Jana Says

An open letter to high school students about debt

April 17, 2013 by Jana 14 Comments

Dear High School Students,

It’s me again. Jana, your friendly neighborhood personal finance blogger. I know you’re probably rolling your eyes at me (which is fine. I spent a good deal of my teenage years rolling my eyes at adults) but trust me, you’re going to want to pay attention to what I have to say. Because when I’m done, I will hopefully save you thousands of dollars as well of years of paying down debt (which is not fine. Paying down debt sucks more than first period math).

Remember how we talked about money skills you need to acquire and practice before you leave home to go to college? Those still stand and I still recommend them. But I also want to talk to you about a few things that will creep into your life and, if you’re not careful, can get very, very expensive. And not expensive in a good, iPad kind of way. No, this is expensive in a “I finally have a job and now all of my paycheck is going towards these things and I have no money left to do what I want so I’ll use credit cards again” kind of way.

What am I talking about? Alright, I’ll stop rambling and get to it:

Credit cards. Credit cards are a funny thing. People either love them or hate them; there’s very little indifference. For those who are in the love them camp, they feel that they are a great tool for using your money. For those that hate them, they feel that credit cards are evil and do nothing but cause debt. Here’s the thing: both sides are right. Credit cards do both. The difference is in how you choose to use them. If you get a credit card (and before you do so, talk to your parents or an adult you respect), read the terms of the offer very, very carefully. More specifically, scrutinize the interest rates, any yearly fees, late payment penalties, and how long it takes a payment to process. Also remember this: credit cards are not free money, although it may feel like it. If you use that card to pay for something, you will have to pay it back. If you don’t have a job or any way to pay it off, don’t get a card. Or, if you really feel like you need to have one in your wallet, get a very small limit and don’t use the damn thing. Using a credit card when you have no means to pay it back is a slippery slope that can cause more damage to your finances than you can imagine at this moment. Please trust me on that one.

Student loans. I will be the first to admit that I’m not the most appropriate person to give advice on this subject. But I’m going to do it anyway. Really, I just caution against taking out more than you need. I know many students see their loans not only as tuition assistance but as a way to afford room and board and have living money (my husband did this. As did a number of our friends), and while that’s your choice, I don’t think it’s the smartest choice. Like credit cards, you’re going to have to pay most, if not all, of that money back and having a high total will have a significant impact on your finances later on. If you can, try to find ways to supplement your loans: get a part-time job on or off campus; try a community college first and then transfer to a 4 year school (my husband did this, too); look into scholarships and grants (if you live in one of these 15 states, check out the Southern Regional Education Board); or, if you need to, attend school part-time. If none of those are possible, make sure you have a fantastic repayment plan for your loans (and explore all possible options) and you know exactly what you are getting yourself into.

Car loans. After spending your college years driving either a piece of crap car or not having a car at all, you’re going to want to buy a car of your very own. And you’re going to want it to be new and fancy and shiny and impressive. There’s nothing inherently wrong with all of those wants. The problem is that they cost a shit load of money. And your paycheck might not be able to keep up with the payments and the insurance costs (and the maintenance costs. And gas. And anything else). You might also need a co-signer for the car if your income isn’t enough to afford the car you want (even if it’s not the most expensive car in the world. My little sister bought a Toyota and needed a co-signer because her income was low); if you default on those payments, it’ll fall back on your co-signer and that’s not fair. So please, I implore you to pick a practical, new-to-you car that’ll be easy to pay off and, when you’re driving that car into the ground, you can set aside money for your dream car. Oh, right. If your friends make fun of you for your car, get rid of them as friends. Real friends don’t give a shit what kind of car you drive.

So that’s what I have for your today. I promise not to lecture you any more on your finances. I think I’ve given you enough to think about and consider. Now, please understand I’m not forcing you to do anything I’m talking about. How you choose to approach your money is your business. But before you make some expensive choices, think about it carefully. Because there’s a lot of life to live after you graduate and you don’t want your money tied up in debt.

Love,

Jana

P.S. Readers, if you have any advice to give to high school students, please leave it in the comments.

4 tips for handling setbacks

April 12, 2013 by Jana 9 Comments

Many of you know that I have begun my pioneer project. It's going…fine thus far. I've been mainly focused on two tasks: sewing and getting our garden started. The sewing is progressing nicely but the gardening is another story. Because, well, our plants are dead. Really, really dead.

We did everything we were supposed to do to get them prepped and ready for their containers (we have to container garden. HOA rules) and inside, they were kicking ass. Sprouting up all over the place. Nice and healthy. Anticipation ran amuk in my house with the bounty that we would produce. And then the plants got too big for their indoor greenhouse thingy, we transferred them to larger containers, left them outside in the sun, watered them every day and poof! They croaked. Now we have to start all over again. It's quite a setback in our gardening plans.

This has happened to us financially, too. Just when we thought we were getting on track, things happen. We needed 2 new cars in 6 months. Our HVAC system needed repair. The dog had to go to the emergency room. I stopped working full-time. Fortunately, this did not all happen at once but each time was a financial setback (thankfully we have an emergency fund but still, it does have to get paid back). Money back in to the EF meant money we couldn't use for something else like long-term savings or an extra payment on the husbsnd's student loans or contributing to the child's 529. Setbacks like this are maddening and frustrating.

Fortunately, setbacks can be handled with minimal damage to a relationship and a wallet. And they're not impossible to recover from:

Identify the cause. In order to fix the problem, it's important to figure out potential causes. By identifying those, you can start coming up with a plan to prevent it from happening again. In the case of our garden, we either transferred the plants too early or didn't use the right kind of dirt (soil. Whatever). So, when we start again, we know to keep track of dates on a calendar and go to a gardening center to get help for selecting the appropriate dirt.
Accept your role in the problem. For the most part, bad things just don't happen. Human error is involved either through mistakes, poor planning, or willfully ignoring a smaller problem that caused the larger one. Blaming others for your misfortune might make you feel better but it doesn't solve anything. Acknowledging what you've done makes it easier to adjust your behavior in the future. After our dog went to the ER last year, it was easy to blame him for eating the toys but really, we had to be better about supervising the child's clean up since we know Dobie is prone to this activity.
Make a plan. And stick to it! When a setback happens, it's easy to throw our hands in the air (and wave 'em like you just don't care) and quit. It's easy to fall into the trap of self-pity and say “why does this always happen to me?” And if you have to wallow in that for a few days, go ahead. But then snap out of it and formulate a plan to get back on track. Write down tangible, concrete goals with a timeframe. When we had to buy my husband a new car, we had just entered the land of no car payments and we were seriously pissed off. And we allowed ourselves to be. But then we devised a budget, a car shopping plan and a schedule for paying off his car early. What a great day that was, too.
Let it go. Once something bad happens, particularly when it comes to money, you have to let it go. Harping on the fact that it happened won't undo it; in fact, it'll just make the situation worse. I liken this to a baseball pitcher giving up a home run. None of them want to do that but it happens. But once the runner crosses home plate. It's done. Gone. Over. The next batter is a chance to start fresh and move on. Treat your setbacks the same way.

Setbacks happen to even the most careful, meticulous planners. You could have the most detailed, specific debt repayment plan ever created but one day, something might happen that throws all of it into a tailspin. And that sucks. But you can let one misfortune derail all of your hard work. Learn from the situation, readjust, regroup, and start over (even of it sucks). And remember to tell yourself that this setback is only temporary and eventually, you'll reach your goal.

Readers, how do you handle financial setbacks?

Inexpensive techniques for lifting a bad mood

April 10, 2013 by Jana 14 Comments

Ever feel really crappy to the point of not wanting to get off your couch, not wanting to talk to anyone, not wanting to shower or even wear clean clothes? Me, too. And it sucks. A lot. Especially when it's hard to explain why you feel so awful when, on the surface, it doesn't look like there's anything to feel bad about. But it happens and we have to live with it.

Moods like that are hard to break. Believe me, I've tried. And over the last year, I have worked hard developing techniques and ideas to prevent that from happening again. Since we have a one-income budget and money doesn't flow as freely as it once did, I've devised some free and inexpensive ways to snap my bad mood when they happen:

Browse Pinterest. I realize this can have the reverse effect, particularly if you spend time browsing all the perfect homes and crafts and fashions. So don't do that. Instead, browse the animals section for a dose of fuzzy cuteness (this is my personal favorite section) or the humor section for a good laugh or inspirational, uplifting quotes. Create a board of all of your favorite feel good pins so the next time you're feeling bad, you have them all in one place. Or make a collage of your favorites, print a copy and hang it around your house or desk at work or wherever you need it.

Exercise. When my depression was diagnosed, my therapist mandated that I exercise in conjunction with my therapy and meds. And I can tell you, when I exercise regularly, I feel so much better. If going to a gym is too expensive, look for free classes in your community or find cheap, one time fee drop in classes. Or get outside and walk in the park or your neighborhood. Or rent an exercise DVD from the library or use Pinterest or YouTube to find routines you can do at home. Even 15 minutes is enough to make a difference.

Create. There is just something therapeutic about creating something. Not only does it take your mind off of what's bothering you but it boosts your ego a bit when you've finished the project. You can sit back and say “hey, I made that” and honestly. it feels great to say that. Instant mood lifter. It doesn't matter if it's something as simple as coloring a rainbow or paint by numbers or as sophisticated as cooking a gourmet meal or composing a song. When you're feeling down, tune into your creativity and indulge it. It doesn't have to be fancy or expensive either. A pen and the back of an envelope are enough.

Rest. Sometimes the stress of daily life gets to be too overwhelming. There are chores and errands and work and family obligations and bills and so many other stressors that after awhile, it takes its toll on a person. With all the demands on our time, and the desire to do it all perfectly (is that just me?), it's no wonder we're all so anxious and depressed. If you're feeling like this, give yourself permission to rest. Take a day off. Let the laundry go another day. Eat cereal for dinner. Go to bed early. Say no to plans. Nothing cures a bad mood faster than a good day's (and night's) rest. And, as an added bonus, it's free!

Make a gratitude list. There is no better way to feel shitty about yourself and your life than to compare it to those whose lives you perceive as perfect. Yes, there are people who are richer and in better shape and have a nicer house and more money. But so what? That doesn't devalue your life, home, health or anything else. When you're feeling down, make a list of 10 things you are grateful for; it doesn't need to be a list of material things. Anything you are grateful for will do. When you're done, take a few moments to reflect on what you wrote down. It'll encourage you to feel better (even when you don't want to).

As someone who has to work hard at being happy and feeling good, I employ these techniques often (but within reason). They really do work, and the effects last longer than a day at the spa or shopping. Because while those provide momentary relief, when they're done, that's it. There's no more. And then there's the whole dealing with the amount of money spent which causes more stress and depression and kind of defeats the purpose.

Readers, what are some inexpensive activities you engage in to help lift your mood?

5 workplace sins (and how to fix them)

April 8, 2013 by Jana 17 Comments

Work. Most of us have to do it, and many of us have to work for other people. It’s not ideal and often, it’s not fun. As a result, we find ourselves committing one (or more) of these workplace sins:

Ignoring deadlines. Almost all jobs come with this little quirk. Supervisors and managers actually expect you to finish your reports and tasks by a certain date. And on time, too! While we, as workers, may question why these deadlines are in place, there’s usually a good reason behind it. Those reasons can be federal compliance, corporate rules, or pressure from your boss’s boss. Whatever it is and however ridiculous we may think those deadlines are, a surefire way to get into trouble at work is to chronically miss deadlines. It’s a very passive aggressive act of defiance and, if it happens often enough, it can cost you a promotion, a raise, or even your existing job. It’s also rude. Quick fix: If you want to make your boss happy, and your workday easier, meet your deadlines. It’ll prevent your boss from bothering you too often.

Dressing inappropriately. I’ve covered this topic before but it’s worth repeating. You need to dress according to your environment. If you’re a stripper, the less clothes the better. But if you work in an office environment or a school or a store or a warehouse or somewhere that you do not get paid to take off your clothes, you need to adhere to your workplace’s dress code. Ignoring that dress code is also very passive aggressive and believe me when I say that management takes notice. And not only will you get punished, but your co-workers will get the wrath of management as well. That’ll make people not like you and cause your work day to be quite unpleasant. Quick fix: Dress the way your work says, even if it’s a horrendous uniform. Change as soon as you get home. Or before you leave the building after your shift is done. But suck it up during work hours.

Arriving late. Getting to work on time is hard, particularly if you have children or take public transportation to work. Having to adjust to someone else’s schedule is awful. Trains, buses, traffic, and toddlers are all very unpredictable. However, if you know that these factors are present in your life, you need to make accommodations. And in a number of companies, particularly retail, chronic lateness is probably the best way to get fired. Quick fix: Get up earlier. Get your kid up earlier. Take a different route. One tactic that worked for me (yes, I had a horrible chronic lateness problems at one of my jobs. I admit it) was to talk to my direct supervisor and adjust my schedule. By making a simple 15 minute adjustment on both ends of my day, I stopped being late and everyone was happier. If you’re running late, try to give them a call and let them know. Courtesy goes a long way.

Abusing your leave. Who doesn’t love a good day off in the middle of the summer when it’s perfect beach weather or in the dead of winter when it’s just too cold to leave the house? Who doesn’t take the occasional mental health day on a Tuesday because Tuesdays suck and getting a manicure is better than writing another report? I’m not going to lie to you…I did all of those when I worked my full-time office job. And I feel absolutely no remorse for doing so. It was my leave, I earned it, and I felt that I could use it how I wanted. However, I never abused my right to take unplanned leave. But there are a number of workers who are not that honest. If you’re one of them, it will catch up to you. I’ve seen it happen. Quick fix: If you want to take vacation, or a mental health day, just put in an advance request for it whenever possible. When it comes to this, honesty really is the best policy. If you or someone in your family have chronic health issues, discuss the leave for this with your supervisor.

Having a poor attitude. Do you hate your job? Do you treat your coworkers and customers like crap? Are you always angry and rude on the phone? Does the quality of your work suffer because you think your boss is a dumbass who gives you tasks beneath you? Have you been called into your HR office to discuss all of these issues? Does everyone hate you? If so, maybe you’re in the wrong job for you. But if you can’t easily walk into another position or field, you need to learn to keep your poor, resentful and disrespectful attitude in check. Making others around you unhappy is bad for business and it’s bad for you. I’ve worked in jobs I can’t stand and I’ve done my fair share of complaining about them, both at work and at home. The negativity is infectious and will ruin every aspect of your life. Quick fix: Do whatever you need to do to get through the day (short of showing up intoxicated. This only works on Mad Men). I don’t advocate a live for the weekend lifestyle but if that’s what you need to keep yourself positive (and employed), use that as a way to keep yourself going on those days where you want to scream at everyone.

While it’s impossible to be perfect at work every day—we are human, after all, and humans have bad days—it’s important to conduct ourselves as professional as possible on as many days as possible. Not doing so is a drain on you, your company, and the productivity and profits of your workplace. But if you find that nothing you do is making your job bearable, and you just can’t stop yourself from committing these sins, then maybe it’s time to look for another place of work. And there’s no shame in that. Not every job is meant for every personality.

Readers, what are some other workplace sins that you or your coworkers have committed? How have you fixed them?

Business lessons from Strawberry Shortcake

April 5, 2013 by Jana 7 Comments

As the mother to a very girly-girl, we spend large amounts of time doing girly things. This includes watching girl-focused cartoons like My Little Pony, Tinker Bell, Sofia the First, and, my personal favorite, Strawberry Shortcake (this has nothing to do with the fact that I loved this cartoon when I was a kid). And I promise, I’m not being sarcastic.

Strawberry Shortcake and her friends, while disturbing on some level with their cankles and very large feet, are one of the more positive influence I’ve seen for girls. Not only do they look like little girls rather than little girls pretending they’re adults, they have a number of personality traits that I find positive. First, while they do not always get along, there is no bullying and they are able to work out their problems civilly. Girls need to learn that. Second, these are very confident girls. They believe, and sing about it quite often, that they can do anything they put their minds to, not matter how difficult the quest may seem. Girls need to learn that, too. And third, they are all very entrepreneurial. Every character not only has a job, but she owns her own store.

This is the part we’re going to focus on.

Listen to your customers. There was this one particular episode where Lemon Meringue, the town cosmetologist, gave all the girls manicures with singing, sparkly nail polish. While everyone loved it at first, it became quite bothersome to constantly listen to singing nails. Lemon thought everyone was avoiding her but really, they didn’t want to hurt her feelings that they hated her product. She finally talked to them and, through a very honest (and civil) conversation, she received good, positive feedback on how to improve the product. Takeaway: every once and awhile, survey your customers. Assess how you’re doing, see where you can improve, what they’d like to see offered, and actually implement their opinions whenever possible.

Specials are good for business. The general store owner, Orange Blossom, had this great idea for a spring sale. She asked some of her customers (see point above) what they love most about spring. Based on that information, she created special spring bouquets and fruit baskets that she sold at a discounted price to all the residents of Berry Bitty City. Her special was such a great deal that she had a line out the door, but, coupled with that, she also offered a quality product that made her customers happy and allowed for repeat business. Takeaway: Offering discounted and special pricing on your goods and services will get people in the door. However, you have to put out a quality product in order to receive continuing and loyal customers.

Live your passion. All the girls love what they do and it’s obvious by the way they dress, talk, and the ideas they present at group project meetings (these girls work together on a number of projects). In fact, they live their passion so much that it impacts how they treat each other at times. For instance, when they gave each other secret gifts for the Glimmerberry Gathering, Blueberry Muffin (my personal favorite character. Just saying), the resident bookstore owner and writer, gives a very large book as a gift. However, the book is about organizing books. Blueberry gave the book she wanted to receive. It sounds selfish but really, she just loves what she does so much that she had trouble realizing that not everyone loves it that much. Takeaway: If you want to be successful at what you do, you have to love it. You have to be passionate about it. You have to be willing to learn, practice, and live and breathe it for large parts of the day. But don’t forget that not everyone feels that way. You don’t want to frighten your support system away.

Help other small business. Strawberry Shortcake and her friends all run their businesses singlehandedly. They have no staff, no bookkeepers, no marketing people; they do it all themselves. However, they occasionally run into situations where they need help (actually, this happens a lot. I think these girls need to get better at time management) so they turn to their friends for help. It works out well for the person in need and the other business owners get a good reputation for being considerate and good hearted. That kind of reputation is good for profits. Takeaway: If you own a small business, consider partnering with another small business for a charity event or fundraiser. Share a table at a community event day. Sponsor another small business in a golf tournament. Do something, however small, to help that business. It’ll help build your network and your visibility.

Take chances. So Strawberry Shortcake’s favorite pop star is Cherry Jam. She finds out that Cherry is performing near Berry Bitty City and she would just love to have Cherry perform at her café. Strawberry desperately wants to ask her but she’s too nervous. So her friends, wanting to help her out, send an email to Cherry Jam and lo and behold, she not only responds but she agrees to give a concert. It was a risky move but the girls didn’t seek to gain anything by not asking. Taking that chance could have failed but it was worth a shot. Takeaway: When running a business, you have to be willing to take chances and risks. Hey, just by starting a business you’ve taken a great risk! Why not continue by trying to sell a new product or write a book that’s a little out of your comfort zone? Even if it fails, you’ve learned something.

If you told me a few years ago that I could learn anything valuable from a kid’s cartoon, I’d have laughed in your face. It’s a cartoon! They’re mindless and fun, and kids love them for that reason. But while they’re entertaining, if you pay attention, the lessons (in some of them) are quite sophisticated. Strawberry Shortcake and her friends really are very enterprising little girls and honestly, I’m not too annoyed that my daughter loves to watch their adventures. They’re colorful and good role models.

And one of them owns a bookstore. That’s awesome.

P.S. In the spirit of these lessons, I am offering a 30% discount on all of my consulting packages for the rest of April. Make sure you book yours now!