads were recommended and swapped them out for me, trimmed the length of the arms and fit them to my face. These were all services that a mail order store couldn’t have performed to my satisfaction. Heck, I didn’t even know to ask about adjusting the length of the arms in the first place! It seemed like a stupid question at the time, but it was even stupider not asking when the glasses were first scripted out.
Nyquil/Dayquil:
$12. Some virus is going around and the orange and green pills are keeping me functional.
Other OTC drugs:
$? Still need to stock up on pain relievers and probably some more cold/flu medication.
Clothing/shoes:
Suit: $11, best deal ever!
Shoes: $30, um, not the best deal ever. But it’s for a good purpose! Matching is a good purpose.
Tailoring: $?, will know the estimate once the jacket and two shirts are dropped off for nips and tucks.
Eating out:
Again, it felt like we ate out a lot. We did more frequently than I’m accustomed to, but it was a combination of eating away from home and eating out. The former was just eating meals at friends’s homes while visiting, while the latter probably consisted of 4 meals for a total of $25.
Just got another email asking if we’re up for dinner, drinks or pool tonight before the last friend straggles back home to NorCal, though.
Happily, lots of the fun stuff was free: hanging out with friends at their houses, watching shows and movies they already had, opening presents that we’d already spent on, etc.
Regardless of the intent, I don’t want to get in the habit of mindlessly spending. It’s way too easy to stop thinking about whether or not I need that item, and just buy ’cause I want it.
January 6, 2009
Does the idea of your salary or net worth being public knowledge make your skin crawl? And I don’t mean within the relatively sheltered PF blogging community where many of us blog anonymously, I mean in your everyday life. Would you share the details of your financial life, to any degree, with friends and family willingly?
I always thought that salary transparency in the workplace made sense for the employees. After all, as the question is commonly asked, what does the company/employee have to lose? The opportunity to be paid a fair wage? The arguments for sharing salary information are cogent, as blogger Penelope Trunk points out that “the only party protected by secrecy is HR ā no one can see how arbitrary salary decisions are. Who wins the highest dollars? Good negotiators, personable people and people who bring in intangible benefits, she says.”
Then again, those not in favor of transparency argue that comparing salaries by job title doesn’t take into account many other factors, like abilities, performance, and motivation. Or negotiation skills.
I’ve recently used both PayScale and Glassdoor to suss out the salary range for my current job as well as my boss’s job to get an idea of what kind of salary requests and expectations are reasonable in my field, yet find myself strangely uncomfortable with the notion of telling a personal friend how much I make.
I feel like I goofed big time this holiday when my best friend in the whole world, with whom I can discuss almost everything, asked me in front of another longtime friend how much I made. (The longtime friend and I aren’t terribly close.)
My big mouth slipped and revealed my base salary, even though she thinks what I consider a modest salary range to be “a lot of money,” right in front of the other friend. Their body language both said “whoa!” Immediately, my reaction was, “aw crap, I should not have gone there!” It’s silly – my discomfort stemmed from not wanting them to think I was rich. I’m not! And I did point out that if I were to make a little more than that, it still wouldn’t be much because moving out would create two households to be supported. But even if they were aware that I make ok money, what does it matter? If they’re going to be part of my network, doesn’t it make sense for them to have an accurate sense of what I’d expect to be paid? Yeah, that doesn’t matter, I still feel weird about it. Even my family doesn’t know how much I make! (There’s a good reason for that: my …special…. brother would definitely assume that I was rolling in easy money and try to take even more advantage of me than he already has.)
How would you feel if your friends knew how much you made? Would you feel comfortable discussing that?
Related reading:
The case for sharing your salary details: MSN Money UK
What Am I Worth?: TheGlassHammer.com
January 5, 2009
A friend just dropped off about 8 pounds of baby bok choy. He volunteers at a charity and occasionally, food donations from farms, grocery stores or whatnot overwhelm their storage, cooking and distribution capacity. This weekend, for example, a farm dropped off two pallets of vegetables. Pallets, not crates, or boxes, pallets stacked with boxes crammed full of leafy green vegetables.
It’s wonderful that those they’re helping will be treated to fresh vegetables, but that’s way too much for them in one go, so they sent the volunteers home with a case, each. I’m going to be eating baby bok choy, fresh, delicious, crunchy, baby bok choy for a WEEK. This is awesome for I love love love bok choy. In fact, my aunt’s family will be, too – there’s no way we can eat up that entire sack of veggies by ourselves.
And while I’m eating that lovely veggie, in soups and various other forms, I’ll be:
Doing laundry.
Emptying out and consolidating the contents of my under-the-desk plastic containers.
Reorganizing the contents of my under-the-bed clothing container and the lift-top bench I have.
Taking an even more critical look at my bookshelf.
Making a decision about my hair. (to cut, or not to cut? How short? What’s perfect interview length?)
Submitting any cover letters and applications necessary.
Tackling the why didn’t I get a bonus when everyone else did? question.
Taking my business clothes to the tailor for some tweaks and nips, in search of a more perfect fit!
January 4, 2009
Welcome to the new year!
Whoo, I haven’t touched the computer in a few days and it feels like an eternity. *petting laptop* Pretty computer, I missed you!
It’s been totally action packed around here, in a quiet, sluggish, sort of way. The pregnant friends from out of town were IN town since the Eve of New Year, as were a few other friends from the East Coast. This meant outings to the local diner, for an old times’ sake dinner of french fries, chili cheese pastrami fries, onion rings, zucchini fries, fried mushrooms, and root beer. Also, a few burgers and burritos were had around the table seating over a dozen chattering 20-somethings.
Ahhh yes, healthy healthy indeed. Even the pregnant lady passed up on salads. š
Other highlights? I watched the first episode of Firefly and loved it. Wish I’d borrowed the DVD to watch more of them tonight as I’m feeling under the weather again.
Spent a ton of time with pregnant friend and family.
Watched The Fellowship of the Ring with my cousin, laughed over our long-ago crushes on Orlando Bloom in that movie.
Ran errands with a friend who sympathetically listened to my stress and woes. Had the same friend help me decide what shoes to buy and shirt to wear with my suit, I want to make the right impression and she’s MUCH better at the coordinating colors thing. Her hubby makes me laugh, he was practically dancing with excitement when she admitted he was right and she was wrong about a color combination.
Caught up with friends I haven’t seen since high school; one of them has many NYC connections through her church with regards to housing and makes it seem like it’s still a possibility. Maybe. We’ll see.
Received my copy of The Good Girl’s Guide to Negotiating. It’s pink, but I haven’t decided if that means it’s fluffy yet. Another “we’ll see.”
I hope my glasses with new lenses come in soon. The optician snipped the ends of the arms so they actually fit around my ears like they should, switched the plastic nose pads for silicon ones (free!) and we’re trying single vision lenses instead of the progressives I got some years ago that give me headaches. I hate to say it but visiting the eye doctor is always more traumatic than anything else, including the dentist!
We’re back into the (work) fray tomorrow so I’ll be seeing a whole lot more computer screen, though not for fun things like blogging, twittering, reading blogs, or researching personal stuff.
I know most people were right back to work between Christmas and New Year so I’m grateful for my extra time off; for once, I’ve really squeezed my money’s worth out of the paid holidays instead of trying to find an excuse to put in more hours. If anything, I feel like it’s been a mini-decompression from the ultra-wound up mode I’m normally in all year. Now I could use a vacation from the vacation! š
January 2, 2009
Has anyone tried booking an airline ticket lately?
I’m checking off another item on my list of things to do, having just booked my flight for a meeting in January and, my goodness, United.com is shilling hard for the upsell.
First, I was redirected to the Economy Plus option for $24/way when I was selecting my flights; when I didn’t take the bait and proceeded to purchase the plain vanilla economy itinerary, I was redirected again.
This time, they had a screen offering me a One Time Deal! Good for Five Minutes! to upgrade to the next class. Goodness, people, this plane probably won’t even have a proper First Class! There was even a little doomsday countdown, showing how much time I had left to come to my senses and snatch up the opportunity to pay another $95 for a FC seat on one of the two flights. Pf, not even both ways at that price? Count me out.