Friday, August 5, 2011

Flight and Fight

Moving is hard. I hate change in general, and moving just changes everything.  You get lost, your mail gets lost, you don't know anyone, you can't find the bathroom while still half asleep and you keep forgetting where all the light switches are. The loneliness is probably the hardest part, but I would rank having to wake all the way up to find the bathroom as a very close second.

Moving is also expensive. You have to pay for a truck, overlapping rent payments, an additional security deposit, application fees, take-out for at least a week while you search the boxes for your kitchen equipment and replacements for all the stuff you broke because you were too cheap to hire a mover. All that is just for switching apartments. Should you decide to switch cities, states or countries, you will also be slammed with a whole host of fees related to insurance and personal identification.
When the Grige and I moved into our current apartment, I really thought we were done moving. We bought a big TV and a bed frame – a piano desk for him and a reading chair for me. I thought we were settled for a least three or four years. But now that the flash cards are packed away and the GRE is over, His Grigiousness has filled the space with giant scrolls of building schemes and other art work for his portfolio and has started talking about leaving the capitol.
Needless to say, I'm not pleased. I'm not a fan of grad school to begin with, and now we are talking about packing up our lives to go to another city and state where I have no job so that he can spend tens of thousands of dollars that we do not have. Of course I want him to go to the best school he can get in to, but for me to just pack up and go with him seems like financial idiocy.
So here is yet another problem that you cannot spray roundup on. The alternative is to commit personal and romantic suicide by trying to live apart for two years. Maybe we could do it, but neither of us want to. And now we are in the very awkward position of choosing between love and money  - as well as the unknown future and the familiar present.
For me, the decision carries extra weight, because I'm not the kind of woman who just follows her boyfriend around. I could shout at you all day long that there is a difference between making a sacrifice for someone you love and letting gender dynamics make your choices for you, but I would still be bartending or event planning to make ends meet while the man in my life pursues his passion. Not only is that not fair, but it's not me.

At least not without some kind of compromise. Which is exactly what the Grige suggested. "Where do you really want to live?" he asks me when I get upset and start yapping about feminism (while he cooks me dinner, no less). And what he's hitting on there is the real meat of what I want to talk about here, in this blog: You can't let money run your life.
What you can do is spend and save the money you do have as best you can. We will probably move. It will probably be to a place where we can ski, hike and play outside more. Somewhere we can afford more than a 1-bedroom apartment someday. Somewhere it's not so hot that I have to have a "no touching rule" for more than half the year. Somewhere the Grige is, because that is where I really want to live.

Money is important, and it's so easy to let it grab us by the ear and pull us down a path we have no real interest in walking. It's important to have people like the Grige in our lives to remind us that we don't always have make the safest financial decision. Sometimes it's worth the risk to reach for what you really want, instead of what you know you can get. If you don't get it? You're resiliant, you will start over. If you are lucky, someday you will be able to sleepwalk to the bathroom again.

Dress for Your Day

"Dress for the job you want, not the job you have" used to just mean that you should wear a suit, even if you are the copy boy. Things have changed since then – many offices have gone business casual or have flexible dress policies. However, the mentality is still the same. I want to look as well-dressed and polished as the person who holds the highest position available at my place of business, and I think most other ambitious young professionals want to as well. 

The problem is that clothes are expensive! And if you want to get things tailored to fit perfectly and have matching shoes – forget it. By the time you add astronomical dry cleaning bills into the equation, dressing for work can cost you more than they're paying you to do the job in the first place.

Coming out of the college environment where appropriate daily attire has expanded to include sweatshirts and ripped jeans, it can be hard to imagine wearing seemingly uncomfortable clothes that you've reserved for graduations, weddings and funerals every single day. It can be even harder to imagine the amount of money you're going to have to spend purchasing and maintaining them.

It is possible to look polished on a budget, but sale stalking is just the beginning. The trick is to buy clothes you like and can afford, but then take great care of them. That means wearing undershirts, dry cleaning weekly and buying some shoe shine and a nice shoe brush (and using it).  If you have a strict care regiment, these clothes will look good for a few years or more, and you can enjoy adding to them rather than replacing them.

A good tailor and cobbler can also increase your bang for your buck. I've had my favorite pair of heels for almost 9 years. I have had them re-heeled twice and I bleach clean them once a season. Re-heeling costs about 20$ for a pair of shoes and you can clean them yourself with bleach and laundry detergent.  It's a lot cheaper than buying a new pair of shoes once a year. A good tailor can take a $40 sale rack dress and make it look like a $100 + masterpiece, just by altering it to fit you perfectly.

Wearing simple clothes that really fit you well with seasonal, colorful accent pieces like jewelry, scarves or cardigans can keep your costs low and your style high. It's possible to wear a simple black dress or skirt 3 times a week without anyone noticing that it's a re-run.  The same goes for guys with a nice, dark suit.

So don't let the cost of new clothes keep you from putting your best foot forward at work. Head to a tailor/dry cleaner with those pieces your parents bought you and inject some life back into them, because there's nothing worse than looking like an assistant.

See you at the sale rack,
Double E

Wednesday, August 3, 2011

The Great Groupon Debate

There are a lot of deals out there that look like they are saving us money. The Grige and I have a hot debate open on the Groupon/Living Social deals, and whether or not they are actually saving us money. To be fair – I've only used either service for meal-related deals, though I'm trying to score one of the escapes/getaways for our anniversary weekend. I'll report back on that if it works out.

The Grige thinks that, while nice, these deals are actually costing us more money than they are saving us. While I have a strict "it must be in our neighborhood" rule about the deals I purchase, most of the restaurants are not places we go regularly. He argues that since we wouldn't normally go there, spending any amount of money for a meal there is excess spending. In addition, these deals usually come in increments of $50.00. Since we are good citizens and tip 20% on the full amount when the service is decent, this means we're out at least whatever we paid for the deal + $10.00. Finally, when we know we have $50.00 to spend on a meal, we have a tendency to go a little nuts and order nicer entrees than we normally would, drinks and maybe even an appetizer or dessert. The end result is usually a bill that is well over our deal-allotted $50.00 and we end up shelling out as much as $100.00 for a meal that was supposed to be a "deal".

I usually put our experiences in the context of spending $100.00 for a $125.00 dollar meal. Money saved is money saved, period. I also like to try a new place every once and a while, and saving $25 dollars is a great way to do it. Letting deal availability drive my restaurant choices also simplifies my life by eliminating decisions. Simply put, I am a fan.

At the end of the day, I think we're both right. The Grige's suggestions highlight the crux of the issue: the real problem with misusing deals is personal judgment. We can't blame deal drivers like Groupon and Living Social for our spending habits. They are giving us a discount, while sending us to try new places, which is a good thing. It's our fault that we decided to go bananas and spring for the bottle of wine and dessert, and we need to hold ourselves accountable for that money.

So the next time we're out for a meal with a deal, we're going to stick to that $50.00 limit (or at least close to it, this is D.C.) and not let the allure of "free money" lead us down the wine list. We'll save the "special" meals for actual special occasions, because a coupon is not an occasion.

Double E

PS: If you're not up on the deal finders, you should be. You can start with and, but there are plenty of other options out there. Just remember to keep your selections in check!

Debt, Credit and Hiding Under the Bed

We've established that I am terrified of debt. I generally think this a good thing. It keeps me from buying that gorgeous pair of $300 shoes and from fronting $100,000 that I'll never be able to earn back for that Ph.D in English Literature that I'm dying to spend the next 6 years working on.

But maybe it's not always a good thing. Maybe when it's time for me to buy a house, and a loan officer hands me a pen, I'll scream like he's the crypt keeper and go hide under my bed. Thank heaven for the Grige! He frequently says things like "good debt", "opportunity cost" and "well, do you want to raise kids in our one-bedroom aparment?".

So when is the time right to drop some real money, and what are the kinds of things you should feel okay about going into debt for? My first thought is that a house, car and maybe educational debt are the only kinds I could handle. But maybe there are other things we should go into debt for. Maybe that payment plan for the nice sofa is worth it, and perhaps it's okay if you can't pay for every piece of your wedding all at once.

The problem is, it's hard to tell the smart deals from the gimmicks. It seems like every retailer I visit wants me to sign up for their special credit card deal, and every time I make a large purchase, someone is trying to talk me into a payment plan that I don't need. How can one possibly make a smart decision while being bombarded with propaganda?

I tend to take a conservative approach, and given the economy and the fact that I'm still pretty early (read unstable) in my career, I think that's best. The following are some guidelines to keep your finances under control, but still get the things you want:  

·         Pay your balance. I didn't have a credit card until I was 23. I only caved because my credit rating was in the toilet, and I still use it exactly like a debit card – diligently paying my balance every month. It's annoying, but our society demands that we pay for things with credit instead of money we have. Just make sure that you don't put anything on your credit card that you wouldn't charge to your checking account unless it's an extreme circumstance.

·         Stick to one card.  I know it's tempting when you are checking out at your favorite retailer and they offer you an additional 15% off, but you have to remember that it's part of a business strategy. The whole reason the store is pushing that card on you is because statistically, you will spend way more once that card is in your wallet. according to researchers at the Federal Reserve Bank of Chicago, "the initiation of a 1% cash rewards program yielded, on average, a $25 reward each month and an increase in spending by $68 a month and in credit-card debt of $115 a month." I have been on both sides of the checkout counter and I've found that "no thank you, I'm not interested." will keep most salespeople from hassling you too much. You definitely don't owe them an excuse, it's your money and your credit rating.

·         Save first, buy later. Maybe you can't save the full amount for your goal, but you should spend the time to at least tuck away a good down payment for big events or items. This way you can get in the habit of making payments while earning interest, instead of paying interest.  

·         Only take advantage of a payment plan when you need to. If you are purchasing furniture or large electronics, there can be some great payment plans available to help you get what you want. Keep the timeline on the payment plan as short as possible and only buy one large item at a time. Once you have paid it off, you can move on to the next big purchase.

So perhaps it is okay to accrue some debt to get the things we want and need. But if you max out your credit to buy that new furniture set and then get bedbugs, how are you going to pay the exterminator? With a little patience and a conservative approach, there's no reason you can't do both.

Yours in the Red,
Double E

You can read more about the Federal Reserve Bank of Chicago article here: