Take a Deep Breath

Posted on September 22, 2008
Filed Under Attitude, Biblical Principles, Uncategorized | Leave a Comment

Housing prices continue to slide. Some of our largest financial institutions are failing or being taken over by the government. The stock market is on a roller coaster ride, with an emphasis on steep dives. Unemployment in the USA is at or near a 5 year high. It’s time to… sit back and take a deep breath. It’s easy to get caught up in the gloom and doom of the moment, especially when it seems there is nothing but bad news. However, I think that things are almost never as bad as they seem. Here is my take (from a Christian perspective) on how to deal with some of the bad financial news that’s been dominating headlines lately.
The Stock Market Meltdown – Having money in the stock market can be kind of distressing right now, particularly if you are close to retirement. My own retirement plan is down over 25% since last year. Remember though, that what goes down will probably come back up. This is a good time to re-evaluate your asset allocation. If you buy individual stocks, it is an opportunity to buy quality companies at a large discount.

Phillipians 4:19 And my God will meet all your needs according to his glorious riches in Christ Jesus.

The Housing Crisis – Are you upside down? If you can still afford to make your payments, then keep making them. Are you behind on payments and in danger of losing your home? Maybe your lender would be willing to do a loan modification. Remember that earth is just a temporary home – our true home is elsewhere.

John 14:2 In my Father’s house are many rooms; if it were not so, I would have told you. I am going there to prepare a place for you.

Unemployment – If you are unemployed, I am sorry for you. Realize that there are resources to help you get through this period. It might be a good chance to cut a lot of dead wood out of your life. It also might be an opportunity to find a better job or a better situation than what you had previously. Also remember here is another type of work besides a job.

1 Corinthians 15:58 Therefore, my dear brothers, stand firm. Always give yourselves fully to the work of the Lord, because you know that your labor in the Lord is not in vain.

What if you’re not a Christian? I think the same principle applies – don’t let yourself become overwhelmed. If you do, you short-circuit your ability to deal with the problem. As the matter of fact, I don’t feel you should focus all your energy on just solving problems. Change the way you see your situation. Spending all your time and energy solving a problem solves the problem, but it doesn’t give you a way forward to where you want to go in life, especially when new problems can keep coming at you. Invest in yourself right now. Gain knowledge. Make new friends. Expand your social and professional networks. Look for new and different opportunities. Your ability to connect with others and make adjustments are valuable assets during hard times.

A $100 Hour – Recycle Aluminum Cans

Posted on September 22, 2008
Filed Under $100 Hour, Snowflakes | Leave a Comment

Isn’t that what homeless people do? Isn’t it a waste of time? Isn’t the money you can get from recycling cans minuscule? No, I haven’t lost my mind. Recycling aluminum cans is, in fact, a viable way to make $100 or more in a relatively short period of time. How do I know this? When my in-laws lived with us, they recycled cans, and I took then to the recycling center for them. The last time I went, they had 231 lbs of cans, which netted them $115.50. Of course, it can take a long time to collect this many cans if you get them by walking down a lonely stretch of highway picking up peoples’ throw aways. Fortunately, there are better (and safer) alternatives.
My in-laws collected most of their cans on “recycling days.” Every other week, the local disposal company collects aluminum cans and other recyclables that are put in special containers and left curb side. On these days, they walked the neighborhood collecting the cans (They had had previously asked permission from the home owners to do this, which is probably a good idea. Most people don’t like strangers poking around in their trash early in the morning).
Another place they picked up quite a few cans was at a local park. During the summer, many people use the park for wedding receptions, company picnics, etc. After these events, the trash cans would have many aluminum cans (along with the trash of course). After getting permission from park personnel, they would collect these cans – making sure not to make a mess while sorting out the cans.
Other possibilities could include putting a can collection basket in a break area at work, asking friends and relatives to save cans for you, and even wandering a stretch of highway.
How much can you make (and how soon)? I turned in cans for my in-laws every other month (8 weeks). While $115.50 was the most they made in an 8 week period, the average was about $90, and they never made less than $70 – not bad for a few hours of work each week.

Cheers,
Ken

A Really Nice Site

Posted on September 19, 2008
Filed Under Uncategorized | 1 Comment

I’ve been looking at tons of blogs lately, most have at least some useful information, none I would actually criticize, but today I happened upon one by chance that has a really clean design and good content. The author says he is 23 – I wish I had as much sense as he seems to when I was 23. Anyway, check it out: joshuabest.net

Cheers,

Ken

God, Gold, Guns, Girls and Green

Posted on September 16, 2008
Filed Under Attitude | Leave a Comment

In a recent post on I Will Teach You To Be Rich, Ramit Sethi takes a blast at a thread on patrick.net about where to invest money. One of the replies is to invest in God, Gold, Guns, Girls and Green. Maybe it was meant to be funny, but actually, it makes a lot of sense. Here are some of the reasons I think so:

God. I’m not advocating tithing. In fact, even though I’m a Christian, I don’t believe in tithing. I do, however, believe in giving money to support the work of the church, and also money to help the poor. Investing in God isn’t limited to giving money though. I can also invest my time and talents. This helps me stay focused on what is important, and not fixated on things that will eventually pass away.

Gold. Well, maybe not Gold, but a gold pan. I’m fortunate to live in an area that was rich in gold and other metals, and there is lots of public land to explore. With gold around $775/oz, it makes looking for it worth while. Even if I don’t find any, I get to spend an enjoyable weekend outdoors, and I can give my kids a lesson in local history. I’m also conveniently far away from places to spend money.

Guns. If you live in a rural area, another excellent investment. I recommend a 20 or 12 ga. shotgun, my favorite is a Remington 870. You can use this for hunting birds and rabbits, as well as recreational activities such as skeet and trap. Wild game is healthier than commercially raised meat, tastes better, and you get lots of good exercise acquiring it.

Girls. I know from personal experience that investing a little money and quality time in my relationship with my wifes pays dividends financially, spiritually, emotionally, and physically. Well worth it.

Green. Invest time walking or bicycling to get where you’re going instead of money on gas. The money you free up can be invested things that have a better ROI. Depending on where you live, you might even be able to install some personal wind generators and sell power back to the utility company.

There you go, 5 things to invest in during this “down” economy. Have fun, don’t take life too seriously, and remember that things are rarely as bad as they seem.

Cheers,

Ken

The $100 Hour

Posted on September 15, 2008
Filed Under Snowflakes | 1 Comment

One of the best ideas I’ve found while reading Making A Living Without A Job is “The $100 Hour.” Basically, you make a pact with yourself to set aside time every day (if possible) or at scheduled intervals and dedicate it to finding an idea that will net you $100. You don’t need to implement the idea in an hour, just come up with it.
The idea is beautiful in both scope and simplicity. If you are just getting started on the road to financial independence, having a few small successes can have a really positive effect not on just your self confidence, but on your cash flow as well.
So what qualifies as a $100 idea? The author gives 18 starter ideas in the book. I would say that in order to qualify as a “good” idea, it should at least meet most of the following criterea:

How easy is it to come up with ideas? The author gives you 18 to get started with, so even if you can’t think of anything on your own you have a place to start. I was able to come up with 5 ideas of my own in the time it took me to read this section of the book. Yesterday before church I sat down with a notebook to seriously brain storm this and came up with a list of 70 more, and I am not exactly a model of creativity. I’ll be presenting them here over the next few months. In the mean time, time to start implementing them. If you see one you like, feel free to use it yourself and let me know how it goes.

Cheers,
Ken

Divide and Conquer Your Way to $10,000

Posted on September 12, 2008
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I’ve been reading about the importance of having a definite goal, so I decided that my goal this year is to earn $10,000 over and above my salary, by the end of this year. I don’t know about you, but to me that is a lot of money to come up with in a little less than 4 months. In fact, if I spent the next 4 months thinking about a way to make $10,000 I would probably fail. In fact, I would probably not be able to come up with a way to make $1,000.

Breaking it down, though, makes the task seem a lot easier. 10,000 is really just 100 times 100, and I can think of at least several ways to earn $100 – maybe not 100 ways right now, but at least enough to get me started. In fact, last week I sold 9 items on EBay and netted over $200. That isn’t sustainable forever, but I estimate that I have at least $800 worth of stuff left to sell.

Another book I’ve been reading, Making A Living Without A Job, talks about “The $100 Hour.” The idea is to set aside 1 hour each day to come up with an idea that will net you $100. EBay is one easy way to net $100, and the book gives 18 more ideas. I tried this today, and came up with at least 5 ideas – some of which will be sustainable over a long period of time.

Will I be successful in my quest for $10,000 in just 110 days? Time will tell, but I know for sure that earning $100 a hundred times will be a lot easier than earning $10,000 once.

Cheers,

Ken

Book Review: How to Help Your Husband Make More Money so You Can Be a Stay At Home Mom

Posted on September 8, 2008
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The title is not only long, it is also misleading. A more accurate title would be “How to Drive Your Husband Away Or To an Early Grave So You Can Live Off of Alimony Payments or Life Insurance.”

I found this book by accident while searching for a personal finance book on Amazon. Since I’ve been dabbling with the idea of starting my own business with my wife’s help, I figured this book might be worth looking at. Unfortunately, instead of being a book on how a wife can help her husband, it is more of a manual on how to manipulate him into what she wants him to be. The first give away is the table of contents. For example, Chapter 1 is titled ‘The “Team Work” Decision: Great Ideas Come Before Great Actions.’ The problem is the “decision” the author is talking about isn’t one that a husband and wife have reached together, but one the wife has reached on her own to be a stay at home mom. Here is a passage from chapter 1:

Is your secret (or not so secret) desire to be a stay-at-home mom? If so, you are NOT alone. Many working mothers would prefer to stay home with their children, if their husband’s income alone could support the family.

Gee, if only under-performing husbands would just get off their derrieres and find a better paying jobs, women everywhere could fulfill their desire to stay at home and live off their husbands’ income. Here is another passage:

However, without guidance on how to make enough money to be able to afford to have their wife stay home with the children, and for lack of a better alternative, the situation continues.

In How to Help Your Husband, you will be taken step-by-step through the actions that can give you the life you want, but the decision is up to you.

Maybe husbands aren’t too lazy to get better paying jobs, perhaps they’re just too ignorant! Thank goodness this book is available to wives so they can set their husbands straight. I wonder, though, why the author seems to believe the decision belongs solely to the wife? In my opinion, such a decision should also involve the husband, and in a way more meaningful than being pushed into it by his wife.

The title of Chapter 3 (Knowledge Is Power – And More Money!) sounds good, but it turns out it is really about the husband spending time and energy to gain more knowledge in the hope it will enable him to get a higher paying job to “better” support his wife. In other words, the husband expends the effort, while the wife reaps the reward.

Chapter 4 (Is Your Husband Underpaid?) includes sections to help wives judge whether their husbands are worthy (“Resources on salary surveys”) and interfere with his work relationships (“How to help him negotiate a raise”). In addition, there is a very helpful section (“When it’s time to move on”) to help the wife determine when the husband should quit his present job and find another. My thinking is, What if the husband likes his present job?

I quit reading before Chapter 5 (Networking: A Husband and Wife Activity That Can Get Your Husband a Better Paying Job), but based on the first 4 chapters, it’s probably full of instructions on how the wife can control her husband’s personal and professional relationships. Chapter 7 (Marketing Your Husband) is probably about how the husband is a slob, and what the wife can do about it.

The rest of the chapters continue in the same vein, and I would stop here, except that Chapter 10 (Continue to Grow) deserves extra comment. Continue to Grow… what? By this point in the book, the wife should already have achieved her secret (or not so secret) desire to be a stay at home mom and live off of her husband’s income. Apparently that isn’t enough. The first section of Chapter 10 is titled “How to make sure he keeps that better paying job.” In other words, how to make sure he can continue to support the wife in the manner she’s become accustomed to. My question is, after all this “progress” the wife has “enabled” the husband to achieve, why would this even be a matter of concern? Is it possible that the husband might find he preferred his old, lower paying job and might try to go back to it? Is the author saying the wife’s ability to stay home and not work is more important than the husband’s satisfaction with his job? Is so, then the talk of “Team Work” in the earlier chapters means nothing. Even more offensive to me is the second section of the chapter – “Moving up to the next level.” What, still not happy? At this point, not only does the wife get to stay at home, she’s even possibly convinced her husband to stay at a job he doesn’t like just to maintain a higher income. Now, they (meaning he), need to keep moving “up?” I guess some people are just never satisfied.

Should you buy this book? I think that the decision for a wife to stay at home should be one that involves both spouses. This book seems based on the premise that the wife gets to decide to stay home, and then has the right to manage her husbands career so he can support her in the manner she wants. There are other avenues a couple could pursue if it was decided the wife should stay at home. One would be for the wife to be content with the lifestyle her husband’s current income can support. Another would be for the wife to start a home based business, one she could run herself or with her husband’s assistance. To me, the methods advocated in this book seem like a recipe for divorce, unless the husband actually enjoys being treated as a door mat. I do not recommend this book.

Ken

5 Reasons Garage Sales Don’t Thrill Me

Posted on September 4, 2008
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Many people enjoy holding garage sales, and why not? You get to spend time outside, you can get rid of a lot of clutter, and you can generate a little spending cash. Some people enjoy them so much that they become serial Garage Salers. When I was growing up, the neighbors across the street would shop garage sales for 3 or 4 weeks, then use all the stuff the bought to hold their own. They had at least 5 or 6 garage sales every year.
There are some good tips to follow if you want to run a successful garage sale, and if you’re just doing it for fun, I guess it’s not a bad way to spend a Saturday. However, from the stand points of getting rid of clutter and earning some money, I don’t think a garage sale is a good investment of time. Here are 5 reasons why I think garage sales aren’t really all they’re cracked up to be:

  1. Your market is limited. Every city is different, but where I live, getting 50 – 80 visitors to your garage sale is having a really good day. If you’re hoping to sell all your stuff, that is not a lot of customers, unless you’re selling really cheap or it’s all really desirable stuff.
  2. You don’t have much control over the process. When you do a garage sale, one of the first things you’ll notice is that some people will show up early. Not just a little early, but 5:30 AM early – even if your add specifically states “No Sales Before 8:00 AM” or something like that. I guess you cant blame them, they just want to get first crack at any bargains, but is the extra hassle worth it to you? After the sale, you’ll probably get people coming by late, looking to score something extra cheap that didn’t sell during the advertised sale time. I’ve even had people come knocking on my door on a Sunday morning when the add explicitly stated Saturday Only.
  3. They tie up a lot of your time. I value my time at $20.00 per hour, so for a 5 hour garage sale I’d have to net $100.00 to make it worth my while. If I count the time sorting, pricing, setting up, and cleaning up afterwards, $200.00 is probably more like it, and it’s not likely that I’ll net that much.
  4. Buyers are looking for bargains, not value. Besides having a limited market, most of the customers you do get will be looking for fantastic bargains, not looking to pay a fair price for fair value. For example, an RC airplane that may be worth $50.00 might only sell for $20.00 or less at a garage sale. A lot of stuff just won’t sell at all unless you’re practically giving it away.
  5. They put you at risk of being a crime victim. I hadn’t thought thought of this before, but one of the commentators on the garage sale tips relates an interesting story. The risk might seem small, but by having a garage sale, you’re giving every interested burglar in your area the perfect opportunity to “case” your house.

So are garage sales a waste of time and energy? It depends on you. If you enjoy the social aspects, then holding a garage sale might be worth the time and effort. If you are looking to get rid of a lot of junk and maximize the money you get for it, you might be more satisfied with other alternatives such as Craig’s List or sell it on EBay. As for myself, I can think of ways to spend 5 hours on a Saturday that are a lot more enjoyable and profitable than hosting a garage sale.

Yours, Mine, and Ours, part 2

Posted on August 27, 2008
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In my last post, I talked about the problems caused by a lack of agreement between me and my wife about how much we save and whether personal spending by one requires the approval of the other. When we first started arguing about money, my wife’s solution was to have seperate bank accounts – my paycheck would go into an account to be used for paying our bills, while her check would go into an account to be used for savings and investments.
I was tired of fighting about money so I went along with it, but I didn’t like it for several reasons. First, I felt that since it’s all “family” money, it should go into one family account. Separating our money into different accounts seemed to me like splitting it into “my” money and “her” money. Second, since “my” money was used to pay the bills and “her” money was for savings, it meant that I had no control over the money I earned (it was all going for expenses), while she had total control over the money she earned. Finally, my pay didn’t quite cover our expenses, so every month I would have to ask my wife to transfer some money from “her” account to “my” account. Not only was I having to ask for permission for personal purchases, it felt like I was having to ask permission just to have enough money to pay our bills. I really resented this. I’m not trying to excuse what I did, but this was the reason I started buying things on credit and hiding the purchases from my wife.
Having one account hadn’t worked to my wife’s satisfaction, and having separate accounts was a disaster, emotionally (for me) and financially for us. What is the solution then? We have gone back to one account, but that has brought back arguments about how much we should be saving. I don’t want to go back to each having our own account, because I believe it is completely unfair for one spouse to have final say over almost all discretionary spending. Fortunately, I found a book that has a plan I think will work. Instead of two accounts, we will have three. The first will be a household account, which will include money to pay the bills as well as our savings and retirement plans. Then, we will each have our own private accounts for personal spending. The rule is we each get so much per month for our personal accounts, and neither has any say-so whatsoever on how the other person’s personal moeny is spent. I’ve ran this by my wife, and she’s “thinking about it.” I hope she thinks it’s worth trying, because so far the other ways we’ve tried to deal with our differences over money haven’t worked.

Cheers,
Ken

Yours, Mine, and Ours, part 1

Posted on August 26, 2008
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My wife and I have a fundamental difference of opinion regarding money. My wife’s opinion is that we should spend as little as possible, saving as much as we can (with a twist – money invested doesn’t count as “savings” in her view), and buying extras only when our savings is built up to a level that she is comfortable with. If we have unexpected expenses, discretionary spending should be curtailed until the savings can be built back up.
On the other hand, I have always been a “you can’t take it with you when you go” type of person. I usually had my paycheck spent before the next one came in – too much month left at the end of the money. If I wanted something, I bought it, and if I didn’t have the money I’d just put it on a credit card. As a result, I incurred quite a bit of credit card debt over time.
When I got married, things obviously had to change. I stopped my reckless spending, but kept the debt hidden from my wife – didn’t want her to know what a loser I was. She eventually found out anyway. We got the debt paid off fairly quickly, and things were OK for a few years. It was pretty easy to stop my casual spending because we wanted to save for a new car, which we bought in 2002. After that, we were saving for a house, which we bought in 2003. Then, we built up our savings to about $10,000.
This is when our money problem surfaced again – I felt that since we had a new car (paid for), a house of our own, and $10K in the bank (not counting my retirement plan at work), it was OK to start spending money again on things I like. Not a lot, maybe $100 to $300 per month, and my wife could spend the same amount on herself. This amount of personal spending would still allow us to save something like 10% of our net income each month. My wife felt differently – she thought we should be saving much more of our income, more like around 25% (or more).
Any time I spent money that she felt was unnecessary, she would question me about why I was spending money on myself that rightfully belonged to the family. From her perspective, any money not spent on household bills belonged to the family, and required a family (at least husband and wife) consensus on how it should be spent. I felt (and still feel) that 1. I’m an adult, 2. I work hard for the money I earn, and 3. As long as we are making reasonable contributions towards our savings, we should be able to spend some money individually without having to ask permission or otherwise justify the expense.
Since we were unable to compromise on this issue, I just started buying things I wanted again and putting them on the credit card. I didn’t have the money to pay off the balance every month (my wife would wonder where the money went), so the balance just kept building. (Before you email me to tell me how stupid this was, I already know how stupid I was). Over time, and with some medical bills, interest, etc., it eventually grew to over $17,000. When she found out last October, I thought she was going to divorce me, but she didn’t. We got paid off in only a few months by wiping out our savings and applying my wife’s entire income against the debt. We were also able to build up our savings to almost what it was before.
So, no problem, right? Uhmm, there is still a problem. To make sure I don’t slip back to my old bad habits, I showed my wife how to get online access to all our accounts. There is absolutely no way for me to hide any spending from her. I still believe, though, that I don’t need her permission for every single purchase I make. She still believes differently, to her it is “family money” and can’t be spent without family consensus. So we’re back to having stupid arguments about money – for now. I have an idea to fix it. I’ve run it by my wife, she is thinking it over.

Cheers,
Ken

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