My Best Advice for 2009

Speaking of stairs, you know how walking down the stairs is kind of just something you do and not something you have to actually think about; like breathing? Have you ever thought about it while you're descending the staircase? Well, don't. Once you start picturing left foot, right foot, next step; it will jack you up bad. Wicked bad. And you look pretty dumb when it becomes obvious you've forgotten how to walk down stairs.

Not that I would know anything about that.

YFNN

I Think My Dog is Trying to Kill Me

My dog, cute and wonderful as he is, is trying to kill me. Or at least watch me sprawl on the ground in pain.

You see, he's got this thing where he needs to be precisely where I am at all times (unless he's actively trying to kill my wife by the same means at that moment in time). When groceries are being brought in from the car and put away, he's in the doorway to the kitchen. When dishes are being done, he's between me and the dishwasher. When I'm on the couch, he insists on laying on the floor where my feet will go when I get up. When I get out of the shower, he's there.

[Aside: Personally, I think he likes seeing me naked, but doesn't want to admit it. Every time I catch him looking at me right out of the shower, he does this thing where as soon as we make eye contact, he looks away and pretends he didn't notice me there. ]

Fortunately for me (and him) my cat-like agility (do you smell burning pants?) allows me to maneuver around him most times, avoiding a loud and likely painful trip to floor. My little hop, hop, big step, shuffle usually prevents me from stomping on him as he lays unwavering on the floor. If, by chance, I do happen to clip his tail or leg while dancing around him, he sits up, looks at me all appalled, like I'm the a-hole. Um, you're the one laying under the footrest of the recliner, jerk.

I'm pretty sure his preferred method of attempted murder is the stairs. As I approach the top of the stairs (to go down), he will actually wait behind me until I'm on the second or third step before he tries to rush past in an attempt to send me to my clumsy demise. If I happen to walk down the stairs after him, he'll try too. I'll be going along at a pretty good clip right behind him and he will suddenly stop. Just BAM! Stop. And I have to grab onto the wall to keep from going ass over melon over him and down the stairs.

So, if any of y'all ever find me dead at bottom of the basement stairs and Dempsey with an aloof-yet-guilty look on his face, you'll know really happened.

[Aside #2: Yes, that's him at the top of this post, there. Can you see the demons in his eyes? And yes, as his shirt states, he is indeed "bossy beyond belief".]

YFNN

Third Trimester Thoughts

My lovely wife is in the third trimester of her pregnancy (I won't even attempt to say our pregnancy...I'm not doing anything compared to her). On the general schedule of growing humans from scratch, that means she's just about finished. A couple more months, and we'll have a living, breathing, helpless person relying on us for everything. A bit scary.

The baby inside her apparently isn’t too well-versed on concepts like "day" or "night", so he'll kick whenever he damn well pleases. What this means is that wife never knows when she's going to get a swift kick to the spleen or bladder, usually resulting in a groan, moan, or grunt. Could be during a lovely dinner at a lovely Italian restaurant like Luce, or in the middle of a deep sleep. Baby doesn't care; he just knows he's gotta stretch out a bit.

Alien kicks. What's interesting to me (and uncomfortable to her) is that no longer can you only feel the kicks when you place your hand on her belly, you can actually see them. It not unlike that scene in the alien movie when the guys chest bulges and pulsates right before the alien busts on out. There have been times when I would swear that I saw the outline of a foot pushing on her belly from the inside. It's disturbing actually.
Pee. Every day is all about peeing for her. Before we leave the house, she pees. When we get to the restaurant, she pees. Before we leave, she pees. Getting showered and dressed sometimes requires up to three pee breaks. Even just making it through the night with only two pee breaks is a huge exercise in willpower and endurance. Fortunately, (and maybe I'm assuming too much here) all of the pants she wears now are stretchy and without buttons and zips...even the jeans. I would certainly think that would help drop the events down on the "pain in the rear scale".

Nesting. I had no idea. Seriously, no idea. The instinct to prepare is absolutely unbelievable. Suddenly, walls need painted, furniture needs moved, carpets need cleaned, closets need sorted, and there are constant ambiguous references to "getting ready." She's still got 8 weeks to go, and I'm already getting interrogated about packing for the hospital.

Emotions. It's like someone took her emotion output and amplified it ten fold. When she laughs, she laughs until she has tears in her eyes and her stomach hurts. When she cries, it's for silly reasons, and is as intense as I've ever seen. Certain foods make her dance in her seat, and disappointments crash her for the entire day. A rollercoaster? You betcha.

Words. This is probably the part that has shocked me the most. My wife has completely lost her grasp on the English language. Like a toddler with a 100-word vocabulary, she can never seem to find the right words to convey what she's trying to say. Ridiculous substitutions are common, and I'm usually at a loss to understand what she means. Usually I stare at her blankly as she frustratedly struggles to better define her intent. Examples? No problem.

She recently wanted to know if the basket of dinner rolls was still on the table from dinner, so she asked me "Is the bread-bun-pot still available?" What? Huh? Bread-bun-pot?

Or when she wanted me to put the dirty towels in the hamper last night, I was asked to "Please correctly place them in the roughrider." Yes, the roughrider. If you had an armful of towels and someone asked you to "correctly place them in the roughrider", you'd do what I did: stare blankly at them.

I can't tell you how many times she's been frustrated with me when I don't understand what she's talking about. Any and all paperwork is refered to as "information", regardless if it's a bill or a christmas card. She often refers to "the thing" and makes ambiguous hand gestures. What makes it even more difficult is that I find it so cute and endearing. It's nigh-impossible to keep from giving her a hard time about it.

So what's my role in this whole ordeal? Well, near as I can ascertain, it's my job to perform arbitrary organizational tasks, interpret the language of a crazy person, perform as a helping hand for getting out of cars and sofas, and exercise lots and lots of compassion and patience. And, I'm trying. I know that the frustrations I have to deal with are NOTHING compared to her daily ordeals.

What's Your Corporate Jet?

Earlier this month, the three CEOs from Chrysler, Ford, and GM were summoned to Washington, D.C. to explain their situation and beg for some good ol' taxpayer cash. Three companies. Three jets. Three CEOs. Begging for cash. Three people. Three jets. Anyone else see a problem?

Gary Ackerman (D-N.Y.) really nailed the sentiment:

"There's a delicious irony in seeing private luxury jets flying into Washington, D.C., and people coming off of them with tin cups in their hands," "It's almost like seeing a guy show up at the soup kitchen in high-hat and tuxedo. . . . I mean, couldn't you all have downgraded to first class or jet-pooled or something to get here?"

These big-three CEOs got in front of congress, whined and complained about how high expenses are, how much they're hurting, and how badly they need government money, all the while ignoring the ridiculous luxury expenditures they authorize and enjoy. This is an extreme example to be sure, but I'm willing to bet that we've all got a "corporate jet" in our own personal finances.

It's that one luxury item that we've started to take for granted. It's the expenditure that while expensive and unnecessary, we just don't give it up, even if money is tight. Maybe it's the satellite TV with premium channels that stays activated while you miss credit card payments. Maybe it's the high-dollar cell phone plan you maintain while you contemplate bankruptcy. Maybe it's the case of beer that's purchased while you struggle to buy groceries.

With tough economic times here for some, maybe it's time to evaluate your expenses and see what can be pared back or eliminated, before you start whining about your plight.

Harsh, but true.

YFNN

The Latest Dance Craze!

Ultrasounds are funny things. The pictures are great and all, but the real treat is the live video, especially if the little guy is moving around.

It all looks like a pathetic attempt at doing the YMCA dance.

Don't worry though, I'm sure the wife (or maybe my mother-in-law!) will teach him the correct way once he leaves the her belly.

YFNN

Changes, or a Complete Lack Of Them

The following post is a YFNN rant. You may find it offensive, crude or just plain wrong. Get over it.

How many times did we hear from now-President-elect Obama that the Iraq war is poorly run, full of bad management decisions, and going horribly? All the time.

So, in order to rectify that problem, he sticks with the same guy that's been running it the whole time: Robert Gates.

In his cabinet so far, he's picking old school Dems that have been around Washington for years (Daschle, Clinton, Waxman...seriously?) and now keeping the existing Secretary of Defense, who's been the target of immense amounts of hatred from his own mouth.

Yessiree, Barack, you are definitely change we can believe in.

YFNN

Life Insurance is Cheap!

I cannot believe how cheap term life insurance is. Seriously cheap.

With the new baby on the way in a couple of short months, and my lovely bride now at home full-time, we decided that a larger life insurance policy was an absolute necessity. Before, when it was just the two of us, and we were both working, it was acceptable for us to carry minimal life insurance. We both only carried what our employers provided (two year's salary in both cases). That was plenty because neither of us was completely dependant on the other's salary to get by. If I died, she could have carried on with just her salary, and I could have done the same if she died.

But, with a baby coming, life insurance got vitally important. So we searched out some level term policies to make sure my wife and child could live comfortably if I passed, and I could get by if she passed.

There are lots of "rules of thumb" when it comes to the amount of insurance to get. Kiplinger's, CNN's Money magazine, Smart Money, etc., all have some really good guidelines. To get to my number, I used the 8-12 times my annual salary estimate. This way, the house would be paid off, and the wife and child could pay for college and still live comfortably (albeit not without some changes) for a long time. One million dollars covered us more than acceptably for my policy.

For my wife's policy, we elected to get a much smaller amount. When she's working, she makes less than I do, so we're much less dependent on her income than mine. Since she won't be working (for a while, anyway), we won't be dependent on her income at all. So, basically, the amount just had to cover childcare costs so that I could continue to work and get an income. We settled on a $250,000 policy for her.

For terms, we decided on a 30-year term for me and a 20-year term for her. Since this life insurance is so inexpensive for me right now, we felt it made sense to lock in my rate for 30 years. Granted $1,000,000 won't be worth as much in 30 years, but my health likely won't be as good when I'm 60 and getting insurance may be tougher. With a 30-year policy, I'm covered until our son is WELL out of college, and covered farther in case we decide to have more children.

For my wife's policy, since it's mostly about covering childcare costs, a 20-year policy seemed more than adequate. 16-20 year olds don't need day care.

So exactly how cheap were these policies? Well, since we're both fairly young (30-ish) and in good health (her moreso than me), they were really cheap. My 30-year, $1,000,000 policy was only $800 a year, and her 20-year, $250,000 policy was only $140 a year.

Unbelievable.

For more information on insurance policies and such, here's my recommended reading:

The Simple Dollar
Free Money Finance
Free Money Finance Again!

YFNN

Controlling Junk

A few nights ago, my lovely wife and I purged some junk from our living room. Accumulation of meaningless stuff has always been a constant problem. It's incredible how stuff just starts to accumulate. You pick up a brochure here, get a catalog there, and before you know it, you've got a whole trash bag full of things to recycle or throw away.

The major issue with us is paperwork and such. With my wife recently getting laid off, we're getting inundated with paperwork for COBRA, severance payouts, investment rollovers, and unemployment information. And, that's on top of our standard mail of business magazines, political advertisements (thank God that's over), and regular bills and mail. The real problem is that we don't want to deal with it as it comes in. I don't want to file that COBRA paperwork away since I haven't gone through it yet (and don't want to forget about it), but I don't have the time or desire to deal with yet, either. The same thing happens with day care brochures, unread magazines, and other important but not-time-sensitive materials. So, it stacks up. Typically on our dining room table or the small table behind the sofa.

What to do? Well, the real solution is to take care of that junk immediately, as soon as it comes in the house. I do okay with some items. Junk mail and most catalogs quickly meet up with the recycling bin, and vitally important items are dealt with promptly, but dealing with the other stuff immediately is just not realistic for me right now. After getting up at 4:30am and working a 10-hour day (minimum), the last thing I want to do when I walk in the door at night is to read over insurance statements or the latest day-care documentation. So, it stacks up until we get so sick of it that we can't stand it.

I'm going to try to do better with this. I'm going to try to take care of these items immediately. Not only will it help with keeping the house more clutter-free, but it'll help my wife's sanity, too.

YFNN

Daily Interest & Motivation

What does a 14% interest rate on a $3,000 credit card balance really mean?
What does a 6% rate on $22,000 car loan balance really mean?

Sometimes, to fully understand the impact that debt can have on your life, you need to break it down into more meaningful chunks. For me, breaking down that interest cost to an estimated daily amount was very beneficial and eye-opening!

Let's say you have a credit card with a $3,000 balance and an interest rate of 13.99%. We can get a decent estimate the your daily interest rate by merely dividing your interest rate by 365 (days in a year).

13.99% / 365 = 0.0383% per day

Now, that 0.0383% sure doesn't sound like much, but when you multiply by your balance:

0.0383% * $3,000 = $1.15 per day!

By itself, you may say "it's only a little over a dollar a day!", but think of it this way: that's a $1.15 every day, whether you work all day, sleep all day, go on vacation, whatever. EVERY DAY. How would you feel if you woke up every morning and as soon as you walked out the front door, somebody would hold out their hand and demand $1.15? I'd get sick of that pretty fast! But, that's exactly what you're doing, just in a more deceptive way.

Want an even more extreme example?

Let's say you bought a shiny new car last year and owe $22,000 at 8.5% interest. I'll do the math again:

8.5% / 365 = 0.0178% per day

0.0178% * $22,000 = $5.12 per day!

In other words, you're forking over a Lincoln every single day just for interest on that loan! $5.12 a day would pay for my lunch every day!

Fortunately, every payment you make drops that daily interest down a bit more. Making extra payments on the principle drops it even faster.

As you can see, it wouldn't take long for your daily interest to add up to $10, $15, or even $20 a day. Couldn't you use an extra $10 a day?

YFNN

Reducing Dust on the Cheap

My lovely wife and I got a dog nearly 4 years ago. Shortly after he joined our family, we noticed the dust levels in the house increased dramatically. It's just one of those effects of having a pet I guess. We toughed it out for several months, dusting several times a week just keep things looking good.

We bought some small air purifiers, which helped quite a bit and kept the air in the house moving, but it didn't solve the problem completely.

What did help dramatically was changing our furnace filter once a month rather than the every three months that is sometimes recommended. We also set the thermostat to run the blower on the system 24-hours a day. This provided a constant air exchange throughout the entire house, and the exchanged air was being filtered non-stop. This made a huge difference in the dust levels in the house. We have to dust way less often now, we breath easier (especially during the winter), and don't wake up with sore throats and stuffed up noses.

Are there any drawbacks? Of course; there's no such thing as a free lunch. First, the cost of changing our furnace filters over the 12-month year tripled. But, the filters we use are only $10-12 a piece, so going from $40 a year to $120, wasn't exactly earth-shattering. Also, theoretically, our electric bill should have gone up slightly, and it likely did, but the extra buck or two goes completely unnoticed on a typically $100 bill.

I also chatted with our furnace repair man about the change and asked him about the added run time shortening the life of the blower. He told me that it likely wouldn't hurt it at all. Many times it's dirt and dust that kill blowers, and we're reducing those levels. And, much like a car's engine, it's easier on the motor's bearings to run constantly, rather than starting and stopping several times a day.

Obviously, there's been some trade offs, but the dust levels in our house are now pretty low, considering the size of our dog, and our indoor air quality is improved as well.

So, if you're battling indoor air quality in your home, consider changing your filter more often and running your forced air blower all the time. It certainly helped clean up our house!

YFNN

The Ramsey Plan vs. The Nerd-ey Plan

A reader commented on a previous post (thanks!) about my general financial strategy and how similar it is to Dave Ramsey’s Baby Steps. This post is a result of that comment. Also, before reading the details of my family’s strategy, please understand that I am not a financial planner. I don't have a degree in finance or even economics. I don't work in finance for a living (directly, anyway). I’m just a regular Joe that’s lucky enough to have a decent finance understanding and is willing to share my family’s long-term strategy!

I’m big fan of goal-setting, both short-term and long-term. I write them down, check on them regularly, revise them if necessary, and celebrate my successes when I reach them. I truly believe that once you set a clearly defined goal for yourself and write it down, you’re well on your way to achieving that goal. Just merely having a plan to follow makes decisions easier and keeps you focused on what’s really important to you.

So it shouldn’t surprise you that I’ve got financial goals...lots of them. I keep monthly, yearly and lifetime financial goals and they’re all meticulously documented, revisited, and revised regularly. They all help me make day-to-day decisions, and keep me moving the direction I want to go. One of the most important is my overall financial strategy.

Dave Ramsey's plan is a great starting point for the majority of Joe Q. Public. It's simple, easy to understand, and effective. But, I certainly don't think it's optimum, at least for us. The plan my wife and I follow to manage our finances and investments is more sophisticated than Dave Ramsey's plan, but I think it's a better fit for us. Yours may be totally different!

For comparison's sake, here's Dave's plan:

1) $1000 for a starter emergency fund.
2) Pay off all consumer debt using the debt snowball.
3) Accumulate 3 to 6 months worth of living expenses for an emergency fund.
4) Invest 15% of gross income into Roth IRAs and pre-tax retirement.
5) Fund college.
6) Pay off home early.
7) Build wealth with mutual funds and real estate.

My family's strategy varies in the steps themselves and in the amounts dictated by each step. Hopefully, I'm able to fully explain my reasoning for the changes I've made. Here are my steps:

1) Save $1000 per member of your family for a starter emergency fund. Personally, I don't think $1000 is quite enough, especially if you have children. It's a great goal for a single person, but if you've got a family, you've got more folks to cover and emergencies have the potential to hit a little harder. I realize for people with large families, this goal becomes significantly more difficult, so good judgment needs to be used when determining your personal amount.

2) If your company offers a match on your 401(k), take it. Invest only up to the amount required to get the entire match. If you don't do this step, you have the potential to leave a HUGE amount of free money on the table. Think of it this way: If on every payday, a man at the exit of your office's building would hand you a stack of 20-dollar bills ($100, $200, or $500) just for investing 5% of your income, wouldn't you take it? That's what your company match is: free money. Even better, it's free money that'll compound as your 401(k) balance grows over the years.

3) Pay off all consumer debt, starting with the smallest amount, using a debt snowball. In this instance I agree with Dave. Even though starting with the balance with the highest interest rate would result in a mathematically better result (minimally in most cases); I think the smallest balance should be tackled first, for a couple of reasons. First, if you go after the smallest balance first, you knock a minimum payment off your books quickly. This could be a big help if your family does get hit with some sort of financial hardship; it's one less minimum payment to make, which means your overall minimum monthly outlay is smaller. Second, there is a significant psychological boost over dropping a debt entirely, which does help to motivate you to keep moving.

4) Accumulate 4-6 months of living expenses for an emergency fund in a high-interest savings or money-market account. . I've written about the virtues of a solid emergency fund in the past, so this shouldn't be a surprise. Once you've got your debt paid off, accumulating this money shouldn't be too difficult. If you've only got one bread-winner, I think a six-month cash cushion is pretty darned important.

5) Invest 15-20% of gross income in Roth IRAs and tax-advantaged retirement accounts, up to federal maximums. I think that you can never have too much retirement income. Dave suggests 15%, but for us, 20% works up to the federal maximums. If you're fully funding two people's Roth IRAs (currently $5000 each), it doesn't take very much additional investment to reach that 20%! If you can make it automatic, so much the better. Fully funding a Roth IRA for one person is only $96 a week!

6) Fund 80-95% of college costs for your children. While you can certainly do 100% funding if you so choose, I like the 80-95% number a bit better. I firmly believe that when someone has a monetary stake in something, they take it more seriously, and in my mind, college is no exception. I fully expect my future son to contribute something to his college education (which is a long way off!).

7) Put 10% of your net paychecks into a mutual fund as a "freedom account". This is your "retire early" account, or your "travel around the world" account, or whatever-big-dream-you-may-have account. For us, it's retire early!

8) Pay off your home mortgage. Obviously, we'd all love to own our homes outright. Since a home mortgage is typically lower interest and tax-advantaged, I think this is the proper step to do it.

9) Build wealth with mutual funds, real estate, and businesses. When you get to this last step, you're living the good life. You'll have plenty of cash on hand, solid retirement accounts, a paid-for house, and fantastic cash flow. It's time to build it up even more through investing. If you choose real estate (rentals) or a business, that’s great. Mutual funds are great, too.

As I said before, this likely isn't the path that's right for you. Each individual needs something just a little different. Right now, this path is perfect for us. As things change in the future, our goals and needs may change, too. So, we're going to keep our strategy flexible.

So, what does your financial strategy look like?

YFNN

Reader Question #001 - Household Outsourcing

As I receive questions (or should I say if I continue to receive questions) via email or comments on the posts, I'll do my best to answer them to the best of my ability. I can't say that I'll answer all of them, but I'll definitely try to get to especially interesting ones. If the question is asked in the comment section, it'll probably be answered in the following comments. If I think it warrants its own post, that's what it'll get!

Anonymous writes:

"I am glad to see that YFNN is back to blogging. I especially enjoy your consumer tips, whether they are about kitchen equipment or how to put together a decent budget. Could you write something about hiring out jobs (like carpet cleaning, window washing, and installing appliances)as opposed to doing it yourself? Where's the tipping point?"

There are quite a few jobs that my wife and I outsource, so to speak. Carpet cleaning and appliance installation are some good examples. We determine whether or not those household jobs should be outsourced by evaluating the total cost of doing it ourselves vs. the total cost of outsourcing. What you've got to keep in mind is that your cost of doing something is not limited to the dollars that leave your bank account. It's also the time you spend doing the job. It's the cost of the equipment needed to do the job correctly. It's the cost of the education required to do the job right. Finally, it's your mental health or opportunity cost - I like to call this the "hassle cost". All of those costs need to be considered before a prudent decision can be made.

Here are some examples:

Changing oil in the cars, motorcycles, and lawnmower.

• Task cost - If I do the job myself, it costs about $10 in oil, a filter, and rags.

• Equipment Cost - I've already got the wrenches, drain pan, and funnel to do the job right, so my equipment cost is $0.

• Education Cost - $0 and zero time. Thanks to lots of experience, I've got the know-how to do things properly.

• Time Cost - It takes me about 20-30 minutes to change the oil in one of the cars if I move at a relatively relaxed pace.

• Hassle Cost - Low. I enjoy working in the garage and getting my hands dirty. At this point in time, the opportunity or desire to do something else is relatively low, since I have adequate time with my wife, my work, and my family already. 20 to 30 minutes in lost opportunity time isn't very critical right now.

So, my total personal cost for changing my own oil is about $10, 30 minutes, and low on the hassle cost. With the price of an out-sourced oil change up around $30 or more and close to the same amount of time, it's worth it to me to do it myself. When our child is born however, my hassle cost may increase, since I may prefer to spend that time with our family. At that point, I'll have to re-evaluate the total cost and make another decision.

Here’s another example:

Washing and ironing my dress shirts.

• Task cost - A few pennies per shirt for the cost of water, laundry detergent, starch, and electricity to run the washer, dryer, and iron.

• Equipment Cost - $0. We've already got a washer, dryer and iron.

• Education Cost - $0 and zero time. I feel that I know how to launder and press my shirts adequately. No books, videos, or training is required.

• Time Cost - I'm a slow iron-er (ironer? ironworker?). Even so, it probably takes about 10 total minutes to wash/dry/iron a shirt – 6 minutes in the washer/dryer and 4 minutes ironing (obviously, the per piece time is low when you wash a dozen shirts at once).

• Hassle Cost - This is where my cost is high. I dislike laundry and hate ironing. Hate, hate, hate ironing. I feel like it takes forever and it never looks quite as good as from the cleaners. There are also a ton of other things I'd rather do with that time, like scrubbing toilets and reading tax law.

This means that my total personal cost for washing and ironing my own shirts is about three cents, 10 minutes, and ridiculously high on the hassle cost. The cost for me to have my shirts taken care of at the cleaners is about $1-2 per shirt. From a strictly dollars-and-cents point of view, I'm a fool not to do my own shirts; it costs 30-50 times more to take them to the cleaners! But, once everything else is factored in, that $5 to $10 a week is VERY well-spent at the cleaners for me.

Obviously, each individual person's cost for a particular task is going to vary widely. The important thing to keep in mind is that your cost is not just your out-of-pocket dollar cost. The all-important hassle costs will vary greatly from person to person, as will equipment and education costs. All need to be weighed carefully before you can make a sound decision about outsourcing a job.

What are some of the tasks you outsource and why?

YFNN

The Importance of Communication

A short story, illustrating why it is important that each spouse share critical information pertaining to the financial comings and goings of the household:

A man is getting into the shower just as his wife is finishing up her shower when the doorbell rings. The wife quickly wraps herself in a towel and runs downstairs. When she opens the door, there stands Bob, the next door neighbor. Before she says a word, Bob says, “I’ll give you $800 to drop that towel.” After thinking for a moment, the woman drops her towel and stands naked in front of Bob.

After a few seconds, Bob hands her $800 dollars and leaves. The woman wraps back up in the towel and goes back upstairs. When she gets to the bathroom, her husband asks, "Who was that?” “It was Bob the next door neighbor,” she replies. “Great!” the husband says, “Did he say anything about the $800 he owes me?”

See? Communication about marital finances can save headaches AND unnecessary embarrassment.

YFNN

Reason #435 Why I Love My Wife

When I woke up way late for work today at 5:30am instead of the regular 4:30am, I was not the only one to jump out of bed in a hurry. While I was dressing and such, my lovely bride was downstairs, making me a car-friendly breakfast, gathering my work items, and finding my car keys. She even took the dog out, something I usually do as part of my morning routine.

Because of her unselfish act (she could have easily just continued sleeping), I arrived at work just a few unnoticed minutes late, rather than nearly the hour it could have been.

Thanks, honey. I couldn't have made it so quickly without you.

YFNN

Thought for 10/27/08

The following post is a YFNN rant. You may find it offensive, crude or just plain wrong. Get over it.

If there is a moral to the story of the ongoing financial bailout and the current state (and apparently future state) of politics and the country in general, it's this: it truly pays to be a loser. Irresponsibility and self-proclaimed helplessness can be very profitable.

All my life, I thought I was smart: saving my money, making prudent choices, living within my means, working hard while I got a good degree at a good school. Had I known the government would do their best to punish me for hard work and success, and reward my neighbors who sit home collecting welfare (in all of its forms) and watching Judge Judy, I'd have asked the unproductive and fraudulent to make room on their rent-to-own couch for me.

I shoulda bought a bigger house I couldn't afford with an adjustable-rate mortgage. I shoulda backpacked through Europe on credit cards to "find myself" after college rather than pay student loans. I shoulda tried to flip condos in 2004. I shoulda had kids at age 19. Man, did I ever blow those opportunities.

It clearly pays (and will continue to pay after 01/20/09, apparently) to make poor decisions and declare yourself helpless and hopelessly inept. Hard work and good decision-making is for suckers. It's time for me to stop paying our mortgage so I can get in on this free money gravy train.

YFNN

Captain Safety Glasses

I wear safety glasses a lot.

My new job has me wearing them most of the day, except for when I'm in my office. It's the metal chips and hot plastic and such. A piece of lava-hot polyethylene in the eye would be a surefire way to ruin your day. So, we wear safety glasses. I think it's a great idea.

At home, I wear them quite a bit, too. Whacking weeds, grinding lawnmower blades and sanding boards are all occasions that I think require safety glasses. So is changing the smoke detector (paint and plaster chips HURT!), changing oil in my car, and any soldering work. I even make my wife wear them when she's spraying siding wash or weedkiller (she hates me for that). From my point view, you just never know when a gust of wind or a stream splashback is going to give you a face full of Roundup. Is it so wrong to want to prevent that from blinding my one and only?

Maybe it's because I wear contacts and even the tiniest piece of trash in my eye hurts feels like a rusty steak knife. Maybe it's because I used to manage a lab and machine shop where I've seen the pain and damage that a tiny sliver of copper can do. Maybe it's because over two thousand eye injuries occur everyday and over 90% of them are preventable with safety glasses . Maybe it's because I'm just a total nerd.

Regardless, I'm definitely cool with wearing them. They're cheap, nearly unbreakable, and I don't wear glasses, so doing the whole double-glasses thing isn't a problem.

I am jealous of the guys at work that just wear their regular glasses and some clip-on side-shields, though. Those things are slick.

YFNN (aka Captain Safety Glasses)

In Defense of Sound Personal Finance

June 13th, 2008: My lovely bride and I find out that we're expecting our first child.
June 23rd, 2008: I find out that my company is closing the facility in which I work. I will be out of work in only 90 days.
September 26, 2008: I lose my job.
October 20, 2008: MLB loses her job.
Summary: In just 120 days, both breadwinners lose their jobs and they find out that a new, expensive first baby is on the way.

The last several months could have been the financial downfall of our family. In fact, with the way many people live in this country, it would be for most. But, because of the way we've decided to handle debt, income, and spending, we're in fine shape regardless of the recent shakeups.

Today, my family lost a significant portion of our earning power. My lovely wife was laid off from her place of employment. She'll receive a few weeks of severance, but then nothing (well, unemployment, maybe). Now, at first, it sounds awful, horrible, and a devastating blow to our financial objectives and plans, especially after some major life changes already. But, for us, it's not really that bad.

First, my wife is currently almost six months pregnant with our first child, due on February 14th, 2009. My wife, bless her heart, does not handle stress well. At all. Not even a little bit. Even she will readily admit that small things become big things and big things become absolutely overwhelming. Add in some pregnancy hormones, and well, you get the idea. Work was a constant source of stress for her, and under advice of our OB, she was to try to reduce her stress levels. And, since work was a large source (nearly sole source) of her stress right now, that meant reducing its impact.

We had planned on her taking leave from work (and likely not returning) around Christmas this year. We're fortunate in that her severance pays through that time period, essentially mimicking our finances as though she had been working. But, she gets the added benefit of not actually having to work until late December. Add the possibility of unemployment benefits after the severance payments run out, and we may actually be better off with her being laid off.

The only monkey wrench in the whole situation is that she carried the insurance for our family. But, even that's not a huge ordeal. My new place of employment carries the same insurance (albeit slightly more expensively), so that's not a huge hassle.

However, even if circumstances had not been what they are, I firmly believe that we'd still be fine, due to the way we've been able to handle our finances. As I've stated in the past, we maintain a rather substantial emergency fund, carry very little debt (essentially, just the house) and keep a good tab on our spending. While we certainly haven't lived a painfully frugal lifestyle, we haven't been wasteful and frivolous with our spending either.

There's definitely a lot to be said for keeping a solid financial foundation. With a well-funded emergency savings, solid debt-management, and some good career choices, you can roll with nearly any punch that life may give you.

That said, you never know what cards you may be dealt in life, so ditch that debt, cut out some frivolous expenses and save some cash!

YFNN

Today's 401(k) Conversation

I had a conversation this afternoon with a former co-worker about his 401(k), the current economy, and his future. He's a bright guy, but not exactly money-savvy, and is pretty darned impulsive. Here's how it went:

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Him: My 401(k) has plummetted recently. I've lost about $35,000 just in the last several weeks.

YFNN: I'm sure. Everybody's getting hit hard.

Him: It's ridiculous. I can't stand losing that much. I'm thinking about pulling it all out and buying a rental property.

YFNN: WHAT?!? Are you crazy?

Him: At this rate, I won't have anything left in a couple months. Why not? I can try to find a foreclosure or something.

YFNN: First of all, you buying a foreclosure is a disaster. Second, pulling out of the market now is crazy. The rule about making money in the stock market is simple: Buy low, sell high. If you sell out now, you're doing the exact OPPOSITE.

Him: I just don't like it.

YFNN: So don't look at your account for a while, like six months or so. In the meantime, keep on making contributions.

Him: That's stupid. I've already stopped adding more. Why would I put money in it just to lose it?

YFNN: Because the market is LOW. Stocks, mutual funds, ETFs, they're all basically on sale for 30% off! If you continue to contribute, you're lowering your cost basis. You're buying things low, to sell them high. You've got decades to recover from this. Do you honestly think that the market won't recover by 2040 when you retire? Please.

Him: I guess. The news just drive me nuts though.

YFNN: If we were close to retirement it'd be different, but we've both got plenty of time to see some real gains. I've even stepped my contributions up in the last couple of weeks. You've just got to hang in there, regardless of what that airhead Katie Couric says to try to scare you.

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This has got to be the overall attitude from most folks around me, and I can certainly understand why since the "sky-is-falling" media is playing the market woes up for all their worth. But, if you're 50 or younger, you've got to remember to be a long-term investor. That money you're pumping into your IRAs and 401(k)s and such is meant to be for retirement, not for next year. Continue to invest now, while prices are low, and be well-positioned for the recovery!

YFNN

Anniversary Lessons

Today (October 7th) is my wife and my second wedding anniversary. Just a short 731 days ago ('08 is a leap year), we tied the knot on a beautiful evening in front of just over 200 friends and relatives. In the time since then, I have learned an enormous amount about marriage in general and how to make things work smoothly. So, today at lunch, I scrawled down a list of things I've learned that I'd like to pass on. Some are obvious, some not so much.

- Marriage is REALLY hard work sometimes. You thought they were exaggerating at the time, but when your pastor, your parents, your friends, and everyone else told you so, you should have believed them.

- When you're single, you are as happy as you are; when you're married, you're only as happy as the least happy person in the marriage. If you're not the one that's the least happy, do everything you can to make the other one happier. It brings up the overall happiness in the marriage.

- Even if you lived with your spouse before the wedding, it's different after you're married. I can't really explain why or how, but it is. In this case, different is good.

- Church and bible studies are great for your relationship. Ditto for praying together. Seriously.

- Sometimes your spouse asks for you to be a leader, without really asking. Learn to recognize this and when you do, lead. Even if you don't know exactly what to do, lead. Sometimes it's not about leading the right way, it's just about being the leader.

- TiVo and DVR save relationships, I'm convinced. Being able to temporarily pause that show on the history of beer or the Eagles game while you take out the trash or answer "Can you help me for a second?" will dramatically reduce the potential for arguments. $15 a month has never been better spent.

- Full-disclosure financial organization, planning, and communication are of critical importance. Be open, honest and completely communicative with your spouse about EVERYTHING financial. Monthly "budget meetings" can bring a huge amount of peace-of-mind to the relationship.

- It's exceptionally rare that you can be both right AND happy at the end of an argument. You can be right OR you can be happy, but not both. It may take a while, but eventually you'll realize that it's way better to be happy than right.

- If you're like me, you'll get more accomplished around the house when your spouse isn't around. Once you both come to this realization, you shouldn't feel bad for asking her to leave you alone for a couple of hours, and she shouldn't be offended for you asking.

- When your spouse presents you with a problem, she doesn't always expect you to fix it. Sometimes, she just needs to talk about it. There's no shame in asking "do you need a listening ear or a solution?" before she starts in. But be careful, even if she wants a solution, make sure you don't give it to her until she's done completely stating the problem.

- It's perfectly fine to continue to do your laundry separately. She'll enjoy not having to turn every single one of your socks right-side-out and you'll enjoy not having to separate your laundry any more distinctly than "white" and "not white".

- Eating at the dining room table together once in a while, with the TV off, is good for you both. Ditto for sitting in the same side of a restaurant booth and sharing a dessert.

- When you first get home from work, it's important that you both get a good 15 minutes of wind-down time. Being bombarded or bombarding her with "You should..." or "We need to..." or "Can you...?" statements right when you get home just gets people frustrated. Give each other fifteen minutes to settle in first. Amazingly, everything will still get done and you'll both be happier.

- If you leave the house and there's a chance you won't be home before your spouse gets in, leave a note. Yes, it seems trivial to you, but it's not to them. It only takes a second. Just do it.

- Sometimes when your spouse says "Can you help me with this?" she really means "Will you just do this for me?". That one took me a long time and a lot of frustration to figure out. I now know that when my wife asks for my help in rolling up the garden hose or take something to the attic, she really just wants for me to just do it. And that's okay. Sometimes it's faster and easier to just do it yourself than with her, ahem, help.

- Right before bedtime can be really stressful for her. I'm not exactly sure why, but apparently it is. Being helpful gets you in bed and asleep faster than just getting in bed and trying to fall asleep while your spouse stomps around.

- The hormones from pregnancy make your wife go completely bat-s**t crazy (at least the first 22 weeks...that's all the farther we currently are.) You will never cease to be astounded by the completely irrational and non-sensical things that come out of her mouth and that she does. Even she will readily admit that some pregnancy-related books that explained these things (that'll be a future post) have been the only thing that has stopped me from committing her to an asylum.

So there's the lessons I've learned. In just a couple short years, I've learned a lot. Just imagine how much I've got to go!!!

YFNN