Ralph's Recurrent Rants and Raves

I have a feeling that "financial denial" is a major cog in the credit industry's machinery. Back in the day, people didn't have this tool to get them in financial trouble, they just had to suck it up and stop spending, to balance their budget in real time! I know I have always hated to think about money, and that's a mental block I really need to work harder to get past. And my immediate family also has it, big time. They are all too happy to let me suffer through the misery of trying to make ends meet all on my own. I've said it here before, that I always meant to go all Ross Perot on their ***es, to show them just where the problem is and what we have to do. I suppose it all comes down to me being too much of a wimp. But I am quite aware that it's doing my daughters much more harm to allow this to continue to fester than to get them involved in buckling down and dealing with life.

That said, when expenses just rain down, I understandably get depressed. Large dental bills, the ever increasing gas and food bite, and the big kahuna college along with persistent old debt can be a TAD overwhelming.

Screwed! Well, not totally, yet, but I sure feel like it. I am realizing that I can't use my 401k for the kids' college costs because withdrawals go against my income, so I would qualify for no financial aid at all if I do that. And I can't borrow the whole thing, especially for 7 years in a row. And to make a sad story even sadder, it looks like my FICO score went down recently after I had to refinance some expiring 0% debt to a promotional 1.99%. BoA juggled the credit limits on three CC accounts I had with them. They said it wouldn't adversely affect my FICO score, but something sure did last month - not sure how much lag time is involved, it could also have been financing $10k of college costs on a credit card back in January.

So if anyone can see any bright lights at the end of the tunnel for me that isn't a train, please let me know! Thanks.

It was a convenient time to have the family together, and it was combined with a required trip. The best thing was I felt like I got good value, largely since it was lunch and not dinner, so that goes a long way toward making it OK. But what felt the best is that it sort of fits into the budget since I realize we can eat out only SOME of the time, so we need to cut pretty deeply into our old habits. I had a feeling of being more in control since I have been scrimping more and more the last month, so a rare treat seems reasonable. That said, I know that we have lots of trips coming up that are VERY expensive largely due to eating out, so I need to keep this rare. And voila, when it is rare it is more of a special treat, as opposed to more of an everyday occurence. I still have a long way to go in improving our family's cooking and eating in capability, but I like baby steps, not wholesale change.

I think I've been able to make a difference by more frequently keeping lights and computers off. And I'm ashamed to say that somehow the setback thermostat had gotten put on HOLD, so once I remedied that and went back to 60 degrees at night, I think that made a pretty significant difference. I'm thinking of shaving a few more degrees off at night since we all like it cool for sleeping anyway. And it's much more palatable to do that than to cut back on AC in the summer. It feels great to get back to my frugal roots. I had just about given up the situation for hopeless, thinking it wasn't worth sweating the smaller stuff. Boy, was I wrong!

In the interest of logging my expenses, today on a quiet Sunday I spent:
$20 for the daughter to go to a banquet - ok, she very seldom spends money so she is well entitled. BUT, while I was waiting for her, I checked out a used book store and spent $17.08. I think they were good investments though - two tremendous cookbooks - one vegetarian and one quick and easy meals. Like most people, cookbooks I buy often languish, but I chose these carefully. They are very simple with big pictures and simple ingredient lists and directions. And since I was thinking we need to go to more of a "rice and beans" type diet, these look like just the ticket.

I also bought milk and and $.80 donut for the daughter, again a well deserved rare treat. But I think that's about it! Dinner was leftover veggie lasagna that I made on a whim last night and it turned out to be very tasty, although a tad too watery. I had to spend more for the mozzarella since on Saturday they were sold out of the sale stuff. But I bought a brick instead of the pre-shredded stuff my wife usually buys - man, I hope she only buys that on sale!!! One step at a time. We are making great progress with another takeout free weekend! Yay!

I also refinanced some short term CC debt left from Christmas at 13% to 2% for a year. Unfortunately I had to roll some expiring 0% into that. And I got started with Quickenonline to put the finances under the old X-rays. And now I am going to renew my AAA at about $130/year for my wife and me. And I should decide if I want to go for the Comcast Triple Play for a year to get rid of $40 in phone bills. But I don't want to risk losing my phone # when I have to switch back in a year, so if anyone has experience with that, please let me know. So I guess this has been a somewhat expensive day! Luckily just about all weekdays are zero spend for me. I always take lunch to work. I sliced some Italian bread that costs $.99 instead of using bread from the $3.50 load of packaged bread. I want to start baking on the weekends, both to save a little and to have a better product. Did you know they use High Fructose Corn Syrup in bread?!!

It does have some limitations, but if you want to do a quick snapshot of your spending, it works very well. My Credit Union keeps three months worth of online data, so it downloaded that pretty easily. So the bottom line over the last three months is it said we are overspending by a couple of thousand! Sounds about right with Christmas. It only does budgeting very simply by comparing the last month with the four month average. But it did point out that gasoline is killing us!! My wife drives a van that only gets about 17 MPG with her usual driving, so she must be driving a lot more than I thought!

One thing that is misleading is that we often get cash back when using the ATM card at the grocery store, so a lot of cash is lumped in with groceries. Any suggestions on how to handle that? I'm pretty sure I will buy regular Quicken with one of those tax software package deals very soon, maybe with one of my Christmas Gift cards, since I know it lets you split transactions like that and the web version doesn't. By the way, I tried the free equivalent at mint.com, but it didn't accept my credit union accounts.

Here's about the best online info I could find on the individual components of a credit rating:

http://en.wikipedia.org/wiki/FICO_score

It is an unfortunate fact of life that I have to keep shuffling while I try to pay down balances. But when I shuffle to a new 0% or low rate, how much of the available credit line should I use? I'm thinking maybe 90% to maximize the amount of cheap money, but trying to stay under the triggers for ratio of debt to available credit. But I have no idea what the triggers are, or even if they are on an account by account basis or a cumulative basis.

Boy, if this one from the Wikipedia http://en.wikipedia.org/wiki/Credit_history#How_credit_ratin... article is true, I am REALLY in big trouble! It brings up a very interesting point though, since I am looking at transferring OUT of a CC with a high APR but a low minimum payment to one with a very low 2% APR and most likely a much higher minimum payment.
# Control of debt - Lenders want to see that borrowers are not living beyond their means. Experts estimate that non-mortgage credit payments each month should not exceed more than 15 percent of the borrower's after tax income.[citation needed]

One more bit of info - the Credit section of my wamu CC account (which is very nice, BTW) implies that maybe it's 50% of an individual credit line that they look at. My score did go back up last month and looks pretty good right now.

We avoided ordering out two nights this weekend, probably saving about $30 - not too bad, definitely a much-needed step in the right direction. Annualized, that comes out to $1560 after tax dollars!! And speaking of tax, it's good to keep in mind that ordering out is penalized by the government with the 7% sales tax.

So the major setback was that onto the CC went college books and a few hundred of travel expenses for taking my daughter back to college and stocking her up, totalling darn near $1000. Oh my, college is going to be a miserable financial experience!

Does the price of bread irk anyone else? And if so, what have you done about it? I always try to buy it in the grocery store for around $2 (store brand or sale), but since I seldom do grocery shopping, too often I have to buy it at the convenience store for $3+. We have a bread machine that has never been opened since it was new about 20 years ago (yes, I know, stupid), that I really should at least try, that is if I can find it!

So on the way out with my $3.19 bread, I noticed the blue water (windshield washer fluid) was $3.79!!!! And I felt bad for buying it for $.88 a while ago since it can easily be made with probably about $.20 worth of alcohol in water.

It seems like almost every task I get lately is so monumental that is it discouraging. But what I need to do is always the same, slog through it one step at a time. And the obvious key is you can't give up, no matter how tedious or discouraging it gets. OK, this was a pretty simplistic entry, but something that's good to keep in mind. As an example, my wife takes down the Christmas decorations and I have to jam them into storage, and that's definitely better done a little at a time, mainly to avoid overworking the old back.

But another facet of being relentless in pursuit of a task is that you need to take some breaks. I just got done sweating over making the Spring college tuition payment, so I need to take a short break before hitting taxes and FAFSA, but not so much that I lose my momentum and fall behind. This is a major goal I have, to stay the course without losing focus or burning out. So I need to be tenacious, something that comes easily to me only if it's something I am very interested in, so it only makes sense that I HAVE to be very interested in my own and my family's financial well-being.

I find it pretty amazing that they can have so much loss from bad debt. CEOs and other executives get paid all these millions and they still make fundamental blunders like that? And for those of us working to pay off debts, how does it make you feel to see so many people just get to write theirs off? Sure, it comes with a lot of pain, I'm sure, but it still seems like we are heavily subsidizing people who made bad decisions, whether through the stock market crashing or public bailouts and stimulus packages being tossed around frantically in DC right now.

About the only thing we can do about high gas prices is to combine trips out the wazoo. I did that tonight - dropped my daughter off at swim practice, bought dog food, got gassed, went to get my hair cut but it closed early tonight, had a $1.27 (with tax) salad at Wendy's, got the car inspected, bought some motor oil and windshield fluid cheap at the grand opening of a new conveniently located auto parts store, then went back to swimming and walked until my daughter was done. The only downside is I bought a new brand of dog food that was cheaper and highly recommended by the store, but the dog won't eat it! And of course it's a 40 pound bag. I've been putting treats in it, but so far she has been eating around the food!

Back to topic, I have also been driving like an old man. I call it the "poor man's hybrid". The key is to use the brakes as little as possible and to plan ahead as far as possible. For instance, as soon as I see a light turn red, I lift off the gas and coast up to the light, unless there is someone right behind me. It is actually sort of a fun game, seeing just how much I can optimize. And as a benefit, I give myself plenty of room in front to avoid hard braking at all costs. Of course this style of driving is much easier and more effective with a manual transmission car where you get engine braking. When I drive an automatic transmission car, I can just feel the gas and brake pads being wasted.

After budgeting for the essentials, there just isn't much room for cutting in my budget. It seems like all I've got are the perennial targets, food and household items. Severely reducing eating out costs is the easiest score, but my wife's fast food habit will be tough to break. And she always gets the expensive combos, where I always get the $2-3 worth of items from the value menu with water to drink in the rare case when I am stuck eating fast food.

A big part of my budget is CC payments now that most credit card companies have raised the minimum payments to something like 2% of the total, and the last CC balance transfer I had to take for college might be 3%!! My CU still has the ridiculously low minimum payments though, and that really can lead to trouble. Before I always had the attitude "Later", but now I realize that I can't do that, "later" has to be NOW!!

I want to get back to logging expenses with software. I am intrigued by the online one provided by Yodlee.com and mint.com, but for some reason it scares me to have to provide bank account login info. But I guess you have to do that to connect with any software, so maybe it comes down to company trust? For better or worse you sort of have to trust Microsoft and Intuit, but Yodlee is pretty unknown, to me anyway. Any experience out there?

If I don't go the web based route, I like Moneydance since I have both a Windows and Linux PC, plus I can download the trial version first to give it a try before buying.

Oops, I see I should have searched the forums first, Yodlee turns up quite a few hits. So you can assume I will read them all in any answer. But at first blush it looks ok since many major banks use their service.

OK, my initial experience with Moneydance is not too good. I have multiple accounts with the Credit Union and it is only seeing the one account, even when I never typed its number in, only the number of the other account.

And the Yodlee/Mint preview demos look very good, but I'm still nervous about putting all my info on one web site. Maybe I will just look for a good sale on Quicken after all.

My finances have hit an iceberg (college). I should be getting the women and children into the lifeboats, right? The water level is rising fast! So saving another $100 or $200 a month probably isn't going to save our ship. Not that I can ignore cutting expenses, but I need to make more drastic maneuvers. Oh well, until then, I don't like the position of these deck chairs!

My wife is dealing with a hit and run in a parking lot now, making a police report, I think. So I wonder if my insurance company will jack up our rates again, even if we don't make a claim??! (See earlier similar rant). It feels like I am in the Twilight Zone since we keep getting hit and our rates keep going up at the same time our cars get more dented. The high school parking lot took a HUGE toll on the car my daughter drives - dings all over the doors.

I was pretty shocked when applying for a college private student loan for my daughter that even with me as a co-signer, they wanted to charge 10%, with a 3% origination fee!! Does anyone have any idea if it could have been because my credit rating is only about 722, down from 745, or was it just because of my daughter being a college student with no job?

In any case, I'm trying to improve my credit rating by not having any charges with a balance near the limit. I'm thinking that this will be essential to get student loans at a decent rate. I guess I'll put in for my free credit report right now to get the story on why it recently decreased by 20 points (according to the Wamu website). I haven't really done anything recently that would have caused that that I know of.

Later addendum: I am happy to say that Discover came through with an excellent rate, about half of Chase's!!! It sure pays to shop around - too often I think "they're all the same" - definitely not true.

As I figuratively soared high above my finances to get a bird's eye view, I decided it's definitely not good to look down! When your CC debt is not too much less than your annual take home salary, THAT is a problem. Oh well, one day at a time! In my case it averages a thousand or two a year for 20 years or so, but I think it has only been accumulating over the last 10 years, or actually it has to be less since I can't have juggled 0% rates for that long! Oh my, I have work to do!

I am wondering if you can deduct accrued interest or only paid interest on these? I'm pretty sure it would be paid interest only, but I figure there might be some people out here with experience on it. I'm also wondering if you can make extra payments on them, since the payments seem to be more rigidly structured than most loans,

I (she) need(s) to take out a private student loan to get my daughter through the next semester. But I can't decide whether to select deferred interest, pay interest only, or pay principal AND interest. I'm probably giving all of you a financial heart attack by even considering the first two! But this is only the first of eight years of college. I told her that she will have to pay the incremental over a state school, which comes to about $20k per year! So even though this one will be her responsibility, I can't see just letting the interest fester and add up! On the other hand I need to consider my ability to make payments. And the rate is fairly low, about 7%. Ideally I would select deferred payments and then make more payments as able. But I have CC debt to pay off also, currently at 0% but I can't keep that up much longer and it could roll to a bad rate.

It's interesting that to a large degree in both my parents and my wife's parents, the man solely supported the family at first in the traditional model. But then the women took over for Act II, supporting the families from roughly age 50 or so.

But even more interesting to me is that both families sort of just barely got by, and yet the impact this had on my wife and I has been very different. It turned me into a natural cheapskate, very at home here. But to her, it meant giving her daughters what she never had. Both very reasonable reactions. But needless to say, it has caused trouble and conflict and led to our current less than ideal financial situation. I should also say that neither of us learned squat about finances from our parents or anyone else really, and we have unfortunately repeated that mistake in our daughters. For some reason I don't think our schools here ever had a class like that for kids, but I'll have to double check that, especially for the one still in high school where there is still time.

So I know what we need to do, to instill financial common sense in all of us, but I need a strategy, mainly a way to broach the subject. We are in this mess because whenever I bring up money, I get stonewalled. So I've often thought we needed a combined marriage/financial counselor, but as you might expect, I'm much too cheap to seek out and pay such a person, if they even exist. But as I'm sure many of you here know, there is a difference between being financially sensible and just plain being cheap. If there really was such a person and I had gone to him years ago, we would almost certainly be better off.

And lest it sound like I am laying too much at the feet of my wife, I am the one who allowed this to happen, it's my life that is affected, so I have to take some blame for not dealing with my problems in a timely and effective manner. Man, life is complex! I just wanted to get married and live comfortably.

Perusing this year's tax form I see that I made a big mistake. Suffice it to say that you need to consider the consequences when you do something, ESPECIALLY something big. Do I know that? Yes. Do I always do that? No! Why not??! I sure hope Ron White isn't right that you can't fix stupid!

Well, at work it's free, so that was easy! And at home, usually I use a HUGE Walmart container of ground decaf coffee in a drip coffee maker with a gold plated filter. That permanent filter feels very good to use since I always hated throwing money away on coffee filters for the European machines. Good old Mr. Coffee filters were so cheap it was no big deal, but these Euro cone ones were always pretty expensive. At first I didn't like that the permanent filter let the very fine grounds through, but now I just think of it as extra body, like espresso. So one downside of this arrangement is that it takes me so long to go through the big can (weekends only) that it loses its punch toward the end of the can. For a special treat, I use store brand beans, I think they are relatively cheap for beans, somewhere around $2-3/lb versus the usual $5-6.

So this saving helps balance out when I lose control and have to get frappucinos at Starbucks/B&N once in a great while. Like a lot of people, I have trouble resisting those horrible-for-you but oh-so-good concoctions! But anyway, I feel pretty good about my overall success in cutting coffee corners.

You know - old shoes, old cars, old clothes. The top of the list for me is my good old car, a 1995 Honda. I'm totally comfortable and familiar with it - everything falls to hand immediately. It's familiar like an old friend. But the best part is no car payments! I just can't see tying all that money up, even though I truly love cars and would be in heaven with a nice new high tech, responsive machine. But that's just not in the cards for me right now, even though for most people my age it is. Does it bother me sometimes? YES! It sometimes seems like everyone on the road is driving a BMW except me! And I know most of them don't drive it because it's "the ultimate driving machine", they just drive it for the status (not that there's anything wrong with that, although I'm guessing there may not be THAT many of you here to offend) I would appreciate the superb handling and road feel, etc., but I could not tolerate the high maintenance costs. But that jealous feeling doesn't last long. I look around on the roads and see my kindred spirits, all the people driving comfy old cars, usually young college age kids. My favorite car of the genre is the 90-93 Honda Accord - man, most of those things still look new! What an investment! They just keep on going and going, and still look pretty stylish to my eye. So, every time I drive my car I smile inside thinking of the money I am not spending on interest and depreciation.

From there the scale goes down pretty quickly. There is the Dell computer from 2000 that is still cranking away. Before that I think I had the same computer during about all of the 90s. Then there is my 1988 bicycle that has given me more pleasure per dollar than seems possible. So then we get to the poster child for this subject, the old shoe! Now perfectly molded to my feet, it just feels so good! And the same for old clothes, both much to the chagrin of my wife. I love that patina of age, I wear it like a badge of frugality, within reason of course, I don't think I look like a bum, I just look comfortable. So anyway, depreciation is the silent killer!

I've only got a few in the house, definitely all the lights that are on the most often, but I haven't done the ones that are used very infrequently. I guess I should watch for good sales. I wonder what the story is on duty cycles, i.e. which can take more off-on-off transitions?

Here's a good reference on that - they don't like short cycles.

http://biz.yahoo.com/usnews/071219/19_faq_the_end_of_the_lig...

And a general reference:
http://en.wikipedia.org/wiki/Compact_fluorescent_lamp

DH I got: Designated Hitter, er, I mean Domestic Housemate or Dear Husband.

OOPS! Now that I wrote this out, I'm going to guess Dear Daughter and Dear Son! Dang! I was only thinking Domestic Housemate, but as soon as I googled up Dear Husband for DH, it hit me! OK, I've still got a question though. Is DD(7) an age or number? Playing the odds, I'd say age.

Man, you people are a bunch of kindred souls as far as being cheap, er, I mean fiscally responsible - how refreshing! I get so tired of being Jack Benny, where everyone accuses me of being cheap! Actually, I do sort of take a page from his book and use it as my schtick. But can you believe how many people think being frugal is a BAD thing? Yes, I know, they are probably talking about being Ebenezer Scrooge, not the reasonable measures taken by most of us here. Anyway, thanks for understanding!

But that's only half the equation, and I definitely need help on the investing side, since I am one of those people who wishes I didn't have to deal with money. Plus investing has always seemed too Las Vegas-like for my tastes. Anyway, I am sure you will help me improve.

I recently started eating store brand oatmeal for breakfast instead of cereal. I had previously switched from Kellogg's, etc. on sale to Malt-O-Meal cereals that are always $2 to $2.50, but going to oatmeal is another quantum leap in cost lowering, since they sometimes go on sale pretty cheap for those HUGE containers, and even if not on sale, they are still WAY cheaper than cold cereal. And I needed to start eating oatmeal anyway for cholesterol reasons, since I refuse to take potentially liver damaging statins unless I absolutely have to.

I also started cutting back my "hour in the shower" (for you people who remember that old Chicago song). Who doesn't love to linger under that nice hot water? But it's just too costly, not to mention wasteful. The shower I use the most still has the "elephant shower head" of Seinfeld fame, so I need to consciously dial it back.

The last thing I'll bore you with is shaving. I used to use disposable razors, but they are just so harsh I was ALWAYS getting cuts and nicks. So I used that nice free-in-the-mail Mach III, and I love that thing! It shaves very comfortably, quickly since I don't have to worry about cuts, and a blade lasts FOREVER, at least on my wimpy whiskers. However, I am VERY ashamed to admit here that I did finally break down and buy a big pack of replacement blades, not even on sale! I'm sorry, won't happen again! But now I pretty much have a lifetime supply of them! And my can of cheap Barbasol gel actually feels better than Gillette Edge and will last MANY months.

So I think I've gotten it pretty frugal, and that feels great!

I am pretty livid with my car insurance company. I now have the privilege of paying $3000 per year for 3 cars and 3 drivers.

The rates went up when my daughter had an at-fault accident. OK, can't argue that. But then she was rear-ended by some one who wound up leaving the scene. We filed a police report after the fact, and it appears that this is why our insurance got raised AGAIN, even though we made no claim since the damage to the rear bumper was cosmetic and was $500, the deductible. They say that ANY activity such as a police report of an accident counts as "activity", and they can raise our rates. So I told them that this will cause me to shop around, even though previously I had wanted to just stay with them since things had always gone well before.

Honda - Absolutely love them. I've been a loyal customer since 1988. Their cars are just bulletproof and last forever. And when they do make a mistake as in Odyssey transmission failures, they stand behind their product. Automotive nirvana as far as I'm concerned.

Dodge - bought a new 84 in 84, and based on that experience, never again.

Delta Faucets - Mixed - The kitchen one started leaking within a year or two, and I understand their much ballyhooed lifetime warranty is only on the finish. Argghhh. On the other hand the bathroom one is pretty nice.

Price-Pfister faucets - horrible! The handles just fell off and they feel horrible to turn.

Dell - Very good, as long as you buy wisely, i.e get the graphics card and memory slots you need.

Apple - mixed - so far my daughter's Macbook is fine, but her Video iPod died about the day the warranty was up. So far my other daughter's Nano is fine.