Not cheap, Fiscally concerned

Wii is an awesome gaming console which forces us couch potatoes to stretch our bony arms. This isn’t news to anyone - the Wii was released over a year ago and I believe it is much more popular in family settings than other game consoles. Our friends just bought it for Christmas and while we visited I had a chance to play with it a bit.

I’m embarrassed to admit it to every Joe on the web, but - boy - am I out of shape. My back and right arm muscles were hurting this weekend. That’s me - a Wii-Wimp.

This holiday season for us was not a big shop and spend one. Our financial outlook for the next year has become less optimistic on a cash-flow basis, which means we had to tighten the belt a bit. As we always do though, we did agree in advance that at some point in the future - after we budget for it - we too shall purchase a Wii.

Wii is also basically sold out right now in most places, and there aren’t any really greatly enticing deals. Our friends purchased on a special sale at Meijer a week or two AFTER black Friday and got a great deal.

Is Wii a replacement to exercising? More importantly, should one count on Wii and avoid real planned physical exercise? I doubt it. We should always spread out the exercises across the body and not just the arms. I’m not saying that as a specialist, since I’m definitely not (I am a Wii Wimp) - but from a generally logic view point.

So regardless of owning or planning to own a Wii - here’s the simplest solution to us couch potatoes. Move some furniture in your living room, put in a DVD or some exercise-on-demand from comcast and start moving until you feel some burn. It’s much cheaper than purchasing a gym membership and then feeling guilty about not going due to: work schedule, feeling lazy, need for family time, need to drive during bad weather, missing out on good weather, feeling like fat chump in front of strangers.

A word to the spouse of the “recently decided to exercise in front of the TV” men and women. If you love and care about your mate - either walk away to a different room, or join the “action”. Any giggle and smart-ass remark is a big turn off.

Guys - don’t feel embarrassed - TV/DVD workout is for everyone, not just wives.

Best thing I like to do after I force my self to move a limb in an attempt to exercise - relax with a cold, bubbly, deliciously brewed beer.

Cheers!

I thought the next video was pretty funny…

Times are tough - it doesn’t mean we should be inconsiderate ;-). Frugal and fiscally mindful - yes, cheap - no.

Cheers!

When I said there’s more to life than money (or losing it in the stock market) I meant it. I’m happy to announce that today our third daughter, Maya, was born.

No bad weather can spoil days like these.
Cheers!

I used to question the relevance of studying imaginary numbers in school. I was told it is useful in physics.
Wikipedia: Imaginary number - so yea, no imaginary numbers - no battery for you.

In times of extreme market pessimism, you might squint at your brokerage statement, look at the number and get confused, you might think for a moment that you are looking at imaginary numbers…

Just remember - there’s no i or square root of -1 in this financial calamity.

You know - it might be a cliche but there are more important things than money. Money doesn’t buy happiness, though it can help. Our family is getting geared towards a fantastic next week and I’ll post about it after the occasion. Focus on the good stuff in life.

Here’s something funny I stumbled upon, within Math Humor, found:
Top Ten Math Major Pick-Up Lines

10. You fascinate me more than the Fundamental Theorem of Calculus.
9. Since distance equals velocity times time, let’s let velocity or time approach infinity, because I want to go all the way with you.
8. My love for you is like a concave up function because it is always increasing.
7. Let’s convert our potential energy to kinetic energy.
6. Wanna come back to my room….and see my 733mhz Pentium?
5. You and I would add up better than a Riemann sum.
4. Your body has the nicest arc length I’ve ever seen.
3. I wish I was your derivative because then I would be tangent to your curves.
2. I hope you know set theory because I want to intersect you and union you.
1. Would you like to see my log?

Cheers!

I know I’m not rich. I know I can’t afford whatever I would spontaneously desire. There’s no excuse to not dream. I have ambitions, and there’s no desire to become rich if you don’t dream it. That being said, one has to question himself – what if you do become rich, what would you do with the money. Would you hug it every night and read it bedtime stories? Would you let it rot in a safe till the day you die? What’s the point of “getting rich” – if you hadn’t enjoyed your path to riches?

More importantly, and most relevantly – what if you never become rich. Or, what if you gained your riches only to lose it all in the market? It happens every day, and in every generation. People raise themselves to great possessions, only to lose it in a flash. What if your “riches” are seized by a socialist government? What if your tiny pot – which you thought has made you relatively wealthy, is made worthless by political events and inflation running out of control?

The point of the recent paragraph is to show that getting rich isn’t as important as knowing what would you like to do with your money if you had any. And since you might have none – knowing what you would do with, would motivate you to accumulate funds so you could spend it. Getting rich isn’t a goal – it’s a milestone, life goes on. Your goal should take into consideration what you want to do with the money.

“This one step - choosing a goal and sticking to it - changes everything.” Scott Reed

A responsible person does not spend whenever he “feels like it”. If you want something, the best thing to do is write it down. Then do some research; how much would it cost in different circumstances. Acknowledge you want to pay for it in cash – not in credit – and add it to a big list of things you would spend money on. Goals do not begin and end with “things” you want. You must look into the future and recognize things you would need. You would need to retire. You would need to support your family in an emergency. If you have kids you would like to be able to assist them – as needed. You might want to assist your kids with financing studies, or starting their financial life. Dream a new you. Dream a better future. Would you like a vacation home? Switching new or used cars every few years? Move to a different state? Starting a new career? Starting a business? There are many different things you might dream of. Write them down. If you are married, write them separately and then combine the list.

Prioritize. Which things are more important? Ask yourself which things you would need. Ask when. Then imagine yourself reaching them. If you plan well and execute a financial plan you could reach many of your goals. Do the research and see how much money would be needed and when. When you will be able to know how much money would be needed, you could construct your savings schedule.

I know my wife and I want to go on a vacation every year. We assume a certain amount and dedicate each month that cash to be spent later in the year. We identified a common goal, prioritized it, and made a financial plan to reach it. We identified several such goals – you will have your own – it is possible to reach a balance between your debts, income and savings to be able to use your money in a fun way. You might get rich, I might get rich, but before that milestone, I would have tried to meet my goals responsibly. The responsibility comes into play by spending money I have, and that I have accumulated for that goal – not obligating myself to paying it through debt and jeopardizing whatever future goals I might have.

Some goals will rely mostly on your actions – money might not be necessary or be an obstacle. Debt might be acceptable – if goals must be met before having the money at hand. Identifying how much things could cost would allow you to write a “life plan”, a schedule of big things you plan on achieving. Such plans are made with the intention of changing as life happens. The goals will help you stay focused and avoid reckless financial decisions at the wrong time.

Money will help you achieve your goals – only if you first dedicate the time to identify your goals.

Cheers!

Regardless of where I am at life, I always feel humbled and a need to know more and seek better and greater success. I am quite proud of my achievements thus far but I know that life is a journey, and through that journey I strive for more. The obvious path to acquire more knowledge is to seek what others have discovered through reading. And reading a lot is what I want to do. I wish I did read a lot more. Most of the time, when I plan to read, I stack up a queue – and set myself up for failure by doing time wasting things. Things like watching TV, playing computer games and reading news and commentary on the web. Having a family (I love you guys) doesn’t help that goal. Kids require our attention as parents and my wife rightfully expect us to communicate at our leisure time, not to bury our faces in books (or blogs) most of the time. Getting tired or unmotivated at times can also be a challenge.

Since books are our window to further improve ourselves, we like to cheaply possess more and more, to give us a chance to know more. Buying new books all the time at the store as soon as they arrive is only good if you can’t wait. You might HAVE to buy right now – if you are boarding a long flight and have not stocked up in advance with entertainment or books for the flight.

Here are a few ways we reduce the cost of books we read:

• Join the local Library and borrow. You already finance it through your taxes – make use of it. You can usually order new books you want and are unavailable yet. You might also be able to reserve a book online as well.
• Sign up for a book club. I would especially recommend a paperback book club.
• Buy paperback editions, or wait until the paperback is out. It’s usually cheaper
• Buy used at Amazon’s marketplace (or Ebay’s half.com)
• Buy on special sales at the library. Our library makes such a sale once a month and we stack up with many excellent classics and children literature at those sales.
• Buy at Amazon discount sales and have it ship for free – still much cheaper than the store.
• I don’t know about you - I don’t like reading e-books although I do have a laptop. There are many free e-books sites out there…
• When you are in college, consider swapping books with other students. Also, try ScratchWork.org - it seems to provide a lot of benefits for students beyond books exchange.

Being frugal and enjoying visits to the book store gets tricky. My wife and I, as well as the kids, enjoy the occasional visit to the book store to browse through the new selections. We sometimes do indulge our selves – when the budgeting is right – and buy something.

I wanted to write a post about buying books on the cheap, but when I began my preamble – I got carried away with my personal story. If you are still interested, the following was written subsequently after the first paragraph.

More about reading and striving for knowledge…

When I studied for my graduate degree online I was married and already had our first child. I was working full time and I dedicated the night hours to studying. Usually between 10:30pm to 2am. It was a fully packed day and only because I was driven by a schedule and homework deadlines did I read and finish my tasks. As graduation approached, I felt a void in my time was forming – such voids are easy to fill with nonsense – but combined with a New Year resolution I expressed a desire to fill that void with a desire for knowledge.

At first I set my sights on learning a new language - French. There’s something romantic and exciting about new languages. I bought a book, some CD-s and began learning without restriction of a framework pressuring me to reach results. I played the Fifa soccer game on my laptop while listening to “learn French” audio content daily for about 20 minutes each day. I put a CD in the car and listened at the car for a while. I peeked and read about 3 of the first chapters of the French for dummies book (I find the name of the book series insulting, but the content superb). I wouldn’t call that experience a success or a failure – it’s a work in progress, and after about 3 years of studying I think my ability is akin to studying in class for the second year.

Next, came my desire to understand money better. As it was for many others, the need to understand how to manage your own money comes out of immediate necessity. We earn money, we spend money, I wanted to save some of it as well and reach a balance together as a family. We bought two books together and have been following a plan for 2 years now which should take us to where we want to reach together.

Starting to accumulate savings in different forms (retirement, college fund for kids, money market account and others) is what drove my next big curiosity. Now that we will have taken charge of our financial destiny – where should we steer our funds? Should we just stuff it under a mattress? Just let it lay there in a bank (in a dark cold safe, all alone without a hug from crusty crab)? What would be a risky choice or a safe choice? Budgeting and savings is only the first step – the next step relies on making money management decisions.

I began watching CNBC. I think that at some point in life in America, most people do. I took interest in Cramer. His show was loud and he tried very hard to grab attention by joking around. I bought his books too. Two of them. I’ve also finished reading those two books. Because of the time of day the show is on, I gradually watched less and less of that show. All the while, I did not take his advice – and did not invest in stocks. I assumed (correctly) that I don’t know enough – and jumping in the water head first is dangerous (especially when the pool is half empty).

As mentioned in my post about not watching CNBC – Cramer is a complicated man (link to Overstock.com CEO’s thoughts on Cramer). I assumed that much way before it was proven. I still respect his advice – but I take the CNBC disclaimer very seriously. It’s an entertainment/educational show. It’s not the gospel – and for investments it is only the starting point of a research.

I moved on. I might watch CNBC, but I just have enough reasons not to. Right now I have a queue of books on investments, options, trading and self improvement (a book from the 60-s!). The hard part is finding the time to delve in. And once that time is found and dedicated, staying focused. As my wife says – how can you read that? It sounds so boring? Well it might be, and sometimes it is and I take breaks. The problem might be what I do with these breaks (guitar, PC games, TV, movies, family time – anything but return to what I dedicated the time for).

Since we discovered the book sales at the local library, we have accumulated quite a bit of classical literature as well. At some point I do intend on enriching my culture and not just my knowledge. I still intend to finish reading our O’Henry stories collection. It seems we will probably won’t buy a new book for a while… we do need to buy some new bookshelves though.

L’Chaim! (Cheers!)

It is reasonably easy as a single person to restrict your own self to a tight budget so that you can achieve some goal like pay down a mortgage, go on that dream vacation, reach a golden number to identify yourself as rich, or simply reaching a comfortable financial safety cushion. If as a single person you find yourself unable to contain yourself from spending, get a book, get some help, use software and always ask yourself what it is you are giving up on in the near future for the momentary gratification of immediate spending. It can and is done by many.

Once you get married your financial future is intertwined. Regardless of having a joint or separate checking accounts, what you spend and what you keep matters to both of you. You can no longer keep your own personal goals selfishly, you must share those goals. If as a single person you spent some months eating very little and very cheaply, your spouse might never agree to such restrictions. If you used to shop for clothes once a year (or less), you should not be surprised to find out how such behavior might be completely unacceptable on your partner’s behalf.

People have different views of what fun is, as the former frugal single that is in a relationship you must acknowledge that your wife or husband enjoys an occasional Sunday shopping. Just walking around in shopping centers and picking up things. As a single person you might never have done that, especially not in distressed months. Now you bite your tongue and smile and say how lovely the new shirt is and how the kids definitely need all these new shoes for next year.

Trying to raise the issue of being in a financial hole can often lead to vocal arguments regarding the purpose of recent shopping. Who is the selfish one when one buys for the family based on needs and on sales and discounts, and the other wants to put money aside for vacations and other things? It gets even worse if the frugal mind fails to write down what those mysterious future needs are and then gets into a corner in the argument – accused of being cheap for the sake of being cheap.

You might think you are having a great relationship, you communicate and the love between the two of you is still blooming – you are probably right. There’s still something you should do. To become frugal as a couple, to succeed financially as a family, you must dream together. You must know what it is you want and your spouse wants to achieve financially in the near and distant future.

Dreaming of a better future is the first step. The next is getting back to reality. Those dreams should be translated into attainable goals. You should not be surprised to find out you could probably reach an annual or semiannual well funded family vacation. You should probably know that you could live rent or mortgage free if you do certain things.

Now that you share some dreams and goals look into your current joint financial situation. List out your income sources and expenses and agree to live by a budget. You may consider the budgeting system I propose here, but there are many worthy others and you must agree to adhere to that budget together.

Now that you have shared goals and agree to adhere to a budget together, begin allocating small sums into future goals. Now is the time to exercise your spreadsheet abilities (or seek some help) to see what will happen if you save so and so, and how much could you spend on your goals each year.

Speaking out of personal experience, doing exactly what I described above enhanced our mutual frugal sentiment and brought some excitement to it. We began planning annual vacations, writing destinations and budgeting costs. Every few years we plan on big ones like going to Disney world, abroad, visiting back in Israel (someday…). I bring the vacation thing again and again because that’s the easiest and most common goal. There are many other such goals and to each couple their own.

Be fiscally concerned, not cheap and remember that you need to always keep a balance between staying happy as a couple in the present and building up your even happier future.

Since starting to post on this blog – about a week ago – my wife’s been frowning at me. I sit too much time in the evening in front of the laptop and I’m not talking enough. I agree honey – and I’m sorry. I believe that communication is the key to a successful marriage. One of the examples given in the book “Dealing with people you can’t stand” is of a mature couple where the husband says nothing and the wife is frustrated. It seems that for many married couples, that situation is at least the perception of reality – if not the reality itself. The book gives a good strategy on how to improve upon the situation by engaging in inquisitive conversation and insisting on getting answers. A conversation has two sides, and if you think your partner is not saying much – be assertive and muscle out some answers. If your partner is drowning in his newspaper, book or laptop and you feel left out, reach out – touch – and stare at his/her face from a short distance. You will get that kiss your face is demanding and it is the right opportunity to talk about something. Don’t hesitate to start the conversation.

At our first years as a couple – finance was a touchy subject. Whenever I raised the issue I came out as a villain and as cheap. I avoided talking about it altogether and I silently observed as our tiny savings account shrunk further and further. We didn’t have a plan, we didn’t agree, we spent on what we thought we needed. It wasn’t selfish; whenever my wife would buy something she would feel guilty and try to explain to me how it is for the family. I struggled for years to reach an understanding between us on our money.

About two years ago I did something very sneaky. We both enjoy going to book stores and browsing through the selection. Our kids scan through their section and we take turns on looking for what might interest us. I picked up two personal finance books – “Smart couples finish rich”, and “The automatic millionaire”. I suggested to my wife that we each read one book, and when we are done we exchange and read the other. The result was stunningly good. We both learned more about managing our money and we finally began thinking together on how we should plan and execute together. My wife came up with the program discussed here in “How to spend less than you earn, in a nut shell” and I added the electronic part to it – “How to spend less than you earn, part II”.

The books introduced us to the idea of setting goals. For me it was always a given that we should save money. Even if we don’t get rich, money would be there for us when we need it. My wife, coming out of Russia and seeing how inflation and political turmoil can render yesterday’s money worthless always assumed that money is there for us to use now. We now have an understanding of why we save and how we will use the money in the future. Money isn’t accumulated so that we could count it greedily – it is there for a purpose and we have already seen the fruits of that strategy. Before – we would charge our credit and I would act frugally. We have begun taking annual vacations with money we save each year and we enjoy it so much more.

Since then, we regularly discuss where we stand on a fiscal basis. My wife no longer feels guilty she buys things when I don’t. We have turned the corner and have begun saving more. As long as our income and health do not change – we know where we are heading financially and are pleased with it.

Communicating about money between couples is key to a happy marriage.
Communication in general and expressing fondness and love is what ties it all together.

I wanted to post something about married life and money management, but I think it’s better I postponed that to the weekend. Instead I added some links to one of my favorite shows a decade ago - “Married with children”. It’s about money - and family - and both my wife and mom really hate it.

The following episode makes fun of those who quit their day job to start a multi-level marketing thing. As everyone should know by now - it’s just a bad idea to quit your day job and joining a pyramid scheme. Some poeple start blogging thinking it would pay the bills, and again, most people don’t make much money blogging (if any).

Check out the gem close to the end of the episode: “Well at least you’re not in real estate, Peg.”. Talk about blast from the past.

On this shortened episode there’s an appearance by Pauly Shore. Pauly Shore was never really funny - was he? Check this out:

They changed the opening credits theme… bummer. Here’s a reminder:

I loved that show…