Setting goals for 2008

I've been working on my goals for the first half of 2008. In the next couple of months, I should know a lot more about what the second half will hold, but right now I can't do much planning beyond graduation on May 10. Naturally, I have lots of goals related to getting applications completed, getting data for my thesis, writing said thesis, taking the PRAXIS, and so forth. These are all pretty much mandatory activities, so they hardly qualify as resolutions. You'll probably hear more about those in the next few weeks and months, well, unless I bore you so badly with minutia from my mundane life that you quit reading. At New Years, the idea is to focus on goals you might otherwise not feel quite so compelled to fulfill.

My financial goal is to have $17,500 set aside in savings separate from my account for normal living expenses when I graduate. I revised this upward from $17,000 since I got the research grant. This should be easily achieved by funneling my stipend money and a fraction of my pay from the grant into online savings as soon as I get the money so I won't let it slip through my fingers for day-to-day expenses. I might move a bit more into certificates of deposit or bonds to chase better rates, but I want to have a sizable chunk of money totally liquid in May in case I have to spend money moving across the country and setting up a household in a new place.

In a cost-free non-financial goal, I resolve to get more exercise. I'm not trying to lose weight since at 5' 6" and somewhere between 130 and 135 pounds on any given day, I'm reasonably happy with my body. I'm not in fabulous shape, but I don't want to run marathons or anything like that. Long walks or bike rides are two of the best stress relieving techniques I know, but when I get busy and anxious, I tend to convince myself that I don't have time. That needs to change if I'm going to get through the semester with any shred of sanity intact.

In a slightly more spendy non-financial goal, I resolve to improve my emergency preparedness. I go through phases when I fret about that sort of thing, but I've never taken a thorough, systematic approach. The approaching tornado season should be a much stronger motivating factor than having watched I Am Legend, but I figure being prepared is a good thing even if my reasons are silly. Step one is determining what I need to do to be ready for the natural disasters my area experiences. I've completed first responder training, but I've let my cpr certification lapse and haven't done much reviewing lately. I have an amateur radio license I earned a few years ago and a cast-off radio a teacher gave me when he bought a new one, but I've never tried to make contact and don't keep the radio's battery charged. I need to read back through my books to make sure I'm up on the pertinent regulations and then get comfortable using the thing. I keep a few liters of water and some non-perishable food on hand at my apartment, but I need to take inventory and figure out what else I ought to buy. In addition to supplies, it would probably be wise to keep more cash on hand, in the hopes that in a short lived, minor emergency paper money will retain value.

Is it odd that two of my three main goals are motivated by uncertainty about the future? At what point to you just accept that you can't be prepared for every possible event and just do what you can and then quit worrying about it? Any suggestions for what I should do differently? What are your goals for 2008?

Will Your Money or Your Life change my life?

Your Money or Your Life is frequently touted as a life-changing book. Trent at The Simple Dollar frequently raves about the impact it had on his mindset and relationship with money. Since I was at the library and in the mood for some relaxing fluff, I thought I'd give it a try. I was somewhat skeptical; there are a lot of personal finance books that promise bold new solutions but actually just repackage the same stale ideas for the eighteenth time.

Overall, I was pleasantly surprised. It wasn't revelatory, but that's probably because I went through a phase during my early teens when I read a lot of Mother Earth News and daydreamed about saving up a bit of money, building a cabin, and dropping out of the workforce to farm and write. Since then, I've realized that I kill plants far too readily to ever farm successfully and that that dream was probably based in part on social anxiety and the desire to avoid having to interact with others in daily life. Nonetheless, the idea of working for a finite period of time as means to an end wasn't new to me. Neither was what I see as their key point, that having more stuff doesn't lead to more happiness and living beneath your means can be satisfying.

Mr. Dominguez and Ms. Robin are certain that if we follow their nine steps, we'll all step off the hedonic treadmill, put enough money into government bonds to live on the interest, and then devote our time to working for world peace, organic farming, caring for the elderly, or other such noble endeavors. It's a refreshingly different take on personal finance, which is often described as means of getting more money without any pause to consider why we want the money in the first place. Your Money or Your Life is, at its core, about leading an examined, purposeful, and fulfilling life. The accumulation of money is treated as a means to an end. The authors contend that, although the Industrial Revolution improved lives by raising standard of living, the materialism and careerism that accompanied it are slowly poisoning our culture and our planet. How many personal finance books sport a blurb from Ralph Nader on the cover?

I didn't find the hippie propensities of the authors off putting or too preachy, but some might. I felt that they repeated that "you must complete all nine steps" about one time too many. The anecdotes about folks who followed their program with great success were sometimes a little too pat. I don't fully buy into their dismissal of inflation, especially when it comes to health care costs, or their insistence on investing solely in bonds.

Making a wall chart and calculating the crossover point when my investment income will exceed my living expenses might be an interesting exercise, but I'm a bit less enthused about their suggestion that I include time spent on decompression, escape entertainment, and vacations when calculating my real hourly wage. I'm fairly certain I won't follow their nine steps to financial independence.

If you are looking for a guide to investing, this book isn't for you. If, like me, you're trying to sort out your goals and values in life, Your Money or Your Life raises some valuable questions. It was a good read for an introspective sort of day.

Overwhelmed

I know that I should be diligently working on something, whether it's research, my TFA application, or just cleaning my room, but I'm doing none of those things. Instead, I'm sitting in the lab getting nothing accomplished. The tasks I have to accomplish in the next few days, weeks, and months seem tremendously daunting, and I'm stressed out.

My grandfather is doing much better. Eight years ago he recovered from a bad bought of pneumonia, but he's had to be on oxygen ever since. He's been getting gradually weaker, bouncing back surprisingly well from each illness and surgery, all things considered, but always ending up in somewhat worse shape. We've reached the point when the purpose of medical care is to make his life more comfortable rather than to try to prolong it, and that bothers me. He didn't have to go to the hospital since antibiotics have proven yet again to be a wonder drug for treating bacterial infections, and he's breathing much more easily and seems more comfortable. It looks like he's recovering; on Christmas, we weren't sure that would happen this time. I don't think my grandmother will take it well when he does pass away, and the whole thing is likely to be very hard on my mom as well. I'm worried.

Right now, I'm also supposed to have a plan for my life. As if today, I need to take E&M, physics senior seminar, write and defend a thesis, and I'm done with my degree. (I've signed up for other classes as well, but only because I never resist the temptation to sign up for more science and math classes. I already have more than enough hours to graduate.) After long talks with my adviser, I have a plan, at least in theory. I'm going to go teach for a couple of years, and then if I still want to go to graduate school, I'll apply. By spending some time living like a monk in the world and doing pretty much nothing besides teaching and studying, I might be a little stronger and better prepared when I get to graduate school.

This all sounds good, so why am I freaking out? Writing application essays is forcing me to articulate why I want to teach, and I'm having a hard time with that. Good secondary science and math instruction is important, I like teaching, and I think I could eventually become a good teacher. Teaching a lab was one of the most difficult things I've done in my life, but it was also one of the most rewarding. Still, I'm not certain I have what it takes, and right now my primary goal is to convince others that I can do this even though I have doubts myself.

I definitely don't have adulthood figured out yet.

There's nothing I can do until morning.

There's nothing I can do until morning, and there's nothing I can do then that wouldn't be handled much more competently by someone else. It would be best to go sleep and then arise ready to face the challenges of the day, but instead I sit here worrying. My grandfather is ill.

Yesterday when my grandmother and I went to visit him, he was coughing. My grandmother spoke with the nurses about it, and they assured her that they'd keep an eye on him. Today the cough was worse, a wet gurgling sort of cough that strikes fear in my heart. My grandmother, a former nurse, brought her stethoscope and concluded that his lungs don't sound good. He didn't have a fever, however, and the nursing home staff said that he has an upper respiratory infection. They called a doctor who prescribed antibiotics, but they then discovered that they didn't have the prescribed dosage. Since it was Christmas, the pharmacy was closed. They told us they'd put in a call to find out whether they could give him one higher dose tonight or split a pill.

Tomorrow they'll decide whether he goes to see a doctor. I'm fairly certain we'll request he see one unless he's doing dramatically better in the morning. Then, there's a wait to see whether the nursing home doctor approves the request by phone. If he does, then they transport my frail 88 year old grandfather to the emergency room. It isn't possible to see a doctor at a nursing home if you're sick. The doctor sees each patient once every sixty days, and that's it. It seems like an utterly stupid system, and what exactly happens to patients who don't have family around to watch out for them? What happens if my grandfather isn't well but they refuse to let him see a doctor? Medicaid is still new to us so I don't know how everything works.

My parents will be the ones who handle all of this. My father is off until New Year's. So Dad gets to head into town in the morning to check on my grandfather and sort out what should be done and how. Even though I'm sure my parents can manage without me, I still want to go in in the morning and visit my grandfather. If there are things to be done, I can miss a day of working in the lab. Everyone else is away visiting family for Christmas, and I'd hoped to spend a few days getting data uninterrupted in a quiet lab and working on my Teach for America application. Right now, that can all wait.

Merry Christmas!

Merry Christmas, and warmest wishes to everyone, whatever your faith. I hope that your days are filled with the pleasures of good company, good food, and cherished traditions.

A baffling governmental decision.

Michelle Singletary recently wrote about the Treasury Department's decision to lower the amount of money an individual may invest in U.S. Savings Bonds in a year. So far, Treasury Direct doesn't make mention of this change, and I have no clue why the government would do such a thing. Do they really want the U.S. to go deeper into debt to the Chinese instead of our own citizens? You'd think that the government would want to encourage savings.

Perhaps it has something to do with fears of a contraction of the money supply in the wake of the credit crunch. That's the only explanation that comes to my mind, anyway. The official news release states that the purpose is "to refocus the savings bond program on its original purpose of making these nonmarketable Treasury securities available to individuals with relatively small sums to invest." Savings Bonds have always been very accessible to people with small amounts of money. You can buy an EE Bond for $25, and a paper I Bond for $50 or an electronic I Bond for $25. I don't see what allowing people with more money to invest more harms.

I suppose this will have little impact on the lives of 99% of the U.S. population. I Bonds seem like a reasonable choice for risk avoidance over the long term, but most people wouldn't buy $30,000 or 60,000 worth in a calendar year. Personally, I have just one $50 I Bond that I bought during my freshman year of college.

I plan to put a bit more into I Bonds when I turn 24. Thanks to the Education Tax Exclusion, they aren't a bad way to put a bit of money aside for college. Since I don't have any student loan debt of my own, I should be able to start saving a little for the education of potential children without negatively impacting retirement savings. I don't want to set up a 529 plan because I don't have kids yet, and I'm not sure I will. (I like children very much, but having them would probably require being in a serious relationship again at some point. I'm not so optimistic about that right now.) If I don't have kids or have kids who don't go to college, money in savings bonds can be put to some other purpose with no penalties. A few thousand dollars in inflation protected bonds would also serve as a great emergency fund once you've held the bonds for five years.

Sick.

I had lots of plans for today. I wanted to give blood, but I woke up with a sore throat and a cough. It feels like it is extremely hot in the lab, but the thermometer says otherwise. The graduate student is gone for the day so I could take off my sweater and continue working in my undershirt, but that might seem weird if anyone walked in. Lying down sounds extremely good right now anyway so I think I'll call it a day and accept that there will be more tedious, mindless grunt work to do tomorrow.

I've worked while sicker. I spent about a week coughing for hours on end last summer while everyone else in the lab kept asking if I was ok. In retrospect, it would have made sense to go to the doctor sooner rather than hoping it'd go away on its own. One of the major advantages of being a student is being able to go to the health center with no marginal cost since we've already paid the fees. Thanks to a kindly nurse practitioner and $20 worth of medication I soon felt better. I was grateful for this small scale socialized medical system.

It doesn't always work well. Appointments during the height of flu season can be hard to come by, and mental health care focuses on drug therapy since there aren't enough doctors and psych grad students to keep up with the demand for counseling. For most routine issues, the system does work well. I need to go ahead and schedule my annual check-up for early January.

It was a good day in lab.

Nothing leaked or exploded.

Material rewards

My brother informed me that if he made a B in Honors Calculus III he was going to buy Super Mario Galaxy for his Wii. He made the B, but then he made B's in two other classes as well. He's not sure whether he's going to get the game since he no longer feels he deserves a reward.

I've toyed with the idea of buying myself something moderately priced and coveted as a reward for a semester well-spent. There were a few very painful months, and I did my best to take my advisor's suggestion of throwing myself into school to soothe heartache. It didn't really help, but it was still good advice. I worked hard even when I felt lousy, and that will do me good in the long run. In the short run, it'd be nice to have some more tangible payoff.

Thanks to the research grant, I've got a sizable amount of money coming in in a month. I'm tempted to set aside some amount, say 1% of the extra pay from the grant, to blow on silly, impractical, meaningless, fun stuff. Some of the rest will go to provide a bit of extra wiggle room in my monthly budget since I probably won't be tutoring next semester, and there'd still be a sizable chunk left for savings. There really isn't a pressing financial reason not to blow a bit of money.

On the other hand, it feels decadent. Isn't hard work supposed to be its own reward? Shouldn't I take more satisfaction in my accomplishments than in having stuff? It sets a bad precedent to allow myself to use the, "You work hard and deserve nice things," line of reasoning.

Christmas shopping complete and under budget

After much hunting and debating, I finally settled on a gift for my brother. He's been complaining about the cheap kitchen knives he has, although I'm not sure why since he rarely cooks. He may not like the nifty new set I picked up at the warehouse club today, but he generally complains about the gifts I give him so I'm not going to worry too much about it. My dad will be getting the second season of The Rockford Files on dvd. By this point he's watched the reruns on tv enough that he pretty much has many of the episodes memorized, which drives my mother slightly crazy, but I have no problem with feeding his obsessive devotion. I got some wonderful, oh so soft, cozy, pima cotton flannel pajamas for my mother; I'm pretty sure she'd never have been willing to pay what I did for them, but if I can conceal their cost, she'll probably enjoy them. I've already set aside a few small things from the after Christmas sales last year to give to my friends so the grand total for gift spending this Christmas came in slightly under my $100 budget.

Your tax dollars at work...

When I arrived home last night, I discovered that I'd received a letter from the state's Department of Higher Education. They've decided to fund my grant proposal. It'll mean $625 from the state and $625 from my university with which to pay myself for my work next semester, $1,000 for supplies, and $250 towards travel to a conference. I suppose that I really ought to be thrilled, but I'm feeling a bit ambivalent.

I've been the recipient of taxpayer's largess time and again. My family has never been on any form of welfare, but I may have gotten more money from the government these past few years than some people who are. In addition to whatever the state provides to my public university, they've given me $40,000 for school. My state decided to solve its brain drain problem by offering huge scholarships to students with top test scores, and for the past three years that scholarship covered most of my college costs. This year I've deferred it and am spending money from a different fellowship so I can use the state scholarship to pay most of my tuition for a masters in teaching if I decide to go that route.

If you're wondering what your federal income tax pays for, it may well have gone toward paying me to shoot proteins with a laser last summer. (Ok, so the research is a wee bit more complicated than that, but I doubt any of you want to read the details.) It's great that our country continues to fund basic research, but I feel weird about being the person getting funds.

I like my work, but I don't think it's going to change the world. At best, I'm hoping I might get to be co-author on a paper if we ever get to the point where we have anything publishable. To be perfectly candid, the money for supplies is fantastic, but I've got to get to work and try to get enough data to write a solid honors thesis and would be doing the research whether I get paid or not. It doesn't seem like my research is meaningful enough to get funding. Maybe it's a case of the Impostor Syndrome?

Envy.

If you read personal finance blogs on a regular basis, you'll discover that there are a lot of people in the U.S. who're struggling to get out of debt. A few of these people found themselves in dire straits due to circumstances beyond their control, but it seems that many more simply lived beyond their means for a few years. Bloggers post about their travails and successes as they strive to pay off enormous consumer debts, and there's generally a good deal of celebration and congratulations when someone accomplishes his or her goals.

That's great, and I'm glad the internet has enabled folks to find a supportive and informative community of like minded people. These victories should be applauded. At the same time, I'm a little envious.

It isn't that I envy people the stresses, sacrifices, and hard work it takes to dig out from a mountain of debt, nor do I envy them the goods they bought in spending binges before they saw the light and started spending less than they earn. As crazy as it may sound, I'm a bit jealous of the sense of irresponsibility that enabled them to get into these messes in the first place. I envy their ability to be young and stupid and spend a portion of their lives following their whims without fretting much about the consequences.

By nature, I'm a worrier. I panic and over prepare for a lot of things in my life. I started planning for college admissions and scholarship applications as a tenth grader. I study too much for even the easy classes. I wonder whether, five or ten years from now, I ought to offer to buy long term care insurance for my parents. I save diligently, clip coupons, and try not to be seduced by the culture of consumerism. This mode of living pays off in many ways, but, frankly, it isn't much fun.

Thoughts about what life will be like when I finish my undergraduate degree and find a real job have been flitting through my head a lot lately. I thought about how fun and exciting it would be to be able to budget $100 a month for purely discretionary spending, for movie tickets, new clothes, books, music, and dinners out. Then it occurred to me, if I'd really wanted to do that, I could have done so this semester and still spent less than I brought in. There's a whole $1000 a semester that makes its way into savings before I have a chance to do anything else with it. It's the prudent thing to do, and I'm a prudent person.

It would be nice, just for a while, to be someone else. To be a little more impulsive and a little less goal oriented. To choose short term happiness over a long term goal without guilt. To live without worrying all the time. To be able to make a decision without trying to weigh the marginal costs and benefits. To throw caution to the wind.

More, brief, pointless, random posting.

This has nothing to do with personal finance; I just desperately need a break after submitting my last big paper of the semester. I'd love to nap, watch some tv, eat a nice meal, and celebrate getting an A in quantum, but I know that instead I should study for the cell physiology test. Do you think it's possible to listen to thirteen 50 minute lectures in the sixteen and a half hours before the test without going utterly insane? I'll probably listen to at least some of them, but I think there's going to have to be some time for sleep as well. I'm going to have to trust that my studying throughout the semester will be enough even if I can't muster much effort tonight.

Free hot chocolate makes me happy.

I love the honors lounge at my university. In addition to offering a great place to study, read, or sleep, there are lovely teas, soda, and occasionally cookies or other goodies. If hot chocolate is appropriate treatment for Dementor attacks, it's clearly also an appropriate post-QM final beverage of choice. If only I had time to curl up with The New Yorker in one of the cushy recliners instead of hurrying off to work on a paper.

Finals

Tomorrow's dead day. I have about 18,000 things I need to accomplish between now and next Monday. Post frequency may be way down for the next few days. On the plus side, spending will also go down since the only thing I can imagine buying in the next week is a package of Oreos. Oreos, a big glass of milk, and quantum studying seem to go well together; I'll go back to trying to eat sensibly after the final.

$709.86

I have $709.86 in consumer debt, and it has me a little worried. About $600 of that is for school stuff for which I'll get reimbursed; I really ought to go submit my receipts tomorrow. The rest seems high, but it's really normal, planned spending. If I'm going to have to use a stamp to mail in a payment either way, I might as well charge things rather than write a check so I can get some minuscule fraction of a percent back. The spending all gets recorded in PearBudget and impacts my planning the same way regardless of whether I use cash, check, or credit. Still, even though I knew that I had charged around seven hundred dollars worth of stuff, seeing that number freaks me out a bit. Even though I know that these were all budgeted expenses, having that much debt makes me feel like I'm teetering on the brink of ruin.

Savings Goals for 2008

Patrick at Cash Money Life is going to give away an iPod to one lucky person who posts his or her financial goals for 2008 using a SMART format. (He explains what that is and how to do it.) Setting financial goals has been difficult for me, but if I don't have some aim in mind, it will be too easy to let my motivation lag.

My goal is to have $17,000 in savings set aside by graduation in May. I will set aside the$1,000 stipend I'll receive in January. I'll need to save approximately $30 a month as well and continue the compounding of interest on my current savings account and cd. This seems pretty achievable. It'll be a lot easier to meet this goal if I get the research grant I applied for as well; getting an extra $1,250 with which to pay myself would leave me with more money than I know what to do with.

I shouldn't count my chickens before they hatch, so I'm not including grant money in my projections. If I get the money, I should revise my target upward, but probably not by $1,250. Saving is well and good, but setting aside a bit of money for fun will keep me from coming to resent my budget.

The most difficult part of reaching this goal is to avoid frivolous spending that would force me to dip into my stipend or existing savings. By keeping my savings in an online account and a cd that doesn't mature until May, my money is less accessible and the temptation to spend it is minimized. There's also a possibility that I'll have to travel so there may be some additional expenses next semester. If I am unable to meet my savings goals because I have to pay for a plane ticket to go interview for my dream job, that's a perfectly acceptable trade off. Finding a way to pay for things like that without going over budget would be better, though.

I take great pleasure in knowing that I have enough in savings to live on for a year if I had to. If I begin work after completing my undergraduate degree, I'll be able to fund fully a Roth immediately and still keep a sizable emergency fund. If I pursue a master's degree instead, I'll be able to avoid student loans even if I don't get additional scholarships. Having assets instead of debts gives me a lot more freedom.

If anyone mentions "the latte factor," I'm going to lose my mind.

When I was growing up, no one drank lattes except on tv. My dad is a caffeine addict with a fondness for espresso, but he never bought them at coffee shops. He brewed them himself in a little espresso pot on the stove using beans bought at a warehouse club. Later, my aunt bought him an espresso machine for his birthday. My brother and I thought it was very exciting at the time, and my dad steamed some milk for us when he first got it. Neither of us ever developed a taste for coffee.

We first got a Barnes and Noble in my area when I was in junior high, and with it came an attached Starbucks. My dad and I used to go there on Saturdays for an hour or two between martial arts classes. He'd drink an ordinary coffee, I might have milk, and sometimes we'd have cheesecake. It was nice. We'd sit and talk before drifting off to go find things to read, and he treated me like an adult, perhaps not as an equal, but as a reasonable person deserving of respect and interest. Those conversations over cheesecake mean a lot to me.

Nonetheless, coffee shop culture never became a part of my daily life. It was a special occasion, a treat. When I first heard the term "latte factor" I was incredulous. Do you mean to tell me there are ordinary middle class people who buy fancy, overpriced coffees every day? Since starting college, I've discovered that this is indeed a reality.

Many writers of personal finance articles and blogs seem to be laboring under the delusion that everyone does this. They preach that by brewing my own coffee, buying my soda in bulk or quitting entirely, and by not buying bottled water I can save hundreds, if not thousands of dollars a year. I'm sure that advice helps some people and gets them thinking about their spending. For me, it's useless. I don't drink coffee, have around two sodas a month (generally when someone else provides them), and have purchased bottled water perhaps four times in my entire life.

So while those articles are suggesting I can save huge sums of money by getting rid of habits I was never in in the first place, others are reminding my that every single penny I spend in my entire life could have been put to some better purpose. After all, there's no area of spending that couldn't somehow be cut, freeing up more money to invest for retirement. I'm sure even as you're reading this, someone is penning a post about how by switching to generic toothpaste for the next thirty years you can have an extra $87 when you retire.

Then there are the folks who insist I'll never build real wealth (whatever the heck that is) working for someone else. In their eyes, only fools and cowards take W-2 jobs and take orders from others. Everyone should consider becoming an entrepreneur, even those who know they have neither the temperament nor the skills to be happy striking out on their own. Folks who do otherwise are making a huge mistake, even people like my aunt, the lawyer, who semi-retired very comfortably in her early fifties. Can you imagine how much more she could have made selling dog toys on eBay???

As you have no doubt guessed, I'm feeling a little burned out on the pf blogosphere today. There are lots of lovely, friendly, inspiring people out there, but there are also plenty of people who do a good job of making me question every financial decision I've ever made. I think I'm going to cut my blog reading back for the next couple of weeks since finals are looming anyway and focus on only reading posts by people I really enjoy.

I'm hoping I'll come out of those weeks a little saner. Last night at the grocery store, I found myself taking an inordinately long time to decide whether paying an extra 22 cents a box to get the macaroni and cheese I really like was worth it. I felt mildly guilty for buying an apple juice from the vending machine outside my econ class on Tuesday, even though I had the money and had been looking forward to juice all afternoon. There's this ridiculous notion that being frugal means sacrificing everything you can possibly bear in the hopes of a better future. That isn't a good way to go through life. I've got to strive for a better sense of balance.

Zero cost chariatable giving

It's the time of year when many people's thoughts turn to helping the less fortunate. I'm still debating what the best use of my charitable giving budget is, but that doesn't mean I can't pitch in a few small ways in the meantime. Even if you truly have no extra money to spare, there are many ways you can contribute that cost you nothing.

My personal favorite is giving blood. I had some anemia issues and haven't been able to donate lately, but I look forward to visiting the bloodcenter soon. There's something really rewarding about the thought that you could be helping save a life. If you're really into the frugality aspect of your giving, there's the additional bonus of blood drive t-shirts and the occasional free meal.

The internet opened new avenues for charities to raise funds. Ad revenue makes it possible for websites to offer a donation for every click they receive. The Hungersite has been in existence for several years and provides 1.1 cups of food for every visitor. Sister sites The Child Health Site, The Rain Forest Site, The Literacy Site, and The Animal Rescue Site, and The Breast Cancer Site operate on a similar model.

FreeRice.com is great. It's a nifty vocabulary quiz that provides 10 grains of rice for every correct answer. The quiz self-adjusting so it provides the correct level of challenge for just about anyone. It's a great way to prep for standardized tests as well as help others. My brother showed it to me during Thanksgiving break, and I'm slightly addicted now. (One of these days I have to score higher than level 46; I just have to.)

A good way to stretch my food budget?

While browsing a friend's church's website to find out when their alternative gift fair will be held this year, I came across information about a program they offer called Angel Food Ministries. For $28, including tax, anyone can get a big box of food. In December this buys: 4 5oz. ribeye steaks, a 2lb. lasagna, 2lb. of chicken breast, 1 lb. honey roasted pork sausage, 1 lb. chicken breast fajitas, 1 lb. meatballs, 1 lb. hot dogs, 3 lb. fresh apples, 8 oz. biscuit mix, 1 lb. mixed veggies, 1 lb. cut corn. 1 lb. sliced carrots, 14 oz. chicken broth, 24 oz. hashbrowns, 6.5 oz. hamburger dinner, 10 waffles, and one desert item. It isn't the healthiest assortment of foods know to man, but it isn't terrible either. They take food stamps as well as cash and checks.

The information sheet stresses that anyone may order as many boxes as desired and that ordering more doesn't take food away from someone else. They buy the items once the orders are in, and the $28 covers the cost of all of the food. They save a lot by buying directly and in bulk. A friend of mine has bought food from them before, and it helped keep her and her husband going after her parents decided to disown her (A long story, they are back on speaking terms with her parents, but my friends are still surviving on slightly more than minimum wage and some student loans).

I'm considering trying it. It's more meat than I generally eat in month, but it should keep well in the freezer. If I decide to do this regularly, I'd gladly volunteer to help out on distribution day. Can anyone think of a major downside to signing up for December's food shipment?

Happy Buy Nothing Day

The break from classes has been nice and relaxing so far. Thanksgiving included a nice visit with my mom's family and a gathering of physics folks at my advisor's house. It was lovely, weird, and great fun, exactly what I expect with these people.

Today, I'm going to hang out around the house with my parents, eat, clean, do homework, read, and perhaps watch my university lose at football on tv. I will not be going shopping, despite my brother's attempt to persuade me to go wait in line at 3am to buy a cheap laptop. I don't need it. I do have fleeting moments of wanting a laptop, but at this point I do just fine without one. Someday in the next few years, that will likely change, but it makes sense to delay the purchase and wait for prices to drop and technology to improve further.

My brother may not buy anything today either. There wasn't anything in the ads he had his eye on. He was still considering doing the 5am trip to Best Buy, even if he decided not to buy anything, just because he enjoys the atmosphere.

I don't get it, but I'm the sort of person who was thrilled to get all of my Christmas shopping done online last year. I find crowds most disconcerting, and not having to drive to the stores is a major plus. Based on where my parents small-town home is relative to the major shopping district in the nearby college town, I'd burn almost a gallon of gasoline to make the round trip today, so paying a bit extra for shipping doesn't seem like such a bad deal.

By this time last year, I'd finished my shopping. The gifts for my parents are hidden in my closet, but I have no idea what to get my brother. He tends to buy himself pretty much anything of reasonable cost that he really wants. Do you think he'd get annoyed if I gave him a savings bond instead?

Money does grow on trees.

There's a great old black walnut tree in the backyard. In the summer, it provides shade for lounging in a hammock with a book and a glass of ice water. In autumn when the nuts begin to fall, it becomes a bit more of a nuisance. Every other year there's an abundant crop. If you've never know the joy such a tree can provide, envision your lawn covered with hundreds of slightly squishy green and black golf balls in addition to the usual leaves. Walking outside becomes treacherous, even more so at night.

Picking up all of those walnuts isn't difficult, but it is tedious. If you don't wear gloves, they stain your hands. There are worse ways to spend a sunny afternoon than crouching, scooping up the walnuts, and tossing them in bins, but it isn't my favorite task. Fortunately, the walnuts themselves are a valuable commodity.

As a result, there are folks who offer to clear yards of walnuts in exchange for permission to sell the nuts. It's a good arrangement for everyone involved. Most people view the walnuts as a minor nuisance and are happy to have others do their yard work for free. It's a business that requires few start-up costs. There are buyers eager to process and resell the nuts once they've been collected by these middlemen so there's a near certainty of at least a small profit.

Every fall when I was in elementary school, the same elderly couple came to our door to ask if they could collect our nuts. They spent the day gathering them and then hauled them away in the back of a battered truck. Even after the man suffered a stroke, they continued to come each fall. It was clear that they needed the money. I don't think that they could have earned more than a few hundred dollars each year from this business, but for someone trying to scrape by on Social Security, that meager amount might make a big difference in comfort.

They haven't been back in several years, but others come in their place. This year, the guys who wanted our nuts came long before most of them had fallen, and so my mother and I were left to gather most of the walnuts. We have gallons and gallons of the things, and I've researched where we might be able to sell them ourselves. It won't make us much money, but since we've already gone to the trouble of collecting them, we might as well take them down the road to the buyer to get what we can for them. It's an unexpected source of alternative income, but in the future my mom will probably leave the job to others.

Float is good.

I just got my credit card bill, and the statement date was the day before they charged my card for the lab equipment. As a result, I can put off paying for that item until approximately January 6 without accruing any interest, giving me plenty of time to get reimbursed before having to pay. It doesn't really matter, but it enables me to keep a bit more cushion in my checking account without having to transfer money from savings.

The best laid plans...

Even well thought out budgets can fall apart. I've done a bit of unplanned spending this month, buying a nightgown and a math book. The nightgown came out of the Amazon gift certificate I got last month, and I might be able to persuade the powers that be that getting better at vector calculus is essential for electromagnetic theory next semester and the book is thus a reimbursable academic expense. It's worth a shot since I've got to go do the paperwork to get paid back for internet access, a modem, and almost $600 worth of lab equipment. I can afford to spend the $11.90 on Div, Grad, Curl and All That if my scholarship won't pay. (Hurrah for used bookstores and ABE Books, even though the internet makes buying books far too convenient and thus tempting).

After reviewing spending patterns from the past two months, I decided to shift some money from my grocery budget into my dining out budget. Now it looks like I'll come in under budget for dining out. I set aside $10 for a geology class Jurassic Park watching party at a pizzeria, but our prof insisted on paying for everyone. The Taco Bell nearest to campus burned down last weekend, dramatically reducing my temptation to buy fast food.

A body at rest tends to remain at rest unless acted on by an outside force.

I once had over $8,000 sitting in my checking account, earning no interest whatsoever. I'd had certificates of deposit before, but at some point I got too busy to search out good local rates, parked every penny I had in checking, added money every time I got my stipend, and just ignored it for a couple of years. That certainly wasn't the worst financial blunder a college student could make in this era of easy credit, but it wasn't a logical decision. It wasn't until I wanted to buy something big and started thinking about the impact such a purchase would have on my savings that I started trying to use my money to make money.

Sometimes economies of scale aren't a good thing.

I should never buy Oreos in bulk.

If I had a million ducats...

I've been humming that song all morning. If you like funny music and/or Celtic music, go check out The Brobdingnagian Bards. You can even listen to many of their songs for free.

You may well be asking why I have such ideas drifting around in my head. The folks at Wise Bread want to know what their readers would do if they were given $1,000,000, tax free. Most of the people who're responding are astonishingly sensible, pretty much what you'd expect of the self-selected group who read pf blogs.

My answer is fairly typical. I'd put a couple of years worth of living expenses in FDIC insured accounts, consider buying a house, stick the rest in some sensible mix of index funds and highly rated bonds, and go on with life usual for a few years with the knowledge that I had far more flexibility. Teach for America would still be my post-graduation goal, and after that I might want to go to St. John's College and study the great books curriculum for four years before graduate school in science.

My mother know exactly how she'd spend a million. Money truly would solve many of her problems. It isn't fair that over 85% of the responsibility for caring for my grandparents has fallen on my mother instead of being shared by her four siblings, but having money would ease the burden significantly. She could hire nurses and certified nursing assistants in shifts around the clock, and her 88 year old father could move back home. She'd no longer need to deal with Medicaid and all of the accompanying bureaucracy. Having staff around at my grandparents' house would also mean there would be more people to keep an eye on my grandmother, who's still quite capable of handling most of the tasks of daily life but is getting a bit more forgetful, illogical, and sometimes combative. It's the thought of having to take care of, and possibly support, my parents a couple of decades from now that keeps me scrimping and saving.

I devoted large portions of my day to shopping.

Worse still, I ended up spending $575 plus shipping and not getting exactly what I set out to buy. Before you all start griping at me about my extravagant ways, I guess I should clarify that I was ordering something for my research project. Once I submit receipts, reimbursement doesn't take long. The lab exists in an alternate universe in which money doesn't mean as much. It's weird.

Ending economic outpatient care. How do I get my parents to stop buying me stuff?

My parents keep trying to subsidize me even more than they already are. They keep insisting that since they aren't paying for college for their kids, they can afford to be generous. I'm grateful, but it's driving me a bit crazy.

When I first started looking for an apartment, I had just moved a big chunk of change into my online savings account and had a bare minimum in checking. Getting an apartment wasn't in my plans. My mother was very persistent in asking if I was sure I wouldn't be happier living somewhere else, and it became clear that she thought I should move out. (Now she thinks I ought to move home, but that's another story entirely.) Since I couldn't access my money without a three day delay for the transfer, she offered to lend me the first month's rent and pay the deposit. I promptly repaid her, but a couple of weeks ago she shredded my check and told me to keep the money.

I think I'm going to have to stop shopping with my parents entirely if I want to cut down on the amount of things they buy me. Last weekend, my father and I went to go buy some car repair supplies, and I decided to buy a pack of chewing gum. He refused to let me pay. I tagged along with my mother on a trip to Sam's Club so I could stock up on food using her membership. I offered to pay, but she said no. Arguing with her about this only makes her angry, and when I tried sneaking money into her wallet, my brother ratted me out. The fridge and pantry contain perhaps $40 of food I didn't get to pay for.

My parents want to take care of me. I appreciate their emotional support, but it's time for them to reduce their financial support. It would be much better for them to invest this money for retirement or spend it on things that give them pleasure. I have to learn to support myself and live within my means, not on my father's income.

Planning for November

I know I need to reign spending in somewhat, but I’m already off to a bad start. I signed up for internet service on Tuesday. That will increase my monthly bills dramatically, but it counts as an educational expense so my scholarship will cover it. Tonight I splurged and spent nearly $11 on rabbit ears for watching broadcast television on my computer. It’s a waste of time and money, but sometimes brainless entertainment is nice.

Utilities will likely go up in November since I’ll have to turn on the heater before too much longer. If I can figure out what to get him, I’ll buy my brother’s Christmas gift sometime this month. A carefully planned splurge may be necessary this month as well to prevent the temptation to waste even more money.

Buying clothes holds very little appeal to me, but pajamas are another story. I have plenty, but if I let myself I’d buy more at least a couple of times a year. I’m toying with the idea of buying this nightgown. It caught my eye a couple of months ago, but I resisted and reminded myself I didn’t need it. Now there’s a gift card burning a hole in my pocket. An occasional indulgence in something utterly frivolous and unnecessary sounds like the perfect way to spend a minor windfall.

October wrap-up

Spending and income were both abnormally high this month. I bought a present for my brother’s birthday, which is in November, and ordered Christmas presents for my parents. I also spent far too much on dining out, in part because I resolved to eat down my pantry and then got sick of everything I had on hand. The work on the physics standards was a one-time project. The interest earned on my savings will be far less for the next few months since my cd won’t pay interest until May.

Spending
Rent $410
Utilities $83.63 (electricity, water, landline phone, trash service)
Groceries $67.67
Dining Out $46.10
Personal $6.10 (grooming and hygiene)
Household $1.43
Miscellaneous $15.48 (transcripts and photocopies)
Gifts $85.02
Charity $1
Total Spent $716.34

Income
$626.80 scholarship (1/5 of semester housing funds)
$54.83 interest earned by savings account
$110 tutoring
$91.32 work on the physics standards
$25 Amazon gift card from wisebread
$3 Pinecone Research
$0.01 found on the ground
Total Income $910.96

A little shaken.

Someone was killed in the apartment next to mine this afternoon. The police entered to serve a drug warrant. A man in the apartment pulled a gun. He was shot and died on the scene. The landlord let the police into my apartment and the other neighboring apartments to make sure no one had been injured by stray bullets. No one else was home at the time. Most days, I'm home cooking lunch at the time that this took place, but today I was busy and just had a granola bar and a handful of cereal in the lab. Tonight I'm at my parents' house.

The couple in that apartment had some very loud fights. The guy threatened to hit, and on one occasion to strangle, the girl. I considered calling the cops, but I didn't. It never seemed to go beyond yelling. My landlord said the guy whose apartment it was wasn't the person who was killed. I think I'm going to have to ask my landlord if my neighbor will be leaving; if he isn't, I will. I don't think I want to live next to someone involved in drugs and violence if I have alternatives like living at home and commuting.

It seemed like a safe place. It's a cozy apartment a couple of blocks from campus in a fairly safe small city.

How much insurance do I need?

A post in the archives of The Simple Dollar got me thinking about insurance. When I rank my list of financial priorities, health insurance falls somewhere below food, but possibly at the same level as shelter. Fortunately, my father's group plan from work covers full-time students until age 23. Auto insurance is also paid for by my folks, so I don't have to pay for liability and uninsured motorist coverage. It's pretty clear that buying comprehensive and collision on a 1999 Taurus with over 100,000 miles doesn't make sense.

That much is simple; however, there are other decisions that take a little more thought. Do I need to get renter's insurance? If someone robbed my apartment, they'd get a computer, a microwave, possibly an iPod if it wasn't in my backpack with me, and a bunch of old jeans and free t-shirts. The computer was pricey when I bought it, since I wanted to buy the nicest system I could with the scholarship funds available for that purpose. That was over three years ago, and replacing it with an equivalent computer would cost a lot less today. I'd probably be satisfied with an even more basic computer if I had to replace it tomorrow; I'm typing this on my parents' computer, which is a low end emachines that they bought when I was in junior high. In other words, I can afford to self-insure against theft.

Still, there's this nagging thought that maybe getting renter's insurance would be the prudent thing to do. Do I need liability coverage? When I first started apartment hunting, I went by the insurance agency where my mom works to get a quote, but they couldn't give one until I had the address of the apartment. I fully intended to get the insurance, and inertia is my biggest reason for not doing so. USAA keeps advertising coverage for as little as $5 a month. (I spent that last night on pizza.) It wouldn't hurt anything to call around and get quotes.

Then there's the issue of life insurance. Conventional wisdom holds that a 21 year old with no spouse, dependents, or financial obligations doesn't need it. I'm inclined to agree, but my mother says I should look into what the premiums on whole life would be. (Just for the record, she's licensed as an insurance agent, but doesn't sell it. Her responsibilities at the agency she works at are solely administrative stuff.) She's suggested it as a way to lock in premiums for life, a way to ensure I'll have coverage regardless of my health in the future, and as an investment. It came up once in conversation, she hasn't mentioned it again, and I'll probably just blow it off.

I wish I were shopping right now.

I don't really need to buy anything, but I'm still disappointed that I had to skip a shopping trip with friends to study tonight instead. It's undoubtedly best to avoid the temptation, but it would have been fun to go to Target and hang out with them.

Windfall!

I happened to win the drawing on Wise Bread's commenting contest this week. Now I need to figure out what to do with a $25 Amazon credit. Should I save it for buying Christmas gifts or go ahead and spend it on some math books I've been wanting? It's nice to have this kind of money problem for a change.

Frazzled but happy

It's already been a long week. After reviewing my grant proposal with my adviser this morning, I printed the final revisions and trudged across campus in the rain to deliver all 18million pages (originals plus copies in triplicate) to the appropriate office. When I got there, I had to wait in line to meet with someone to have my work looked over. He discovered that on a form that required the signatures of my adviser and the department chair in two places, they'd only signed once, and I hadn't caught it. I raced back to the Physics Building, where I caught the vice-chair in the lobby as he was leaving for lunch. I then spent 45 minutes waiting outside the classroom where my adviser was teaching, and then rushed back to deliver the forms. They seem ok now, and my university will submit them to the state by November 1. Once they reviewed them again, I was seriously late for my 1:30 class, and I made the (perhaps unwise, but sanity saving) decision to just skip it.

I then went to Human Resources to prove that I can legally work in the U.S. and then to the treasurer's office to pick up my paycheck from the work I did last month. It's much larger than I expected, but I'm not complaining. Does anyone know of a good option for opening a Roth IRA with $91.36, or should I try to pick up a couple more hours to bring the total above $100 so I can start one at a local bank?

Since I was already skipping class, I hung out in the honors lounge with a friend, drinking hot chocolate, reading The Economist, and complaining about the grant writing process. I don't think my lab kids are going to get me anywhere near my best today so I hope my co-TA is well prepared and peppy.

The world's least exciting weekend

I have a grant proposal due Monday by 4:30p.m. If this is bad, writing a thesis must be terrible. I'm going to go eat lunch and hope my adviser emails me with comments on my project description. If I win the grant, I'm sure I'll be delighted to get an extra $1250 to pay myself for my work, but right now it's surprisingly difficult to care.

Success

J.D. at Get Rich Slowly has asked people to post about their greatest financial success. There will probably be scores of truly inspiring stories about people who overcame great obstacles to work their way out of poverty, get out of debt, and create better lives for themselves and their loved ones. This isn't going to be one of those stories. I've had a pretty easy life when you get right down to it, and my accomplishments are pretty mundane.

I'm a twenty-one year old student with a positive net worth, and my parents aren't paying for my education. They would have helped pay for tuition if I'd needed help, but they seem pretty happy that they don't have to. I take a certain pride in knowing I earned the scholarships that are financing these four years.

Yes, I was very lucky. I grew up in a home in which education was the number one priority. I also live in a state with a serious brain drain problem so high schoolers with top scores and grades are considered a valuable resource worth spending tax dollars to keep.

However, I'd like to believe that planning and work played a role as well. I started thinking about college admissions as a tenth grader. I spent hours searching for scholarships, studying for the standardized tests, and honing my essays. Ultimately, I had to make some tough choices. My top pick, a prestigious but pricey liberal arts college, offered me the largest amount of merit aid they give, work study, and loans, but it remained financially out of reach. It just wasn't worth taking on tens of thousands of dollars of private loans when I knew I wanted to go on to graduate school as well. Instead, I accepted a full ride to the honors college within my state university.

As a result, I now have more flexibility in planning life after graduation. It's much easier to consider taking a low-paying but fulfilling job when you don't have debt repayment hanging over your head. In addition, not having to pay for college has allowed me to diligently sock my earnings away. It isn't a fortune by any means, but it's a nice little nest egg that might someday become a college fund for my own children.

Never pay full price for maxi pads again!

Sending away for free samples can really help you stretch your budget. I know it's dorky, but I also really like getting things in the mail. The samples are generally small so that alone won't make much of an impact on your spending, but since they often send coupons along with the samples, you can cut your costs on things you'd buy anyway by checking whether the manufacturer's website offers samples or printable coupons.

In the past month, I've gotten free samples of feminine hygiene products in the mail twice, once by going to the manufacturer's website and once from the free sample section at Wal-Mart's website (just type "free samples" into the search box on their main page). Now I have two $1 off coupons for my preferred brand that are good until June of next year so I can wait for a sale and then stock up. I take a similar approach to toothpaste, deodorant, soap, and other non-perishables.

I'm out of money. Now what?

Yep, the spending last week got a little crazy. Overspending on groceries combined with the unwise decision to take a friend out to dinner mean I've overshot my budget by a lot. If I want to be certain of covering rent and electricity without spending more than 1/5 of this semester's housing funds, I essentially need to refrain from spending any money on anything else until after Halloween. [curses under breath]

Things aren't really as dire as all that. As my brother pointed out last night, I've got additional stipend money I was planning on saving and thus didn't include in the budget. In addition, as soon as I go home to get my social security card I can pick up my (small) paycheck for my side job for my adviser from last month. However, the budget should have been entirely manageable, as I demonstrated last month.

I was stupid. I messed up. I should live with the consequences. I think I've got enough food that I can keep grocery spending to a bare minimum for two weeks while I eat down my pantry and freezer. It doesn't sound like fun at all. Please remind me why I'm doing this.

Jimmy Carter was right.

You should put on a sweater if you're cold. You can lower your utility bills and reduce your carbon footprint. What could be better than that?

Thrifty behavior and environmentally friendly behavior are frequently one and the same. Compact fluorescent bulbs save money over their lifetimes even though they require a slightly larger initial outlay. Better home insulation lowers heating and cooling bills. Water heater blankets and shorter showers will reduce your bills as well. Beans and rice are far cheaper than meat. Thrift store and yard sale shopping mean you sometimes can get an entire outfit for a couple of bucks, and nothing new had to be manufactured to satisfy your desires. The list could go on and on. Please, consider whether a few small changes could help both your pocketbook and your planet.

Getting the basics right is half the battle.

I was a little amused by an article in the New York Times last month on why it is important to save money. It boggles my mind that rational adults would need to be reminded of that. Unfortunately those who most need to learn that lesson are probably the least likely to peruse the business section.

Today the editorial section of my local paper reprinted a piece from the Washington Post. It's an eloquent defense of the virtue of saving. I'm tempted to write these words on a scrap of paper to keep in my wallet for weak moments, "But it's worth remembering, as did generations of Americans struggling up from poverty and privation, that thrift is still the essential virtue that makes the American dream possible."

Useful information about the real world

I'm hoping to do Teach for America, and if that doesn't work out, I will get a master's in teaching and teach for a few years before graduate school in the sciences. First year teachers with bachelor's degrees in my area can earn $40,000 at some school districts and significantly less at others. Teachers with master's degrees are paid more. So I'm guessing that if I teach around here, I'd make at least $35,000. I've been wondering what sort of lifestyle that would entail.

This quarter's issue of U25, USAA's free magazine for young adult members, helped answer that question. A short article called "Paycheck Reality Check" states that after federal taxes, FICA, and Medicare, the net pay for someone with a salary of $35,000 would be around $28,356. After deductions for health insurance, take home pay is generally closer to $2,113 a month. I'm not sure how the pension program would affect this amount or what state income tax rates are, but this information gives me a starting point for further investigation.

I'm starting to actively dislike my budget.

My budget simply isn't working. I left out too many important categories, some by choice, others without thinking. I concluded that I own too much clothing already and left that out of the spending plan, but the sneakers I've been wearing for the past three years have developed holes. Forgetting entertainment entirely wasn't the best move either. Randy and the Mob sounds quite funny so I wish I'd planned for the cost of an occasional movie ticket.

Should I revisit my plan? It would be nearly impossible to cut back in other areas to fund such spending since there isn't much wiggle room as it is so the overall result would be additional expense. If I really want to, I can forge ahead with the budget I've already made. It covers the true necessities. It'd feel like a little bit of a failure to cave in and spend more. Self-discipline is something to cultivate. At the same time, all of this scrimping with no bigger goal in mind feels pointless. Isn't part of the point of diligently saving that you can occasionally enjoy your money? Less than a week ago, I was able to write a check for $10,000 for a cd, but my budget makes me feel broke.

Grocery shopping with my kid brother

I love my brother. He's almost twenty, and he's slowly turning into a really neat person. For a while during our teenage years, I doubted whether we'd ever get along, but these days we quite enjoy one another's company. We still have big, loud, frightening fights sometimes, but we also have long, joyful, rambling conversations. After a long, trying day there's something very soothing about macaroni and cheese and silly sitcoms with the one other person on the planet who'll ever fully understand all of the weird family stuff.

As much as I love my brother, I probably shouldn't grocery shop with him. We're diametrically opposed when it comes to money. He firmly espouses the view that you should go ahead and spend on things that will increase your short-term happiness. He isn't totally profligate and does have some savings, but my brother doesn't seem to have a problem with embracing his acquisitiveness. He tries to get me to lighten up about both money and life, and I'm afraid he's making some progress on the money front. When I shopped with him, I spent about ten dollars more than usual and got a bit less food. It was very nearly worth it.

Impulsive money moves

Yeah, wild and crazy girl that I am, I changed my plan for what to do with the money I transferred out of my savings account. After getting rate sheets from a slew of banks, it became apparent that I could do as well locally as I could with ING. I ultimately and, I admit, somewhat rashly decided to put the entire sum into a seven month cd instead of creating a ladder. This way all of my assets will be liquid again just before I graduate. Since I am somewhat uncertain where life will take me after that, it seemed not unreasonable to want to be able to access all of my money. I may end up kicking myself in May if I don't need to spend the money and rates plummet, but it seemed like a less than terrible decision this morning. Or at least, like a better long term decision than blowing all of the money on a used Miata. Darn responsibility.

Shuffling my savings around

HSBC responded to the Fed rate cut by cutting the rate they offer on online savings to 4.50% apy. The mortgage crisis has the potential to get much, much worse, and it could be a long fall indeed if consumer confidence plummets in response. At this point, I'm guessing at least one more rate cut will be forthcoming in an effort to stave off recession. I don't know enough to determine whether that will have the desired macroeconomic effects.

I do know that it has a less than desirable effect on my finances. High interest rates are pretty nice when you have no debt and keep essentially all of your money in savings accounts. To avoid the fun and excitement of watching interest rates drop still lower in the coming months, I've decided to move approximately two thirds of my savings into certificates of deposit. At this point, I think I'll split the money equally among 6, 9, and 12 month cd's to build an instant ladder. That will leave just over $5000 in my savings account separate from the money I anticipate needing for living expenses. That seems like plenty of liquid cushion for now.

September spending

I've used Pearbudget to calculate the final spending numbers for September, and I think I like it a lot so far. Before I state the numbers, I should include a disclaimer: I'm not totally self-supporting. My parents pay for car insurance and gasoline, have me on their health insurance plan, and feed me whenever I'm home, which seems to be quite a lot the past couple of weeks. In addition, my mother keeps trying to buy food for me, and occasionally I cave and accept a hunk of cheddar and some mini pizzas rather than fighting with her when she shows up at my front door with a bag of groceries.

Spending
$410 rent
$83.61 utilities (includes landline phone, electricity, water, sewer, trash service)
$59.05 groceries
$8.36 dining out
$23.51 personal (hygiene and grooming items, high this month due to coupons and sales which made it advantageous to stock up on some items)
$6.43 household (laundry detergent and windshield washer fluid this month)
$5 miscellaneous (club dues)
Total Spent $595.51

Income
$626.80 scholarship (1/5 of semester housing funds)
$90 tutoring
$5 American Consumer Opinion
$0.12 the one and only time a reimbursement for school expenses I've submitted has ever resulted in a check for more than I paid rather than less
$0.01 found on ground
Total Income $721.93

In making these calculations, I ignored the school expenses and subsequent reimbursement, except for the extra twelve cents they gave me. I didn't count the wages for the work I did for my adviser since I haven't been paid yet. I also didn't include the interest earned on my savings since I've decided I'll count that as income whenever I receive a bank statement and I did not receive one for September.

Ok, I think I can quit pondering whether it's ok to buy a pack of gum when I go grocery shopping.

Getting paid for work is still awkward.

Tutoring this semester is a good thing. It's almost certainly making me a better teacher for my lab because when the girl I tutor, L., struggles, it's a safe bet some of my other students are having similar problems. It's also pretty much covering the cost of groceries.

I should be happy about that, right? Somehow, instead I feel mildly guilty. It's awkward at the end of each session when L. digs a ten dollar bill out of her pocket and thanks me. It's clear she doesn't come from a wealthy family. Her finances are tight. This is her last semester as an undergrad, and she's certain she'll have to work and save before she can apply to pharmacy school. Doing well in this physics class will help her get in and achieve her goals, so she seems to think paying for extra help is a good investment. I should be paying her. Watching her slowly build mastery is a great joy. She makes me feel needed, and she laughs at my jokes.

At this point in my life, I have the luxury of taking only jobs that please me. As a result, the work I end up doing is generally something I'd happily do for free. There's something very peculiar about being offered an additional reward for such a rewarding activity. If it's possible to go through life enjoying what I do to earn my bread, I should be content, but I can't quite get over the feeling that that's almost cheating. Shouldn't work involve sacrifice?

Is personal finance software worth it?

Today in a meeting with my thesis adviser, he bemoaned losing the files he hadn't bothered to back up when his wife killed their home computer. He mentioned that he'd lost his most recent entries into their financial software and wasn't sure whether he would spend a few hours redoing it. I resisted the temptation to ask him whether he used Quicken, Money, or built something in Excel since I knew if I got him talking we'd never get around to discussing my project.

I've pondered whether I would benefit from using financial planning software myself. Since at this point in my life I have a checking account, a savings account, and might get a c.d. but don't have investments to manage, I don't think I need to shell out the dough for a big, fancy, needlessly complicated software program. (If you can think of a compelling reason why I should change my mind, please let me know.) There are lots of simpler free options that might be fun, however. I'm just not comfortable giving my password to a third party so financial aggregator sites aren't appealing. I've considered using either PearBudget, which is a nice worksheet for using with a spreadsheet like Excel or OpenOffice, or WalletProof, which is something you do online, but for some reason I haven't so yet. Do you see any major advantages to budgeting on a computer?

Right now my budgeting system is pretty basic. I have a little purple spiral notebook that I've started recording every bit of income and purchase in, including the sixty five cents I spent in a vending machine last Friday. It was simple to calculate how much of my scholarship money I should spend each month to make it last for the entire semester. Every time I get a bill, or, if I'm really lucky like last week, a reimbursement check, I sit down and crunch the numbers, generally on the back the envelope the bill came in. I'm not kidding. My financial planning system consists solely of a ten cent notebook and a mechanical pencil. It's surprisingly satisfying.

A big part of why I worry about finances

In some ways, my grandparents are an example of how to be sensible but still end up with financial problems. My grandfather is 88, and my grandmother is 82. They are part of the the last generation that will be taken care of by their former employers in retirement. My grandfather was in the Army Air Corps, became an officer in the Air Force, and spent 21 years in the military. After that he worked as a budget analyst in the aerospace industry and then became a realtor. My grandmother raised five children and then became a nurse. When they retired, they had a substantial nest egg, my grandfather's pensions, and Social Security. They bought a modest two bedroom house in an inexpensive area of the country.

In the early 1990's my grandfather had his first stroke. He made good progress, but a couple of years later he had another stroke. He developed a bad case of pneumonia in 1999, and he made it through but has been much frailer and on oxygen ever since.My grandmother was able to care for him with help from my mother, and later, a few hours a week of paid help. The stress on her was intense, but she managed. Then, last summer my grandfather needed surgery. Afterward, he became so weak he became immobile, and physical therapy was of limited use. My grandmother attempted to bring him home, but after less than a day it became apparent that he needed twenty-four-hour nursing care. It was tough on her (and on the rest of us), but there was simply no alternative.

These days, we're fretting about when my grandfather's Medicaid application will be approved. My grandparents have spent the vast majority of their savings, and their monthly income doesn't cover his care, let alone also provide for my grandmother. A year of paying for a nursing home has wiped them out.

Soylent Green is people!

I haven't bought meat since I moved into my apartment. I've eaten some at meals with my family. When it's provided, I sometimes partake, but I don't feel any great need to cook it for myself. When mad cow first reached North America, my family cut way back on beef consumption. My mom added soyburgers to the list of frozen staples she keeps on hand for quick meals. With cheese and mayonnaise they aren't exactly health food, but they are tasty and still lower in fat than decent ground beef. (Really lean beef isn't good in burgers. It just isn't.)

For the most part, I'm satisfied with a mostly vegetarian diet with occasional seafood. A really great cheeseburger once every few months is enough red meat. Am I saving money by living this way? Probably not, even though the lowest possible cost vegetarian diet is certainly cheaper than a meat based diet. I haven't run the numbers, but I suspect I could get cheap beef or turkey for less than a soyburger, although beans and rice beat them all. Am I improving my health? I'm not sure. I still like cheese, which isn't exactly low fat, and I now have to be more careful to consume enough protein and supplement my iron with a good multivitamin.

I like meat. It's a normal part of the human diet, but not in the quantities modern Americans eat. Frankly, the environmental cost of meat production is significant, and we have a better shot at feeding the world's growing population if we don't divert so many of our resources to livestock. Meat is an indulgence, a great treat to be savored, but it shouldn't be at the center of every meal.

Just plain tired

Right now I'm feeling worn down. I've been trying to keep busy because then I have less time to dwell on things that aren't going well. It works up to a point. The most positive thing I can say about all this is that will be good for my finances since part of the reason I've been busy the past few days is tutoring and a job working for my advisor. Tonight I finished the part she asked me to do, but if I did it well, there may be more to do in the future. When she asked me if I had time to do this, she said, "Of course, we'll pay you so you can start an IRA." She knows me well.

Finances and my folks

My parents have been pretty good financial role models. They always stressed the importance of spending less than you make. My dad in particular was willing to be quite open about their finances when I started to ask questions when I reached my early teens, and my parents have been fairly sensible with money. They kept a substantial emergency fund. They bought a house with a 30 year fixed rate mortgage when I was in preschool and paid it off when I was in junior high. They contribute the maximum allowed to my dad's 401k (although that is less than the maximum the government allows due to rules that try to ensure that retirement plans don't disproportionately benefit higher paid employees).

They paid me an allowance and took me to the bank to open my first savings account. My dad suggested I read The Only Investment Guide You'll Ever Need and taught me about the wonders of compound interest. My mother explained how to build a good credit history and why it's so important. My mom and dad taught me all of the fundamentals.

It's strange that they now come to me for financial advice once in a while. They know I enjoy reading about personal finance and thus know more of the technical details of some aspects than they do. My mother decided to start an IRA last spring before she filed their 2006 taxes, and she asked me for recommendations, had me look over her options with her, and had me do the actual typing to set it up online. She went with my recommendation of the Vanguard Target 2015 fund. Considering that my parents are in their mid-fifties and have all of my dad's 401k in something that guarantees the principal but doesn't have much growth potential, it would have made sense in theory to put it all in stocks. In practice, however, my parents became extremely conservative investors following the tech bust, and my mom is pretty panicky about the idea of losing money. She was reluctant to put any money in stocks at all. Now she's finally becoming a bit more comfortable and not contemplating moving her money every time the fund goes down a bit.

When is it ok to stop worrying?

If nothing else, the project of tracking every cent I spend for the rest of 2007 is keeping my attention on my finances. I'm no longer quite so certain that's a good thing. The goals I set for myself were pretty ambitious: I wanted to live out the semester on nothing but the housing allowance from my scholarship, $100 extra for the expenses of moving into my own apartment, and any money from tutoring. There was no real need to be this frugal since I worked this summer, get an additional stipend on top of the housing money each semester, and could easily dip into savings a bit as a result. Before I decided to get an apartment, I planned on using the roughly $60 my online savings account earns each month as an allowance. For some silly reason, I concluded that it would be better to not touch that money and instead build my savings.

I'm beginning to think I'm making myself unhappy over nothing, fretting about whether it's extravagant to spend $3 on a Lean Cuisine dinner at the end of a stressful, sleep deprived week rather than trying to figure out something novel to do with beans, rice, and frozen veggies. Last night I was actually worrying about how to save for Christmas gifts for my family, an expense of perhaps $100 total. It's silly to treat what's left of money I earned this summer as untouchable, and even more silly to try to save a stipend that's supposed to help with living expenses.

This may cross the line into pathological if I don't keep it in check. Frugality is good, but there are limits. Adult life is rushing at me very fast, and I am very much adrift. Saved money can be a source of security, but saving because I'm frightened and it is one of the few things in my life I can control probably isn't the wisest approach to money.

Quantum mechanics might just kill me.

Ok, perhaps it isn't as bad as all that, but so far intro to quantum hasn't been pleasant. I'll probably have to lean more on the proposed study group. Clearly, the expectation value for momentum has to be real, but despite my best efforts and lots of time, I have an i that persists in one of the homework problems.

I've purchased an additional book in the hopes that Griffiths will help me through the points when I'm confused by Liboff. A classmate said he has the solutions for Griffiths so that should serve as a collection of worked examples. I'm hoping the cost of the extra textbook is something my scholarship will cover and have submitted a requisition for reimbursement, but if it isn't $24.83 seems like a small price to pay for potentially learning more in a difficult class. (Side rant: If they can sell international editions so cheaply, why don't they use cheaper production methods for books sold here as well and not charge and arm and a leg?)

Yay! I'm no longer broke.

The bank located the deposit slip they lost so the money will be credited to my account tonight. It's a relief. It wasn't as though they could just lose my money and never give it back, but it's very nice that they handled this with a minimum of hassle. They were apologetic and helpful. I guess the take home message is always save your transaction receipts, at least until you confirm that your statement is correct. Errors do occur.

Bank statement panic

Tonight I was digging through the pile of mail that arrived in the past couple of days and came across my latest checking account statement. This is not good at all. I'd been going merrily along, thinking that because I keep track of my transactions and account balance I had nothing to worry about. I was wrong. I haven't used the internet banking feature even though I set it up this summer since I promptly forgot my password. I have occasionally gone to an ATM to check my balance before making a large transfer to savings, but I generally assume that my bank is doing what it is supposed to. Every month I check the statement, and until now there had been no surprises.

This time, a quick glance at the ending balance revealed that all was not as it should be. 623.51??? There should be over five times that much! The housing money didn't appear on the statement even though I deposited it a week before the statement period closed. It should have been available the next business day. Tomorrow I'll go sort it out. I'm still hoping that the deposit got credited in the past couple of days. If it hasn't been, I'll have to spend the time I really needed to catch up on school things that didn't get done this weekend proving to the bank that they owe me money. (This is why you should always save your transaction receipts.) Just how much of a hassle will this be? My bank is small, local, and has always had great service at the main branch so I'm hoping for the best.

Mourning

I apologize for the unplanned hiatus. My father's younger sister died Wednesday. It was quite a shock since she was only fifty two and had been in reasonably good health. My dad and brother saw her last summer, but I had not visited my aunt since my cousin's wedding three years ago.

I spent the weekend surrounded by family. It was sad and strange, but also as good as such a weekend could be. There was much hugging and crying, many old family stories, a few jokes, and way too much food.

Getting paid is nice

Today was my second tutoring session. My student is paying me $10 an hour. After I asked her if that sounded reasonable, she said she'd paid $20 an hour for calculus help last semester so this probably could have been more lucrative, but trying to explain basic mechanics is so enjoyable that I don't mind. It looks like I might make ten to twenty bucks a week for several weeks, or perhaps the rest of the semester. This really takes a bit of strain off of my finances. It might be possible to save this semester instead of merely breaking even.

On the other hand, it might be sensible to allocate some portion of this unexpected windfall to frivolous spending. StoryGirl's post on what she calls "The Chocolate Croissant Effect" is a charming and insightful commentary on small indulgences. It's important to find a balance between working toward far-off goals and enjoying some of the rewards of your effort now. I know that I'd take a certain satisfaction in seeing my savings account balance grow or buying another I-Bond, but sometimes a scoop of frozen yogurt, some really great bread, or a pretty lipgloss is nice too.

A realistic food budget?

I'm attempting to keep my spending on groceries (and dining out on the rare occasions I do that) to $25 or less a week. This seems reasonable to me, especially since my parents still expect me to eat their food whenever I am home. (In addition, it seemed to make my mother pretty annoyed when I insisted on paying for my own groceries when we went shopping together today, but that story probably deserves its own post.)

Yet, I keep getting strange looks when I mention the food budget. Is this amount unrealistic? I'll buy generic, clip coupons, shop sales, and plan quite a few meals around beans and rice or peanut butter and jelly on whole wheat bread. Can anyone out there give me an idea of what it costs them to eat frugally yet healthfully?

Feeling rich

It's strange how the ten bucks I made tutoring today feels more significant than the housing reimbursement check I deposited.

The awkwardnes of getting paid for work

I have a tutoring job lined up. One of the students in University Physics I was quite nervous about the class and contacted the professor looking for someone to provide one-on-one help. Tutoring is somewhat fun, and I always feel somewhat weird taking money for things I would probably have done for free anyway. Nonetheless, money is useful, and my time and experience are of value so I should charge something, right?

How much to charge is a trickier question. I've never been comfortable setting rates for my services. When I used to occasionally babysit, I just took whatever the parents decided to pay. As a result, I'm pretty certain that some of the time I was underpaid. (Based on what I've read, a responsible college student who is trained in cpr and first aid who's watching a two year old and a very rambunctious five year old for the evening and must make dinner and put the kids to bed should almost certainly not be making less than $5 an hour.)

What's the best way to bring up payment? How do I figure out what to charge? Undergrads working for the university in the tutoring center make over $7 an hour, and much of their time is generally spent doing their own homework while waiting for students to wander in. Graduate students have posted fliers advertising one-on-one math tutoring for $20 an hour or more. Does asking for $8/hour seem reasonable? Would $9 be too greedy? Should I wait to see if my student suggests a price?

Paralyzed by longing

After an exciting, all expense paid weekend at a state park in Missouri (ok, so actually sitting a conference room all day isn't terribly exciting), I should now have a very good idea of how to go about applying for teaching programs. I intend to apply to Teach for America, and possibly the Mississippi Teacher Corps. I'm less likely to apply to NYC Teaching Fellows. Two months of living and working in NYC was a great life experience but also very overwhelming. New York is wonderful in many ways, but smaller university towns can have thriving cultural scenes and a greater sense of community.

So, I know what I should be doing tonight. My personal statement needs revision. I should contact one of my references tonight by email to make sure he's willing. I should get this stuff over with. If this is my new direction, then my time and resources should be concentrated on doing this before the workload for classes intensifies.

Why am I finding that impossible? If I do this and get in, I will be forced to accept that another path in life is gone forever. Until late June, my plans for life were very different. There was a nice young man who said he wanted to spend his life with me. His plans changed quite suddenly. Actually, his plans for just about every other area of his life changed several times over the past few months, but he insisted that I remained the one constant. Teaching was still my goal, but I was planning to get a teaching degree at my university because he would be here for that year. One day he insisted that "Our plans are too different," claiming that I was uncertain about whether I wanted marriage and children. It was untrue, but he stuck with his decision and refused to offer further explanation. Now, we pass each other in the hallways each day, but he does not speak to me. He seems irked when I attempt to speak to him, or even make eye contact. I know that I must now plan for a life alone, work towards the goals I had been willing to compromise on because I valued him more, but I struggle to get through the days without tears.

Setting savings goals

It's tricky to figure out what appropriate savings goals are while in college. Most of the advice out there is geared to folks who have a full-time jobs, bills, and a normal adult lives. College students are generally assumed to be nearly broke, except in the occasional articles focusing on very young entrepreneurs who suddenly became amazingly wealthy through creativity, luck, and insane drive

I fit into neither of those categories. Through good fortune with scholarships (and parents who were happy to not have to pay for tuition or room and board and have thus been overly generous in insisting on paying for some incidental expenses) I am in better financial shape than many my age. I have no school debts and have accumulated a chunk of savings by saving scholarship stipends and summer income. Today, not including loose change and after spending money on rent that will eventually be reimbursed, my net worth is $15,746.25.

Many months ago, the goal was to save $10,000 before finishing college. It's probably time to revise that goal. It seemed like a nice round number, attainable, and enough to live on for many months in a worst case scenario. Now, if I manage to avoid dipping further into my savings between now and when I get a "real job" rather than an internship that is technically a fellowship, I'll be able to fully fund a roth and still keep the emergency reserve. Would it be silly to try to not dip into my savings for the next year but spend the interest? Is it reasonable to take a hiatus from savings?

It might be good to scrimp and save for a down payment, but buying a house will be several years in the future. An extra few dollars a week now could make a fairly dramatic difference in my day to day life, and an extra couple hundred bucks in savings probably won't make much difference once I have a job. Yet, it feels irresponsible to slack off.

Grocery shopping for entertainment/procrastination

Tonight, in an effort to further delay writing a personal statement for a workshop on applying to graduate programs and fellowships, I went shopping. Much as I hate to admit it, I sometimes enjoy browsing in stores. That, however, creates the dangerous temptation to spend money on impulse. Grocery shopping feels slightly more virtuous; I have to eat, right? I have all of these cabinets just begging to be filled, and meal planning will be much easier once I have more staples on hand. I'm still in good shape when it comes to fruit, vegetables, milk, and some frozen foods since I've been eating lots of the free pizza as my main dish. (I'm quite glad to have finally eaten the last piece tonight since I was getting sick of it.)

Tonight I went on a pantry stocking mission. I got three cans of fat free refried beans, two pounds of brown rice, tortillas, and taco sauce for making burritos. I bought parmesan cheese to go with my favorite quick dinner of cheese ravioli and tomato sauce which I already have on hand. I got a big container of oatmeal and some brown sugar for very inexpensive breakfasts. I got onion powder and garlic powder since they improve so many dishes. I got a box of my favorite macaroni and cheese for a day when I need comfort food. I indulged in dried apples and dried cranberries to encourage myself to eat more fruit. I got jello, instant chocolate pudding mix, and two multipacks of sugarless gum since I've been feeling very deprived without desserts. I also bought four packages of ramen noodles since I do genuinely like them even though I wouldn't want to live on them. The grand total was $21.10 with tax. I think I did pretty well, but if anyone has suggestions for frugal meals for the next shopping trip, please let me know.

How I pay my bills

This afternoon I mailed bills associated with the apartment costs for the first time. The electric bill for the first five days I had service was $5.90, but I don't think I can use that to extrapolate costs for a whole month. I used the air conditioner a bit, but I didn't do laundry, use my computer much, or run the dishwasher during that time. I also mailed my rent check for September. I am pretty sure I got far too nice an apartment. $410 is a lot.

I hope that my housing allowance requisition gets processed before I have to pay October's rent. It should come through long before then, but I've seen the problems they've had with the system in the past. As part of my scholarship, I am allowed to either live in the dormitories and eat in the cafeterias or request that money to spend on a place of my own. It comes to $626.80 a month. (Regardless of where I live, I also get a stipend of $1000 dollars per semester as well. If I live off-campus, I may also request the cost of internet access, which I haven't gotten yet but should look into.) I originally hoped to cover rent, utilities, food, and household expenses using only the housing allowance. I do plan to give myself a personal allowance out of the interest from my savings account.

If I am very frugal about food and very sparing in my use of electricity and water, that might work, but I'm not sure I can be very frugal about food for ten months straight. Temptations abound.

I am more than a little annoyed with AT&T.

My parents were fairly insistent that I needed to get a landline phone in my apartment. I grumbled a bit but eventually agreed. According to AT&T's website, the plan with unlimited local calling is $17. I concluded I could probably fit that into the utilities portion of the housing allowance from my scholarship and signed up. Because I went through the sign up process online, the initial $45 fee was supposed to be waived, and I have the email to confirm that. I did all of this on August 10 and was supposed to get service between 8am and 8pm on the 13th. By the evening of the 14th, I still didn't have phone service so I used my parents' phone to call customer service. After spending a long time trying to use the automated system to get through to a human, I became very frustrated indeed, especially since the computer insisted I had an unpaid bill (despite having never dealt with AT&T before) and repeatedly demanded I enter my social security number to confirm my identity (despite my having never given AT&T that information in the first place). I then got put on hold, talked to an actual human about my problem for 30 seconds, went back on hold, talked to another human who had none of the information I'd given the automated system of the other human, went back on hold, and finally talked to another human who had none of the information I'd previously given others but who was able to enter something in her computer to tell them to turn on my service and who assured me I did not have an unpaid bill. All told, I spent about 40 minutes trying to resolve the problem, most of it on hold.

Today I received an order confirmation in the mail. It states that my monthly rate is $23.71, not $17, and that there will be a one-time charge of $45. I don't know if there is anything I can do about the extra $6.71 a month, but I will NOT be paying them a $45 fee that I have proof they said they would waive. I'm not looking forward to spending my afternoon on hold, but I guess I need to address this as soon as I get done with my last class. I'm would almost consider switching to ham radio as my sole means of voice communication if this is what dealing with the phone company is going to be like. I am already licensed.