The Happy Rock And The Carnival Ride - Financial Childhood Lessons

Posted by The Happy Rock on March 16, 2009

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Below is a post describing a fun frugal experience from my childhood written by The Happy Boulderette(The Happy Rock’s Mom). The story itself is neat, but what makes it even more interesting is the striking similarity it has to a post that I wrote about Teaching The Happy Pebble about the value of a dollar. It is great to see that lessons learned as a child are still bearing fruit almost 30 years later. You can change your family tree.

The Happy Boulderette has 2$ in her pocket and the local carnival is set up in the supermarket parking lot around the corner. She shares this info with The Happy Rock(age 6) - he is super excited and they attend the carnival that evening.

Quality time was spent between mom and son as they walked around and laughed and talked about how to spend their 2$. The process was long and they eventually decided to ride one particular amusement ride prior to heading home. Woohoo!!! It sure was fun!!!

Much later in life, the Happy Boulderette is pondering years back and realizes that many valuable lessons were taught that evening. Many of them were definitely financially related. At the time, she hadn’t even known she was having an impact on her son’s life.

Our children’s watchful eyes are upon us and financial lessons are being learned even when they are not intentional.

» Filed Under Children and Money, Financial Succes

In Search Of Financial Perfection Or Seeking Honesty And Growth?

Posted by Debt Destroyer on March 3, 2009

I guess I’ve arrived.

I knew I’d catch hell when I posted that I spent $180 in January on Pearl Jam related expenses. But I was surprised by how much that little morsel caught on with others.

A couple of weeks ago LuLuGal asked if I was a frugal fraud (She chose the Happy Rock too - for the $400 stroller).

To tell you the truth, I was honored to be on the list. She was poking a little fun at some fellow bloggers and I’m tickled pink that my act of super fandom made the cut.

A few days before that, Simplyforties used my love of all things Pearl Jam to make a point between wants and needs. I kinda dug where she went with it (Especially since I thought she was going to bury me like everyone else did).

And just the other day Pants in the Can was inspired by my Pearl Jam purchase to see how much he spends in a month.

But all this attention to my act of “unfrugalness” got me thinking…

Do readers of PF blogs expect perfection?

I have to admit that I’ve only been reading these type of blogs since I’ve been writing for one (8 months now). And in that time I wouldn’t say I’m looking for perfection, but I do have things that I am looking for:

Money Saving / Debt Reduction / Investing Tips - Heck, who wouldn’t be looking for these.
Inspiration - This is a big one for me. I mean really, lets face it, we all know how to live within our means. But for one reason or another some of us struggle with it, and occasionally we need a “wake up call.”
Community - I know “misery loves company”, but it also feels good to know that a bunch of people are working on the same “positive” goals as you are.
Entertainment - We probably are all reading the same blogs. If you are anything like me you like it that some of them use a little humor to help make their point.

When I accepted the gig as a writer here at The Happy Rock, I knew that people would be constantly judging me and my behavior. And I’m OK with that (for the most part). I guess the point of this post is to remind people that I’m here to share my journey out of debt. But keep in mind, that if I knew what I was doing I wouldn’t be writing about being in debt would I? (probably good advice to keep in mind when reading a lot of PF blogs).

So if you lost confidence in me because I spent too much money on a CD, I totally understand. I realize that some of you can’t spare $180 a month on such frivolous expenses (If this is the case, I hope you’re reading this on a library computer).

I think one of the best ways to learn is to make mistakes and then learn from them.

And I make plenty of them. So please, PLEASE, keep pointing out things that I could be doing better (Trust me, I need all the help I can get). And if you thought me spending money on Pearl Jam was bad wait until you see what I did in February.

I end almost every post I write by asking you readers for feedback. This isn’t some gimmick I use to get comments. I REALLY want to know what people think and how everybody else goes about doing the things that I do (I’ve already changed my phone/internet provider thanks to the feedback I got).

So…

What do you look for as a reader of PF blogs? Do you get anything from my ramblings about my finances? What type of topics do you wish were written about(not just here but in general)?

And I know I probably have never said this before, but thank you very much for taking the time to read this blog. I know how busy we all are, and it means a lot that you took a moment to read what I have to say. I hope you keep coming back.

Until Next Time,

-DD

» Filed Under About The Debt Defier, Financial Succes

Your Money or Your Life? Choosing Between Family and Career

Posted by Debt Destroyer on January 27, 2009

As I mentioned in my About Page, “Your Money or Your Life?” is my favorite personal finance book that I’ve read. But this post isn’t about the book.

This is about a decision that my wife made today.

As you long time readers know, I’m going back to school, so we’ve been depending on my wife’s wedding photography business to bring in the bacon around here for the past 6 months or so. And while we’ve had to tighten our belt to make it work, so far it has been just fine.

Today I took a message for my wife from a potential bride who was wondering if her date was still available (a tip for those of you getting married, it’s never to early to line up the photographer). After I passed on the message I had to go to work so I didn’t get to hear whether or not she booked the gig. But before I left, we joked that it would be the weekend that we’re trying to reschedule our NYC trip (late Aug-Early Sept).

I told her if that’s the case that she should book the wedding because we’ve already canceled the trip once, and it’s questionable if we’ll be in a position to go this year.

During supper tonight she brought up the call. Instead of the NYC trip weekend, it was for the weekend after.

The weekend of my cousin’s wedding.

My wife & I are quite found of this cousin. Her parents were wonderful to us when we lived in the Twin Cities. During that time we became very close to their family. But we’ve moved back to SD five years ago (OMG! it’s been that long) and now we only get to see them a couple of times a year.

We were quite pleased to hear the good news over the holidays. This particular cousin had once been the “black sheep” of the family. But as she matured she changed her friends, her surroundings, and her lifestyle. In a very short time, she turned into the “normal” one (if there is such a thing in my family).

In an ironic twist, when my cousin first told me the good news, her original wedding date conflicted with a wedding my wife is shooting. I figured that me and the kids could take a fun little road trip without Mommy around, but my wife was devastated. But when my wife called to inform my cousin that she couldn’t make it, she found out that the date had changed.

So now we have a cousin’s wedding with a moving date. Would she book the wedding or go to one? What would you do?

It’s a tough call for me. As much as I’d like my wife to come with us, I’d also like her to have a few more weddings booked too. That’s one of the problems with this line of work. All the early calls are for the dates you don’t want to work, but you feel pressured to book them in case the phone stops ringing. Especially in a recession where you are the sole bread-winner.

My wife told the bride that she was unavailable.

While I’m quite proud of her choosing family time over working, I’m also nervous that phone won’t ring and that we’ll regret this decision later. But that’s just who I am. In reality it’ll probably just mean that our NYC trip will transform into a trip to the Twin Cities.

And that wouldn’t be all that bad.

Until next time,

-DD

» Filed Under About The Debt Defier, Careers, Financial Succes

Student Debt…How Much is Too Much?

Posted by Debt Destroyer on December 10, 2008

According to the local public radio station, South Dakota students carry the highest debt load in the nation. I was shocked to hear this for a couple of reasons:

South Dakota Universities (public ones) are very affordable. For example, I’m currently enrolled in 17 credits (6 graduate, 11 undergrad) and tuition & books totaled slightly less than $4000.
South Dakota incomes aren’t that high. So if these students are going deep in debt only to get a low paying job, they are setting themselves up for disappointment.

Perhaps because of #2 above, I guess I shouldn’t be surprised that students are needing help to afford school. Most people here don’t make much money, so of course they’d need help to pay for school. Heck I just took out a $7750 loan to help me go back to school (and me & my wife still owe around $6,000 from our first go around with school).

So I probably shouldn’t be shocked at all.

According to the Quick Fact Section at The Project on Student Loan Debt, borrowing is becoming more prevalent.

By the time they graduate, nearly two-thirds of students at four-year colleges and universities have student loan debt (66.4% in 2004). In 1993, less than one-half of four-year graduates had student loans.

In addition to the number of students needing help increasing, the amount they need to borrow is also increasing.

Over the past decade, debt levels for graduating seniors with student loans more than doubled from $9,250 to $19,200 – a 108% increase (58% after accounting for inflation).

But at the same time the news is talking about South Dakota having the highest student debt burden, I also remember hearing stories about how this fall’s enrollment in South Dakota schools was the highest ever. So clearly people are OK with borrowing for school.

But are those days near an end?

During Thanksgiving, my wife’s cousin was telling us about her experience at college, she’s a freshman going into social work. This girl’s Mother joked that she should be on the lookout for a rich husband since social work is not a very lucrative field. But in all seriousness, I can see this being a concern for those low-paying fields that require a college degree.

I know that I hope to not have to borrow any more money just to land a teaching job.

But I guess it probably wouldn’t be so bad except when you add on credit card debt and a car payment, fresh college graduates can find themselves behind the financial 8-ball in no time.

So Happy Rock readers, what do you think about all of this? If you went to college, did you need a student loan? If so, was it worth it? And to what level do you think we’ll keep borrowing to go to school?

I look forward to your insightful comments.

Until next time,

-DD

» Filed Under Children and Money, Debt Elimination, Financial Succes

Financial Thanksgiving List

Posted by The Happy Rock on November 27, 2008

In the spirit of gratitude and thanksgiving I wanted to list all of the financial related blessings of the last year.

Another year debt free, except for the mortgage
The ability to provide for two wonderful children
Second adoption paid for with cash
$11,000 adoption tax credit
$2,000 adoption assistance from my employer
Two flexible, solid, well paying jobs
$5/hour raise for The Happy Rockette
Income and symbiotic relationships from The Happy Rock and other projects
Top %1 standard of living in the world - Check yours at Global Rich List
Warm, comfortable, home in a good neighborhood
The means to give to multiple different people, family, and organizations

Happy Thanksgiving Everyone!

» Filed Under Financial Succes, Giving

Dave Ramsey’s Baby Steps Review

Posted by The Happy Rock on November 17, 2008

I have stated before that I am huge Dave Ramsey fan. I think his approach to debt destruction is the simpliest and most straightforward approach. It has broad application across all income levels and focuses on motivating people and changing their behavior. I used the baby steps and the and free access to Dave’s radio show to eliminate $70,000 in 4 years.

There are officially 7 baby steps(1-7), but there is an unofficial pre-requisite that I like to put in there.

Step 0 - Stop going into debt : If you don’t stop the leak you will never be able to repair the damage. Simple as that.

Step 1 - Save a baby emergency fund : Pay minimums on your debt until you save $1,000. The purpose is to keep you out of debt when unexpected costs arise. If you deplete this fund for anything, halt the baby steps and start at step 1 again.

Step 2 - Pay off all debts, except for a first mortgage : Do this using the ‘Debt Snowball’ which is paying minimums on all of your debt except the smallest regardless of interest rate. When that debt is gone, snowball all available money into the next smallest debt. The point here is that small victories create confidence and motivation. It changes your relationship with money and spurs you on to attack the rest of the debts. This step is designed to be a full out frontal assault not a leisurely stroll through the park. Sell everything that isn’t nailed down, cut cable, movies, eating out and use the extra money for to grow the snowball.

Step 3 - 3 to 6 Emergency Fund : Relish in being debt free except for a house while using the money to quickly store 6 months of expenses. The purpose here is to shield you from major catastrophes which do happen like job loss, disabilities, fire, theft, etc. Personally, accomplishing this was the single greatest feeling, even better than paying off our consumer debt.

Step 4 - Invest 15% of your income into your retirement : Use Roth IRA’s and pre-tax retirement accounts to purchase good solid mutual funds with solid track records.

Step 5 - Fund College Savings : Skip this step if it isn’t applicable or you aren’t planning helping the children financially. Education Savings Account and 529 plans are good options.

Step 6 - Pay off the house. Use all extra money to pay off the house what will most likely only take a few years.

Step 7 - Build Wealth and Give.

I know that sounds simple and obviosuly there are nuiances to each step which aren’t covered like budgeting, insurance, and picking good mutual funds, but once you develop the discpline, control your spending habits, and change your money behavior during step 2 you will most likely have the energy and behaviors that will make all the rest seem like a cake walk.

» Filed Under Debt Elimination, Financial Succes

Is Effort A Myth?

Posted by The Happy Rock on October 20, 2008

I wanted to share this well written article by one of my favorite authors Seth Godin. He eloquently writes about why we easily fixated on getting lucky and path of personal effort.

Is Effort A Myth?

It seems that the bigger the hole we dug for ourselves or the larger the distance we need to travel to reach a goal the more we tend to wallow in hope. I think this is partly because it becomes harder to tie the small actions we can do now with so huge checkpoint in the future. So instead of action, we grind ourselves into inaction and wait for Ed McMahon. That, and luck is a lot easier!

Here is how Seth puts it:

And that’s the key to the paradox of effort: While luck may be more appealing than effort, you don’t get to choose luck. Effort, on the other hand, is totally available, all the time.

So now let’s get out there and put in some well focused extra effort and check back in a few weeks and see were it has taken us. I don’t think we will regret it and even if we do it is quite easy to return to watching a couple of hours of TV a night.

» Filed Under Financial Succes

Presidential Candidates And Personal Finance

Posted by The Happy Rock on October 16, 2008

When I look at both Obama and McCain and compare them to common sense personal finance, I realize that both candidates are the same. Neither of them get it. Both candidates have plans that are so far away from fiscal responsibility that it scares me.

Let’s take a glance at how the candidates stack up against some basic tenants of personal financial success : personal responsibility, spend less than you earn, get out of debt, have an emergency fund, and make your money work for you.

Personal Responsibility - I think the ridiculously huge pork laden bailout bill says about all we need to know on this one. Neither candidate is willing to let people(both businesses and consumers) be responsible for fixing their own mistakes and finding their own solutions. Both Obama and McCain pushed for the bill, both want to give ‘free’ money to people who don’t deserve it while the responsible Americans foot the bill. Neither candidate seemed to care about the extra 100 billion dollars that was added in order to get the bill passed.

Not once did Obama or McCain or anyone in government mention that they did anything to cause the problems. No mention of a ludicrously complex and shifting tax code, no mention of the Federal Reserve’s tinkering with rates and printing money from air, no mention of their own egregious spending, no mention of their lack of oversight in places they had promised to oversee and too much regulation in other places, no mention of any personal behavior change and no mention of encouraging change in our own citizens.

Spend Less Than You Earn - Both candidates want to cut taxes(decrease income) and significantly increase net(added in edit) spending. The plans of both candidates are set to add trillions to the national debt. Even in the debates both candidates refused to supply any hard answers to how they would pay for the bailout bill and the rest of their spending and income reductions(added in edit) through reduced spending elsewhere.

Let’s bring both candidates plans down to the trenches where Joe the Plumber lives. Imagine a dual income family in $100,000 of consumer debt. The husband decides that he is going to quit his plumbing job so that he can spend more time spending money on his personal hobbies. How long do you think it will be before their house of cards comes crashing down and the debtors that they are enslaved to come to exert their power?

The concept is simple, but it takes real behavior changes and dedication to make it actually happen. You also can’t cut your income until you stop your spending. People must control their spending before they have the luxury of willingly reducing their income. That is part of the burden that debt shackles you with.

Get Out Of Debt - Just the bailout bill alone was a thumbs up for probably a trillion or more of new debt. This means borrowing money from our ‘friends’ who we willingly give more and more control too or printing more money out of thin air which destroys the value of the dollar. The US gross debt has not gone down since 1961. The interest on the US debt was $239 billion in 2007 and 2008 which is 10% of the budget and the fourth biggest overall expense. I haven’t heard anything from either candidate that has attacked this serious issue in a meaningful way. Even balancing the budget just means you are treading water not actually reducing debt and neither candidate has given serious time to pledging to balance the budget.

Have An Emergency Fund - Nope nothing. Both candidates are content to fund their spending through debt and to use debt to solve problems. Personally, having a fully funded emergency fund was the single most gratifying and freeing financial accomplishment of my life so far. Both candidates seem content to decide to spend trillions of dollars with a only a few days of planning when a crisis arises. Not much thought is given to avoiding financial disasters and certainly not to a nest egg to fall back on.

Make Your Money Work For you - Unfortunately when you are spending 10% of your yearly budget on interest from debt your money has a lot of inertia to overcome. What happens when the spending doesn’t produce the desired results? Spend more? What kind of returns on investments are the candidates talking about with their massive spending plans? Social security, is that working? What thoughts are being given to the future and where will be financially in 20 or 30 or 40 years? I haven’t seen anything in the either plan that gives me any confidence that they are planning for anything other than the next 2-5 years.

Ok, so neither candidate could pass a basic personal finance test, what can we do about it? Take responsibility for your own behaviors that is the only thing you can do. Complaining, whining, or hiding your head in the sand will not get us anywhere. First, continue to live by these principles. Fight to get and stay out of debt, free yourself for bigger things, and prepare for the future. Help those in your sphere of influence. Shop at stores and businesses that support these goals. Talk about these things with each other and help spur one another onto bigger dreams. Finally, realize that our government system was designed to try and keep power as close to the people as possible. The bigger the federal government gets the more power you lose, so start writing your representatives. Speak up and speak out. Don’t stand for business as usual or you will get the same results. Let your parties know what you want and get others to join with you. When enough people make waves government officials notice, after all they need to get elected. Businesses notice because they want profits. There isn’t any other empowering choices other than taking personal responsibility for the situation.

*Source note - Wikipedia has a nice living document that compares the two major and four less publicized candidates on a broad range of issues - Click Here to view

» Filed Under Debt Elimination, Financial Succes, Spending

Mark Cuban Blogs About How To Get Rich

Posted by The Happy Rock on October 7, 2008

A co-worker shared this blog post by Mark Cuban, owner of the Dallas Mavericks NBA basketball team, with me and I thought it was fascinating. For those that don’t know Mark Cuban is a rags to riches stories who went from broke and jobless in 1982 to a wildly successful entrepreneur worth 2.8 billion dollars in about 25 years. In this article he shares his tips to becoming rich. Here is my ultra quick summary.

Develop personal discipline
Live frugally
Avoid debt
Have cash
Find a niche in an area you love
Use the cash to seize opportunities when it comes
Bust it hard

Here is a quote that gives you a good flavor of his attitude: “If you use a credit card, you don’t want to be rich. The first step to getting rich, requires discipline. If you really want to be rich, you need to find the discipline, can you ?”

If you follow the link at the bottom of the article you can also read the story of his rise from nothing. Mucho entertaining and inspiring.

Enjoy.

» Filed Under Chasing Dreams, Credit Cards, Financial Succes

ING Gets It Right - The We The Savers Statement

Posted by The Happy Rock on October 2, 2008

I thought this was so well thought out and written that it deserves a mention. ING Direct put out a We, The Savers statement that clearly identifies how we can be responsible for ourselves during this rough economic stretch. I appreciate the sentiment, plus ING is my bank for both checkings and savings and I love their services.

Here is the list :