Jana Says

Living life from cover to cover

Confession: I don’t understand investing

by Jana 45 Comments

This post is a part of Women’s Money Week 2012. For even more posts about savings and investing, visit womensmoneyweek.com.

It’s been a long time since I’ve made a confession. I feel that you’re due. So here goes: I don’t know anything about investing.

For a personal finance blogger, that’s a pretty sad fact. But in my case, it’s true. There’s no good reason for it, either, except for the fact that it bores me to tears. I don’t care about the stock market. I don’t care about figuring out returns. I don’t care to know about bulls and bears unless it’s knowing how to avoid contact with them. And the tickers that run at the bottom of some news networks? Are more confusing than trying to figure out where the

Believe me, I know how awful that sounds. I know how important it is to understand all of that information. It affects my retirement fund, my interest rates (does it?), and so many other aspects of my finances that it actually does me a disservice not to understand it. But I just can’t bring myself to understand it. It’s a problem I’ve had since high school when my economics teacher attempted to teach us about stocks. It was so complicated and so boring to me, I tuned it out. It’s a pattern that’s just stuck.

That doesn’t mean I don’t invest. I do have a retirement account (or two) that are dependent on investing and stocks and all of that. Sadly, I have no clue which companies I’m invested in. I tried to care when I was picking the companies. My husband encouraged me to read portfolios and about long term rates of return and all of that. And I tried. I really did. But after 5 minutes, I stopped, picked the ones that had the most interesting names and went with that. And I haven’t made a single change since I first picked the stocks.

I want to understand investing. I try to read blogs and posts about investing. I follow news stories. I ask questions of people who know what they’re talking about. I’ve been making a concerted effort to learn but unfortunately, the harder I try, the worse it gets. For some reason, my brain will not allow me to absorb the information that’s available, no matter how well written or simplified (it is at the point I feel obligated to say that I believe if I knew less song lyrics and movie lines, there would be more room in my brain for this information).  It’s as if I’ve been sprayed with investing repellant.

Sadly, I’m not alone. While I may be an anomaly in the personal finance world, I’m a statistic in the real world. In my real life, I don’t know a single woman who actually understands investing (or admits to understanding investing). Most of these women say that they leave it to their husbands to understand and take care of it; it’s just not something that they care to be bothered with or even care to comprehend. I think that’s where we differ. While they don’t care to learn or are more than happy to sit back and let their husbands take care of it, I genuinely want to learn. I just struggle more than I’d like.

I believe it’s extremely important for women to understand and learn about investing. It’s part of taking an active role in our finances. Relying on someone else to do it for us is no longer acceptable. And, if you’re willing to teach me about investing, and have an extreme amount of patience, please let me know. I really want to understand my retirement account.

Practical tips for saving money? Not always.

by Jana 26 Comments

Here in the personal finance world, many of us dispense information about saving money, living frugally, cutting back on expenses…anything to help you manage your money in the best way possible. I know I do it, and some of my favorite blogs do it. It’s information that most people need but unfortunately, a lot of the tips given are ludicrous.  They may amount to small savings, which is good and I’m sure that lots of people need those small savings (after all, little things do add up), but when you think about the tips from a practical standpoint, they’re not always the best route.

A few of the ones that I can’t stand:

  • Unplug appliances and electronics when not in use. Fine, vampire electricity is a real thing. But going around my house every single time I want to leave or every single time I come home is a nuisance. Do you know how difficult it is to get to some of the power cords? Also, I hate resetting clocks. Almost every appliance in my house is attached to a clock. Instead of unplugging everything. I’d rather just turn things off. For instance, we sleep with a fan even in the dead of winter. When we’re not asleep or in the room, we turn the fan off. Simple. Fan’s not running, we’re not paying for it. But as for the power strip that holds the cord for our TV, the Wii and the Blu-Ray player, I’m not turning it off every time I leave the house. It’s impossible to remember so I’m not even going to try. I’ll pay the extra $.74/month (or whatever it costs). [Read more…]

Golf: Saving money on an expensive hobby

by Jana 21 Comments

I recently read a post on Enemy of Debt where the author provided alternatives for expensive hobbies. One of those hobbies she discussed was golf. In her post, she gave suggestions like bartering for cheaper greens fees, sharing clubs with friends, and playing at public courses. Some of the ideas are great. Some others, not so much.

For instance, sharing clubs. As I said in my comment to that post, there are a ton of problems with sharing clubs. Sharing golf clubs is like sharing a baseball bat. There are a ton of variables that go into picking clubs: height, weight, grips, brand name (apparently this makes a difference). These variables mean that a set of clubs that will work for one person may not work for another. Also, what if the two people sharing clubs both want to golf on the same day, but on different courses? Who gets the clubs? Is there a custody agreement for the clubs?  What if one breaks? It’s just not practical. A better solution for a novice golfer would be to buy a set of used clubs and have them regripped to suit your needs. If you’re an infrequent golfer, investigate renting a set of clubs or simply borrowing a set from a friend.

Then she suggested bartering for greens fees at a public course. Since golf is pretty no nonsense, I can’t even begin to imagine how this works unless the pro is there and the course is getting ready to switch from peak to off-peak hours.  And at private clubs, there typically aren’t fees unless you are the guest of a member and are required to pay. There is no bartering at all for this fee.  If you really want to save money on greens fees instead of bartering, play off season, play at off-peak times (weekdays or after 3PM or so on weekends), and walk, don’t rent a cart. You can also play an executive course (short, typically par 3 courses) for around $10 a round. Playing this type of course 4 times will still add up to less money than one round at a public or private course.

She did offer a good suggestion in looking for deals on membership dues. There are some clubs that will offer reduced price memberships for new members or if you pay your yearly membership in full. These deals are hard to come by but they are out there. You may have to compromise on what club you join or the type of membership you have but if all that matters is being able to play golf, then I say seize those opportunities. Also, if you’re under a certain age or a student, you can get a junior membership or pay reduced fees for a single round of golf.  You can also get a part-time job at a golf course (pro shop, working the carts, etc); unlimited rounds of golf may be a job perk.

Other suggestions for saving on golf: If you want to play at the really good clubs, look into different tournaments that are open to the public like charity tournaments or open scrambles. See if your company will sponsor a team to play in a tournament. Call and ask if you can use the driving range or practice putting greens rather than playing the course.  If you’re already pretty good, offer to give lessons (the members might bring you onto their course) or see if there’s a job coaching high school golf (again, giving you a chance to play at different courses); you’ll not only get to play but you’ll get to do it for free and make money.

Don’t forget that along with clubs and greens fees, you are required to wear certain types of clothes on golf courses. If these are not clothes that you normally own (collared shirt, khaki pants), you’re going to have to buy them (which you can do cheaply). Don’t worry about fancy golf shoes. They’re horribly ugly anyway. Before you run out and buy anything or borrow from a friend, but make sure you check with the course as to what’s appropriate attire. You may be able to pull something together from your existing wardrobe. Also, make sure you understand why you are buying something; this helps reduce the amount of gimmicky items like wrist bands you’ll waste money on. If it’s not necessary or won’t help improve your game, don’t buy it.

Golf is pricy. Period. If you want to pick up golf, be prepared to spend a lot of money. You can manage the costs but in the long run, golf is one of the more expensive hobbies you can have. From what I’ve been told it’s worth it. But I’d rather just go for a walk.

 

The debt is gone. Now what?

by Jana 20 Comments

The other day I wrote a post about grieving my debt. As usual, I got some great feedback from readers but one comments in particular stuck out for me:

Makenzie from The Random Path said “I can see how it would be strange to not have any debt and think “Now what”?”

It’s a great question, and one that I’ve been asking myself every single day. Now that I’m not funneling money towards credit card payments, what do I do next? Being in debt has inhibited a ton of goals and I have a lot of catching up to do. But where do I start?

Here are a few options:

  1. Retirement. My IRA has an embarrassingly low balance. So low, in fact, I’m not even going to tell you what it is. I have a small balance in my Fidelity account but it’s nothing to brag about. And I do have a pension through my government job but, by the time I retire, who knows what that’s going to look like. I really need to up my retirement savings and putting extra money towards this is at the top of the list. It’s just a matter of which pot of money we’re going to use to do it.
  2. College. My husband has massive student loan debt (granted, it’s not as massive as some people’s, but it’s large enough) and, after much discussion, we’ve decided that we don’t want our daughter starting out her adult life the way he started out his. In order to do that, we have to start putting a lot more money into her 529 than we currently do. The plan is to move the daycare payments (which end in June) to her college savings but there’s a situation that might be preventing that (stay tuned because next week, I’ll be venting discussing that). If the situation resolves itself, we’ll be sending a minimum of $350 to her 529 every month.
  3. New car. Eventually our cars will stop running and we will need to replace them. We don’t live in an area with spectacular public transportation and we’re planning on moving to an area that has absolutely none. So, we’re going to need our cars. Yes, cars, because my husband’s job will be over an hour away from our new house and I’m going to need to get around; sharing one car is out of the question. We’re lucky in that we have later model cars that are really reliable but you can only push a car so far. I despise having car payments so saving for new cars is critical.
  4. Down payment. We currently own our house (well, technically the bank owns it since we pay a mortgage but you know what I mean) and are planning on selling it very, very soon. However, because all of the other homes for sale in our neighborhood are actually bank-owned, our comps are terrible (yes, we were relying on money from the sale of our house to help increase our down payment). This means we won’t have enough money, even with what we have in savings, for a 20% down payment. So we’re going to have to rent for a year or two to build up that 20% savings. I really, really hate renting and want my own house again.
  5. Emergency Fund. We have the requisite, Dave Ramsey sanctions $1000 baby emergency fund (plus an extra few hundred). That’s it. It’s enough to cover most repairs (HVAC system, tires, etc) but it certainly isn’t enough to cover 3-6 months of expenses. Now that my husband has moved to a private sector job, it’s not as secure as his government job was and we need to be prepared in case something happens. He does have a very secure part-time job that would definitely help in the event of a layoff but it certainly wouldn’t be enough. We really need to build this part of our saving up.

It’s hard to prioritize which one is the most important. We have a finite amount of money coming in and we need to build up all of these savings buckets. On any given day, I’ll tell you that a different one should be the most important; it’s all very confusing to me and I don’t know where we should send our money (for the record, the husband is just as confused as I am).

Knowing that we need to do all of this is making me extremely anxious. I wish there was some sort of baby steps plan for savings (I realize Dave Ramsey touches on this but it’s really not specific enough). Maybe I should develop that.

What do you suggest I do?

Using your skills to find part-time income

by Jana 9 Comments

My little sister is a dancer. She’s been dancing for pretty much her whole life. It is something she loves and is extremely passionate about. In fact, she’s so passionate about it, it was her minor in college and she was on her school’s dance team for 3 years. Even now, she still takes classes to maintain her skills.

She’s been able to do something else with her love of dance. She’s been able to turn it into a part-time income. When she relocated after college, one of the first things she did was find a dance studio and now, she’s a teacher at that studio. She is also working on a business endeavor that will incorporate her love of dance into her current position at another part-time job (have I mentioned that my sister works full-time, has a part-time job, goes to grad school and has an active social life? Yeah, she’s awesome). For her, dance is a skill she’s been able to maintain and turn into a money making side gig.

There’s a lesson in my sister’s story: if you have a skill, it’s possible to use it and parlay it into a part-time (or even full-time) job. This is especially important if you’re looking for a way to increase your income for savings, debt repayment, or if you’re saving up for a ridiculous kitchen renovation.  It’s also a counterpoint to the argument “there are no jobs”. I agree; it’s way harder to find a job now than it was several years ago. So, as talented, skillful, creative people, I encourage you to go out and make your own job.

You might be wondering if I have any ideas or suggestions for skills or talents that can be turned into a part-time job. It just so happens that I do. Here are a few:

  • Music. If you can play an instrument or sing, you can have a part-time job. I had a friend in graduate school who taught piano lessons to supplement our meager stipend and my guitar teacher also had a day job. If you prefer not to give lessons, you can form a band and play various gigs. I have a friend who is a nurse by trade but is also the singer in a band. While the gigs may not make a fortune, people do buy their t-shirts and CDs and they do make money off of that. This is going to take some hustling and some self-promotion but it’s not impossible.
  • Education. If you are a teacher, you can offer your services as a tutor, either freelance or through a company. I believe there are also online tutoring sites. You can get a part-time job teaching religious classes (if that is in line with your beliefs, of course); my mom used to do this. For extra money, she taught Hebrew school classes at her temple. My only caution for tutoring through a company is to pay attention to how much the company charges the clients versus how much you get paid. If you’re getting screwed, you might want to think about branching out on your own.
  • Sports. There are opportunities abound for those graced with athletic ability. In my area, the school districts and sometimes even the local community colleges are always looking for coaches. I have a co-worker that umpires baseball games and a friend who is a soccer referee. My YMCA uses part-time staff to teach their group classes. My husband’s cousin was a lifeguard. Some of these options may involve a few dollars of investment in gear or certification, but the earning potential outweighs the upfront cost.
  • Art. I know several people who have been able to earn part-time income from their craftiness. One woman started a handmade purse business and another would make one of kind picture frames. They would sell their wares on Etsy or at craft shows or home shows, and were able to turn a profit. Other ways you can make money through your craftiness is to teach classes either at a local community center or YMCA or even at in-home parties. I’m sure there’s a market for kids’ birthday parties in there, too.
  • Cooking. If you have a talent for baking or cooking, you can sell homemade goods or start a birthday/wedding cake business. You can teach cooking classes.  Offer to cater small scale events. If you have a full-time job, this is a great place to start to drum up business.  And think creatively. Locally, there is a company that makes gourmet pet treats. It was a business that started in one of the owners’ kitchens. They peddled their goods and eventually landed an exclusive contract with the largest local pet store chain.

If you’re serious about any of these, make sure you do the research regarding business licenses, taxes, certifications—anything that may be potentially related to starting your own business (should you go that route). You don’t want to be faced with any problems that might crop up, wiping out all that you’ve saved.

I believe that even in the current economic climate (whatever that actually means), it’s possible to save money and get out of debt. I may be overly optimistic but I think that people need a dose of optimism. I look at it this way–even if you fail, you’ll still learn some lessons. And that’s not really failing.

What skills have you been able to use to create part-time income?

 

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