As promised, I spent this last week reflecting on (and engaging in!) activities and treats that can be enjoyed while being poor. I thought about titling this post, "Be Poor, Feel Rich," but that's actually the exact mentality I'm trying to avoid. I don't want to feel rich; that brings with it the awful sense of entitlement which, as I mentioned last week, causes financial binging.
Instead, these are ways of enjoying the simple things in life, accepting that they're simple, and enjoying them for it. Luckily, simplicity and a return to a less-complicated lifestyle are very much in vogue right now, so we cheapies can maintain our social credibility while keeping a lid on our wallets.
I've categorized these into groups based on their wealthier counterparts, and will post one a day for the next week. Feel free to share your own tips for alternatives in the comments section!
1. Going to the gym
So, SO many great options here! I'm not going to lie, the idea of having a gym membership appeals to me a heck of a lot. Especially one of those "VIP" memberships that include tanning and (sound angelic chorus here) included child care. If there was ever a motivator to get in shape, the idea of having a break from watching my kids while doing it IS THAT MOTIVATOR. So, yeah, maybe when I'm not dirt-broke it's something I'll look into.
That's later.
For now, I can still enjoy a gym's health benefits without having to visit one. For starters, parks and nearby neighborhoods offer exciting sights for my baby to look at, while giving me ample room to walk and/or run. But that's obvious already.
One slightly less obvious option is to combine workout time with play time by organizing a running group. The couch to 5k program is a great one for beginning runners, and includes abundant breaks for walking and talking. Three days a week for eight weeks will take even the fitness flunkout to the point of running, non-stop, for thirty minutes or 3.1 miles. Productive, social, and actually secretly fun, this program is an awesome way to make up for the lack of gym time!
But fitness doesn't always have to include running, and if you know you are not a runner, it's something that can often get brushed aside. Expecially since we know that obesity rates are much higher among lower-income populations, this to me is an area where a little splurge might be worth it if it will make workouts a more regular part of your day. For example, a gym membership in my area would cost me about $20-$40 a month, or $35-$80 for both my husband and me. In contrast, a cheap set of weights and a well-reviewed workout dvd in a fitness area that interests me or fits with my schedule could cost as little as thirty. Even better, I recently discovered on hulu.com that they actually have some workouts available to watch for free online, so if things are really tight you can skip the cost of the dvd altogether!
One other secret along those lines is craigslist. Ever seen an infomercial for the Power 90 workout program? Expensive-looking, right? Well, there are plenty of people willing to part with their used dvd sets for significantly less than retail value. That's not the only one; many other dvds can be found this way.
Or, if you just HATE exercise but want to be in shape, you can buy a used treadmill or elliptical on craigslist for as cheap as 80-100. Granted, it won't be a fancy model, but anything that will work can be set up in front of a television or computer (or laptop!) to allow the viewing of all your favorite, free cable shows while you gradually grow numb to the pain of having to exercise while doing it. It's a big up-front purchase, but it's significantly cheaper than a gym membership and has a decent resale value, especially if you buy from the bottom end of the spectrum.
Thursday, October 28, 2010
Wednesday, October 27, 2010
And THAT'S What You Call a Step in the Right Direction!
Last night Eric got hired on as a regular employee, instead of just a "seasonal temp," which is what he's been since April. What that means for us is that here in a few months he'll be eligible to start receiving benefits at work, provided he's working at least 30 hours a week.
That's a great step for our family, because his work has an insurance policy they offer with Blue Cross Blue Shield that's only $200 a month for the family. So we've got a viable option for health insurance on the horizon! Hooray!
Sorry for the bubbly excitement--this feels like a huge break for us in meeting our goal of getting off welfare in six months. Where before we were facing some pretty expensive options for coverage, now we're looking at a very reasonable amount that shouldn't break the bank. Add to that the happy fact that we only need to hold that coverage for a little over a year before Eric commissions and we get on Tricare, and you've got a recipe for some very doable budgeting!
While we're on the subject, I just wanted to say that the U.S. military has some great career options for broke people. Eric is going the officer route in the Air Force, because for him that's the branch that best fits his personality. His brother, however, has spent six years enlisted in the Army as a combat medic, and is equally satisfied with his job. I think both boys are planning to make a twenty-year career out of it.
In case you've never heard the military pitch, it's a pretty great way to get started, especially now when the recession makes finding a job right after graduation difficult. You get help paying for school and, in exchange, you have four years of guaranteed work after you graduate. While serving, you receive a decent amount of pay, plus you get perks like awesome health insurance, housing (or a housing allowance), and bonuses for things like being away from your family. In the Air Force at least, you can also get a generous bonus just for speaking another language, around $600 a month. If you speak two foreign languages you can be eligible to receive $1200.
Sure, the outright pay isn't amazing compared to the civilian world, but if you use the military to graduate without student loans and then gain valuable work experience before entering the regular work force, that can be a good deal. Or, if you find that you love it, the retirement plan is nothing short of awesome.
Of course, there are also a bunch of depressing drawbacks, but I don't want to get into those. My point isn't that the military is the absolute best choice for every person on the planet; rather, that it's a solid option for people looking to get themselves out of the hole.
But we've got plenty of time to delve into that further; after all, right now our biggest concern is getting off of welfare.
One thing at a time.
That's a great step for our family, because his work has an insurance policy they offer with Blue Cross Blue Shield that's only $200 a month for the family. So we've got a viable option for health insurance on the horizon! Hooray!
Sorry for the bubbly excitement--this feels like a huge break for us in meeting our goal of getting off welfare in six months. Where before we were facing some pretty expensive options for coverage, now we're looking at a very reasonable amount that shouldn't break the bank. Add to that the happy fact that we only need to hold that coverage for a little over a year before Eric commissions and we get on Tricare, and you've got a recipe for some very doable budgeting!
While we're on the subject, I just wanted to say that the U.S. military has some great career options for broke people. Eric is going the officer route in the Air Force, because for him that's the branch that best fits his personality. His brother, however, has spent six years enlisted in the Army as a combat medic, and is equally satisfied with his job. I think both boys are planning to make a twenty-year career out of it.
In case you've never heard the military pitch, it's a pretty great way to get started, especially now when the recession makes finding a job right after graduation difficult. You get help paying for school and, in exchange, you have four years of guaranteed work after you graduate. While serving, you receive a decent amount of pay, plus you get perks like awesome health insurance, housing (or a housing allowance), and bonuses for things like being away from your family. In the Air Force at least, you can also get a generous bonus just for speaking another language, around $600 a month. If you speak two foreign languages you can be eligible to receive $1200.
Sure, the outright pay isn't amazing compared to the civilian world, but if you use the military to graduate without student loans and then gain valuable work experience before entering the regular work force, that can be a good deal. Or, if you find that you love it, the retirement plan is nothing short of awesome.
Of course, there are also a bunch of depressing drawbacks, but I don't want to get into those. My point isn't that the military is the absolute best choice for every person on the planet; rather, that it's a solid option for people looking to get themselves out of the hole.
But we've got plenty of time to delve into that further; after all, right now our biggest concern is getting off of welfare.
One thing at a time.
Tuesday, October 26, 2010
Mechanical Turk? Doesn't Work.
Driven into a near-frenzy of boredom by bedrest, I decided to make an attempt to contribute to my family's income. After all, my screen is constantly being peppered by "work from home!" ads. My favorite is that one, "Learn how a single mother made 120.00 an hour!" Could that be me?!?! Doubtful. Let's be fair, here: if get-rich-quick schemes really worked that well we as a country would be seeing inflation rates into the thousand percents.
But I assumed that a few dollars an hour was reasonable; after all, I'm at least arguably literate, I have a Bachelor's in Psychology, and I type upwards of 70 wpm...surely there's something I could do to work from home!
That's how I found mechanical turk, amazon.com's answer to the work-at-home problem. I thought I'd love it: it's affiliated with amazon, one of my favorite companies, and you get paid directly into your amazon account for use on future purchases! Hooray! Since I buy pretty much every diaper to touch my son's bum on a quarterly sale from amazon, (haha, UPS guy!) this allows me to stock up on necessities just as though I'd bought them with real money.
However, after grinding away at mechanical turk, diligently, for two hours, what did I have to show for myself? About three bucks. Total. Even that would have been a welcome reprieve from the black hole of Youtube videos that would otherwise have taken up that time if it weren't for the constant war I had to wage against scammers.
See, the way mechanical turk works, in theory, is that businesses pay for you to perform micro-tasks for them. The idea is that, rather than paying one person to put in 300 minutes' worth of work, and pay them the normal rate for it, businesses can hire 300 people to do one minute's worth of work, and pay them next to nothing. For instance, I once spent around ten minutes rating the crack-iness of cracks in sidewalks that users had submitted pictures of to some website. Rather than waste tedious hours sorting the images themselves, the owners paid mechanical turkers to do it for them at an abysmal rate of $.05 per group of ten. Considering that each image had to be rated in several categories, including adding up the total lengths of all the cracks and guessing how long that crack would be compared to the width of the picture itself (relevance?) this "simple" task ended up taking around 3 minutes. Not long, but 3 minutes' work for $.05 comes to a whopping $1.00 an hour. Nobody's going to work for that kind of nothing, but a hundred people might be willing to sacrifice a couple of minutes for a nickel.
There are tasks that pay higher rates, like $2-$3 a pop, for jobs that sound legitimate. "Test our website," is a popular one, that asks you to fill in forms to "make sure they work." These tasks will almost always make some claim that they're "testing to make sure our system can screen out false data," followed by the request, "So provide your real information." Ha. Really? Let's think through that nugget of wisdom logically: if I were trying to make sure that my lie detector could test for liars, would I instruct every tester to speak nothing but the truth? No. Even if it correctly told me every time one of them was being truthful, I wouldn't know anything at all about its effectiveness, since part of being a detector is being able to distinguish between the two.
Follow one of these links to the website and you'll find yourself filling out offers for "OMG!!! FREE IPAD!" or something similar. Having your voicemail, inbox, and physical mailbox flooded with spam for the next decade=SOOOOOO not worth $3.00.
To make matters worse, Eric was at work the entire time that I was dodging spam bombs and sorting cracks for nickels, which meant that he earned the same amount as I did after about 15 minutes. All in all: next time I buy diapers they'll cost about a penny less per diaper thanks to my two hours of work, and now I feel even less contributory to the family than I did before.
Lesson to be learned: not all work-at-home gigs are scams, but for my time, I'd rather have a job.
If anyone needs me I'll be blurring the next two months into oblivion on Youtube.
But I assumed that a few dollars an hour was reasonable; after all, I'm at least arguably literate, I have a Bachelor's in Psychology, and I type upwards of 70 wpm...surely there's something I could do to work from home!
That's how I found mechanical turk, amazon.com's answer to the work-at-home problem. I thought I'd love it: it's affiliated with amazon, one of my favorite companies, and you get paid directly into your amazon account for use on future purchases! Hooray! Since I buy pretty much every diaper to touch my son's bum on a quarterly sale from amazon, (haha, UPS guy!) this allows me to stock up on necessities just as though I'd bought them with real money.
However, after grinding away at mechanical turk, diligently, for two hours, what did I have to show for myself? About three bucks. Total. Even that would have been a welcome reprieve from the black hole of Youtube videos that would otherwise have taken up that time if it weren't for the constant war I had to wage against scammers.
See, the way mechanical turk works, in theory, is that businesses pay for you to perform micro-tasks for them. The idea is that, rather than paying one person to put in 300 minutes' worth of work, and pay them the normal rate for it, businesses can hire 300 people to do one minute's worth of work, and pay them next to nothing. For instance, I once spent around ten minutes rating the crack-iness of cracks in sidewalks that users had submitted pictures of to some website. Rather than waste tedious hours sorting the images themselves, the owners paid mechanical turkers to do it for them at an abysmal rate of $.05 per group of ten. Considering that each image had to be rated in several categories, including adding up the total lengths of all the cracks and guessing how long that crack would be compared to the width of the picture itself (relevance?) this "simple" task ended up taking around 3 minutes. Not long, but 3 minutes' work for $.05 comes to a whopping $1.00 an hour. Nobody's going to work for that kind of nothing, but a hundred people might be willing to sacrifice a couple of minutes for a nickel.
There are tasks that pay higher rates, like $2-$3 a pop, for jobs that sound legitimate. "Test our website," is a popular one, that asks you to fill in forms to "make sure they work." These tasks will almost always make some claim that they're "testing to make sure our system can screen out false data," followed by the request, "So provide your real information." Ha. Really? Let's think through that nugget of wisdom logically: if I were trying to make sure that my lie detector could test for liars, would I instruct every tester to speak nothing but the truth? No. Even if it correctly told me every time one of them was being truthful, I wouldn't know anything at all about its effectiveness, since part of being a detector is being able to distinguish between the two.
Follow one of these links to the website and you'll find yourself filling out offers for "OMG!!! FREE IPAD!" or something similar. Having your voicemail, inbox, and physical mailbox flooded with spam for the next decade=SOOOOOO not worth $3.00.
To make matters worse, Eric was at work the entire time that I was dodging spam bombs and sorting cracks for nickels, which meant that he earned the same amount as I did after about 15 minutes. All in all: next time I buy diapers they'll cost about a penny less per diaper thanks to my two hours of work, and now I feel even less contributory to the family than I did before.
Lesson to be learned: not all work-at-home gigs are scams, but for my time, I'd rather have a job.
If anyone needs me I'll be blurring the next two months into oblivion on Youtube.
Friday, October 22, 2010
Day-to-Day Life for a Medicaidaire
Well, Eric's off to work. Poor guy. After a crazy busy week he's got a 7-3 shift at work, plus stadium cleanup after the football game. What a long ending to a long week!
I, meanwhile, am lazing about in bed, as usual. Sometimes it feels like I'll never get off of bedrest, even though I know in reality I've only got another two months--max! Still, I hate doing this. I hate watching my husband work himself to death with work and school, only to come home to an invalid wife and stir-crazy son!
We calculated it out and, just between work, school, Air Force, and church, he's out of the house for 61 hours a week. Then he still has to come home and do homework! Since credits are calculated based on expected hours of study/homework per week, and he's taking 15 credits, that takes him up to 76 hours of work/study a week. Meanwhile, my only contribution is gestation. Good thing I spent all that time getting a degree!
Seriously, though, I said that my goal for this phase was to be happy with where I am in life. I only wish that Eric and I could be contributing equally right now. But, even from bed, there are still ways I can contribute to the family's overall well-being. I read an awesome book, The Millionaire Next Door, which takes a look at the shared traits of millionaires in America today. It's a very interesting read, if you have time. Anyway, one of the things it stressed over and over throughout is that there are two ways of accumulating more money: increasing your income and decreasing your spending. Since very few people can offer themselves a pay raise, the most accessible of these is to decrease spending. Well, I can do that!
Grocery stores are a great place to start, in my opinion. One trick I've learned for making cheap meals is to use the "search by ingredient" option at allrecipes.com. This awesome feature lets you plug in whatever random medley of ingredients happen to be on sale at your local grocery store to pull up a list of user-submitted recipes that use them. For instance, when my local Sunflower Market (oh my GOSH, I love that store!) had an awesome sale going on both chickens and dates, I used this search to find a mouth-watering recipe for medieval chicken pie, which was utterly awesome and definitely on-budget.
Or, if you've got a specific recipe in mind, there's always the good ol' "round robin" technique: visit multiple stores! This also doubles as a fun date night if you've got a store that sells cheap-o ice cream cones on the list. Strolling through the aisles with your sweetie and a sweet makes for an enjoyable evening, if you're in the right mood!
Of course, on bedrest, I usually opt for the allrecipes option, because sending my husband out for a multiple-hour grocery trip isn't quite as fun when it's a honey-do list and not a joint venture. But still!
I also pay a daily visit to all my favorite haunts: slickdeals.net, 1saleaday.com, and craigslist to see if any items we need are on sale. These sites are tricky, and difficult to navigate without spending more than you intended, but they can also be great money-savers. For instance, yesterday I bought Christmas presents for three of my friends from gaiam.com, an eco-friendly store specializing in organic, natural fibers and yoga supplies. Though the environmentally-conscious tees usually cost as much as $42 a pop, I found a posting on slickdeals that brought them down to 3/$10. When I knew I wanted to get these gals some Christmas gifts anyway, slickdeals provided a great option!
Speaking of awesome deals, here's one I found in line with today's introspection on spending: amazon.com is offering the book "Living Rich by Spending Smart" as a free e-book for a limited time. For those of us spoiled college kids who came from better lives than we're now able to afford, this is a great tool for maximizing purchasing power.
Aside from those tidbits, though, I don't plan on spending any money today, so that's all I've got! Only a few months left to go before this baby comes--it can't happen soon enough for me!
I, meanwhile, am lazing about in bed, as usual. Sometimes it feels like I'll never get off of bedrest, even though I know in reality I've only got another two months--max! Still, I hate doing this. I hate watching my husband work himself to death with work and school, only to come home to an invalid wife and stir-crazy son!
We calculated it out and, just between work, school, Air Force, and church, he's out of the house for 61 hours a week. Then he still has to come home and do homework! Since credits are calculated based on expected hours of study/homework per week, and he's taking 15 credits, that takes him up to 76 hours of work/study a week. Meanwhile, my only contribution is gestation. Good thing I spent all that time getting a degree!
Seriously, though, I said that my goal for this phase was to be happy with where I am in life. I only wish that Eric and I could be contributing equally right now. But, even from bed, there are still ways I can contribute to the family's overall well-being. I read an awesome book, The Millionaire Next Door, which takes a look at the shared traits of millionaires in America today. It's a very interesting read, if you have time. Anyway, one of the things it stressed over and over throughout is that there are two ways of accumulating more money: increasing your income and decreasing your spending. Since very few people can offer themselves a pay raise, the most accessible of these is to decrease spending. Well, I can do that!
Grocery stores are a great place to start, in my opinion. One trick I've learned for making cheap meals is to use the "search by ingredient" option at allrecipes.com. This awesome feature lets you plug in whatever random medley of ingredients happen to be on sale at your local grocery store to pull up a list of user-submitted recipes that use them. For instance, when my local Sunflower Market (oh my GOSH, I love that store!) had an awesome sale going on both chickens and dates, I used this search to find a mouth-watering recipe for medieval chicken pie, which was utterly awesome and definitely on-budget.
Or, if you've got a specific recipe in mind, there's always the good ol' "round robin" technique: visit multiple stores! This also doubles as a fun date night if you've got a store that sells cheap-o ice cream cones on the list. Strolling through the aisles with your sweetie and a sweet makes for an enjoyable evening, if you're in the right mood!
Of course, on bedrest, I usually opt for the allrecipes option, because sending my husband out for a multiple-hour grocery trip isn't quite as fun when it's a honey-do list and not a joint venture. But still!
I also pay a daily visit to all my favorite haunts: slickdeals.net, 1saleaday.com, and craigslist to see if any items we need are on sale. These sites are tricky, and difficult to navigate without spending more than you intended, but they can also be great money-savers. For instance, yesterday I bought Christmas presents for three of my friends from gaiam.com, an eco-friendly store specializing in organic, natural fibers and yoga supplies. Though the environmentally-conscious tees usually cost as much as $42 a pop, I found a posting on slickdeals that brought them down to 3/$10. When I knew I wanted to get these gals some Christmas gifts anyway, slickdeals provided a great option!
Speaking of awesome deals, here's one I found in line with today's introspection on spending: amazon.com is offering the book "Living Rich by Spending Smart" as a free e-book for a limited time. For those of us spoiled college kids who came from better lives than we're now able to afford, this is a great tool for maximizing purchasing power.
Aside from those tidbits, though, I don't plan on spending any money today, so that's all I've got! Only a few months left to go before this baby comes--it can't happen soon enough for me!
How to Get Yourself on Welfare: Be Broke, No Matter What Your Circumstances!
Alright. So here we are. Square one. As I've already established, my family and I are broke. So what do we do now?
I hear from pretty much anyone who knows a quote that those who don't remember the past are doomed to repeat it. Sound advice, and exactly the right amount of ominous. Now, I know the circumstantial stuff that led to us being here, but what could we as a family have done better?
Here's a neat trick: up the average American's salary at a rate that outpaces inflation, and more than likely that American isn't going to change her savings plan even the teensiest bit. Why is that? Why doesn't every worker contribute enough to his 401k to maximize company matching?
Simply put, we're consumerist morons.
Come to my apartment complex and you'll see college students getting more hyped up about our local grocery stores' "Case Lot Sales" than most people get about the superbowl (unless Green Bay is playing, in which case, who can blame them?) These same students will unpack annual supplies of canned veggies, soups, mixes, and ramen noodles which must then be creatively stashed in our pantry-free, 650 sq. ft. apartments, then return to their 2008 toyotas to grab the black beans and spaghetti sauce that didn't make it inside with the first load. Really? You can't afford to buy regular-priced green chilies but you can afford a car better than most middle-class Americans drive?
Since my husband and I aren't made up of stone (or ramen noodles), we've done our fair share of keeping up with the Joneses, which has to be the single most unhealthy financial habit in America today. It is also, sadly, one of the most gratifying in the short-term. Step into our home and you'll find a slick new computer (which, to be fair, we built ourselves to save money), an unholy amount of baby clothes that our son fit into for all of two weeks, high-tech cell phones, and kitchen appliances that are more often used as toys than ice-cream makers. We're not any more immune than our neighbors, we just happen to have lucked out in terms of interest. Neither my husband nor I particularly care about our ride, which is a 99 chevy venture nearing the 200k mile mark. I'm not particularly interested in home decor, especially given that the lifespan on our current apartment is only another 18 months anyway. But I do love to cook, so I have kitchen toys. Eric loves to play with electronic gadgets. The only advantage we have over our less-frugal neighbors is that our interests don't happen to include many big-ticket items.
But the itch to spend is still there. It's difficult not to feel at times like we're trapped in our position in life, especially since both of us grew up in solid middle and upper-middle class families. I have a set of skis, which I own, jammed into the back of the closet, where they've been collecting dust since we moved here. Every once in a while, I think of how much I love to ski, and am seriously tempted to fork $40 over to a ski resort in exchange for a lift pass. I never have, but that temptation is frequently there.
What I've come to realize is that purchases like these are so inappropriate, not because of their inherent expense (after all, how much was that fondue pot I never use? Forty bucks? We're not talking about a bank-buster, here.) The problem is all in the relative expense. Let's suppose that my family's annual income is $20,000. That fondue pot then costs .2% of my total annual income. In other words, if I were to buy nothing but fondue pots, I could buy 500, and that would be my entire income for the year, gone. But now let's suppose that I live in an apartment that costs $600 a month. 600 x 12 is 7200. Utilities, clothing, gas, toiletries, car insurance, and other essentials total...let's say $300 a month, or $3600 a year. I'm not even going to count in food and health insurance, since, as you know, we get Medicaid and food stamps. If we never had a single other expense--if there were no unexpected car problems, no frivolities such as haircuts or eating out, no movie rentals or visits to out-of-town relatives--our total remaining income would be $9200. Our total purchasing power for the year would be 230 fondue pots.
But if someone with $40,000 were to buy nothing but fondue pots, they could buy 1,000. The relative price of the fondue pot is four times cheaper. Or, in another way of looking at it, if the person with $40,000 were to split their income into 230 equal purchases, they would be looking at an item with a $173 ticket. Our fondue pot is four times more expensive to us than it would be to this other person, even though on the shelves the two items are identically priced.
So, the first step in the process is to recognize that purchases, even little purchases, are more expensive to me as a sub-average incomer than they would be for someone else. That applies to everything from cars to ramen noodles. Therefore, the scope of purchases that we can make without thinking about is much narrower. You've heard the expression, "penny-wise and pound-foolish", right? Well, I feel that what constitutes "pennies" varies for each person. Have you heard the idea that it isn't time efficient for Bill Gates to stop to pick up a dropped $1000 bill, since in the amount of time it would take him he would have earned the money back already? Meanwhile, for me, it is very time efficient to spend hours a month plotting out which ingredients to buy at which grocery stores, based on weekly ads. Don't be fooled into thinking that you're only being "penny-wise" when the annual savings of buying on coupons account for 2% of your annual income.
All of that, though, means nothing if your attitude isn't in the right place. Have you ever tried to diet, only to fall prey to a night of binging on ice cream or french fries? Living grudgingly within your means is like that. Every time Ideny yourself an expensive purchase, it feels like a victory. I'll pass on the ski pass, I'll resist the siren's call of new speakers, or I'll will myself to buy extra-cheap shampoo. I'm doing great! And then...there's a fondue pot. Game over. Thanks for playing. All that self-discipline only served to build up my resentment for the spending diet, and I ended up buying something I might never have given a second thought to in the first place.
So if I'm going to break out of a spending mentality that's brought down a lot of better people than me, my first step has got to be accepting my station in life. I'm poor! Yep! That is a fact. I don't have to make apologies for it, or go crazy trying to make my life into something it isn't. If those crazies with their nice new cars want to whittle away their futures that way, that's their problem, not something for me to be envious of.
...In theory.
We'll see if that translates in practice over the next couple of weeks. I'll post a list of poor-in-cost, rich-in-feeling activities I've found help with the need to spend next Thursday.
Wish me luck!
I hear from pretty much anyone who knows a quote that those who don't remember the past are doomed to repeat it. Sound advice, and exactly the right amount of ominous. Now, I know the circumstantial stuff that led to us being here, but what could we as a family have done better?
Here's a neat trick: up the average American's salary at a rate that outpaces inflation, and more than likely that American isn't going to change her savings plan even the teensiest bit. Why is that? Why doesn't every worker contribute enough to his 401k to maximize company matching?
Simply put, we're consumerist morons.
Come to my apartment complex and you'll see college students getting more hyped up about our local grocery stores' "Case Lot Sales" than most people get about the superbowl (unless Green Bay is playing, in which case, who can blame them?) These same students will unpack annual supplies of canned veggies, soups, mixes, and ramen noodles which must then be creatively stashed in our pantry-free, 650 sq. ft. apartments, then return to their 2008 toyotas to grab the black beans and spaghetti sauce that didn't make it inside with the first load. Really? You can't afford to buy regular-priced green chilies but you can afford a car better than most middle-class Americans drive?
Since my husband and I aren't made up of stone (or ramen noodles), we've done our fair share of keeping up with the Joneses, which has to be the single most unhealthy financial habit in America today. It is also, sadly, one of the most gratifying in the short-term. Step into our home and you'll find a slick new computer (which, to be fair, we built ourselves to save money), an unholy amount of baby clothes that our son fit into for all of two weeks, high-tech cell phones, and kitchen appliances that are more often used as toys than ice-cream makers. We're not any more immune than our neighbors, we just happen to have lucked out in terms of interest. Neither my husband nor I particularly care about our ride, which is a 99 chevy venture nearing the 200k mile mark. I'm not particularly interested in home decor, especially given that the lifespan on our current apartment is only another 18 months anyway. But I do love to cook, so I have kitchen toys. Eric loves to play with electronic gadgets. The only advantage we have over our less-frugal neighbors is that our interests don't happen to include many big-ticket items.
But the itch to spend is still there. It's difficult not to feel at times like we're trapped in our position in life, especially since both of us grew up in solid middle and upper-middle class families. I have a set of skis, which I own, jammed into the back of the closet, where they've been collecting dust since we moved here. Every once in a while, I think of how much I love to ski, and am seriously tempted to fork $40 over to a ski resort in exchange for a lift pass. I never have, but that temptation is frequently there.
What I've come to realize is that purchases like these are so inappropriate, not because of their inherent expense (after all, how much was that fondue pot I never use? Forty bucks? We're not talking about a bank-buster, here.) The problem is all in the relative expense. Let's suppose that my family's annual income is $20,000. That fondue pot then costs .2% of my total annual income. In other words, if I were to buy nothing but fondue pots, I could buy 500, and that would be my entire income for the year, gone. But now let's suppose that I live in an apartment that costs $600 a month. 600 x 12 is 7200. Utilities, clothing, gas, toiletries, car insurance, and other essentials total...let's say $300 a month, or $3600 a year. I'm not even going to count in food and health insurance, since, as you know, we get Medicaid and food stamps. If we never had a single other expense--if there were no unexpected car problems, no frivolities such as haircuts or eating out, no movie rentals or visits to out-of-town relatives--our total remaining income would be $9200. Our total purchasing power for the year would be 230 fondue pots.
But if someone with $40,000 were to buy nothing but fondue pots, they could buy 1,000. The relative price of the fondue pot is four times cheaper. Or, in another way of looking at it, if the person with $40,000 were to split their income into 230 equal purchases, they would be looking at an item with a $173 ticket. Our fondue pot is four times more expensive to us than it would be to this other person, even though on the shelves the two items are identically priced.
So, the first step in the process is to recognize that purchases, even little purchases, are more expensive to me as a sub-average incomer than they would be for someone else. That applies to everything from cars to ramen noodles. Therefore, the scope of purchases that we can make without thinking about is much narrower. You've heard the expression, "penny-wise and pound-foolish", right? Well, I feel that what constitutes "pennies" varies for each person. Have you heard the idea that it isn't time efficient for Bill Gates to stop to pick up a dropped $1000 bill, since in the amount of time it would take him he would have earned the money back already? Meanwhile, for me, it is very time efficient to spend hours a month plotting out which ingredients to buy at which grocery stores, based on weekly ads. Don't be fooled into thinking that you're only being "penny-wise" when the annual savings of buying on coupons account for 2% of your annual income.
All of that, though, means nothing if your attitude isn't in the right place. Have you ever tried to diet, only to fall prey to a night of binging on ice cream or french fries? Living grudgingly within your means is like that. Every time Ideny yourself an expensive purchase, it feels like a victory. I'll pass on the ski pass, I'll resist the siren's call of new speakers, or I'll will myself to buy extra-cheap shampoo. I'm doing great! And then...there's a fondue pot. Game over. Thanks for playing. All that self-discipline only served to build up my resentment for the spending diet, and I ended up buying something I might never have given a second thought to in the first place.
So if I'm going to break out of a spending mentality that's brought down a lot of better people than me, my first step has got to be accepting my station in life. I'm poor! Yep! That is a fact. I don't have to make apologies for it, or go crazy trying to make my life into something it isn't. If those crazies with their nice new cars want to whittle away their futures that way, that's their problem, not something for me to be envious of.
...In theory.
We'll see if that translates in practice over the next couple of weeks. I'll post a list of poor-in-cost, rich-in-feeling activities I've found help with the need to spend next Thursday.
Wish me luck!
Thursday, October 21, 2010
Let's start at the very beginning...
Some people are rich. Some people are not. My family and I are very, very not.
In fact, as of this writing, we're among the elite group of Americans known as "freeloading scumbags" who rely on welfare to get through the month. Welfare. What an awful word that has become. Just the sound of it makes me want to spit, like there's something dirty in my mouth.
Pretty much everyone on welfare can tell you their compelling personal story of hardship, and how it excuses them from feeling guilty. I won't bother, because A) if your reaction is to think my family and I should be deported to some other country where we can learn what it means to work for a living, nothing I can say will convince you anyway, and B) I feel horrendously guilty.
The worms-in-my-liver feeling of guilt is what I'd like to focus on first.
I have a Bachelor's degree in Psychology, which I just received in August. My final G.P.A. was a 3.74. While in college, I got married, got pregnant (fyi: morning sickness + morning classes do not a fun semester make), and had a baby. I also worked 20 hours a week for a good portion of my college career, and always worked full-time during the summers. At first that meant waitressing; later I worked retail and then got into installing (NOT selling--I was actually operating power tools) security systems. In short, I went where the money was, and worked hard.
Before that I was in high school, where I took enough AP classes to start college as a sophomore. I was president or vice president of at least five clubs, and heavily involved in eight or nine. Heck, some clubs (and even classes), only existed because I petitioned them into being. Oh, and also, I placed first in a national speaking competition. And graduated three weeks after turning 17. Since this is crossing into bragging, let me get to the point of it all: for my entire life, I've been an over-achiever. I work hard. I make things happen. You can blame my parents, and their zero-tolerance policy of "Don't be a victim of circumstance." Meaning that no matter what the world throws at you, use your own human resourcefulness to rise above it.
You get the idea: be proactive. Take initiative. Oh, and also, wind up on Medicaid and food stamps when you're twenty-two. Wait--what?
I told you I won't bore you with the details that led to my pitiful mooch-fest here. I'll let that unfold gradually to those poor souls who decide to follow the rest of my blog. But I hope you can glean from the last few paragraphs that ending up on welfare is so far off the radar of things I had planned for my life, it's not even in the same galaxy.
That said, I have "Don't be a victim of circumstance" stuck in my head harder than the hampster dance. So even though we've fallen on hard times, I am going to make an arrogant, lofty claim.
My husband and I will be millionaires someday.
We're going to do it for three reasons. Firstly, we want the financial freedom. I don't ever want to be thrust into poverty by life circumstances ever again. From here on out, we are moving uphill. I don't care if that means army-crawling there through mud and dog poop, we are going to make it.
Secondly, this is America. If there were ever a place where people with nothing could rise up from the ashes to become wealthy, contributing members of society, this is it. Some pessimists say it isn't possible. To them, I'd answer, "I AM RUBBER, YOU ARE GLUE." But then after the furious blushing, I'd probably--hopefully--direct them to my blog, where eventually I hope to have a well-documented record of my path out of poverty.
Lastly, I want to set an example. There are a lot of good people out there on Medicaid, believe it or not. Some, like me, are soulless demons, but some of them are actual people with hearts and plans and crushingly awful circumstances. Maybe if I can show that you don't need a lucky break to get back on your feet, I can balance out the strain my family and I have placed on society these last several months.
That's the plan, anyway. If I don't make it to a million in time to retain anybody's interest, at least I hope to show that I'm on the right track. It's all in good fun, anyway.
But that's the goal. Right now, my family would be in a hellish financial freefall without welfare; step one will be for us to be off it within six months. Feel free to follow along, point and laugh, or even just shake your head at the ludicrosity of it all.
In the meantime, I welcome your comments! Talk to you soon!
In fact, as of this writing, we're among the elite group of Americans known as "freeloading scumbags" who rely on welfare to get through the month. Welfare. What an awful word that has become. Just the sound of it makes me want to spit, like there's something dirty in my mouth.
Pretty much everyone on welfare can tell you their compelling personal story of hardship, and how it excuses them from feeling guilty. I won't bother, because A) if your reaction is to think my family and I should be deported to some other country where we can learn what it means to work for a living, nothing I can say will convince you anyway, and B) I feel horrendously guilty.
The worms-in-my-liver feeling of guilt is what I'd like to focus on first.
I have a Bachelor's degree in Psychology, which I just received in August. My final G.P.A. was a 3.74. While in college, I got married, got pregnant (fyi: morning sickness + morning classes do not a fun semester make), and had a baby. I also worked 20 hours a week for a good portion of my college career, and always worked full-time during the summers. At first that meant waitressing; later I worked retail and then got into installing (NOT selling--I was actually operating power tools) security systems. In short, I went where the money was, and worked hard.
Before that I was in high school, where I took enough AP classes to start college as a sophomore. I was president or vice president of at least five clubs, and heavily involved in eight or nine. Heck, some clubs (and even classes), only existed because I petitioned them into being. Oh, and also, I placed first in a national speaking competition. And graduated three weeks after turning 17. Since this is crossing into bragging, let me get to the point of it all: for my entire life, I've been an over-achiever. I work hard. I make things happen. You can blame my parents, and their zero-tolerance policy of "Don't be a victim of circumstance." Meaning that no matter what the world throws at you, use your own human resourcefulness to rise above it.
You get the idea: be proactive. Take initiative. Oh, and also, wind up on Medicaid and food stamps when you're twenty-two. Wait--what?
I told you I won't bore you with the details that led to my pitiful mooch-fest here. I'll let that unfold gradually to those poor souls who decide to follow the rest of my blog. But I hope you can glean from the last few paragraphs that ending up on welfare is so far off the radar of things I had planned for my life, it's not even in the same galaxy.
That said, I have "Don't be a victim of circumstance" stuck in my head harder than the hampster dance. So even though we've fallen on hard times, I am going to make an arrogant, lofty claim.
My husband and I will be millionaires someday.
We're going to do it for three reasons. Firstly, we want the financial freedom. I don't ever want to be thrust into poverty by life circumstances ever again. From here on out, we are moving uphill. I don't care if that means army-crawling there through mud and dog poop, we are going to make it.
Secondly, this is America. If there were ever a place where people with nothing could rise up from the ashes to become wealthy, contributing members of society, this is it. Some pessimists say it isn't possible. To them, I'd answer, "I AM RUBBER, YOU ARE GLUE." But then after the furious blushing, I'd probably--hopefully--direct them to my blog, where eventually I hope to have a well-documented record of my path out of poverty.
Lastly, I want to set an example. There are a lot of good people out there on Medicaid, believe it or not. Some, like me, are soulless demons, but some of them are actual people with hearts and plans and crushingly awful circumstances. Maybe if I can show that you don't need a lucky break to get back on your feet, I can balance out the strain my family and I have placed on society these last several months.
That's the plan, anyway. If I don't make it to a million in time to retain anybody's interest, at least I hope to show that I'm on the right track. It's all in good fun, anyway.
But that's the goal. Right now, my family would be in a hellish financial freefall without welfare; step one will be for us to be off it within six months. Feel free to follow along, point and laugh, or even just shake your head at the ludicrosity of it all.
In the meantime, I welcome your comments! Talk to you soon!
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