Thursday, June 29, 2006

One Carnival and One Festival, Right This Way...

Sorry for being so light on the posting. I'm on vacation for 9 days starting Saturday, and it seems like all my free time is being taken up by things that have to get done before I go.

Anyway, in the meantime, don't miss the Carnival of Personal Finance and the Festival of Frugality from this past week!

Sunday, June 25, 2006

Hurry up and consolidate your student loans!

There are just a few days left until the deadline to consolidate your student loans. If you're a graduate and haven't consolidated, you should do it now*; if you're in school, especially if you're a rising senior, it may also be a good idea. And since Congress ended the "single-lender rule" last week (as of June 16, 2006)-- which means that now borrowers are free to consolidate with any consolidator they want-- you have a ton of flexibility.

Last week I put on my "financial advisor" hat-- as I tend to do for my family-- and made some recommendations for my sister, class of 2007. Not only does consolidation get you the benefit of a 1.8% lower interest rate (2.4% if you lock in while in school or during your grace period), but a lot of places offer great incentives. Here's a long thread at FatWallet about it. However, a lot of consolidation services give me a really bad feeling; many of them are for-profit, have popped up overnight, have a lot of fine print, etc.

I ended up pointing my sister towards Student Lending Works, which is a non-profit organization connected to the state of Ohio. It gives you an 0.25% interest rate reduction for signing up for automatic payments from your bank account, and a 1.0% interest rate reduction if your first 36 payments. (That's a pretty standard incentive package.) If you're an Ohio resident or go to an Ohio school, it's an even better deal. There are actually a couple other incentive packages they offer, like earning a 3.3% credit off your loan balance after 30 on-time payments.

What will happen for my sister is that her loan will go into repayment, but she'll then qualify for an in-school deferment, so she won't have to pay until she graduates. She will lose the 6-month grace period after graduation, though.

So my sister will have $11,000 in loans consolidated with this service for a payment of about $80 a month. Then she'll have about another $5,000 for her senior year at a higher interest rate. I encouraged her to try to get the smallest payments possible on her consolidation loan, so that she can pay off the higher-interest loan faster.

If you still want to do this, you really have to hurry up... interest rates go up on Saturday, July 1 (and there are some other changes taking place that date), so all the paperwork has to be done by June 30. However, you may still have a chance; the consolidators really want your money, so they'll work hard to help you get it done in time.

*You should do it now if you've been planning to for a while but procrastinating; there are certainly good reasons not to consolidate, especially if you are in a line of work where you could get your loans forgiven, since consolidating can end your eligibility for that.

Friday, June 23, 2006

The Upsides of Downtown: Frugal living in the heart of Chicago

Sure, living downtown in a big city can be kind of pricey. But there are also some amazing perks: not just quality-of-life benefits, but things that can save some serious money, too.

This list is based on my own experience in Chicago, but I'm guessing much of it applies to other people in other cities as well:

  • No need for a car.
  • Spending less on public transportation by walking instead.
  • Getting lots of exercise from walking, so no need to pay for a gym membership.
  • Lots of big apartment buildings/condos with exercise rooms, so no need to pay for a gym membership.
  • Lots of restaurants around, with lots of coupons. (Every 3 months a coupon book comes in the mail with buy-one-entree-get-one-free coupons for 8-10 restaurants within walking distance, so most of our dinners out end up being half-off!)
  • And best of all, there are so many incredible free entertainment options within walking distance! Millennium Park has tons of free concerts in the summer, and free ice skating in the winter. There's SummerDance: dozens of free one-hour dance lessons all summer long, plus live music to dance to afterwards. There are movies in the park. There are free evenings at the Art Institute. There are fireworks at various times year-round. There are all sorts of parades. There's easy access to the great deals designed for tourists, with all sorts of neat freebies on "theme weekends." Man, I love Chicago!

Tuesday, June 20, 2006

Terrific CoPF with some terrific posts...

There's a great birthday edition of the Carnival of Personal Finance at Consumerism Commentary, including not just the best posts of the week but some of the best of the last year!  Here's some favorites...

Check out Nicole (the Budgeting Babe)'s post A Rewarding Life about volunteering:

How does this all fit into personal finance? Well, for me, the quest for smart money management is not only the search for security, it's the journey to find balance. If I can fill my life with unforgettable, fulfilling experiences, I don't think material goods will matter as much to me. Sometimes the search for the perfect pair of jeans, the latest make-up, the most extravagant furnishings, is less about what we have than what we're missing.

Then there's a post called Are we doing enough about poverty? at a blog called Clay and Wattles (subtitle: Sustainable Living in Northern Canada):

Like many of the issues I have considered here, the problem of poverty is so complicated that I am tempted to throw up my hands and do nothing - go back to distracting my better self with TV, music, and sugar. Yet I know that would be wrong. I have an obligation to find a compromise between my own interests and those of, for instance, hungry children... Sorry, no answers today - just questions.

And then there's Don't Give Up Your Latte at My Financial Awareness:

Third, you should have a few things in your budget that bring you peace, love and joy.  For some, it is the morning latte that gives them joy.  They may find it relaxing to drink their coffee at the park or just walking to work.  It is about the moment of peace that they get before entering their non-stop job.  So, if a cup of coffee gives you happiness, do not deprive yourself of it, as long as it fits into your budget... Sixth, look at what really gives you peace, love and joy.  You may think that the cup of coffee brings you peace, love and joy.  However, it may be the few minutes of peace that you spend before going to work.  Instead of buying a cup of coffee and reading the paper for your few minutes of peace, you may be able to get the same experience by sitting out on your deck.  We sometimes think that the material object we buy brings us peace, love and joy versus the experience itself.

Sunday, June 18, 2006

Are consumer surveys, focus groups, etc, too much promoting commercialism?

I'm wrestling with a conflict between money and my values. I have a strong distaste for advertising and commercialism-- so is it wrong to involve myself with them to make money?

I really don't like advertising. I mean, I don't like consumerism and materialism period, so it's logical that I wouldn't like the advertising that promotes it. But it's more than that. Advertising tries to make us dissatisfied with our lives and ourselves, and then tells us that buying things is the solution. Advertising works very hard to create new desires for us and convince us they were there all along. Advertising tries to convince us that our love for the important people in our lives should be expressed by giving them material items. Advertising inundates us with racial, gender, and other stereotypes (it's obviously not the only culprit). Advertising helps perpetuate class inequality by pushing products as status symbols. Advertising helps damage body image and self-esteem. Frankly, I'd be glad if there was no advertising whatsoever, and we relied on sources like Consumer Reports and

So, given my feelings on the subject, I'm thinking I must be a hypocrite for supporting advertising in the ways I do. (I probably feel more strongly about it than most people, so I'm not saying there's anything wrong with other people doing the things I do!)

I do Pinecone surveys. I was pondering the ethical implications of this before I signed up, but in mid-ponder, one of the signup links showed up. Knowing from various pfbloggers that Pinecone's are the best surveys out there, and that signup links only show up occasionally, it seemed the prudent plan was to sign up first and debate later. So I've been rolling the issue around in my mind ever since, even as I fill out surveys and get a couple $5 checks a month.

I don't know. I mean, I wonder how the surveys I fill out are used. If they use my responses to adjust the products to help suit my interests and preferences, that's no bad thing. If they see that I think that it's important that their food be healthy and they decide to make it healthier, that's great. But if instead they keep the same product but adjust their advertising strategy to suggest it's healthier than it actually is, that's really problematic. I don't want to help companies do that!

Another thing I've done is focus groups-- well, one, anyway. It seemed like an awesome deal: $75 for less than two hours of my time. But after I arrived and realized that the product was a particular soft-drink, I started to panic as I tried to remember whether it was a Coca-Cola beverage. See, I try to boycott Coke, but I do a bad job of keeping track of all the various drinks associated with Coke (Sprite, Minute Maid, Fanta, Dasani water, etc). It turned out that it was a Pepsi-affiliated drink, but my relief was muted by the fact that it could easily have been Coke and I wouldn't've known until I got there. It turns my stomach to think that I could be helping a company I disagree with so strongly.

But on the other hand, if it had been a Coke-related focus group, what an opportunity! My simple act of boycotting Coke products is virtually invisible to corporate HQ; but what if I said in a focus group, "Sorry, no, I won't be drinking Coke beverages until you start taking accountability and working with employees in Colombia, community members in India, and other people who your decisions have hurt"? I'm not saying it would change everything, but it would sure get a bit more notice. On a similar note, in one of my Pinecone surveys recently I got asked how important it was to me to buy products from a company that treats animals humanely. I was proud to answer that question and send a message. If people like me avoid these sorts of endeavors, that perspective won't be represented.

Or is that just a good escape hatch for me to justify the fact that I like making a little easy money this way? I don't know.

(Then, of course, there's the ads I voluntarily place on my blog. I guess I figure that they're so simple and unobtrusive that it's really innocuous. But again, maybe that's just justification.)

So, I've gone through the arguments and I'm not much closer to resolution than when I started. I think I'm leaning towards stopping... it's a relatively small amount of money, and it does make me feel strange. But I'm still wavering (largely due to the whole "representing the ethical consumer" thing). Any thoughts?

Tuesday, June 13, 2006

Highlights of 3 months of "Money and Values"

I was checking back in my archives for something, and realized that today, 6/13/06, is the three-month anniversary of Money and Values. It doesn't seem like it's been a quarter of a year already!

In those three months, I've made 49 posts (if my count is correct), and have had just shy of 3,400 visits. I know that's small potatoes compared to most pfbloggers, but it's really exciting for me. Thank you so much for being one (or many) of those visitors!

I've accomplished many of the things I wanted to when I started out blogging, but have fallen short of others. I'm not writing as many posts about values and ethics as I expected, but I have some ideas that I'm really excited about floating around in my head and waiting to be written. And I need to work on writing more posts more consistently!

Here are some highlights from the last few months:

Money and Values


Don't pay ATM fees!

Now, I'm sure most of you are more organized than I am, and you solve this problem the easy way: by always having extra cash around if you need it. But since I use my credit card for almost every purchase, I don't carry much cash in the first place. And while I try to keep some emergency cash in my bag, I always forget to replenish it after I've used it. As a result, it's not entirely rare that I find myself in the situation I was in last Tuesday: I needed cash, and was nowhere near an ATM for my bank. There was a different-bank ATM nearby, of course, but I shuddered to think of paying $3+ in fees, and I thought, "There must be a better solution."

After a few minutes of thought and searching, I spotted a CVS across the street. 5 minutes and a $0.99 package of on-sale candy later, I walked out with $35 in hand. When you're stuck, see if you can find a place to get cash back with your debit card! That 99 cents was already way cheaper than the ATM fees, even disregarding the fact that the chocolate was something I needed anyway. (What's that you say? No one needs chocolate? Clearly you have not been to my desk at work at about 2pm...)

You should watch out for debit-card fees, though. Check and see if your bank charges you for doing a pin transaction on your debit card (mine doesn't, but I hear it's a growing trend). But you'll probably still come out ahead, since ATM fees are just awful, especially when you get double-teamed by your bank and the ATM's bank.

Any other useful ideas like this?

Thursday, June 08, 2006

Do you haggle?

Negotiating over prices is one of those things I genuinely intend to do yet never seems to actually happen.

There was an article in yesterday's RedEye/Chicago Tribune about haggling. It includes some tips like:

  • Negotiate with the person who has the power to make the deal.
  • Take your time.
  • Make reasonable and respectful offers.
  • Build a rapport and appeal to the seller's better nature: "Can you help me out?"
  • And of course: if you don't ask, you won't receieve!
There's no good reason that I rarely haggle; I guess it's just self-consciousness on my part. Whenever I think about doing it, I get very nervous. I worry about people being insulted and thinking poorly of me-- even when it's just a random salesperson I'll never see again! But I ought to try to get over it. As one person in the article says, "Yes, it's a scary thing, and sometimes it's intimidating, but it's one of those things that after a few times it's worth it to you."

I'm hopefully going to be doing more shopping than usual at farmer's markets this summer, so maybe I can work on my haggling there. I'm encouraged by reading another story from the article about a seller at a farmer's market who builds room for negotiation into the prices she sets-- so if I don't bargain the price down, I'm just one of those suckers giving her bonus money! Besides, I usually show up at farmer's markets at the end of the day anyway, so if I buy something for a lower price that otherwise the seller'd have to throw away, then we both win. Wish me luck on this, and maybe I can work my way up from here...

How about you? Do you haggle, and for what kinds of things? Do you have any tips for how to do it well? Or how to convince yourself to do it at all?

Sunday, June 04, 2006

Check out these great posts...

I'll be traveling for work for a couple days, and may or may not be able to post during that time. In the meantime, some more great posts I've come across lately:

Saturday, June 03, 2006

End-of-May Net Worth

$18,041 cash/savings (down $656 or -4%)
$12,111 retirement (up $258 or 2%)
$15,295 debt (down $2,050 or -12%)
$1,175 accounts receivable/owed to me (down $900 or -44%)

Net worth: $14,857 (up $1,652 or 13%)
Net worth including accounts receivable: $16,032 (up $752 or 5%)

Friday, June 02, 2006

Free Souvenirs (Another Frugal Vacation Idea!)

One thing I forgot in my last frugal vacations post is, of course, the free souvenir.  Maybe you typically get by without souvenirs (for either yourself or family/friends), but if you need/want them, there are a lot of free or cheap options.

My personal favorite is the ballpark souvenir cup.  We go to lots of baseball games, and almost every stadium sells sodas in souvenir cups.  Many of these cups are honestly very cool, and all of them are good mementos, but you'll never catch us shelling out the money for the sodas and cups.  Instead, we know that inevitably, many fans leave their cups behind at the end of the game.  It takes less than 5 minutes to scan the sections near you and get your hands on as many as you want.  (We typically grab enough for both ourselves and sports-fan family members.)  Just rinse them out quickly at the water fountain or the bathroom sinks, then give them a thorough washing when you get home.  I assume this would work at other sporting events (maybe even concerts, perhaps?), as well.

But that's not the only way to find free souvenirs-- it's just a matter of being creative.  Maybe it's a restaurant with a really neat placemat, or a tourist brochure that pulls out into a gorgeous skyline/scenic view.  Part of it is being in tune with what you find most memorable about your trip, as opposed to what the "typical" souvenir in the gift shop is-- maybe gathering and pressing some of the wildflowers that you saw and smelled everywhere will help capture the good experience better than a little ceramic box with the image of that flower on top.

By the way, my favorite non-free (but still cheap!) option is postcards.  For some reason I found myself sucked into the desire to start a "collection" of items from the different places I've visited, but I couldn't stomach buying dozens of shot glasses or little bells or those silly little spoons.  So, for a fraction of the price, I pick up a pretty postcard instead.  Many of them are currently on the fridge, and I keep thinking that someday I'll make a nice collage or two to hang on the wall.

What do you do for free or cheap souvenirs?

Thursday, June 01, 2006

My giving plan: donations to support social justice and social change

I said I'd finish it in April. But better late than never, here's my giving plan.

I started by attempting to articulate my priorities for organizations to donate to. I came up with three major ones: a) address issues and problems I care about; b) empower the people affected and disadvantaged by those problems to help address them; and c) look at the underlying issues and work for fundamental social changes.

Then I looked at my 2006 target amount ($3,000, or 10% of my take-home pay), and divided it into $2,000 for U.S. and $1,000 international. In the past, I have strongly focused on U.S. groups, mostly because it's what I'm most familiar with. But considering that the vast majority of people on the planet are non-Americans, I want to put at least one-third towards international causes-- hopefully 50% or more in future years as I become more educated about international issues and organizations.

Finally, I made a list of important issues to me and then started matching them up with organizations that I liked. This took a lot of research, but I finally have a rough plan that I'm happy with.

So, without further ado...

$2000 U.S.:

$1000 international:
  • $480 to Oxfam ($40 monthly deductions), which works on an incredible number of issues including hunger and poverty, fair trade, global debt relief, indigenous/minority rights and women's issues, microcredit, workers' rights, disaster relief, and more
  • $100 to La Base fund which makes loans to democratic workplaces in Argentina
  • $100 to MADRE, an organization focusing on women's human rights internationally
  • $70 to Doctors Without Borders
  • $200 (25%) not yet allocated
As you can see, I chose to leave 25% ($750) unallocated. That amount can go towards new organizations I learn about, disaster relief, miscellaneous donations, etc. It will also hopefully help fill in some of the gaps that remain in my current list (pending more research) such as low-income women and children's issues in the U.S., and more on international medical needs.

Now it's time to start carrying out this plan, and I feel confident that I can do it, despite the fact that I've never reached my giving goals before. I'm going to set up my Oxfam recurring deduction right away, and then draw up a rough schedule to start knocking one or two $100 donations off my list each month.

Let me know if you have any thoughts about my plan, information (good or bad) about the groups I've listed, or ideas for other groups that I (or others) might be interested in giving to! And I highly encourage you to try this for yourself. It is very thought-provoking, helps you clarify and weigh your values, prompts you to learn a lot about what people and organizations are doing to address the issues you care about, and (hopefully) leads to greater follow-through on good intentions.

All the credit goes to Claire, of course; please check out her original post on this subject.