Tag Archives: money

Embracing the Inner Cheapskate

I’ve been writing a “statement of need” for an adoption grant application and been trying to explain how poor we are. Not poor enough that we can’t handle the adoption of course, but poor enough that we need help. Which raises the question of what’s “poor enough”? After all, who doesn’t need help, especially these days?

It’s been an interesting exercise. At any rate, I found myself trying to describe our family as financially responsible and frugal and trying to give realistic examples to back it up. I kept wondering what other people do to be cheap. After all, one person’s frugal is another person’s extravagance. One person’s necessity is another person’s luxury.

I want to share a few areas where I think my family is being cheap—not to brag, but to share some thrifty ideas. I hope you’ll share your thrifty ideas in the comments. It’s kind of a touchy subject because everyone has different values (cable TV may seem like an extravagance, but if it’s your only entertainment expense and you never go to the movies or buy DVDs that might be pretty economical), but I hope maybe we can learn something from how others have done it. Saving money is always good, but especially in this economy.

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Consistency is the Key to Generosity

I meet with my tax guy today, which means I’ve been frantically pulling together forms and statements and crunching numbers. I hate accounting and I’m horribly disorganized when it comes to that stuff. Which is exactly why I hire a tax guy. It’s always wise to hire people who are really good at the things you’re really bad at.

Anyway, I had an revelation as I was looking at the numbers for our charitable giving. I felt like I’d been pretty generous this past year. My wife and I have talked a lot about generosity and giving and being more intentional about supporting good causes, not just with our words but with our wallets. We’ve tried to support causes as they come up and not be so cheap about it. Personally, I’ve tried to only plug the causes I’ve actually donated to. It seems disingenuous to spread the word about something but not chip in yourself.

So with all that focus on giving, I thought we’d do pretty well for 2009. Go us.

Turns out our giving is down compared to 2008. By quite a bit. Doh.

There can be all kinds of factors at work to explain this, including the fact that we made less money in 2009 or we were more tight-fisted because of the travel expenses to Ethiopia or whatever. But I think the real factor is consistency.

While we tried to actively donate to more causes in 2009, the result was a lot of tiny donations. $10 here, $20 there. That’s good money and it will go to good causes, but it doesn’t add up to much. It’s a drop in the bucket. What does add up is consistent giving. Weekly or monthly donations add up a lot more quickly. That sounds completely obvious and it is (I told you I hate accounting), but it doesn’t really sink in until you sit back and look at the numbers over a period of time.

Our donations were down in 2009 because we lowered one of our consistent donations. It seemed financially prudent at the time (and still is), but it means we gave a lot less and our impact is likewise reduced.

Like much of life, it comes down to consistency. If you really want to make a difference in anything, you have to work at it consistently. You can’t just do something once and expect change. It’s true with teaching your kids, it’s true with learning any skill, it’s true with work–and it’s true with money.

[Note: Money and giving can be a pretty touchy subject. I’m not trying to tell anyone how to do it, I’m just sharing a lesson I learned. I also don’t mean to minimize one-time donations. Those one-time donations add up when you bring them together (remember how they made me bald?).]

School Loans & Audio Adrenaline

I just received a statement from Wells Fargo showing a breakdown of interest, principal and total paid on our school loans over the past 8+ years. And the current balance, of course. Horribly depressing. Even more depressing when I consider that’s only one of our student loans (and let’s not talk about a mortgage).

About 10 years ago I interviewed Bob Herdman, keyboardist and guitar player for the Christian band Audio Adrenaline. At the time I was an intern, working my first real writing job and doing one of my first real interviews. I had no idea what I was doing and the fact that a “rock star” would just call me up like that for a phone interview was incredible. Little did I realize how mundane that is.

Anyway, the article would cover Audio Adrenaline’s college years and what Herdman learned from college, a fairly interesting piece for the Christian college guide it would appear in. (Reality check: It never appeared. The college guide was never published, due to all sorts of insanity I didn’t understand at the time, nor will I get into here.)

At one point in the interview Herdman mentioned that he still had school loans he hadn’t paid off. He said something about paying $50 a month for 10 years now. He could have been exaggerating, I have no idea, but I remember being horrified at the thought. Imagine it, a successful rock star with outstanding college loans. Granted Audio Adrenaline was never a mainstream success. But they had plenty of success in the Christian market, at that time were releasing their fifth album (Underdog) and were still riding high from their 1996 hit album Bloom (certified Gold).

I knew Christian rock band wasn’t exactly a lucrative career path. I knew Herdman may have had other spending priorities (my own financial advisor talks about student loans as “good debt,” a concept I understand but still bristle at). But still. I couldn’t fathom the concept of a successful rock star not having paid off their college loans yet.

And here I sit, 10 years later, looking at a loan statement and beginning to feel sympathy instead of bewilderment. I wonder if Herdman finished paying off his school loans?

Economic Hardship Is Real, Not Perceived

It always cracks me up where I hear people talking about the current economic woes as if it’s all a matter of perception. They assume people aren’t spending money because they perceive a crisis that really isn’t there. They blame the media or whoever for giving us this negative perception.

It always makes me laugh.

Do they have any sense of reality? Do they know anyone who has lost a job? It seems like every week I add another person to my growing list of unemployed friends and family (thankfully I do see people coming off that list, but it’s still growing).

People aren’t spending money because they don’t have any to spend. Maybe that didn’t used to stop us Americans before, but it is now.

I’ll admit that perception may be a part of it, but for a lot of people I know, the reality is they don’t have the same income right now as they did a year ago. And they’re adjusting accordingly.

I came across an article today about some financial expert who said the worst is yet to come and that our standard of living is undergoing a “permanent change.” I don’t know if that’s true or not (the financial experts seem to have less expertise these days), but it doesn’t seem like a bad thing. It’s not going to be pretty and it’s going to hurt, but a lower standard of living might be what we need. Now more than ever the financial advice to live beneath your means (not just within them) makes a lot of sense. This economic downturn wouldn’t be so difficult if we did that.

And that difficulty isn’t perceived, it’s real. Just ask a contractor.

Ten Dollar Reagan

Ronald Reagan supporters are pushing to have his likeness on some cash, among other places. Current discussion includes putting Reagan on the $10 or $20 bill, though both proposals would require an act of Congress. Another option is to put Reagan on the dime, or possibly on half the dimes produced (leaving FDR on the other half of all dimes produced), something the Treasury can do without approval from Congress.

All of which causes me further speculation about what made Ronald Reagan so great. Speculation that, by the way, is thoroughly honest, innocent, and not malicious, as some seem to think.

It seems especially ironic to consider putting Reagan on our money considering the divided feelings over Reaganomics. According to that CNN/Money article, the idea behind Reagan’s economic policies were to lower taxes, decrease government regulations, and increase military spending. The result was 20 million jobs, a huge drop in interest rates, and a $3 trillion debt by the end of the decade. The opposite approach seems to be Bill Clinton, who balanced the budget and didn’t cut taxes. I’m no economist and I don’t really know how to compare the two, but I do know that the mid-to-late 1990s had quite an economic boom as well. An NPR commentator pointed out that the economic growth in the 1990s was more evenly spread throughout society.

Interesting points to ponder.

At any rate, I find it especially peculiar that there’s a Ronald Reagan Legacy Project with a goal of “seeing a Reagan commemoration in every American county” (Star Trib). Furthermore, they’d like to add Reagan to Mt. Rushmore (though they might have to settle for the road that leads to Rushmore). Apparently there are only some 54 memorials to Reagan across the country, compared to more than 600 for John F. Kennedy and more than 800 for Dr. Martin Luther King, Jr. Apparently it’s a race.

But seriously, it makes me wonder about who we honor and why we honor them. Why are there 600 memorials for JFK? Was his shortened presidency that great? Was averting a nuclear war in the Cuban Missile Crisis that much of an accomplishment? Or was he just a popular guy and we feel bad he was shot?

I understand that it’s important to remember the past and honor national heroes, but all the rangling over who’s a better hero or a more worthy hero is really odd. And at one point is one hero better than another? When can Reagan, hero of the Cold War, replace Alexander Hamilton, hero of the Revolutionary War? Because there’s only so much space for memorial. I can imagine a park absolutely cluttered with bronze statues to hundreds of years of American presidents. You’d be walking on the George H.W. Bush Memorial Sidewalk reading your Official Gerald Ford Map and sucking away on your large Bill Clinton Sodapop.

All the while no one can remember what any of them did.