March 18, 2009

Before we moved to the Greenhorn Valley, we were between homes for a couple months.  So we rented two storage units and moved all our stuff into them.  On the day we went to move out of them, we discovered one of the locks had been busted.  We looked around and noticed that many of the locks on the other units had also been busted.  We threw open the door with the busted lock and noticed immediately that the TV was missing.  Several of the boxes were ripped open.

How can I describe the feeling at that particular moment?

Panic.  What do we do, what do we do?  Do we call the police?  Is the guy still around?  Can I stop him from getting away?  Let me at him.

Anger.  THIS IS MY STUFF!  You can’t have it!  I paid for that lock and I rented this room and you can’t have it!

Horror.  How much is missing?  Is anything  damaged?  How bad is it?  I think I’m going to be sick.

Violation.  Somebody has invaded my private space and rifled through my stuff.  More of me is known than I wanted to be known.  How can I redeem that and get my privacy back?

In the end all we lost was the TV and its remote (that’s what they were looking for in the boxes).  Although I’m happy the damage was as light as it was, it still took a long time to sort through all those feelings.  And I still can’t quite figure out what they were thinking.  It wasn’t one of the new, flat TVs, it was an old tube-type TV.  I can’t believe they wanted it.  Is there a black market for ten-year old technology?

So we suffered a material loss.  The TV that we spent money on was gone, and we were going to have to spend more money to get a new one.  Also, the lock was gone.  Of course, it was a cheap lock.  We learned to always get the tamper proof locks whenever we’ll be locking things up out of our sight.

And we suffered an emotional loss.  We had to deal with all of these feelings, feelings that arose in a heartbeat, but took a long, long time to beat down.  I’m starting to see that the psychological damage that people sue for is actually a real thing.

I don’t expect this column will be read by many would-be thieves.  But maybe the economy is bad enough you’re no longer above such actions.  Please consider that there is a lot more than money or possessions at stake.  What would be your response if someone broke in stole your stuff?

This article originally appeared in the March 18, 2009, edition of the Greenhorn Valley View.


March 17, 2009

We haven’t had a lot of snow this winter.  Experts are predicting a dry summer.  Dry spells aren’t any fun.  You water as much as necessary to keep things alive, but you don’t water everything because water is limited and expensive, and you don’t want to waste it.  What lessons can a drought teach us about our finances, in a time when we feel like our money is drying up?

Water what’s necessary

Just as you provide water to your best plants or trees during a drought, you’ll need to do some careful watering of your money, too.  You want to make sure you’re paying all your bills.  Don’t neglect to pay for the electricity, water, gas, and phones.  Food is fairly important; make sure there’s always some of it to put on the table.  You also need to keep up with basic maintenance on your home and car.  Repairs that seem expensive now might break the bank later, after you’ve allowed them to get worse.

Don’t water everything

On the other hand, there are some things that don’t make sense to spend money on right now.  Now is probably not the best time to sign up for cable or satellite TV.  You may not need the best new cell phone or the best new laptop.  A new car or an addition on the house also don’t make sense if you have other goals that are more important, or if you’re worrying about running out of money.

Once we’re through this financial drought, times will be better.  It may take us a while; it might be this year, or it might be many years from now.  Keep being sensible about spending, keep searching for a job, don’t leave a job without another one lined up.  Keep the dinners out and the new iPhones to a minimum.  And imagine the green garden waiting for us on the other side!

This article originally appeared in the March 11, 2009, edition of the Greenhorn Valley View.


March 6, 2009

Here’s a cool idea for getting by in a down economy: bartering.  If you’re like me, the last time you thought about bartering was in the ancient middle east unit in world history class in high school.  But don’t write it off just yet; there are a lot of advantages to bartering.

You don’t have to be the best at everything

If you’re really good at handy-man type repairs, you could trade it for some computer work.  If you have a freezer full of beef, you could trade some of it for lawn work.  If you’re fluent in French, you could teach someone else in exchange for car repairs.  If there is something you can do, you can probably trade it for something you suck at.  If you have something, you can probably trade it for something you don’t have.

No sales tax

Quick math problem: at 6%, how much sales tax would you have to pay on that one-hour French lesson?  None, right?  Just about any good or service you buy in a store or through a service provider will require that you pay sales tax.  But with bartering, no money has changed hands, so there isn’t anything to tax.  The more you barter, the more sales tax you don’t pay.  This is not true with regard to income tax, however.  You are legally required to report bartering activity to the IRS.

Strengthened relationships

The benefit to bartering that is the most difficult to quantify is the effect on the relationship between the two parties.  And being difficult to measure makes the benefit immeasurable.  If you’re known as the guy that can get a dead car running in the middle of winter, people will want to keep you around.  If you’re known as the guy that can thaw a frozen computer and retrieve thousands of dollars in invoices, people will be glad to get to know you.  These kinds of bonds help to form a tight support network that is difficult to fall through.

So think about things you can do or make, or things you have stockpiled, that other people might want.  You may find yourself saving some coin, and also becoming an integral member of the community.

This article originally appeared in the March 4, 2009, edition of the Greenhorn Valley View.

how to give more

March 2, 2009

In these tight economic times, giving can be extremely hard to do.  You need every penny you bring in.  How can you afford to give anything, since it will require you to give up something?

While this dilemma is one that more and more people are facing lately, it should be noted that, if you’re not facing this dilemma, you’re not really giving.  Whoa!  What do I mean by that?  If you’re a giver, but you give out of your excess, giving doesn’t really affect you or impact you in any meaningful way.  If you have money to pay all your bills, have some fun, invest for retirement, and invest for your children’s education, and you still have enough left to give some away, how much does that gift mean to you?  It doesn’t represent a sacrifice of anything on your part.  You haven’t really given anything of yourself.

On the other hand, if money is tight at your house, but you choose to give some anyway, you are giving up something else you may have wanted.  Maybe you can’t eat out as much, or maybe it takes longer to save for your down payment, or maybe you have to wait until next month to get the car fixed.  If you give in the midst of these circumstances, your gift represents an actual sacrifice.  You have to give up something real and immediate in order to give.  If you keep this up for any length of time, you’ll also have to wrestle with personal, philosophical, and theological issues, and wrestling with these things will make you more human, more genuine.

Have you ever been presented with a real need, perhaps someone seriously hurting, but you don’t have any way to give?  You want to be ready to give at a moment’s notice, not be stranded with nothing available.  The trick is to decide beforehand how much you are going to give.  Every payday, set that amount aside in an envelope under the mattress.  Then, when you hear of someone with a need, you won’t have to struggle with how you’re going to come up with a gift.  Just go to the envelope and grab some cash.

You can also put $20 in a back corner of your wallet that you never go to, just so it’s there when you need it.

Use whatever tricks will make you more generous.  But don’t miss the opportunity to give.

This article originally appeared in the February 25, 2009, edition of the Greenhorn Valley View.

boy time

February 19, 2009

One day last week I was feeling bored, melancholy, down in the dumps.  Nothing in particular was going on, just another day of fruitless job searching and web surfing.  I got it into my head that I should run to town and bum around.  I could go to the electronics store that’s going out of business to see if I could find any good deals.  I could go to the book store and poke through some new titles.  I could grab a sandwich at my favorite lunch joint.  And just so it wasn’t a completely wasted trip, I could stop at the grocery store and pick up some things my wife wanted.  It would get me out of the house, give me something interesting to do, and I wouldn’t have to eat leftovers for lunch.  A perfect plan.

The plan started to fall apart, however, when my son asked if he could go along.  It seems hanging out with mom all day is no longer real exciting for an eight year old.  If I was going, he was going too.  But this was no longer exciting for me because I couldn’t linger over the Bluetooth headsets and the just-released hardbacks.  He would be bored.  Also, if I bought anything for myself – like lunch – I’d have to buy one for him too.  Being out of work, I could justify one lunch, but two?  That would probably break the bank.  And to top it all off, my wife thought of a couple other things I could do for her in town.

So now I had a choice.  I could go to town, but not do any of the fun time-wasters I had in mind, or I could just stay home, disappointing my wife and son.

Wanting to get out of the house more than anything, I chose to take my son and do the errands laid out for me.  In the end, I didn’t spend a bunch of money I didn’t have, I saved my wife a lot of running around on her own, and I got to spend some significant time with my son.  Although we didn’t have any earth-shattering conversations or discover the cure for cancer, we were together – which was all he wanted.  The day was spent much better than I had planned, and I was much happier than if I had spent a bunch of time by myself and bought a bunch of things.

It turns out, being selfish isn’t really what I wanted.  I wanted to be useful.  And needed.  If you’re out of work, or otherwise have a bunch of time on your hands, look for ways to give of yourself.  Sacrifice your time and money and desires.  Don’t waste the opportunity to create situations and relationships that you’ll value for years.  Boys need their dads.  And I think dads need their boys just as much.

This article originally appeared in the February 18, 2009, edition of the Greenhorn Valley View.

winds of trouble

February 12, 2009

It’s windy. The wind is blowing through the valley, knocking over trash cans, blowing shingles off roofs, and blowing right through the windows in my bedroom. I toss and turn wondering if the windows are going to make it through the night. Wind can do a lot of damage if it’s powerful enough.

The economy is kind of like the wind. People are losing jobs, retirement accounts are worth half what they used to be worth, and people are nervous, worried and anxious about how they’re going to survive.

I have a friend that has a trampoline. A big one. The kind of trampoline that can hold a whole birthday party full of kids, and the dog too. During one of our windstorms last year, he woke up and found his trampoline a few blocks over, the surface was chewed up and the legs were bent and twisted. So he brought it home, fixed it up, and anchored it into the ground. His trampoline hasn’t wandered since.

What can we do to anchor our finances to the ground in this windy economy? Whether or not you’re getting through this recession in one piece, now might be a good time to go over the basics of financial planning, and make sure all your ducks are in a row.

Pay off debt

Debt is the opposite of an anchor. If you want to be immovable, pay off your debt. With no debt payments to make, you can withstand a lot of economic abuse. A job loss or a shrinking retirement account won’t worry you, because you won’t need as much to live. And it goes without saying that you can’t incur any new debt. Put the plastic in your underwear drawer and forget about it. When the cash in your wallet is all you have until the next payday, you’ll think twice about spending it.

Emergency fund

A good emergency fund is too often forgotten about, until the water heater goes out or the car needs a new alternator. Charge those expenses to your credit cards, and you’ll be blown away by the next violent wind. But an emergency fund is an anchor that brings peace of mind. No burned out water heater will keep you up at night.

Control spending

If you don’t have much money at the moment, be careful how you spend it. Buy only what you need, and even if you have a little left over, don’t spend it. The wind will eventually stop blowing and then you can splurge a little, but you can’t be sure how much damage you’ll suffer before then.

Give freely

On the other hand, don’t be stingy with your money. If you have some left over and know someone who could use a little extra, lay it on them. Giving money away pays great returns. It’s encouraging to the receiver, and it builds a community of people who know they can always depend on each other.

Spend some time right now thinking about your financial anchors and how you can make them stronger.

This article originally appeared in the February 11, 2009, edition of the Greenhorn Valley View.

first time home buyer’s tax credit

February 4, 2009

There is a new tax credit this year, aimed at first time home buyers.  If you bought your first home last year, you can claim a special $7500 tax credit on this year’s tax return.  If you are already getting a refund, even without this credit, the credit just adds to your refund.  If you owe money to the IRS, this credit will be reduced by what you owe.

The credit is available to anyone who purchased their first home between April 9, 2008 and July 1, 2009.  If you bought your first home between April 9 and the end of 2008, you can claim the credit on your 2008 tax return.  If you buy your first home between the first of 2009 and July 1, you can claim the credit on your 2009 return.  Which means there is still time.  If you’d like to buy a home, but are not sure if you can afford it, this credit might be just enough to put you over the line if you can do it in the first half of this year.  Of course, be sensible – don’t jump in over your head just to claim the credit.

What is a first time home buyer?

For purposes of this tax credit, “first time home buyer” means you can’t have owned your own home at any time during the past three years.  Which means if you owned your home in the past, had a three-year string of incredibly bad luck, during which time you rented, but now you are in position to buy again, you too can claim this credit.

Credit or loan?

Although this credit is called a “credit,” it is actually an interest free loan from the government.  You’ll get the $7500 now, but you’ll have to start paying it back in two years.  You’ll pay it back at a rate of $500 a year for 15 years.  This payback will either reduce your refund or increase the amount you owe on future tax returns.

One very sweet way to take advantage of the credit, and remove some of the sting of the loan, is to go ahead and claim the credit on your return, but then just sit on the money.  Park the $7500 in a bank or invest in a well-structured CD ladder.  The interest you earn is yours to keep.  It’s not much, but it’s more than you would have had without the credit.  You just have to make sure you have $500 available each year to pay back the government.

As narrowly defined as this credit is, I don’t imagine many people will be able to benefit from it.  If you were able to claim the credit, what did you think?  Was it worth it?  Let me know what you think.

This article originally appeared in the February 4, 2009, edition of the Greenhorn Valley View.