Don’t Feed the Alligators

A Personal Finance Blog from a Small-Scale Landlord’s Perspective

Archive for the 'Weekly Feeding' Category

Lunch

Creative Commons License photo figure credit: kevincole

The last several weeks have been tough and/or busy for us in several ways: the passing of our dog, Thanksgiving, a 4 day business trip combined with ongoing busyness at the office, the hustle and bustle of preparing for Christmas, and — as if that wasn’t enough — preparations for the soon-to-be imminent arrival of Child #2.

So, for my trickle of posts at this space over the last couple of weeks, I apologize.  I give a lot of credit to all the bloggers out there with bigger families than mine who are posting something every day — sometimes on multiple topics and several blogs.  In any event, I want you all to know that I have neither forgotten about, nor abandoned my desire to write about personal finance topics.  So while the near-term schedule really doesn’t show any signs of lightening up, I pledge to at least post more often than I have been.

Now, to get back into the swing of things, I would offer links to several articles that I have been collecting over the last few months:

Juan’s Happy Wife posts here about the economics of home schooling.

Here’s an interesting article that claims an inverse relationship between the age of retirement and ultimate lifespan.  Yikes… I think I’ll retire next week!

Yesterday Boston.com had an analysis that was right up my alley in determining whether it made more sense to borrow from a 401k for a down payment on a house versus paying Private Mortgage Insurance (PMI).

J.D. had a guest post about The Irritation Threshold as it relates to Lifestyle Inflation.

The New York Times had an article on why it’s temping to want to switch to cash, but that risks remain in that strategy.

Lastly, the Wall Street Journal ran a story banks that pay credit card holders to pay off their balances.

Dominoes

Creative Commons License photo figure credit: JL2003

ScrapperMom and I are back from vacation and have been trying to get back into the swing of our routine.  Our almost 21 month old is nearly back on her sleep schedule, which is always a good thing.

Obviously this has been a crazy couple of weeks for anyone who has money, which is mostly everyone — near as I can tell.  I remember where I was for some monumental events in American History over the last 25 years or so (since about the time I understood what news was…), and I have to wonder whether I’ll look back and remember driving out of Disney World the day that I found out the Bank of America bought Merrill Lynch and set off a 500 point market drop.  Will this ultimately end up being the straw that broke the camel’s back?  I wondered at that moment whether we should not have put the money we spent on the vacation into an emergency fund instead, and whether or when we would next be able to take such a vacation…

On that upbeat note, here’s a few articles that caught my eye over the last couple of weeks:

Five Cent Nickel gives us a bit of investing perspective here, with my additions in italics:

  • The Dow finished the week down just 34 points after dropping nearly 1000 points over the course of the week
  • In the past month, the Dow is up 40 points
  • Over the past 5 years, the Dow is up 18%
  • Over the past 10 years, the Dow is up 44%

Sure, the Dow isn’t gaining 7%-10% per year as it has historically, but it’s still rising steadily.

J.D. at Get Rich Slowly has some great advice for the vast majority of investors here:

  • Don’t panic.
  • Tune out the media.
  • Remember your goals.
  • Focus on the fundamentals.
  • Know your risk tolerance.
  • Educate yourself.

David at My Two Dollars has a great article on why we need healthcare reform ASAP.  I agree with David, as is evident in the spirited discussion that follows.  I believe that the single best way to increase freedom in the United States is to take away the fear of having the money to pay for medical care.  Not everybody “deserves” a flat screen TV, SUV, dinners out, etc., but as humans, we all deserve health care.  (And since the government can afford a $1 Trillion bailout of the financial industry, surely it can also afford healthcare for the people of the wealthiest country on the planet.)

J.D. has another interesting article about saving money by avoiding advertising.  Look for a similar article on this at this site soon…

Lastly, David has a nice quote from Paul Mccartney.  You can click here to read it.

09.07.2008
Cardinals

Creative Commons License photo figure credit: linda_yvonne

It’s been a few weeks since I’ve had a chance to highlight some of my favorite articles in the rest of the blogosphere, so here’s what’s been going on:

Gather Little by Little tells us what the dumbest thing on which he ever spent money is.  He asks what others’ dumbest purchases are.  The first thing that comes to mind for me is a Bowflex machine.  It really did seem like a good “investment” in our health at the time, but like many things, it was too good to be true, and in retrospect way overpriced for what you get (a lot like a certain speaker company’s products that rhyme with “nose”).  A close second is a pair of those Ionic Breeze air cleaners.  At least we bought them on Ebay and saved a lot of money off of the MSRP.

GLBL also has a great guest write up on how to start an envelope budget system.  This is not the system that we use, but the best system for you is the one that works, so if you’re still looking, give this a read.

FrugalBabe writes about missing a home owners’ association payment and getting hit with a late payment as a consequence.  Her excuse is that they don’t actually bill her.  I’m a big fan of making things automatic, and I suggested setting up an automatic bill payment with her bank.  Few people realize that they can set up a billpay payment for things other than utility, credit card, mortgage, and other “typical bills”.  Heck, you can often send your friend a payment for the dinner you split last week.

J.D. at Get Rich Slowly puts it to his readers for suggestions on how to cope with a spending addition.  I don’t think the young woman in this case has an addiction as much as a bad habit.  My advice here again would be: Make it automatic.  Set up a Debt Snowball and then set up automatic payments that take effect the day after she can be sure that her paycheck gets deposited.  Of course she has to cut up her credit cards as well for now, but once she does this, if she doesn’t have the money in her bank account, she won’t be able to spend it.

J.D. also wrote another great post on “The Idea of Having.”  I hear him on this one.  Having “stuff” is a constant struggle for us.  We’re always going through closets and bookshelves and can usually bring ourselves to part with some stuff, but not other stuff that we don’t ever use but that we can’t bring ourselves to throw or give away either.  Sometimes I wish we had to live in just one room so that it would force us to pair things down to that which is truly important.

Pinyo wrote an analysis of when to start taking social security benefits.  He argues that while the starting benefit goes up as you age, you might not live long enough to recoup the difference.  However he missed the fact that a given person’s lifespan also increases with age.  A person born today in the US can be expected to live to 75 on average.  But a person who is already 62 can be expected to live into her 80s.  A person who is already 70 is likely to live into his late 80s.  This has to be factored into a full analysis on when to begin social security benefits.

Lastly, filed under the “just for fun” category, Freakonomics published an article detailing the correlation between states that have high occurrences of Bigfoot sightings and those with high occurrences of UFO sightings.  The best explanation given for this was in the comments section:

It strongly suggests to me that the aliens are Wookies.

— Posted by Doug

PS: I have a deeply discounted Bowflex machine for sale. Seriously.

08.23.2008
Hay is for Horses!

Creative Commons License photo figure credit: law_keven

It’s been a few weeks since I’ve had a chance to compile some of the best things I’ve read lately.  The list below is pretty long, so let’s jump right into it:

I participated in the Carnival of Financial Goals earlier this month with my post on declaring a Financial Independence Day.

NCN wrote about a major motivation for keeping his financial house in order.  As the parent of a young daughter myself, my perspectives on what really is important have changed a lot in the last 2 years, and I certainly can empathize.  It’s great that NCN is in a position that frees him up from having to worry about anything other than family at this time. I hope Baby Girl is doing well.

The Freak-est Links points us to a website run by the Maine State government on how to calculate the value of your public library.  I calculated a $260 annual value of our local library.  Not bad!

Living Almost Large writes about Dreading the Envelope — you know, the one that gets passed at work when someone has a baby or something like that?  This article really changed my perspective on this practice.  I work in a relatively small office (~20 people).  A few months back a co-worker’s house burned to the ground.  He lost everything.  This was the only time that the envelope has been passed in the 3 years I’ve worked in this office.  I was torn on if and how much to give.  On the one hand, I can’t even begin to understand how devastating a loss this must have been.  But on the other hand, we’re responsible and have insurance (and so did he), so why should we need to give any money at all?  In any event, this situation is a true need compared to a birthday or baby shower, and in that light I will not hesitate to give more should the occasion ever present itself again.

Glbl asks for reader input on whether money earmarked for college should be given in one lump sum or allocated over time.  Many argue that young adults are still too immature to handle large sums of money responsibly (ie not blow it all in Vegas instead of using it for tuition…).  My argument, however, was that most young adults are “too immature” because they haven’t had the proper training on how to handle money.  So use this opportunity as a chance to educate the recipient on how to be financially responsible, budget, etc.  Otherwise you’re putting the cart before the horse.

J.D. writes about how to support your favorite bloggers (cough, cough).  While I don’t have any ads on Don’t Feed the Alligators at this time, most of the suggestions are still apt:

  • Participate in the discussion — really, please do! You can do so anonymously, and I never share or reveal email addresses, even if I know who you are.
  • Tell your friends — word of mouth, or email both work great!
  • Click on ads that truly interest you — not applicable here, but works well elsewhere
  • Link to stories that you like — if you’ve got your own blog or website and see a story you like, how about a linkback?

Madison writes about how to earn free money using the US Mint.  While this scheme is not for everyone, it certainly piqued my interest.

A spirited discussion follow David’s post on the large percentage of American corporations that pay no federal income taxes.  The biggest point that I would like to make here is that if you’re going to argue with someone and cite a fact, you have to be able to back up the fact with something other than the equivalent of saying, “It’s true, look it up!”  I never took debate classes, but it seems to me that it is the arguer’s job to look it up, not the audience he is trying to convince.  At the very best case, it doesn’t make for a very compelling argument.

Lastly and just for fun, J.D. links to a video made by two average guys who “compete” in a number of Olympic events and compare their results to those of Olympic caliber athletes.  This really underscores how incredible Olympic athletes are.  Hats off to all competitors and especially to US Gold Medal winners!

Tune in next time for a very special blognouncement!

08.03.2008
Cash!

Creative Commons License photo figure credit: Unhindered by Talent

Can you believe it’s August already? This weekend we’re relaxing with friends at their home in New Jersey. In the meantime, I hope you enjoy the following:

Hank at MyInvestingBlog.com asks the question:

If you were given $50,000 USD (tax free) today, what would you spend it on?”

I went back and forth on this question. The prudent thing to do would be to pay off the remainder of our low interest debts. The “dream basket” thing to do would be to use it for a down payment on a single family home, keeping our multi-family as an investment property. Paying off our debt would still leave half the money, and with the monthly payments on the debt gone, it would take us only 12 months to save that amount again, which is well within a reasonable amount of time to find and act on a new house. What would you do? Leave a comment here and then head over to the original article to enter for a chance to win an American Express gift card. If you leave a comment there, let me know!

Some other articles that caught my attention this week were:

  • Rocketc wonders if a frugal culture exists at your work place. He feels obligated to eat out with coworkers for fear of missing important business discussions that may ultimately further his career. My office is split between go-outers and brown-baggers, but nearly everyone eats at the office. I admit to feeling not so much peer pressured, but food pressured to be a go-outer, but it’s better for my wallet and my waistline to be a brown-bagger.
  • Boston.com presents a scary article about how many workers are breaking the retirement piggy bank. It’s almost never a good idea to use retirement money for anything but retirement. But you knew that already.
  • J.D. writes about How to Cope with a Lousy 401k Plan. Most of us don’t realize that the plan we have through our job is not the work’s plan, it’s our plan, and we all have the power to change it, especially if we band together with coworkers. Many of these plans aren’t set up by financial experts, and very often the administrators are sold a bill of goods. A little research followed by a little bit of squeaky-wheeling, so to speak, can make a major impact on the size of your nest egg.
  • David posted a list of state sales tax holidays. Tax holidays are a great way to save — especially on big ticket items. However, one should be sure that (a) This item is in your spending plan and not a splurge item (since otherwise you will have not saved anything…) and (b) that you know what the regular price of the item is and what a typical sale price is. In my experience, many stores have no sales on Tax Holidays and bring all of their sale prices back to full price. In many cases, you can actually save more money on the weekend before or after the tax holiday than on the holiday itself for this very reason.
  • Finally, PaidTwice wonders about how much your time is really worth. I, too, have always been skeptical about arguments like this. The key here is to set the baseline appropriately: the choice is between earning $0 and something, not between your regular hourly wage and something. I don’t buy PT’s advice on earning hundreds of dollars per hour since in most cases you can’t actually do that. Yes, you might save a few dollars clipping coupons for a few minutes, but that’s not the same thing as earning $25/hour.