Your Friendly Neighborhood Nerd

Insult to Injury

2009-04-09T14:50:00.005-05:00

I got my hair cut today. I tend to keep it pretty short and disheveled (maintenance-free, baby!), so I just go to the cheap-o Great Clips place around the corner where I can get it cut for $8 with a coupon. Usually, my once-a-month visit is quiet, quick, and pleasant. Today, though? Lacking the pleasant part.

Now, I've been going grey for quite some time. Around 17 or 18, I started to notice my first grey hair, and it's been getting steadily worse since then. Now, I'm downright salt-and-pepper. I'm generally okay with that, and it's probably helped my career a bit. I've found that if I keep my hair short and maybe put a little gel in it, it's not nearly as noticeable to most folks. It doesn't hurt that I'm also 6'4", so there aren't a whole lot of people getting a good view of the top of my head on a regular basis.

Today though, it was an issue. The stylist (someone I'd never seen before) and I were chatting as she trimmed my flowing locks (ha!); just the general chit-chat that always occurs. Somehow, we got to a point in the conversation where I mentioned that I had just had a milestone birthday this past Sunday. Here's how that conversation went:

Me: "Yeah, I just had a milestone birthday this past Sunday."

Her: "Oooo, let me guess how old you turned...um, forty?"

Me (noticeably peeved, I'm sure): "Yeah, um. Actually, no, I just turned thirty."

Her: "Oh my gosh. I'm really sorry. I didn't mean to..."

Me: "That's okay, I'm starting to get used to...."

Her: "It's just that I saw all that grey hair on the apron and thought....I mean, you're REALLY grey for thirty."

Wow. Gee, thanks, lady. You sure know how to brighten my day.

At least I only paid $8 for the abuse.

YFNN

Things Are A-Changin' Around the YFNN House...

2009-04-06T16:52:00.008-05:00

Our house had some pretty gnarly pine trees at each corner of the house. Likely planted when the house was built (in 1986), they’d grown to over 20 feet tall and were ridiculously close to the house itself. They weren’t even all that attractive. Check out the pictures.

This caused some problems. First, every time the wind blew, the trees would sway a bit and rub against the house siding, or the windows. This always made some noise, usually annoyed us, and occasionally spooked our bossy dog. In addition, they were close enough to the house that their root systems were getting to be a concern for our basement and such. Then, last year, we got bagworms, and despite their manual removal and treatments, they slowly started to kill the trees. So, we decided that the trees had to come out.

Since the tree folks were going to removing at least four pine trees, we also had them remove an additional white pine that was diseased and encroaching on our deck, a large half-dead cherry tree in the center of our back yard (yeah, it was as dumb as it sounds), and a terribly unruly shrub that no matter how much we cut it back decided to take over an entire side of the house, preventing access to the lone outdoor hose spigot.

So, last Tuesday, the tree guys removed it all while I was at work. Apparently it only took a couple of hours and they left no damage and no debris. They did, however, leave the stumps, but those should be ground out shortly.

The next phase of the project includes reseeding certain areas with grass seed, planting new plants (of the placement and type I am unaware, but trust my wife’s judgment entirely), and finishing with mulch and such. That work should commence next week.

Right now though, I’m just looking at some stumps and bare dirt around the house, but I can already see that it’s going to look MUCH improved. The fact that it’s going to be less work, less worry, and give us more usable yard is even better.

YFNN

ING Savings Rate and Other Ramblings

2009-04-06T12:03:00.003-05:00

ING, Debt, and Savings

Well, ING Direct dropped their rate for their Orange Savings Account yet again. This time to 1.490% APY (1.50% APR). So, my money is now working a lot less hard for me than it was before.

Still, it’s way better than my brick and mortar bank’s rate (currently 0.05%), and our emergency fund money is safe there, so I’ll keep slowly piling up money there every week.

Also, with savings account rates so low right now, it’s a great time to pay off debt. Do it, do it, do it. Make sure you keep a bit of a cash cushion in savings, but don’t be afraid to pound out some debt right now.

We don’t currently carry any debt (aside from the house), but my student loans used to be at a fixed rate of 3.375% APR. When ING Direct was giving me 4.5% APY on my savings, it made sense to put money into savings, rather than pay off debt. Essentially, we made more money on interest on the savings than we paid in interest on the loan. Now, even with the student loan interest tax deduction, it makes more sense to pay off the loan.

If you’re on the fence about paying off some debt, DO IT. I can’t tell you how calming it feels not to have worry about car payments, credit cards, or other debt.

Insurance Coverage

In other news, we’ve finally completed the finalization of our bills from the hospital for our most recent trip. The hospital charged the insurance company over $16K for my wife and over $4K for the baby, but thankfully we were responsible for much, much less. It was interesting to see just how inflated the charges from the hospital were and how much they'd actually accept from the insurance company. Examples? You betcha.

My wife's stay: $16,757.40. Insurance paid just $4,261.84. I paid $1,065.46. So, basically the hospital wanted almost $17K, but only got a little over $5K. Ridiculous.

The epidural: $3,280. Insurance paid just $880. I paid $220.

Baby's stay: $4,261.84. Insurance paid just $1,032.24. I paid $258.06.

It's crazy to me that the hospitals are willing to write off so much money (and charge so much to begin with). I know the reasoning behind it all, but I don't want to get into it right now. Suffice it to say, the way we handle insurance is stupid (and no, universal healthcare would make it worse, not better). Maybe that'll be another post some day.

Friends and Food

Since the birth of our son, we’ve had loads of people over to visit and especially to bring us food. Before Baby was born, I kind of poo-pooed the idea of everyone bringing food to us, thinking that I’m still more than capable of putting together a meal for us every night. But, I’ll definitely admit that it’s pretty nice having something in the refrigerator or freezer that just needs to be heated. I wouldn’t have believed it before, but it’s a little difficult sometimes to find 30-45 uninterrupted minutes to put together a nutritious meal. We’ve been very fortunate to have such wonderful friends and family, especially ones that can cook!

YFNN

I Wanna Be a Mean Parent

2009-02-20T06:43:00.002-05:00

When I was a child, my parents were mean. Horribly mean. And, I hope that I will be just as mean as they were.

My parents weren't physically, emotionally, verbally, or psychologically abusive. That's not the kind of "mean" that I'm talking about.

When other kids had Oreos and ice cream for breakfast, we had to have eggs, toast, or cereal. When other kids had Pepsi and chips for lunch, we had sandwiches and carrots. While other kids had pizza and cake for dinner every night, my mean parents gave us healthy meats, potatoes, vegetables, and fruits. My parents were mean when it came to food.

We were required to be clean and wear clean clothes; other kids could wear the same clothes for days. We had to have normal, appropriate haircuts; other kids were allowed to be rebellious with their hair. We had to look “presentable.” Since I'm the oldest of their three children, I didn't have to wear hand-me-down clothes, but my mean parents made my brother and sister wear my old-but-still-good clothes, just to save money for other things like college. Can you imagine?

Our mean parents gave us bedtimes. And we had to stick to them! While other kids got to sleep until noon on the weekends and have no responsibilities, my parents completely disregarded child labor laws and gave us chores to do before we could play. We had to help with the dishes, set the table for meals, and keep our toys picked up. It was like they dreamed up chores for us to do in their sleep! Where did they come with these unreasonable expectations?!

Once we were in school, things got even worse. We had to walk to the bus stop, about a block away, for junior high and high school. Even in the rain and when it was cold. Other kids got to sit in their parents’ fancy car, even on nice days, avoiding the unrestricted socialization with the kids besides us with mean parents.

My brother, sister and I weren't allowed to be "sick" like our friends and miss school. Some other kids could stay home by themselves when they had a headache, hangnail or other critical ailment. Not us. In fact, I can distinctly remember my mother saying "You're not sick, you just have a cold. Get up and go to school." We never got pulled from school to go on vacations. "That's what summers are for," we were told.

They were mean about our grades, too. While other kids celebrated Cs and Ds and just passing classes, my parents accepted nothing less than As and Bs. Somehow they knew that if we got anything less, we weren't really trying. They had us figured out. They were actually involved in our education. They kept tabs on major projects, annoyed us about completing our homework, and constantly asked if we needed help. We were expected to speak properly, and write even better. It was horrible. Come graduation time, none of us were allowed to drop out and we were expected to go to college. Just awful.

Our mean parents made us go to church every week. We couldn't skip and stay home like some other kids. We weren't allowed to wear jeans or shorts and we had to look presentable. We had to pray, participate, and pay attention in our Sunday School classes and during the service. Unlike some of the other kids, we weren't allowed to climb on the pews, make noise, or fall asleep. It was completely unfair.

When we were older, my mean parents insisted on knowing where we were at all times. They had to know where we were going, when we were getting back, and who we were going with. If plans changed, we were required to call. If we were late, we had some explaining to do.

They set rules and boundaries for the three of us. They knew how to say "no" and weren't afraid to do so. Their "no"s were uncompromising and there was no negotiating the standards of behavior that were expected. Even if they didn't totally agree with everything, they worked as an unwavering team to set the bar high and expect the best from us, always.

Somehow, their mean-ness worked. All three of us grew up to be well-adjusted, polite and well-spoken. None of us have been arrested or talk like Valley Girls. We all hold college degrees (one of us, multiple!) and are now successful on our own. They taught us to be tough, smart, and strong. None of us are entitlement-minded or dependent on anyone or anything. We grew up to be honest, God-fearing, and self-motivated. And, we owe it all to our horrendously mean parents.

Now, with a child of my own, I hope to set the same mean standards and expectations. I can only hope to be as mean a parent as they were. I can’t wait to use one of my favorite phrases, “You’re not sick, you just have a cold,” and I can guarantee you that I will be filled with pride when my child finally calls me "mean."

So, if you're reading Mom and Dad, thanks for being so darn mean.

YFNN

Cool Things I Learned About Childbirth

2009-02-19T21:27:00.003-05:00

If you've got a thing about blood, poop, or medical stuff, you may want to skip this post. Seriously.

As I stated in the previous post, I was heavily involved in the birth of our son about two weeks ago. I asked lots of questions, got as close as they'd allow, and kept involved as much as possible. I learned a tremendous amount, and had a great time on my little science-y field trip to the labor and delivery room with my wife. Here's just some highlights:

Contractions are surprisingly consistent and predictable, both in frequency and magnitude. I loved the live data that the monitors were able to acquire regarding heart rate, blood pressure, and the contractions.
Internal heart rate monitors (for the baby in utero) are actually screwed into his scalp when it's visible through the vagina. Like a tiny fishhook.
The baby's first poop is actually meconium and is from swallowing amniotic fluid and such.
Babies can have their first poop in utero. This can cause some problems immediately after birth, so the uterus is flushed out with clean fluid during delivery.
Once the baby's head is out, things move pretty quickly. No, I take that back. Darn near instantly.
Babies are sometimes born with splotches of vernix on them, which is a waxy, protective gunk. It kind of looks like soft, white cheese.
Umbilical cords are much thicker than I thought and when you cut it, it feels like you're cutting rubber tubing.
After the rest of the umbilical cord and placenta are delivered, you have to inspect the placenta to ensure that all of it made the trip out. Small pieces left inside are dangerous.
The placenta and umbilical cord pulsate a bit after they're out. Yes, it's as creepy as it sounds.
If the doctor decides that an episiotomy is needed, they're quick and precise with the scissors. If you blink, you miss it.
There are different levels of tearing, one to four. Level two isn't bad.
They put antibacterial gel on the baby's eyes shortly after birth to prevent infection.
Babies sometimes come out with fine hair on their back and shoulders called lanugo. It falls out after a little while.
There's a slick little tool that's used to perform the circumcision of newborns. It makes it darn near impossible to mess up. It even comes in different sizes. :)

All in all, it was a very educational trip.

YFNN

My Really Good Reason

2009-02-19T18:16:00.006-05:00

It’s been a while since I posted, and I have a really good reason, I promise.

On Monday, February 9th, my lovely wife gave birth to our perfect baby boy. As a first-time father, I can tell you that it was absolutely unbelievable on so many levels.

First, I thought I was prepared mentally and thought that I understood what it would feel like to be a father. I wasn’t. Not even close.

As soon as he was born, I cried. When I held him for the first time, I cried. When I changed his first diaper and held his little hand, I cried. Even now, over a week later, I look into his tiny eyes as I hold him and just cry tears of joy. I was completely unprepared and I don’t think I could have ever fully understood before it happened.

Second, I learned that my wife is probably the strongest woman I have ever met. I had no idea that she had it in her. She was absolutely incredible. To see the anguish and effort that she went through was absolutely amazing. She was a trooper. She was WonderWoman. I will never forget her toughness she showed through 18 hours of labor and over two hours of pushing. She was completely inspiring and now carries an ever greater air of self-confidence and strength. I love what this baby has done to her.

With the touch-feely, decidedly un-manly stuff out of the way, I have to say that from a nerdy point of view, the birth and subsequent few days was awesome. I’m not one to shy away from questions or interactions, so it was like a big science-y, medical vacation for me. I learned about epidurals, meconium, and contractions. I learned how the contraction monitors work, how internal heart rate monitors work, and the whys and hows of the birth of a child. I got to see the first glimpse of my son’s head, and hear his first cries. I got to cut his umbilical cord and help with APGAR scoring. Not being one to turn down a science-y opportunity to learn hands-on, I learned about the afterbirth and the delivery of the placenta (much to my wife’s chagrin).

On the day after my son was born, I asked many questions to the pediatrician, and even got to help with circumcision. While it sounds a little disturbing, it was awesome.

I was lucky that the doctors and nurses we had were so friendly and open to questions. I’m sure they don’t get too many people like me, so I’m glad they were so willing to share their knowledge and allow me to get a little closer than most probably dare.

After being involved every step of the way, I can assuredly say that the birth of a child truly is nothing short of a miracle.

YFNN

(Isn't he cute?)

Cops and Sandwiches

2009-01-29T11:15:00.003-05:00

Every Wednesday, the guys in my engineering group and I go out for lunch together. We try hard to not discuss work-related things and a tasty lunch is usually punctuated with plenty of laughter and good-hearted insults. It’s a great camaraderie-building event.

Yesterday, we made a trip to one of our more common stops: the Ohio Deli, a local diner-like place that has GREAT sandwiches and soups. The Deli was recently featured on a Travel Channel show called Man vs. Food. The hero of the show travels the country, visiting different establishments that tout extreme eating challenges. The Ohio Deli’s challenge: The Dagwood.

The Dagwood is certainly a sandwich to behold. Named after the comic strip hero Dagwood Bumstead’s colossal sandwiches, the Dagwood is packed with 2-1/2 pounds of three different kinds of deli meat, tomato, lettuce onion, and mayo, all stuffed between a couple of mammoth hunks of sourdough. The platter comes with a heaping pile of the Deli’s delicious fries and a pickle spear. The challenge is to consume the entire platter in less than 30 minutes. According to their photo wall of fame, the current men’s record is 5-1/2 minutes. (!)

When we entered the Ohio Deli yesterday, we were seated next to some city police officers, who were getting ready to order. After some ribbing from his buddies, one of the officers decided to take the Deli’s Dagwood challenge.

When he got his platter, I think he was little shocked. The sandwich was towering over a huge expanse of fries. The waitress casually placed the platter in front of him (using two hands) and noted that he had until 12:10 to finish (30 minutes). To his credit, the cop really gave his all. He was able to finish the sandwich in about 15 minutes, after loosening his gunbelt. He really struggled through the fries and especially the pickle spear, but he finished with just a few ticks of the clock to spare.

H was, of course, heartily congratulated by our table, and the waitress took his picture and gave him his tee-shirt to commemorate his momentous achievement. As his group was getting up from the table, he commented to us that he sure hopes he doesn’t have to chase anybody or do anything strenuous the rest of the day and we certainly agreed.

However, as they were leaving, we looked out the window to our snow-covered streets, and saw a tiny woman in a BMW stuck at the stoplight. She had already exited her car and was desperately trying to shovel the piles of snow out from underneath the front end. Of course, the officers saw her and felt obligated to push her on her way.

While we couldn’t hear exactly what was being said, it was pretty clear that it was hig buddies thought it be absolutely hilarious that the Dagwood champion was quickly voted the guy to push the lady’s car. And push he did. He got her moving, but was he ever green in the face when he was done.

Of course, after such a display of manliness and heroism, two the guys at my table decided that next week they’re going to attempt the Dagwood challenge. I told them that I’ll happily just watch the clock for them and finished my Buffalo Chicken Spinner. I’ll let you know how next week goes.

I'll bet it goes delicious.

YFNN

Fun With Numbers

2009-01-28T07:15:00.002-05:00

It gets to a point with numbers that you start to lose your sense of perspective and relation, especially with money. I can relate to and understand $100,000. I can even relate to one million or one hundred million. But after a point, we start to lose our reference point and it turns into monopoly money and politicians know that. Does $400B dollars really feel twice as big as $200B? Not to me. It's lost perspective. So, it's important to express these numbers in something we can relate to.

Obama's $825B "emergency" stimulus plan (I put "emergency" in quotations because only 3% spent in the first year isn't much of an emergency) is like spending:

$1,000,000 a day for the next 2,260 years.

Yes, that's right. The next 2,260 years. One million dollars. Every day. From now until the year 4269. 4269.

Not enough? Try buying this 14 bedroom, 18 bathroom, 33,000 sq. ft. home in Park City, Utah every hour, on the hour, for the entire length of Obama's first term.

That's spending $23,500,000 over 35,000 times. That's a lot of 23-million dollar mansions. Enough to give every single Senator and Congressional Representative a mansion in each state and still have over eight thousand mansions left over.

Crazy big numbers. Keep them in perspective.

YFNN

Week One Under the Messiah

2009-01-27T22:44:00.002-05:00

Summary of week one under the rule of "the chosen one".

1) Has his preacher friend declare that whites are racists for him.
2) States his intent to implement national gun control.
3) Pisses off press corps by not answering questions and talking down to them.
4) Acts like a jackass to the Senate minority whip.
5) Appoints Nancy Pelosi as dictator of national fuel economy standards.
6) Announces closure of terrorist retention facility.
7) States intent to pull out of Iraq ahead of schedule.

I just can't get enough change.

YFNN

This Ain't Calculus

2009-01-26T08:32:00.005-05:00

My wife is due in less than three weeks. Less than 21 days.

Yikes.

To say that I’m personally unprepared is an understatement. Now, don’t’ get me wrong here. I’m an engineer by trade, so preparation and organization is what I do. Our checklists are completed, items have been purchased and assembled, and the closet is stocked with diapers. I’m confident that our home, nursery, and all the required “stuff” is ready to rock (likely overly-ready-to-rock). Stuff-wise, I feel like we could bring home half a dozen babies and not need to buy a thing, but mentally, that’s a different story.

I’m usually calm, collected, and practical. I plan, I rehearse, and when the time comes for most things, I’m sure I can deliver. I’m the kind of guy that rehearses presentations and buys adequate life insurance. I’m confident. I perform well under pressure. That’s why this baby is beating me up. Sure, I’d like to think that I’m mentally prepared for this kid, and I think I do a pretty good job of convincing my wife that we should feel comfortable and ready (and we should!), but deep down I know that I’m personally not even close. What’s worse is that I know even with infinite planning, I'll never be totally prepared and that scares me. I’m not used to that at all.

It’s just that the consequences seem so extreme to me. If I botch a presentation or mess up at work, it’s fixable. If I bang up the car or burn down the house, they’re replaceable. But with this kid, I get one shot to get it right. No do-overs. No mulligans. If I mess him up, it’s permanent. Not only for my wife and I, but for the rest of his life too. That’s absolutely terrifying.

I’ve got the mechanics down. I know how to change a diaper; I know how to operate the carseat. I know how to carry him and I know what to look for when he’s ill. But, how do I know what to say and when to say it? How do I know what to teach and how to teach it? What if I teach him the wrong thing? What if I’m already out-of-touch with today’s kids? How do I even know if I mess up?

This is way out of my comfort zone. I like well-defined answers. Every calculus problem has one correct answer. One. Every design has one optimum. One. Every manufacturing process has one maximum efficiency. One. With this baby, there isn’t one answer, and that unbelievably frustrating.

I need a single solution. An optimum. A perfect plan of what to do and when to do it. It’s pretty obvious I’m not going to get it.

Maybe this is why I hated all those liberal arts classes in college; I need a right answer.

As always, any and all advice would be appreciated.

YFNN

Direction or Misdirection?

2009-01-22T08:35:00.004-05:00

Recently, economist and policy analyst Stephen Moore did an interview with a well-circulated newsletter that I occasionally read. He's is the author of the new book "The End of Prosperity" (linky-linky) and an editorial writer for the Wall Street Journal. He is very well educated and was the senior economist for the the U.S. Congress Joint Economic Committee, so he definitely knows what he's talking about. I found this segment of the interview particularly interesting and certainly timely as we start a new era with a president and congress bound and determined to try to regulate, socialize, and tax this country into prosperity:

“The 1990’s was a great decade. Our book (The End of Prosperity) describes when Reagan came in with a new kind of supply-side pro-free-market philosophy- turning around, by the way, the worst decade of the century other than the Great Depression, which was the 1970’s.

Amazingly , the left is rewriting the history of the 70’s: “If only we hadn’t had Reaganomics, we could go back to those wonderful years of the 1970’s”- when we had gas lines and 25% mortgage interest rates and 14% inflation.”

In any case, Reagan did two things. He cut tax rates very significantly from 70% all the way down to 28%. And he slayed inflation. The inflation rate went from 14.5% down to 3%. We had the greatest boom for 25 years in the history of civilization. No country had ever seen anything like what happened in American from the early 1980’s through 2007. We created $40 trillion dollars of net new wealth over that period. It was an awesome experiment in prosperity.

Now, Bill Clinton’s tax increase did hurt the economy, The evidence is that in the first two years in the Clinton Administration, the economy actually slowed down. But once you had the Republican Revolution in 1994, once you had the combination of Newt Gingrich and Dick Armey running the Congress, then Clinton moved back to the right. That’s when he gave his speech, “the era of big government is over.”

We had welfare reform, we had the capital gains tax cut, we balanced the budget. Those were all pro-growth Reagan ideas.

But a lot of the economists that I talk to in the Obama camp look at that period and say, “Look, we can raise taxes through the roof and its not going to hurt the economy.”

That’s a very dangerous idea at a time when the rest of the world is going the other way. China, Sweden, India, my goodness, Russia has a 13% flat tax. How are we going to compete with them with a 40% income tax? It’s a really dangerous idea to be talking about raising taxes right now in the face of the worst economy we’ve had in 25 years.”

Ah, the 70's. I'm so glad I was just a baby during the vast majority of them, especially the Carter years. I think my head would have exploded. I just hope the new prez doesn't take us the same direction.

YFNN

Advice for 01/15/09

2009-01-15T06:36:00.003-05:00

Advice of the Day: Don't sneeze when you've got a mouth full of shredded wheat.

Follow-up advice: If you do sneeze with a mouth full of shredded wheat, don't try to contain it with your hand. It just ends up all over your face, including your eyes, beard and nose.

Follow-up to the follow-up advice: If you do sneeze with a mouth full of shredded wheat, and you do try to contain it with your hand, make sure you check yourself out in a mirror before heading to a meeting. Partially-chewed shredded wheat in your goatee is not professional.

YFNN

The Great Closet Adventure, Part Two

2009-01-12T20:15:00.001-05:00

I wanted to make sure that the closet I designed was efficient, functional and most importantly, flexible. I wanted the ability to move shelves and rods around as our closet needs changed and evolved. To me, this meant that everything needs to be installed on standards. (standards are the vertical beams that brackets attach to). That would allow anything to moved up and down in approximately 1.5" increments.

Flexible. So, I started installing the standards I had purchased on every stud in the room. All told, I installed 22 seven-foot standards. When I was done, looked a bit like a prison, with white bars even spaced every 16 inches.

Next, I referenced my parts list and double checked some measurements. Then I started cutting my shelves to length. The shelves I purchased were heavy-duty ClosetMaid shelves that were 12 inches deep and had an integrated hanging rod for clothes on hangers. Even though they were available in 4, 6, and 8-foot lengths too, I purchased the 12-foot lengths to reduce cost. I had a cut sheet drawn before I shopped, so I knew exactly how many lengths to get and how much waste I would have. I pulled out my DeWalt sawzall (my favorite power tool) and got to cutting the shelves to the correct length.

As I cut them one-by-one, I wiped them down and installed the plastic end caps to cover the rough ends. Then I moved the upstairs and installed them on the brackets in the standards. Before long, everything was cut and installed. I made some minor adjustments to the shelf heights and lengths, and at the end I was left with a total of only 18" of scrap shelf, in three pieces. Not too bad.

We spent the rest of the day putting the clothes back in and sorting and re-organizing my wife's clothes. When we were finished, we had gained about 7 linear feet of hanging space and another 12 linear feet of shelf space. We were able to get all of her clothes and all of my clothes in, and still space left over. Efficiency is beautiful.

My wife was amazed. Not only was there more room, but everything was still easily reachable and organized. I was referred to as the "closet magician" the rest of the weekend.

All in all, it was a lot of work, but the wife is happy, the baby has a closet, and I don't have to trek to the basement to retrieve my khakis in the morning. Complete success.

YFNN

The Great Closet Adventure, Part One

2009-01-12T16:58:00.001-05:00

I lost my closet.

My closet has been taken over by an unborn child. You see, when my wife and I married, I got the closet in the spare bedroom upstairs for my clothes. The large walk-in closet in the master bedroom was inefficient and, um, full. My little closet was tight, but adequate. I even built some shelves to better utilize the top space above the hanging rods. Even though I had to go to a different bedroom to retrieve my clothes in the mornings, all was well and we were happy with our closet space.

However, when we found out that my lovely wife was pregnant, the spare bedroom upstairs was quickly deemed "the nursery'. At first, I thought "No problem. Baby clothes are tiny and don't need hung up anyway. My closet is safe." Boy, was I wrong. Through the nesting process (learn about that bit of fun here), I was firmly informed that baby clothes are indeed hang-able and will take up a lot of space. They even sell baby clothes hangers, which are basically miniature versions of adult hangers at higher prices, but apparently they're very important. Ask me how I know.

Anyway, I was also informed that under no circumstances was I to enter the nursery every morning at 4:30am to retrieve my clothes. So, I was ousted from my closet and had to come up another solution. The basement bedroom was out (too far), the office closet upstairs was out (full of office-y stuff), and the coat closets downstairs already house, well, coats.

So, that left me with reorganizing and increasing the space efficiency of the master bedroom walk-in closet. So this weekend, we set off on that task.

The master bedroom closet is a pretty big space, although oddly-shaped. The existing shelves and rods were installed by the previous owner and were in rough shape. They were the cheapest plastic-coasted wire shelves you could buy, supported by plastic wall hooks and flimsy sheet metal brackets. Nothing was screwed into studs, but used plastic wall anchors in drywall. Many shelves had started to droop and the anchors were starting to pull out of the drywall. To top it off, it was ridiculously inefficient. All the shelves were hung at approximately eye-level, leaving a three-foot space of unused space above them, and another 2 foot space underneath the clothes that hung off them.

Since the closet was already full of my wife's clothes, belts, and shoes, there was absolutely zero space for my items. Add that to the near-dangerous hardware, and it was clear that I needed to rip everything out and start over.

On Friday (I only work four days a week...more about that later, I suppose), we moved all of her clothing to a couple of portable closets and out of the way. Then we spent the remainder of the day removing the existing shelving.

Apparently, the previous owners were not engineers. Nor were they efficiency experts or likely even high school graduates. What they were, however, is lazy. Complete home improvement hacks. They were the type of folks that wire light sockets backwards so you get zapped with you change a lightbulb. Or the kind that add lights to the garage by looping wires over existing wires and just taping them up. Dangerous home improvement hacks.

As I stated, not a single screw in the closet was screwed into a stud. Screws were either screwed directly into the drywall (which means they did essentially nothing) or used plastic wall anchors of varying sizes. What's more, no less than eleven different screw sizes and types were used. Eleven! Apparently whatever they had laying around sufficed. They ranged from 2" deck screws to 4" wood screws and even some machine screws. Some had flat heads, some had round heads. Some required a Phillips screwdriver, some required a flathead. Some of the brackets were even secured with nails pounded into wall anchors.

Yep. Nails.

When we were finished removing the old stuff, I was left with an empty room with 64 holes the drywall ranging from 1/8" (screws directly into drywall) to 1/2" (BIG plastic wall anchors). Did you see that? Sixty-four holes. None of which lined up with a stud. Zero. I can't believe the whole system didn't collapse under the weight of Wifey's stuff.

So, I used an entire small container of putty and patches and got to work. Four hours later, everything was spackled, dry, sanded, and smooth. Since the putty matched the paint, it didn't even look too bad. I took some measurements of the room and grabbed my green engineering grid paper (yep, I'm a dork).

I made scale drawings of the room from all angles and optimized the space available with the parts I knew were available at our local hardware store. Before long, I had six scale drawings of the closet from varying angles with every shelf, rod, bracket and standard in place, along with a complete parts list.

90 minutes, $700, and one scary car trip later, I had every piece of hardware needed laid out in the garage. I set up my WorkMate (which are awesome) as a portable vise and went to bed. The rest would be tackled in the morning.

More later...

YFNN

My Best Advice for 2009

2008-12-31T21:42:00.001-05:00

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

2008-12-31T19:18:00.004-05:00

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

2008-12-18T06:31:00.002-05:00

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?

2008-11-28T09:00:00.002-05:00

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!

2008-11-27T18:45:00.000-05:00

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

2008-11-27T12:32:00.004-05:00

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!

2008-11-27T11:36:00.004-05:00

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

2008-11-12T07:15:00.000-05:00

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

2008-11-09T11:46:00.003-05:00

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

2008-11-05T17:16:00.002-05:00

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

2008-11-01T13:56:00.009-05:00

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

2008-10-29T16:50:00.002-05:00

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

2008-10-28T19:37:00.006-05:00

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

2008-10-27T07:37:00.001-05:00

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

2008-10-27T07:33:00.004-05:00

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

2008-10-23T18:14:00.002-05:00

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

2008-10-20T15:17:00.004-05:00

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

2008-10-19T14:05:00.005-05:00

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:

~~~~~~~~~~~~~~~~~~

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.

~~~~~~~~~~~~~~~~~~

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

2008-10-07T16:16:00.006-05:00

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

Gourmet Kitchen on a Budget: Part Three

2007-08-13T15:40:00.000-05:00

So far, I've delved into the worlds of knives and cookware, defining what I think is the best way to equip a kitchen on a budget. Today, I'm going to take a brief look at kitchen power tools.

As a foodie, an engineer, and just a plain 'ole guy, it's hard not to be sucked into the large and confusing world of kitchen power tools. They combine three of the things that I love most: physics, food, and power tools. If finance could be somehow shoehorned into that mix, there's no way I could resist the siren-song of the kitchen power tool department at my local kitchen store.

My kitchen is by no means expansive, and storage space, especially for gadgets, is at a premium. So, it certainly pays to have equipment that can perform double-duty. Now I'll be the first to admit that I have more kitchen power tools (KPTs from here on out) than I could possibly need and a good percentage of them are single-function tools. Some of them are mistakes, some are worth every penny. Many of them were gifts, but some were definitely well-pondered purchases. Here's the skinny on them all, good and bad.

*DISCLAIMER* - If you're reading this, and you're one of the people that gave me one of the items as a gift, please don't be offended if I'm critical of the device. I'm not being critical of you or your choices, just the merits of the device itself.

Cuisinart Ice Cream Maker - While this item is without question a single-function tool, it's a darn good one. There's really no way to make good ice cream, sorbet or slush without one. Like most home ice cream makers, it's got a removable bowl that goes into the freezer before making the ice cream. Typically, I just store the bowl in the chest freezer in our basement. The times I've used it, it's been flawless. I guess if I had to complain about something, it'd be that it's a bit noisy and it doesn't make more than just a couple cups of ice cream. If I were going to purchase one (mine was a wedding gift), I think I'd probably focus one a key characteristic: power. My ice cream maker has a 50-watt motor. It seems to have plenty of guts to spin through some pretty thick ice cream even with chunks of chocolate and what-not. I don't have a good solid number that you should shoot for, but I can tell you that 50 watts seems adequate to me. If you have no intention of making frozen desserts, this is a complete waste of cash, but if you enjoy the flavor of mint julep sorbet (as I do), this KPT is a not a bad choice.

KitchenAid Stick Blender - Oh baby. I affectionately refer to this magnificent gizmo as my "boat motor". My particular model has selectable speeds and it's perfect for smoothing out sauces, thickening lighter sauces and blending stuff in a pot. I like to make my own barbecue sauce, and I use this wonder-tool to puree all the chunks of onion and garlic and make the sauce as silky as can be. I also use it quite a bit for smoothing out pasta sauce, since I don't particularly care for huge chunks of tomato and vegetables in my sauce. This blender cleans up easy, too. The blade portion is removable, so a quick rinse in some hot soapy water and it's good as new. Since you can pick up a decent one for a low price, and it doesn't take up much storage space, this is also a definite buy. Although mine has got nine speeds, I don't think that's necessary at all. Just two would be certainly adequate.

T-Fal Deep Fryer - I'm on the fence with this one. Since I'm responsible for safety in my job, I tend to bring that mindset home. If you're going to deep-fry food, this is probably one of the safest ways to do it. Frying can be a dangerous job, and this machine helps reduce the danger. It's got a basket the lowers itself into the oil, a safety-minded cord, and a lid that covers the oil while cooked, all of which greatly improve the safety of frying. It also has a built-in adjustable thermostat so that the oil doesn't get too hot, and since there's no open flame (like from a burner), there's little risk of a grease fire.

It is rather convenient, too. All the oil is self-contained and the adjustable thermostat makes temperature control pretty brainless. But, at $90 or so, it's expensive and it takes up a lot of storage space. And, the same foods could be produced using a dutch oven and a thermometer on the stove, albeit with a lot more headache and danger. I guess what it comes down to is this: if you deep-fry stuff more than a couple times a month, it's probably worth it. If you don't, it's not.

Rival Crockpot - This slow-cooker is worth every penny if you like good food and you're lazy. You can cook a pork roast in it all day long (with potatoes, carrots, etc.) and have a meal ready for when you walk in the door from work. You can cook chili in it. You can keep potluck-style items warm for long periods of time. Although I got mine as a gift many years ago, they're inexpensive and easy to find. If you're looking to purchase one, try to find one with at least two heat settings. More settings mean better temperature control and less over-cooked food and less worry. Even one with just a high-low-off switch is much better than just an on-off toggle. They're selling some pretty sweet crockpots now with timers, so that you can have it turn on or off automatically. Also, find one with a nice, heavy ceramic liner. This makes clean up easier since you can just remove the liner from the heating elements, and the heavy ceramic evens out the heat across the entire pot. Even though this takes up a good amount of space, it's a KPT that's worth having around. It's just a shame that I got mine before Rival started making them without the silly country flowers motif. It never fits with my decor.

So, that's a start. I'll delve into some more KPTs tomorrow.

YFNN

Gourmet Kitchen on a Budget: Part Two

2007-08-07T19:45:00.002-05:00

In my previous installment, I talked at length on the importance of good knives for the well-equipped kitchen. Today, I'll discuss what I believe to be the second most important must-have: good cookware.

In college and in my pre-marriage days, I cooked with some middle-of-the-road T-Fal cookware. It came in a big (13-piece?) set at Target for the low price of about $60. In hindsight, it cooked fine for the most part, but almost all of it was non-stick, and it didn't heat all that evenly. After a few years of use, the Teflon coating was chipping in places and the enamel outside was scorched and looked awful.

Shortly after our wedding, MLB and I purchased a new set of All-Clad cookware from their Stainless line. When I switched to the All-Clad cookware, I couldn't believe the difference, even over the decent T-Fal set. It heats very evenly, heats very quickly, and when used properly, is nearly as non-stick as the Teflon-coated stuff. Temperature control is more precise, and clean-up is cinch. I found myself cooking better purely due to the improved cookware.

“Wait a second. That sounds a little loony. You’re saying you became a better cook just by using better cookware?”

Absolutely. I’m not sure how I’d set up a test to quantify it (maybe a thermal gradient test or something), but I guarantee the quality stainless steel stuff improved my cooking. There’s no question in my mind that the heat is more even and the temperature control is more precise. An ultra-low simmer is now achievable across the whole pan, where before just the part of the pan directly over the burner was controllable.

“Okay, you’ve established that you’re a fan of All-Clad’s Stainless cookware. Can you be a bit more general?”

Absolutely. Here are some of my basic guidelines:

There’s no question in my mind that stainless steel is where it’s at. Stainless steel is non-reactive to 99.99% of foods, so it won’t stain or discolor like an anodized aluminum pan might. I'd choose to avoid non-stick in most cases (one 12" non-stick frying pan would be okay) because it shouldn't be used for browning, sautéing, or anything hotter than about medium-heat. More on that later. Plus, with shiny stainless steel surfaces, I don't have to worry about scratching all those silly non-stick surfaces with metal utensils like whisks and spatulas.

I’d also choose something that’s relatively heavy. Heavy pans retain heat well and distribute it more evenly than light, thin pans. A copper or aluminum core clad in stainless steel would also be a major plus in this area.

“…clad in stainless steel?” What the heck does that mean?”

Think of a clad pan like a plain turkey sandwich. The two pieces of bread would be stainless steel, and the turkey in the middle would be copper or aluminum. The stainless steel totally surrounds the inner metal. Copper and aluminum have a thermal conductivity (or k value) of five to ten times that of stainless steel, which means that pan will heat more evenly and rapidly than a purely stainless steel pan would. Basically, you’re getting the best of both metals: the conductivity of the inner metal, and the non-reactivity of the stainless steel.

Try to find something that has oven-proof handles. This makes it possible to go directly from the stovetop to the oven and vice-versa. That means no plastic handles! Well, some manufacturers have plastic handles that they say are oven-safe, but I’d still shoot for metal. The drawback to metal handles though, is that they can get pretty warm, especially on the lids. When it comes to attaching the handles, rivets are way better than screws. Quality pots and pans will have big thick rivets holding the handles to the main part of the pan. Because the rivets are deformed strong pieces of metal, they'll never loosen or wear out. Lower quality pieces have handles held on by screws that are more likely to corrode and loosen over time.

“Okay. I know basically what I’m looking for, but those clad stainless sets are pricey! I thought this was going to be a budget deal!”

It is. I’m not saying you need to plunk down a grand for a full set of pots and pans. Most recipes and cooking techniques require only a single pan or two. There's no doubt in my mind that you can get by with just some basic pieces, and here’s what I’d pick, in the order that I'd pick them:

- 12" frying pan - This will probably be your "everyday" pan. With a tight-fitting lid, you can slowly cook risotto, quickly sear a steak, or pan-fry some tilapia fillets. Preheated properly, and with just a tiny (and I mean tiny) bit of fat (like oil or butter), it's nearly non-stick. Make sure you get one with gently sloping sides so that you can easily flip your food. Also try to find one with a gentle radius where the bottom meets the sides of the pan. A nice, gentle radius makes it easier for whisks and spatulas to get in there and move things around.

- 2.5 to 3 quart sauce pan - Again, make sure you get one with a nice, tight-fitting lid. This pan will be absolutely essential when you make any sauces or small batches of soups or pasta. A second handle opposite the main handle is nice for pouring or draining, but it’s really not necessary.

- 5-7 quart casserole - This can be a rather expensive piece, but it'll be able to serve many purposes. It can easily handle big batches of pasta, soup, and with oven-proof handles, can even be used as a make-shift roasting pan and casserole dish.

"Okay, so those are the three critical pieces. What about any others?"

To be honest, the other pieces you'll get with a set are likely just slight variations of the above three pieces. Some are bigger, some are smaller, some are taller, and some are wider. If you find yourself saying "Gee, this would work a bit better if this pot were a bit wider," pick up something that fits the bill. You may be happy with just those three pieces.

Personally, I've got several frying pans, and several other pans, but I nearly always reach for the above three pieces. Seriously.

"Okay, all these pans you've mentioned so far are not non-stick. I'm scared to fry an egg on anything but Teflon!"

I understand. If you've tried to cook something high in protein (like an egg or cheese) on a cheap standard pan, it's likely that it stuck. So, now you're apt to use Teflon as your crutch. Fine. I'll agree that there are some foods that are a bit easier (and less nerve-wracking) to cook on Teflon. If you absolutely must buy a non-stick pan, make sure you look for certain characteristics.

First, make sure that the Teflon coating is very smooth. There are a lot of non-stick pans out there that are ridged or bumpy. I don't understand why. If you want something to slide around easily, why would you make the pan bumpy, and add surface area? Second, make sure that the pan is still high-quality and heavy. Even heating is still critical with a non-stick pan. Finally, try to find a pan that uses the same lid as the pans you already have. Lids take up lots of space, so the more they can do double-duty, the better.

"I've completed my shopping list and I think I'm ready to buy. But, I'm a little queasy about maintenance and cleanup. Won't stainless pans be a pain?"

Not at all. Even with the worst baked-on gunk, my All-Clad stuff cleans up easily. You've just got to remember to get it clean in a reasonable amount of time. If you leave a pan sit overnight with burnt crusties on it, it'll be much tougher to clean that if you just cleaned it right away.

Most of the time, my pans clean up with just soap and water and a sponge. If it's tougher gunk than that, it may have to soak in soapy water for a couple of hours. Only occasionally do I use a fine powder cleanser to get the really stubborn stuff. Check with the manufacturer of the pans you choose, but they're likely dishwasher safe, too. That's great for when you're really lazy like me.

"Throughout this whole post, you've been pretty anti-non-stick. How come?"

A couple reasons. First, aside from crepes it's almost never necessary, and I don't want to have a ton of pans cluttering up my cabinets. Second, Teflon gives off toxic gasses at high temperatures. This outgassing is fatal to pet birds (not that I have one) and can cause "polymer fume fever" or "Teflon flu" in people. That's why you should never do high temperature cooking, like sautéing or broiling in a coated pan. Third, it limits your utensil usage. Teflon can be easily gouged and scratched with metal utensils, and sometimes a wire whisk is the best way to get the tasty bits off the bottom on the pan. I figure that the less I have to concentrate on not scratching my pan, the more I can concentrate on the food.

So, if you're still a non-stick user (and I am too, occasionally), just make sure you never use range heat higher than medium, never use metal utensils, and never broil in your pans. If you're okay with that, they should last a long time.

There are certainly places to save money when stocking a kitchen, but I don't think cookware is the place to do it. Besides, when you purchase quality cookware, it should last a lifetime, and I fully expect to pass my All-Clad set down to my children eventually. There's no doubt that high-quality cookware is expensive, but to me, the All-Clad Stainless cookware is worth every penny.

YFNN

Gourmet Kitchen on a Budget: Part One

2007-08-06T16:36:00.000-05:00

I do a pretty significant amount of cooking at the YFNN homestead, and while I'm certainly not a trained expert chef, I'm pretty darn skilled. When we have folks over for dinner, I'm occasionally asked why I use the equipment that I do. Most are pretty shocked to find out that you don't really need to spend a lot of money for a well-equipped and safe kitchen. So, I thought I'd put together a couple of posts about the subject. Basically, of I were going to restock my kitchen from scratch within a reasonable budget, what would I get and why?

I'll start with my favorite equipment: knives.

Knives are an absolutely critical component to an efficiently-equipped kitchen. The important thing here is to buy decent quality, sharp knives, for a couple of reasons. First and foremost is safety. Cheap knives and more importantly, dull knives are a safety hazard. Yes, that's right, dull knives are much, much more dangerous than keen, sharp ones. Here's the reason: Say you want to slice an apple up for a Waldorf salad. When you use a dull, cheap knife, you have to use much, much more force to cut through the skin of the apple (or tomato, or whatever). All that extra force has the potential to cause a slip and then the tip of your finger can decide to make a swift departure. With a sharp knife, you just slice right through.

The second reason to buy some quality knives is longevity. Cheaper knives are typically made from carbon steel or stainless steel and wooden handles.

"Great! Stainless steel is really resistant to rust. That's perfect for a knife!"

Not quite. First of all, it's important to remember that it's stain-less steel, not stain-free steel. Improperly handled, stainless steel with certainly corrode. Second, regular stainless steel isn't very hard as far as metals go. Because of this, it doesn't keep an edge well, and as stated before, a dull knife is frustrating and dangerous. Avoid regular stainless steel knives. They're typically labeled with "18-8" or "surgical stainless steel."

"Okay, carbon steel it is. I'll have to be careful about rust, but at least it'll stay sharp."

Well, high-carbon steel is a good knife material, but it's certainly not stain resistant. High-carbon steel knives will rust, and well-used blades will turn black, even with good care. With the way I tend to leave knives in the sink and such, that's not a good choice either.

So what's left? Well, it's kind of a combination of the two. Good quality knives are typically made from high-carbon stainless steel. Most companies have their own proprietary blend of steel that they use. They keep a nice sharp edge, and they're very stain resistant. So, keep an eye out for "high-carbon stainless steel" construction.

“Okay, so what about the handles?”

Most low-end and even some very high-end knives come with wooden handles. High-end wooden handles are comfortable and luxurious, but wood tends to harbor bacteria and other creepy-crawlies if it's not perfectly maintained. Plus, if they get wet (or are run through the dishwasher), the wood can split and deteriorate. Other options are stainless steel or plastic composites. In my opinion, either is a fine choice. I personally like the warmer, softer touch of the plastic handles.

"Okay, so I'm looking for high-carbon stainless steel knives with plastic or metal handles..."

Hold on, there's more to the story. You've also got to think about knife construction. The construction method of the knife defines its balance and heft, both of which are important to ease of use and comfort. Most cheaper knives are stamped, or blocked. Basically, the blades (and the inner part of the handle) are stamped from a single sheet of metal, much like cutting cookies from cookie dough. The cut-out shapes are then ground for the edge and the handles are riveted or glued to the handle portion (or tang). This produces a lightweight knife that usually isn't well balanced. A better way to manufacture a knife is to forge it. Think of a medieval blacksmith hammering a sword out of red-hot metal on an anvil. That's essentially how a forged knife is made. Well, except nowadays they use big heavy presses and machines, but you get the idea. This method of manufacture allows the knife to have a bolster (a thick section between the blade and handle), and a more pronounced spine. This is good because a stronger spine means less flexing and bending, and the bolster adds to the heft and feel of the knife while helping to really balance it.

"High-carbon stainless steel, plastic or metal handles, forged blades. Got it. How many of these higher-priced knives do I need?"

Actually, not too many. You could go out and buy a set of knives that would have everything from a tiny paring knife to a huge 10" meat cleaver, but most wouldn't be necessary. It would be much more cost effective to pick up a few essential pieces right away and add to your collection as needed.

Here's what I think is essential:

- A good chef's knife - A decent chef's knife is my #1 tool in the kitchen and it's the knife I'll reach for nine times out of ten. It chops, it dices, it'll slice when necessary, and it'll even strike (like for cutting through bones) when it has to. It's the do-all knife. An eight to ten inch chef's knife is absolutely critical to a properly equipped kitchen.

- A paring knife - A paring knife is perfect for peeling vegetables, making decorative cuts, and for more detailed work. It'd be pretty stupid to try to peel an apple with any other knife.

- A slicer of some sort - Slicers have long, thin blades for less drag, and may or may not be serrated (toothed). They're perfect for slicing soft bread, a big pork tenderloin, or nearly anything else. If I had to pick just one, I'd pick a long (ten inches or longer) serrated bread knife. Bread knives can cut more than just bread, you know.

Everything else is certainly nice to have (I love my Japanese Santoku knife), but are not really necessary. Those three knives will get just about any job done.

"So, FNN, what do you personally use?"

I personally have a full set of Wusthof Grand Prix II knives, and I wouldn't trade them for the world. I absolutely love, love, love them. If it were safe and socially-acceptable to make out with cooking equipment, I'd be more than happy to smooch these knives like crazy. They're rather expensive, but certainly worth it to me.

Other good choices would be this design from Farberware or any Henckels knife.

"Ewww. You are creepy and disgusting, and you're gonna get hurt! Let's move on. So, how do I care for and maintain these new beauties?"

Well, it's really not that tough, but there are a couple of critical things to remember. First, use a good cutting board. I refuse to use anything but the plastic ones, for a couple of reasons. First, is safety. I absolutely hate glass cutting boards. Hate, hate, hate them. The food slides around, creating a safety hazard, and the hard surface dulls a knife super-fast. Plus, you have to worry about them breaking, and I don't particularly care for glass shards near my food. On the plus side though, they're dishwasher safe, maintenance free, and they don't harbor bacteria.

Then, there's your grandmother's favorite wooden cutting board. Sure, it's easy on the knife and the food, and those butcher-block boards sure are pretty, but that's about all it's got going for it. They can't be put in the dishwasher because they'll split and age, and they have to be oiled and sanded now and again so they stay nice and don't dry out. Plus, since they lots of little ridges and valleys and holes and can't be put through the dishwasher, they're great at storing little nasties like bacteria and such. Yuck. Add the hefty price tag for a quality wooden cutting board and you've got a real loser on your hands. If you absolutely have got to have a wooden cutting board, please only cut foods you intend to eat raw, like vegetables or fruits. No raw proteins like fish, meat, or poultry!

Nope, as far as cutting boards go, the only choice for me is plastic. It's cheap, durable, sanitary, and easy to maintain because you can just pop 'em in the dishwasher. My favorite cutting board is a big, thick one about the size of a large cookie sheet. It's even got a juice groove running the perimeter so that when I slice up a pineapple or a perfectly-cooked pork tenderloin I don't get juice all over the counter. Plus, it's so inexpensive that when it gets really hacked up, I can get another one for only a couple of bucks.

"Okay, you've digressed again. Can we get back to maintenance, please?"

Yeah, sorry. Okay, so as you use your knives, they eventually start to dull. Basically, your sharp edge becomes slightly bent on the microscopic level. However, all is not lost; you can fix most of the problem by using a steel before you use your knives.

"A steel? Didn't we already cover metallurgy?"

Not that kind of steel. A steel is that "sharpening stick" that makes that great "zzziiiiinnggg!" sound when you move your knife across it. It basically straightens out all the tiny bends that can create a dull knife. It can be a bit tricky to use at first, but this video should help. I use my steel right before I use any of my knives. It only takes a few seconds, and I love the way it makes that awesome ninja-sword zing sound.

Since a steel just straightens the knife's edge and doesn't really remove any metal when you use it, there will come a day when a steel just won't get the job done and you'll have to have your knife sharpened. Please, please, please don't use one of those home sharpening gizmos or try to do it yourself at home on your garage grinder. Sharpening a knife correctly is a complex dance of angles, pressure, materials, and skill and should only be done by a professional. It only costs a couple bucks per knife and if you're using your steel properly, it shouldn't have to be done more than once every couple of years. There's likely a professional sharpener near you, and if not, many manufacturers will allow you to send the knives back to them and they'll sharpen them.

Finally, don't put your knives in the dishwasher. They'll just bang around and hit other knives, the racks, plates and who knows what else. The blades will be duller than a butterknife in no time, and your handles will not appreciate the steam and dry heat, especially if they're wooden. Take a few minutes after you're done cooking and wash and dry them by hand.

So, that's my take on knives. I know this post was lengthy, but I really think these are the most important tools in the kitchen.

Finally, when you get some favorite quality knives, don't be afraid to give 'em a kiss now and then. They deserve it.

YFNN

The Itch to Learn

2007-04-18T16:49:00.000-05:00

Okay, so it's been almost a week since I wrote a post here. Where have I been? Why haven't I written? Frankly, it's not really any of your darn business, but it's mostly because I'm a lazy oaf. I've been busy with work, the motorcycle, and lots and lots of unadulterated, self-indulgent laziness. Regardless...

The last 59 months have officially been longest stretch of my life away from an educational facility. Be it college, high school, or kindergarten, I've never been so far removed from schooling. Add that to the fact that my little brother just graduated from college, my little sister will be receiving her Master's degree in a short couple of weeks, and my mother is nearing completion of her Doctorate degree, and I'm starting to feel like the most uneducated moron to don the family name.

So what does this actually mean? It means that I've got the itch to do something educational. Likely, that'll mean my getting my MBA.

I'm fortunate in that TCFWIW will pay for a good portion of my schooling, if I so choose. They probably won't cover the entire bill, but anything is better than nothing. In fact, they'll even foot the bill up-front, which seems to be a bit of a rarity.

Also, time is something that is now available to me, for the most part. I've settled into my position at work a little better, so the hours are shorter, MLB's and my wedding is over and done with, and the household in general is pretty stablized.

It seems the stars are aligning for YFNN's higher education. I'll keep you informed.

YFNN

More RD250 Progress

2007-04-12T15:06:00.000-05:00

I've spent the last couple nights working hard on the restoration of my 1975 Yamaha RD250 (NOT the bike at right). I've taken what seems like a couple dozen parts to TCFWIW to perform some restorative work on them.

The majority of the parts are steel, and the black paint on them has weathered off long, long ago. Due to the paint's slow disappearing act, rust has decided to show itself, sometimes in large, destructive amounts. Fortunately, like I said, most of the parts are steel, so repair is not that difficult.

So, I loaded up the family truckster with some parts, some tape, some spray automotive primer, and some Rust-Oleum Rust Reformer and headed to my place of employment.

I'm lucky to have place like I do to perform this kind of work. The company for which I work (TCFWIW) used to have full-scale manufacturing capability under its expansive roofs, but as of late 2004, it's moved on. But, the large and well-equipped model shop has remained intact. Since the place is pretty lenient about after-hours work (especially if you're friends with the facility manager), I've got a full shop at my disposal whenever I'd like.

When I got to work, I let the guard know I was going to be there for a couple hours and toted my stuff inside. I powered up one of our solvent baths and made short work of all the grease, oil, and grime that had built up on the parts over the years. The swingarm was the worst. because of the drive chain, I'm sure.

Once that was completed, and the parts were thoroughly dried with compressed air, I fired up one of our media-blasting cabinets and went to work on the parts. Because the media and the through-wall gloves were recently replaced, getting rid of the rust and old paint was a comfortable and easy task. As I finished cleaning each part, I made sure it was dust-free and hung it in our paint booth. Some automotive primer did a great job covering the bare metal. In the places where the sandblaster couldn't remove some of the rust, the part was hit with some Rust-Oleum Rust Reformer (which is good stuff, by the way).

A couple of the parts had some pretty severe rust damage, so I had to fire up the welder to add some metal to them and then reshape them. Fortunately, that was pretty easy, and I got them cleaned and primed as well.

I left the parts hang and cure all night, and they should be ready for another coat this evening. Soon after, I'll hit them with some satin black and some clearcoat and they should look good as new. Heck, even in just primer, they look pretty darn good.

I've still got to find a place to blast and powdercoat the frame, though. unfortunately, all of the cabinets at work are too small to fit the frame, and I'm not going to make a mess of the backyard with an external blaster. Besides, I'd rather have the frame powdercoated, so I've got no issues paying someone to do it.

I also recently received the new (well, undamaged) steering stem and triple clamps, to replace my damaged ones. That's a headache lifted. I thought for sure that I was going to have a really difficult (and expensive) time figuring out how to replace the stripped threads on the main stem. I did a lot of swearing when I found that lovely surprise.

All in all, things are cleaning up pretty well. Once the frame is painted, I'm pretty much ready to start reassembling.

Once the paintwork is done, it's time to order a few new parts!

YFNN

Dumb Things I Do All the Time

2007-04-09T07:30:00.000-05:00

After reading a post on a personal finance blog about dumb things the author does on occasion, I felt rather inspired to create my own list. But, I'm not going to limit mine to just personal finance, mostly for your entertainment. Now, I'm a pretty smart guy. I got good grades, I've got an above average IQ, I excel at most things academic, but I still do some REALLY dumb things on a daily basis. Really dumb. Here's a short list.

1) Hit the snooze alarm about 6 times every morning.
My alarm goes off about an hour before I really need to get up. Every night, I think that I'm going to get up when the alarm goes off the first time and take my time getting ready and enjoy the morning. Does it ever happen? Of course not. I hit that snooze button every nine minutes until I'm 30 minutes away from having to leave. The real kicker is that I'm sure that hour of intermittent dozing does absolutely nothing for my rest, and it drives MLB crazy. Yet, every day it continues. Dumb.

2) Put off doing laundry until the absolute last possible day. My laundry hamper typically overflows onto the floor several days before I decide it's time to do laundry. What this means is that when I decide to do laundry, it ends up being an all-day chore, and I hate doing laundry. It makes for a miserable day. I'm sure it'd be much less painful for me to just do a load or two every couple of days, rather than all at once, but I never do. In fact, I've even gone so far as to buy new underwear so I could put off laundry a couple more days. Also dumb.

3) Buy a soda for the drive home.
I know it's expensive, I know it's a poor choice, and I know it's intentionally marketed this way, but I always do it. It never fails that when I go to the grocery store (or Target, or Lowe's), I'll pick up a bottle of soda on my way through the check-out lane. Why? Well, because I'm thirsty. Why can't I wait the four or five minutes until I'm home and get a drink of water? Because I'm dumb. Those check-out lane coolers get me nearly every time.

4) When working in the garage, place a tool down someplace unusual and think "I'll remember where I put that because it's an unusual place for it."
For example: If I'm underneath the car, I'll place the ratchet on top of one of the tires, rather than back in the toolbox or on the floor next to me. Then, when I'm ready to use it again, I spend ten minutes trying to figure out where the heck I put it. Or, I'll put the notes for the motorcycle restoration in with the sandpaper, thinking "I'll remember that," and then waste 45 minutes later in the day. Dumb.

5) Leave my cellphone at work.
I don't get very good reception at work, so I typically leave my phone charging on my desk all day. As I leave, I'll bet four out of five workdays, I leave my cellphone in my office. Usually, I'll remember as I get out to my car and have to go back in the building, unlock my office, and retrieve the phone. Somedays, I forget until I get home. I leave it there on my desk, just charging away 80% of the time. Dumb.

So, that's a good start. Maybe now that I've put these dumb things into writing I'm stop doing them. Not likely, but maybe.

YFNN

S-S-Smoking!

2007-04-05T15:29:00.000-05:00

I'm no stranger to mechanical things, especially vehicles. I've spent a good portion of my life lying on my back on a piece of cardboard on concrete. I know the difference between a flat-tappet and hydraulic roller cam, and I think my fingernails are permanently grimy. I was the president of the Purdue Automotive Performance Association in my college days (back when it was about good friends and fast cars, NOT the bling-bling competition it is now), and have helped to build more than a handful of road-going rockets. I even spent a portion of my career with a professional race team, building racecars and chasing horsepower. It's pretty safe to say that if it's got an engine, I'll like it.

Last fall, I bought an old motorcycle as a project for super-cheap. It's a 1975 Yahama RD250B, US model. When I picked it up, it was pretty beat up, rusty, and older than I was. It's tiny by today's motorcycle standards and it sounds like pissed-off weedwhacker on steroids. But, it was so darned cool and with only 2000 original miles, I just had to put some wrenches to it.

However, it's provided me with some challenges so far, mainly because it's very different from what I'm used to working on. First, since it's older than I am, it's carbureted and I'm a fuel injection guy. I'm more comfortable adjusting injector pulse widths than I am changing jets. Now don't get me wrong, I fully understand how carbs work and how to adjust them, it's just not something that I've ever had to do.

Second, this bike is a two-stroke. A smoker. It's a high-revving, oil-injected, cam-less wonder, which is also new to me. Running down the road, it spews healthy blue smoke out the tailpipes and sounds absolutely vicious. Apart from my weedwhacker, I've never touched a two-stroke engine. I'm most amped about this aspect. There's just something completely appealing about a loud, fast, polluting, smoking, relatively unsafe, 30-year old, rolling piece of history. It's just so, um, irresponsible. I absolutely love it.

Third, it's a serious restoration project. I'm not a restoration guy. I'm more a modern-day, horsepower-building, racecar guy. This bike needed to be stripped to the frame and completely redone. That is very different from what I'm used to doing.

So, it's definitely going to be a challenge.

As of today, the bike has been completed stripped down to the frame, and the frame itself is ready to be sand-blasted and painted. I meticulously documented and photographed every part and bolt that came off, so I know exactly how it's supposed to go back on.
I've measured every single fastener that has come off the bike and have kept a log of their location, thread size and length, so that they can be replaced with new ones. I've kept a notebook with more notes that I care to remember, and have lots of labels all over every wiring harness and connectors.

It's going to take me a while, and I'm sure I'm make some bonehead mistakes, but so far, I'm having a blast working on it.

YFNN

New Graduates and Focusing on Finances, Part Five - The Final One!

2007-04-04T14:20:00.000-05:00

Finally, the last two foci on my list! I apologize for the long delay; the weather here has been beautiful lately, and I spent a lot of time in the garage putzing and working on the '75 Yamaha. I even took a half-day of vacation on Monday so that I could best use the great weather and continue my progress on the restoration. More on that later. Regardless, here's #9 and #10!

Focus #9: Create and maintain a budget.
This document is going to be your rock. It will guide you, help you make good, sound decisions, and keep you focused on your financial goals. It will keep you grounded and set you free at the same time.

It is absolutely imperative that you learn to work with a household budget. There's lots of good websites out there to help you get started, but here are my main points:

1) Know where you money is going. Track each dollar that you spend. You'll quickly realize where the leaks in your spending are, and where you can save some money. Once you know where it's going, you can make better decisions regarding where it should be going.
2) Give each dollar a job. Make sure that each dollar you receive in income is given a job. Make sure each income dollar is either put towards an expense, saved, or invested. Once each dollar has a task to perform, it's much more difficult to waste them. Idle dollars are easily blown on frivolous things.
3) Most importantly, spend less than you earn. That is the ONLY way to get ahead. If you're consistently spending more money than you have coming in, you're in a downward spiral into financial disaster.

I used to have a very elaborate spreadsheet that performed all the calculations, did all the tracking, and reminded me of bills. But, it got to be very big and clumsy. Now, I use a small program called YNAB Pro (available at www.youneedabudget.com). It works beautifully.

Focus #10: The time to invest is now!
Compound interest is a beautiful thing. The earlier you start investing, the more time you have for it to work for you. More than any one mutual fund or stock selection, the age you start investing will determine how much wealth you actually build. This may be difficult for some to grasp, so here's a real-world illustration:

Employee A, we'll call him Dave, starts putting away $100 a month when he's 22 years old, right after he graduates. Dave's money grows at a conservative 8% a year, and after ten years on his 32nd birthday, he decides to stop contributing and just let the money grow. Employee B, we'll call him Phil, graduates at age 22 but waits until he's 32 to start investing for retirement. He sets aside the same $100 a month, gets the same 8% return, but continues investing until he's 64 years old. So, who's got more money at retirement?

Dave does. When they both retire at 64, Dave will have $234,600 and Phil will only have $177,400. Even after only contributing 1/3 of the money that Phil did, Dave's way ahead. If Dave had just continued to contribute the same measly $100 a month until 64, he'd have $412,000! That's over $175,000 more than Phil, just by starting ten years earlier.

The lesson here is to start saving early!

To review my Ten Financial Foci:

Focus #1: Get a good, low-fee checking account and know how it works.
Focus #2: Use direct-deposit.
Focus #3: Get a high-interest savings account.
Focus #4: Start an emergency fund and feed it automatically.
Focus #5: Don't fall into the lifestyle trap.
Focus #6: Ditch your debt.
Focus #7: Make sure you're covered.
Focus #8: Take inventory.
Focus #9: Create and maintain a budget.
Focus #10: The time to invest is now.

I hope the foci I outlined over the last couple days have been insightful and inspiring to new graduates or future graduates. Getting a focus on your finances now, when you're still young is immensely beneficial later on. So, pass these lessons on to any graduates you might know!

YFNN

New Graduates and Focusing on Finances, Part Four

2007-03-30T15:14:00.000-05:00

Numbers seven and eight!

Focus #7: Make sure you're covered.
You may not have thought much about health insurance as a student, but ignoring insurance now could be a pricey mistake. If you decide to go uninsured, you could wind up with expensive medical bills, not to mention poor health. You've got to make sure that you're covered in case of an emergency. At this stage in your life, you're likely pretty healthy, in decent shape, and unlikely to need regular prescriptions, but you've got to have insurance to cover the emergency situations. You're probably no longer able to be pulled along with your parents' insurance, so you need to find your own.

You likely have several options. First, your employer may provide insurance (at a reduced cost) to you. This is probably going to be your least expensive alternative, but many companies won't provide you with insurance until you've been employed for three or six months. Buying your own health insurance is an option, but it's expensive. The average annual cost for a traditional insurance plan is around $4,000,

I also recently learned that college grads are eligible for COBRA when they're no longer considered a dependent. College students who are on their parents’ health plans can sign up remain covered for up to 36 months after graduation. But, you must notify your parent’s insurer that you would like a COBRA extension within 60 days of graduation.

A COBRA extension certainly does have costs, though. You may be required to pay the entire premium for coverage up to 102 percent of the plan’s costs. In other words, you will be responsible for 100 percent of what your parents paid, plus what their employer paid along a 2 percent fee. Ouch.

Finally, you can get some short-term health insurance for relatively low cost. This type of policy is designed for folks without pre-existing medical conditions, and only offer coverage for 12 months. But, they're typically bought in one-month increments, which makes it easy to drop when you get an employer-sponsored insurance plan. One big drawback is that short-term insurance does not typically cover routine preventative care, like physical exams.

Your insurance coverages don't stop at just health insurance. Consider renter's insurance to protect your sweet autographed guitar and other valuables you've already acquired. It's relatively cheap protection, even if you don't have a lot of stuff. You definitely need to be covered in case of fire, theft, or other event.

Focus #8: Take inventory.
If your apartment or house burned down or was robbed tomorrow while you're at work, would you be able to remember exactly what was in it, down to the value of any jewelry or what kind of appliances you had? Me neither. That's why an up-to-date home inventory is something you should spend an afternoon putting together. This list of items will help you get any insurance claims settled faster (with better accuracy), verify your losses for your income tax return, and help you assess how much insurance you need to carry.

Putting it together is simple, especially if you're just setting up a household. Make a list of your possessions, describing each item and estimating its value. Also try to include where you bought it, and its make and model if at all possible. A spreadsheet is the perfect tool. At a bare minimum, include your big ticket items. If you've got the time and ability snap some photographs of your stuff, too. Scanned receipts would also be smart.

Then, store a copy of your inventory someplace safe, AWAY from your home. A relative's house or a safe deposit box is a good choice. MLB and I burn a copy of the photos and our list to a CD and keep a copy in our safe, and I keep a copy locked up in my desk at work. This way, if our home is ever damaged, our inventory isn't.

The final two tomorrow!

YFNN

New Graduates and Focusing on Finances, Part Three

2007-03-27T16:31:00.000-05:00

Continuing the previous couple of posts, here are foci five and six.

Focus #5: Don't fall into the lifestyle trap (not yet, anyway).
It's all so appealing. You worked hard for the last several years and it finally paid off. You're out in the real world, making the big bucks. Surely you deserve that high-end apartment or that shiny new car, right?

Don't fall into that trap. Think about it. You've been living like a college student the last several years, and you've fallen into a routine. You're used to not eating out very often, pinching pennies on expenses, and putting off expensive purchases. You don't mind eating store-brand macaroni and generic cereal. When will it ever be easier to keep expenses so low and put back tons of cash? The answer is never. Once you find yourself financially able to enter the world of fine dining, fancy cable packages, and a shiny new car payment, it's darn near impossible to get out. Use this time to put back some money and pay off your debts. A little bit of painless scrimping now will pay off big in the future.

Focus #6: Ditch your debt.
If you're like the vast majority of the graduates in this country, you're probably graduating with some credit card debt, and maybe even some student loan debt. Now is the time to eliminate it for good! Debt is going to do absolutely nothing but hold you back for the next several years. Call up your student loan lenders and inquire about consolidating your loans at a lower interest rate. Call up your credit cards and talk down their rates. Do everything you can to minimize interest's impact.

As I said above, you're probably used to living the meager college life right now, and it's not that hard to continue living that life for a few months or a year. Now is the perfect time to pay down your debts with that extra cash.

Numbers seven and eight still to come!

YFNN

New Graduates and Focusing on Finances, Part Two

2007-03-26T09:29:00.000-05:00

On Friday, I wrote about the first two foci I think a graduating college student should have as they begin their new life in the working world. Today, I'll continue with the next two. (Yeah, I know I technically said "tomorrow" on Friday, but I had a hectic weekend of dog-sitting. Trust me, they're monsters.)

Focus #3: Get a high-interest savings account.
I've already spoken at length of the benefits of the high-interest savings accounts like ING Direct and HSBC available on the internet. They provide security, flexibility, and an interest rate that actually makes you some money. In order to have a place to stash some cash for both short and long-term savings, you need a high-interest savings account. My favorite, for a plethora of reasons, is ING Direct. So, get an account, transfer your first dollars, and familiarize yourself with their functionality.

Focus #4: Start an emergency fund, and fund it automatically.
It's absolutely critical that you have an amount of money easily available to you for emergency situations. Things go awry in the real world: roofs leak, cars break down, and ambulance trips are required. In order to keep on track for your long term financial goals, you've got to have an emergency fund to cover these unexpected events. Ideally, you should have about six months of living expenses, but for most graduates (in fact, most people in general), that's a pretty tall order. At a bare minimum, keep at least $1000 earmarked for emergencies.

You've also got to fund it automatically. It doesn't have to be much (MLB and I only put in $40 a month), but it does need to be regular. This helps to avoid excuses like "I'll put some money in next week," and, "I just forgot last month.", and keep you on track. Finally, you need to completely forget that you even have an emergency fund exist, right up until you need to tap into it. No using it for TVs or guitars!

Numbers five and six will continue tomorrow.

YFNN

New Graduates and Focusing on Finances, Part One

2007-03-23T13:27:00.000-05:00

My little brother graduated from college last weekend (congrats Dave!), moving into the real world: a world that can be frustrating, confusing, and certainly financially challenging, especially when you're first starting out. So, that got me thinking: What do I wish I would have known when I first graduated? What information would have helped me get off to a great start? I think I've come up with a pretty good list, and, since I'm a bit of a money fanatic, I think it makes sense to focus primarily on finances.

So, over the next couple of days, I'm going to write a few short posts about how to really get off to a good start financially if you're a new graduate. I'll try to focus on the financial decision-making, but I can't promise that my mind (and writing) won't wander into other areas. I'm going to try to keep it to two main points each day.

Focus #1: Get a good, low-fee, checking account, and know how it works.
Your checking account is going to be your main pipeline for all things financial. Most of your expenses will be paid from it, and your paychecks will likely be deposited into it. Make sure that there's not a high minimum balance ($100 or less is good), and that there are minimal fees. Many banks offer "free checking" accounts that have no fees, no minimum balances and online banking. The downside is that they offer zero or very low interest rates. But, since I think your checking account shouldn't be a long-term storage area for your money, I wouldn't be too concerned about the rate. Try to find an account that provides a debit card or check card. I'm a big fan of debit cards because you don't need to carry cash, they're almost universally accepted nowadays, and the amounts are immediately deducted from your checking account.

It's also absolutely imperative that you understand how the checking account, as well as your debit card, works. Even in the era of 24-hour online access to your accounts, it's important that you understand debits, credits, and how they affect your account balance. Also, make sure you understand that your debit card IS NOT a credit card: you can't spend money you don't already have in the account. Keep tabs on your checking account balances frequently, so that you're always aware of how much money is available to you and so that you can spot any errors quickly.

Focus #2: When you've got that job, set your paycheck up to directly deposit into your checking account.
Direct deposit makes getting your paycheck fast, easy, and error-free. You don't need to drive across town to make a deposit, you don't need to worry about making sure you get to the bank by six, you don't need to worry about misplacing your check (and your money!). It makes getting your money into your account completely painless. Since your checking account is going to be your main money pipeline, the easier and more error-free it is to deposit your money, the less headaches you're going to have.

The next two foci will come tomorrow.

YFNN

APRs and APYs...What's the Difference?

2007-03-19T17:11:00.000-05:00

If you've got a credit card, a savings account, or any kind of loan, there's no doubt you've been exposed to APYs and APRs. They're both methods of stating interest rates, but what's the difference? When and why is each used?

First, a few definitions:

APR - Annual Percentage Rate
APY - Annual Percentage Yield
Compounding - Earning interest on previous interest

The difference between the two is all about compounding. The APR is the annual rate of interest, without taking into account the compounding of interest within that particular year. The APY does take into account all that extra compounding within the year. It seems like a pretty small difference, but it can actually add up to some major bucks. This is really better shown with some formulas, illustrating their inter-relationship.

APR = Periodic Rate X Number of Periods in a Year

APY = (1 + Periodic Rate)^(# of Periods) - 1

"Holy crap, FNN! I haven't had algebra since high school. What the heck does that mean?"

Okay, a more real-world example: Say you've got a credit card that has an APR of 18%. That means that each month, you're charged 1.5% of the balance (1.5% X 12 months = 18%). Pretty simple, right? Well, look at it from an APY perspective: plug the numbers into the formula:

[(1+1.5%)^(12 months) - 1] = 19.56%

That's a difference of over 1.5%!

So what does this actually mean? Well, if you only carry a balance for one month's period, you'll be charged 1.5%, or the equivalent yearly rate of 18%. But, if you carry that balance for a year, your effective interest rate becomes 19.56%. That higher effective rate is all due to the effect of compounding each month.

"That's all well and good, but I'm still not getting it. How does this affect me in a broader sense?"

Well, it depends on your perspective.

As a borrower, you should always be searching for the lowest rate. The lenders know this, and will usually specify their rate in the lower of the two methods, the APR. This is because it doesn't account for compounding, and is a lower number than the APY.

The reverse is true if you're the lender, like when you're shopping for a savings account. The banks will usually specify the larger number, the APY because it accounts for the additional compounding.

So, when you're comparing rates of banks, credit cards, mortgages, savings accounts and everything else in the financial world, you've got to make sure that you're comparing the same thing, either APRs or APYs. It can make a big difference in your wallet.

YFNN

Tax Refunds as Forced Savings

2007-03-15T18:26:00.000-05:00

Yesterday, I wrote post about the inherent evils of tax refunds. To summarize it in a sentence: You're being temporarily cheated out of your own money. I also mentioned the MLB and I intentionally receive a tax refund at the end of the year, even though from a number-only point of view, it's a terrible decision. Today, I'll outline why we still do it.

I'd imagine that everyone who chooses to receive a big tax refund at the end of the year does it for the same reason: trickery. It's a big psychological trick on ourselves.

I've stated before that I'm a fan of forced savings (self-forced, NOT governmental) because it creates a state of artificial scarcity. It's pretty simple: if I put $500 a month into savings automatically, that's $500 less a month I have to spend. This creates a situation where I'm forcing myself to make more prudent decisions about the money I do have available to spend. Since there are things that I must pay for each month (like the mortgage, food, electricity, etc.), the artificial scarcity situation forces me to cut back on unnecessary spending, like a new set of speakers for the living room, or several meals at restaurants, or new pair of motorcycle boots. By cutting back spending on these unnecessary items, we continue to live below our means and put back more and more money towards debt (mortgage, etc.) and towards savings (IRAs, etc.). This is a VERY good thing.

So, by having more money withheld throughout the year from our paychecks, we're implementing another forcing savings, payable in April. Now, this extra bit of money only amounts to about $75 a week, which when paid to us on a weekly basis, is very easy to waste on frivolous, useless things. It's too easy to say "It's only $10...", or "I'll save some money next week..." when you're paid in small amounts. But, when taken away every week, and paid to us at the end of the year, this amounts to a sizable sum of money. And, when MLB receive a big windfall all at once, it's easier for us to say "Wow, we better do something smart with this extra cash!"

Having said all this, it's probably not entirely necessary for MLB and I to do this. We're both rather prudent with our money, and certainly not wasteful. We've developed enough self-discipline to use our money wisely, even when it comes in small chunks.

Even though I'm a big numbers person, I'm not going to argue that you shouldn't get a refund. Do what works for you. If you're disciplined enough to make good use of those smaller amount of money throughout the year, then forgo the refund. But, if it helps you to save or spend more wisely, like it does for MLB and I, get the refund. You just need to realize that you're paying a slight financial penalty for doing it.

I, for one, am okay with that.

YFNN

Evil Tax Refunds and Human Resources

2007-03-14T20:23:00.000-05:00

With tax season here, millions of Americans are filing their tax returns and receiving sizable tax refunds shortly thereafter. To a lot of people, that extra money in March or April is like winning the lottery. But, in reality, it's just a sign that you're getting ripped off with your own money.

To understand why tax refunds are evil and what you can do about it, you really need to understand how the whole withholding and refund tax thing works. As I'm sure you're well aware, an amount of money is withheld from each paycheck to pay your federal taxes (and state, local, FICA, etc., but I'll only deal with federal for simplicity). The amount withheld for your taxes is dependent on how much money you earn, how many exemptions you claim, and how much additional withholding you allow.

"Exemptions? I think I remember seeing that on a form when I first started my job. Isn't that the thing where the HR lady just told me to put a zero or a one?"

Pretty much. Basically, that form you filled out is a W4. It helps to tell your employer how much money they should withhold from your paycheck to pre-pay your taxes for the year. That way, when tax day rolls around on April 15th, or April 16th this year, your taxes are already pre-paid (deducted from each paycheck) and the government doesn't have to worry about trying to squeeze you for the entire bill at once. When you receive a refund, you've essentially pre-paid too much money, and they're giving you the amount you overpaid back. The reason the smiling HR lady suggested that you only claim zero or one exemption is that it helps to ensure that the ignorant masses don't underpay their taxes for the year and aren't stuck with a tax bill in April.

“I’m still confused. I thought a refund was the government paying me?"

Think of it this way: Assume your electric bill only comes once a year. But, in order to make sure they get their money, the electric company makes you pay each month. Since they don't know exactly how much your bill will be for the year, they make a guess: say $110 a month. So, at the end of the year you've paid a total of $1320. But, what if your yearly bill only comes out to $1200? Well, you'd be refunded the $120 you've over-paid for the year. They're just giving the extra money back that you've paid them unnecessarily all year long.

So what can you do to keep from overpaying throughout the year? You adjust your exemptions. Basically, the more exemptions you claim, the less they'll withhold each paycheck, and the more money will end up in your pocket each month. But, if you claim too many exemptions, or withhold too much additional money, and they don't withhold enough, you'll end up owing money at the end of the year.

"Okay, so how come getting a nice big check for a refund is so evil?"

A couple reasons:

1) You're giving the government an interest-free loan. Basically, you're saying "Here's some extra money. I won't need it until April, so go ahead a use it until then."

2) You're cheating yourself out of additional interest money. When you don't pre-pay extra money, you have more money available to invest or pay off debts. That's pretty valuable time money-wise, since when it comes to interest, either on your mortgage, credit cards, or a savings account, time is money.

3) You're depriving yourself out of additional monthly cash-flow. Every extra dime you pre-pay the government is one less dime in your pocket each month. Those dimes could be used for groceries, the electric bill, or insurance.

Basically, loaning someone (the government in this case) money interest-free, while you could use the money is a very poor financial decision. From a purely financial, numbers-only standpoint, it's a no-brainer to try to eliminate your refund.

All that said, MLB and I are will be receiving a rather large tax refund in the next week or so, and we did it completely on purpose.

"What? After that long dissertation on why refunds are evil, you STILL get one?"

Yep, we sure do. More on why we intentionally make such a poor financial decision tomorrow.

YFNN

A Putterer and a Tinkerer

2007-03-13T16:17:00.000-05:00

I'm a putterer and a tinkerer. I putt in the garage, the kitchen, the yard and our basement. I tinker with my tools, my cars, my motorcycles and anything else mechanical that I can find. I'm happy as a lark just hanging out and performing menial tasks in some of the more manly areas of the FNN homestead. And that's exactly what I did this past weekend since ripping through the countryside on two wheels was not an option (yes, I'm still bitter).

I spent a good portion of the day this past Saturday and all of Sunday in the garage, enjoying the nice weather and getting in some solid, quality puttering. Since spring is right around the corner, I concentrated on getting some things cleaned up and ready for summer use.

The lawnmower was thoroughly checked over. It received an oil change, a clean air filter and some fresh gasoline. I cleaned and repainted the deck and performed one of my favorite garage tasks: sharpening the mower blade. For some reason, I just love donning some gloves and safety glasses letting the sparks fly.

I also prepped the snowblower for storage. I removed the remaining fuel with my brand new shiny transfer pump (I busted my old one), and gave it a good cleaning and a coat of wax.

"He waxes his snowblower!?!"

Yes, I wax my snowblower. It helps to keep rust away, and it helps the snow to slide off the paint in the winter. So what?

I also finished the small table I built for a friend's dog. It needed another good finish sanding and another couple coats of polyurethane.

The rest of the time was spent sanding and refinishing my workbench (winter projects had it pretty banged up), putting away the tools, odds and ends that had accumulated over the last several months, and giving everything a good cleaning and wipedown.

Now, that sure sounds productive, but I'll be the first to admit that a very large portion of my garage puttering is just that, puttering. I re-organize tool drawers, sort sandpaper, perform some basic cleaning, and just generally move stuff from here to there and back. But, I love it. I love listening to the radio (talk radio or baseball games in the summer) and just being around tools, dirt, and projects. I love the smells of gasoline, sawdust, and that wonderful hot-electricity smell that power tools emit.

If this is what retirement is going to bring everyday, I can't wait.

YFNN

Nerd vs. Manly-Man, Part Two

2007-03-12T17:15:00.000-05:00

The weather is getting warm in my part of the country, which means motorcycle time for YFNN. So, I spent a good portion of the afternoon on Saturday prepping my main motorcycle (not the restoration one) for another riding season. I pulled off the cover, disconnected the battery trickle charger and wiped away the small amount of dust that had accumulated on some of the bodywork. Just seeing the bike shine in the fluorescent lights of my garage after a four month hiatus got me feeling all tingly.

I wheeled the white and silver two-wheeler into the center of the garage bay and got it up on a stand so I could do some checks. I noticed that my license plate sticker was almost expired, so I retrieved the new 2008 one from the safe and I went through my routine spring inspection:

- change the oil and filter
- check the air cleaner
- check tires for flaws and check pressures
- check the drivebelt
- bleed the brakes
- check all bulbs and switches
- wrench-check all critical fasteners

Once all that was done, I filled it with some fresh 93 octane and pressed the 'engine start' button. It fired up on the first crank with no leaks and no unusual sounds. Then I took it around the cul-de-sac a couple of times to check the operation of the clutch, gearbox, suspension and brakes. No problems were found, so I deemed the bike ready to rock and roll for the spring.

After my little test-ride, I pulled back into the garage and shut the bike down. I looked back through the open garage door and the weather outside was absolutely gorgeous: 55 degress and sunny with little wind; for a cold-weather wuss like me, it was perfect for the first ride of the year. My eyes slid over to the leather jacket and gloves hanging on the garage wall, then to my selection of helmets. I was already anticipating the rush of acceleration accompanied by the glorious sound of a big-bore V-twin at wide-open throttle and I could still smell the freshly burned gasoline in the air. Manly-man personality was kicking in hard and I wanted to go for a country ride badly.

But, my more nerdy side quickly brought manly-man to a screeching halt.

During the winter, I de-activate all insurance on the motorcycles except for comprehensive coverage. I don't ride November through February, so it saves me a couple bucks a year to do the de-activation/re-activation dance once a year. Since it had been cold and snowy recently, I hadn't yet thought to contact my insurance agent to re-activate my insurance on the motorcycles. To make it worse, it was Saturday so I couldn't make a quick phone call to my agent to get the job done. The last thing I want is to get into an accident and not be covered by insurance, so my riding for the day was painfully limited to the four minute stint around the cul-de-sac.

Sunday was beautiful, too. Sometimes nature is so cruel.

Sigh.

YFNN

Old Age at 28?

2007-03-12T07:59:00.000-05:00

I'm only 28. I feel old.

Examples:

1) I can't drink a lot of caffeine anymore. In college, I used to be able to suck down a couple bottles of Coke doing some homework, and still fall right asleep. Shortly after that, I was drinking Diet Cokes all day long, sometimes up to nine or ten a day (soda is free at TCFWIW). But, one night I was sitting on the sofa, watching television with a Diet Coke in hand. My chest started to get tight, my left arm started to tingle, and I got that shortness-of-breath and heart thumping that you get when you get really scared. I thought "Oh boy, these are heart-attack symptoms and I'm only 26." So, I went to the doctor and had a stress test done, as well as lots of other scans. As it turns out, my health is very healthy, even more so than most people my age, and everything else was normal. So, the doctor turned to my diet. As soon as I mentioned the amount of Diet Cokes in a typical day, he stopped me and stated that was my problem. So, I dumped caffeine almost entirely, cold turkey. Those first two weeks were the most painful I've ever experienced. Relentless terrible headaches, sleepless nights, and general crankiness were par for the course. But, caffeine is gone and I'm likely healthier for it. I still miss that sexy silver can, though.

2) I play "mystery bruise" in the shower. When I was younger, it seemed like I could practically whack myself with hammer and show no marks. What daily injuries I incurred seemed to heal before my very eyes. Now though, I get bruises that I have no idea where they even came from. Did I run into a table? Did I bang my arm on something? Who knows for sure, but it seems like I get bruises for no good reason now. When did I become so fragile?

3) I went from an iron stomach to one of paper. In my younger days, I could eat two dozen super-hot buffalo wings, some chili, and some warm Dr. Pepper in one sitting and feel like I could run a marathon. Now, my stomach moans and groans just at the thought of a greasy pizza or Chinese food. What the heck happened?

4) I take vitamins. When I don't take vitamins, I'm sluggish, cranky, and achy. If I miss my gingko biloba, I'm stuck with a dull headache all day. Am I really this close to a shoebox-sized box of pills with the days of the week on it?

Like I said, reality smacks me around on a pretty regular basis, but Mother Nature has been more than happy to throw some extra jabs and uppercuts my way over the last couple of years. With my birthday coming up shortly, it sure seems like she's not holding back now.

If anybody finds a fountain of youth, let me know, okay?

YFNN

February Self-Tax Update

2007-03-09T17:31:00.000-05:00

Since I haven't written another post on my "Self-Tax" since the initial one, I thought it would be wise to write a quick follow-up.

For those too lazy to click the above link and read the general premise behind my self-tax, it's okay; I totally understand. Here's a nine-word breakdown:

I pay myself a 10% tax on poor purchases.

That's it.

Anyway, it's been four complete months since the implementation of the self-tax, and it seems to be pretty effective. Since January, spending on lunches out has dropped by over 60%, and since MLB doesn't really eat lunch at restaurants very often, it's been mostly because of my choices. I can definitely tell you the decision to eat a packed lunch or a Wendy's hamburger (oh, baby), has been affected by the penalty of the tax. Well, the tax and the fact that I had to move my belt tab out a notch in January. Ouch.

So, for the rest of the data freaks, here are the numbers and the matching lame excuses for January and February:

January: $193.65 paid in tax. This was pretty high for a couple of reasons. First, I threw a small birthday party for MLB, and I had to buy prizes, food, and some other odds and ends. That drove the number up. Also, we replaced our CRT monitors in the office with some pretty 19" LCD ones, which kicked the tax up by over forty bucks. The good news is that the tax from dining out dropped by almost 70%.

February: $254.31 paid in tax. I can blame a sizable portion of February's tax on MLB. She went on a bit of spending spree for clothing (deservedly, though), and had a rather pricey hair appointment, so that punched it up about seventy bucks. Add in a payment to DD's daycare (boy, does that topic deserve it's own post), and a new color printer for the office, and some passport renewal fees, and the result is a sky-high tax. Again though, dining out spending was way down from December.

So, all things considered, the tax has brought down our expenses by more than enough to cover the tax itself, as well as put a little additional money into savings. Both are very good things.

YFNN

Heat Yourself With a Fan?

2007-03-08T17:38:00.000-05:00

MLB and I operate our ceiling fans in the winter. We run them most of the time, actually.

"What?! Is he crazy? Ceiling fans in the winter?"

Yeah, crazy like a fox. Here's why: Ceiling fans can actually save on heating costs in the winter. The temperature of the air in a heated room varies in layers; it's stratified. Because warm air is less dense than cool air, the air near the ceiling is warmer than the air near the floor. A ceiling fan can help push the warmer air that is trapped near the ceiling back down into the room, de-stratifying (or breaking apart) the layers of air. This way, the warm air is circulated where it is needed (to the middle and floor of the room, where the people are), and the heating system doesn't have to work as hard to warm the room.

"Okay, I'll just walk over here and turn it on..."

Not so fast. It's not quite that simple; it has to be running the proper direction. Have you ever noticed that there's a small toggle switch on your ceiling fan? That switch controls the fan's direction, making it spin either clockwise or counter-clockwise. But, there's a catch. That switch isn't labeled with a "forward/reverse" sticker on most ceiling fans (none of ours, for sure). You have the beauty-conscious "form before function" folks to thank for that one.

"Great. I'll just flip that little toggle switch and..."

Hold your horses. It's a bit more complex than that. The direction the fan needs to turn is dependent on the height of your ceiling.

"Now I have to measure my ceiling? I'm all about saving money, but not if I have to do math. FNN, this is getting too complicated!"

Hang in there. I promise to keep it as simple as possible and you won't need a calculator. Basically, if you have a standard height ceiling...

"Whoa, whoa, whoa. A 'standard height ceiling?' Now, I'm a contractor?"

Alright, fine. Stand up. Stick your hand up in the air. Jump. If you can touch the ceiling, or almost touch the ceiling, it's a standard height ceiling, typically eight feet. If you can't touch it, and your tallest friend probably couldn't touch it, it's greater than standard height. See? No math required.

Anyway, if you have a standard height ceiling, then you want the fan to run in the reverse direction. Specifically, the fan blades should be running with the lower edge being the leading edge into the air. Having the fan run in this direction will pull the air in the room upward, which will push the warm air near the ceiling outward and force it to mix with the rest of the air without creating turbulence that you can feel. While it seems to be common sense that running the fan in the forward direction (as you would in summer) would also push the warm air down, it also creates a breeze in the room, which gives you an undesired cooling effect, much like wind-chill. Running it reverse avoids this wind-chill effect, but still mixes the air.

However, if you have a tall ceiling (greater than eight feet or so), you want to run your fan in the forward direction. Specifically, the ceiling fan blades should be running with the upper edge of the blade being the leading edge. This pushes the warm air near the ceiling down into the room. But, because the fan is far enough from you, the breeze that is created is dissipated before you can feel it.

"Okay, I got my fan running the right direction. So, how much can I save?"

Well, according to the manufacturer of the ceiling fan I installed last year, you can save about 10% of your heating costs in the winter. That's nowhere near the 40% you can save in the summer, but still noticeable. These savings are more noticeable homes with high or vaulted ceilings.

10% in the winter...and you didn't even have to do math.

Who's crazy now?

YFNN

Green Peppers and Gasoline

2007-03-06T19:45:00.000-05:00

This obsession that some people have with gas price fluctuations is getting way out of hand. People seem to think that gasoline is the only commodity whose price moves up and down on a weekly, or even daily basis, and that loads of money can be saved by shopping around. Truth be told, gas prices really aren't too volatile, especially compared to some other regularly purchased items.

When I get home from grocery shopping, I take my receipt upstairs to the office and go over it in detail. I do this for two reasons. First, I want to make sure that what I paid was correct, and that I wasn't charged something way out of line for toilet paper or ground sirloin. Second, I want to generate some illustrative data.

"Wait, did he just say 'generate illustrative data'?"

Yes, I did. Remember, I'm a data man. Things like this should no longer surprise you.

The prices that I paid for regularly purchased items (bread, milk, chicken breasts, green peppers, etc.) are logged in a spreadsheet (surprise!) and I track them over time, generating trend curves for their prices. For example, I can tell you what the low price I've paid for chicken breasts has been for the last six months, and I can tell you the average price I've paid. This way, before I head over to our Giant Eagle grocery store, I can see what I've been paying historically, and make a decision as to whether I should buy something now (because the price is below my average), or if I should wait until next trip. That said, my grocery-shopping methods and adventures should probably be another post. Back to how this relates to gasoline...

What I'm getting at is this: produce and meat prices fluctuate far, far more than gas prices ever have. Even when you throw out sale price ups and downs, they're still far more volatile. And, you can save more money driving across town for cheap vegetables than you can by driving across town for cheap gas.

Example: The last time I went to the grocery store for green peppers, they were priced at an outrageous $2.19 each at Giant Eagle. So, of course, I didn't buy them. However, I still needed them for a recipe, so I went to Kroger instead. They had them for $1.39 each. I bought two and saved $1.60.

Compare this to gas prices. I personally know people that will drive well out of their way to save a measly five cents a gallon on gasoline. But, by buying just two green peppers at Kroger instead of Giant Eagle I saved more money than buying thirty-two gallons of gas (more than two fill-ups) priced at a nickel cheaper. How absurd is that?

Furthermore, I use coupons at Giant Eagle and regularly save around 7-10% because of it. On a typical $250 a month food budget, I save $20 to $25 just by cutting out a few slips of paper from the newspaper. In order to save the same amount of money on 5-cent discounted gasoline in a month, I'd have to drive over twelve-thousand miles in only thirty days! That's almost as much as I drive in a year! I save far, far, far more money by clipping coupons than nearly anyone ever will by changing their habits about gasoline.

There are a ton of places you can readily yield more savings if given the same amount of effort that many people do trying to penny-pinch at the pump; green peppers and coupon clipping are just a couple. Yet, lots of people moan and groan about the fluctuations of gas prices and drive well out of their way for five or ten-cent discounted gas, yet completely neglect to clip coupons or merely price shop for other items. It simply doesn't make sense.

So why do we have this undeserved obsession with gas price ups and downs? I think it's simply because gas prices are constantly in your face around town and constantly pounded into your mind by the media. When was the last time you heard Katie Couric say "Kraft Cheese Singles hit their highest price in six weeks, today..."?

In fact, most prices look outrageous when you put them on tall signs in big numbers. If you see huge numbers displaying the price of gas every single day, you can't help but notice and track them, and of course, I still do. But, I certainly won't go out of my way to find the cheapest place to purchase gasoline.

Green peppers, though, is another matter entirely.

YFNN

Single-Wides and Disappointment

2007-03-05T08:47:00.000-05:00

Last week, I wrote a post regarding a plot of land that MLB and I were semi-interested in purchasing for our future homestead. Well, yesterday, I had opportunity to drive out to see it in person and scope out the surrounding area.

I can sum it up pretty succinctly with one word: disappointment. DD and I drove out on Sunday morning, stopping off at the dog park along the way for some exercise. DD had a great time running around and chasing tennis balls in the snowy grass for a while, and then he and I packed into the family truckster again and headed off to the property in question.

On the way there, I noted how long it was taking to get there. The numerous stoplights and small towns made the 20-mile route provided by Google seem nearly forty miles, but my odometer confirmed Google's assessment.

Once at the property, the real disappointment set in. The property itself was a squarish lot, but not on a corner as the map suggested. On each plot on either side of this property was a single-wide mobile home with a carport. The lot seemed much smaller than the property map suggested, and while it had the numerous trees the realtor's description mentioned, none of them were taller than six feet or so.

Most disappointing though, was the building itself. Perhaps I had myself too hyped up on thoughts of a well-kept building for use as a workshop. Although the garage was a fairly recent build (1998), it appeared much older, and was definitely not well-kept. The wood siding was rotting everywhere, the garage doors were dented and rusting, and the roof was crumbling. Apparently, the realtor's listing used a rather old picture.

To top it off, the lot is essentially unusable as a location to build a home. The garage was placed absolutely dead center on the lot. You couldn't put a house on the front portion of the lot because it'd be far too close to the road. You couldn't put a house on the back portion of the lot because it'd be blocked by a big garage. Placing a house on either side of the structure would place you far too close to a couple mobile-home dwellers that couldn't get their kids to fetch their big-wheels and toy shovels out of their yards before winter.

All in all, it was a pretty wasted trip, except in the mind of the little guy in the back of the car. DD had a fantastic time; he loved going for the ride and looking out the window at all the trees and hills. Getting the opportunity to run around like madman for a while and sniff a couple of doggie-butts I'm sure was a welcome break from the house. It's gotta get old sleeping on the floor in the office and pushing dog toys into my lap, trying to get me to play.

So, the search continues, or maybe not. We weren't actively looking for land; this property was just a timely opportunity. I'm sure MLB and I will discuss it, and we'll come to a better understanding as to what our focus should be. I did learn, though, that 2.5 acres isn't enough for what I'd eventually like to call home. Ten is probably closer.

Darn expensive privacy.

YFNN

Rant: ARMs and Due-Diligence

2007-03-03T16:32:00.000-05:00

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

due diligence
n.
1. the care that a prudent person might be expected to exercise in the examination and evaluation of risks affecting a business transaction

As I putt around the house on the weekends, I listen to the news of the week, either via XM radio or downloaded podcast on my iPod. Today, I happened to be listening to XM Radio, where a discussion was taking place regarding the number of foreclosures in today's housing market. The majority of the talk was regarding the big, bad mortgage lenders that provided adjustable-rate mortgages to folks looking to buy a house. These adjustable-rate mortgages, or ARMs, most of them anyway, are past their fixed periods (1-5 years typically), and are now, as their name suggests, adjusting. Wow, who'd a thunk it?

Apparently, there's a significant amount of people out there that are getting burned by these loans, which, in my opinion, is largely due to their own ignorance. This radio program actually had a soundbite of someone that said their payment doubled from a manageable $1200 a month to a payment of $2400 a month. They went on to say that they "couldn't afford the payments anymore" and "didn't realize that their payment would change." Several others were quick to jump on board and blame the lenders. Quotes like "I didn't know what I was signing," and "I never thought an adjustment would make my payment increase," were abundant.

I have a couple of points to make to these people regarding this, all of them pretty well summed up with the statements "Why did you not think or do research?" or "Why were you so lazy?"

First of all, at the time the vast majority of these loans were written, mortgage interest rates were at all-time lows. Let me say that again and really make sure that I'm absolutely crystal-clear:

All. Time. Lows.

If mortgage rates were at all-time lows, which direction did you think the variable interest rates would go? Maybe, um, up? I can understand that there are situations where ARMs are smart loans, but in nine loans out of ten, why would you take that risk when fixed rates were so low? I just don't get it.

I guess it really comes down to people buying into more house than they could really afford, which is stupid. If the only way you could afford the payments on the house was to go with an ARM, or worse, an interest-only loan, it's gotta be a pretty big red flag that you're almost certainly buying way more house than you can afford.

Second, I have absolutely zero sympathy for the people that claim ignorance and blame the lender in these situations. One of my number one rules for investing is to not get involved with an investment that I do not understand, and I think that rule definitely applies here. It's not like the lenders are hiding the information from the borrower. Every loan has their conditions clearly stated, and the information is easily available via the internet, bankers, or others. It is the responsibility of the borrower to perform due diligence and fully understand what you're getting into. If you need to, get a lawyer or a non-drunk friend (preferably someone that can read) to look it over and explain it to you. Claiming you didn't know what you were signing is yet another way of blaming someone else for your irresponsibility. It's your duty to understand it! Nobody is forcing your hand to scrawl your name. If you don't get it, don't sign it!

I guess what this really boils down to is that I'm just tired of people not taking responsibility for themselves, which has certainly become a disappointing trend in recent times.

Achieving Slide Enlightenment

2007-03-03T00:31:00.000-05:00

I've been in the post-college working world for several years now, nearly all of them in the engineering and management realm. So, it's fair to say that I've choked down my fair share of PowerPoint presentations. The vast majority of them are awful. Yes, including the ones from the wonderful employees at TCFWIW. Apparently, many people think they can animate or bullet-point their way to good communication. Boy oh boy, are they wrong.

Think about the last PowerPoint presentation you were forced to absorb. Was it full of distracting animations like text swirling around and star wipes? Of course it was. Was the text so tiny that you had to tune out the presenter just to concentrate on reading it? You bet it was. Did the presenter basically just read the slides to you? Without question. Admit it, you began reading their PowerPoint slide the moment it appeared in front of you, probably before the presenter even began presenting it. And more often than not, you were finished reading the slide before you even thought about paying attention to what the presenter was actually saying. It's okay, I've done it, too. So what do all these bad presentations actually mean to you, the presenter? When PowerPoint is used incorrectly, your audience will leave confused, uninformed and mentally exhausted. Not exactly your goal, is it?

But don't fret. Here are Your Friendly Neighborhood Nerd's tips to complete PowerPoint enlightenment.

Tip #1: Supplement, don't replace.
We've all done it. We've put together an elaborate PowerPoint presentation and to prepare, we just printed off a copy of the slides for our notes. Then, we read the slides to our audience, boring them to death. This is really, really bad, because as soon as that happens, PowerPoint is giving the presentation, not you. You've been replaced by a forty-dollar piece of software and an overhead projector. That, as the Germans say, is "nicht gut."

What's the remedy? Use the slides only for emphasis and highlighting points. Check out the presentation that Steve Jobs (CEO of Apple) gave this past September. At a minimum, watch the first 7-10 minutes. Notice how the slides behind him merely supplement the words he's saying. Notice how they only become important when he turns and makes them important.

Tip #2: Like a good steak, you've got to trim the fat.
In PowerPoint presentations, less is definitely more. More specifically, less text is more. Most PowerPoint audience zombies can only store four to six things in their short-term memory banks. Take a bunch of items on a slide, add in the fact that your audience will read them before you speak, and you've got a recipe for mass-confusion. The solution is simple - simplify. Start by drastically reducing the amount of text on your slides; especially, avoid bulleted lists at all costs. Aim for two to three word thoughts, avoiding complete sentences. A good goal that I shoot for is no more than six thoughts and no more than twelve words per slide. This simplicity has the added benefit of forcing the audience to pay attention to you and what you have to say, not the slides themselves.

Tip #3: Think about bunnies and Snuggle the dryer sheet bear.
Soft, soft, soft. Bright white backgrounds, with sharp, serif fonts are straining on the eyes, especially when presented on a big screen. Use an easy-to-read, sans serif font (what the heck is a "sans serif font"?) on a dark background to reduce eye strain as much as possible. Soft fonts with a non-distracting, dark background will keep your audience from going blind and subsequently tuning you out. Use some simple but illustrative images to enhance your presentation and keep your audience's attention. Again, reference Mr. Job's presentation above.

Tip #4: Ditch the animations.
Seriously. Step away from the animations. And don't try to sneak in any embedded video or sound effects, either. I know, I know. There's so many to pick from, and they're all so enticing, but they really distract from your message. If you absolutely must use an animation, use the fade in or fade out, but that's it. The rest are really un-sexy. I'm not joking. Leave the flashing text off your slides.

Tip #5: Remember the Boy Scouts.
Once you've reached true PowerPoint enlightenment, you quickly realize that your presentation will not stand on its own; it's now up to you. So, you've got to prepare and practice until you've got it down pat. Memorize what you need to say, know how to interact with your slides and be ready to roll with the punches.

So there you go. It's certainly not a step-by-step, but it'll get you going in the right direction. Now, no more fly-ins and fly-outs!

YFNN

Buck Your Brick Bank For Bang For Your Buck, Part Two

2007-03-02T18:50:00.000-05:00

Yesterday, I posted about one of the big benefits of some of the internet banks like ING Direct, HSBC, and Emigrant Direct: the big interest rates. At the end of the post, I mentioned that there are two more benefits that are whoppers for MLB and me. We certainly make the most of them.

My experience deals specifically with ING Direct, so I can't speak to what is available at some of the other banks.

So here are those additional big benefits:

1.) I can set up multiple sub-accounts within our Orange Savings Account, each with a different nickname and purpose. And, since they don't have a minimum balance or any other fees, I can have very small amounts or even no money at all in them without penalty. This is important to me because I can have different small savings accounts (at the great 4.5% rate), each saving toward a different goal.

2.) I can set up automatic savings plans (ASPs) for each sub-account. What this means is that I can have ING Direct pull an amount of money from my checking account at a regular interval of my choosing. For example, I can have $20.00 pulled from my checking account and put into a savings account every other Friday, if I'd like. This is vital because it's completely automatic. That means I don't have to think about it, which means that I won't ever forget to do it, which means I always stay on track. Another reason this is important is because it creates a state of artificial scarcity in my checking account. That helps me to adapt quickly to the smaller amount of money that is readily available, and I spend less. That's vital because I can't waste what I don't have.

You're probably asking, "So how do I make this work for me?"

Well, MLB and I currently have eight savings sub-accounts. Yes, Cowboy Troy, you read that right; we have eight savings sub-accounts. We have an emergency fund, several short term holding accounts, and a couple long-term savings accounts. Basically, this is the way we make it work for us: our paychecks are deposited into our checking accounts every two weeks, or twice a month. This is our main holding area. Throughout the month, money is pulled from these checking accounts into the various sub-accounts. The amount and timing of these withdrawals varies with the sub-account, typically in three different ways for us.

Savings Technique #1: We make small deposits in regular intervals for our emergency fund.
Basically, every two weeks (or whatever interval we chose), we deposit an amount from our checking accounts, thus funding our emergency fund a little each time. Since this account is for emergencies (NOT a big LCD TV), we won't draw from this account unless we absolutely need to. This is a very important account because it ensures that a short-term emergency doesn't derail us from our long-term financial plans.

Savings Technique #2: We make small deposits in regular intervals for long-term savings.
At regular intervals, we deposit an amount of money into what we call our "future kids" and "forgotten money" funds. The "Future Kids Fund" is set up for future children, since they're so stinking expensive. Things like day-care, private school, and size 4 Air Jordans, will eventually come out of this account. Note that this IS NOT a college savings account. We've got a separate 529 account for that, which is invested in the stock market. The "Forgotten Money" fund is basically for whatever we decide to spend it on. That big LCD TV or big donation to an un-named dance organization might come from this account.

Savings Technique #3: We make deposits in regular intervals for short-term holding.
Aside from the emergency fund, this is probably the most important savings tool for us. These accounts are short-term holding areas for bills and events that happen on a regular basis, but not monthly. We've currently got one for insurance, vacation, holiday gifts, and a couple others. These accounts are the reasons we're never surprised or thrown off by semi-annual or annual bills. Throughout the month, we automatically put small amounts of money into these accounts, so they grow slowly behind the scenes. Then, when a big bill is due, we pull the money out and pay it from that account. For example, we pay our insurance (auto, liability, etc.) every six months. If we expect our 6-month bill to be $600, we'd put $100 a month, or $25 a week, into the account. That way, instead of getting that big bill in December or January, and then worrying about how we're going to come up with $600 for it, the money is already there! It's a lot less painful paying $25 a week for six months than to come up with $600 all at once. Plus, the money's been earning interest for us throughout those six months.

We do the same thing with holiday gifts. We each put $10 a week into the account, and when December rolls around, we've got over $1000 ready to go for gifts. And, since it's such small amounts at a time, we don't even miss the money! It works beautifully for us.

So, how do you start? Check out bankrate.com for a huge list of high interest savings accounts. Pick one, sign up and transfer some money from your checking account. Don't forget to set up an automatic withdrawal plan so you can slowly grow your savings without much pain. And, if you want a referral for ING Direct (you get a $25 sign up bonus if you use a referral), just leave a comment with your email address, and I'd be more than happy to hook you up.

YFNN

Buck Your Brick Bank For Bang For Your Buck, Part One

2007-03-01T19:06:00.000-05:00

I'm willing to bet that the average American has a savings account at their local brick-and-mortar bank or credit union, if they have one at all. If you're one of those people with a savings account, you're on the right track, but I think you can do a lot better. The local brick-and-mortar banks around here are offering the following rates on their basic savings accounts, as of today:

If I had a $5,000 balance in their standard savings account, these are the rates I'd get:

5/3: 0.65%
Chase: 0.40%
Huntington: 0.05%
National City: 0.75%
US Bank: 0.17%

Those rates are absolutely awful. Plus, many of the accounts hit you with "maintenance fees" if you carry a balance less that a certain amount (usually $200-$500). With those dreadfully low rates and fees it's nearly impossible to get ahead!

So what's a guy with some cash to save supposed to do? Fortunately, the internet banks come to the rescue with savings accounts with many of the same benefits of a regular run-of-the-mill savings account, but with an interest rate that actually makes money! Some of the more popular ones are ING Direct, Emigrant Direct, and HSBC. These banks still have the important features, like the fact they're FDIC insured, it's easy to perform transactions, and the customer service is top notch, but they have interest rates ranging from 4.5% to 5.5%. Some even offer sign-up bonuses or even higher introductory rates!

"That's great FNN, but what does that really mean to me? Give me some illustrative numbers!"

Okay, no problem. I'll even use myself as an example.

MLB and I keep an emergency fund of cash equivalent to five to six months of living expenses in a savings account. Since we want to have easy access to the money (in case of emergency), we don't want to put the money into a brokerage account, IRA, or other investment. We want a genuine savings account. So, say we trudge on down to our bank, Huntington, and sign up for a "Premier Savings Account" with their interest rate of 0.05% and deposit our money.

At the end of a first month with our "Premier Savings Account", we've earned a whopping $0.63. That's right, sixty-three cents. At the end of a whole year, our balance is $7.50 higher than when we started. Seven dollars and fifty cents. For the whole year. Whoopity-doo.

Okay, say instead of going to our local Huntington, we decided to sign up with ING Direct (which we did) and transfer the money from our checking account. We get their standard "Orange Savings Account", and get a rate of 4.5%. At the end of the first month, we earn $56.25 in interest. Yes, you read correctly. $56.25 in one month. That's over seven times more than the Huntington account made all year! After one full year in the ING account, our balance is almost $700 higher!

"Wow, FNN, that's a lot of money!"

Darn tootin'.

"Okay, I'm interested. So what are the drawbacks?"

Well, there's a handful, but they're pretty minor. First, there is no brick-and-mortar building to go to make deposits. You have to make deposits to your regular checking account and then transfer the money to your internet account. Second, it usually takes 2-3 business days to make the transfer back and forth between the accounts and our Huntington checking accounts. However, this can be a positive. Because it takes a few days, it forces me to think a little harder about the reasoning behind the transfer. Since it's a savings account, the money should be staying in there unless I've got a really good reason.

"Are there any other benefits?"

Absolutely, and they're big ones to me and MLB. But, it's a long topic, so I'll go into more depth tomorrow. In the mean time, check out what ING Direct, HSBC, and Emigrant Direct have to offer.

YFNN

Budget Meeting 02/28/07

2007-02-28T20:38:00.000-05:00

This post is probably going to seem a little disjointed, but if there's anything that I'd like any reader to take away from it, it's the very last two sentences.

If you’re like the vast majority of the households in America, then one spouse "handles the money" and keeps the other spouse informed of what's going on. This information exchange varies from couple to couple to a wide degree, all the way from almost managing the money together to one spouse not knowing what's going on at all.

I like to think that MLB and I are right in the middle of that group. As you can probably guess, I have a pretty firm (and detailed) handle on our money, managing all aspects of our financial lives. I make sure that every penny is given a job when it comes in, and is tracked when it goes out. MLB certainly doesn't care for doing it and I'm a bit of a money-psycho, so it works well for us.

That said, MLB and I sat down and had our monthly budget meeting tonight. Basically, every month, we sit down together and go over the past month's expenditures and income, and establish the next month's budget.

I'm the biggest nerd at the homestead (okay, the only nerd), so I'm also the main finance guy, or the CFO of the household, as MLB calls it, and I prepare all the statements of expenditures and incomes. I also lay out the upcoming month's preliminary budget, based on the past month's income. We go over the preliminary budget I've created for the next month, and we discuss and make any changes that are necessary. We also discuss any issues we came across over the last month: where we’ve overspent, where we can cut back, and how we can do better. We also talk about any upcoming financial hurdles and how we're doing in working toward the financial goals we've set for the year.

It sounds really detailed and complicated, but since I already track everything, and most information is automatically generated by my spreadsheets, it's really not too bad. MLB gets thoroughly briefed in everything and has veto/approval power over absolutely every aspect of our finances, so it's completely a 50/50 agreement. By the end of the meeting, we're both very clear about where we stand, where we're going, and how we're going to get there.

I know that we're probably a bit unusual in this regard (okay, I'm unusual), but there is no doubt in my mind that our management method works, and works well. We're never surprised by a bill (more on why in the next few days), never seem to come up short, and have been able to put more and more money into investments and savings.

Now, I'll be the first to admit that MLB isn't exactly excited and enthusiastic about the meetings, mostly because she is not a numbers person and she trusts me to get things done right. Let's face it, budgeting is not sexy. But, I know that she's appreciative of the all care that is taken, and is confident that I'm managing our money well. And, I firmly believe that it is absolutely critical that she understand our situation financially. Full disclosure is the only policy.

Finally, and most importantly, maintaining and going over our budget every month gives us each financial peace of mind like you wouldn't believe. And, since more marriages dissolve over money issues than anything else, that is completely critical to our relationship.

Budgeting and sleeping well at night because of it,

YFNN

02/27/07 Market and Me

2007-02-28T17:10:00.000-05:00

Disclaimer: I'm not a stock analyst. I'm just an average guy that pays attention to this stuff and knows just enough to be a danger to himself and others.

If you follow the stock market at all, or you listen to the bobble-headed chicken littles on CNN, you probably noticed that the U.S. stock markets took a tumble yesterday. In fact, the drop was the largest single-day drop in five years, wiping out the gains for the calendar year so far and making for fabulous sound bites for the "The economy sucks! Alarm! Recession! The sky is falling!" pundits of the cable news shows.

But, what does this stock market correction mean to me, FNN, the average investor?

In the grand scheme of things, it means next to nothing. Almost zero. I'm a firm believer that the slow, sure path to investment success is to buy and hold quality stocks and especially quality index funds. If you follow this mantra, then the daily market rollercoaster, even the large swing that happened yesterday, is almost completely irrelevant. I'm in it for the long haul, so short term gains and losses mean little to me.

If anything, I look at yesterday's sell off as an opportunity. Fundamentally, I don't think anything has changed about the market, so I see this next week as a golden buying opportunity, not as an indication of a long-term slide.

Really, what YFNN thinks it comes down to is this: Nobody really knows what yesterday’s sharp drop really means. Nobody ever knows what’s going to happen with the stock market. Not even Jim Cramer. I still believe the best bet for me and 99% of the folks out there is to just relax, take a deep breath, and remember that investing in the stock market is a long-term journey.

Keep on keepin' on.

YFNN

Be Still My Calculating Heart

2007-02-27T17:51:00.000-05:00

spread•sheet (sprěd'shēt'):
n.
1. A piece of paper with rows and columns for recording data for use in comparative analysis.
2. An accounting or bookkeeping program that displays data in rows and columns on a screen.

I need to let the whole world know that I love spreadsheets. Make no mistake; I am absolutely, positively, 100% head-over-heels in love with spreadsheets. In grade school, when I learned just a few basic techniques on one of the first Microsoft Excel programs, I found that Lady Spreadsheet had her hooks in me and was never going to let go...and I never, ever wanted her to.

Now, it should be a given that I use spreadsheets every day at work. What good nerd wouldn't? But, I use spreadsheets extensively in even my daily personal life. Finances, to-do lists, Christmas card databases, inventories; spreadsheets hold them all together. I keep no less than thirty different spreadsheets I've written updated regularly. They're tracking, calculating, and listing various aspects of my life, and each one of them warms my heart in a different way. We're not talking simple ones, either. Oh, no. I've got them automatically updating, creating charts and graphs, forecasting, and monitoring countless variables and data.

I know what you're thinking: "That man has lost his #@$%! mind!" Let me try to explain:

da•ta (dā'tə, dāt'ə, dä'tə)
pl.n.
1. Factual information, especially information organized for analysis or used to reason or make decisions.
2. Numerical or other information represented in a form suitable for processing by computer.
3. Values derived from scientific experiments.
4. Plural of datum.

I'm a data man. I love data. I literally can not get enough. The more, the better. I want measurements, assessments, and quantifications until I'm drowning it. I want as much numerical information as I can get my hands on. It's the reason I walk with a pedometer. It's the reason I track household expenditures to the penny. It's the reason I count the number of steps from my office at work to the car. I crave numerical information.

With this constant stream of information constantly coming at me, I need a way to store, organize, and analyze it. That's where spreadsheets come in. As far as I'm concerned, they have no competition. They're the reason I can tell you how much my take-home pay will change if I up my 401(k) contributions by a percent (-$22.90) or how many gallons of gas I put into my motorcycle on September 24th (3.26).

I know, I know. You still may not completely understand my passion, so here in list form is why I love spreadsheets so:

1.) Automation - If I change a number on a spreadsheet, it can automatically re-run every calculation based on that change. Even if it's three hundred and forty-two formulas away, it'll do it, and do it instantly.

2.) Error elimination - I know that if I enter a formula correctly the first time, the spreadsheet will never make a silly math error, like forgetting to carry the four. It's perfect every time.

3.) Charts and graphs - There is nothing I like better than a solid, informative chart or graph. It can convey information so clearly, so concisely, and provide an understanding that no data table could ever dream of. Spreadsheets can generate them beautifully.

4.) Organization - Data is kept in nice, neat columns and rows. Everything is aligned properly. Data can be labeled and sorted with colors, fonts, or even animation. Organization will set you free!

5.) Flexibility - They can be used for simple lists, or the most complex financial statement. They're just as happy storing your Christmas card list as they are at calculating complex failure analyses. I know because I do both.

6.) Power - There's no better way to express the meaning of hundreds of thousands of data points than by using a spreadsheet to illustrate it by generating a simple graph or reduced data table.

7.) Speed - Instantaneous calculation. I'm pretty good at punching numbers with my TI-85 calculator, but I'm no match for the lightning-like quickness of Excel.

If you're afraid of spreadsheets, please don't be. They're perfectly amiable, and are eager to be your best friend.

YFNN

Nerd vs. Manly-Man, Part One

2007-02-26T17:10:00.000-05:00

MLB and I went to a wedding this past Saturday. It was a nice wedding with a nice reception, but that's not the reason for this post. While having a lovely discussion with a couple that runs in MLB's crowd, I learned of a plot of land for sale about 40 miles away from the current YFNN homestead.

In the past, MLB and I have discussed building a house in the future on a 2-5 acre plot, within 30 minutes of downtown big-city, but it's never really gone anywhere. Mostly because it's a lot of work to find a plot like that around here, we can’t buy it with cash at this particular moment in time, and neither of us are all that committed to it right now.

However, This particular plot sounds like it's a pretty solid fit for our future homestead goals. It's about two acres of grassy land seated about 20 miles outside of the downtown of our large city. It's just outside the city limits of a nearby upscale suburb, has easy access to major highways, is within the limits of city water and sewer, and in a good school district. The plot is free of structures, except for a recently built (1998 construction) two-story 1400 square-foot 4-car garage with finished second floor. We're certainly not ready to build yet, but the property seems to be listed at a very good price, and from what we've found out, the seller is motivated (divorce, etc.).

Now, re-read that last paragraph. Did you catch the "important to YFNN" part? Those that know me certainly did.

Let me be a little more descriptive regarding the "important to YFNN" part.

This structure is a two-door, 1400 square-foot 4-car garage already supplied with 100-amp electric service, city water and sewer, and equipped with heating and cooling. The lower level's got a slab concrete floor with floor drains, and is currently in use as a woodworking shop for the current owner. The second floor is fully finished with a full bath and living area.

…

Oh baby.

…

So, that leaves me in a bit of a quandary. Do MLB and I make a grab for this property even though we're not financially prepared (we can't buy it outright, but I'm pretty sure we can afford it fairly easily), and we're not ready to build a house, yet? Do we want to take on additional property taxes, even though we won't really be using the property in the next couple of years? Do we even want to consider such a impulsive decision?

To be honest, MLB and I haven't even discussed this thoroughly yet. She may be just going along with it for right now, letting me fret and calculate and analyze and estimate for a while. In her mind, this may be completely wrong for our long term plans.

I'm a firm believer in collecting data, analyzing what you collect, planning, meticulously preparing, and slowly making decisions based on sound analysis and logic. But, man oh man, do my knees ever get weak at the idea of a huge climate-controlled garage and shop with a second floor office, room for an automotive lift, and enough space between me and the neighbors to fire up a racecar or loud motorcycle in the middle of the night.

My analytical and painstakingly-detailed inner nerd is battling with my gasoline-powered, chest-thumping inner manly-man!

Help!

YFNN

Price Drops and Refunds

2007-02-25T20:43:00.000-05:00

This post is based on one of the "blog inspiration emails" I've sent to family recently.

If you buy lots of things from Amazon.com, this can be pretty valuable information.

Not many people know this, but Amazon.com has a price drop policy. They don't exactly hide it, but they certainly don't advertise it. Basically, if they lower the price on something that you’ve purchased within the past 30 days, they’ll issue a credit to your account (although you have to catch the price drop and ask for it).

If you want to check if any of your recent purchases are eligible for a refund, just follow these simple steps:

1.) Visit your account and look at all of your invoices from the past thirty days.

2.) Click on the item names to pull up the current item description and price and compare to the price that you paid.

3.) If you paid more than the current price, copy down the order number and go to the Returns and Refunds Contact Form.

4.) Select “Refund Inquiry” as your subject, and check off the orders of interest. If you don’t see the order in question listed, enter the order number in the “Other” field.

5.) State in the comments that the price dropped, and that you want to be credited for the difference. It might help to mention the item name as well as old and new price, but I’m not sure that this is necessary.

That’s it. You do have to be semi-vigilant in checking for price drops, but it's not that big of a deal.

In the past month, I've gotten refunds on a DVD player that I purchased, and the Kill-A-Watt, since they dropped the prices on both items since I purchased them. I also got back money on a pair of 19" LCD monitors. Overall, I got almost $20 back so far.

Being a nerd pays off again.

YFNN

Kill A What?

2007-02-25T18:59:00.000-05:00

This post is based on one of the "blog inspiration emails" I've sent to family recently.

Here's some proof that little changes can yield big (well, relatively big) results.

On January 15th, I replaced about 80% of the light bulbs in our house with compact fluorescent bulbs (CFLs) from Home Depot (the only CFLs that I've found that have the quality of light that we like). The remaining 20% (basement, storage, etc.) we don't use often enough to warrant the extra cost of the CFLs. Most of the bulbs I replaced were 60-watt bulbs, replaced with an equivalent 14-watt CFL. I also started shutting off both of our computers at night and when we're not home, rather than leaving them run 24/7.

Our electrical billing cycle runs from the 15th to the 15th, so I got a full month of data. In January, our electric bill was $124.65. The bill I received yesterday, with the same amount of days in the billing period, same rate per kWh, was $89.57. That's a reduction of 28%!

Now, you're probably thinking "Wow, that's pretty good, but what about the outside temperature? That will drastically affect your heating and electric." Well, we have gas heat for the house, so the furnace won't affect it hardly at all (pennies at most...solely for the blower), but, the hot tub is electrically heated. However, the February billing cycle was COLDER than the January one, so even with the increased heating of the hot tub, it should have affected it the other direction.

So, now you're probably thinking, "Great, the electrical bill is lower, but he just shelled out over $60 for some silly light bulbs!". Well, you're right. After one month, I'm in the red overall, by about $25. But, after next month, I'll be firmly in the black, and since the CFLs last about 7-10 times longer than standard bulbs, I won't be replacing them nearly so often. So, the savings will add up even more quickly.

So, just by paying a little closer attention to our computer habits, and by replacing some bulbs, we're set to save about $400 a year. That's not too shabby.

I also recently purchased a Kill-A-Watt. It's a great little device that measures the energy usage of anything you plug into it. It's a perfect tool to assess how much power that 5-bulb office lamp pulls (322 watts!) or how much it costs to run the porch light all day long. And, at only $25 or so, it's a great gift for any nerd you know. I got mine at Amazon.com.

Other interesting things I learned by taking some measurements with my Kill-A-Watt:
- Even in hibernation mode, our computers used about 220 watts. That's like running two 100-Watt light bulbs 24 hours a day.
- Our air purifiers use 61 watts in "high", but only 22 watts on "medium", with just a small drop in efficiency. No more running them on "high" at night!
- LCD monitors use A LOT less power than the big bulky CRTs (about a third, actually).

Science is fun AND profitable!

YFNN

My "Self Tax" and Initial Results

2007-02-25T18:20:00.000-05:00

This post is based on one of the "blog inspiration emails" I've sent to family recently.

I'm a big personal finance person. I enjoy shuffling money around, managing expenditures, and budgeting. I strive to make good financial decisions, plan effectively, make the best return on my money. I absolutely LOVE automatic savings and investments and forced savings. I like crazy ways to save more money. Basically, I'm a money nerd. So, I came up with my "Self Tax":

I'm forcing myself to pay a 10% "tax" on items that are unnecessary or poor choices. This not only forces me to reconsider most purchases (after all, a 10% tax is a stiff penalty...even a quick dinner at Wendy's costs an extra buck), but it forces me to put an extra amount into savings every month.

Here are my criteria for the tax. Essentially anything that is not:
- a regular bill (mortgage, cable, insurance, electric, etc.)
- groceries (since we SHOULD be eating at home as often as possible)
- a gift (we shouldn't be taxed for giving)
- charity
- healthcare/medical/prescription

is taxed.

Really, what it comes down to is that anything that is discretionary is taxed. This forces me to reconsider meals out, movie tickets, and other unnecessary or unhealthy purchases.

So, our self-tax for December came out to be $147.07. So, that money was transferred to a high-yield savings account today, where it can earn 4.5%. After $500 has accumulated in that account, the money will be transferred to a Roth IRA (the reason it's not directly placed into the Roth IRA is to limit the fees in the IRA...I pay per trade), where it can supplement our retirement. Woohoo!

So far the plan has been successful. Expenses for December were actually slightly lower than previous months, and I was able to put more money into savings, both of which are good things. I think that over the long haul, this tax will force both MLB and I to reconsider purchases and keep expenses down.

Is this necessary for us? Not at all, but MLB and I don't really deny ourselves very much. To be sure, we can live more frugally without giving up much. This seems to be an effective (and call me crazy: fun!) way to save a bit more.

Am I a total nerd? Absolutely. Am I lucky to have married a woman that will put up with this crap? Unbelievably.

YFNN

So Who Is This Guy Anyway?

2007-02-25T17:13:00.000-05:00

One of the big decisions you need to make when you start a blog is how much information and detail about yourself that you're going to divulge. I've read blogs where only the bare minimum is expressed, and I've read others where the author will tell all sorts of details about their financial, romantic, and personal life. I'm sure I'll fall somewhere in the middle. We'll just see how it goes.

To start, I'm a late-twenties guy that lives in the Midwest, that was recently married. My wife is a wonderful, tolerant woman that has more energy than anyone I've ever met, and absolutely lights up my life with her humor and spunk. We've got a good-sized house in the suburbs of a large city, and a 80-lb fun-loving, energetic dog that can make home-life interesting.

I've got a pretty normal job in a technology industry, dealing with various aspects of engineering, management, finances, and science in general.

Throughout the blog I'll refer to several different people regularly. To keep things a little more private, I'll use some acronyms. I'm sure my close family and friend know them, but the average Joe off the street won't. Here are some that I'm sure will come up:

MLB: My Lovely Bride. This is my wife. We've been married for only a few months, but have been together for a more than a couple years. I'm VERY fortunate to have a wife that is as understanding as she is.
DD: Our pet dog. We've had him since December of 2004. He's a big guy (Doberman/Lab mix) that's very playful and affectionate, and has more personality than any other dog I've met.
TCFWIW: The Company for Which I Work. I've worked there for the last couple years, quickly moving upward. I'm not going to divulge much information, but I can say that it's a technology company, and I have a position which deals with nerdy subjects like engineering, finance, and management.

I maintain the standard stable of nerdy interests like reading, computers, and especially science, but I like to think that I'm much more than your stereotypical nerd. I love to cook because of the science behind every reaction and technique and I'm very involved in every aspect of personal finance. I'm sure each of these will come up regularly.

Believe it or not, I'm involved in some other more, um, manly interests as well. I've got two motorcycles, one of which is a modern 1000cc V-twin sportbike that I ride regularly, and the other is a 30-year old 2-stroke cafe-racer that I'm in the process of restoring to new-ish condition. I've also been involved in many different aspects of auto racing, and still have a highly-modified sportscar that I used to race.

Since this blog really doesn't have much of an agenda, I'm sure posts will touch on every portion of the above at some time or another.

So that's about it. I'm sure you'll learn more as time goes on.

Later,
YFNN

What's With the Name?

2007-02-25T16:54:00.000-05:00

Well, here it is. At the request of some family members, I've started my own blog, here at http://yfnn.blogspot.com.

The reason for the name? Well, it's a bit of a Spiderman thing, where he called himself "your friendly neighborhood Spiderman". I LOVED Spiderman as small kid. And, well, I'm a nerd. It's okay; I've embraced it, and often, it pays off to be a big nerd. So, here it is, Your Friendly Neighborhood Nerd.

What the point of this blog? Well, it gives me a chance to share my nerdiness with friends and family, giving them a short glimpse into my everyday life. And, if other people stumble across this site, well, they can see the trainwreck, too.

Now, I'm not going to be one of those people that say "I'm going to write every single day!" or "I owe it to the readers to put out quality articles!". I'm really doing this for myself and no one else. It's a pretty non-committed commitment, so I'm not going to even suggest at posting frequency and especially posting quality.

So, that's it.

Yeah blog!

YFNN