Last December we went to Mexico for a wedding. It was absolutely beautiful there and I loved every moment. Great friends, great food, and lots of tanning. I still look pasty white though by the way. However, there were a couple of culture shocks. First, the policemen with machine guns on the side of the road. Second, the expectation of tipping. That got me thinking more about tipping. How did I get from sun and sand to tipping!?!
I have to admit, I have always hated the concept of tipping. However, I give in to the social pressure that it is expected of me. Essentially it is a self-enforced tax. A tax under the honour system you could say. However, I'm not really sure who determines the amounts and what jobs are included. After all no one tips the cashier at Shopper's Drug Mart or Save-on Foods. Aren't they in the service industry too?
In Mexico, it is more than just supplicates income though, in some cases it is their entire income. While this really made me appreciate how good we have it here, it also made me wonder if tipping was part of the problem.
Waitresses have told me I don’t understand how hard it is to work in a restaurant. That they need those tips to survive. They are right; I don’t know what it’s like, because I didn’t want to work in the restaurant business. Well that’s not entirely true, they just didn’t hire me. Regardless, the reason they put up with what they do is for the money in the form of tips. If the tips stopped, they’d look for work elsewhere. Restaurant owners would be forced to pay more money to keep the good employees and they’d pass the cost on to us. The food prices would increase, but the tipping would stop. Essentially we're telling restaurant owners and bars that it is OK that they pay their employees less, because we'll take care of it ourselves.
Maybe it is because we don’t want to see those higher prices and can somehow justify the food tax (tips), but can’t pay a little more for food and drink. You might even pay less. I wouldn’t have fun on a resort in Mexico with no Margaritas, no servers, no cooks, and making my own bed. I’m going to pay for it all anyhow, so you might as well put it in my bill. It was all-inclusive after all.
Those are my thoughts on tipping. Any one care to fire back?
Thursday, April 29, 2010
Monday, April 26, 2010
Debt Snowball
OK, my wife got offered a casual postiion as a nurse. So it's finally time to speed up the debt repayment. Don't worry, we plan to enjoy a little of the extra funds too ;). So how do I plan to dig out of this hole? I'm going to use a little technique called a debt snowball. A debt snowball is actually better than it sounds. Don't blame me, I didn't come up with the name.
I've heard it discussed several times with different names. The first time I heard it was several years ago in a free budgeting program offered at our church. It was more recently discussed by Primerica when I chatted with them and since then I've read it in several books.
So, what is it? It's a debt reduction strategy used to pay down multiple accounts. If you only have one debt to pay down then, this isn't going to help, but good for you! However, if you have multiple credit cards or student loans, or lines of credit with amounts owing, this could be a good strategy to help you out.
I'm sure you've heard people say that paying the minimum on a credit card balance is just stupid. The reason for that, is because you're paying almost all interest and have no hope of paying the card down. So, you might currently be paying more than the minimum on multiple loans. This can get quite discouraging as the debts never seem to go away.
With this strategy though you will be paying the minimum on all of your debts except for the smallest one. Anything extra that you were putting towards the other loans, or any other money you were planning to use to pay down the loans, should now be put towards this smallest loan only. You can see how this loan would get paid off fairly quickly.
Once this loan is paid off the payments are then applied towards the next smallest loan. Only this time the debt repayment has grown because it includes the minimum payment from the first loan and the minimum payment from the second loan. Like a snowball rolling down hill (hence the name). By the time you get to the larger debt you're applying a much larger payment.
Not only does this help to pay off the loans more quickly, it also give you a much greater sense of achievement as each loan disappears. I think the emotional response is the most important aspect of this concept. After all if you lose motivation, even your best intentions will fall by the side. So while you're technically better off paying the highest interest rate loans first, it is no where near as satisfying. However, if two debts are similar in size, you probably want to pay the one off with the higher interest rate first.
This only works if you can afford to pay more than the minimums though. If you can't afford to make all your minimum payments, then you need to fix that problem first. Hopefully you can do that on your own by adjusting your budget and sticking to it, or getting help by a professional if need be. I reached this point a few years ago and consolidated the loans into a home equity line of credit. This eased the burden, but now left me with a big loan to pay off. I'm saving this one for last.
Debt Snowball Example:
Let's say you have the following debts and for simplicity we'll ignore the increase with interest:
Visa - $225 balance - $25/month minimum
MasterCard - $1000 balance - $30/month minimum
Car Payment - $3000 balance - $175/month minimum
Line of credit - $5000 balance - $250/month minimum
Assuming you have an extra $200 to use above the minimums, you put that towards the Visa and it's paid off in one month. Yes, I made that simple on purpose ;)
Then the next month you apply the extra $225 towards the master card (note it's now $25 more already). Four months later the MasterCard is paid in full. Fast forward 14 months and everything is paid in full.
I'm going to put up my net worth as soon as my wife starts full time. Then if you're interested you can see a real life example of the debt snowball. Although, my balances are much higher than in the example given.
Anyone else tried this or willing to give it a try? Love to hear your experiences.
I've heard it discussed several times with different names. The first time I heard it was several years ago in a free budgeting program offered at our church. It was more recently discussed by Primerica when I chatted with them and since then I've read it in several books.
So, what is it? It's a debt reduction strategy used to pay down multiple accounts. If you only have one debt to pay down then, this isn't going to help, but good for you! However, if you have multiple credit cards or student loans, or lines of credit with amounts owing, this could be a good strategy to help you out.
I'm sure you've heard people say that paying the minimum on a credit card balance is just stupid. The reason for that, is because you're paying almost all interest and have no hope of paying the card down. So, you might currently be paying more than the minimum on multiple loans. This can get quite discouraging as the debts never seem to go away.
With this strategy though you will be paying the minimum on all of your debts except for the smallest one. Anything extra that you were putting towards the other loans, or any other money you were planning to use to pay down the loans, should now be put towards this smallest loan only. You can see how this loan would get paid off fairly quickly.
Once this loan is paid off the payments are then applied towards the next smallest loan. Only this time the debt repayment has grown because it includes the minimum payment from the first loan and the minimum payment from the second loan. Like a snowball rolling down hill (hence the name). By the time you get to the larger debt you're applying a much larger payment.
Not only does this help to pay off the loans more quickly, it also give you a much greater sense of achievement as each loan disappears. I think the emotional response is the most important aspect of this concept. After all if you lose motivation, even your best intentions will fall by the side. So while you're technically better off paying the highest interest rate loans first, it is no where near as satisfying. However, if two debts are similar in size, you probably want to pay the one off with the higher interest rate first.
This only works if you can afford to pay more than the minimums though. If you can't afford to make all your minimum payments, then you need to fix that problem first. Hopefully you can do that on your own by adjusting your budget and sticking to it, or getting help by a professional if need be. I reached this point a few years ago and consolidated the loans into a home equity line of credit. This eased the burden, but now left me with a big loan to pay off. I'm saving this one for last.
Debt Snowball Example:
Let's say you have the following debts and for simplicity we'll ignore the increase with interest:
Visa - $225 balance - $25/month minimum
MasterCard - $1000 balance - $30/month minimum
Car Payment - $3000 balance - $175/month minimum
Line of credit - $5000 balance - $250/month minimum
Assuming you have an extra $200 to use above the minimums, you put that towards the Visa and it's paid off in one month. Yes, I made that simple on purpose ;)
Then the next month you apply the extra $225 towards the master card (note it's now $25 more already). Four months later the MasterCard is paid in full. Fast forward 14 months and everything is paid in full.
I'm going to put up my net worth as soon as my wife starts full time. Then if you're interested you can see a real life example of the debt snowball. Although, my balances are much higher than in the example given.
Anyone else tried this or willing to give it a try? Love to hear your experiences.
Tuesday, April 20, 2010
Dollar Cost Averaging Part II
In part I I discussed putting money away every month for investing. Dollar Cost Averaging in this case is just a side note, as really you don't have a lot of other choices other than not investing at all. Given the choice, I'd always recommend investing. In this part I'll discuss what to do when you receive a large amount of money that you want to invest. A problem I'm sure we all wish we had.
In the Wealthy Barber, he suggests that you use the same dollar cost averaging technique. Rather than putting the money in one lump payment, you can avoid the instability of the market by spreading it out over the year or longer. Again this just made sense to me and until recently it was what I was planning to do if money ever happened to fall into my lap.
However, in my search for real number, rather than the make believe ones always given as an example, I stumbled across a few interesting articles. This method has been taught for a very long time, but in reality it is not as effective as you might think. First off every transaction you make has fees associated with it. So multiple transactions is not in your best interest, if you can avoid it. Second, if the return on the investment is greater than your banks interest (which it almost always is), then you're losing out on potential income.
Just like a fixed rate mortgage there is some piece of mind associated with dollar cost averaging. Also, just like the fixed rate mortgage you're paying for that piece of mind. Almost every time you're better off investing in a lump sum amount.
The suggestion for this post came from the comments on here. I'm sure it's not exactly what he was hoping for, but unfortunately it's all I have time for right now. If anyone else has any suggestion, feel free to drop me a comment or e-mail.
In the Wealthy Barber, he suggests that you use the same dollar cost averaging technique. Rather than putting the money in one lump payment, you can avoid the instability of the market by spreading it out over the year or longer. Again this just made sense to me and until recently it was what I was planning to do if money ever happened to fall into my lap.
However, in my search for real number, rather than the make believe ones always given as an example, I stumbled across a few interesting articles. This method has been taught for a very long time, but in reality it is not as effective as you might think. First off every transaction you make has fees associated with it. So multiple transactions is not in your best interest, if you can avoid it. Second, if the return on the investment is greater than your banks interest (which it almost always is), then you're losing out on potential income.
Just like a fixed rate mortgage there is some piece of mind associated with dollar cost averaging. Also, just like the fixed rate mortgage you're paying for that piece of mind. Almost every time you're better off investing in a lump sum amount.
The suggestion for this post came from the comments on here. I'm sure it's not exactly what he was hoping for, but unfortunately it's all I have time for right now. If anyone else has any suggestion, feel free to drop me a comment or e-mail.
Monday, April 19, 2010
Dollar Cost Averaging Part I
Doesn't help to stay up late to make sure I have a post for Monday and then not set the date correctly. Sorry for being late again.
Markets have ups and downs and its near impossible (if not impossible) to predict the swings. People often panic when the markets crash like they did in 2008. In fact if not for panicking and greed there probably wouldn't be very much money to make on the stock market. So with this volatility, how can we safely invest in the market.
When I first heard about Dollar Cost Averaging (DCA), I was impressed with the simplicity and power of it. For simplicity I'll talk about stocks, but I'm more likely to hold mutual funds myself. What you are investing isn't that important when discussing this technique. By investing a set amount every month, you buy more stock when the price is low and less when the price is high. You don't need the stock to rise above what you initially paid. It only needs to rise above your average.
Here's an example (modified example from the Wealthy Barber):
Let's say you decide to invest $100 a month in XYZ company.
Month 1 the stock price is $10/share, so you buy 10.
Month 2 the stock price is $5/share, so you buy 20.
Month 3 the stock price is $7.50/share, so you buy 13.33 (Yes, you can actually buy 1/3rd of a share).
So, even with the share lower than your original purchase price you have 43.33 shares at 7.50/share. You spent $300 and your stocks are now worth approx. $325. Even with the share price down, you've still made money.
The theory sounded great, but I wanted to know how it works in real life. I found an online calculator for dollar cost averaging and ran it against several different stocks and they all came out ahead in the end. I should have bookmarked it, but it didn't really interest me because I don't invest in common stock and it didn't work with mutual funds. My personal funds are doing OK, but I don't have any numbers for 2008 as I wasn't investing at that time due to limited funds.
The biggest benefit to knowing this method is the piece of mind it brings. When the market goes down, you're picking up stocks for a bargain. While others are panicking, you're profiting off of their sales. If you're investing though, you really don't have much of a choice other than to invest in a small fixed quantity. We're not going to come up with our retirement money all in one deposit, so we have to do it in small increments. You can tell people you're dollar cost averaging, but really you're just investing the only way you can. Just keep your head and stick to the plan and you'll come out fine on the other end.
Keep in mind we're talking long term investing here. If you need the money in the next 5 or so years, this probably isn't the best place for you and it's time to move at least what you need, into something less volatile.
Next I'll talk about dollar cost averaging when you come into a larger sum of funds.
Anyone continue putting money in through the recent crash? How are your funds doing now? Did Dollar Cost Averaging work for you?
Markets have ups and downs and its near impossible (if not impossible) to predict the swings. People often panic when the markets crash like they did in 2008. In fact if not for panicking and greed there probably wouldn't be very much money to make on the stock market. So with this volatility, how can we safely invest in the market.
When I first heard about Dollar Cost Averaging (DCA), I was impressed with the simplicity and power of it. For simplicity I'll talk about stocks, but I'm more likely to hold mutual funds myself. What you are investing isn't that important when discussing this technique. By investing a set amount every month, you buy more stock when the price is low and less when the price is high. You don't need the stock to rise above what you initially paid. It only needs to rise above your average.
Here's an example (modified example from the Wealthy Barber):
Let's say you decide to invest $100 a month in XYZ company.
Month 1 the stock price is $10/share, so you buy 10.
Month 2 the stock price is $5/share, so you buy 20.
Month 3 the stock price is $7.50/share, so you buy 13.33 (Yes, you can actually buy 1/3rd of a share).
So, even with the share lower than your original purchase price you have 43.33 shares at 7.50/share. You spent $300 and your stocks are now worth approx. $325. Even with the share price down, you've still made money.
The theory sounded great, but I wanted to know how it works in real life. I found an online calculator for dollar cost averaging and ran it against several different stocks and they all came out ahead in the end. I should have bookmarked it, but it didn't really interest me because I don't invest in common stock and it didn't work with mutual funds. My personal funds are doing OK, but I don't have any numbers for 2008 as I wasn't investing at that time due to limited funds.
The biggest benefit to knowing this method is the piece of mind it brings. When the market goes down, you're picking up stocks for a bargain. While others are panicking, you're profiting off of their sales. If you're investing though, you really don't have much of a choice other than to invest in a small fixed quantity. We're not going to come up with our retirement money all in one deposit, so we have to do it in small increments. You can tell people you're dollar cost averaging, but really you're just investing the only way you can. Just keep your head and stick to the plan and you'll come out fine on the other end.
Keep in mind we're talking long term investing here. If you need the money in the next 5 or so years, this probably isn't the best place for you and it's time to move at least what you need, into something less volatile.
Next I'll talk about dollar cost averaging when you come into a larger sum of funds.
Anyone continue putting money in through the recent crash? How are your funds doing now? Did Dollar Cost Averaging work for you?
Thursday, April 15, 2010
Tithing
I mentioned in my last post that I ran into a problem with the Ten Percent Solution. Well the problem, I encountered is that while 10% is quite easy to do (providing I use it for debt right now), 20% is quite out of the question. So I have to make tough decisions about where that money goes. That is where the discussion with tithing came up between my wife and I.
I wasn't planning on writing about my religious beliefs, but I think it's going to become unavoidable. It's not that I'm embarrassed about it, or don't want to discuss it, but I just wanted to keep the posts and discussion accessible/applicable for everyone regardless of their beliefs. However, it is a big part of my life and I was pretty naive to think it wouldn't come into the picture. So perhaps some of you may find this only as a curious glance into the finances of my Christian life.
If you're Jewish or Christian, you've probably seen the 10% recommendation before, but in another context Tithing. As a Christian I believe that God is the ultimate owner of everything I own. In fact Christian often refer to this as stewardship, which I was recently reading about in my accounting book. A steward is responsible for the careful and responsible management of something entrusted to his or her care. So we believe the money isn't truly ours, but it's only in our care. While many people think a discussion of money is almost un-Christian, I think the mismanagement of funds would be considered more so.
Many non-Christians I talk to seem to think that religion is all about rules. So to clarify this is not a requirement about being a Christian. Its a decision I choose to make because of the impact God has had on my life. The specific amount to tithe is not a rule either, but 10% is often used as a guideline. In fact though, we're encouraged to give much more than that. I'd love to say I'm doing that, but sadly that's not the case.
Just like I've post-poned building wealth until the debt is repaid, I've also post-poned tithing until that same time. I'm sure some would disagree with that concept, but I feel that having the debt for longer than necessary would also be a mismanagement of funds. The plan is to be out of debt in 2 years at which point I'll need to make a decision of what to do with that 10%.
I suppose the decision should be obvious, but I must admit here is where I struggle. While I do believe God provides for us, I'm also a strong believer that he gave us brains to use as well and we can't expect things to be handed to us. I believe it's important to use the skills that we've been given and I believe mine is financial aptitude. My struggle is that I know it's the starting out that is the hardest part and by giving 10% in tithes, my wealth building then becomes extremely difficult to accomplish.
So this is my struggle and in the end I think I know what I'm going to do. I'm going to put my trust where it belongs and rely on God to take care of the rest. If He does want me to be wealthy, then it will happen regardless. However, I just wanted to share in the hopes that maybe it will help someone else with similar struggles. God said that we can only serve one master, either Him or money, and it feels like this depicts that dilemma clearly.
Anyone else with the same struggles? Any tithe levels greater or less than 10%?
If you're interested in any of my other beliefs feel free to comment or send me an e-mail.
I wasn't planning on writing about my religious beliefs, but I think it's going to become unavoidable. It's not that I'm embarrassed about it, or don't want to discuss it, but I just wanted to keep the posts and discussion accessible/applicable for everyone regardless of their beliefs. However, it is a big part of my life and I was pretty naive to think it wouldn't come into the picture. So perhaps some of you may find this only as a curious glance into the finances of my Christian life.
If you're Jewish or Christian, you've probably seen the 10% recommendation before, but in another context Tithing. As a Christian I believe that God is the ultimate owner of everything I own. In fact Christian often refer to this as stewardship, which I was recently reading about in my accounting book. A steward is responsible for the careful and responsible management of something entrusted to his or her care. So we believe the money isn't truly ours, but it's only in our care. While many people think a discussion of money is almost un-Christian, I think the mismanagement of funds would be considered more so.
Many non-Christians I talk to seem to think that religion is all about rules. So to clarify this is not a requirement about being a Christian. Its a decision I choose to make because of the impact God has had on my life. The specific amount to tithe is not a rule either, but 10% is often used as a guideline. In fact though, we're encouraged to give much more than that. I'd love to say I'm doing that, but sadly that's not the case.
Just like I've post-poned building wealth until the debt is repaid, I've also post-poned tithing until that same time. I'm sure some would disagree with that concept, but I feel that having the debt for longer than necessary would also be a mismanagement of funds. The plan is to be out of debt in 2 years at which point I'll need to make a decision of what to do with that 10%.
I suppose the decision should be obvious, but I must admit here is where I struggle. While I do believe God provides for us, I'm also a strong believer that he gave us brains to use as well and we can't expect things to be handed to us. I believe it's important to use the skills that we've been given and I believe mine is financial aptitude. My struggle is that I know it's the starting out that is the hardest part and by giving 10% in tithes, my wealth building then becomes extremely difficult to accomplish.
So this is my struggle and in the end I think I know what I'm going to do. I'm going to put my trust where it belongs and rely on God to take care of the rest. If He does want me to be wealthy, then it will happen regardless. However, I just wanted to share in the hopes that maybe it will help someone else with similar struggles. God said that we can only serve one master, either Him or money, and it feels like this depicts that dilemma clearly.
Anyone else with the same struggles? Any tithe levels greater or less than 10%?
If you're interested in any of my other beliefs feel free to comment or send me an e-mail.
Monday, April 12, 2010
The Ten Percent Solution
In The Wealthy Barber, David Chilton suggests a solution to building our wealth. He calls it the Ten Percent Solution. The concept is actually quite simple. Invest ten percent of all you make for long-term growth and you'll wake up one day very wealthy.
Most people of course react to this with sceptism. The biggest objection, is being able to afford to put 10% away. If that money come right off our pay cheques though I'm pretty sure most of us wouldn't even notice. I remember once when I receieved a fairly nice raise of 5% and I couldn't tell you how my spending changed at all. It doesn't take long for the money to be used up. The opposite is equally as true. If we took a 10% pay cut, most of use wouldn't even notice (except for the bad attitude at work).
This isn't in lieu of your retirement planning either. He's actually suggesting this on top of any retirement planning you have. Your retirement plan is to enable you to stop working, while the ten percent fund is to enable you to have more fun while not working. Trips you wouldn't otherwise take, a boat you wouldn't otherwise buy, etc.
Seeing as I don't like talking about things I'm not doing myself, you're probably wondering how its going for me. Well, truth be told, it's not. The problem with this concept is that Chilton doesn't tell you what to do when you're in debt other than to stop using credit cards. Obviously none of us want to be in debt (or stay there very long), so it's my goal to get out of debt as quickly as possible. So to do that I've been using the ten percent solution to pay off my debts. Once my wife starts working, the debt repayment should speed up nicely. The plan is to also start putting money away for retirement once again after she starts working.
Once the debt is paid off I can continue on with the payments to build wealth. I did run into a little snag with this plan though which I'll touch on more next post.
Anyone already doing this? Any success or failure stories? Do you think Chilton and I are crazy?
Most people of course react to this with sceptism. The biggest objection, is being able to afford to put 10% away. If that money come right off our pay cheques though I'm pretty sure most of us wouldn't even notice. I remember once when I receieved a fairly nice raise of 5% and I couldn't tell you how my spending changed at all. It doesn't take long for the money to be used up. The opposite is equally as true. If we took a 10% pay cut, most of use wouldn't even notice (except for the bad attitude at work).
This isn't in lieu of your retirement planning either. He's actually suggesting this on top of any retirement planning you have. Your retirement plan is to enable you to stop working, while the ten percent fund is to enable you to have more fun while not working. Trips you wouldn't otherwise take, a boat you wouldn't otherwise buy, etc.
Seeing as I don't like talking about things I'm not doing myself, you're probably wondering how its going for me. Well, truth be told, it's not. The problem with this concept is that Chilton doesn't tell you what to do when you're in debt other than to stop using credit cards. Obviously none of us want to be in debt (or stay there very long), so it's my goal to get out of debt as quickly as possible. So to do that I've been using the ten percent solution to pay off my debts. Once my wife starts working, the debt repayment should speed up nicely. The plan is to also start putting money away for retirement once again after she starts working.
Once the debt is paid off I can continue on with the payments to build wealth. I did run into a little snag with this plan though which I'll touch on more next post.
Anyone already doing this? Any success or failure stories? Do you think Chilton and I are crazy?
Thursday, April 8, 2010
The Problem with Free
In economics, I learned about a concept called the free-rider problem. If a good or service is free then people will take advantage of that good or service every chance they get. Nothing is really free, so I should clarify that to mean no additional cost. For example, how many of us eat way too much when we go to an all-you-can eat buffet. You're full before you're done your first plate, but you already have plans to go back for more.
Water in BC is another example. I know some other provinces charge for water usage, but I'm not sure which do and don't. So at first I was thinking this was a great benefit to living in BC. With the free-rider problem though, there is no incentive to reduce the water used. Someone has to pay for the filtering, storage, and delivery. That "someone" ends up being us all collectively through taxes. In a pay system I could actually take measures to reduce my usage as it's in my best interest. I don't care if my neighbor takes 2 hour showers or leaves the water running while he brushes his teeth, because I don't have to pay for it.
Another example that is hitting closer to home now, is health care. As my wife wraps up her schooling this month, it is becoming apparent that a shortage of nurses does not translate into a hiring of nurses. Part of the problem is that management in any government organization is better served by maxing out the departments budget rather than providing better service. The other part of the problem is that because we've paid for the service we're more than likely to use it. Increasing the strain on a health care system already under pressure while mismanagement of the limited funds makes the situation worse.
So I'm left asking if free is really in our best benefit. We've already seen the effects of a pay system in the US and it was also plagued by its own set of problems. However, at least there my wife would have no problem finding work.
Just something to mull over. I'm not offering any solutions, although I do have my opinions on how the system could be improved. I'm still positive that my wife will find work soon.
Has anyone else encountered problems from those so-called free services?
Water in BC is another example. I know some other provinces charge for water usage, but I'm not sure which do and don't. So at first I was thinking this was a great benefit to living in BC. With the free-rider problem though, there is no incentive to reduce the water used. Someone has to pay for the filtering, storage, and delivery. That "someone" ends up being us all collectively through taxes. In a pay system I could actually take measures to reduce my usage as it's in my best interest. I don't care if my neighbor takes 2 hour showers or leaves the water running while he brushes his teeth, because I don't have to pay for it.
Another example that is hitting closer to home now, is health care. As my wife wraps up her schooling this month, it is becoming apparent that a shortage of nurses does not translate into a hiring of nurses. Part of the problem is that management in any government organization is better served by maxing out the departments budget rather than providing better service. The other part of the problem is that because we've paid for the service we're more than likely to use it. Increasing the strain on a health care system already under pressure while mismanagement of the limited funds makes the situation worse.
So I'm left asking if free is really in our best benefit. We've already seen the effects of a pay system in the US and it was also plagued by its own set of problems. However, at least there my wife would have no problem finding work.
Just something to mull over. I'm not offering any solutions, although I do have my opinions on how the system could be improved. I'm still positive that my wife will find work soon.
Has anyone else encountered problems from those so-called free services?
Monday, April 5, 2010
Update on Flooring
Ever since we bought this place we wanted to replace the carpets. However, money has always been an issue. So although we're planning on a home renovation budget of 150 a month when my wife finishes school, we realized we would probably move before we got to enjoy the new flooring. I refuse to borrow any more money for consumption, but we received a nice tax return and decided to buy the flooring with it. It's probably more fiscally responsible to spend that money on paying down debt, but we decided that hating where you live to save money doesn't make sense.
Now or later, the money needed to be spent. I don't think we'd have any chance of selling our home like this. I didn't want to fix it up right as we're moving. I want to get a little joy out of the money spent too.
In my previous post about Plastic Debt Aaron suggested paying cash to receive a discount. I thought about it, but in this case opted not to. If I wasn't in debt, this definitely makes a lot of sense. However, in this case we already bargained a good price, put the tax return on the LOC, and get the 1% bonus dollars for my credit card. The interest saved on the LOC makes up for the savings any cash payment would have given me (I hope).
We discussed carpet, but I don't feel comfortable putting that down myself. Hiring a crew is not only expensive, but not realistic. We'd have to empty the rooms, but we're talking about doing our whole house. So we decided on laminate so I can do it at my leisure. I couldn't convince my wife to try carpet tile. Maybe next time.
I'll post pictures when it's done. I'm stressed with everything I need to do, but what's one more thing right?
Crazy investment, or a balncing act? What are your thoughts?
Now or later, the money needed to be spent. I don't think we'd have any chance of selling our home like this. I didn't want to fix it up right as we're moving. I want to get a little joy out of the money spent too.
In my previous post about Plastic Debt Aaron suggested paying cash to receive a discount. I thought about it, but in this case opted not to. If I wasn't in debt, this definitely makes a lot of sense. However, in this case we already bargained a good price, put the tax return on the LOC, and get the 1% bonus dollars for my credit card. The interest saved on the LOC makes up for the savings any cash payment would have given me (I hope).
We discussed carpet, but I don't feel comfortable putting that down myself. Hiring a crew is not only expensive, but not realistic. We'd have to empty the rooms, but we're talking about doing our whole house. So we decided on laminate so I can do it at my leisure. I couldn't convince my wife to try carpet tile. Maybe next time.
I'll post pictures when it's done. I'm stressed with everything I need to do, but what's one more thing right?
Crazy investment, or a balncing act? What are your thoughts?
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