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poor and stuck

February 10th, 2019 at 06:51 pm

So for about 3 months DH and I lived in a ghetto. I hate to use that word but I don't know how else to describe it. I found a rental online and had no idea about a new city. It was cheap and month to month, close to my work, took dogs, and we didn't have many choices. We hoped it would be short term and it was. It was pretty much our first and only time living in a city. Previously and since we never have and have made a conscious decision to live in suburbia and further out because we hate city living. I can't sleep, the noise, the closeness of people, I don't care to walk everywhere. It's not us. And while I grew up lower middle class it was more rural/small town. Never had I lived in a city like this.

But back then we were young and crazy. So we moved into a neighborhood we certainly stood out. The people were very nice. Our neighbors talked to us, more than one actually warned me to stop walking my cute white dog (bichon frise) alone even during the day. She said "you're that girl with the white dog. Everyone is talking about you. You should be over in that other neighborhood where you would fit in." This was probably true.

So I stopped walking the dog. One day across the street from us a dog was impaled on the spokes of the fence. Another time there was the home invasion, probably looking for drugs according to the landlord. It was not a safe place.

But what did I learn? Buses don't stop in poor neighborhoods. You have to jump out in front of them and wave but they just keep going. You stand under the sign and they aren't full but they keep going. There aren't many bus routes and they don't seem to run late, unlike richer/nicer neighborhoods. A lot of people are always waiting for the next bus that never shows up because it's breaking down. Funny how it's the buses to the poorer area that seem to break down more. There are less train/subway lines as well.

The gas station had a cashier behind bars and you had to prepay cash for gas. The gas was also ridiculously over priced at this small gas station versus going down the road to even the big 76 or chevron or shell in another town.

The local grocery store was still about a mile away from where we lived. The food was disgusting. It was like all the going to spoil meat, fruit, veggies from every other neighborhood had been sent there as a last stop before being thrown out. The store itself was also more run down and not as clean. It was constantly packed even though the food was more expensive than driving 15 minutes to another nicer neighborhood same chain store.

DH and I made an effort to only shop at costco 40 minutes away and grocery stores in the neighborhoods we were looking for a townhouse 20 minutes. We noticed a huge difference. But I mean realistically I wonder how many of our neighbors could afford to drive outside the neighborhood and get better food for less money? At the same time if they did they could fill up for less money since gas was about 30 cent more per gallon.

Because of this we definitely rushed a bit picking our next place than we might have. But it also 10 years later affected how we shopped for apartments. Instead of me picking a place again online, we drove into the city and rented a hotel room for 1 week. We drove around and saw all the places first. This time we decided we weren't going to take the same risk of picking a place we didn't like.

But this short experience made me realize that many people don't have the same opportunities. That people in a lot of these situations are stuck. The only thing they know are being poor. I can see an EF being helpful. But there are also these roadblocks that make it really difficult to get ahead. How do you know that driving means you can get cheaper gas and better food? That it might be cheaper to live further out in a nice neighborhood with better schools? But how to do you afford the car that won't break down and gas to get to your job? How do you know to get job in suburbia that is similar to what they have now.

But how do you change the system?

staying in poverty

February 8th, 2019 at 05:49 pm

So I have to further explain to CCF how hard it is to get out of poverty. It really is when people are always telling you no and not helping you.

So my grandfather wanted to be a engineer. His dad said no way. No money and go get a job to help support the family. Lucky for him he was born number 9 out of 13 kids. He got to finish high school. His older brother finished 6th grade and got jobs for money to help support the family. This is why I always give a $1 to every salvation army bell ringer I see. I make my kids because my grandpa always did. He got their Holiday Baskets growing up. Wearing rice bags sucked since they couldn't afford clothes, good thing hawaii was warm.

Anyway he had dreams, but the dreams were beaten down by his family who said why bother with education? Go work. You don't need to study. Make money. The example was to drink and gamble. So it wasn't exactly encouraging. So he gambled and worked and had 4 kids. Lucky for them the Ob/Gyn said Mrs C you can't afford more kids lets sterilize you. THANK GOD or my mom would have been really poor. Yeah I don't think Dr are supposed to do that and now they would be sued.

But my grandparents were fun, young, caring parents. When he went on a gambling winning streak there was money and food. That's when you pay rent, shoes, clothes, and food. They didn't have a checking account until the 1970s when all their kids had checking/savings accounts and my uncle helped them.

My uncle at age 14 went to work and started paying the bills. He took each younger sister and taught her how a checking account work. How to pay using checks, how to be frugal. He said it was something he heard about from others not within our family. The rest of the family well they weren't exactly model citizens on my grandpa's side and my grandma's side was just poor.

Her father passed shortly after she left home and left a single mother with 6 kids at home. My great grandmother needed all the kids at home to work and help her financially as she cleaned homes, museum, and took in laundry and sewing and her mom lived with her. My aunts aunts on that side also learned after leaving home from their husbands. They lived in the country so they had very little and no way to help.

So it's not like people sit there and teach you how to budget. They also don't encourage you to save money. I guess they knew but there was never enough money.

Like I said I always feel bad my mom went into debt for us to go to Disneyland. But she said she never regretted it. We took out a personal loan from the bank. I mean when she got divorced from my dad she cut up all her CC and never charged what we couldn't afford. But what we could afford was meager. The real problem was we had a hard time saving. But things got better.

But by the same token my DH came from middle class. His parents both worked but they had no idea how to navigate this country when they arrived. They worked stereotypical immigrant jobs like delivering chinese food/driving a cab, bakery/dry cleaner. Again they had no idea how to manage money but DH's uncle, the one who died, he came first and fortunately smart guy sent money home to the rest of the family and helped each of his siblings come over and figure out how money worked. DH's dad grew up in a shelter and went to boarding school because they were smart and couldn't afford to live otherwise. So it was really hard to get ahead without the one person who quickly learned how to survive. His uncle always said it was luck.

So I think we need more education programs to help people learn about having more. Otherwise all they hear is they can't do anything. They can't figure out without help how to get out of their situation. But nowadays it just seems harder than ever. Wages have stagnated. No more pensions. Instead you have to save for yourself. A lot of these low-middle income people could retire because you didn't have to save or know how to save or invest (like my mom). Instead you work 30 years and there is your retirement! Presto!

I know it's not feasible but I think pensions help lower income people by far more than higher income people who usually know how to manage.

Have you seen people able to get out of lower income levels? Have you done it? If you have, how did they do it?

reflecting back

February 7th, 2019 at 06:26 pm

I've been reflecting back lately on a lot of people talking about the government shutdown and how people are paycheck to paycheck. I do feel bad. Yes I understand they should have planned better. They should have not been living paycheck to paycheck. Hopefully they learned their lesson. Doubtful but maybe.

Doing taxes I see a lot of people living paycheck to paycheck and just trying to make the rent. They take out an advance against their tax refund to make ends meet. I want to shake them. I want them to make better decisions.

Truthfully I feel awful for those working poor. I don't know how you get ahead. It's so hard when you barely make enough that you can't repair the car. You can't buy the bulk packaging because you don't have the cash.

That was me. I grew up definitely like that. Looking back I didn't know any better till I got older, and I'm sure my mom and grandma knew better but we just didn't have the money to do it.

We had food stamps so we bought what we could with them. Stuff that wasn't food stamps we only bought when on sale and what was on sale. We couldn't buy the biggest size for the cheapest price because sometimes we didn't have the cash for it. And I remember the days of waiting for the food stamps to come and it was a great day to go shopping. It used to be this little coupon book that you tore out and you had to be really careful on what you bought. But when we got it we almost always bought steak for a steak dinner. End of the month and no food stamps? Lots of rice and tofu and poi. Of course sometimes we killed the chickens or my grandfather went hunting and we had wild pig.

So I get it. Saving $1000 was a huge deal. I remember my grandfather would often trade work for repairing the car with friends. He'd help doing a home repair or something and he'd get free mechanical work. And the cars we had sucked big time. They were constantly needing work but that was the real problem with cheap second hand cars. We even had second hand tires.

So people think it's easy to tell those living paycheck to paycheck to save. It's really not. One stupid car repair, one medical bill and you are wiped out. It's impossible to get ahead. You can't even buy clothes on clearance because you don't have money. Goodwill and hand me downs are the way to go. I had a lot of hand me downs from my boy cousins. I wore a lot of blue and green until age 5.

When I compare myself to now I realize boy have I changed a lot. I have gotten extremely priviledged and i'm a little shocked. Shocked by quick the turn around happened. I admit I'm nervous too. My kids have no idea. They were born to us when we had lots of money comparatively.

I guess that's why I feel bad when people talk about living on a budget and saving. I know how hard it is. I guess like is more like the conners/roseanne than people admit. And it's a lot less easier to climb the socio-economic ladder than people think or imagine.

I can tell you talking with my mom. When you don't know any better like how to maintain a house, maintain a car, what is a stock/bond/cd, how to balance a check book, what is a savings account, that even that "middle" class lifestyle is beyond what you can imagine or try to do.

Did you experience the same thing? Have you changed your circumstances so drastically?

It's girl scout cookie time

February 4th, 2019 at 05:29 pm

It's girl scout cookie time. Funny how fast it goes by time. My kiddos want the prize at 400 boxes each, an inflatable chair. I said they have to work hard. Sell cookies presales and do a lot of booths. Right now we are at 275 each but it's way not enough. I'm curious if we can make it.

As to the trouble in my troop? One kid I said can't come without supervision. Her mom decided to pull her. The second one is on a tight leash. If she gets a call for misbehaving she's also gone. One parent is because she's too busy. Other parent because it's a privilege for extracurricular. Third parent is going to try and stay but unsure how things will play out.

I'm hoping that next year I have a smaller troop with less drama. I'm really annoyed that people see it as free babysitting. I'm really annoyed that so many moms also are not putting any effort into participating. I am unsure how to change it next year. Ideally I'd like to kick out some of these parents who are not participating. But I'm unsure how to frame it nicely.

So many are such good sports. And these couple of rotten apples? Well it's made this year not pleasant to be leading the troop. It was so much more pleasant last year.

Financial Fitness

January 29th, 2019 at 03:30 pm

People ask me all the time how to save more money. I say at work, while doing taxes, stop spending it on crap. That's me being blunt. The other part I say is just put it on 10% and save it before it hits your account and you won't see it. Again nothing fancy.

But honestly a bigger problem? A lot of people have trouble saving money because they have a lot of bills. What sort of bills?

A really expensive mortgage. Instead of 33% PITI it's 50% PITI. It's hard to get ahead when have your income is gone. Or other people are spending $1k/month or more on a car payment. Or 2 car payments. Having bought a $28k minivan and $26k subaru legacy with 3 year payments of $500, I can see how if you drive a $50k/car you are paying $1k/month for 5 years! Um wow. And that's one car. again it's hard to get ahead and save if you are paying say $3k mortgage, $1500 on cars. Then private school or after school care for another $1-2k/month.

Then suddenly all your income is already mostly spent before you even start paying for things like cell phones $100/month, internet $100/month, gas for cars, groceries, etc.

The real problem is that even watching these other categories which are flexible and can be minimized if you don't have enough money after paying all your set bills you can't save. You can't build an EF. Of course not. I mean who would? No one.

So when I see clients making $20k/month gross but then struggling and telling me so. I can easily guess it's the house, car, or private school/college.

So my tip is curb the spending to 50% needs, 20% saving, and 30% wants. If you do this you'll be fine.

What's your number one financial advice?

my troop update

January 16th, 2019 at 10:45 am

I managed to talk to my troop program manager a woman who works for girl scouts. She had to talk with her supervisor. She said that I am to tell the mother she can no longer drop off her child. She must stay. I must ask her to take the child if she can't stay or another friend or family member can stay with the girl.

As much as she needs this there are other liability issues and things that have to be also considered including the safety of the other children. I have to write an email and ask if she understands since she still hasn't responded since Friday.

All the parents I emailed haven't responded. However I have to follow up and see they understand. But in this case the mom can't just drop and run to therapy or any other business. It's not so simple. While she needs help and support unfortunately we can help to the best of our ability.

This has been a wild ride this year.

collections agent

January 15th, 2019 at 03:02 pm

So I got a call from a collections agent. I'm not sure what to do. I refused to pay a $200 bill to frontier because I returned a set-top box and cancelled cable. They said it never returned. However whenever they use the prepaid mailing envelope and search for it they find it. So this has been going on since July 2018. I refused to pay and keep on writing down who I talked to.

Anyway now they turned it over to a collections agency. I'm debating if I should even bother talking to them? Frontier are obviously jerks and terrible customer service. I am not paying for something I don't owe.

I wonder what they can do?

my girl scout troop

January 11th, 2019 at 11:08 pm

So I know this is a financial blog but I just need to vent. This year leading a girl scout troop has been a nightmare. Today it took the cake.

So where do we start? Guess the easy one. A mom brought her dog into the school to pick up her daughter and the dog pissed on the floor. I was appalled. I had to send her an email saying don't bring your dog into the school. I thought this was pretty standard. But I guess I was wrong. Common sense/courtesy is dead. They didn't even clean it up.

Second kid was poorly behaved. This is the 2nd time and I had to email the mom that she needs to start staying and helping at the meetings to focus her daughter. I don't know how this mom will react. She didn't react to the first email I sent about behavior.

Third situation a mom gave me a restraining order against her husband. They had a domestic violence incident in public, he went to jail, they are being sued. The TRO is for her and the kids. Apparently if he shows up I should call the cops. I emailed her and told her I wasn't comfortable with her leaving her child in my care and expecting me to deal with 12 other girls and her daughter. She needs to be present to deal with the situation. I don't think she's going to like me or the situation I required.

This year I find it incredible difficult with many of the new girls being difficult. They are rude, I've been talked back to, and ignored because they are unable to sit, focus, and listen. They sort of have been acting like very young children.

I am not making up how awful some of these kids are. I was sent an email from the secretary of the school I attended and she said that there have been noise complaints from teachers working late about the noise and disruption from our troop. Hence why I sent out the email last meeting. And this meeting I really cracked down. And now I have to pull parents in more for 3rd graders!

Okay enough venting. This was just me blowing off steam. My husband said it's a volunteer position and this is how it is.

2018 recap

January 7th, 2019 at 05:21 pm

I finally have time to write about our 2018. I still have to rebalance our portfolio. I should have probably have done it in December but I was so busy I didn't have time.

Well I already maxed out our 2019 Roth IRA contributions today. I had it transferred and will roll it into the Roth IRA next week. I also interesting made DH's company match be after tax dollars into his 401k. I will discuss with DH the ESA contributions for the girls at $2k each.

So we are in a conundrum in 2019. Should we contribute more to the 401k after tax? And roll it into our Roth IRA? Or should we do taxable investing? Hard choices.

We increased our net worth for 2018 by $27k. Mostly by paying down our debts.

We lost around $1000 on our retirement savings after contributing $36k including the company match. UGH. So we lost $37k on our retirement accounts.

Our taxable accounts we lost $21k in value. So we were down $58k in our investments. Our cash decreased $12k for the year. So how did we increase our net worth?

Paying off our debts. So we officially saved $28.5k to retirement and everything else went to debt. We paid off a ton of debt. Our car on lease we bought out $18k, but started year with $21k in December. Paid our home renovations $35k the 2nd half that we had started paying 9/2017. We also paid off $10k I owed my mom for college I had forgotten to pay for years. She had my written IOU. We also paid private school tuition $7800, $5000 braces for DH and DK1 and our mortgage went down $20k and $5k on minivan through regular payments.

Since the stock market was wild and down for 2019 I obviously A LOT of bang for our buck paying down and cash flowing all those debt. Perhaps long term we might have done okay investing close to $75k cash but we also would have lost say 10% or $7500 this year and had to have made it up somewhere. This way instead we have a paid for car, a forgotten student loan paid, and all medical bills free and clear.

All in all I am satisfied with 2018. My goal for 2019? Bulk up our savings and not spend all that money we used paying off debt to pay off more debt

i peeked

December 20th, 2018 at 10:07 am

I peeked at our portfolio. I haven't done anything more than look at the numbers and boy are we bleeding. Our retirement is down less than we contributed. Same with taxable. Only thing saving us is our cash.

Oh well I'm due to rebalance anyway first week in January I'll do it. We've lived through this before. In 2007-2008 because we take such an aggressive investment stance we take very large declines. This time we're down more than we contributed but since retirement is another 10 years off we're fine. Keep on investing same time monthly and annually. I won't change a single thing. In january I fund Roth IRA and kids VTI college funds.

One thing that will also save our net worth is paying off $20k in mortgage, $20k in car loans. Debt reduction. Of course paying cash for the end of our renovation helped too.

Have you peeked? Are you changing anything?

unexpected home expense

December 16th, 2018 at 10:40 am

Because of a big wind storm on Friday a section of our fence fell down and broke. Sigh. Now I have to figure out someone to come out and fix it. I really want this done asap because we are dog sitting a dog and it's hard to let the dogs out of house.

I don't want to make a claim and DH said the neighbor we share the fence with wants to talk to her insurance. Ugh. Of course they apparently have more damage than just the fence so that may be it. But I'd prefer to consider costs. Our deductible is $1000 anyway so it has to be hefty to pay. Of course if I could get DH to do it himself that would be nice. He did the fence at our last place but he isn't interested in doing the work now.

Just another home expense. People who wonder about the 1% maintenance rule? DH and I have found that it is true. We've found that things just come up and maybe some years it's like $0 but then other years big things come up all at the same time.