Wide Open Wallet

An honest look at family finances

Archive for July, 2008

Can you really help someone?

Can you really help someone? That’s always been a big question for me. I mean, beyond medical things, it seems people’s situations are usually their own doing. I’ve talked about a friend of mine who misses opportunities to improve her situation. I don’t think giving her money would be any kind of help. But if money doesn’t help someone who is struggling financially, what will? Education?

It’s the whole teach-a-man-to-fish conundrum. When is giving a man a fish appropriate? Recently I read about the Harpers from Extreme Home Makeover who received a brand new home and a boatload of cash, but they are still getting foreclosed. So what could have helped them? What on earth could ABC have done for them? I don’t know their particular situation but maybe if they had spent the week at some kind of self improvement workshop rather than Disneyland they could have improved their situation. You know, if ABC had taught them to fish as well as giving them a fish.

It seems like a pretty cold perspective to say that it’s impossible to help people. But in a way it kinda gives me hope. If people’s situations are based on their own doing then that means my situation is based on my own doing. And I like my situation. I like my life. I, apparently, did this all by myself. That gives me security. When hard times come (as I’m sure they will) I don’t have to worry if someone is going to be there for me. Because I can’t be helped! I will be there for myself and that’s all I need.

pic by: Poagao

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  • Filed under: life
  • Living like kings

    Sometimes when I’m feeling ungrateful or like my stuff isn’t as good as everyone else’s stuff I try to remind myself how good I really have it. In reality we live better than kings! I think about what life was like during the Middle Ages. No running water, no electricity, no cars, no phone, no out of season fruits… I can’t even make a reasonable list of things we have that even the kings couldn’t get back in the day.

    Just being able to bathe everyday was difficult. The king was one of the few people who could afford fire wood to heat their bathwater. No turning on the shower, even for a king. Light a fire and wait for your tub (which was also made of wood) to heat up.

    The first floor of the castle was dirt and the second floor was wood boards. Sometimes the boards were covered by greenery which was replaced periodically. This left quite a dangerous mess when you consider the fact that the castle was heated by fireplaces.

    The king’s bed was a wooden frame with a weaving of ropes or strips of leather supporting a feather mattress. No pillow top or memory foam here. Nighty night!

    At a royal gathering only the king would have his own cup. Guests would share one cup that was brought around by the cup bearer. The food was heavily seasoned to disguise the fact that it was rotting. The food was served on bread and eaten with the hands. No plates and silverware, even for the king!

    Communication was also difficult. Today we have several methods of direct communication. Back then a king would write a letter on parchment with a quill and it would be delivered by hand to the recipient. This could take days, months, or even years. Common folks had to rely on traveling salesmen to deliver messages. Think about that next time your texting a complaint about how you need the new latest and greatest phone.

    Health care was hard to come by. Twenty percent of women died during child birth and 17% of infants died before they were a month old. Even the king couldn’t avoid these odds. Stitches were made by letting a certain kind of ant bite the edges of the wound together. When the ants had bitten down they would not let go. Once healed, the ants would be removed. Pleasant and sanitary!!

    When you think of all the modern day comforts we have today it’s hard to not appreciate our lives. Next time your feeling down that your neighbor has a nicer car than you, think about the fact that you’re living better than kings could even dream of. At least you don’t have to be pulled in a wooden cart by a horse on a road full of potholes. You can take a shower, you can call a friend, you can sit on your couch with a bowl of popcorn and watch a movie.

    pic by: Shadowgate

    Resources:

    Kyrene

    Medieval Life

    MNSU

    MNSU

    Castle Wales

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  • Green Living: Energy Smart

    It’s Tuesday again, and that means we are going green. Just a reminder that this series has been inspired by David Bach’s latest book, Go Green, Live Rich. And you can enter to win this book by leaving a comment on Green Living days.

    While we are waiting for Solar Power to become the norm, we have to be cautious of how much electricity we consume. Using less will help with not only your bill, but the environment too.

    There are several things you can do to reduce the amount of electricity you use.

    1. An Energy Audit: Call your electric company and see if they offer a free energy audit. Someone will come to your house and identify places in your home that are not as efficient as they could be. If your power company doesn’t perform this service there are several websites that can help you either find a professional to do it or give you tips on how to do it yourself. The U.S. Department of Energy has one you can check out. Making the changes suggested on your audit can save you between 5% and 30% on your energy bill.

    2. Turn the heat down (or the air up): If your heating your home, make it a little bit cooler in there. If your using the air conditioner, make it a little bit hotter. Just one degree cooler in the winter will save you $40 a year.

    3. Stop the phantom load: Stuff that’s plugged uses electricity even when it’s off. When I first heard about this I laughed. Yeah right! But apparently it’s true, and I suppose it makes sense. 5% to 15% of your electric bill goes to stuff that’s turned off. You can combat this by plugging into power strips so you can shut it off for real. Why pay for stuff your not even using?

    4. Compact Fluorescent lights: I switched almost all the bulbs in my house to these. If you are concerned about the look of the light they give off, don’t be. I noticed a difference at first, but now I don’t think a thing about it.

    5. Trees: This one is obvious to those of us who live in the desert, but trees give shade, and shade helps keep your house cool in the summer. A cooler house means less electricity for the air conditioner. But even besides that, trees help process the CO2 in the air, which helps with global warming. Plus, they look nice.

    What have you done to reduce your energy consumption? Have a great tip? Do you think energy conservation is for crazy people? Leave a comment and get an entry to win David Bach’s latest book. ***Contest has ended***

    Other posts in this series:

    Bottled Water

    Green Credit Cards

    Solar Power

    Shop Smart

    Babies

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  • Filed under: green living
  • 5 easy ways to increase your savings

    There are many things in life that are dependent on your income. But one thing that isn’t is your ability to save. Everyone can save money. You are never too poor to put a little something away. It may not be a lot of money, but even small amounts will add up. There are several things you can do that will make a difference over time.

    1. Save your change. The power of change is often understated. I first learned about the power of change while working at a coffee shop. Customers often left their change as a tip. Fifty cents here, a quarter there, maybe the occasional dollar bill. It doesn’t sound like much but at the end of a 6 hour shift my co-workers and I often had over $200 to split among us. Which worked out to about $40 each. My second lesson was when I met my husband. He has a 5 gallon water bottle that he puts his change into. The first time we emptied it we had enough money to pay for our honeymoon. He is currently saving up for a flat panel TV for the living room. I have no doubt that one day we will have a new TV paid for entirely by change.

    2. Set up direct deposit. There is no easier way to save than just making it automatic. The most painless way to do this is to set it up right after you get a raise. But that doesn’t mean to wait until your next raise. Even $5 or $10 a paycheck will add up over time. Start small and increase it little by little.

    3. Claim zero. Oh the controversy! If you can’t stand having money in an account staring you in the face then let the government hold it for you. I know you will be losing some interest but we aren’t talking about a lot of money here. If you put $100 every two weeks into a savings account earning 2% you will only earn $27 a year. So if temptation often gets the best of you saving up for a big tax return is an option worth considering.

    4. Tuck away a windfall. Every once in a while a lump sum comes along. Whether it be a bonus from work, a birthday gift, or ahem… a tax return. Take that money straight to the bank. This is something I’ve pretty much always done. So much so that when my dad gave me money as a high school graduation gift he ordered me to spend half of it.

    5. Pay extra towards your debt. I consider paying down debt as a form of savings because your using the money to make your future easier. So again, if you have trouble not spending your savings then paying down debt is a good thing to do with your extra money. I would rather see you paying down debt than spending aimlessly.

    If you do some (or all) of these things you will see your savings grow over time. A lot of small changes add up to big changes over time. You’ll never regret it!

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  • Filed under: saving, snowflaking
  • Roundup

    Another week just flew by.  There’s only one more full week of summer vacation left.  I can’t believe it.  I still have lots to do to get ready to send my baby to first grade!  wow.  Anyways, I participated in 3 carnivals this week.  On Monday the Carnival of Personal Finance included my review of My Gallons.   On Tuesday the post about my financial history was editor’s pick on the Carnival of Money Stories.  Also on Tuesday the Carnival of Frugality included my post A Trip to Costco.

    PF Bloggers:

    Master Your Card takes a look at the rich to see what we can all learn.  #5 is the one I have the hardest time dealing with.

    Get Rich or Die Trying tells us about how they do allowance in their house.  This post inspired my recent post about allowance.

    No Debt Plan advised us to document our stuff, and gives a plan to help do it.  A really good idea, and it seems easy enough.

    Around the Blogshpere:

    Budgets are Sexy gave us her personal favorite pieces of financial advice.  What are yours?

    Frugal Dad discusses the benefits of paying off the mortgage early.  As someone who is paying extra every month to the mortgage, I couldn’t agree more.

    My Two Dollars gave a list of frugal advice from his his friends.  This should keep you reading for awhile!

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  • Filed under: roundup
  • Chores and allowance

    I’ve been thinking about how we issue allowance in our house. The way it is now is that my daughter has 5 chores (make her bed, clean her room, unload the dishwasher, pick up family room, clear the table) and there is a chart on the fridge with all 5 chores listed. Each time she does one we put a magnet next to that chore. When she has done all the chores 5 times she gets $5.

    The problem lies in that some chores, like clean her room, don’t get done every day. Which is ok, but then it’s not motivating for her to do her other chores. For example, its very often that all the chores have 5 magnets except for cleaning her room. Cleaning her room will only have one magnet. So then there is no reason for her to do any more chores until she has cleaned her room another 4 times. See what I’m saying?

    Another problem is that we don’t have anything that she does just for the good of the house. Potentially, she gets paid for every thing she does around here. Now that she’s older I think I could give her some more difficult chores and have her not get paid for the simple things, like making her bed.

    This little problem has been on the back burner for the last few months. I finally have a solution I’m going to try. The first thing I’m going to do is change the chores a bit. I’m taking away clearing the table and making her bed. She still needs to do those things, she just isn’t going to get paid for them anymore. Then I’m going to add drying the dishes and wiping down the bathroom counter. Finally, I’m going to get a roll of raffle tickets from the craft store and a jar. Then each time she does a chore she will earn a ticket. She can trade the tickets in for money. Maybe a quarter each?

    That’s the plan. I think it will work better since she will get a more immediate reward for doing her chores and get credit every time she does a chore.

    Update

    Pic by: alycat

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  • Filed under: kids
  • Yesterday, I was sitting on the couch, laptop on lap, cartoons blaring and my daughter asked me a question. I honestly can’t even remember what it was, but my answer had the word “mortgage” in it. She nodded like she understood and went back to watching her cartoons. I could have let the moment pass and gone back to whatever I was doing. But I didn’t…

    “Do you know what a mortgage is?” I asked.

    “No.” she replied.

    “Well, houses are very very expensive and lots of people don’t have enough money to buy one. So the bank will give them the money and they have to pay it back. Does that make sense?”

    She nodded and I didn’t know if she understood, or if she was even listening. But later that night, out of nowhere, she said…

    “When I get big I’m going to have the bank help me buy a house.”

    “Cool.” I said giggling.

    “How do you do that?”

    “Well, you have to ask them if they will help you. And then they either say yes, or no.”

    “And then what?”

    “Well, if they say yes then the bank gives the person who is selling the house the money. And they send you a bill every month and you have to pay them back a little bit every month.”

    “And what if you don’t want to have the bank help you?”

    “Then you have to give all the money to the person selling the house by yourself.”

    At first I thought 6 years old might be too young to start talking about mortgages. I mean, jeeze, she doesn’t even understand the concept of change yet. But clearly she did get something out of it. She was still thinking about it hours later. I didn’t want to get all crazy and talk about interest and down payments so I left that part out. I want so badly for her to understand all the ins and outs of personal finance, and I want her to understand it early. Early enough that she can keep herself out of trouble before she even earns her first dollar.

    I want to get back to the concept of change real quick: The other day she bought herself a little something with her allowance and she got about 80 cents in change. We were walking out to the car and she said “Wohoo, I’m getting rich!” as she put her change into her pocket. lol. Clearly I have more work to do!

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  • Filed under: kids
  • Missed Opportunities

    I have a friend who always is complaining about not having any money. Always. And yet she is constantly misses opportunities to change her situation. I don’t get it. It makes me a little crazy.

    When I first met her I was impressed by their financial situation. Not because they have fancy things, quite the opposite in fact. She is a full time student but takes all her classes on line so she can be home with her son. She also babysits part time for a child with special needs. They live in old army barracks that have been turned into student housing for students who have children. And they only have one car, which her husband takes to work. She’s a smart girl, it seemed to me that they really had their stuff together. They were making sacrifices and doing what they had to do to get by while she finished school. I was impressed by that.

    Come to find out that isn’t really the whole story. First off, she takes more student loans than she actually needs and they live on the excess. That kinda rubs me the wrong way, but I know lots of people do that. In a perfect world everyone would only finance their books and tuition, not their groceries. I found this out because she had planned a huge blow out birthday party for her son. And then told me she couldn’t have it because she wasn’t getting as much in her student loan as she wanted. I cringed. She wanted to finance a birthday party for a two year old.

    The reason they only have one junker car is because their credit is horrible and they won’t save enough money to buy another one with cash. Horrible credit means more financial irresponsibility in the past. I don’t know the story here, but I have a feeling if I asked she would tell me a story about why it’s not her fault.

    She was telling me recently that the dentist advised her to start saving up for braces for her son. She told me she can’t possibly save any money. “Maybe when we are making more.” She said. But two minutes before that she was telling me about her son’s third birthday party. And how you can rent the whole bouncy place for “only $400″. Gulp! What! She can’t save for braces but she can spend over $400 on a party? This is what I’m talking about. Another missed opportunity. When the day comes and her son needs braces she will again complain about how expensive braces are and how she can’t possibly afford them. Will she remember that 10 years earlier she was told to start saving?

    I guess what’s frustrating is that she is half way to being in a good position. Her living expenses are very low. All she needs to do now is plug the holes. It really wouldn’t be much of a lifestyle change. She just needs a budget and some goals.

    Are you missing opportunities to turn your situation around?

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  • Filed under: life
  • Green Living: Solar Power

    It’s Tuesday again, and that means we are going green. Just a reminder that this series has been inspired by David Bach’s latest book, Go Green, Live Rich. And you can enter to win this book by leaving a comment on Green Living days.

    Solar Power

    Phoenix has 320 days of sunshine a year. Why everything isn’t solar powered here, I don’t know? When we got our hot tub I looked very briefly into having it solar powered but really, I didn’t know where to begin. There isn’t a ton of info about how to go about getting solar power for your home. What I found seemed awkward and expensive. So it’s hooked up to electricity. But David Bach listed this website, www.findsolar.com, in the book and it’s so helpful. If I had known about this site a year ago I would probably have a solar powered hot tub right now.

    The site asks for your state, county, and electric company. Then you choose what you want to power with solar. If I choose the Spa/ Pool heating option it calculates that it will cost me $1,066, after tax rebates. Yeah, it calculates state and federal tax rebates too! Which when you consider I paid over $800 to have it hooked up to electricity that seems like a really good deal.

    But the website doesn’t end it’s helpfulness there. You can also find companies that install solar power systems, complete with customer reviews.

    Before I left, I also played around with what it would cost to have my whole house solar powered. Wouldn’t that be amazing! No electric bills! Unfortunately, it’s not such a great deal as powering the hot tub. To produce 100% of the power for my home it would cost just over $87,000. Which at 6.5% for 30 years is a payment of $550. I currently pay $168 a month for electricity. So as cool as it would be, I won’t be switching my home to solar any time soon.

    But I get the distinct feeling that we are on the cusp of big breakthroughs in this industry. Almost $120 billion are invested right now in renewable energy projects. The instant solar (or wind) power becomes more cost effective it’s really going to take off. I think it will go the way of the computer, the technology will become cheaper and more powerful year after year. So it might not be long before seeing solar panels on the roof is a common occurrence.

    So what do you think? At what point would you be willing to get solar? Do you think I’m wrong in assuming solar power will ever take off? How much would it cost you to install enough solar power to power your whole house? Leave a comment and enter to win David Bach’s book! ***Contest has ended***

    Other posts in the series:

    Bottled Water

    Green Credit Cards

    Drive Smarter

    Energy Smart

    Shop Smart

    Babies

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  • Filed under: green living
  • A Trip to Costco

    I’ve talked a lot about my love for Costco. I’ve really been making a go of it for the last few months and I’ve seen a huge drop in my weekly shopping. I went to Costco on Friday and spent $149.11 plus tax, but look at all the stuff I got! Please excuse the total dorkiness of organizing my Costco booty so I can take a picture of it. It was a big trip because I had a bunch of coupons. Here’s the breakdown of what I bought and how much I saved. The prices listed for Costco include the coupon and the prices listed for Walmart are what you would pay for the same amount of stuff as I bought at Costco. For example, at Walmart paper plates are $3.44 for 50, so it would cost $15.30 to get the Costco amount of 225.

    Item Costco Walmart
    Paper plates 12.49 15.3
    Baby wipes 11.99 27.46
    Dryer Sheets 6.49 9.35
    Parmesean 7.99 9.84
    Razors 21.98 32.64
    Hot dogs 13.98 18.56
    Milk 5.23 7.04
    Strawberries 5.99 9.96
    Diet Coke 6.99 8.64
    Toilet Paper 15.99 18.75
    Diapers 39.99 41.76
    149.11 199.3

    So I saved $50.19 over Walmart on this trip alone! Crazy! I had $25.50 in coupons. Plus I get 2% back from my executive membership and another 1% from my American Express card, which isn’t figured into the total savings. I did notice that the strawberries were the same price per pound at Fresh and Easy as at Costco, so I don’t need to buy the whole 4 lbs at once if I don’t want to. Although my kids can burn though some strawberries, I’m tellin’ ya. They were almost gone on the first day. But I did use one pound to make my super awesome Strawberry cake.

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  • Filed under: life
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