Jana Says

Are your financial prejudices fair?

August 31, 2012 by Jana 10 Comments

I’ve talked before about how, when I first started taking Zumba classes, I had to get over my embarrassment and trepidation of starting by realizing that I just didn’t care what other people thought. I also mentioned that, when you’re paying off debt, it’s imperative to have that same thought process. And I also talked about how we need not pay attention to what all of the other, more coordinated and experienced people think of us and how they probably admire us just for stepping into the room.

I still believe that.

But I also believe that prejudices about exercise, and money, work in reverse. For all of the people we think are out there judging, commenting, and developing their own versions of our backstories, we (and by “we” I really mean “me”) are doing the same. See if this situation doesn’t sound familiar:

After mustering up enough nerve, and finally finding the right clothes that do not accentuate every single bit of fat on your body, you walk into an exercise class. You take your necessary place in the back corner, far away from the prying eyes of the well-toned, clearly coordinated women wearing what you only would wear in the privacy of your own home (as long as no one else was there and it was laundry day, meaning all of your comfortable, loose fitting clothes were dirty) and the even more well-toned and ferociously energetic instructor. As you self-consciously look around at the rest of the class, waiting for your 60 minutes of much needed torture to begin, you start to think about how all those women (and men, too) are so fit and can probably never imagine what you’re going through. The failed diet attempts, the agony of clothes shopping, the self-berating that comes after you have both wine and dessert; these people could never possibly understand that.

Or could they?

Upon further research, particularly when you’re looking for Zumba classes near say, I don’t know, a conference, you learn that the most enthusiastic, high-impact, energetic instructor you have ever had recently lost 100 pounds. Then you learn that your favorite instructor dropped 8 pants sizes. And your other favorite instructor has lost close to 80 pounds. Then you find out that, among those skinny moms who look like there’s no way they just had a baby, more than one of them have also lost a substantial amount of weight.

Then you feel like an asshole for judging them so harshly in the first place.

Those of us who’ve battled debt often do the same thing to people who look like they’re financially comfortable. We see them with their new clothes, taking vacations, and generally enjoying life while we sit in on our old furniture, watching another movie from the library, eating leftovers and we can’t help but hate them. We can’t help but imagine the most horrible things: they’re worse off than we are but are putting on a good show; they’re so lucky to have no debt; I wonder who paid for them to do that. However, what we don’t see is that in some of those cases, they’ve come into money under terrible circumstances like the death of both parents. What we don’t see are the struggles that some of them went through to make it through college debt free or to pay off tens of thousands of dollars of debt. What we fail to remember is that yes, some people are lucky to be born with a great bank account and helpful family members (or a great metabolism) but many of them did not.

They put in the time, work, and effort required to manage their money and pay off their debt. They learned, whether at an early age or later in life, how to live on a budget and not spend more than they make. They took the initiative to control their impulses or, if you’re some of the people I know, find a career that they not only enjoy but is incredibly lucrative and put in the long hours studying and working to become excellent in those fields. The bottom line is that the people we view as successful and better off than us have, most likely, been right where we are now.

So it’s time to put away the hate (okay, fine, most of the hate) for those people. Start using them as inspiration to achieve your goals. Talk to them. Learn what they did to get to where they are. Ask if they’d be willing to help you in your journey. I think you’d be surprised at the response.

And, if they say “no” or something really mean or inappropriate, I give you permission to create the most awful story about them ever and then share it on Twitter.

Words with Friends made me smarter about investing

August 30, 2012 by Jana 12 Comments

In a few weeks (hopefully sooner), I’ll be debuting a series on investing by a new blogger who’s generously offered to teach me and the other investing ignoramuses all about the foundations of investing. I’m really looking forward to this because it’s definitely a facet of personal finance that I just don’t get but need to. Because, you know, it’s kind of important if I want to have money later on. That’s not just from savings. So I’m totally stoked for this series.

In the meantime, I wanted to share that, although I still sit firmly on the “I don’t understand investing” side of things, I have picked up a few tips since I made that confession. Before you investing smarty pants get all excited that I learned this information from legitimate sources, let me assure that I did not. No. I learned about investing through…Words with Friends.

Seriously. I did. I’m not joking.

Perhaps Words with Friends is not the most traditional place to pick up information about investing. But it works for me. And I should state that I still can’t tell you what an index funds is or why mutual funds are a good idea or if those two are even the same thing. No, what I can tell you that what I’ve learned is more generalities. And that’s pretty much all I need to get by (well, probably not but it works for me).

So what have I learned that has made me so smart? Well, let me share:

Hope you get the right letters

In Words with Friends, you don’t really have much control over the letters you get. But you hope that, after you play a word, the random letter genies give you good letters so that you can make actual words (and play them on the double and triple words boxes) for big points. You want to keep amassing those big points, with the help of some strategically played “Z”s and “J”s so that you can obliterate your opponent while being able to show off about the huge score you pulled. Or, you can resign because you keep getting letters that create no words or puny words like “or” and “if”.

Picking stocks works the same way.

Since each publicly traded stock is assigned 3 letters (I think), and you pick those letters based on what I assume is careful research (or, if you’re like me, which companies you like. Or by just looking at a page and picking whatever your finger lands on), you put your money on the fact that those letters are going to pay you big dividends. Those big dividends then line your pocket and you get to brag to your friends or anonymous strangers about your ability to cash in on those three letters. You can also be extremely disappointed at their return, and realize that you banked on the wrong letters, and you hope you can keep quiet about your poor letter picking ability.

Be strategic

When I get good letters while playing Words with Friends, I try to hang onto them as long as possible so that I can play them in a good spot. I’ve even been known to skip a turn, hoping that my opponent plays his or her word in the spot I’m psychically willing them to so that I can then play my letters where I want. Like most players, I will try to build words off of double and triple letter/word boxes, hoping that this strategy will allow me to win. I have other strategic moves but I don’t want to give them away just in case we ever play each other and then you’ll know what I’m doing and how to build a good offense or defense and then beat me. But know this. Before you play a word, I already know what my next move will be. And I have a back up move in case you ruin my plan. I must have a strategy because that? Is key if you want to win at Words with Friends.

Just like it is with investing.

Those who play the stock market also have a strategy. From what I’ve gathered, they pay attention to the price of stocks so that they know when to buy or sell or whatever else is possible to do with one’s shares. They have a strategy for which stocks to own, which ones to avoid, and which ones to gamble on. Keen investors have a strategy when picking where to place their money. They know when a potential purchase of a business or real estate property or whatever else they’re going to spend their money on is a smart move or one that could end up in either huge disaster or gigantic payoff. But before they do it, they develop a plan for how they’re going to make the most money from their investment. It’s the smartest move they can make.

Keep track of what you have

During a game of Words with Friends, I obsessively check my letters. I want to know what I have, what words I can make and when I need to swap or pass on my turn. By keeping track, I’m able to develop that all important strategy so that I can, hopefully, avoid losing. I need to know what’s going to get subtracted at the end so, in the event of a loss, I know how bad it’ll be. I don’t like to lose and I certainly don’t want it to happen because I did a poor job of tracking what letters I can use where.

In investing, it’s important that you know where you’ve invested your money. You need to remember if it’s in stocks or bonds or properties or a friend’s doggie shoe business. You need to track how much you’ve put in to each investment, how much of a return you’re getting, and whether you need to make adjustments so that your money is working for you at its maximum potential. And, most importantly, you need to make sure that you have enough set aside to pay your taxes on those dividends and interest. Because if you don’t track that properly, you could end up sharing a cell with Wesley Snipes.

Be patient

Sometimes, when I’m playing a game, I really, really want a letter so I can make a stellar, high point word. And that letter takes forever to show up. Or it never shows up at all and I have to readjust my game plan. But mainly, I just need to sit back, be patient and wait to see what happens. This patience is key to a successful game plan (and so is a little luck, but luck is a tricky subject and this post is long enough already). Or not. It depends on the game.

Such it is with investing. Often, we don’t see the results we want right away and it causes massive anxiety (well, I’m assuming it does). We see the ups and get excited; we see the downs and want to bail. But what we really need to do is be patient, wait it out, and then make an informed, careful decision. From what I gather, if you’re patient and ride out the storm, your investments will pay off big time. Unless they don’t. In which case, you can pride yourself on not making a rash decision but being angry that you lost money. Because that’s totally fine.

So that’s it folks. Thanks to Words with Friends, I’m just a little bit smarter about investing. Which is probably good for my bank account and my eventual retirement.

My kid’s love of swimming could help her financial future

August 29, 2012 by Jana 7 Comments

My husband and I often say that we’re going to take our daughter, find what she’s good at and exploit that skill until she’s made us so wealthy we can afford to retire from our jobs and do whatever we feel like doing.

Clearly, we’re kidding. We’re not that cruel.

But underneath the joking, there is a valid point (I swear. Stick with me for a few more sentences and I’ll get to it). We want to encourage our daughter to explore and find what she’s good at because, in the long run, you never know how it can pay off.

For instance, my sister has been a dancer for most of her life. She was on her college’s dance team, she’s found part-time jobs teaching dance and now, she hopes to combine her love of dance with a graduate degree and create a full-time job. Yes, our parents spent money on costumes, lessons, and everything that goes with it, but a passion and a talent have turned into a potential career. Which means that the money spent will pay for itself in the long run. So I figure, why can’t I do that with my daughter?

At this point, she’s only 5 ½ but she’s already demonstrating a love and an aptitude for swimming. For a kid who was afraid of water up until a year ago, she has taken to water like, well, a fish. She loves to swim (in fact, I’d say 75% of my summer was spent at a pool) and she’s actually quite good at it (which, incidentally, works out well because she wants to be a mermaid when she grows up). We’re okay with this as an activity because a) of the sports, it’s one of the healthier ones ; b) it’s less expensive than many of the other activities she could have chosen; and c) it’s a life skill. As a bonus, my husband and I both love swimming so it’s something we can actually help her with (as opposed to something like gymnastics or dance or ).

Everyone wins. Especially my daughter’s bank account.

We figure that, on top of swimming being a great, healthy exercise, it’s something she can possibly use for her financial gain in the following ways:

College scholarships. Many schools have swim teams, and many schools will pay their athletes to attend the school on a swimming scholarship. Assuming she remains as interested in swimming as she is now, and she develops her skills enough (which I believe she will. She wants join a “practice” team once she’s 6), there is a chance that she could obtain a scholarship to swim for a college. This means a few things: we get tuition help, she won’t have to take out loans, and she’ll get a really awesome opportunity to participate on a college team.
Summer jobs. And jobs during the school year. Her swim lessons are taught by college students, many of whom also double as lifeguards at our pool during the summer. This is a fantastic way for her to have a job doing something that she would be doing anyway—swimming. I’m not sure how much lifeguarding pays because it’s not something that I ever had the desire to do but for high schooler or college aged kid, the money is probably nothing to sneeze at. Having this kind of job will teach her responsibility, first aid, what it feels like to earn a paycheck and she’ll probably have fun. So that all works out well.
Entrepreneurial skills. Following in her aunt’s footsteps, there’s a chance that she can use her love of swimming into her own business. The soft skills that she learns from swimming like setting goals, showing up on time, self-discipline and hard work, working with other people to achieve an outcome, are essential to every entrepreneur. And, with her love of water, she can be a freelance swim instructor, open her own kid-friendly swim academy, do water therapy (I’m not even sure if that’s real) or a variety of other jobs that will a) pay the rent and b) give her income.

Of course, these grand plans are entirely contingent on her keeping up her love of swimming. Quite frankly, I’m not going to force her to do any activity she doesn’t enjoy regardless of the financial impact it might have on her in the future. I’d rather be broke than have my kid resent me for making participate in something she hates.

Money Tune Tuesday: Summer’s over edition

August 28, 2012 by Jana 3 Comments

Today marks both a beginning and an end.

Today, my child starts kindergarten (and yes, I’m very emotional. I don’t want to talk about it. That line makes my therapist very happy). I haven’t mentioned it much here but, despite our initial intent to put her in private school, the fact that I kind of went crazy, left my job, and decided to attempt to be a writer meant that our funds are now…diminished. We’ve been meeting our basic expenses but there’s not a whole lot left over for over $8000 in tuition for private school. And she made it to #4 on the waiting list for our charter school. As a result, and after extensive research, my daughter will be entering kindergarten in public school. I’m very comfortable with the school, it’s reputation and the bizarre coincidence that the principal and my husband are fraternity brothers.

So there’s that.

As far as the end, it marks the end of the daily assault on my ears. Staying home with my daughter has presented a number of challenges. And none of those challenges were more difficult than having to listen to the same 5 songs. Every. Single. Day. Multiple times a day. When this first started, the songs didn’t bother me. Now? I hate them. I don’t want to listen to them ever again. Ever. Not even in Zumba where my taste in music is substantially relaxed and I actually enjoy songs I normally wouldn’t.

So, to celebrate my ears being released from their auditory hell, I’m going to share some of those songs. I’m considering it their final send-off before I sent them into iTunes prison (which, incidentally, is next to the prison that holds comments from people like Average Joe from The Free Financial Advisor and Shannon from Ready for Zero. I’m strategic like that).

Feel free to click away and not punish yourself. I promise not to hold it against you. In fact, I’ll probably respect you more.

An open letter to the McDowell family

August 27, 2012 by Jana 11 Comments

Dear Samuel, Jack, Mary, and the rest of the McDowell crew whose names I can’t remember because there are just too damn many of you,

You don’t know me but I feel like we’re old friends. Before you start freaking out and thinking I’m some sort of weird internet stalker, let me assure you that I am not. Actually, now that I really think about it, the reason we’re so intimately acquainted is your fault. How’s that, you ask? Let me tell you.

You won’t stop using my phone number. Which has actually been ours for the last 8 years. When we moved into our house. Yet this fact has somehow escaped you because for the last 8 years, dozens of debt collectors that have called our house, repeatedly and at various hours of the day, look for your entire clan because at one point you did have our phone number and I’m pretty sure you’re still using it to avoid the situation you’ve placed us in. And I’m getting pretty damn sick of it.

I’m sure you can’t imagine how it’s annoyoing seeing as how you’ve effectively avoided debt collectors successfully for the last 8 years but I feel that it’s important to share with you just what it is about this situation that’s infuriating since you’re clearly unaware.

First of all, do you know how annoying it is to come home almost every day for weeks at a time to 16 missed calls on your caller ID (let’s pause for a moment for you to question why I even still have a landline. I’ll tell you that it’s really none of your business), as well as several nasty messages from said debt collectors imploring us to call them back because it’s an urgent matter? Wait, let me answer that question for you. No, you don’t. Because you don’t give your real damn phone number. But I can assure you that is about as maddening as having to constantly tell people you don’t know who the fucking McDowells are and have them not believe you so they keep calling back until you yell at them. Which I really don’t like to do but I don’t have a choice. So now I’m also angry with you for making me be mean to strangers (and, let me clarify, you people are not strangers to me. No, I feel very well acquainted with all of you).

Second, not ever in my life have I been sent to a collections agency. Even in the thick of my debt, I always managed to pay the minimum so as to avoid this exact problem. I don’t like to be harassed (unless it’s by Wentworth Miller or Jason Segel. In that case, harass away, boys) and this is especially annoying because it’s not my debt. If it were my debt, I could manage the harassment; I wouldn’t have a choice considering I created the problem. But again, it’s not my debt. Or that of a family member. Or a close friend. Or someone I was friends with in the 5^th grade. Debt collectors calling me for those debts would make some amount of sense. But for you? It’s just a bothersome pain in the ass. Seriously, McDowells, pay your damn debts and get these people off my back.

Third, I don’t want to know these things about you. I really don’t. I’m nosy but someone else’s personal financial disaster and ruined credit? Not something I care to know about. For a bunch of reasons, including the fact that it just makes me sad. And I don’t like to be sad over information I never needed in the first place. Including your health issues. Yes, McDowells, I know all about the cancer scare and the fact that Samuel needs more blood work. Why do I know this? Because you’re giving people our phone number and clearly people are idiots and don’t listen to outgoing messages so when they hear my family’s name they think it’s yours and they leave a message! If you want to keep this stuff a personal, family only matter, the solution is simple. Give your correct phone number!!!

At this point you’re probably wondering why we haven’t changed our phone number. We thought about it but then realized that would inconvenience us even more than your debt collection phone calls and it just wasn’t worth it. Besides, we’re not the problem. You are. Why should we need to do all the work?

You will be happy to know that continuing to use our phone number is not, in fact, fraud. I know this because I spoke to the police. So once again, you’re going to get off scot-free. And that completes the circle of annoyance.

In conclusion, McDowells, I’d just like to say two things: one, thank you so much for the years of annoying phone calls, harassment and general displeasure at answering the phone; two, I hope you take care of this situation because if there’s a generation of little McDowells out there, you’re setting a really bad example.

And you should be ashamed of yourselves.

Love,

Jana

P.S. If you’re wondering how any of the debt collectors tracked you down in Florida (if you’re even still there), you’re welcome. You should have changed your phone number with Best Buy, too.