When I was 20 I needed a new alarm clock.  I went down to Walmart and bought the cheapest one they had. It was $3.  It’s black with big red numbers.  It doesn’t do anything fancy at all… it tells time and has an alarm.  That’s it.  It’s honestly not much bigger than a deck of cards.   I remember the purchase very clearly.  I remember the packaging it came in (cardboard bottom with a clear plastic dome, and the price tag.  I wasn’t sure I could trust a $3 alarm clock and figured it would break fairly soon.

But here we are 12 years later…

I realized this because my 3 year old son is learning to tell time.  And by “learning to tell time” I mean being able to tell the hour on a digital clock and getting a faint understanding that certain things happen at a certain time.  The “certain thing” that I’m hitting hard is that 7 am is morning time and he isn’t allowed to get out of bed until 7:00.  So I did the same thing I did with my daughter, I covered up the minutes on the clock in his room.  So no more getting out of bed at 6:37 and then again at 6:47 and then again at 6:57.  Only 7:00.  But as I was pointing out the hour to him I thought back to when I was teaching my now 7 year old the same thing.  It dawned on me that I’ve had that alarm clock my entire adult life, pretty much.

That little $3 alarm clock is 12 years old and still going strong.  It’s woken me up for about 5 different jobs, including one where I had to be there at 4:30 in the morning.  (We had a real love/ hate relationship going back then.)   It’s moved with me across the country, twice.  And now has taught both my kids how to tell when it’s time to get up.

I wonder when Walmart’s cheapest alarm clock will give up the ghost?  Do you have anything that you have gotten way more than it’s value out of?

pic by: wan fauzan

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Every year at this time I go through the same set of arguments with myself.  My son’s birthday is in February and every year I have to decide whether or not to take him to get his pictures taken by an actual photographer.  (Here’s last years post about it).  It seems like such a waste of money, and yet somehow I feel guilty about not taking him.

Since he has been 3 for 3 months I figured that I’m at the point where I have to take him or skip it.  If I wait much longer he is going to be closer to 4.  So yesterday I found a coupon at Sears with no sitting fee and buy one get one free sheets.  I figured that was a good deal.  My best memory is that sheets are $7.99, and I don’t need a ton, two or three sheets should be plenty.  So I figure I can get out of there for less than $20.

HAHAHAHAHAHAHAHAHA

Either I’m crazy or prices have gone way up.  It was $16.99 for a sheet, and the buy one get one free is for the same pose only.  So if I want 3 different poses, which I did, then I had to buy 3 $16.99 sheets.  I spent $55.  Was it worth it?  I don’t know, not right now.  But they are nice to have and when the kids are grown I’m going to treasure all their pictures.  Will it be worth it then?  Probably.

But man he was cute.  He’s pretty shy and the photographer lady was kinda freaking him out.  He just stood there with a totally blank face.  He would do whatever she told him, put your hands in your pockets, sit down, look this way, ect… but he would not smile.  It was hilarious.  But somehow he does have smiles in his pictures.  And I know that in the background I’m giving an over the top reaction to a stranger tickling me with a stuffed frog.  haha.

One thing that I cannot believe is how much they expect you to spend on pictures.  It’s insane!  I sit down at the little table with the photographer and she starts explaining all the packages.  The first one was $350!  My mind kind of glazed over after that, so I’m not sure what the others were.  Here I was planning on spending $20 and she is talking $350.  I don’t think so lady.  Luckily I don’t have that much family, I’m just getting them for myself.  One 5×7 of each cute pose is good enough.

How much do you spend on professional pictures of your kids?

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I signed up for classes for the fall.  Blah.  I’m taking Business Ethics and Math Analysis (some business math class).  Sounds thrilling doesn’t it?  Tuition was $525 (in-state at the local community college).  It’s more than last year.  Last year was $440 for two classes.  So it’s gone up 20%.   That’s quite a bit.  And of of the classes is only offered as a four day a week class, they don’t have it on Tuesday/Thursday, or Monday/Wednesday schedule like every other class I’ve ever taken.  Which means I have go to school every day.  Not looking forward to that!

But the good news is that my school has an on campus preschool.  The kids can go when they are 3.  My daughter went there when she was 3 and loved it.  So I’ve been waiting to be able to send my son.  It’s great because it means I can take classes during the day now.  Which leaves more family time at night, and I think my son will really get a lot out of being around other kids.  We really don’t have a sitter, so he’s pretty much never been away from my husband and I.  I think a little separation will be good for him.

The preschool costs $2.50 an hour and he will be there 10 hours a week.  $100 a month for part time preschool is ridiculously cheap.  I’m thrilled with it.  Any place else would cost at least twice that.  But even this has gone up a lot.  4 years ago it was $1.60 an hour.  But I’m not complaining.  Having him right on campus for half price of a regular preschool is worth every penny.

So total costs for this semester will be:

Tuition: $525
Books: $150 (estimated $75 per class)
Gas: $190 (estimated $2 per gallon)
Preschool: $400
Total: $1,265

pic by: striatic

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About a week ago my husband asked me what I want for Mother’s day.  My birthday is also in May, so it’s double gift giving time for me!

But I am the hardest person in the world to shop for.  I can’t even shop for myself.  Knowing this I try to actually think of a gift suggestion when I’m asked.  But it’s really difficult.  You would assume that it would be very easy to think of something you want for free.  But it’s not… not for me anyways.

So I’ve been thinking for the past few days.  What I really want are things that other people can’t really buy for me, like clothes.  I need a new pair of sunglasses, but I need to pick them out myself.  I could use some shorts, but again… I need to shop for them myself.  I’m really not someone who is into material things.  I feel that I have everything I need.  So the thinking continues…

Then yesterday morning I went to make my son and myself a bagel.   I put the two halves into the toaster.  And wait.  And wait.  And wait.  I finally notice it’s been a very long time, so I manually pop up the popper and the bagel is black.  GRRRRR.  I hate this toaster!  A waste of a bagel and now I have to wait for the toaster to cool down so that I can try again.

But at least it gave me a Mother’s day gift idea.  A new toaster.  Come to think of it… I asked for it for Christmas too.  I guess my husband doesn’t think a toaster is romantic enough.  haha.  I suppose he’s right.  But it will make my morning a happier place, and that’s romantic.  Maybe he can find one that toasts a heart into the bread.

So what are you hoping for as your Mother’s Day gift? What are you planning on getting your Mom?

pic by: imagesniper

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My schedule is chaotic right now… So to try to get me through til the end of the semester (Finals on May 11th!) I’m going to be filling in the gaps with some articles that I wrote last year.  Should be brand new material to most of you since I only had a handful of readers back then.  If you remember these posts, then you are one of my most loyal readers.  I owe this blog to you since it was my early subscribers that motivated me to continue.  :)  Thank you.  I apologize for the rerun.

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We had to renew our Costco membership this weekend. They sold us on upgrading to the executive membership. It costs an extra $50 but you get 2% cash back on everything you buy at Costco. Which is pretty cool. Plus I get to go at 10:00 in the morning rather than having to wait til 11:00 when it opens for all the “normal” people. Which is way easier for me.

We normally spend about $100 a month just on groceries, so if we buy any big stuff it could put us over the $2,500 we need to make $50. We also buy tires and Christmas presents for the kids there. I bet over the year we could come pretty close to spending another $1,300.  Especially if my husband gets his wish and we buy a new plasma TV for the living room. (He did, but we didn’t end up buying it at Costco)

But the cool part is that the program is risk free. If you don’t get at least $50 back they refund you the difference. So if our check is only $40 then they give us $10 back from our membership. So really, might as well do it, because the worst you can do is break even.

I can’t help but think, why do they offer a risk free cash back program. Where is the benefit for them? It didn’t take long for me to figure it out. I’ve been an executive member for about 5 days now and I’ve thought of several things I should start buying at Costco. Plus I automatically take 2% off the price of everything there. I need to stop doing that. The first $2,500 I spend there isn’t extra money anyways, so I shouldn’t be shopping with that in mind.

What we really hope to do is earn $100 a year, that way we can get our entire Costco membership for free.

Update: We ended up getting $91 back.  So close!

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I doubt you remember but a while back I wrote a post about how my husband is saving his change for a new TV for our living room.  Well, all that saving finally paid off.  He’s been putting all his change into a five gallon water bottle in the closet for almost 5 years and about two weeks ago he went out and got himself a shiny new TV.

We got this one.  That might not be the exact model number, but that’s basically it.  It was on sale for about $1,500.  My husband had $900 in change saved up.   He got the rest of the money from a pool of money him and some friends had been saving up for a trip to Vegas.  They have been saving the money here and there for about a year.  Unfortunately, everyone that was going on the trip got laid off, except for my husband.  So they decided they would cancel the trip and all split the money evenly.  So between his share of that and some slush he had in his personal checking account he was able to come up with the balance.

But the costs don’t stop at the TV.  Our old entertainmet center wouldn’t work with the new TV.  So we needed to buy a new one of those.  And we pretty much needed it right away.  Target happened to be having a sale, so I found one that works for $160.  And of course we can’t go without the HD service now that we have an HDTV.   Which we didn’t even have digital cable before, so it’s quite the upgrade.  I even splurged on the DVR service, which we may or may not keep.  I will give it a couple of months and see if it’s worth the money.  But all in all our cable bill went up $25 a month.

pic by: Kecko

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Is there such a thing as good debt? I’ve never really liked that term, “good debt”.  I don’t think there is truly such a thing.  But I do think there is bad debt, and then less bad debt.  Two examples I can think of that could be listed in the “less bad debt” category are mortgages and student loans.  Both of those debts buy assets.  One tangible, a house, and one intangible, an education.

I wrote a post the other day about business credit.  I took a little heat for suggesting that we will take a loan to pay payroll if necessary.   (read that post here) This actually surprised me.  I know that a great deal of my readers are anti-debt but still, I wasn’t expecting that.   After all, I am buying an asset with my debt.  I’m buying an account receivable.

The comments against us using credit had two main points that I wanted to address.  One was that we should grow more slowly.  The problem is that we have an agreement with a national company to do the work in our area.  They have taken a chance on us and made us their first priority vendor.  They are our only customer.  It could be suicide to let our competitors back into the picture.  The second point was that we don’t know what our future sales will be.  This is true, but the payroll is based on past work, not future work.  Even if we close our doors the day after taking out the loan, we will still be able to pay off the loan when we get paid.   Yes, there is a risk of default.  But I feel this is a very very small risk.  This is a company we have experience with and know other people who have done work for this company and have been paid in a timely fashion.  Business is not without risk.  I truly believe that the risk/ reward ratio is well in our favor.

What if you a had family member that got laid off and is about to get their house foreclosed upon.  Lets say that they are willing to sell you the house for what they owe, which is half it’s market value.  Would you do it?   What if you had an agreement with someone to buy the house in 60 days for full market value?  Now would you do it?

That’s the situation that we are in.  Not only are we are also helping out family and friends who have been laid off by giving them a job, we also stand to make quite a bit of money.

So here is the question… Is there such a thing as good debt?  Is there ever a situation where it’s ok to take out a loan?  Or is all debt bad, no matter what the circumstances?

pic by: Kevin Dooley

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How much to reward good grades is a subject of much debate.  But I think good grades should be rewarded one way or another.  I always make sure to point it out if we are doing something because my daughter gets good grades.

For example, when we went to Disneyland in January my daughter missed 4 days of school.  I made sure she knew that we couldn’t have done that if she didn’t have such great grades.  I went on and on about how if she was having trouble in school we couldn’t have let her miss days to go Disneyland.  I tried hard to not make it sound like Disneyland was the reward for good grades.  (I certainly can’t keep up that standard!)  But instead tried to show her that her good grades gave us the opportunity to go to Disneyland.  It’s a subtle difference, but I think she understood.

That said, last weekend we went on an official reward outing.  We went to see Disney on Ice, just my daughter and I.  We got dressed up very fancy and had a night on the town just the two of us.  It was a lot of fun.  During the week I had taken her to Target and let her pick out a new dress.  Any dress she wanted.  They had all the Easter dresses on display she had plenty of extra fancy dresses to pick from.   She picked this one.   It’s really cute on her.  I think she made an excellent choice.   She also got some new shoes to go with her dress.  She wanted these, which admittedly did look nicer with the dress, but I got her these ones.  I had executive powers on the shoe choice because I really needed her to get something she can wear all summer.  It’s one thing to buy a dress she is only going to wear twice (we have a wedding this summer).  But shoes too… that’s where I draw the line.

I didn’t calculate every dollar.  But I would say the whole night cost about $80.  That includes, the tickets, her dress, and parking.  It’s a lot, I admit.  But it’s not something we do all the time.  She wanted to go see that show and I felt a reward was in order for her awesome grades this year.  I know she’s only in first grade, but I figure making a big deal out of good grades won’t hurt anything.  Not everyone gets straight A’s, even in first grade.

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My daughter came and plopped on the couch next to me the other night and asked, “So how do you get started on a grown-up life?”  She’s 7.  I don’t know why she is so worried about having a grown-up life but she is.

Man… the possibilities here.  I know I don’t want to screw this up.  The answers I give to this question will come back to haunt me.  Whether that is good or bad is up to me right this second.  Ahhh… the pressure!

Sigh.   Think think think.  Definitely mention college.  Definitely mention getting a job.  Don’t mention living with a boyfriend or getting married or anything like that.  Hmm…

“Well… ” I start.  “First thing you need to do is finish high school.  Then you can get a job, like work at a store, or in a restaurant or something like that, or anything you want.  You can live here, and work and go to college.  Then when you are finished with college you can get a job doing whatever you went to school to learn how to do.  Then you can get an apartment either by yourself or maybe with a friend.  You can save up your money and buy a house.”

“And then I can get married?”  she asked.

“Yes, and then you can get married.”

“So get a job, save up for a house, buy a car, and then get married.”

“Well, you will probably save up for a car before you buy a house.”

“Yes!” she exclaims and then runs out of the room.  Apparently she just wanted to know when she could buy a car and get married.

Looking back I should have stressed getting good grades a little more.  Impressed upon her that if she gets good grades she can go to school for free.  Oh well… there will be time for that I suppose.

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I know on an intellectual level that access to credit is important when you are running a business.  I’ve heard that but I never really understood why.  If you are a regular reader of this blog then you know that I dislike credit in general.  Part of me has always felt like if you are running your business properly then you shouldn’t need credit.  However, I’m starting to understand why it really is important for running a business.

First things first, I mailed our first invoice the other day.  It was for almost $3,000!  I like that a lot.  It’s gotten a bit busier and I have two people working now.  Which is great… cause we make money for each hour that they work.  But the thing is that we have to pay the techs looong before we get paid any money.  I’ve paid about $500 in payroll so far.  But tomorrow I have to do it again, and this time it’s going to be for about $1,500.   I will need to take that whole amount out of our savings.  I’m hoping that our customer pays the invoice before I have to pay payroll yet another time.  But there is no guarantee of that.  In our contract they have 45 days.  I’ve heard through the grapevine that they pay quicker than that… but we will have to wait and see.

At this point we have contributed $3,000 to the business.  With this next payroll it will be $4,500.  I could possibly have to pay a third payroll out of pocket before receiving any payment on the invoice.  We could be talking over $6,000 out of pocket before we see a dime in revenues.  Then if each month is busier than the last it could be a long time before we have positive cash flow.  Always playing catch up with the invoices.  Always paying more in payroll than the previous month’s sales.

So far we have been able to contribute to the company with money from savings.  But eventually that money will run out.  Then what?  We will have to get a loan.  On one hand I hope it doesn’t come to that, but if it means we are really busy then maybe it would be a good sign.  I will only need to resort to a loan to make payroll if we just keep getting busier and busier.

So I finally get it… Credit is a necessity when you are running a business.

pic by: miguelb

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