financial zen

Very often I come across articles and bloggers writing about saving money in college. It’s beating a dead horse. It’s the same “tried-and-true” advice time after time. It’s written by people on the outside, looking in. Former students. Graduated professionals.

What? Things have never changed? The same rules apply?

I’m sorry to break it to everyone, but people love to generalize the college experience. They want to trivialize the details - so let’s try and break it out for you:

Rule #1 - Scholarships aren’t a sure thing.
Yes, you can apply until your fingers are numb. But you can’t rely on this type of cash to sustain you, or fulfill your “life-long college dream” choice. I’m not saying don’t apply, I’m saying don’t listen to all the hub-bub about Loans are the devil, you’ll be in debt forever, etc…

Rule #2 - Loans are an excellent tool.
People will moan about paying off their student loans (even more so when they drop out without finishing). Education that is worth money, will cost money. But my question to you is - do you need to take your first two years of classes at the expensive place? My suggestion to you is to research community colleges - some offer “transfer” degrees to institutions - you take the general education classes at community college, save yourself a few grand, and then go drop the big bucks on your Bachelor’s Degree. You’ll save money in more than one way.

Rule #3 - Diversify your food.
Ramen seems to be called the staple of the college diet. Yes, it’s cheap. Yes, it’s not necessarily the healthiest option. My suggestion to any kid in college that lives in or around the campus - find out where the deals are. Dollar tacos? Half-off specials? These places are prime for cheap, good eats (often rivaling the price of making it yourself) - plus they come with the added bonus that you get to hang around your class-folk. People under estimate the value of networking at any stage of college.

It’s equally important to recognize that while you are in college, brand name foods may not be worth their price tag. Generic vegetables all taste the same. Some things you may not want to skimp on - peanut butter, perhaps. Maybe you like a specific kind fo salad-dressing. The point is - don’t splurge on everything except the few items you’ve grown to love (or no generic has been able to match - yet).

Rule #4 - Drink - in moderation.
This is another key networking tool - when used wisely. Boys and girls, know your limits. No one likes the excessively drunk kid. No one likes taking care of the drunk. If you choose to drink in college - pace yourself, don’t give in to peer pressure, and when you call it quits - mean it. I’ve had to help too many people out when they “couldn’t say no” to one more drink. Leaving the party “too sober” is never followed by a story involving drunken accidents, bad one-nighters, or illness.

Rule #5 - Put off new purchases.
I love following this one after the drinking issue. I’ve met a few guys who would buy a brand new outfit (occasionally on credit, occasionally on the allowance their parents give them) and then go out drinking, get too drunk, or are too uptight about “getting dirty” that they come off very stand-offish to everyone. You can get good clothes on sale (or at Good Will, or thrift stores). You really do not need the hottest fashions unless that’s your major (but if you’re a fashion designer, you should be MAKING the hot new things, not buying someone else’s). Guys - seriously, do you need designer jeans? That impresses only people who are concerned if you can buy them expensive things.

You won’t always win.
Just as a quick wrap-up, sometimes, you’re going to lose. You may get an F for the first time ever. You may have a teacher or a class that you just can’t conquer - but that’s reason to talk out, to discuss, to speak up. Break old bad habits - being shy never helps, and in a room full of people that aren’t talking, chances are they’re as shy as you. I’m still trying to crack this shell in myself.

The point is - you can spend cash. you can work part-time. You can work full-time and go to school full-time - I’m doing it for almost a year straight. I’m on the Dean’s list. think about the short-term (community college) along with the long-term (where you’re going afterwards).

Actually, perhaps that’s a better point. Just think. Think about yourself, your education, your money, your future. Think about how you’d want to tell your kids about the kind of life you *really* lead in college - the person that had a few beers, was a regular on $1 taco night, and still pulled a B average, or the locked in the dorm room, stressed straight-A student? When you graduate, it could be the people you made friends with that land you your job (or a future one). They’re not going to care tha tyou didn’t carry a 4.0. They’re going to care you took the time to get to know them.

Good luck, college kiddos, I’m in the grind with you and I know it’s not getting easier - but I know it’s definitely worth it.

So nickel had an interesting article, comparing the definitions of frugal and cheap. Unfortunately, the examples are rather lacking.

So let’s take it up a notch - instead of HotOrNot why not “frugal or not?”

Take for instance, store brands. We know Del Monte, Chiquita, Pepsi, Coke (once Ohio State’s savior, now a harsh reality check), Jif (the choice of choosy moms) and a number of other brands. Can you taste the difference?

Honestly, there are a few choices that I have “gone frugal” on, and never will again. One of them is Peanut Butter. I bought generic once - and never again. It still amazes me that the taste can be so different. Vegetables, however, I can’t tell the difference - as with canned fruit. If it’s not fresh from the farmer (I’m working on it!) - it all tastes the same. I buy cheap.

Another recognition that “image from purchase” problem - I was once told that low-income families would be envious of the family that fed their children formula. Breast feeding is better, and recommended. Why do they go the more expensive route?

For the appeal of being seen buying and using formula. It doesn’t matter that it isn’t better, but to be seen spending that extra cash makes you look “rich.”

The point is - we’re presented with options all the time. Name brand this vs. generic that. The “appeal” of being seen wearing (or buying) that name-brand item or hottest fashion, instead of the functional, or the old or the worn. C’mon - sometimes, it’s okay to splurge. Sometimes, that endorphin boost is worth the price tag for those new shoes, that new shirt, whatever. Moderation is key!

It’s important to recognize that you don’t need to give up everything in difficult times - but recognize where your money is going, and why you’re buying it.

Due to the passing of my Grandmother, I’m finding myself in the midst of receiving an inheritance.

I’m currently looking at speaking to a lawyer about this, as the sum is substantial enough to warrant looking at protecting it. I’m forced to imagine Shawshank Redemption:

Mr. Hadley, do you trust your wife? [Hadley threatens to throw Andy off the roof] Because if you do trust her, there’s no reason you can’t keep that thirty-five thousand…If you want to keep all that money, give it to your wife. The IRS allows a one-time only gift to your spouse for up to sixty thousand dollars…tax-free…you do need someone to set up the tax-free gift for ya, and it’ll cost ya, a lawyer for example…I suppose I could set it up for ya. That would save you some money. You get the forms, I’ll prepare them for ya, nearly free of charge.

-wikiquote

Thankfully, someone at work has pointed out a lawyer to speak to. My mission this week is to find out all I can about inheritance laws and taxes!

I’ve been busy reading like crazy - books for work, books for school, books of interest - and it’s made me dwell on the thoughts of why I maintain blogs. I essentially own two - one for code and pop culture with two good friends, and this one.

I started Financial Zen because of a post I saw a post about starting a personal finance blog back when I wanted to et more active in writing - of course, all before the idea of being a father came in to play. I chose the name because I was getting into Buddhism, and also starting to read up on Ben Franklin and his 13 virtues. It lead me to thinking about becoming a better person, and who better to model yourself after? A spiritual person, and a founding figure of this country, who modeled himself in the idea of Jesus and Socrates?

Of course, this all changed when my son was borned. It made me think about it ten-fold if not more! Having a child just made me want to grow to be a stronger person then before - a role model, if you will, in this day and age of “celebrity” role-models where kids are looking at the famous to get their ideas and morals from (which is a tough act to compete with). It’s a main goal - one that surpasses personal finance and more-so focuses on being a good person - which is ultimately the goal of this blog, to track my progress - not just on becoming financially stable - but on becoming stable and strong in all aspects of life. In the coming months (and years) I hope anyone that stumbles upon my writings feels the same.

Mrs. Zen and I have long been battling the decision of a dual income, or having her be a stay at home mom. As much as I’d love to be a stay at home dad, I’m the main bread winner - her income is basically pure profit, free to spend as we desire (and mind you, it’s going towards debt reduction). We recently traded in my 1996 Honda Civic for a 2005 Honda CRV - mainly because we had the extra income to do a large down payment, and trips to Grandma and Grandpa’s with packed bags, stroller, and dog in tow. Once in the Civic was enough - and with a dual income we could more than afford a new(er) car.

As was pointed out - the after tax and childcare income is about 13k. But let’s make some adjustments:

Our childcare is about $2,340 due to our baby-sitter service. We only use them for one day a week - for now. If Mrs. Zen becomes full-time salaried, that will change, but no matter how you look at it - her additional income is after all bills are paid.

Let’s tackle their considerations:

• Career Advancement Goals - There is *always* more to a career than money! What about happiness? Mrs. Zen desires a career in paramedicine - she enjoys staying at home, but she also loves her work (as do I!)
• How to Return To Work? - I can’t really argue this one - leaving for eyars ad coming back in - that’s potentially ‘resetting’ your career unless you continue your work part-time.
• Extra Expenses - I’ve got to agree - working has expenses, just as staying at home. If no one is home, the heater/AC is off, less electricity, and at work you may have “job functions’ - happy hours, lunches and the like (I *DO* consider these essential - I owe my current job due to lunch-time networking! And pizza.)
• Breadwinner May Become Workaholic Career Freak - C’mon, really? This is a personal thing, and if you can’t balance your career and life, you need to reassess your values.
• Coupon Clipping - I’ve got mixed feelings here. My brother-in-law works from home (ebay business) and is an excellent father and cooks, while also shopping at night. He’s thrifty and is business than some other people I know. Coupon clip, regardless, I say.
• Schools - This is something I’m still looking into. I moved into a certain area for its reknowned public schools - you can send your kids to a private school so that by the age of six they know three languages and a head start on other students. Do you really want to make your kid go through that? You’ve got to focus on your kids being kids and not being “intellectual geniuses” or “young athletes” - they’re not here to live out your dreams. Do what you can to provide, but don’t force your kids to be something other than children.

Now the stay-at-home parent conundrum is an interesting one - I’ve talked to work-at-home, stay-at-home and day-care parents, with plenty of pros and cons. Your children need you to be their parent, but htey also need to develop social skills and learn to go out on their own - not developing an attachment on you, needing you for everything. I’m a parent, and the wife and I are working on him not developing separation anxiety, but I’m still reading on the psychology of it all (which is a never ending quest!)

We all have had it happen - we’ve hit those little dips in life. That point where we need to decide - should I stay or should I go?

Thanks to ten questions with Seth Godin from Guy Kawasaki he helps point out that these are the moments you really need to look at:

1.Question: Other than hindsight, how does someone know when it’s time to quit?

Answer: It’s time to quit when you secretly realize you’ve been settling for mediocrity all along. It’s time to quit when the things you’re measuring aren’t improving, and you can’t find anything better to measure.

Smart quitters understand the idea of opportunity cost. The work you’re doing on project X right now is keeping you from pushing through the Dip on project Y. If you fire your worst clients, if you quit your deadest tactics, if you stop working with the people who return the least, then you free up an astounding number of resources. Direct those resources at a Dip worth conquering and your odds of success go way up.

What’s the worst time to quit? When the pain is the greatest. Decisions made during great pain are rarely good decisions.

I won’t spoil the rest - it’s an interesting look at that introspective process when the times get tough - not just for businesses, but in careers and education.

The best time to ask this question (should I quit in the middle of a dip) is before you hit the Dip. Smart people can see Dips in advance and plan for them. If you want to be a doctor, the time to decide is before you get to the organic chemistry midterm, not while you’re taking it.

Great read from a great blog - I may have to pick up a copy from the library (after it’s released, I mean).