Book In Progress: All The Money In The World

After finishing “Your Money Or Your Life” (YMOYL), I felt the need to continue my mental shift toward money and decided to read All The Money In The World by Laura Vanderkam.  The author herself was kind enough to email me a PDF of the book despite knowing that I jot down my ongoing thoughts rather than write a full review.  Note to self: I would like to write a wrap-up of my thoughts on YMOYL but that may not be happening soon, or ever!

Here are my random thoughts after reading the first few chapters.

I like her clear, concise writing style.  ”Your Money or Your Life” felt more warm and fuzzy; the tone of this book is more like your most practical best friend.

Chapter 1 “What Else Can That Wedding Ring Buy?” – The author  uses the cost of a wedding ring as a springboard to discuss “opportunity costs”‘; in other words, what can you do with the same amount of money.  Is it more worth while to buy a $5,000 ring but can’t afford cleaning help or date nights when you have kids years later?  Obviously some people can do both, but as someone who is now carefully watching household expenses after kids,  I’m 100% sure that the wiser decision for us was to skip the diamond ring and have the money to get cleaning and nanny/babysitter help!

Chapter 2 “Don’t Scrimp More, Make More” – The main point of this chapter is to illustrate how you can make a bigger difference in your quality of life if you focus on making more money instead of scrimping every penny.  I generally agree, however with huge caveats.    I think go-getters and people who have ”succeeded” often make the assumption that savers have less ambition; if they would only build up their skill set, they could make more money instead of clipping coupons and cutting cable, etc..  While I can see the reason for that assumption, I also think that it’s not the complete picture.  I have good friends in both camps — those who are more natural go-getters/entrepreneurial and those who are not.  While both can have similar educational backgrounds, go-getters are usually more skilled at two very socially-valuable skills: networking and selling themselves.  Time and time again, I see my go-getter friends succeed while the others lose out on jobs, deals, etc… Does this mean you shouldn’t try if you’re not a natural at these socially-valued skills? Of course not. It is very possible to greatly improve at these skills and it is possible to compete and “win” since a variety of factors also come into play in any given situation.

For those who succeeded or are more entrepreneurial, it’s hard to imagine why anyone would “waste time” and scrimp through life.  What I think gets forgotten is that it gets extremely disheartening to be second-choice or third-choice. After a certain number of years, it’s better (for some people) to focus on other things besides job/career/money success and focus on saving money, even it is doing something as mundane as coupon clipping (!) And while I still can’t imagine going to extremes for couponing, saving money is something within everyone’s control and hence more appealing to many.

I do have a tip to add for those who lean towards scrimping. Learn to negotiate!  Negotiate your salary is most important but you can also save when you shop, buy a house, buy a car, on cable bills, on medical expenses, etc.. Doing this often and doing this well will make a bigger difference than cutting coupons.

This book can be helpful to many but I think it’s most useful for those in their 20s/30s with entrepreneurial leanings.  If you find ways to make more money and be smarter with your financial resources, you’ll go a long way and the sooner you learn those lessons the better!

Back to reading…

Random Bits Of Good Advice

By the time you’re 40ish, or been around long enough, you’ve been on the receiving end of tons of advice — some good, some not so good or at least not applicable to your life.  I thought that I would compile some of the best advice I’ve ever heard.  Maybe you’ll gain something from these “words of wisdom” too.

• “Never get into credit card debt” – My Mom, delivered in such a severe and foreboding tone that I didn’t even ask her why and I never racked up any debt)
• “If your kids fall or bump into something and you know they’re not hurt, just distract them.  ” – Male co-worker.  This tactic also works if they’re fighting over toys or cry for no reason.  You can distract them with funny faces, loud noises or other shiny toys.
• “You can only change your reaction to people.”  – A friend, after hearing me complain one too many times about the same people.
• “Money buys freedom.” – I can’t remember who said this but I think it was a rock musician. 
• “Don’t lean back ahead of time“ – Wandering Scientist, who has written a million good posts about balancing work and motherhood.  Lots of practical tips as well as thoughful posts.  I’ve written about this too and the most important thing is to not feel guilty.
• “Forget balance. Choose Flexibility” – The Happiest Mom blog. This is good advice for anyone with interests outside of work.
• “If someone tries to abduct you, fight back and don’t let them take you away to an isolated place.” – High school teacher, to the whole class.  This stuck with me because it had no context in terms of the school subject.  This teacher was also male and he was so sincere and heartfelt that it made me take more notice for some reason.  I now wonder if he experienced any personal tragedy.
• If you only have a few minutes to clean before guests arrive, clean the bathroom (clean toilet, wipe sink, quick sweep of the floors).  Drop an Alka Seltzer in the toilet bowl.” – Probably a Martha Stewart or Real Simple magazine tip, i.e. clean what people will notice most.
• “To find a good, affordable restaurant in a foreign country, take a peek inside and see if most of the customers are local.  If yes, it’s a good bet the food is authentic and reasonably priced.” — Rick Steves, of the PBS travel series.  That’s not an exact quote but I followed this advice in Europe and it really made a difference in my travel experiences.
• “Focus on your strengths.” I forget where I read this but as someone who tend to focus on improving my weaknesses, this was a bit of a revelation.  While I do continually try to improve myself, I do my best work when I take on projects that play to my strengths.
• “Rock your baby up and down with energy, like this.” – A Nurse, who showed us that many babies prefer a vigorous up-and-down rocking motion rather than the gentle back-and-forth motion.  It sounds strange and sometimes it felt like our babies were hanging on for dear life, but it worked!

Advice is a funny thing. After I wrote down the above list, I realized that most of the advice I take to heart come from strangers or acquaintances (blogs, books, famous people), not people I’m close to in real life.  I don’t know if that’s common or if I’m more dismissive of advice I hear from family and friends, or if most advice given are nothing more than well-meaning clichés. 

Another thing about advice is that timing comes into play.  Sometimes two people can give you the exact same advice, phrased differently, and you just don’t pay attention until you’re ready to hear it.

What are some unforgettable, and good, advice you’ve received or read somewhere?

YMOYL: I Hate Charts

I’ve been sharing my general impressions of “Your Money Or Your Life” (YMOYL) on my journey as a book club of one.  Part of me feels like I should have started the online book club but I would not have been as thorough as minhus and a bout of flu would have killed any enthusiasm.  And as you can see from my distaste for doing the actual exercises, I can’t lead a club if I am doing the minimum to get through the book! 

As I mentioned earlier, I did finally come up with my real wage.  According to YMOYL, this is your hourly income AFTER you add in your commuting time and subtract all work-related expenses from childcare to work wardrobe to lunches.  I think my number is on the low side but I’m sticking to it for now and using that as a mental yardstick to rein in my purchases.  This is working so far and I highly recommend this step!

In Chapter 5, you’re also supposed to figure out your monthly income and expenses, then create an awesome chart so that you can have a visual reminder of your spending habits.  I haven’t take the step of tracking my real-world expenses.  However, I did an estimate which takes my gross income minus health insurance, taxes, and regular monthly expenses.  I looked at my previous year’s expenses for auto insurance, auto repairs and renter’s insurance and divided it by 12 to come up with a monthly amount.  End result: I have a $300 buffer each month.

It’s a bit of a relief to know that I even have a buffer.  At the same time, I’m not sure how/why we have a buffer considering that a few years ago, I estimated that we had about $100 left over after expenses.  Since then, expenses have generally gone up while wages have been stagnant.

Possible reasons for this mysterious buffer are:

• Grossly under-estimated expenses: In other words, I really should track expenses.
• Lower taxes due to child credits? 
• Lower bills for cable, DSL and phones: I re-negotiate expenses all the time but this year, I was able to really trim these bills by reducing cable channels and getting $40-50/month discount off my DSL/phone.  Most years, the rep offers a $5 – $10 discount if I threaten to cancel.  As I learned this year, the offer can vary greatly depending on timing and the customer service representative you talk to!

I may have to suck it up and chart expenses and/or go over old credit card statements to get more accurate numbers.  Part of me thinks that this buffer is real. I included as many variable expenses as possible from gifts to auto insurance.  I also estimated on the higher side for stuff like household goods and toiletries.    However, nothing beats a real estimate based on actual tracking of expenses!

Your Money Or Your Life: Stuck on Chapter 4

Chapter 4 of “Your Money or Your Life” focuses on fulfillment.  The questions asked are:

1. What did you want to be when you grow up?
2. What have you always wanted to do that you haven’t done yet?
3. What have you done in your life that you’re really proud of?
4. If you knew you were going to die in a year, how would you spend that year?
5. What brings your the most fulfillment – and how is that related to money?
6. If you didn’t have to work for a living, what would you do with your time?

I am stuck. I have no answers or rather my answers change depending on my day and mood.  I think one of the big problems is that my proudest accomplishments are related to my current line of work, yet I’m not sure that I want to be in this job or field for the rest of my life.

With this in mind, here’s my attempt at answering those questions:

1. I wanted to be a dancer at some point but I can’t dance well.
2. Don’t know.
3. All related to my work, or just that fact that I had kids.
4.  Travel, or live in a foreign land for a year.
5. I love living in foreign places and getting to know a city or place. I love learning new things and challenging my mind.  I also find it very fulfilling when I help other people even if it’s simply giving advice or support in an online forum.
6. I would live in a beautiful natural environment, work in a garden, exercise, eat well, spend time with my family, and read / write blogs.  I would do something to make a difference…not sure what.

I have no idea how these answers can shape my life.  Maybe it’s because I skipped some exercises in earlier chapters?  Help…

Although this wasn’t addressed, I do want a somewhat comfortable life.  Everyone’s definition of comfort is different.  For me, that means money in the bank to take care of emergencies, fly and visit family members, take care of my family’s health from braces to major medical care, get cleaning help sometimes, and to buy some pretty clothes every so often.

I also don’t want to be too dependent on the kindness of others.  At least among my friends and family, I’ve often noticed that the poorest members get tons of hand-outs from small favors to plane tickets.   I’m sure others are glad to help but I would worry that my livelihood is dependent upon someone else having to work the grind so to speak.  (If I am ever in that situation, I would make sure to return the favor in other ways via my time but so many people just seem to get used to receiving and not giving help, in my opinion).

So the bigger question is what is enough?

My Money Or My Life

At the advice of Grumpy Rumblings and Consciously Frugal, I decided to dig into “Your Money Or Your Life”, a best-selling personal finance book.   It was first published in the 1990s but was updated in recent years.   This is not a review, as I’m still on Chapter Three, but knowing that I would never write down a full thought-out review, I thought I would jot down my general impressions.

I’m sure that I read a review that mentions the book’s focus on the environmental consequences of our consumer culture.   I’m not sure if these sections would turn some people off, some who would benefit from the ultimate message. 

There are lots of tasks to do! The book asks you to go through your lifetime earnings and then list your current assets. In other words, what do you have to show for all your hard work?

I’ve been surprised that I’m learning new things, because I’ve read summaries of this book before and thought that was all there is to it.  I guess just as cliff notes are never substitutes for a literary classic, reviews can’t cover everything that is in the book. Plus, it’s very helpful to have messages repeated for some people (like me!). 

I would like to do the exercise of tracking down every expense, but I know my husband won’t be likely to do this and I’m not sure it’s very helpful if only I do this.

I was about to purchase two shirts from Land’s End Canvas (One day only sale!) but I stopped myself. While I could use two blouses for summer and these would be good for weekend and work, I didn’t need it right now.  Plus, I am sure I can find a better deal than $29 per shirt if I really wait for sales, or I may discover that I don’t need any at all or just one.   Changing old habits are tough. I’m not a big shopper but I’m more susceptible to limited time sales/deals and pretty things than I like to admit.

Anyway, I’ll keep posting as I move along on my little personal finance journey…

A Precarious Balance

I’ve been thinking a lot again about work/life balance because of Working Mother magazine.  A recent issue profiled an MD, a supervisor and a high-power executive at a tech company about their work-life struggles.  In general all their articles profile women in higher-income brackets, probably due to the demographics of their readers and the general assumption is that if these women can do it, people with more regular schedules can, too. 

While I enjoy reading about these high-powered women and also about freelance WOHM moms, I feel that the majority of media ignores those truly in the middle-class (and lower middle-class).   We don’t enjoy the kind of flexibility that higher-powered women enjoy and we can’t delegate away chores like those with financial advantages. 

At my company, those in manager positions and above enjoy a higher autonomy.   They don’t have to ask permission to work from home.  They also have the money for nanny and cleaning help, something that my household has paid for but at a great sacrifice (and only temporarily).   They can still enjoy many luxuries like massages, travel and dining out.  True, they have greater responsibilities, too, and they’ve earned it.  But their solutions often aren’t applicable to those those in lower income brackets.  In other words, they can buy some balance while many people don’t have that same privilege.

That’s why I’m sharing my thoughts now, as a non-manager making a middle-class salary in a high cost of living area.  Like many average working people, I don’t enjoy the flexibility of working from home or part-time hours, both of which I truly crave, so I make the best of my situation.  Before I delve into my tips, I must say that we manage OK because my husband does have a flexible schedule and we have nearby parental help.   The third part of the equation is flexibility at work, something that is within my control to a degree.  

1. Earn Your Stripes:  What do I mean by this? I mean that before having kids, you should build a solid work reputation and prove your value to your boss, so that he/she trusts you to do your job without constant monitoring.  If your boss values you, there is a greater forgiveness factor when you have kids and your finely balanced life is thrown off-kilter.  There’s a chance that you’ll manage to keep your career almost on track or entirely on track if you’re a true superstar and that you’ll still get just enough family time to keep sane and happy.   I have managed to “earn my stripes” so to speak at my current company and with my current boss. Although I am sure that he’s not happy about my increased absences, he and my co-workers have been super supportive because I still finish my projects on-time.  Plus,  I have a reputation for being efficient, productive and supportive of others. 
2. Learn to read your boss: Every boss is different. I’ve had bosses who valued creativity; one who valued initiative; another that valued anticipating his/her needs.  If you can make yourself invaluable in ways that matter most to your boss, you’ll be more appreciated.   This sounds like simple advice but I’ve seen many employees who focus mostly on what they want to do, without thinking about company goals or what makes their boss’s life easier.
3. Take certain projects off your boss’s plate:  With Tip #2 in mind, If you have a strong skill where your boss is lacking, try taking that project off his/her plate.  For example if your boss hates to write, offer to do more writing-related projects. Same for reporting or spreadsheets or presentations.  Ideally your strengths are his/her weaknesses.
4. Take longer lunches:  Because I’m a trusted team member, my boss doesn’t watch my comings and goings like a hawk.  I appreciate this and I don’t take advantage.  On most days, I actually take shorter lunches and when it’s super busy, I eat at my desk.  However, if it’s a slow day, I can run errands and eat lunch in a little over an hour. Having that flexibility to get bigger chores out of the way allows me to have more free time during non-work hours.
5. Just plain dumb luck:  You can work really hard but your boss just thinks that everyone is a robot and can put in 110% with no risk of burn-out.  I’ve been fortunate to have many good bosses.  I’ve also been “fortunate” that for various reasons, my co-workers have had work/balance issues, too, so that the spotlight isn’t on me, the dreaded working mom of young kids (!).

I’m glad that I have this flexibility and while my life often feels unbalanced, this flexibility allows me to plow forward and enjoy parenthood without guilt. 

Here are more interesting thoughts on the work/life balance:

http://thehappiestmom.com/2009/05/balance-vs-flexibility/

http://www.wandering-scientist.com/2012/02/no-ones-gonna-stop-me-from-having-it.html

Laura  Vanderkam wrote a book about time management and while I haven’t read it, I was struck by the negative reviews on Amazon.com — basically her advice was mostly applicable to those with money and only certain types of careers like writing:  http://www.amazon.com/168-Hours-Have-More-Think/dp/B0043RT8EU/ref=sr_1_1?ie=UTF8&qid=1329869680&sr=8-1

How do you manage the work/life balance? Do you have flexibility? I’m especially curious to hear from those in non-management level jobs who don’t have the funds to delegate away chores and errands!

Time Envy

For someone who has only occasional envy issues with the mythical wealthy Jones family (i.e. keeping up with the Joneses), I do get jealous of family and friends more often than I like to admit.  I wish I could offer a solution (i.e. how to overcome envy in 10 easy steps) but I’m not quite there yet and not in any position to dispense advice.  I do know that long-term envy is not healthy for me or anyone, period.  No wonder it’s one of the seven deadly sins!  

My envy is very specific.  It’s rarely about money. Although I do want more money sometimes, I realize that most people that earn more also work at more stressful jobs than I do.  It’s hard to manage employees and answer to demanding higher-ups.  The trade-off is not worth it for me.   For me, envy rears its head when I think about people with more free time.   

Strangely, my envy is usually directed at my stay-at-home mom friends.  I  say “strangely” because I’m not under any illusion that staying at home is easy or relaxing.  No one I know well has a trust fund or are stay-at-home and childless, two groups which probably really deserve anyone’s envy.

So right now, my envy is directed at those who have quit the rat race, especially those with school age children.  While I know it’s still work and there’s a house to keep clean on top of everything else, these friends seem to have more time to work out, read books or just visit the zoo on an uncrowded day!  And if life is anything like those depicted on mom blogs, home life is 50% crazy (kid eats crayons or throws tantrums) but also 50% slower. 

I fully understand that a slower pace isn’t all fun and games.   A lot of that time is spent managing a household from laundry to doctor appointments to cooking 2-3 meals a day.  However,  I also get the sense that their time is less hectic overall (again, with the caveat that this is my perception once their kids or at least one kid is in school).  When you stay home, you’re the master of your own time.  You don’t often have deadline-oriented projects.  You’re not bombarded with requests and questions via emails and instant messages.   You have time to just move at your own pace.

It’s important to note that I’m not dismissing homelife as anything less, just because it’s not as busy as work life.  Obviously taking care of children is important. ( I also do not say ‘raising children’ because I believe both working and non-working parents raise their children.)  However, I think that our society has placed such importance on busy-ness that even stay-at-home spouses have to say that they’re as busy as everyone else.  I don’t know many SAHMs who would say that they have more time than those working, so my theory is based on reading blogs and personal observation.  When I’m off on weekdays, I run into calm-looking moms strolling through malls with their kids and friends.  They have downtime to smell the roses, so to speak.   I suppose that’s the benefit of not having to cram errands in between a commute and deadlines?

These feelings of envy are often followed by guilt. I know I shouldn’t feel this way and just be happy for others.  I also know that doing endless loads of laundry and household chores would make me very unhappy!

On a personal note, I’m dealing with my time envy in a few ways.  I think it was a suggestion from Tragic Sandwich but I’m trying to take at least one vacation day per month.  If I remember correctly, she uses it for organizing but I’m not that virtuous.  However, that one extra day allows me to stretch out my time and work at my own slower pace.  I’m able to get things off my to-do list and also find time for exercise and just playtime.

That’s not to say I’m not still enjoying parenthood overall.  I love watching my kids play (they’re quite close in age) and letting them discover their own games like peek-a-boo and “let’s-roll-over-on-each-other-and-laugh” plus the usual bickering and bopping each other on the head. 

Is my impression of staying home completely unrealistic or is there a grain of truth?  Do you envy those with more money or more time?