Tag: saving

is college worth it? (part 1)

guinea pig reading a book

Based on a few recent comments on some of my articles about careers (this one, for example), I started wondering about the difference in wealth between college graduates and skilled non-college graduates. A college graduate can usually expect to go into the professional world as a “white-collar” worker, earning substantially more than his non-college graduate peers. However, the college graduate - unless he is very athletically or academically gifted - will probably come out of college with at least some student loan debt. He will probably start earning money several years (4 or more) later than a non-college graduate.

So I decided to do a comparison of the two career paths, and see what those big choices meant for someone later down the road. Specifically I wondered if I could answer a few questions:

  1. Can the late start in saving by the college graduate be overcome through higher salaries?
  2. Does the lower earning potential of a non-college graduate mean that the non-college graduate will be required to “work until they die”?
  3. Who will be able to quit the rat race first?

I made a lot of assumptions and put together a spreadsheet to try to come up with answers to some of these questions. I’ll cover that in part 2. I ignored a few things - I didn’t worry about inflation, for example, since it would affect them both equally. You could argue this is wrong, because inflation moves at different rates in different parts of the country, commuting costs (gas, etc.) might expose one or the other to more inflationary pressures, etc. I skipped that. I also assume that both are highly disciplined savers, always saving 10% of their income and getting decent returns over time. If, of course, both started saving as soon as they start earning and never reduce that amount, they would be in the .000001% of the US population that does so.

My findings were a surprise and weren’t a surprise to me. The main point of the exercise was for me to challenge my own personal context (a concept Robert Kiyosaki talks about a LOT in his book “Retire Young, Retire Rich“). My context is that smart people go to college and get desk jobs. My context is that wealth is created through earning as much as possible. I am trying to challenge my own prejudices about what “building wealth” and “escaping the rat race” actually mean to me. It’s interesting, because I don’t have much exposure to people who don’t subscribe to the “go to college, earn money” credo; but fortunately I’m learning more about the opposite mindset and it’s interesting for me. It’s too late for me to undo my decision to go to college for 7+ years. There were alternatives - I could’ve started a business and educated myself. It’s not too late for me to learn something new.

Stay tuned!

(photo by GirlReporter)

10 Tax Deductions You Don’t Want to Overlook

Millions of Americans overpay on their taxes every year.

Although some of these tax deductions are small, missing too many of them can add up to a lot of money. To make sure that you don’t make a costly mistake that could mean missing out on major savings opportunities, check out these 10 frequently overlooked tax deductions.

Out of Pocket Costs for Charity

While most people already know that they can deduct donations of cash or goods, many are unaware that they can also deduct all of their out-of-pocket expenses when they volunteer. This includes everything from transportation – including mileage, parking fees and tolls – to other travel expenses when away from home, such as meals and hotel stays. It is strongly recommended that you have good documentation to back up these expenses and that you never attempt to deduct an expense unrelated to charity.

Job Hunting

If you are actively seeking a new job, any expenses incurred during the search can be deducted. You are permitted to deduct money spent to send out resumes, including paper, ink and stamps. You can also deduct any internet expenses – such as posting your resume to different job sites – and any travel expenses sustained to and from interviews. It is important to note that you cannot deduct job hunting expenses for your first job.

Moving Expenses to Take a New Job

You can take this deduction even if you do not itemize. As long as your new job is at least 50 miles farther from your old residence than your previous job location was from your prior residence, you are allowed to deduct mileage and the transportation of your household goods to your new location.

Refinancing Points

If you buy a new home or refinance your current mortgage and buy points, you can deduct the cost of the points. If you purchased a home, you can deduct the cost all at once. If you refinanced, however, you have to take the deduction over the course of the loan.

Home Improvement Loan Interest

While most people claim interest on their home loan, many overlook interest paid on a home improvement loan. As long as the loan is intended for a major renovation, you will be able to deduct any interest paid.

Tax Preparation Fees

If you paid to have your taxes prepared or purchased software to complete your taxes, these fees are deductible. You can also deduct any fees associated with e-filing your tax return.

State Sales Tax

All taxpayers have the option to deduct state sales tax. Typically it only makes sense if you are living in a state that has no income tax because you have the option to decide between deducting state and local taxes or state and local sales taxes. For the individuals that live in states that have an income tax it is a no brainer to deduct that instead of the sales tax since it is likely a lot larger. This deduction may not save you a lot, but why pay uncle sam more than you need to.

Student Loan Interest Paid By Parent

If you are a parent and are paying back your child’s student loans, you can deduct the interest you paid, up to $2,500.00.

Transportation for Medical Visits

Many people forget to deduct transportation to and from doctor visits. You can deduct mileage if you take your own car, in addition to parking and tolls. If you take a bus or pay cab fare for transportation, those expenses are also deductible.

Jury Pay Turned Over to an Employer

If your employer paid your full salary while you served jury duty and you turned over your jury duty pay to your employer, you still have to report the jury duty money as income; however, you are allowed to deduct the amount that you turned over to your employer.

Tax laws are complex and constantly changing. It is very common for people pay more in taxes than they have to each year. If you feel you missed a large deduction in the past, consider filing an amended tax return. To file an amended tax return you have three years from the due date of the return that was filed. When filing your taxes, it is a good idea to use tax software or go to an experienced tax preparer to help ensure you take advantage of all the deductions that apply to you.

This guest post was provided by BackTaxesHelp.com, a website that helps taxpayers find the best solution to their tax problems. Visit their site and find more information on IRS levies, tax penalties and more.

how kids (can) make you poor

Raising a child can cost up to $250,000 - and that’s from a study done almost 20 years ago. That’s only the cost through high school - college is another problem entirely, unless you don’t plan on paying for your child’s education (and I don’t). Having a kid is expensive. Having a second is less expensive - hand-me-downs and shared costs can reduce the individual costs - but a larger family is going to cost a fortune. The simple fact is that you won’t become AS rich with kids.

I’ve seen the question of children play out a dozen different ways with friends and in my own life. My parents had kids (my brother and me) when they were barely out of their teenage years. I have friends who waited until they were almost 40 to have kids. One couple fervently and frequently insisted they would never have kids - and show no signs of changing their minds. In each case, the decision to have a child (or children) was deeply personal, and made for a number of reasons - but seldom considering the cost. The simple fact is that you’ll be better off financially without kids. Kids are expensive.

It’s a potentially sensitive topic … and most people don’t want to have that conversation. “Kids bring so much joy into your life!” “Kids are their own reward!” I’m biased - the cliches are all true. My son’s a supernova of energy, creative and amazingly verbal. My daughter’s charming and almost impossibly cheerful. They are joys. But to be realistic, I have to admit that because of them I will not be as wealthy as I could have been. I regret nothing, but I also understand that I’m going to have to work harder accumulating wealth than I would have without children.

So how do we plan to compensate? If you have kids, how can you avoid spending more than you need to? It’s not the nature of my blog to talk about ways to save money on Cheerios by buying the store brand - although you should. But I do have a few “big ideas”:

  1. I’m not paying for my kid’s PRIVATE college education. If Little Buddy or Pumpkin want to attend a private school, they’d better develop tennis skills or become world-class scholars. I’m not paying for Pumpkin to attend an Ivy. I’ll help, but if they can’t pay for a private college, they can go to a public university, just like Mama and Papa did. We did just fine.
  2. We will readjust our lives around their education early on, though. We moved to Florida to escape crappy public schools in Jersey, and made sure we landed in a school district considered one of the best in the state.
  3. I will strive to teach independence. This sounds stupid, but I have seen so many of my colleagues in corporate America talking about their mid-20 (or even mid-30) year old children living at home. I know I can talk big now, but I left home at 18 and my children will too. If they can’t afford a home, I’ll tell them to move to a cheaper locale. An unmarried 35-year-old living with their parents needs to experience life.
  4. We will resist consumerism. A couple of years ago, one of my neighbors bought one of those big car-battery powered cars - with a working FM radio - for their daughters. Little Buddy loved it. I was tempted to get him one. He didn’t, and doesn’t, need it. I have fallen victim again and again to the urge to buy toys. Sometimes it makes sense: I bought him a farm set that he plays with daily. Sometimes I fail: I have bought a half dozen balls (football, baseball, soccer) and he is utterly indifferent to all of them that don’t have Spiderman on them. But I see a sickness in most parents around me: the need to buy distractions. I struggle to remind myself that learning to pretend my wooden blocks were race cars taught me to IMAGINE things. My parents would have done me a disservice by buying me Leapfrog, or whatever the 70s equivalent was. Learning how to live with less - at least as far as toys - is a gift, not a burden.

But none of these cost-saving ideas can compensate for the fact that a childless couple (or a single person) will simply be much better off than a couple with kids. I won’t recommend one choice or the other, because it’s such a personal choice. But don’t let anyone tell you otherwise: in the short term, having kids is no big deal. You can afford formula, diapers, baby clothes. But in the long run, having kids will change your career choices, affect your ability to save and limit your choices about almost everything. Make sure you’re comfortable with the long-term cost before you take the leap.

personal mission statement, and links

I’ve been trying apply the Pareto Principle (discussed ad nauseum elsewhere) to my daily activities a bit - trying to focus on important things and let stuff that I might enjoy but don’t really advance my life goals go. It’s harder than you think: I like reading about sports and spending time tinkering with this blog, but neither activity moves me anywhere closer to where I want to go with my life. I did do one activity that was quite helpful: I am trying to use Stephen Covey’s suggestion, from The 7 Habits of Highly Effective People, to write a personal mission statement. It’s one of those typical self-help type things that sound somewhat goofy but it’s a surprisingly difficult exercise. I’m trying to limit it to about three lines and you can get a definite idea of where your values are when you’re forced to narrow down your personal priorities - which can encompass your family, friends, work, beliefs, and so on - down to about 2-3 sentences. Not that easy.

On to the links:

3 Reasons Why Most People Will Never Earn More Money — And What You Can Do About It!: It’s a good point, and frankly one that I have been guilty of: I spend more time explaining why I can’t than trying to do it. I could make more than I do, but I don’t.

What Will Retirement Look Like for Younger Generations?: It’s a depressing thought. The future of retirement in the US is bleak. If anyone tells you otherwise, they are kidding themselves. Even in the public sector, things are looking worse. In the private sector? Forget about it. Tell me how you can retire at a reasonable age if you’re a middle-of-the-road wage earner in America and I’ll tell you how I can sell you a lovely bridge in Brooklyn.

Pay Off Your Mortgage vs Pay Down Your Mortgage: One of the huge questions in personal finance: I’ve always thought that it was stupid to pay off one’s mortgage (because it locks up your money) but now? Not so sure.

Sucked Back into Obsessive Couponing: Saving money is bad. No, really. No, really…it’s not. I wish I did it more than I do.

Should Unemployment Benefits Be Extended?: Listen, there has to be a limit. One year, maybe. I pushed seven months, myself, and had to relocate halfway across American to find a new job (admittedly by choice of a new locale). But I have never felt guilty about getting that money - don’t forget, it’s money paid INTO the system as “insurance” - your unemployment benefits are benefits being paid back to you because you paid that money into a fund for unemployment benefits. No shame it drawing on that account….

Lending Club Loan Investment Update: Lending Club has been a great investment for me and I may put more in soon; peer-to-peer lending is still a good way to diversify past Wall Street.
Are You a To-Do List Bottom-Feeder?: I am. I let small things keep me from big things all. the. time. It kills me that I recognize this and can’t correct it.

And more…

making time for the details

A couple of years ago my car’s air conditioner had some problems and stopped working. To be more exact, the fan quit working except on the 5 (high) setting. I could have the A/C off, or blowing like a hurricane. I didn’t think about it too much - or rather I did, but decided I was far too busy to attend to a problem like this.

Some other things broke down a few months later and I decided to take the car in for an overhaul. The mechanics were mystified by the fan problem, and ended up keeping the car for an extra day. When I picked it up, I found out that a non-standard part had been substituted at some point in the car’s repair history and the result had been that the fan had shorted out not only itself, but a lot of the wiring in my ignition. I didn’t follow all of the technical details, but the mechanic summed it up this way: “you were lucky the steering column didn’t burst into flame when you turned the car on.” I let out a “whew” and decided that in the future I would try not to let “little” repairs go too long without checking them out.

The same is true for most aspects of your life. Think about all the areas where you need to check out the “little things” to make sure the “big problems” aren’t lurking:

  1. Your health. Going to a doctor once a year is a must, but if you’re lucky enough to have insurance, that insurance probably also covers vision, dermatology, podiatry, etc. Make an effort to work visits to specialists in occasionally to make sure that no problems are lurking (for example, getting a glaucoma test once a year from an optometrist or checking out that new mole that might be the warning sign for skin cancer).
  2. Your financial future. Check on your insurance policies and your will. I am up-to-date on insurance, but Bubelah and I still don’t have a will. I wonder how I can really offer much financial advice when I haven’t gotten that one piece of critical financial planning done myself, but do as I say, not as I do in this case. Put money away in savings somewhere. Don’t waste too much time worrying about Roth IRAs versus 401(k)s, for example - just start doing it.
  3. Your family future. Make sure you check on the little things with your family. Understand what’s going wrong with your relatives, your spouse or your kids before it becomes a bigger issue. This could be health, school, social life, finances, etc. Anyone you feel responsible for needs a “checkup” from you once in a while.
  4. Your home. If you own, making sure your home is in good shape is no small exercise. From alarm systems to air systems maintenance to just checking out the drafty places around the window, fixing little problems now can prevent big problems tomorrow.
  5. Your political future. I know people get more excited about presidential politics in America, but let’s face it - your Senators and Representatives (both federal and state) and even your local officials have more day-to-day influence on your life than the President does. I know worrying about who gets elected to the state senate isn’t as “big a deal” as presidential politics, but it matters. The people who sit on your local school board probably have more influence over your daily life than you imagine, even if you don’t have kids.
  6. Your life, the universe and everything. Little things that bother you today can become a bigger problem tomorrow. If you’re unhappy about something today, don’t let it fester. Even if you can’t fix it today, take one tiny step toward correcting it.

I am often more worried about the long-term, big-picture issues and grand questions about life and history and whether the Jets will win a Super Bowl in my lifetime, but little things like avoiding a fiery steering wheel column through dumb luck remind me that I need to pay attention to the details in life, too. Don’t wait until the little problems become big problems; I don’t know of many problems that disappear on their own.

photo credit: swambo

<a href=”http://www.bripblap.com/what-is-better-from-a-tax-perspective-a-roth-ira-or-a-401k/”>What Is Better from a Tax Perspective: A Roth IRA or a 401k?</a>

doesn’t anyone have a job, and links

One of the things that amazes me when I’m between projects is the sheer number of people out and about during the day. If you go to Costco or Bloom (a grocery store) during the day, there are a lot of people there. There are cars on the road. There are people out and about all day long, and I always wonder - are these people who don’t work, or who work irregular hours, or who work at home? How can there be so many people out and about from 9 to 5? I don’t mind, I’m just curious.

On to the links:

My New Career: Stealing Cars in Oakland: Fun signs of the decline of the American empire…

Amazon Prime 1 Year Free for Students and Others: Amazon Prime is a great deal - I’ve been a subscriber to the plan for the last 5 years. It all depends on the volume of your orders from amazon, of course, but if you order more than a few orders a year it’s a good deal.

Our Credit Card Rewards Surprises: As far as I’m concerned, the American Express Blue cash rewards card is the best card out there - we put almost all of our household expenses on that card.

The Joy—and Value Received—of Community College: Let me start by saying I know nothing about community colleges. I didn’t ever go to one, knew few who did and don’t pay any attention to them. All that having been said, I love the idea of community colleges and wish they were better promoted. Many professions - my own, accounting/auditing included - could probably be just as well served by community college grads as by four-year college grads. Why we don’t promote these institutions more is beyond me.

The Siren’s Call of Passive Income: An interesting take on the ethical implications of “passive income.”

It Doesn’t Matter What Your Position Is Right Now, You Can Do Better: Great advice: “What can you do, right now, to start improving your situation? That’s the only question that matters. ” Quite true.

Networking Tips to Help You Find a Job: “Make sure to follow through. If someone provides you with a referral, make sure that you follow through quickly.” This is a small thing, but it’s one of the least-followed pieces of advice in the job-seeking world. I’m not nearly as good as I’d like to be at following up; but I’m better than many people are. Don’t offer to follow through if you won’t. And if you offer, and DO follow through - people WILL appreciate it.

The preservation of wealth: “In fact, I doubt there’s a rich person in the world getting by with an index tracker, a savings account, and a wodge of Government bonds.” Probably true. I’m convinced that index funds, savings, etc. are the mark of a small, non-rich mind. That having been said, they are also the mark of an educated, non-poor mind. There’s a big gray area between rich and poor that can be quite comfortable for many of us.

99 thoughts on losing 100 pounds: Hey, that sounds familiar… hah.

And more:

Finances are Fun: 5 Ways to Encourage Your Child to Embrace the Spirit of Enterprise

We live in a capitalistic society. Many say this with a sigh and a shake of the head, but there are some upsides that shouldn’t be overlooked. If you start early enough, it is possible to rise to unfathomable heights of success. Unfortunately, it’s also possible to destroy your credit and your life quite early in the game by not having a clear conception of how to manage your finances.

kids in belfast

American young adults and children are notorious for their lack of financial know-how. In a society that practically forces you to get a credit card when you turn 18, this ignorance can be deadly. Here are five ways to teach your children how to excel in a competitive economy and to avoid the pitfalls along the way.

1. Teach the idea of financial self reliance early on.

There are times when everyone could use a helping hand, and there’s nothing wrong with that. With that said, there’s nothing wrong with teaching self reliance as a preferred choice. From a very young age, help your child differentiate between needs and wants. If the thing they’re asking for constitutes a “want”— assuming you can/will give it to them in the first place— set up a system where they can work to earn it. Even if “working for it” only means doing extra chores for a couple days, they’ve learned that work is necessary and beneficial.

2. Learning about compound interest is crucial.

When your child first learns about interest, start to talk to them about credit. Explain the pitfalls of taking out too much debt. At the same time, open up discussions concerning investment. Show them the potential for making money if they invest early in life. Compound interest can work for you, or against you. Teenagers are more likely to be interested in these discussions than younger children, so keep the conversations age-relevant.

3. Teach them about other financial perspectives.

Every society and individual family has a unique financial policy. Discussing other viewpoints allows your child to pinpoint the crucial financial questions that any functional philosophy seeks to answer. Here are some examples:

“Is private property a good thing?”
“Should we allow extreme divisions of wealth?”
“How much influence should governments/companies/individuals have in making financial policy.”

Accept that you might not agree with their answers. Keep any debate friendly and informative.

4. Encourage early attempts to start businesses.

When I was 8 years old, I started a business selling golf balls and cans of soda on the golf course next to my house. These early experiences taught me the basics of running a business. This knowledge was carried into my adult life, and inspired me to become a freelance writer.

You never know how far a child’s chosen small business will take them. A close friend in high schools started a lawn-mowing business. By the time he was 18 and had graduated high school, he was able to sell the business for 500K. Now, he manages a department of 100 people in a Fortune 500 company.

5. Allow your child to enjoy the fruits of their financial success, and, if applicable, controlled financial failure.

Saving for college is important, but don’t’ demand that your child put every penny they earn from a high school job into a savings account. Help them save a certain percentage, and allow them to spend the rest how they see fit. Never feeling rewarded for your work can foster an attitude of futility.

Finally, allow them to make manageable financial mistakes. If they don’t save ahead-of-time for a desired item, it’s “ok” to allow them to go without the item. Now is the time to make small mistakes so that larger, life altering, mistakes won’t be made down the line.

Bio: Alexis Bonari is a freelance writer and blog junkie. She is currently a resident blogger at onlinedegrees.org, researching areas of accredited online degrees. In her spare time, she enjoys square-foot gardening, swimming, and avoiding her laptop.

Photo by larbelaitz

dea(ovzo1!DD

once more into the breach, and links

King Henry V:

Once more unto the breach, dear friends, once more;
Or close the wall up with our English dead.
In peace there’s nothing so becomes a man
As modest stillness and humility:
But when the blast of war blows in our ears,
Then imitate the action of the tiger;
Stiffen the sinews, summon up the blood,
Disguise fair nature with hard-favour’d rage;
Then lend the eye a terrible aspect;
Let pry through the portage of the head
Like the brass cannon; let the brow o’erwhelm it
As fearfully as doth a galled rock
O’erhang and jutty his confounded base,
Swill’d with the wild and wasteful ocean….

Read the rest.

One of my favorite poems/sonnets/monologues/sayings/etc., right along with “Kill them all, God knows His own“, “”I pray thee, then, Write me as one that loves his fellow men“, “anyone lived in a pretty how town” and “Annabel Lee“. I bet you weren’t planning to get a list of Steve’s top five poetry/quotes selections, were you? Oh, and I’ll throw in almost everything this dude said, too.

Once more, I’m off into between-contract land; my current contract is ending and no new one is in sight. Thankfully I have my go-to-hell fund ready and no panic whatsoever on the horizon. I’ll work more on self-employment and blog monetization, and see what comes next, without fear. It’s a better feeling than being laid off while living paycheck-to-paycheck, I bet.

You Can Be Rich Without Being Smart: Amen. This is something that’s not discussed often enough. I know a lot of smart middle class people and a lot of less-than-smart upper class people. It’s neither good nor bad - there’s no harm in being middle class - but book smarts are completely and utterly unrelated to “wealth smarts.” Far too many book smart types - like me - become risk-averse and complacent based on the idea that employment in a highly skilled position is “success.” Let me tell you - it’s not. Success is doing something you want to do, not just having the brains to do something you hate (but are good at doing).

The much maligned Robert Kiyosaki: Amen. Here’s the best quote, as far as I’m concerned: “His book – at the time – inspired me to look into the field of personal finance a LOT further.” I couldn’t agree more. He spouts a lot of junk, but his statements (like “a house is not an asset”) really struck a chord in me and made me think a LOT more about personal finance. Take everything he says with a grain of salt, but he will make you think…without a doubt.

Increasing Penalties for Health Savings Accounts: An interesting series, especially since I’m making the transition to an HSA account for my family.

Financial Challenges for the Class of 2010: I am very, very grateful I’m not a grad. Good luck to the 2010 grads, but man… the times they are a-changin’… and not for the better.

Watson Inc: Millionaires Make a Return To Boom Levels: Eliminate Consumer Debt and Build Wealth: Some interesting stats here. Rich (or rather, I should say “wealthy”, since that conveys a mindset/lifestyle rather than a purely numeric status) people make money even in “down” times.

8 Critical Steps Every Family Should Be Taking to Prepare for the Next Financial Crisis: There will be another financial crisis. The US is not in any way, shape or form situated for the rapid growth so many of us grew to know and love in the 90s and mid-oughts. Maybe there will be another bubble, but next time there won’t be as much money for a “stimulus” package. The money is running out. Inevitably, there will be a stopping point for Citi and AIG and all the other boondoggle spending.

Caretaking As a Career Option – What’s In It For You?: Huh. Well, not a career path I knew much about - it sounds interesting.

Live Sports: One More Reason to Get Rid of Cable: Er…not quite. The day the NFL shows up on Roku, though, I’ll be fairly close to killing my cable subscription.

Why It’s Frugal to Live in Colorado: I’ve never been there, which is weird to me. I’ve been to Siberia, Kuala Lumpur, Indonesia, the back country of Romania, etc. - and never to Colorado. I’d like to go, though - I have seldom heard anything but good about it.

And a few more:

And of course, the greatest poem of all time (except, possibly, this one):

OZYMANDIAS

I met a traveller from an antique land
Who said: Two vast and trunkless legs of stone
Stand in the desert. Near them, on the sand,
Half sunk, a shattered visage lies, whose frown
And wrinkled lip, and sneer of cold command
Tell that its sculptor well those passions read
Which yet survive, stamped on these lifeless things,
The hand that mocked them and the heart that fed.
And on the pedestal these words appear:
“My name is Ozymandias, king of kings:
Look on my works, ye Mighty, and despair!”
Nothing beside remains. Round the decay
Of that colossal wreck, boundless and bare
The lone and level sands stretch far away.

Poetry started and stopped for me with that poem. Amazing. For the most part poetry and Shakespeare and the lot bore me, but once in a while, when I’m in a reflective mood, it blows me away.

the iPhone sickness (2010 and counting)

$599 to $399, 68 days after product launch. Remember that, back in 2007? I wrote most of this post back in 2007 when the iPhone first came out, and found that much of what I wrote is still true today. Here it is:
the iPhone, circa 1986
It was bound to happen. Like a million consumer electronic devices before it, Apple dropped iPhone prices from $600 to $400 68 days after product launch. Angry first-adopters screamed about refunds (and got one). Breathless wait-and-see types are now vibrating with barely repressed joy at the thought of claiming one of these ‘bargains.’

I am no fan of Apple. I know there is a cult behind Apple but some of the frenzy behind iTunes, the iPhone, the iPod and the Mac has always eluded me. I get the general principle. They look nice and they do their stuff with flair and they aren’t Microsoft. But let’s face it - if I told you I had a great car that wasn’t susceptible to typical car problems, and looked really cool, but at the same time used a different kind of gasoline that wasn’t widely available, needed car parts that only one manufacturer produced and cost twice as much (or several multiples as much) as your current car, would you be in a hurry to upgrade? Since 99% of my computer time is now online, it’s hard for me to understand why I would want to pay a premium (and suffer so much incompatibility) for an Apple. I am sure someone reading this on an Apple will have a good argument why Safari browsers are better than Firefox or Chrome… ?

But when I had to really stop and wonder was when a $600 phone became a source of such consumer bloodlust. Is this what America has come to? $600 phones? Are there that many people out there with that kind of money to spend on phones? That’s a rhetorical question, since I know that many people will buy an iPhone while ignoring their upcoming credit card payment or saving for retirement. But just stop and think about that statement: something you can get for free like a cell phone is being sold for $600 because it adds functionality so you can play YouTube videos from lonelygirl15 on a one-inch screen!

The concept of something-for-nothing that comes out of offering an after-the-fact refund for a price change when none was implied in the sale is terribly annoying to me. Should I get a break on my house if the prices in the neighborhood don’t go up as fast as they did the year I bought the house? Should I be able to go back to Pathmark and ask for $1 off a carton of milk if they offer a sale the day after I bought it?

Of course I can ask. That’s my right as a consumer. I am willing to bet more stores would consider whether it was worth their trouble. I remember buying a video-editing device from amazon and seeing a rebate offered before it even shipped that wasn’t available at my time of purchase. In that case, Amazon acted quickly to grant the rebate when I pointed it out, because it was a matter of hours. I just don’t understand why Apple felt a need to cave in to demands for refunds 2 months later. You can’t convince me that your average Apple first-adopter isn’t going to rush out and buy an itouch or an iToaster the second it’s offered, no matter how many times they get screwed. Apple should have said hey, $200 is your instant gratification premium! This is your premium for being among the touched - the divine - the ubercool!

It’s this kind of consumer mentality that leads almost directly into consumer debt. I can whip out a credit card and buy something now for $400 but pay $200 on it in interest because I don’t have the cash on hand to pay for it. Or, I can wait 2 months and pay $400 in cash. I know that this seems obvious to most of the people who read personal finance blogs, but I think a large segment of America just doesn’t get it. At all.

I have learned that you have to stop and think before you buy stuff. I have also learned that rushing out to buy stuff is a good way to retire poor. The iPhone and the iPod and so many of Apple’s products have become so trendy and so cool I continue to wonder when a backlash will come and they will become uncool, and people will realize that there is no need to pay a premium simply based on design. I suppose it will happen when someone else comes up with a neater, cooler product and not before, rather than when the American consumer suddenly realizes Apple - like a million other “brands” - is giggling all the way to the bank.

the sick, and links

Here’s a quandry. Since we’ve moved to Florida, almost exactly a year ago, my family’s been sick. A lot. Allergies, infections, miscellaneous bugs - it has gone on and on. My son got sick last week, then just as he recovered my daughter went down - hard - with the same bug, throwing up and feverish for a few days. Just as she calmed down, I woke up in the morning with pinkeye (conjunctivitis) and Bubelah came down with an ear infection (and both of us had the same cold our kids had).

Now you could argue that it’s simply the difficulties of having a small child in preschool (Little Buddy) or maybe I have sickly work colleagues, or maybe it’s just bad luck. It’s infuriating not knowing, of course, because if I knew that our family was simply allergic to the plants of the climate or otherwise poorly dispositioned to the region I might be thinking of moving on.

On the other hand, we love the area, the schools and the climate (hot, but cool and breezy on the beaches). So it’s an annoying development to be sick more times in the past year than I’ve been in the past five in New Jersey.

Link it up:

Don’t Be A Sucker: Why Private Schools Are Financial Rip Offs: Said it before and I’ll say it again - the gains to be made from going to a private school don’t offset the loss of cash. Unless your kid is studying to be a musical genius or something, it’s a waste.

6 Easy Ways to Save Money without a Budget: I don’t budget (although perhaps I should) and the main point is simply to be aware of your spending.

Are You Ready For A Social Security System Overhaul?: Dreading, but ready. I don’t think any reasonably sober person expects Social Security to remain unchanged long-term. Something will change. My hope is simply that I’ll get something out of it - anything, really - before it disappears. I’m not an alarmist (and I think most politicians are) but based on the way the system’s built it’s hard to see us surviving the Generation With The Greatest Opinion Of Themselves - aka the Boomers - without some changes.

Health Care Bill Impacts: Insurance Options for Young Adults, and related Health Savings Account (HSA) Basics: Health care’s just going to be a continuing pile of bureaucratic horrors in our country. I’m a fiscal conservative in many ways, but not in this one: single-payer government-provided health care (or a slightly modified version) is the way that every single other modern democracy has chosen to go. The US is bringing up the rear in this debate.

Are You Celebrating the Sex and the City Movie?: Does the sun rise in the west? I’ve complained for years that these characters are hideous people with awful behavior and almost psychotic obsessions with superficialities. I would be embarrassed for any of them to be my friend.

And a few more…

the world cup and links

As I post this, the World Cup is kicking off. My once-every-four-years interest in soccer will briefly flare up, and I’ll pay attention for a week or two, then forget about it, then get excited about it towards the end. Or maybe not. It’s hard to get too excited about it, but I do realize it’s probably the biggest sporting event in the world. And one of my links is related: Money and the World Cup

On to the links:

Are You Cut Out for a Freelance Job? Is Anyone?: I thought this was a very interesting expansion on my post, “Job Junkie.” I left a couple of lengthy comments…

How to Stockpile Food for Survival: I guess as westerners we never think of a time when we might not be able to readily obtain calories, but I suppose that Katrina should have taught us that natural disasters can occur. I have this on my permanent to-do list, though, and have yet to take any action on it.

Should The U.S. Banking Industry Be Regulated? Thoughts On Financial Reform: I won’t get into details, but count me as someone who’s opposed to the current reforms being proposed. They don’t go far enough and everyone’s going to walk around patting themselves on the back if they are enacted, and we’ll forget about it. It’s not going to work. There are still far too many institutions that are “too big to fail” and their risk-taking activities will be far worse than ever before - because now the precedent’s been established.

Drive-in Theaters – A Money-Saving Movie Experience: I haven’t seen one of these in years, and I can’t see how any survive except as complete and utter novelties, but I guess they do.

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