My Final Post

Going into school, my net worth has dipped -4% to $42,305. Did not meet my goal, but not abysmal. I officially gave up $4,000 in unvested retirement savings and $80,000 in tuition credit to make what I feel confident is the right decision for my future to move out of the Midwest and follow a better career progression. I feel lucky I can be this financially foolish.

But at this point in my life, I have to cling to the adage for business school students everywhere: It’s about the time, not the money.

That is definitely how I feel and I’m ready to plunge headlong into this next two years of TIME. The money will come. I’ve decided that although I will keep up with my monthly budget and net worth check-in’s privately, I will not continue to publish them here on this blog. I’m officially going dormant – potentially for a full two years. I hope to resume after I’m done and reinstated into the real world – either here or at another name.

I have absolutely loved this experience and thanks to all of you who commented – publicly and privately. I have been so enriched by you.

Checking Back in on 2009 Annual Goals...

Wow, the end of July, really? We’re there. Thought it would be a good time to reflect upon the annual goals I set, way back when. Given the turn we’ve taken with the economy and the level of uncertainty, combined with my decision to walk away from business school sponsorship and take on debt to go back to grad school….. I haven’t made much progress.

Financial:
1 – Get to three-months of expenses in my emergency fund. (ALMOST)
2 – Once we get a dog, transfer all automatic savings over to grad-school and wedding-funds, split evently – save $2000 in total towards these goals. (NOPE)
3 – Become a loan expert and secure a great loan package for grad school. (YES!)
4 – Stretch: Max out 2008 Roth by April deadline (KNEW THIS WOULDN’T HAPPEN EARLY ON)


It makes me feel like I haven’t gotten a lot done. And yet, different goals and items to manage come up, and there are lots of ways to stay productive. Overall my net worth is moving up – and not too much further to go to reach my goal, so I feel good about that!

Gregg Easterbrook's: The Progress Paradox

Subtitle: How Life Gets Better While People Feel Worse

Highly Skimmable. The best four lines in the book that kind of say it all: “Portable carpeted dog steps” – These are the things that make us unhappy – the blur of needs and wants caused by rampant materialism.

The major causes of WHY people feel worse while life gets better:

1.The unsettled, nonlinear character of progress: while things do get better, there are stops and starts. While healthcare is improving, we still have the AIDS epidemics, etc.

2.Fundraising only happens at the extremes. Politicians couldn’t get very much money out of you if they represented inevitable progress. When right-wing personalities claim that Democrats are ruining the world, and vice versa, they’re doing so as a means to coax funding from your wallet.

3.Crises raise the self-importance of the elite (and boost ratings) - and thus, the elite generate their own crises.

The one thing I didn’t like about this book was the lack of solutions or constructive thinking about how to reverse the trend. The one theme that seems to recur in all of these happiness tomes (I’ve read quite a few) is referent anxiety (i.e. keeping up with the Jones’s). There’s a great deal of debate about referent anxiety and costs and benefits to society. For example, there is less referent anxiety in a stagnant economy – but one would argue this isn’t necessarily advantageous to a country’s citizens. Easterbrook’s main example was that of Scandinavian countries, whose “socialism-lite governments have moved everyone to middle class – something vaguely like a society in which everyone has a 3BR and a Honda accord”. Sign me up?

Health Care Costs Ex-Insurance

At the beginning of this year, I decided to keep a running list of what I would have to pay for all of my health-care-related expenses if I didn’t have insurance. That’s the retail sticker price. So far, the tally has been pretty enlightening, as itemized below... the biggest expense was actual my very generic Rx.

Retail for my Generic Rx $59.99 x 12 months = $719.88
OverTheCounter Meds = $42
Contacts = $114
Annual OB/GYN visit = $180
Dermatology Screening *EST* $175
Dermatology – Routine Removal *EST* $450
Dental Exam - *EST* $150
Dental Cleaning - *EST* $140
TOTAL Year To-Date: Closing in on ~ $2000

Blogging for the Sake of Learning (and/or Getting a Job?)

Thinking even more about giving up the blog, I realize that I do still LOVE and believe in the idea of devoting significant time to a public forum to house thoughts, reflections, and more than anything a slow climbing path towards being an expert on some discrete finite topic. It is very much in line with Malcolm Gladwell’s ideas in Outliers on effort – similar to the "10,000 hour rule" espoused by a lot of writers at the New Yorker and various publications.

You can only become truly knowledgeable… or, phrased more positively….. you can actually become an EXPERT with just really hard work and time in front of you. Which provokes me to ask myself, what do I really want to perfect within myself? What could I become an expert in, and where could I develop myself through practice and effort and time?

I’ve had so many side interests – while I love writing and want to maintain that with a certain level of ferocity, I find that too private to actually blog about. I started getting really interested in wine and really would love to take advantage of opportunities to learn more. I have a good start on a tracker of my tasting notes… but then, I would post on that more sporadically, and there are SO many wine blogs out there, that mine would be, once again, the least knowledgeable and interesting voice out there!

I COULD use it as a professional opportunity to start practicing for case interviews, since I've determined I may want to break into management consulting after grad school. A case interview a day! That actually has the potential to create a real following, based on the lack of real, free resources or forums out there. Another sort of more general business school blog could be lumped into that as well – which would actually be FUN to maintain.

I think we’ve got some changes afoot....

Collisions in Twittering and Blogging

True, Suze Orman is the only personal finance guru/resource I’ve been following on twitter, so I can’t say that I have an exhaustive perspective on this, but I am scrolling TweetDeck on my phone often enough to concur with much of the media that nothing much insightful or thought-provoking gets written about on twitter. Even Suze is reduced to chatting it up about Michael Jackson and Sarah Palin.

It is really difficult to find anything that is actually value-added in any of these 140 characters (times 140 updates per day).

(Full Disclosure: I do have a twitter account under my real name, and I strive to post things that are interesting and value-added and truly undiscoverable by any other forum or unknowable to my friends through any other way. But I mostly fail as evidenced by last 5 tweets:
1.A picture of cupcakes I baked for the 4th of July
2.My disappointment that I didn’t get the house I wanted in Palo Alto
3.Excitement over attending an Indian wedding
4.Disappointment at the ultimate winner of the last season of Biggest Loser couples
5.My mixed emotions over the yuppiedom of owning those little metallic spice racks)

Then again, when I scroll my Google Reader for the latest on personal finance blogs, I truly am – scrolling. I can get the gist of most posts and updates in a few lines, and then I’m on to the next thing.

Which leads me to conclude…. As I go back to school and have less and less relevant topics to post on related to personal finance, would twitter be a better forum for my pf thoughts and insights???

Lately, I’ve been doing quite a bit of muddling over the state of the blog and the worthiness of keeping this up. The background updates and tracking I’ve done as a result are hugely value-added to me, and I don’t want to lose that. But perhaps I can distill the minimal value I create for others into a 140 character update.

I think I’ll tweet about it….

24 Hour Trip to NY for $150

Heading to New York to see friends this weekend for literally, only 24 hours. And I’ve set a budget for myself of $150. How could I do that much damage in that little amount of time, right? My hotel was through a free night award, so I’m good there – and planning to pack plenty of breakfast-y snacks for my plane ride in. So the only things I am really talking about are:

2 cab rides into/out of the city, plus a metrocard refill: $50
Saturday drinks with Gals: $15
Saturday drinks with another friend: $20
Dinner/Drinks on our planned excursion out to the new Citi field (tickets comped by my friend): $65

I’ll report back later… probably, on where I went wrong!

Oh, the Bonus Money Dilemma

Was running around the lake with the Guy the other day when he brought up the subject of “what he was going to buy with his bonus money.” Oh, what luxury. Oh, what eye rolling. The Guy makes twice as much money as I do. He owns his place (where I also live, at a significantly subsidized rate), has a reasonable mortgage, and we live a modest lifestyle (thanks mostly to my influence).

Clearly, his question galled me, just a bit. But when I asked him all of the basic saving questions, he had decent answers, and it was clear that he felt pretty safe in his financial condition, despite the chaos around us. He has a four month emergency fund, he has some $60K in investments towards future goals of either starting a business and/or downpayment for a house. Basically he has a remote idea of those goals, and a remote idea of what they could cost, but those are not itemized and he’s not tracking his progress toward them, because: 1) he feels comfortable and 2) these goals are far off.

After reflecting – long after we completed our run – the whole episode just reinforced to me the importance and need for having a detailed financial plan and continually checking-in on where you are. Even though it can be frustrating and discouraging at times, it helps to guide your decision-making in almost every situation, from should I go out for dinner tonight to when should I retire… from where should I put my next $1 to where should I put my next $15,000.

Our whole discussion if of course, quite illustrative of lifestyle inflation as well. The Guy was in part distressed because everyone else around him was making a big purchase or at least saving towards a big purchase, and he has no need for any big purchases at the moment! What a world we live in!

It also made me realize how excited I will be to reset my financial goals post-B-school – when I actually have a higher income and more resources, and when the Guy and I will likely be combining our finances to work towards these things together!

End of Employment Money Wrap-Up

As I wrap up at my current employer and get ready to head back to school, I’m having to learn a lot about the loose ends of my finances as well. I’m rolling over my current 401(k) into a Traditional IRA account – which will be taking a considerable hit, given that I’m giving up the unvested portion (which is currently $5,068) – and thus setting the foundation for all future company retirement plans that I might begin and rollover.

Also, I had 10 random shares of company stocks that were given to me as an award. (As of today, worth somewhere between $580 - $600). I’ve had to go through multiple calls with company HR representatives to have them tell me that I need to contact the designated Shareholder Services company to actually set up an account before I could do anything else. Conceivably, because I don’t have a broker I could hand them off to? Anyway, all of this made me realize just how easy it is to have money lost out there in the ether.

I’m very tempted to cash out the 10 shares completely, so that:
#1) I won’t have random unaccounted company shares hanging out there
#2) the stock is pretty high vs. where we’ve been tracking the past few years, so I’m not convinced keeping my money there is going to provide some hefty return, and
#3) so that I can partially fund the purchase of a new computer for business school without jacking my student loan bill any higher.

All very tempting rationales…. More to come on this!

Does it Ever End? More July Goals

When I think about the personal value I get out of this blog and the personal drive and energy it adds to my life, one of the most important things is public goal-setting. I realize they’ve taken up a larger share of the posts….. but so, be it. One of my best tactics of late is to get more aggressive about setting goals for different time horizons. So in addition to my main savings goal from yesterday, here are my new July Goals.

Daily Goals
Read a minimum of 5 articles in the WSJ (or equivalent) each day.

Weekly Goals (4 of these, 1 for each week)
Read and log notes about Portuguese wines.
Finish reading all of my library books and return them.
Re-read my novel and stories and write a planned writing schedule for August.
Pick up boxes and pack up all books; also make a total packing list.

Monthly Goals
Complete the rest of my 5K Training schedule and find a race in Palo Alto to run.
Complete all B-School prep required (mainly Accounting and Finance workbooks).

Reflecting back on June

NetWorth up to $43,971! +4% from last month, on the strength of my company stock price, and tiny bumps in my retirement fund. I guess I haven’t done so horribly this month – especially given the fact that I made TWO major purchases this month – the IPhone 3GS and a new Schwinn Hybrid from Costco. When I reflect back on my June goals, I feel like I was able to accomplish quite a fair amount, in every single category of my life except for my finances. What I didn’t do this month was to fully fund my ING Savings, so my liquid emergency fund has remained pretty stagnant at this point.

I finished planning the OutWest Roadtrip, Completed 3 weeks of training for a 5K, and brought a good deal more joy into my life… But I did NOT fully fund my ING Savings account (which is putting in my $450 a month contribution).

Not to get myself too down, my #1 July goal is to not only fully fund my ING account the usual $450, but to bump it up another $400 as well. Hopefully my impending month of unemployment will help catalyze me all the way there. The major cuts in spending are going to be coming from clothing (no major purchases), alcohol (I will not enter our premium wine store, nor will I allow the Guy in there… we are drinking what we have!), gas (just filled up my tank at the end of this month + carpooling) and entertainment (my home made fun this month will be packing up our stuff!)

June Books

Continuing on my Friedman kick, I read The World is Flat, which was another very insightful, albeit skimmable tome. Similar to last time, for me, it was worth reading for just a few valuable sentences and concepts

One.
The reminder that despite the repetition of the pundits, that al-Qaeda is not a religious fundamentalist group, but rather a phenomenon of political extremism. They do not focus on communication and interaction with their god at all. Rather, the focus is on a totalitarian utopian skewed vision of a kingdom on earth – i.e. an Islamic state that rules the land.

Two.
I found the connection between terrorism and humiliation quite profound: “Humiliation is the most underestimated force in international relations and in human relations.” After emphasizing the possibility for hope of economic development and financial elements of the flattening world, it was an excellent counterbalance to talk about the ways terrorism… is spawned by the poverty of dignity (not money).

Up next is Malcolm Gladwell’s Outliers, oh, and I’m reading Ted Hughes’ Birthday Letters right before I fall asleep each night. Reminds me how much I miss reading poetry.

Interesting A-Ha's about COBRA

Couple new fun facts I learned about COBRA, in case you’re leaving a company soon… either by choice or not so much by choice.

1.My healthcare benefits are terminated on the last day of the month in which I terminate my employment. I was originally thinking about my last day at work being July 31st, but then I realized that if I worked one more day (August 3rd), I would then have healthcare for the remainder of August. (This was relevant to my Blue Cross Blue Shield healthplan, and I’m definitely not sure that this applies everywhere).

2.The second item does apply everywhere because it’s new legislation just implemented by Obama. Apparently, you can elect COBRA retroactively, up to two months after you terminate employment. So, I can basically not pay for healthcare for the month of August… but if I break my leg, I can go to the hospital and say “I need to elect COBRA to pay for this!” The whole impetus behind the new legislation is making coverage easier for people that are in transition. Awesome, real world implications benefitting me from having all of that hope in the Oval Office.

Vortex of Tide Detergent Choices

People have written about this before, and I know I’m not offering anything too novel here, but I was at the grocery store the other night, in a hurry and very eager to end the shopping trip, when I was remembered the last item on my list – laundry detergent. I have been a loyal Tide shopper as long as I can remember. My parents bought Tide. I buy Tide, even when I was in college. It’s not the most economical brand to buy, but I’m no laundry expert, and it just feels like something you don’t want to mess up with buying cheap – you could end up altering your clothes (far more expensive than the investment in good detergent). But last night, I was overwhelmed with a SEA of tide. Choices in size, scent, cause, intended use – front loaders, high efficiency machines. I was so frustrated. Not least of all was the difficulty to understand the true price/value of their product. So many different price points, with so many different variables left me blind to what was causing one container to be more expensive than another. While I might pay more for the larger size, I am not going to pay more for the scent of Febreze. I was so frustrated, I picked up a very small size of the exact product I had bought last time, but vowed to go to Costco and buy a different brand next time to get the most value. I can stand for some level of consumer confusion – but NOT when it comes to price!

An Early Adopter for Once in my Life

Today, I'm actually going for it... and upgrading my "free manufacturers phone" to the I-Phone 3GS. The Guy assures me that such a drastic change is going to change my very personality....

Only time shall tell, but I guess I think of myself highly enough to challenge him that this won't be the case. I will report back in a week or so to tell all....

The Economics of Living in California

So, as I move on from the Midwest and I head out to Stanford GSB… I am now moving to California. The Guy and I shopped for houses in the greater Palo Alto area a week ago… and we found a great 2BR house, with a big yard and patio and two parking spaces that actually fits our budget! But despite the cheery news, the reality is my cost of living will be going up SIGNIFICANTLY. I currently pay $1000 a month in “rent” to the Guy (helps go toward his mortgage). That includes all utilities/parking etc. The rent for our new house will be $2650, which does not include utilities etc., which we can estimate at $150/mo. The Guy has advertised that he wants to / is able to pay more than me for our housing expenses. Let’s assume that means he will pay for all of the utilities. That brings me to $1325 in rent = a 33% increase in housing costs while I eliminate all income and take on debt. Hooray. We could go with a more economical apartment ($2200), rather than a house… but I think I am going to have a hard time convincing the Guy – he’s in love.

The Guy never likes it initially when I am his voice of budget reason (recall last night, when I forced him to go to the value grocery store vs. the convenient luxury grocery store), but later (when he realized the value store saved us $25) he appreciates it. So I will keep testing the boundaries of being prudent without losing all levels of desirability.

The OutWest Road Trip!

As mentioned in my previous post, the Guy and I are going to be setting out on a crazy OutWest roadtrip, starting in two months. Origin: Minneapolis, Final Destination: Palo Alto. Duration: One week in the car.

Frugal Tactics: staying with friends and using hotel points, eating at roadside diners as highlighted in our much beloved manual, RoadFood, using Cheap Gas Finders online, or various Costco locations along the way, and planning our own entertainment in advance (each leg of the trip will have a theme – accompanied by music, readings, etc.), and buying an America the Beautiful Pass in advance to save on the national park entry costs.

Estimated Total Cost:
Gas: $350
Lodging: $0
Food: $420
Parks/Parking: $80 + $30
Entertainment: $30
TOTAL: $455/person for a week-long memory. Priceless? More to come…

Guide to "Inexpensive" Makeup Picks

I have officially switched out of my $30 bucks a pop nice MAC foundation and back to drug store brands… and am quite jubilant about it. One little recessionista step for me. I stumbled upon the April InStyle feature on Best Beauty Buys for 2009 on the treadmill this morning and instead of rushing out to the mall to buy more urgently needed makeup, I scampered over to Target.

They published a shopping list for the category, and I have listed the only items in their “inexpensive” category below, i.e. what you can find in the drug store. (A lot of the best beauty buys are apparently $100+, not so recessionista friendly. Even the inexpensive picks average around the $8-10 range, which depending on your priorities... isn't always so attractive.)

LIPS: Loreal Paris Colour Riche, Revlon Super Lustrous, Maybelline Shine Seduction

EYES: Loreal Paris Voluminous Mascara (on my list), Loreal Paris HIP Powder (I can vouch – I love this stuff!)

CHEEKS: Loreal Paris Bare Naturale Mineral Doux

FACE: Max Factor Erace Cover Up (on my list), Loreal Paris True Match Foundation (what I bought tonight!)

June Goals: Upping the Joy Factor

1. Finish planning THE OUTWEST ROADTRIP (more on this later)
2. Complete 3 weeks of training for a 5K
3. Fully Fund my ING Savings accounts to help build toward sidebar goal #2
4. Bring more joy into my life...

I was at a wedding last week on Martha’s Vineyard, and I was so overcome with the consistency at which this one attribute was cited in the couple’s life and home. To talk over and over about joy, levity, and laughter, as opposed to love, at one of these affairs, seemed much more to the point. I want that to be said about me some day, and I hope I can bring more joy into others’ lives. To help remind myself of all of the little joys I am going to try to read the principles of positive psychology once daily, meditate more on scripture, and get little moments of writing in – even if it’s not about remedying the novel – but just for the joy of it!

May Goals Update

Yes, I made May goals even though I didn’t post them here… And I did okay with them for the first half of the month but was sliding downhill the last half of the month. First the positives...

+ I passed my Excel exam for Grad School
+ I have been much more efficient at work – about a half hour or so more efficient – which I have been using for personal pursuits like planning travel and b-school prep
+ I have been devoting more time to reading.

Writing, not so much. Saving, not so much. Too be reflected in my June goals.