Comments on: Reader Mailbag: Sleeping Toddler

By: Baley

Baley — Wed, 25 Jan 2012 22:03:25 +0000

@deRuiter: Of course all parents should be careful of whom they leave their children with; you shouldn’t assume that Annie is not very familiar with all the people who offered to babysit her baby.

By: jim

jim — Wed, 25 Jan 2012 00:15:22 +0000

Old Glory Insurance company is registered in Texas. They are not licensed in my state though. Their website says “Old Glory Insurance Company provides workers’ compensation insurance and services for small to mid-size businesses.” So they seem focused on commercial workplace comp. I don’t know if they still offer individual consumer robot plans. I should call and ask…

By: Courtney20

Courtney20 — Tue, 24 Jan 2012 22:32:36 +0000

Jim – I don’t know, better check with Old Glory Insurance to see if you’re covered.

By: jim

jim — Tue, 24 Jan 2012 21:35:12 +0000

Courtney, what about pedophile robots?

By: Courtney20

Courtney20 — Tue, 24 Jan 2012 19:09:33 +0000

Yep, don’t leave your child with anyone ever. Including your spouse. They might be pedophiles. Heck, you yourself might be a pedophile. Better to put them in a cage and have them tended to by robots.

By: deRuiter

deRuiter — Tue, 24 Jan 2012 14:52:26 +0000

#22 Kevin, Ashamed of warning people about potential pedophiles? What Kevin, you don’t believe that there is pedophilia in some families? How about the Catholic church, one big happy family with many pedophiles over the years who were enabled by their bishops, moved from parish to parish, to give them a fresh start and new children to molest? Remember all those caring parents who left their boy children in the hands of priests so the children would be “safe”? Better to be wary than have YOUR child molested and emotionally damaged for life. You can carry this “nicey, nicey, we’re all loving people” stop “fear-mongering” stuff too far. Ask your local police or social workers about how much child sexual abuse there is in families. How about those people who left their children with Sandusky? Bet they wished they’d kept the little boys at home. It’s up to the parents to PROTECT THEIR CHILDREN, not worry about hurting the feelings of well meaning characters like Kevin who do not understand or accept that there is evil in this world. What should we do Kevin? Should we put our babies with any family member who volunteers in order to be politically correct and not hurt the feelings of the occasional pedophile?

By: Kevin

Kevin — Tue, 24 Jan 2012 13:36:43 +0000

@deRuiter:

That’s reckless fear-mongering. You ought to be ashamed of yourself.

By: deRuiter

deRuiter — Tue, 24 Jan 2012 11:48:05 +0000

Q4, Annie, I’d be pretty careful about whose chit I called in when leaving my precious baby wth someone else. Can picture your family pedophile (and they are there!) handing in his / her chit with all the rest, a big grin on his / her face. Do you actually KNOW all these people well enough to leavy your defenseless baby with them? That said, you want web cams set up if you are leaving your child with anyone. This is not personal finance, this is the safety and health of you BABY. Maybe you ought to postpone a lot of these night alone with husband events until the child is older. That said, everyone ought to be real careful about with whom they leave children, there ARE pedophiles in some family circles, and often the family won’t tell you, they have a stake in keeping it secret. For instance, Daddy or Mommy molester is protected because he / she brings home the money from a good job. This is your BABY.

By: Sara

Sara — Tue, 24 Jan 2012 05:13:24 +0000

State pension plan choices: I don’t think Trent is well qualified to answer this one. I am a retired teacher receiving a state pension which is a defined benefit. I receive a monthly amount based on a formula containing my final salary, my years of service and my age at retirement. With 27 years in the system, it’s quite generous. In contrast some other friends were in plans where they put their own money aside, and with the stock market slide, their savings are worth less (they refer to this as ’201′ plans). Many institutions are phasing out the defined benefit plans, but if you have the opportunity to get into one, it can be a great option.

By: Petra

Petra — Mon, 23 Jan 2012 22:34:44 +0000

Q8 I think ou’re ignoring your student loans too much. Unless you are betting on student loan forgiveness (and that’s a very risky bet with the odds against you), you are ignoring an opportunity to make more than 6% guaranteed profit with your money by paying off those student debts quicker. So stop puTting money away in the 1% savings account and start putting it towards your debts.

By: jim

jim — Mon, 23 Jan 2012 21:27:51 +0000

Q9 : To know which option to choose you’d have to look at the actual benefit formula for the pension. But the question doesn’t give that information. Just knowing how much % is contributed by the employee isn’t enough.

Looks like SERS III in CT is 1.33% x average latest 5 years salary x years service (roughly). SERS III and the hybrid plan seem to have the same retirement benefit formula. I’m not really sure why somone would want to go with the hybrid plan since your contribution is 5% and all you get is the right to take a lump sum. The SERS III plan is only 2% and has a pretty good benefit. If you had that SERS III plan for say 30 years you’d end up with a pension of roughly 40% of your final pay. The pension also has a cost of living adjustment. Do do as well with your own investments in the ARP plan and the 8% from the state you’d have to get somewhere around 7-8% return on your investments. Thats a feasible return. Either one is not a bad choice financially so it depends if you want a pension or the contribution investment account.

By: mary w

mary w — Mon, 23 Jan 2012 21:08:35 +0000

Q9. Rather than ask Trent and get a knee jerk answer, I’d spend the money and have a CPA or financial advisor “run the numbers” on the 3 plans so you can better understand what you will get in each.

By: jim

jim — Mon, 23 Jan 2012 20:55:33 +0000

Q2 : Personal Finance for Dummies is a good starter overview book. (not implying anyone is a Dummy)

Q4 : No reason to feel guilty at all. They gave you babysitting as a gift. They expect and want you to use it.

Q6 : Your children do not need life insurance. Generally its a poor investment. IF you can’t afford a funeral then you should first build an emergency fund large enough to cover such a cost. If you are simply broke and worried your child will die (very low risk) then cheaper route is a rider on your own life insurance.

Q7 : I can see paying more for stuff to support local shops. But paying 100% more? Thats too much if you ask me. If you’ve got money to blow and want to support local businesses that need your charity to stay open then OK I suppose you’re free to do what you want with your money. But I don’t think its reasonable to spend that much more just because someone has a shop nearer you. A small business needs to be competitive and have some sort of reasonable business model to survive rather than just relying on charging very high prices and hoping people will pay more.

Q9 : Trent has an unfounded paranoia about pensions. Theres no real reason to think any state pension is going to short change its existing members. You can’t just steal money out of pensions. I don’t think a state pension fund has EVER defaulted. Private company pensions are heavily regulated and there is a government guarantee organization that would step in to bail out a pension if a company goes bankrupt. I don’t know why Trent is so anti-pension but I assume something in his families past makes him bias.

By: Jules

Jules — Mon, 23 Jan 2012 20:11:08 +0000

RE Q7: I also second Johanna–sentimentality is never a good reason to sell yourself short. If you have a quality product that I want, I will happily pay through the nose for it. Naked Chocolate in Philly, for instance, had $3.50 hot chocolate, but it was worth every cent, and Capogiro’s gelato cost an arm and a leg too, but that didn’t stop me from getting one every few weeks. Why? Because they were GOOD. But don’t give me lukewarm tea with milk and call it “chai” and expect me to come back.

By: Wes

Wes — Mon, 23 Jan 2012 18:50:55 +0000

I agree with Johanna with regards to main-street businesses. My wife and I will bring our business to such places only if there is a good reason to, aside from “We’re local.”

Thus, we prefer local restaurants over chains and occassionally go to small markets to get specialty food products that you can’t get at the big-name grocery stores. But one type of store I have yet to see any justification for visiting is the local bookstore. Amazon is cheaper (I know, I know, there’s no sales tax. But even if I did pay sales tax at amazon, it would still be cheaper than full retail). With the free prime account we have, it is way more convenient. Also, I have no need to browse because I know what I want, and I know Amazon will have it.

By: Jackowick

Jackowick — Mon, 23 Jan 2012 18:18:46 +0000

Q7 “Mainstreet” I enjoy these benefits from mainstreet:
-Trying on actual clothes and seeing if my intended purchase has a loose seam or other quality issue, in addition to “fit”
-Seeing the item in person for size/shape/color. Ordering a toaster online and trying to measure out the approximate countertop footprint (and interior) isn’t the same as holding it in your hands
-In the case of returns, there’s no issues and it’s much cheaper for me to hit the store vs driving out to UPS or USPS. Even a prepaid label may require me to “pay” by using my own tape to reseal the box.
-Goodwill discounts: my local comic book shop was gifted by a collection of books from an old customer. The purpose was to reward the loyal customers with free comics. I had recently committed to having an in-house subscription with the shop and viola! I got to enjoy free books at Christmas. Similarly, I’ve had a cash-and-carry discount at a local parts store where I am also buying local.
-Taxes and property: my town has a lot more churn on mainstreet over the past 3 years. Every time I store goes down, it’s a sword of Damocles on the taxes next year. My home value is also tied into the community and the sellability of the neighborhood/town.

While paying more for local goods seems to be counter intuitive to being as thrifty as possible, it also ties into responsible buying. I see many local businesses where the owner of the shop also owns the house over top/in the back. If they had to close up and move to walmart, their hourly wages would not cover their expenses and they would have to MOVE out of the community they enjoy.

The best thing you can do for a local business is to make a purchase AND tell a friend. Word of mouth is huge. I worked at a mom-and-pop store in high school and we lived and died by word of mouth. When a customer came in and was able to get free advice, my boss got upset that they wouldn’t give us a symbolic purchase to compensate us, buying even a dollar item to show they were grateful. Nothing is free, and gratitude should always be paid in full.

By: Tom

Tom — Mon, 23 Jan 2012 18:15:15 +0000

Q9: I’d be weary of option 1 for two reasons:
1. It’s only 2% of your salary as a contribution, and you’ll reach retirement age (as defined by social security) in 20 years. That may or may not amount to a large benefit, depending on how fast your salary rises.
2. It’s the default choice for people who don’t make one according to their website. This leads me to believe it’s the cheapest option for the state, which may not necessarily be the best option for you.
I’d strongly consider option 2, you’ll save a larger percent of your salary pre-tax, have a pension or cash out option. You can always continue to save elsewhere, like IRAs or taxable accounts if you really want to invest in the stock market (which is what option 3 sounds like to me).

By: Johanna

Johanna — Mon, 23 Jan 2012 18:02:35 +0000

@Steve #9: I don’t doubt that that was the point Trent was trying to make. I think Trent often tries to make good points, but gets carried away with himself and ends up turning a good point into something ridiculous. This is one of those times.

By: Johanna

Johanna — Mon, 23 Jan 2012 17:36:13 +0000

I’m going to go against the crowd a little bit on Q7. There are lots of reasons it’s worth it to me to patronize my local main-street businesses. They often offer things I can’t get online, from big-box stores, or from other chain retailers: convenience, higher quality, a more pleasant shopping/dining environment, expert service, etc.

The main-street businesses I *don’t* patronize are the ones that don’t offer any of those things, but just try to guilt-trip me by screaming “We’re a small local business! Why do you hate small local businesses!?!?!?!” They’re the ones, usually, that end up as boarded-up windows. To which I say: Good riddance.

By: Steve

Steve — Mon, 23 Jan 2012 17:29:30 +0000

@Johanna Re:@Q8
I think the point Trent is trying to make is that too many people get into trouble because they assume a huge salary is just around the corner, and spend today as if they have that salary now, or as if that salary is guaranteed. Of course we wouldn’t have any doctors if all medical students ignore their future income altogether per Trent’s advice. Nevertheless, even as a medical student, it’s wise to keep your expenses low until you actually start making that income, and try to save a little money whenever you can.