Wednesday, January 30, 2008

Another rate cut?!?

Somehow it had not occurred to me that the Fed would even consider making another rate cut during the regularly scheduled meeting. After such a drastic decrease in federal funds rate just last week, it hardly seemed that further action would be desirable right away. Is this going to set off a new era of stagflation? There's so much I don't understand here.

I suppose I can expect another slightly depressing email from HSBC any day now. They'll respond to the 50 basis point drop pretty quickly. Darn it, I have no desire to borrow money. I'd like to earn interest, not pay it.


I'm rich! Ok, not really, but my scholarship checks arrived today, and I sure feel rich. This was the single biggest amount of money I've ever deposited in the bank. Some of it is earmarked for savings, and the rest has to last through the end of the semester. I've got bills to pay.

Do you remember what I said about how feeling rich is dangerous for me? Right after I went to the bank I walked to the city administrative office to pay my water bill, a trip that took me past many wonderful restaurants. Since I'd skipped lunch and eaten some none too filling junk from the vending machine instead, it took all of my willpower to avoid stopping in the bakery for a cookie and a glass of milk. Then I had to walk by my favorite restaurant on the planet and observe that today's soup happens to be absolutely fabulous. I steeled myself, paid my water bill, and walked back to my apartment, where I'm eating a pretty tasty sandwich as I type.

Tuesday, January 29, 2008

A reminder that this is only artificial scarcity

Last summer I realized that allowing myself to feel rich can be a dangerous thing. Thanks to an unexpected summer job that paid me for the work I needed to do for my thesis anyway and the interest from a mature cd, I had more money that I could envision needing any time soon. When my checking account balance was that high, it was much easier to go out to eat or to movies with friends and to buy things without worrying as much about the costs. Essentially all of my living expenses were covered by the research program and my parents, but I still managed to spend a sizable chunk of change. Over the course of ten weeks, I spent a total of $581.66. That got me another year of prepaid cell service and prescriptions when I got sick, but I also averaged around $40 a week on food I didn't really need, incidentals, and recreation.

If I had it to do over again, I probably would, but I know I can't afford to sustain that lifestyle year-round. As a result, I funneled the vast majority of my money into a cd and an HSBC account so that it stays out sight when I balance my checkbook. It's a silly psychological trick, but it helps curb my spending as well as maximize interest earned.

The goal of the system is for money that enters my savings account to remain there unless I'm moving it to another form of savings, at least until I graduate. It is starting to look like I may not be able to achieve that. During the school year, my income comes primarily from scholarships, plus tutoring last semester and a research grant this term. It's fabulous, but it also leaves me with highly irregular income.

At the beginning of the semester, I got my $1,000 stipend and submitted requisitions for living expenses including rent, food, utilities, and internet access plus requisitions for reimbursement for $594 lab equipment I bought and the $130 fee for taking the Praxis I. These are all things my scholarship should pay, and eventually it will, but my finances are getting tight in the meantime. I had to pay January's rent in late December, and it looks like I won't get my housing allowance before I mail February's rent check tomorrow. I should be getting January's portion of my research stipend soon, but the secretarial staff lost my paperwork so I have to reprint it, track down the appropriate people for signatures, and get it to the research and sponsored programs office. So I have no idea when I'll receive my next infusion of cash.

I feel stressed about not having enough money. It feels like failure to take money out of savings, but that's what savings are for, right? Covering a short-term shortfall shouldn't be a problem, and if I can just bring myself to transfer some money, I can quit worrying so much about when I'll get paid.

Sunday, January 27, 2008

Shop other people's closets

I thought I was doing pretty well. I shop clearance racks, thrift stores, and yard sales, and I rarely feel a burning need for novelty in my wardrobe. I've been wearing the same pair of black dress shoes to all formal events since seventh grade, including to senior prom when I wore them with a brand-new gown I'd purchased the preceding August for an even twenty-six dollars, including sales tax.

In other words, I pride myself on being a bargain shopper. So when I pondered the possibility of getting a snazzy new interview suit, I headed to T.J. Maxx. When I was invited to my friends' wedding, I did a mental run-through of the contents of my closet, decided I'd like something a little less matronly than the suitable choices I already own, and started checking clearance racks and browsing the online J.C. Penney outlet store.

Then I asked two of my female friends for advice on dresses. After looking at the website with me, S. piped up, "You should look in my closet first! Hey, what about my Italian silk?" It fit, and, assuming I work up the courage to show that much decolletage, I now know what I'll be wearing March 15. Her roommate, J., offered some lovely and surprisingly comfortable shoes to go with the dress.

When I talked to my mother about interview attire, she surprised me by digging a very nice grey wool suit out of the back of her closet. She'd once lent it to her best friend to wear to interview for the job she's held for the past eighteen years. I suspect it hasn't been worn since then. I'd never seen this suit before in my life, but it fits like it was made for me. Luckily for me, it's a little too snug for my mother these days so I'll probably get to keep it.

If you need clothing for a special event, check with your friends before heading to the mall. I've happily lent clothing before, and I see nothing wrong with borrowing it. Why spend money on something you will only wear for a few hours if you can get something equally nice (or in the case of the silk dress my friend bought while studying abroad, nicer) for free?

Saturday, January 26, 2008

Physics boys and personal finance

I got sucked into the field of one of the grad student offices and wasted a sizable portion of the afternoon watching youtube videos and talking about everything from E&M to This is Spinal Tap. Strangely enough, we ended up on the topic of personal finance. I would never have guessed that that particular group of guys cared about retirement savings, but we ended up discussing the relative merits of index funds verses ETF's and vigorously debating whether a guy in his early twenties with no dependents should buy whole life. One of the guys is pretty knowledgeable, one has several thousand in a couple of mutual funds that were the remnant of his college fund and is trying to learn enough about investing to figure out what to do with it, and one likes to bandy about jargon but admitted he didn't know what all the terms he used meant.

Up until now, there's been no one my age I can talk with about this stuff in real life. Discovering that I spend my days surrounded by people who also think about these things was a pleasant shock so there will probably be more chats about the difference between traditional and Roth IRA's, the advantages and disadvantages of sticking with index investing, and rants about how people our age are foolishly not saving for retirement. It's sad how blissed out I was.

Thursday, January 24, 2008

A reminder that "my" car isn't actually mine.

My Teach for America interview is February 5 so I've been busy planning my sample lesson and trying to figure out how to rank the thirty regions in order of preference. The Mississippi Delta, Eastern North Carolina, and Hawaii are tied for number one, and I have ideas for a few other places I would probably like to go and a few I'm quite certain I wouldn't. Ranking most of the regions, however, boggles my mind so I've been spending some time talking about it with people whose opinions I respect.

My parents seem to hope I'll end up getting sent to Hawaii so they'll have an excuse to visit. They've also both brought up the issue of transportation: TFA says access to a car is essential for living in most of the regions I'm considering, including Hawaii. My dad framed this as a question of whether it would be better to ship my car or sell it and buy something to use for two years. My mom said I would not be allowed to ship or sell "my" car.

She then told me that I won't be allowed to take it with me if I move "far away," not just to Hawaii. She said the 1999 Ford Taurus with 109,000 miles on it is "too good a car." My mom wants to keep it and informed me that she and my dad would help me buy something else. There is no way I would take their money under those circumstances; if I have substantial savings and a job lined up, it would feel like mooching.

My parents bought the Taurus during spring break of my senior year in high school. They concluded that I would need a car for college, which I disputed at the time, and decided they could afford to purchase one for my use since they weren't going to pay anything for college. (Not that they wouldn't have, but I got a full scholarship.) They settled on the Ford Taurus as the ideal car for a beginning driver and set a budget. I kept an eye on the classifieds and scoped out the Kelly Blue Book. After getting the car, I learned to drive, and I became fully licensed a couple of days before the fall semester of my freshman year began.

My father is very fond of the Mazda Protege he got almost a decade ago, and he recently told me he plans to keep it for another 100,000 miles. My mother got a shiny new Altima last year. They also have an older Suburban that only gets driven when they need to haul stuff but is in good mechanical condition. They bought a 2001 Taurus for my brother to drive, as well. They don't lack for automobiles, and I suspect my father's opinion on the matter of "my" car will prevail. I still have to prepare for the possibility that it won't.

My parents don't owe me a car. I was very fortunate that they provided one for me, but I'm an adult and should be able to take care of my expenses myself. I'd assumed that they wouldn't want or need my car since I'm the only one who drives it, but that seems to have been a mistake. The Taurus has been very reliable, and I hoped to get at least a couple more years of use out of it before having to decide between major repairs and a new (used) car. I planned to start making car payments to myself; based on my experience with this car, it seemed reasonable to set aside $5,000 to $6,000 for a good used car.

If I have to spend that much this summer, I can afford it, but it will be a sizable hit to my savings. In order to buy a car, fully fund a Roth as soon as I have a job, and keep an emergency fund that I'm comfortable with, I'll need to plan my spending this semester that much more carefully. I'd hit a point where it looked like I'd easily reach my savings goals and thus have a bit more money to play with for daily expenses and fun stuff, but it looks as though it is time to reassess. Rats!

Tuesday, January 22, 2008

Extra! Extra!

Is it time to start panicking yet? Since when does the Fed do emergency rate cuts? I haven't been following this for long enough, but this is the first one in my memory. Are we in the midst of a dead cat bounce, or is the cut actually working?

I'm not looking forward to the drop in the interest rate my HSBC account pays. My mother will almost certainly be dismayed by the performance of the IRA she funded just before filing her 2006 taxes. She's been talking about getting out of her fairly conservative Vanguard 2015 target date fund and into something "safer" for months. When you consider that every other penny my parents have, including my father's 401k, is in something with guaranteed principal and little growth potential, it seems a little silly to be worrying about market volatility, but they appear to have a risk tolerance of zero.

Sunday, January 20, 2008

Everything You Always Wanted to Know About The Fed *But Were Afraid to Ask

There's a great article entitled "The Education of Ben Bernanke" in today's NYTimes Magazine. If you're interested in an overview of the history of the Federal Reserve and how it works, I highly recommend it. It covers many of the topics we dealt with in my macroeconomics class last semester. The Fed is in the news almost daily now that we're facing a credit crunch and wondering how to stave off a potential recession so this is a good time to learn a bit about its workings.

Saturday, January 19, 2008

Lead us not into temptation.

I should be glad that the $280 suit on clearance for $60 was too big. Never mind that the style was timeless, the black with subtle tonal pinstripes was slimming, and the fabric draped beautifully, I do not need new clothing, not even an elegant pantsuit for interviews. I know this, but, oh, how I wish the pants to the size ten hadn't been too big or they'd had it in an eight. Shopping can be hazardous to my pocketbook.

Friday, January 18, 2008

The jig is up!

A few days ago I was at home, typing away on my parents' computer. My mom asked, "Whom are you typing to?" I told her, "No one," but she wouldn't take that as an answer. Rather than be pestered about it for the the rest of the evening, I went ahead and told her I was writing on my blog.

Big mistake. She's now determined to find my blog, and she's enlisted my brother in the search. He's been aware that I have a pf blog but doesn't know the title. Fortunately, I haven't posted enough identifying details to be easily googleable by someone who knows about my real life but not the blog, but I'm assuming that if she's determined enough, it's just a matter of time.

She correctly points out that I post this where millions of people can read it. (I'm very grateful for the dozen or so of you who do actually read Not Living on Ramen once in a while.) However, I really don't want her reading it. She's never been great at accepting that her children should be allowed privacy; I'm still disappointed by her decision to read my journal when I was in junior high. This is hardly in the same category; my blog does not contain all of my darkest secrets. Nonetheless, I really don't think that this is her business.

How do you handle these situations? Do you avoid mentioning your blog to others? Do you tell your friends and family all about it, including how to go read it? Do your family members know you blog but respect your desire to keep your blog somewhat private and anonymous? Should I give in to my mother's demands, quit blogging entirely, or just become much more diligent about clearing my browsing history?

Wednesday, January 16, 2008

What is the cost of looking professional?

I've been pondering the issue of professional attire these past few days. I could have done a phone interview in an old flannel shirt, but the final in-person interviews definitely call for something a bit spiffier. The question arises, do I dig one of my old fall backs out of my closet or start checking the sale racks for a nice new outfit? The attire teachers wear on a daily basis seems to depend a lot on the culture of the school so it is too soon to begin worrying about planning a full work wardrobe. Mapgirl and Dog Ate My Finances have both posted recently about buying clothes for their jobs, and, I must say, I'm a little nervous about the costs.

College students can get away with wearing just about anything. Physics departments are probably one of the less clothing-focused places on the planet. There are some faculty and students who do look snazzy and put-together every day, but if your hair is combed, none of your clothing is inside out, and you aren't wearing black socks with brown sandals then you probably look ok by physicist standards. (And, yes, I've seen all of those issues in our department.)

As a result, I've seen little reason to devote a lot of attention to my appearance on a daily basis. I use generic dandruff shampoo, Suave conditioner, and haven't paid for a haircut since I started college. Most days I just use moisturizer with sunscreen and lip balm, or if I'm feeling really wild and crazy, I might go for some powder and lip gloss as well. I live in jeans and t-shirts.

I do have some dressier clothing. In addition to my absolute favorite dress, a short sleeved, knee length A-line, black knit, I have a black sport coat, and two blue suits. I've had the suits for several years, and they both cost around $40 on clearance. The pantsuit was something my mother bought for me, and it's one of the least flattering items of clothing I own. I've worn it many times, but I don't plan to wear it again and probably would have donated it to charity long ago if I didn't suspect doing so would hurt my mom's feelings. The other suit consists of a sheath dress with a long coat, and I do like it a lot. It's a flattering cut, but I'm afraid the polyester fabric might scream "cheap!"

How much time, effort, and money should I devote to looking nice for the T. F. A. interview? Do I need to go get a real hair cut, or would having my mom trim my long, wavy, blonde hair suffice and putting it up for interviews suffice? Is a nicer suit worth the money, or should I stick with something I already own and am comfortable in? Will there be a little more leeway since pretty much everyone interviewing is a college student with a presumably limited wardrobe of professional attire? I'm open to any suggestions other than wearing high heels or mascara; I draw the line at things I know from experience are uncomfortable enough to be distracting.

Tuesday, January 15, 2008

Just for the the record...

Today I received an email from someone who wanted to pay me to post content on my blog. Their company would provide the text, I'd post it, and they'd pay me $25 as long as I didn't identify it as sponsored content. That sounds pretty sketchy, and, of course, I declined.

Right now, I have no desire to monetize. I've never had advertisements, but I'm not necessarily ruling out the idea. If I ever decide to place advertisements on my blog, they'll be clearly labeled as such. If I ever do a paid review, I'll let you know that as well and insist on retaining full control of my content. To do otherwise would be to compromise my ethics for money.

Sunday, January 13, 2008

Textbooks cost way too much.

Classes start tomorrow, and I bought books today to take advantage of a 10% discount at the campus book store. Purchasing the mandatory books cost $420, and I haven't bought any of the recommended supplementary books yet. Fortunately, my scholarship includes a book voucher for $500 per semester, but since the voucher is only good at the university-owned store, I can't shop around for the best prices.

Why should a single paperback text cost $140? I have serious problems with textbook publishers. Our understanding of some subjects, such as cell biology, is changing rapidly, and frequently releasing updated editions makes sense. A book on classical electrodynamics, on the other hand, should be good for many years. An introductory calculus book should be good for decades, if not centuries, once they find and correct the inevitable errors. By releasing new editions, they make used books worth very little and force students to shell out for a brand new book that may not have many changes.

I respect the importance of choosing a book with good pedagogy, but surely there are some cheaper books out there that would do the job. Is there a reason math professors never consider the textbooks available from Dover? Why do they force us to buy books with pricey bundled cd-roms we don't use? I've had one professor who told us we could search the old edition of our textbook on PubMed and thus really didn't need to buy a book at all, but most aren't so sympathetic.

At this point, shopping around helps a bit, especially if you stumble across an international edition. Try Barnes and Noble, Amazon, and ABE Books to see if they can beat the prices on campus. Also, try buying directly from former students; since the buyback prices offered by the bookstores at the end of the semester are often a joke, there might be plenty of students eager to sell. I'm lending my brother my old Diff. Eq. book and student solutions manual to save him the cost of buying his own. If your college library keeps books on reserve and you can get them when you need to study, that can be a good way to reduce your costs, but it isn't always an option. Sharing a book with a friend, especially a roommate, can be handy if you can work out a schedule so you aren't fighting over it the weekend before a major exam. Project Gutenberg can sometimes give you access to books you need to read for literature classes. I wouldn't recommend forgoing a required text in an attempt to save money even though I know people who've done so. Doing the required reading makes lectures much more comprehensible and keeps you actively engaged in the course.

Saturday, January 12, 2008

An utterly impractical thought...

I am not going to buy a house right now. I don't even want to. It's not really affordable when you factor in repairs, scholarship rules explicitly forbid it, and my goals involve moving in the near future. Still, I page through the real estate ads and wonder what I'll be able to afford when I do buy. It can't hurt to consider what income would be necessary for the lifestyle to which I aspire.

I looked up the price of a house down the street from my parents. It's a tiny two bedroom one bath with only 728 square feet of living space, and it isn't a fabulous place despite a decent sized lot. It wouldn't be suitable for a big family, but it could be great for a single person and a dog or two. The list price is $75,000. My parents think that's ridiculously high, and they may well be right. However, if I drained almost all of my savings, I could make a 20% down payment. Even with a 7% interest rate, the payments on a thirty year mortgage would be slightly less than I pay in rent right now. Barring another real estate boom in the next few years, buying a home in my area on a single teacher's salary a few years from now seems pretty feasible. That may not be what I decide to do with my life, but it's nifty to know that I could.

Another Saturday night and I ain't got nobody

It's another exciting evening in. A friend is hosting a poker game tonight, and I'm sure it could be great fun, but I'm feeling tired. I'm both introverted and shy so being around big groups is somewhat draining; it isn't that I don't like socializing, but when I'm already feeling a bit down the impulse is to find someplace quiet to hide. On the plus side, hanging out in my apartment is cheap, and thanks to the Britcoms on the local PBS station that my antenna picks up, books from the library, Pandora Radio, and a movie my brother lent me, I can't complain about being bored. I wouldn't want to spend every weekend like this, but it is good for staying within budget.

Thursday, January 10, 2008

Teach for America Update

I spent much of the morning compulsively checking my status on the T.F.A. website even though it clearly stated that the information would likely appear after 3 p.m. Eastern Time. I pried myself away from the computer and went to visit my grandparents. Then this afternoon I got the official email.

They don't want me to do a phone interview. I get to skip that step and advance directly to the final in-person interviews! I don't know how or why they made this decision, but I'm pretty excited. Although I feel bad about wasting the assistant dean's time helping me learn techniques for telephone interviews, it is fantastic that there is one fewer step in which to mess things up.

Isn't it interesting that T. F. A. has such cachet that I'm competing against Ivy Leaguers for a job that might pay $25,000 a year? Whether I get in or not, I am going to teach for at least a couple of years, and I'd like to think I'm driven to do this by altruism rather than by external factors. This is what I feel inspired and passionate about doing. However, I must admit that if I'm going to be doing this sort of work either way, I wouldn't mind getting the resume boost as well.

There are many steps I need to take between now and the interview, which will be sometime February 5th through 7th. I'm going to try to break things down into manageable daily goals so I get everything accomplished, make progress on getting data for my thesis, and remain calm. Right now, I'm going to review carefully the articles they asked me to read for the interview and begin researching placement regions.

Teach for America will want to know my placement preferences by February 1st. My top choices at the moment are Hawaii, Eastern North Carolina, and the Mississippi Delta. I do think I'm leaning toward more rural regions, but I haven't been enough places to feel certain. If any of you lovely readers who live in regions where T. F. A. volunteers work would like to make suggestions, I'd be most appreciative.

Wednesday, January 9, 2008

It's time to quit panicking.

I'm a college senior with a positive net worth and good job prospects. I could live for at least several months on my savings. Somehow, that isn't enough to assuage my worries. I feel guilty about having spent $10 on a new shirt, and I wonder whether I would be able to pay for long term care insurance for my parents on a grad student stipend. I've started running the numbers on my budget and savings a wee bit too obsessively.

It's entirely possible to devote this much time and effort to money and be psychologically fine, a little quirky by the standards of modern America, but fine. If you're trying to get out of debt, buy a house, save for retirement, or pay cash for a stereo system that could wake the dead, focusing time and effort on finances makes perfect sense. If, however, you are motivated instead by free floating anxiety, then something may be wrong.

I've seen myself fall into this pattern before. In junior high, I was slender but counted calories compulsively. I carefully measured my cereal each morning, and I knew exactly how many calories I was getting from the tablespoon of peanut butter on raisin bread and an apple I allowed myself for lunch. I had very irregular periods, and I regarded menstruation as I sign I had let myself get too fat. My self worth was linked to the number I saw on the scale each morning.

When life gets scary and overwhelming, I tend to focus on one area of concern. Things seem much more manageable if I pick one thing, preferably something that can be quantified, and work as hard as I can on that. I know that it makes no logical sense, but I convince myself that if I can just lose two more pounds or save two hundred more dollars this semester, then I'll be able to cope with everything else. It doesn't work that way, and ever-shifting but pointless goals only add to my anxiety.

I'm aware it is a problem, but I don't know how to fix this.

Monday, January 7, 2008

Big Spending

Today I spent a lot of money. When you buy many items, you have to decide whether the basic model meets your needs or you want extra bells and whistles. In most cases, add-ons aren't really worth it, but sometimes you find that the money you could save doesn't compensate for the frustrations of using something that doesn't quite do everything you wanted.

I got glasses the summer I turned eight. My vision has finally stabilized, but my myopia and astigmatism are pretty severe. When you go to price glasses, clerks ask to see your prescription so they can tell you what the lenses will cost. Often, the response after they look at it is, "Oh. Oh, wow." I can't function without my glasses, and I wear them pretty much every waking minute.

I'm willing to spend more to get glasses I like. Shatter resistant polycarbonate lenses and Transitions lenses that get dark in sunlight are a priority for me. I tried going back to ordinary lenses, and I spent a year wishing I hadn't. The less expensive lenses were a daily annoyance, and I resolved to stick with the pricier but superior option. Is this lifestyle inflation? Sure. Does that bother me? Nope. When I consider the cost per wearing, getting the glasses I want is the only sensible choice.

I've been wearing my current glasses for two and a half years, probably for an average of sixteen hours a day. Since my vision is no longer changing much at all, I'll almost certainly keep the new pair for at least two years. Getting polycarbonate and Transitions instead of basic plastic added $110 to the costs. I'll gladly spend an extra fifteen cents a day.

Sunday, January 6, 2008

Is it time to move my savings?

Opening a high yield savings account was one of my better financial decisions. At first, I was able to keep savings liquid yet earn interest rates comparable to those local banks offered for certificates of deposit. When the interest rates began tanking in response to the Fed's rate cuts, I moved just under two thirds of my savings into a seven month cd. Now that rates have dropped further, I'm debating how much of a rate chaser I want to become.

I like HSBC. Their phone support when I managed to lock myself out of my account was superb, and I appreciate being able to withdraw money from an ATM even though I'll probably never do so. I'm tempted to stick with them simply because doing so requires no effort.

There are better rates out there right now, but I've done the math and am not sure it's worth moving my liquid savings around to make an extra $25 a year. Does that make me a lazy and irresponsible slacker? Maintaining eighteen different bank accounts and trying to make sure I eke out every possible penny of interest doesn't sound like an enjoyable or efficient use of my time. I'll probably move a little more money into certificates to lock in rates, but I want to minimize hassles. There are enough in life already.

If only it were Thursday already...

I submitted my Teach for America application on Friday. I had to send it in by 1:59 am Saturday, and I thought that continuing to revise my essays during a break from working in the biochem lab on Friday afternoon would be a-ok. I was in my apartment, typing along and feeling pretty good about my work. Then, of course, the power went out. Panic ensued.

Fortunately, the outage was confined to an area of a few blocks, and I was able to continue working in the university's computer lab. My brother was kind enough to read over my essays before I sent them in, and he even let me eat the leftovers from his lunch while I sat around in his apartment waiting for him to finish proofreading. He suggested I eliminate one extraneous comma, and then I reread everything three times. I concluded that my essays, while mediocre, weren't going to get any better, and I sent them in before anything else could go wrong.

They must be pretty efficient at plowing through these applications; they'll be able to state by Thursday who makes it to the telephone interview stage. I'd like to know if they're going to reject me so I can devote my energies to my other plans. I don't feel tremendously optimistic, but I'm trying to remain unconcerned. I put forth a good effort, and now I have to let go and accept that the results are no longer in my hands. I think pulling that off is going to require long walks and yoga dvds, but I'll do my best.

Saturday, January 5, 2008

In August a few of us were hanging out at my friend's apartment after the departmental picnic. We'd been watching silly game shows, playing cards, and catching up after a summer apart. Someone suggested we go get ice cream, but my friend decided not to go along. He told us he couldn't afford it. He was also sleeping on a thin foam pad on his floor because, he said, a mattress was too expensive. At first, I was baffled; he has the same scholarship that I do and had had a reasonably lucrative summer job. What was going on in his life that left him without $1.39 for an ice cream cone? I lent him an air mattress that I'd bought on clearance the year before and decided not to ask questions since his finances really weren't any of my business. Things became clearer when he bought a pricey ticket to fly out to see his girlfriend.

I admire his determination to spend money only on the things that enhance his life the most. People frequently assume that college students are broke, and that makes it easier to get in the habit of frugality. There is great value in being able to say, "I can't afford that," aloud. We prefer not to face the cold, hard reality that our resources are finite, and the availability of easy credit makes it possible to live as though they aren't, at least for a time. It's much more socially acceptable to spend money you don't have than to opt out of events that don't fit your budget, but being able to prioritize will serve you better in the long run.

Wednesday, January 2, 2008

One of those things you should do semi-regularly

If you are in the U.S., there's really no excuse not to check your credit report for errors now that you can get a report from each of the three major credit reporting agencies once every twelve months for free. So why haven't I done so already? Chalk one up for inertia. My credit report hasn't played a noticeable role in my life so far. Most of my friends had to get their credit scores checked and/or have their parents co-sign their leases due to their lack of credit histories. My landlord had a one page lease written in plain English that included a promise that I didn't owe a previous landlord money. That was it: no credit check, no background check, just one signature and a handshake.

It's time to overcome that inertia and check my credit history. I'd hate to find out ten years from now while trying to buy a house that some creep defaulted on a boat loan in my name in 2006. It'd be much better to catch any errors while I still have plenty of time to fix them. So off to I go.

Getting into the habit of doing this regularly is a great idea. I think I'm going to follow the advice of my ex-boyfriend's dad and check Transunion now, Experian in four months, and Equifax four months after that. He thinks you might be more likely to catch any problems quickly that way, and it makes some sense.

The only problem with checking my credit report is that I'm tempted to shell out the extra fifteen bucks to get a credit score as well. That's probably a sign that I've read too much Suze Orman. I don't need credit right now, and I know that even though I don't have a lengthy credit history, I should have a decent score for insurance and other miscellaneous purposes thanks to my stellar payment history and low utilization ratio. There's really not much to gain by spending the money to satisfy my curiosity.

Tuesday, January 1, 2008

Zero cost New Year's Eve

It was a tremendously exciting evening of hanging out with my parents and then spending a few hours catching up with an old friend via instant messenger. He's good company even when he's hundreds of miles away, but it also served as a stark reminder of how alone I am right now. I'm very eager for my friends to return from their Christmas vacations. Happy New Year, everyone!