Jan 26

Now and then it’s time to point out things that are just nonsensical. Today’s the day for a few. We start by recalling how the media and our president both used the word Rich when really what they meant was High Earners. No doubt, if a couple makes $400K a year, they are high earners, but if they spend every cent, and have little savings, they are actually not rich. I recently read an article making a similar mistake, How Many Millionaires in Belmont? Not As Many As You May Think. The headline caught my attention, but as I read the article I saw, “Of the 11,557 state tax filers who reported at least $1 million in income in 2011, Belmont can only claim 178 millionaires.” Hello? Just when I came to terms with “black is the new black,” do I need to accept that ‘millionaire’ now means ‘million dollar per year earner’? Probably not, even the cited article had a title of, “The Massachusetts towns and cities with the most million-dollar earners,” exactly describing this correctly.

I love reading Paula Pant’s blog, Afford Anything. It reminded me of a teaching moment I had with my daughter many years back when she asked me if we could afford something. My response was, “We can afford anything, we just can’t afford everything.” For me, there are many aspects of my spending that are clearly frugal, yet others that seem extravagant. Balancing the two fits our budget. Paula recently offered an anecdote we can all learn from, Why I Wasted an Hour of My Life to Save $3.60. It’s a look at how even someone focused on the numbers can slip up, wasting time that’s far more valuable than the money one might save. In Paula’s case, the cash discount meant an hour round trip in the car. A stupid mistake by someone I know to be a bright entrepreneur and financial author.

And the third article is actually a pair by Forbes author Laura Shin, 13 Money Mistakes To Stop Making By Year’s End, and The 13 Biggest Money Mistakes Retirees Make. I’m sure there’s a psychological effect on an article of mistakes to avoid vs stuff you should consider. Which is why these two lists strike me as brilliant. A total of 26 bits of advice, I’d bet you’ll find at least a handful that can help you improve your finances.


You are Here” is an article by The Reformed Broker, frequent CNBC commentator Josh Brown. It’s an overview of where we are in the market and what 2014 might hold in store. If you don’t read any other links today, read Josh, he’s an investment advisor who pulls no punches, using phrases such as “Thank god there was no f***ing Twitter back then.” With all the talking heads on TV shouting this or that, Josh appears the voice of reason, expletives aside.

Bargain Babe asked, “Are We Saving Too Much Money?” She and her husband were saving 26% of their take home pay, and she was having a bit of internal monologue on this. She’s in the minority, as a country we save far too little despite the recent media promotion of claims to the contrary. More on that topic on Tuesday.

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Oct 06

Given the recent events in Washington, it’s appropriate to start this week with Roger Wohlner’s Some Stock Market Perspective amid the Government Shutdown. Roger talks about the long term, and how short term bits of news or craziness in Washington get lost in the noise when we look at decades of data. Check out his article for the beautiful charts he’s posted, but stay to read his insightful commentary.

A Thank-You to J Money, my McDonald’s Budget article was featured at Budgets Are Sexy this week in J’s Rockstar Roundup: Billionaires, Weirdos & Drug Dealers. (Disclaimer – I am not, nor likely to ever be, a billionaire, nor am I a drug dealer. At times, I’ve been called weird. I plead, no contest.)

At Get Rich Slowly it was time to Ask the Readers: What’s the best way to prepay your mortgage? The reader asked about making bi-weekly payments on her mortgage. I have no objection to setting money aside to make extra payments if that’s what you’d like, but I advise never to pay extra to service the bi-weekly payment. Just send in the extra funds as they accumulate.


Who Really Needs Your Social Security Number? This was the question that was answered at MoneyNing this week. It’s not a number you should give out to anyone that asks, there are really a few select times it’s actually required. Emily explains when to just say “no.”

Just when I thought I’d never reference Soylent Green again, Frugaling.org posted Soylent: The Future Frugal Food Source. It seems a company has appropriated the name Soylent and is manufacturing an inexpensive source of nutritious food under this name. To be fair, the Soylent website offers a discussion of food waste and cost. This product has the potential to reduce the issue of starvation in the world. If you visit the site, you’ll note the founders of the company are young, too young to have seen the movie in the theaters. It’s we who are 50 and over who will be a bit grossed out by the name of this product.

And from Time Management Ninja – Why Being Right Isn’t Always the Most Productive Answer. I offered my own comment, agreeing with Craig that time is important, and sometimes moving on is far more important than being right. The debate can be a productivity killer. I’ve seen it happen time after time.

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Mar 10

We’ll start this week with Pragmatic Capitalism’s It’s 2000 & 2007 All Over Again. Has the market come too far too fast? We are just above 1500 on the S&P after 13 years since it was 1500 the first time. Is it time to worry another decline is coming?

Investors’ Quandary: Get In Now? – The Reformed Broker, Joshua Brown tells us why this is the Wrong question. I’ll spoil the punchline, the correct question is “Why are you out in the first place?” I agree, there’s a never ending cycle of buying just as new highs are reached, so the same people that panic-sold when he S&P dropped below 800 are now thinking 1500 is time to buy back in. I’m in it for the long term, but if I were thinking of reducing our stock allocation it would be just as this money flows in.

At Couple Money, Financial Samurai suggests ways to Beef Up Your Job Loss Emergency Plan. Sam explains why getting laid off from work might not be a bad thing, and I’m convinced he’s right about that. If you’re getting burnt out at your current job, a layoff may be a blessing.

This week there was a lively discussion at Man vs Debt. Joan Otto, Man Vs. Debt community manager, wrote Are 401(k) and 529 Plans a Good Idea When You’re In Debt? In this article, Joan makes the case for skipping the 401(k) for the time it takes to pay off your debt first. I offered the comment that someone should never walk away from the free money of a matched deposit. Joan kindly stood her ground preferring the motivation of seeing the debt reduced as fast as possible. Let me just say this –  I know it’s not always about the numbers. There’s psychology, feelings, and sleeping at night. Know what? That’s ok, too. One size doesn’t fit all, and if the math doesn’t impress Joan, I’m not insulted.

Barbara Friedberg talked about The Overlooked Wealth Building Trait. You don’t know what it is? You will.

My friend John Wedding will tell you why A pizza guy shouldn’t make a cardiologist salary. Seems a delivery guy received a $10 tip on 85 pizzas costing over $1400. What do you think? $10 was too little? (Agreed) But how much is too much? $210? And what’s ‘just right’?

This week I had two guest posts I’m proud to share – At Block Talk, H&R Block’s Tax Blog – my Top Ten Tax Audit Triggers. For the tax pros in my audience, let me know if you think I missed any. And at TurboTax – Save More Green with Daylight Savings and Energy Efficiency Credits.

And that’s a wrap for the week. Uh, not yet. Post Operative? Oh, right. Jane had a bit of pain in her stomach this past week, and went to see a doctor on Wednesday. 1PM Doctor Visit, 4PM MRI. And off to a 9PM surgery to remove her appendix. That made for a bit of a stressful week in the Taxpayer household.

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Mar 09

the-destituteAs we watch the financial news and celebrate the market’s new highs*, let’s not forget those for whom these numbers really have no meaning. The poor and not so poor who simply haven’t saved. Nearly half of us have little to no savings at all.

* I know, the S&P 1500 of today isn’t the S&P 1500 of the year 2000, there’s some adjustment for the dividends along the way as well as inflation. One more reason the indexes are meaningless, it’s each year’s return that matters.

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Aug 05

Let’s start this week with a post from POTUS, in which he asks Who is fighting for middle class tax cuts? From what this calculator offers, families right up to the $400K level would fair worse under Romney’s tax plan than Obama’s, but once past $500K, it’s Romney all the way. He we go, back to the 1% vs the Occupiers.

I was a bit surprised to read Forest at Frugal Zeitgeist tell us I don’t give a damn about my credit score. I’ve decided that credit is a bit like religion, there are those who believe that debt is to be avoided, and that those who use credit cards on a regular basis are flirting with disaster. Others believe that like guns or sharp cooking knives, they have their place when used correctly. Forest shared how he made some bad decisions in his early 20’s that made him swear off credit cards forever. With that, came his lack of wanting to care about his credit score.

An interesting post from Lazy Man and Money – New Nonsensical Stock Trading Idea: Someone Else Paid A Lot More For It. In this article he discusses a few recent stock purchases, made far below the highs these stocks had risen to. Since people were willing to pay far more than this, the price I’m paying now is better. Hmm. Maybe. But he’s also clear, he’s only putting up a small bit of money on these purchases. Stock picking is a pretty touch game.

Len Penzo offered a remarkable The 50 Biggest Money Mistakes Household CEOs Make. An amazing list of mistakes to avoid. Avoid them all and you’ll be richer for doing so.

At One Money Design, Kevin (from Out of Your Rut) tells us Why Now is THE Time to Refinance. I’m now at 3.5%, and up until a few years ago never would have dreamed of such a low rate. My first mortgage was 13-5/8% and it was a 15 year fixed. To me, this is pretty amazing.

And to wrap up this week, Rob Bennett explains What We Can and Cannot Predict About Stock Returns And Why. Rob’s focus is on P/E10 (the ten year trailing P/E) and how it can be used to forecast stock market performance. Unfortunately, if I am reading correctly, the current 10 year forecast is centered around a 2.21%/yr return. Not so good.

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