Let’s fry some eggs

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In grad school I learned about externalities. Those are the things we might not pay for immediately but all of us pay for in the long run. Like right now it might be cheap to buy a dollar meal at McDonald’s, but in the long run this will play havoc on our individual and collective health care costs. Same with most any industry today. The immediate costs can be low but the costs that society has to bear for the environment, social welfare, and medicine are huge.

Have you ever wondered why it is such a sure bet to go for a career in health care? It’s because we are all so sick. I’m surprised that so few seem to notice this. Health care is a huge part of our economy precisely because we are so sick.

And why are we so sick? Lots of reasons: the industrial food complex, the medical complex that has sold out to big pharma and big food, to our gullibility with the food pyramid. I believe that ultimately we have been sold a bill of goods in the USDA food pyramid that puts grains as the foundation of what we should be eating.

If what I am saying sounds strange, you can start to understand by reading some of Gary Taubes work or watching Cereal Killers.

I am now skipping the grains and flipping the rest of the pyramid. Eating: Fat first. Then protein. Then all the cool carbs like leafy greens, avocados, nuts, and such.

People, we need to think for ourselves and eat like our ancient ancestors did. That’s really not so hard. When you go to a grocery store, skip all the aisles and shop the perimeter. Pretty much everything in produce and meat and eggs is fine. But when you get to the dairy section, skip anything that is touted as low fat and go for full fat.

There’s no price difference between low fat milk and high fat milk. So that’s good. All the way around the grocery store, you can find whole foods. It may be cheaper in the short run to stock up on chips at Aldi’s but in the long run we’ll all be so damn sick.

We already are. But this can change. Drop the crappy carbs. Melt a slab of butter in the skillet and fry yourself some eggs. You will live to tell us about it.

Ladies and Women

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Yes, I do love Dave Ramsey. I listen to his podcasts in any spare moment.  I forgive him for being a gun-toting, government bashing, conservative evangelical dude.  I have lots of friends like that from way back He also is apparently not a racist. I do in fact see in him values here that the left lacks: like loyalty, actually giving to one’s own community (instead of asking the government to do it), and civility (which the left does have and all sides should do more for).

But honest to God I’ve had it with “the ladies.” He never refers to women as women. They are always ladies.

Ramsey has two product for budding entrepreneurs: “entre leadership” for people seriously intent on starting or furthering their own businesses” and “business boutique” ostensibly for women trying to create a new side-hustle.

Okay, fine. But why is it that whenever men call in with a problem about starting a new biz, however much a side hustle,  they are directed to entre leadership and women, no matter how serious their biz, are directed to Christy Wright’s Business Boutique?

And the women are always referred to as ladies?

For christ’s sake, ladies can be women too. They can be serious entrepreneurs. Let’s please, oh please, stop with this sexist shit.

Dave, please…. You’ve got no excuse.

Budgeting for Reality

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Contending with reality, as I faced headlong in my last post, I think I’m off to a good start for July 2018. I’ve got the budget nailed down to the penny, including the big chunk of change for one my loved one to go into treatment plus money for fall college tuition for two kids.

I barely recognize myself — I’ve got money in the bank to pay for things now. I don’t need to put a thing on a credit card. The money is in the bank. I can write a check. What a concept.

Shocking — until now, even though we make a quarter million dollars a year, we never had anything in the bank. It was always a scramble at the start of every month to put as much as possible toward paying off previous months’ — and year’s — debts. So there was nothing much available to pay for the coming month’s expenses.  How stupid is that?

I’ve got two master’s degrees and a PhD  — but somehow I never got a basic education on handling money.

Thankfully now, having woken up,  I am wiser. At the start of the month I set aside what I realistically need for the coming month (mortgage, utilities, food, insurance, car loans, parent load, minimum credit card payment), plus whatever I need to set aside for coming college costs, and only then do I allocate money toward my debt snowball. I then put as much as I can that is left over toward paying off debt. The difference now is that I don’t have to use a credit card for a thing.

Tbis morning, I withdrew $1200 cash from the bank to cover the coming month’s groceries for the family of four and the pocket money for the two of us. I then went shopping for at Aldi where three huge bags of pantry staples that should last the month cost me $42. Okay, not organic, but how amazing is this??? Then I went to the little organic shop to get some specialty things and that cost $35 for five items. I’m going to rethink specialty stuff, like maybe I’ll make my own seitan. Then later I went to the regular grocery store for Peet’s coffee and some other basics I can’t get at Aldi’s, and that cost about $78. I also went to the liquor store and used some of my pocket money to buy a case of wine.

So all told that’s a big outlay for one day, but I’ve found that this is the best way to start the month. There will be fewer runs to the grocery store, more cooking at home, more staying on budget.

And I’m still looking at getting out of credit card debt within one year, paying off car and parent loan by January 2020, and maybe even paying off the house by January 2025.

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Image: Pierre Koenig’s  Case Study House #21

 

Reality and Its Discontents

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It feels like I spend half the day with my head in my hands. It’s getting tough now, friends. I’m not at this moment the chipper cheerleader teaching you how to shop on a budget. I’m now the bedraggled parent trying to figure out how the hell I’m going to do everything I need to do — especially now that it is clear that one kid, a very young adult, needs treatment for major depression and anxiety. Which may mean $28,000 per month.

I’ve applied for financial aid.

I’m not even going to go to what-the-fuck-did-we-do-wrong-to-create-this-mess. As one revered psychoanalyst put it, the child is the symptom of the parents.

That aside, how to handle this? Insurance may cover some — and they should but they won’t cover it all.  I still need to budget for this kid going to college in the fall in case that miraculously works out. And I’ve got another kid starting college. At least they have some sweet financial aid, but still the bill is going to be ten grand a semester for that one, easily 20k for both.

For a moment I thought about just plunking down a credit card on which I’ve got a few tens of thousands of dollars of credit available. But the thought now is so incredibly painful that I’m simply not going to do it. It’s already horrible enough that the current credit card debt has been hovering in the low 80-k’s for a few months. Holy hell, I’m not going to go back to over 100k in credit card debt.

And to make it worse, on my recent travels, I lost my iPAD. Every time I turn around I want it, but it’s not there. And I can’t bear to plunk down nearly a thousand dollars for it and all the accoutrements.

Yes, this is what financial reality looks like. This is the kind of thing I previously avoided in my fantasies about how I made so much money and could just put whatever on a credit card. Now I know we’re broke and can’t have everything. And I feel the pain when what we really terribly need may be out of reach.

Moola and the Mediterranean

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I just returned from another trip, this time to a Mediterranean country: four days in a big city for a meeting followed by ten days in a more remote region where my mother had a hillside house built. (Yes, that’s the view above.) She and my siblings now take care of it and visit when we can. On this trip I focused on getting a local bank account and a way to have the utilities automatically paid from it. That was a huge hassle, but now it’s done. I put $1,000 into the account and my siblings are putting in some as well. We’ve put in so much because the bills had not been paid in a long while. Going forward, I expect the total to be maybe $30 per month total, just $10 each. Given that the house is totally paid for, that’s a pretty sweet deal.

I just added up how much I spent on that trip, aside from that $1,000, and also apart from the big airfare and hotel covered by my research account: $775 for other travel costs (including a short plane trip and a rental car for ten days), an extra $120 for the hotel in the big city (since I’ve now exhausted my research account for the academic year), and $537 that I used to buy groceries, eat out, and pick up a couple of small things, including one hat to ward off the sun. (Oh, holy hell, did that hat violate my year of no shopping? Can I just say that it was a cosmetic necessity?)

I am actually quite amazed that I only spent $537 on this and that over 14 days — which included a handful of extraordinarily delicious meals out and the costs for making several meals in for family and friends. This was no accident. At every moment I was super-conscious of my spending, including at the grocery store. And except for that hat, I was religious about my year of no shopping. No matter how I bemoaned not having packed adequately, I did not shop for any clothes, jewelry, shoes, or bags. I walked right by every kiosk selling local jewelry, I ignored the shoe stores. I lived with what I had.

The whole trip did slow my debt reduction process, but at least (forgive my rationalizing) I can write off the expenses since a good deal of them were work related, including the meeting in the big city and meeting with a couple of colleagues in the remote area.

I am also taking care of that house. In the past I might have ignored the need to take care of the utilities and set up a local bank account, but now I’m hyper-focused. This is all not just about paying off debt but about taking full responsibility for my life. And, yes, it’s a very nice life.

Where was that millionaire’s manual?

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I peered over my youngest child’s shoulder as she opened a financial aid letter from the private college she’ll be attending in the fall. It was a notice about the student loan offer that was part of her financial aid package. (There’s an oxymoron.) “No, we’re not doing that,” I said to her. “But then,” she asked, “how will we afford my college?” “I’m saving our pennies,” I said. “You are not going into debt.”

My oldest had already accrued some debt before I woke up to our financial nightmare and started getting it together. I’ll pay that at the end of the line, after cash flowing both their college costs, paying off all our credit card debt and car loans. Then there will still be the HELOC and the mortgage. Still, we should be totally debt free in a little over five years.

Yep, I’m hell bent on living on a budget, paying cash for college, and paying off the nearly $662,000 in debt we accrued over the years.

I can’t believe how stupid my fella and I had been. As I’ve written, two decades ago we inherited a million bucks. An inheritance like that should come with an owner’s manual. It would include tips like these:

  • Put the money in mutual funds.
  • Don’t touch the principle except to buy real estate.
  • So don’t take out a mortgage.
  • Live on your income, not the proceeds from the investment, much less the principle.
  • In fact, live on a budget so you can still add to your investments.
  • And don’t borrow a dime.

Well, there was no manual, but we should have had enough sense to seek out some good advice. Fortunately, we did roll over a good amount into some IRAs so we weren’t left with nothing after all our stupidity.

As Dave Ramsey says, now’s the time to stop looking in the rear view window and start look ahead. It’s going to be fine.  I found me some sense before it was too late. I’ve written my own manual. If all goes well, we’ll get back that million and then some.

 

En Route…

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Greetings from another airline club, a leftover perk from my pre-austerity days. I am heading to a small eastern European country for a conference. In order protect my secret identity I can’t tell you where. Suffice it to say that the cost of a meal out is about the cost of a New York diner. That should narrow things down.

At this point in my academic year, with all the traveling I’ve been doing, I’ve got less than $1500 left in my research account. And I’ve got this European trip and one more. Airfare is already covered, so that leaves hotel, food, and taxis.  In years past, I wouldn’t blink an eye and just say, well, whatever exceeds funds can be a tax write off. I have tax-written-off expenses to the tune of tens of thousands of dollars. Good-bye to that rationalization.

So for this trip I have budgeted $280 of my own money for a week of inside the city travel and meals. Even though it’s a work trip, I’ve used miles to make the most of my diminishing research budget, which can still cover my lodging. That lodging includes a lovely breakfast which is oh so much better than what is billed as a “continental breakfast” in the United States. American hotel goers, rise up in discontent over that sad bowl of pastries! Maybe I’ll snap a pic and share.

So, yes, I’m traveling for a week in Europe on just $280 of my own money, which I will deduct from my taxes as a business expense, but not a dime more. Instead of hailing Ubers, I plan on walking a lot. Instead of picking up the tab for my colleagues, I’m going to order modestly and pay just my part. I’m going to make use of the local markets to keep food in my fridge for mid-day and late-night snacks, including maybe some cheap eastern european wine.

I am hoarding the rest of my research funds for my next trip in June to another European country, this time on the Mediterranean. More on that later.

P.S. So that the family would not go crazy in my absence by shopping at Whole Foods, I cooked ahead and bought cheap stuff with meal plans tacked to the fridge. I thought of installing a secret camera to spy on them but ran out of time.