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Archive for March, 2013

Easter and Passover

March 31st, 2013 at 04:16 am

If you think religion is a fairy tale of imaginary sky friends, you should probably skip this post.

No matter one's religion, I think this time of year is ideal for a "Springtime Thanksgiving." Whether you believe G-d passed over the true believers in preparation for their deliverance from Pharaoh or that Christ was risen and cleansed us of our sins, I think this particular time of year is a good time to assess where you are in your life and give thanks where they are deserved.

I'm truly blessed by a loving family, good health, a good job, and a good life. Thanks, God. I couldn't have done anything without Your help. I'm doing "better than I deserve."

If you're interested in languages, you might find it interesting that Pasqua (Italian for Easter) and Pesach (Hebrew name for Passover) are derived from the same root. Yet the two words commemorate totally different events, unless you want to speculate that deliverance from Pharaoh and deliverance from sin are somehow the same lesson in different forms.

If only Burt Reynolds hadn't done that movie, we might be able to have a common holiday called "Deliverance."

Cue the Banjo music.

Money, Debt, and Credit

March 23rd, 2013 at 03:49 am

CreditCardFree posted an article about her friend spending her tax return on unnecessary items.



http://creditcardfree.savingadvice.com/2013/03/22/backwards-...

This got me thinking about how I used to view things. I started to reply in the comments, but my "reply" turned in to a longer post than CCF's original musings. That, in turn, spawned this post.

In the US, and probably much of the developed world, "available credit" has become synonymous with "money." Think about how you were before you devoted yourself to paying down your debt: As long as you were still below your credit limit, you could afford to buy something.

Did you not think "I still have room left on my credit card, so I can afford this?"

From this revelation, I realized that "available credit" has become conflated with "money." If you thought that the two were the same thing, then there would be absolutely no reason to pay off debt with your tax return. Follow the reasoning in the next paragraph.

I have a $3000 tax return. I have a $12000 balance due on my $20000-limit credit card. Therefore, I have spending power of $11K. If I pay off my debt with my tax return, I have $0 in cash, and $9K due on my $20K balance. Therefore, I have "spent" my tax return for no gains in my ability to buy things. Therefore, I have "wasted" my tax return for nothing.

How many of you had thought processes similar to the preceding paragraph? You may not have thought it through quite so logically (self-anointed nerd, here), but does it not encapsulate how you actually thought about money and credit? They're the same thing in the minds of those who have not had the epiphany that "debt is bad" that most of us writing in the blogs on SA have had.

And this is why most folks don't understand us, and most folks are not paying off debt, and why most folks are going to panic again when the next downturn happens.

Money does not equal available credit. If you realize the wisdom in referring to them as "debt cards" instead of "credit cards," then you understand why we're paying off our debts. Maybe we should all start calling them "debt cards" instead of "credit cards" when we talk to others. Maybe we can start a trend that has a positive effect.

More likely, though, we'll get talked about behind our backs for not knowing the "right" words for those plastic swipe things.

Home Improvements and Spreadsheets

March 22nd, 2013 at 09:06 am

I'm a spreadsheet nerd. When I make an important financial decision, the first thing I do is break out Excel and start to do comparisons and "what-if" checks.

My house in the US is up another $20K in value in the last two months by the online estimators and my own research into the neighborhood sales online confirms these figures. Also, its apparent rental value is up $200 per month. I already had a spreadsheet for the "sell or rent, which is better" scenario, and put the new numbers in it. As usual, when all factors are considered, there is only a $50 per month differential between renting out the place and selling it and investing the profits. I use a conservative 7% for my investment return calculations.

I opened a new sheet in the workbook and listed my electric, gas, and water usage from figures I could find online in my accounts. I've been making energy efficiency improvements to the house nearly every year since purchasing it. Honestly, I have pretty much run out of improvements to make. The house is in Houston, TX. I've added ridge and soffit vents. I've added a radiant barrier. I've upped the ceiling insulation to absurd depths. I've put in wall insulation as the bungalow was built around 1950 and no one used insulation back then. I have high efficiency everything including washer, refrigerator, air conditioner. I have double-pane, e-squared, argon-filled windows. I have one sliding glass door left to replace with some French doors, and my upgrades will be complete.

As I said, this was all done over a course of years. I finally got around to working out my total energy and utility usage for the place. I had paid as much as $400 for only the electric bill one month, though usually the electricity ran closer to $300 or slightly below during the summer months.

My spreadsheet did not disappoint me. My maximum TOTAL utility bill for the last two years was right at $170. That was only one month during the drought where my water usage was over $100. I told DW while we were doing the watering that "it's cheaper to water than it is to put in a new lawn."

My electricity provider went out of business, so I lost previous billing data, and cannot go back any further. The house is costing about $110 per month for total utilities: gas, electric and water. That's $200 per month right into my pocket when I move back. Right now, DD2 is enjoying this bounty with her husband as they house-sit while I'm overseas.

Since I started doing the upgrades, I have probably invested just about $30K in the changes. That means it is a 9 year payback at 7% per annum. I'm a good five years into the payback period.

Those improvements are as good as money in the bank, in a few more years.

Free eBook for One Week

March 18th, 2013 at 10:59 pm

I posted in the freebies section, but more people probably read here, so I'm double-posting this.



The DaVinci Code, by Dan Brown, is being offered free by the publisher to promote Dan Brown's newest book. If you have any kind of eReader (I use Kindle on my iPad and iPhone), then you can get it free from your favorite publisher.

I got my copy from Amazon. I had to go down the list to find the $0.00 Kindle edition, but it was there. I would assume GoogleBooks, iTunes, Barnes&Noble also have free editions, according to the press reports.

The offer ends on 24 March, so if you want a free copy of the DaVinci Code, now is your chance.

Ouch!

March 17th, 2013 at 09:00 pm

I went to the doctor today. About 10 days ago, I went and found out I have bone spurs and plantar fascitis in both feet. Ten days of pills and creams basically did nothing for the early-morning pain.

The doctor gave me steroid shots, one in each heel. Now you know the reason for the title. Steroid shots directly into your heel are the reason curse words were invented. I didn't do any more than scream, but I can assure you I was THINKING curse words as I did so.

So now, 12 hours later, I'm sitting up in the middle of the night in intense pain. The nausea and general body aches I got after the shots were bad enough. I cannot even walk now. When I say pain, I'm mean so bad I cannot even comfortably move from the couch.

This had better work. The doctor said that in extreme cases, three shots would be required, each 10 days apart. This had better work!

Take That, Washington!

March 16th, 2013 at 03:34 am

Well, at least this year living in Dubai worked out. I just finished my taxes, and I owe a whopping ZERO dollars.

Plus, I'm getting a refund. I usually don't take my refund, and leave it in for next year's taxes, so this year, the tax package I used didn't give me that option hence the fact my last year's "leave it in" option is now this year's "get it back" requirement.

I realize that leaving my "refund" with the IRS means the government gets my money tax-free, but they need it worse than I do, and I prefer to have a bit more buffer at tax time than most people. Besides, it's their money anyway. Just ask them.

Next year, I'm going to have to pay quite a bit in quarterly payments, which is a bit daunting for me. The way my pay is structured worked out for me this year. Next year (2013 taxes) is going to hit very hard. I hope they don't make too many changes at the last minute (sequester and end-of-year changes like 2012, anyone?) since the quarterly estimates are going to be hard enough to figure out without last minute changes.

There goes the Budget!

March 14th, 2013 at 08:27 pm

I got a call from DS a few days ago. He has decided to marry his (now) fiancee. They've been dating about three years. She graduates in May. They're getting married in June. At least they waited until after college to get married. DS has been out of Uni about three years, so he's just now hitting his stride on earning potential.



The problem is that we had not planned to come back to the US until July or August. Two months isn't a lot of time to change our plans, and we have promised to "help out" on the wedding. How much we help will probably depend a lot on how well DS is doing with his income. If he's making wise choices, we'll help more. If he's not making wise choices, we'll help less. We really can't make that decision from a distance.

DW and I are thinking of giving the new couple a gift of enrollment in Dave Ramsey's class. I don't really agree with 100% of DR's teachings, but you can't argue with success. I am about 99% sure DS has put himself in over his head in debt, due in large part to my past performance which he witnessed. It's never too early for him to start to think about retirement. There's no way to plan for retirement while "improving" your credit score.

Anyway, this is only a bump in the mortgage-pay-off road. If we get my bonus on time, then we should be able to overcome any difficulties that this wedding will cause with our budget. If we don't get the bonus on time (you'd have to know our CFO to understand why this is a possibility), then the timing of the wedding will hurt. DW and I have decided to slow down the mortgage pay off and concentrate on vacation/wedding savings instead.

I am certainly blessed to be saddled with the "good" problems I'm now facing. Of course, I've worked for over 30 years to get this overnight success. God's been smiling at me recently, and I'm really thankful for His help. (I apologize to those of you that might find this last statement offensive; however, I am obliged to acknowledge Him in my current situation.)

Death and Money

March 11th, 2013 at 01:41 am

Sorry for yet another long post.

I have lived a very charmed life. My parents are in their 70's and are still alive, as are all of my brothers. Very few people who are or were close to me have died. Due to this, death is still very foreign to my experience, and any deaths that have occurred have left a profound impact on me.

In other posts, I've alluded to losing my girlfriend of many years when talking about my retail therapy binge. A recent thread in the forums (actually, I think the word is "fora," but no one uses it, so I won't either) got me to thinking about my outlook when it comes to money, which brought me to write this post.

My father came from a very large family. He had five brothers and two sisters. Most of them are still alive and in their 70's and 80's. When I was about eleven, my father's father (my paternal grandfather) passed away. The family all gathered at his small house and had the near-reunion that always accompanies the death of a family patriarch or matriarch.

With that many children in their 30's and 40's, and all of their children (my cousins), you can imagine the scores of people in my grandparents' house. I would say the house was about 1000 square feet, and two bedrooms with only one bathroom and one common area plus a kitchen. All of us kids were basically left to our own devices. The older teens wandered off to the local hangouts - there was a park nearby where they could go sit on the play ground equipment and smoke cigarettes unbeknownst to the adults back at the house - while us younger kids pretty much just hung around the house and probably made pests of ourselves until we were given something to occupy our time.

My cousin Roger and I were eventually dispatched to my grandfather's bedroom. We were given the task of clearing out his dresser. Roger was about a year younger than I was, and his father and mine were the two sons who had made decent livings for themselves. My father's family was not rich by any means, my grandfather being a retired police officer from the 1950's when pensions were small but sufficient; however, my father had put himself through university to get a BS and eventually an MBA, and my Roger's father had opened his own successful business. The other aunts and uncles, though, were basically living paycheck-to-paycheck like most Americans still are doing today.

While clearing out the drawers, Roger and I came across my grandfather's old service revolver. We were southern boys, so we knew about guns and merely set it safely aside with the other items we were cataloging. We also came across a "blackjack." I asked my father about it when we told him about the revolver (which my father put out of the reach of our younger cousins). A blackjack is a leather device that looks much like a very small dumbbell, and has a small weight made of lead - maybe a fishing lure weight - at either end of the "dumbbell." The wielder holds one piece of leather-covered lead, and swings the blackjack as a small club. The leather and the weight of the lead increasing the force of the subsequent impact. A blackjack is a close cousin of "brass knuckles." My father explained that my grandfather had disarmed the blackjack wielder after being struck by it, and had kept the blackjack as a souvenir. I can tell you no more of the fate of the blackjack wielder.

Roger and I continued to go through my grandfather's things. We came upon a pencil cup full of pens of various types. My cousin ran his fingers across the top of the pencils and pens, and remarked, "Wow! There are enough pens here that all of the grandkids can have one." Now, I immediately realized that Roger was thinking, "What can I get out of Grandpa's death?"

This statement had a very profound effect on me. I was disgusted with Roger. I must admit that to this day, I cannot look at Roger - we're both in our 50's now - without remembering this statement. My grandfather had died, and Roger was wondering "What's in it for me?"

About 15 years later, my maternal grandmother passed away. Although my mother's family was much smaller than my father's extended family, we still had the typical near-reunion gathering.

We dutifully gathered at my grandmother's house - not much larger than my paternal grandparents' house - and talked about my grandmother's life and death. My mother and her three sisters were going through my grandmother's things and I was told "to take something for myself." I demurred, but my mother insisted I take something with me. One of my brothers had taken the color TV, and another of my brothers had taken my grandmother's Buick.

I remembered as a kid, we would sit around listening and basically being bored as the older folks talked, and I would mostly stare at a "century clock" - also called an anniversary clock - that my grandparents had on their mantle. I was always fascinated with that clock and the small weights at the bottom that would spin one direction and then the other apparently forever. This clock was the one item I always equated with my grandparents' house.

So, of course, that's what I asked for. My mother's younger sister immediately chimed in very vehemently, "No! That's mine! I have already packed it away." Now, I had only spoken up because I had been forced to do so, and I had chosen that item because it was what most reminded me of my grandmother. Immediately upon my aunt's tone and statement, I saw images of my cousin Roger and his coveted pencil cup. Instead of the anniversary clock, I asked if I could have the "rag rugs" that my grandmother had made herself.

Rag rugs are made by taking old scraps of material and making them into long, thin tubes. The tubes are then braided, and lastly the braids are sewn in a spiral fashion to make oval throw rugs. After the clock, these rugs, hand-made by my grandmother, most reminded me of my grandmother, so that's what I asked for instead of the clock. Even with a lot more cajoling, I took only the three rag rugs. When asked, I said, "These are what remind me of Grandma, so these are what I want."

I have a few other stories and memories, but these two tidbits illustrate why I've never put much value on things or money. I really don't need much, and I never saw the reason to accumulate wealth. I was born smart and I have always had the ability to make as much money as I wanted to; I just never really wanted to make money.

Now, I'm setting aside cash for my retirement, which is why I came to SA. As I never saw any value to money, but realize rationally that I need to save some for my DW when I eventually pass away, I came here to Dubai. I love my job, but I've had other jobs I love more. When I leave here, I'll go back to training - my true vocation. I doubt I ever "retire," as I actually love being in front of a class and the interaction and challenges of putting across the information so folks can genuinely understand the material. It's just that here in Dubai I make enough money to easily save and that's really all I'm here for.

Trees and Chores

March 8th, 2013 at 06:06 am

Joan of the Arch published her recent entry about raising some trees from seed. If you have read it, you'll see why her post elicited this response. It will be too long to post as a comment.

My father's hobby has always been organic gardening. He started back in the late 1960's when no one else had even heard of organic produce. He never has used any synthetic chemicals on his plants and always has the best harvests one could imagine. He had the first ever "compost pile" I had ever heard of, and he kept it out near the garden. All coffee grounds, egg shells, and other appropriate waste was correctly discarded there, including 100% of any plant or vegetable manner we did not actually eat such as husks, skins, pits, cores, or other jetsam of the plant/food world.

My father has always raised a wide variety of vegetables, and about 35 years ago, he decided to plant some fruit trees. He went through his seed catalogs and found some dwarf tree saplings that he purchased. These came as small sticks sticking out of burlap bags, to my memory.

My parents had four sons, each of us in our teen or near-teen years when the trees were purchased. Where I grew up, four teen-age sons is typically called "free labor." My father, at least, used us for any such purpose when needed.

My father decided the best way to plant the saplings was to dig holes in a very precise fashion. The holes were to be cubical in shape, and three feet (0.9 meters) on the side. They were to be 20 feet apart (6 meters or so). Once the holes were excavated, we were to layer one foot (30 cm) of rough gravel for drainage, then a layer of rough dirt for a few inches (10 cm) and then place a large rock directly in the middle of our now 18-inch hole. We were to spread the root ball around the rock, to encourage the emerging tree roots to spread laterally before plummeting to their ultimate depths.

The last layer of soil around the root ball was some organic concoction created by my father. We were emphatically told where the lowest point to be covered was on the saplings, and we were loathe to do any task other than how we were instructed.

My brothers and I, duly instructed in the above procedure - do you wonder why we're all very good at math? - commenced to dig the holes and construct the sapling beds accordingly. It never occurred to us to cut any corners, because we all knew that would mean only that we would get the pleasure of doing the chore yet another time, and this time correctly.

We used power tools to do the digging; arm-power and leg-power, that is. Our shovels were not particularly sharp and we had no pick. This was done by main-strength, as were almost all of our labor-intensive chores. Also, we were doing this in late Winter or early Spring, which in southern Virginia means "already hitting high 70's (metric mid-20s)."

We dug four such holes precisely arranged in an arc with our father's dimensions reasonably approximated. I don't remember how long it took to dig the holes - only three of us were harnessed to the task as our youngest brother was not very healthy at the time - but I can assure you that it was hard work and not done in a single evening.

The trees were planted precisely according to my father's plan, and watered precisely on his schedule. We were also tasked with keeping his garden weeded and watered, though it actually needed very little maintenance due to my father's year-long preparations.

Our tasks included turning the compost pile every two weeks. This was done by using the same shovels and, starting in the middle, digging down to the hard soil and putting a bit of hard soil as well as the decaying/composting material to the top of the pile, and the old soil/material that was on the top to the bottom or middle. Basically, it was using a shovel to stir the pile. The heat from the decaying material as well as the dry cold air that any growing roots so-turned would be exposed to meant that most of the compost pile had no weeds growing and nearly all the weed seeds killed before they germinated or shortly after sprouting. Still, we had to pull some minor weeds from the edges.

About three months after planting the trees it became evident that the trees were no longer in the realm of the living. They were rotting in the holes and one actually broke off and fell over. My father called the seed company and obtained new saplings without additional payment as we were all certain the saplings were DOA, as our preparations and care were precisely according to the schedule laid out by my father.

About the time we were waiting for the replacement saplings to arrive, my father was tending his garden and compost pile. He saw a "weed" on the edge of the pile and pulled it up, only to find it was actually a germinated peach pit. We had been to Georgia the previous summer and this pit must have been one from the bushel or so of peaches we purchased on our drive back to Virginia. My father replanted the pit and told all of us boys to avoid "weeding" it when we cleaned up and turned the compost pile.

About 20 years ago, I had a chance to visit the old house. The peach tree back by the tree line that originated from the volunteer pit was about 20 feet tall and gorgeous. The four replacement trees were also doing well, after having been re-established in place of the failed crop.

I'm always amazed that my father never mentions how the volunteer peach tree grew unaided, while the meticulously-planted and painstakingly-cared-for saplings died out of hand.

Paid a Stupid Tax

March 3rd, 2013 at 02:08 am


Followers of Dave Ramsey know what a stupid tax is. For those of you who do not know, a stupid tax is money you lost, spent, or had to pay for doing something that, in hindsight, is stupid.

In our case, DW and I are intent on eliminating our mortgage. We are so intent on it, that when a milestone presented itself as being "in reach," we reached out and grabbed it by paying more than we had planned for February.

Well, the bank statement had a $12 fee... What the heck?! It's "free checking!" As I live overseas, I cannot make a direct deposit. Therefore, free checking requires a $1500 minimum daily balance. Well, we dipped below $1500 for a couple of days, and whammo! $12 down the tubes.

Now, a lot of folks would tell me to go to the bank and complain to get my money back. I have a very strict code of ethics. If I were in the right, I would definitely complain - loudly and long - until I got the charge rescinded. In this case, though, I was in the wrong, and therefore will pay the fee.

The real kicker is that we have enough money in our other accounts that we could have easily transferred the money before sending the payment and avoided the fee altogether.

I hope it is "lesson learned," and we don't incur the onerous fee again. I think the $12 amount is outrageous, and when I get a chance, I'll be transferring my accounts to my "other bank." We have avoided doing this so far, only because of all of the direct withdrawals we have coming from the current account. The twelve dollars is our incentive to make the effort to get away from what Clark Howard terms "the big monster megabank."