Money Reasons

Smart Reasons to Save, Use and Invest Money

Archive for October, 2009

Re-Using Printer Paper At Work

October 22nd, 2009

A few months ago, when I was walking by a fellow prisoner, erh… cube dweller, I noticed that he had a stack of paper that was about 1 foot high. I was perplexed… what was it for? So I asked him, he told me it was scrap paper. I thought that was a pretty good idea. But wow, 1 foot high… hmmm.

So I decided to build on his idea. I’ve collected used printer paper (that is in good shape) in a pile like my buddy’s. But instead of using it just as scrap paper, I decided to use it as a daily log. Instead of staples, I’ve been using a metal clip to hold the papers together in groups of 5. Then when I am finished for the week the daily log represents, I punch holes in them and put them in a notebook folder.

Getting more out of used printer paper

After a month, I’ll start to purge them from the folder and throw them in a recycling bin.

-D

2 comments »

Posted in Frugality

Kids Allowance Amount

October 21st, 2009

I decided to start a weekly allowance for both of my kids after they had their 5th birthday. I basically decided to keep it simple. I just give them $1 for each year of age ($5 for my 5-year-old, $9 for my 9-year-old).

Depending on how well I’m doing financially on down the road, I might increase the amounts for both kids once they reach a certain age. Maybe something like this:

Age	Allowance
1 thru 9	$1 for every age year
10 thru 16	$1 per age + $5
16 thru 18/21	$1 per age + $10

So: if my son were 12, then he would get $17 weekly.
if he were 17, then he would get $27 weekly.

I marked “18/21” in the table above, because I haven’t decided yet when to stop providing an allowance to my kids. I might also increase it to $50 once they start college. I’m not sure, It’s still up in the air on that one too.

Update: My son is now 11 years old as of 2012, but I forgot about the extra five dollars I was going to give him. Quite honestly though, money has been tight for me lately, so I might delay that increase until he is 13, 14 or 15. At Age 16, I will make sure he gets the extra $5 plus his age.

Hope you enjoyed my model,

-MR

8 comments »

Posted in Kids

Tags: Age Based Allowances Allowance Allowance Amount Allowance amount for kids at certain ages Allowance Amounts for kids Kids what I give my kids for allowance

Investment Losses

October 20th, 2009

Well, we are finally in the 4th quarter of 2009! Time to start looking at any losses in our brokerage accounts (this past year was bad for me, too many high beta stock). Beta is the risk factor the stock is rated at, 1 being average risk, and anything higher than 1 being more risky.

If your losses are greater than you gains, you can take the losses as a deduction against your earned income but only up to $3,000 worth. The amount over $3,000 will have to be taken against future years gains (or it’s also possible to take it against past years gains, but that’s a bit more tricky).

Hopefully, you don’t have any wash sales (I’ll explain this in a future post)…

As for me, I won’t be taking any losses, at least not this October or November. Depending on how the market does in December, I might cash some stocks in. Most likely, I won’t even cash out then either. I’ll wait until next year to consider losses. I don’t like to sell low and buy high…

Hopefully, the market and labor market will be back fully back on track sometime in 2010.

-D

No comments »

Posted in Investments, Taxes

Navy Shower

October 19th, 2009

Showering the Navy way…

Navy Shower

This summer, I started showering the Navy way. Ironically, I didn’t know it was called that at the time. I was showering, and thought “Wow, most of the shower water is being wasted and that I could reduce my water usage”.

Here is What I Did:

So I started to soak myself, turn off the water, scrub down, then turn the water back on to wash away the soap and shampoo. I cut my water consumption by about half. Later, after I got a rhythm, I was able to cut my water usage by at least 80%. I’m sure it’s possible to achieve a better percentage, but this was fine for me.

At the time, I thought it was pretty clever and I told one of the older guys at work… He said “So you took a Navy shower huh”. I googled it, and apparently, that’s almost exactly what I did.

A Navy shower is one where you:

Soak yourself
Turn the water off
Lather up and scrub
Turn the water back on, and rinse
Dry

My buddy (a Navy man) told me that the fresh water stored on the ship was a limited supply. And apparently, to conserve the fresh water, everybody would follow the technique above to save as much water as possible.

Practicing such a technique will:

Save you money (less water waste)
Conserve water (better for the environment)
Keep water hot for the family (nobody likes a cold shower)

What a great way to get more bang for your buck! You (and your family) will benefit 3 ways all at once.

I don’t practice this on very cold winter days, although, it’s a great way to wake up! Coffee is overrated anyway… ;)

Another debatable perk is… After doing this for a while, taking a nice regular hot shower is a treat, almost a luxury. I now make sure I take a regular shower at least once a week just to reward myself and enjoy it!

Anyway, that’s my 3 cents for the day!

-MR

5 comments »

Posted in Frugality, Ideas

Walking Away From Debt

October 17th, 2009

Rich defaulting on their mortgages

I read an interesting article on msn.com today (Click Here for the msn article) about the rich walking away from their mortgages. Some are even double dipping, they stop paying on their mortgage and if they have a line of credit, sometimes they pull all of that money out too. The msn article calls these defaults, “strategic defaults”. In California, the strategic default cases increased by 68 times from 2005 to 2008 (not percent! times… WOW)

What if you lived in an area that had a financial perfect storm kind of occurence?

Okay, what if you do live in one of the real expensive areas of the country (parts of California, Florida, etc), where the value of your house has lost more that half? What if you find a house that is a bigger better house than your, and it was in forclosure in a great area, and discounted by 50%? So now you have the possibility where you can buy a bigger better house for less money than you paid for yours… And one that will probably double in 5 years when all of this mess is behind us (hopefully…). That can be pretty tempting!

Hmmm, the financial logic is: I’ll buy that bigger house in the more prestigious area that was forclosed on for half price it was originally, then let my house go into forclosure. If after 5 or so years, the house market recovers, they gain on the uprise potentially doubling their money. And if the house doesn’t appreciate that quickly, they are still in a better area than before, possible with a better school system. Only the banks lose out, wow, that is tough. I live in an area where the houses didn’t fall much in value, so the people in my area are not presented with that immediate temptation.

Depending on the amount saved in such a transaction, that could be a big temptation. I don’t know if the damage to your reputation would be worth that… but perhaps it is, it’s a hard choice. In the past, there would be consequences for skipping out on your debt like that. I bet if you were in a different country, that wouldn’t be allowed. But in our country, most of the blame seems to be directed towards the banking system. We the people, were just innocent lambs lead by the noses to be slaughtered. I think the government underestimates some of us… Some people, (probalby most of use reading financial blogs) feel like we have been getting the short end of the stick lately, with government programs that benefit just a few of us, and not equally distributed like it should be.

While I don’t agree with the tactic above, I can see the financial logic and temptation that is presented and if you’re upset with the banking system or government… Hmmm…

For most areas of the country though, below are some things to consider.

Money Reasons not to walk away from your mortgage:

Damage will be done to your credit score
Banks will be cautious to loan you money in the future
Eventually, the value of your house will rise again
You’ll regret leaving, especially if you hurt your neighborhood
You’ll have a reputation as a a non-trustworthy individual, forever…
People will pity you and think that you can’t control your money
Ethics!

Sad, I hope this trend of strategic defaults, doesn’t catch on much more than it has, elsewise, we might have more systemic risk problems down the road. Another possiblity might be longer stagnation in the housing market…