Reader Mailbag: Post-Christmas Haze

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What’s inside? Here are the questions answered in today’s reader mailbag, boiled down to five word summaries. Click on the number to jump straight down to the question.
1. Favorite Christmas present
2. Career and schooling choices
3. Oldest card issues
4. E-readers
5. Investing while on Social Security
6. Rebuilding savings after children
7. Preferred vanilla bean
8. Planning for the future
9. Starting over
10. Dealing with tenuous income

The presents are opened. The children are playing with their new toys. The days are just starting to get longer. The new year is about to begin.

Q1: Favorite Christmas present
What was your favorite Christmas present?

- Dan

I received quite a few items this season, but my favorite is probably the gift my daughter got for me, the board game Descent: Journeys in the Dark.

Why was that my favorite? It became my favorite when my wife told me about the process that they went through in choosing that as a gift.

My three year old daughter wanted to get me a game. She wanted it to be a really big box. She wanted it to have monsters in it. She wanted one that I would play with my friends. In other words, my three year old did all the work in narrowing down what gift to get me over a period of time.

Not only that, she sat there with me as I went through the pieces of the game, punching them out and assembling the figurines.

For some reason, over the last few weeks, I’ve felt a deeper bond with my little girl than I felt before. I’m not sure why. It’s not the gift – it’s something else.

Q2: Career and schooling choices
So here’s my situation. I’m 26, married, own a tiny house (it works for now), and am about to finish my AAS in business with accounting emphasis. I currently work at my college’s library making an average of $1000/month take home. This fluctuates a lot due to the college’s schedule. My husband (25) works for a local grocery distribution center and his pay also varies a lot, being anything from $800-$1300 every 2 weeks, with no sort of regularity or guarantee that a pig check is coming. He has also just started college, enrolling in the AAS for building and construction.

As I previously stated I have almost completed my AAS. The current job market where we live has had very few opportunities for work in my field, and because of our house and my husband just starting school, we can’t move for at least 2 years. At this point I am considering a few different options regarding my educational/professional future. We just had transfer day at the college, this is where several area universities come and talk with students about transferring to get bachelor’s degrees. What I found out was that most 4 year institutions will only accept about 5 of my AAS classes (15 credits out of 63). This isn’t something they tell you at advising, or make mention of in the catalog, they tend to make it sound like any class is accepted by any college.

There was one university that accepts all of my credits; however it is not as well known or respected. It is mostly an online university, but I would be able to get a bachelor’s in business in about 2-3 more years, I attend part time because we do not qualify for assistance and I pay out of pocket rather than having student loans.

My other option would be to start over and get an Associate of Arts degree which would transfer to the 4 year college I wanted to get my bachelor’s from. This option would be cheaper in the short term, as the community college classes are about ¼ the cost of the online universities’ classes, but then I would be going to school for another 4-5 years instead of the 2-3.

The other possibility I’m debating is to just get my AAS and not continue school, but continue working and looking for work in my field, possibly returning to school later when our finances are a bit stronger. Currently we get everything paid, have an emergency fund and contribute to retirement, but there is hardly any wiggle room, and next to no money for fun.

For the record, my husband likes the last option best because it would free up some extra money in our household.
- Misty

I’m not familiar with your field. My suggestion would be to seek out someone in that field, then have a conversation with them about these options. Take them out to lunch and see what their impression is of the various educational opportunities in front of you.

You also need to establish what your husband’s degree will get him. What is he hoping to do with it? Is it a realistic hope? What do job prospects look like when he’s done with his schooling?

Getting a degree in a part time situation as you’re doing is really only worth it if it’s got a very good chance of improving your income after you’ve earned it.

Q3: Oldest card issues
Am 44 YO w/ spouse, 2 kids, 4 dogs etc. Have two credit cards, one has a zero balance the second has a $3,000 balance that is just months to paid off. The only other debt is a couple of medical bills (new this quarter) and the house. The cars are mature, and paid off. There has been no “running up the bills”. I was laid off early this year, but was only unemployed for a few months before I found new work. There has been no significant change in life, purchasing power, or expenses.

Over a year ago, our Credit Card company (large, national bank) raised the interest rate. Called, nope we won’t drop it back. OK, then work harder to get it paid off. Then they dropped the credit limit by half. That was not the end of the world but I felt the FICO recalculating debt ratio. Figured it’s a sign of the times, economy is bad and credit is tight. Now we received mail where the bank is going to start charging a monthly service fee, whether you have a balance on your card or not. This is ridiculous!

I know it is important to credit history to keep your oldest credit card and NOT use it, and I have had this credit card for umpteen years. Also, it’s only $5 – BUT, how much more does a consumer have to take? I can opt out of the monthly charge on the condition I close the card and pay off the balance.

With travel for business, and they don’t issue company credit cards to everyone, occasional car rentals & hotel reservations a credit card is necessary. We reliably use the expense check to pay off those charges on the credit card. Should I transfer the balance to a new credit card? Are there other options that I am missing?
- Cheryl

Do you have a more recent card than this one?

The key thing is to make sure that you have a card that’s been open for at least seven years, if at all possible. If you have more than one card that’s been open for that long (or close to it), you can choose from among them and cancel the rest.

In your case, I would look to cancel that card as soon as possible. Monthly service fees are needless and ridiculous.

Q4: E-readers
Could you address e-readers — Nook, Kindle, etc., at some point? I would like to know what you think of them, how they might work into a sane budget, or not. You may have already addressed them, but I missed it if you did.

- Terry

My wife owns a Kindle and she quite likes it. She’s downloaded quite a few books on it over the years and has spent an awful lot of time using it.

The problem for her, though, is that it’s very, very convenient to just go buy another book. After all, that Kindle store is just sitting there waiting for her. Yes, there are ways to get some free books for the Kindle, but that doesn’t sate the reading needs of a voracious reader like my wife.

My belief is that while they offer some reading conveniences, they also make reading more expensive. You can’t check Kindle books out from the library, nor can you swap them a la PaperBackSwap.

Q5: Investing while on Social Security
I have a disability and I receive an SSDI payment each month. I want to invest, but I’m worried that I’ll be penalized for doing so and lose the SSDI payment. I have talked to the Social Security office about how much money I can make per month before my SSDI is affected. They said I can make up to $1000/month before it affects my SSDI. If I were to invest in an Index Fund, would I exceed that $1000 limit from returns on my investment? Or should I be looking at a different kind of investing for my purposes?

- Heidi

If I were in your situation, I’d put my money in places that would reduce my monthly expenses, not in places where I would earn significantly more.

I’d pay off all of my debts, first and foremost. If I were debt free, I’d sink my money into improving the energy efficiency of my home and other home upgrades. I’d replace my appliances when they needed to be replaced with energy efficient models. I’d keep an emergency fund to ensure that I never had to dip into debt again, and I’d pay cash for things like automobiles and the like out of my savings.

This way, no matter what happens in the future, you’ve got a situation for yourself that’s as flexible as possible.

Q6: Rebuilding savings after children
We are a family of 6, who has been struggling to survive on less than $3000 monthly income for the past few years. I became a stay-at-home mom when I gave birth to our first son, and for most of our marriage, my husband’s main source of income was as a real estate agent. We have always been fairly frugal (usually buying generic rather than store-bought brands, checking the unit price at grocery stores to make sure we’re getting the best value, reusing clothing as hand-me-downs, mending and patching things rather than throwing them out, giving my family haircuts rather than taking them somewhere to pay for one, etc.), and seemed to do OK. However, a few years ago my husband was diagnosed with testicular cancer. Although I’m happy to say he is cancer-free today, the astronomical medical costs sent our financial world in a tailspin. He had to have daily radiation treatments and couldn’t work as much as he had been accustomed to, due to sickness from the treatments. This was coupled with the collapse of the real estate market in Las Vegas, and our income was drastically cut. After years of stress, heartache, and constant struggling, we lost our home and had to file for bankruptcy. These past few years have brought changes I never in my life would have imagined would happen to me, and have been the most difficult of my life. Although we weren’t outwardly stupid with our finances (we didn’t even own credit cards), I am realizing now so many things we could have been doing differently. Nevertheless, you live and learn.

Our situation today is not much improved, but if anything good can come out of this, it is that we will learn to make wiser decisions, and help to raise financially-prudent kids. My question today is in reference to saving. Because we have been living paycheck to paycheck for so long, we have failed to build up a savings. (Any savings we once had was quickly eaten away in medical bills). Our problem is that any time we have even a couple hundred dollars saved up, something always seems to come up…. The car’s brakes are going out (and we only have one car, so we need to keep it working), a tooth gets chipped and a dental crown needs to be put in, etc. It always seems to be something. Our savings account is currently tied to our checking account, so whenever something comes up, it’s extremely easy to transfer money from savings to checking, and then the money is spent before we know it, and the savings is non-existent again. I want to set up some kind of savings account where we both would have to be present at the same time to withdraw funds. That way we could be sure we are both in agreement and that it is an absolute emergency before withdrawing any funds. However, I am having a hard time finding a bank that offers this service. The best they can recommend is to just cut up the debit cards when we get them, but no one offers a joint account where both parties have to be present to withdraw funds. I want something that would be really difficult and inconvenient to withdraw money from, so that when we put money in that account, we can be sure it will actually stay there. Most CDs or other accounts of that nature require a minimum of $5000 to put down – which is just not an option for us. We recently held a yard sale, with the determination that anything we made from it would go toward savings – which amounts to only about $100. Do you have any recommendations of a good program or type of savings account, which could help us with the goal of building back up a savings, when we are more cash-poor (with 4 children) than we have ever been in our lives?
- Mitzi

Many CDs do not have these types of minimums. However, such CDs generally do not return much better than a savings account.

In the end, this is all about willpower. If it’s your money, you do have access to it and you do have to constantly choose not to touch that money.

My suggestion to you would be to open an account at a bank where you don’t have easy access, such as an online bank like ING Direct. Set up an automatic transfer that pulls a small bit out of your checking account each week, then forget about the account for a few years.

Q7: Preferred vanilla bean
What is your preferred kind of vanilla bean for making things like vanilla extract?

- Steve

To be honest, I don’t have a strong preference between types of vanilla beans. They all taste fairly similar to me.

I usually choose my vanilla beans based on the price because I usually just use them in vanilla extract. If there’s a sale on a particular type of vanilla bean, that’s what I’ll pick up.

There are minor differences between the types, but the differences are so small as to not make any impact on me.

Q8: Planning for the future
My wife and I have been together for almost 10 years, and we have a 6 year old son. Oh, and we live in a large Canadian city (not THE largest, but in the top 5).

Vitals:
Ages: 37 & 40
Total Gross annual income (combined): ~210K
Mortgage: 610K (3.6%, 4 year left on term, 35 year amortization). *I KNOW!*
Line Of Credit balance: 27K
Other debt: none.
Retirement: WIFE—defined benefit pension plan (awesome), plus about 12K in RRSP

Retirement: husband—hopefully will be a kept man, but have ~120K in RRSP. Have been contributing ~12000/year over the last several years. Have experienced negative returns (over the long term…since 1994, I’m down about 13%).

Emergency fund: ~5K (in ING across a few accounts, including small TFSAs [I believe that's similar to a david-lee-roth IRA?]

RESP value (for the 6 year old): ~12K (12 years to go until he’s ready for higher edu-macation). We each have two university degrees (useful ones) so we are pro-university.

About a year and a half ago, we left the burbs, and went “all in” on a house in our preferred neighbourhood. We took out a HUUUUUGE mortgage. We can handle it as we both have good salaries.

We had two cars, but sold one. We put that money down against our other car (we bought out the lease—a Japanese sedan that we plan on keeping for another 10 years). So, as of right now, we have our mortgage, and our line of credit (4.25%) has a balance of about 27K, which we plan to pay off by next September (or earlier). This is where my question comes in.

I plan on NOT doing any RRSP (401K) contributions for calendar year 2011. Performance has been horrible, and I want to get rid of the LOC debt more quickly. My plan is to put my ‘normal’ RRSP contribution toward the Line of Credit, until it’s gone (perhaps be done in June instead of September). From there, build up the emergency fund a bit more (to 10K initially). THEN, once that is all done, I’d like to build up a bit of a lump sum mortgage payment (we’d have ~3500k/month available for this, once LOC is gone). Does this seem like a reasonable plan?

Right now we have a low (locked in) rate, but that may not be so in ~4 years time when it comes up for renewal. We hope to have ‘er all paid off in 15 years from now. We plan on retiring in 20 years.

If the next 20 years go by as quickly as the LAST 20 years, we have to have a solid plan.
- Marty

I want to say right off the bat that no matter what the interest rate, a mortgage of value more than twice your combined income is a mistake. That’s true for everyone. It’s a tremendous mountain of debt.

However, now that you’re in this hole, I think you have a sound plan. I think you need to get rid of your non-mortgage debt as soon as possible. I think your retirement savings are healthy enough to spend a year focusing on getting rid of debt.

If you can, I would seek a way to permanently lock in your rate, because an adjustment in your situation would be absolutely brutal.

Q9: Starting over
I asked my husband to move out about a year ago…..he was cheating on me with men……that was a hard hit to take; and he stole jewelry my grandparents had given me, that literally devastated me, I’ll never be able to understand….….I could go on and on. Since then I don’t really know for sure where he is. He left a pile of debt, credit cards, etc., and I’m struggling to keep the house payment and truck payment up. I need a roof over my head and I need transportation for work. It seems, though, that every time I think I am making a little progress something drastic happens and what little savings (very little) I’ve managed to accumulate gets wiped out: I’ve had to spend money on getting rid of unwanted guests in the attic, then a very windy storm knocked down 35 feet of my fencing, and the latest is coming home to blood everywhere and a dog with a severe cut on her foot, requiring a vet visit……those three things were well over $1500. All I see in the future is more expenditures: home insurance, property taxes, auto insurance, etc. I try to think positively about these things and sometimes I can manage it by figuring it can’t possibly get any worse but it is getting worse and my self confidence is gone. He’s already taken my self esteem. I’m at the point where I don’t want to talk to people, I just want to be left alone. I sit and stare at the wall……doesn’t cost me anything. I think I’m depressed but I don’t have the energy to do anything about it even if I am. I keep thinking I’m not the one who did wrong, though he’s done his best to make me feel guilty for throwing him out. Good grief, I can’t even afford to divorce the man! And now for some reason he’s had all his mail redirected back to the house so I’ve got a big pile of mail that he hasn’t called to ask about and he doesn’t respond to any phone messages I leave. I don’t have a good support system, in fact, I don’t think I have any support system. Most of my family lives in other states. My mother is an invalid in this town so I go over just about every day after work to help my brother take care of her. I’m sinking.

- Ellen

My honest suggestion for you would be to reboot everything in your life. You need to get a divorce. Seek out legal help – you might be surprised what you can find in your current situation. You need to sell the property you’re living in because, clearly, you can’t afford it right now.

It sounds like the only nearby support you have is your brother and your mother. If I were you, I’d do everything you could to establish as strong of a relationship as possible with your brother right now. If he’s a good person at all, he’ll recognize that you need him and be there for you.

You may also want to consider some sort of therapy. I do not know what sort of services you have available to you with your insurance and so on, but I do know that you have a lot of issues going on and some sessions with a psychotherapist will probably go a long way toward helping you to resolve them.

Q10: Dealing with tenuous income
I have just graduated from my master’s degree and my husband is finishing up his first year in grad school (graduation date December 2011). I am 29 and he is 31. Since we were married over a year ago, we have merged our savings accounts so that we can save and pay bills as a couple, while still maintaining individual checking accounts. In the past year, we have accumulated $2000 into an emergency savings, both have health insurance (an exciting accomplishment for us), are contributing to our retirement at 12% each (because we are starting in earnest later, we feel like 10% is not enough), and have established a small vacation fund (input of $100 month, covers traveling home to visit families for holidays and a couple of backpacking trips for us). However, we have almost $79,000 in debt from school loans (70,000) and our land in Alaska (9,000 left on the loan). I have been reading your blog for some time and I was beginning to create a debt snowball plan for us to begin attacking our debt in earnest. I have a two-part question for you:

1. As my school loans are not yet activated and my husband is still in school, we are not paying any interest on most of them because they were subsidized. I would think that starting off by paying off our land should be our first priority (8.75% interest rate). Addressing this debt is not only our highest interest rate of all of our debts, but every dollar we pay toward it increases our net worth. But, according to the debt snowball plan, we should start with the lowest amounts of debt, even though they aren’t gaining interest. What is your advice?

2. This is where it gets tricky. My two part-time jobs end in May and I am sure I will be able to get work after that, but I would say our incomes are relatively impermanent. Right now, we have about an extra $900/month that we could put toward our high debt load. I would love to throw all of that money at our debt, but I’m not sure, given our tenuous income situation, if we should build up our emergency fund even higher first or split the money between them somehow. Our monthly costs are fairly low – about $2500 including monthly payments, rents, living expenses, retirement, health insurance, etc. so having $2000 is probably reasonable, and I know it is higher than what Dave Ramsey recommends, but I still am not sure. We are both the kind of people that would work at the corner gas station before going without work, so I know we will always have some kind of income.
- Lindsay

The reason that the “debt snowball” suggests that people start with their smallest debt is for the psychological boon of actually having paid off a debt. If you start with the smallest one, you’ll get that boon first and it’ll give you the motivation to keep going.

If you’re able to find motivation from other sources, then you’re better off paying off your debts in order of interest rate, with the highest interest rate first.

As for how large your emergency fund should be, I think that if you know you’re going to be losing income in May, I would have a larger emergency fund that even what you already have. You do not want to be in a place where you can’t pay your bills. Yes, a bigger emergency fund means you’re going to put off your debt repayment plan a bit. It’s worth it.

Got any questions? Email them to me or leave them in the comments and I’ll attempt to answer them in a future mailbag. However, I do receive hundreds of questions per week, so I may not necessarily be able to answer yours.

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43 thoughts on “Reader Mailbag: Post-Christmas Haze

  1. I have a Sony Reader, and I can check out EPUB files from the library. My local library has quite a few new releases, and books that I like to read available for checkout. Amazon doesn’t let you do that on the Kindle. That’s why I went with the Sony. The Nook also allows you to check out EPUB from the library, but I found the user interface to be awkward. I’m sure you get used to it, but if I can’t figure it out within a few minutes, that’s probably not the device for me. I also didn’t need/want wifi or a good ebook store. I got mine specifically to check out EPUB from the library.

  2. @Q4 While it may not be possible to “check out” e-books thorugh Trent’s local library system it is a possibility with other libraries. I would suggest you visit your library’s website and see if that feature is available.

    Also if you like to read classics or older books there are a whole slew that are in public domain and are available for free. A good source for this is Project Gutenberg (google it and you will find it).

  3. Interested Reader – the Kindle does not let you check out any books from any library (incompatible DRM), which Trent wrote correctly in his response. The Nook and the Sony Reader both allow for e-lending.

    I chose the Nook and have enjoyed it immensely. It’s not a total book replacement for me, as the highlighting/note taking functions and general navigation are somewhat clunky, but the overall interface is fine for reading something front to back. I like having several books in one slim device when I go on vacation, or keeping it in my purse for waiting at the doctor’s office and such.

  4. I was wrong, I don’t have a kindle (or a Nook) but I’d heard/read about people checking out e-books and assumed any e-reader would do that.

    I had been looking at getting some form of e-reader but now am leaning more toward an iPad, I know you can get a Nook app through the iPad and I’ll have to see if that means I can check out e books from the library.

  5. I have the Nook app on my Android phone and can access my purchased books but not my e-loans (which have to be downloaded to my laptop using Adobe Digital Editions software and then transferred to my Nook). I don’t know if the iPad app is different.

  6. Trent, your advice to Mitzi is to put some money in ING savings and hands off for a couple of years. Really. You gave better vanilla bean advice. Mitzi definitely needs to use a savings vessel that is hard to touch. ING would serve that purpose. Automatic savings is another good idea. However, when you are struggling to rebuild you need some more advice. A yard sale is helpful. Try again when the weather warms up a bit,but in the meantime consider consignment shops, used bookstores, any place to unload the family castoffs from her large family. She should have plenty of toys, clothes, etc, to utilize. Every ‘financial snowflake’ could be placed in ING. Mitzi can do this and it gets easier with time. I mean really: ‘Don’t touch the money’. Trent you blew this one.

  7. @Q2,
    “The current job market where we live has had very few opportunities for work in my field”
    Misty, what are you going to do after you put in the time and money to get a BS in the same field? It might not rebound as quickly as you need it to.

    Like Trent said, talk to somebody in the field. My experience is that experience trumps degrees in almost any interview. So I think you should finish your AAS and get a job, any job, while you network with people in the field and get their opinions about whether a BS will really help you in a competitive job market. Once you talk to people in the field, they may give you different advice. It just alarms me that you’ll be pursuing another degree in a field that is already difficult to get into.

    I know the statistics about BS income vs AS income, but if you can’t get in the door that doesn’t matter.

  8. Evangeline,

    I’m sure Mitzi knows where all the used bookstores, etc, are (with 4 kids and not being rich and all). Unfortunately, used stores don’t give that much money. If half-price books gives you 50 cents a book, you’re doing pretty good. But that’s not going to affect your savings accound much. I think his advice to go with ING was the most effective advice he could give. It takes 2 business days to transfer money from ING to a different bank. When I used to have my savings and checking at the same bank, it was set up so that if I overdrew it would just take directly from savings and so I didn’t pay attention to how much I spent. Now, if I want to buy something extra I have to check my bank account, and know that I’d have to wait at least two extra days if there’s not enough. That’s enough to stop most impuse purchases.

  9. For Misty on Q2 – I would go with the school that will take all your credits, even if it’s not as prestigious or well known. I’m in a simular situation with a AAS that would only transfer to one 4 year online school. In my experience, hiring managers care much more than you have a degree than from where. So I’m currently getting my bachelor’s online, which is much better than it sounds if you’ve never taken an online class. You can do what I did, and work for a few years and take a few cheap community college online classes just to get a better feel for it, but if I were you, I would plan on going to that online school that takes your credits sooner or later. Why would you want to have gone to school for 2 years just to throw that away and go to a different school?

  10. I wouldn’t call fixing “The car’s brakes are going out… a tooth gets chipped” as impluse purchases.

  11. Q5 Heidi, I agree with Trent to put money into cost savings and emergency fund first. After that you can invest and not have high income. If you invest in an index fund you will not see a lot of income from it unless you are getting dividends or buying and selling and making profits. So if you just buy a typical index fund and hold it then you won’t have a lot of income. Unless you have 100′s of thousands to invest then you should be able to buy an index fund and not worry too much about exceeding $1000/month income. Some index funds have lower dividends down under 1% but the highest are only around 2-3% range.

  12. Another Sony reader owner here. So far I haven’t purchased any ebooks for it.
    Between my local public library, my university library and Project Gutenberg I have been kept well occupied with reading.
    Before my I got my ereader I don’t think I had bought a book for a couple of years, using the library exclusively; I don’t see why switching to an ereader should change my spending habits at all.
    Just research the different readers; if you use libraries don’t lock yourself into a kindle.

  13. Q6 Mitzi, I think you need to focus on increasing your income. $3k a month for a family of 6 is just not much money. You’ll always have bills to pay that will easily eat up your income so it will be a constant struggle to save anything. You’ll have much easier time with higher income.

    Q8, Marty, I’d increase your emergency fund quite a bit. $5k won’t go very far especially with your expenses. I don’t think your mortgage is a ‘mistake’ exactly given your high combined income. I’m guessing your payments are around $2500/month which is only about 15% of your income. Thats pretty good.

  14. Descent is a fun game. I highly recommend playing the campaign version (it is an expansion). With the campaign you can increase the difficulty each time you play and still have some continuity of gear and spells and dungeon upgrades.

  15. Also a Sony e-reader owner. I like that it doesn’t have wi-fi so I really have to want to read a book, or purchase a book, to get it onto the device. Must be downloaded through USB cable. As Looby commented, I have yet to purchase any books for it. However, my mom has the same model and had no trouble getting books online for it. Just not as easy as getting it out of thin air like the Kindle.

  16. Q9 Ellen, Its not your fault. If you’re depressed then counseling or therapy is probably a good idea. Some places have free options for therapy and counseling so you might check around to see if theres any free options in your area. (universities or non profits might have free services)

  17. Q4: Ereaders are awesome. I have a Kindle and I love it. The problem is, unlike bookstores, it doesn’t take much to buy a new book. The temptation is always there.

    Q6: Consider getting a SmartyPig savings account. You can’t physically go get the money. It’s pretty high yield considering these times (1.75%). It takes 3-4 business days to get your money transferred. May be what you’re looking for (difficulty getting money from savings to checking)

    Q9: I’m so sorry for what you’re going through! There are inexpensive/non-expensive ways to treat depression. Light therapy, exercise, just talking to someone is great (try your brother). Also, you can probably go to the post office and inform them your husband no longer lives there and to stop delivering his mail to your house. Good luck!

  18. @Q9 – you do sound depressed and there are low cost options. There are some you can find online both NAMI and the Depression Bipolar Disorder Support Alliance have free resources –including open group sessions that usually meet once a week. I think the Depression Bipolar Support Alliance has online group chats.

    It’s not exactly the same as private therapy but it’s a good start for finding a support group and getting help.

  19. Ellen – to help cope with your husband’s same sex infidelity, do a search for Bonnie Kaye – she has a website and news letter on the subject and also has one-on-one counseling for people in your situation. You may find some strength in knowing you are not alone (sooooo not alone!!!)

  20. I love my Kindle. I selected this ereader because of the ease of transferring PDF files from my computer. I use it extensively for DS homeschooling program. Lesson plans are available as PDF’s and I can scan pages and save as PDF’s. This works well on the larger Kindle, not so readible on the smaller one (we have one of each).

    I check the free ebooks every day as some are only available free for a short period. I have bought a few books, too, and have tried to compensate the cost by earnings on Mechanical Turk.

    Project Gutenburg now has downloads for ereader formats.

  21. As of December, Overdrive, which is the eBook vendor for many libraries, has released an app for the iPhone (as well as Android) which lets you download EPUB eBooks directly from subscribing libraries. The iPhone is not meant to be a dedicated eBook reader but it is good for those that only occasionally read eBooks such as on vacation or waiting in line at the supermarket. The Bluefire Reader iPhone app also can be used to read most of the Overdrive eBooks.

  22. @Steve: Make sure you’re getting Madagascar bourbon beans. The Tahitian vanilla supposedly has a different flavor. Grade B is fine for pretty much everything. Most people’s palettes don’t taste the difference between Grade A and Grade B.

  23. Q5 Heidi, Social Security Disability has a ceiling of how much you can earn (active income, from a job) before the disability payment is yanked. This is different from passive INCOME (INTEREST OR DIVIDENDS FROM STOCKS, SAVINGS ACCOUNTS, cdS.) The latter is not considered earned income, it will not effect your disability payment. Disability fills in for inability to perform the usual job. Investing, and making a profit, will not effect your Social Security Disability payments.

  24. Question 6 – I had the same problem. My solution was I opened an acct @ a credit Union on the other side of town & have 10% automatically transferred there.

    I can only access the money by driving half an hour or by digging around my house & finding the check book – since most places don’t take checks that restricts how/where I can access the funds. Except for a tow truck, in a true emergency most folks would take a check… an example being the sewer guy if the line backs up or the roofer if I get a leak. In the case of mechanics – I do most of my own repairs however, if I do take the car to someone I make sure they know in advance I’ll have to pay by check & they are usually cool with that advance notice.
    Anyway, just my two cents.
    If your in a rural area you could open an acct @ a bank that’s maybe two or three towns away. My brother opened an acct @ the bank in my Dads home town just so it’d be harder to access.

  25. I have a Kobo (our options are rather limited here in Canada) and love it. It came with 100 classic books, which has kept me busy, and I choose it over the Kindle because I can easily add books from my library’s digital collection or Project Gutenberg. I also use a free program called Calibre to convert and manage files.

    However, in terms of buying books I’ve found that e-books aren’t that much cheaper than paper backs, and they’re certainly more expensive than buying used or heading to the library. However, most people I know find their e-reader supplements their reading habits, not replaces them.

    One thing that annoys me though is that I can’t share. I love trading paperbacks with friends. While Kindle has a function where you can temporary “lend” books, the others haven’t caught on.

  26. Q4 – Trent, i disagree. An E-reader is a HUGE money-saver, if you shop wisely. I have more than paid for my NOOK, bought in August, by downloading e-books (Adobe EPUB format) from my local library. Part of that saving is the postage I’m not paying using PaperBack Swap to get best sellers.

    I get them quicker, and without using a PBS credit, from the library – no Post Office visit, no library visit, no library fines – the book just disappears from the NOOK when the lending time expires.

    AND there are other advantages: I’m 68, with arthritis and cataracts – holding a big new hardback is downright painful, but my Nook is a featherweight by comparison. I can adjust font & brightness settings to compensate for my vision deficit. Finally, I’m heading out for a 2 week vacation – I’ve loaded up my Nook with 10 library books and I’ve been checking Barnes & Noble every Friday for their free books – got a stack of reading material and no DTBs in the suitcase. (DTB= dead tree books)

  27. Q5 — If you can succeed in making money by investing, you won’t need SSI. In effect you would be “earning” money and you would be able to pay your own way. Whereas “disabled” may mean inability to hold a standard job, you are certainly not helpless if you can figure out some other way to make money.

    That said, however, it is unlikely that you will make significant money investing unless you have (1) a big stake to start with, and (2) skill. Since you don’t know how much you might make, and don’t know the effects on SSI, I would guess that you do not currently have the skill, because that skill would allow you to answer such questions yourself “tout de suite”.

  28. @Ellen–Find an attorney who will work on contingency. Pay him $100 anyway at signing, gotten any legal way you can. This will assure that he can’t take money from the unfaithful ex and claim that he is representing him or both of you.
    Check local marriage books at the courthouse and the free 14 day trial of Ancestry.com to make sure that the attorney is not one of ex’s relatives.
    Make sure the attorney is not in the closet–find a good female gossip or two somewhere in homosexual employment–antiques is good, theater is better.
    Get two HIV tests–now and three or four months from now. A positive can take a few months to show up. The pain and suffering involved in waiting for these should be showcased in court.
    Then clean him out. Seriously. Best wishes.

  29. @Misty: I am a college professor (PhD) and my husband is a very successful HR professional at a Fortune 100 company (has a Master’s in Human Resource Management/Business). Between us we know the education and professional worlds quite well, and people come to us with questions like yours all the time. Here is what we tell them.

    Education is worth it. Don’t listen to people who say that experience is more important than education. BOTH matter. You may be able to get a job without a degree, but your mobility will be very limited. And the sooner you get that education, the better. But it’s essential that you be as strategic as possible in getting that education.

    First, don’t get a degree from an online or for-profit university (Phoenix, Kaplan, Strayer, etc.)! They will tell you they are “fully accredited” and give you a sales job about all they have to offer, but the sad, brutal truth is that a degree from an online university is not considered as good as a traditional degree by almost anyone in either business or education. Keep in mind that those schools are for-profit enterprises. They exist to make money off the promises they make to uninformed people–and what amounts to a huge subsidy through government loans and grants their students pay them. I could go on for hours with stories about people we have known who got degrees from these schools, only to find themselves no better off, with a mountain of student debt. I had a student in one of my classes last semester who had paid $30,000 for a degree that had proven to be useless and she was now starting over in a real college.

    Second, realize that an associate’s degree is not really a “degree.” It’s a little better than nothing, but except for a few highly specialized fields (possibly including the field your husband is pursuing), it’s not going to get you very far, especially in a field like business.

    Moreover, a degree in business–bachelor’s or master’s–all by itself is not worth much anymore, either. Business majors are a dime a dozen. You need a solid, practical emphasis to go along with it–accounting, as you have been doing is a good possibility–or finance, for example.

    If you’re serious about getting an education that will get you ahead in life, a traditional four-year degree from a brick and mortar institution is the way to go. Find the career counselors they have in the program you want to enter and ask every question you can think of. Talk to the people who do alumni placement. Talk to some people who have graduated from that school in the past 2-3 years. It’s important to be as well informed and strategic as you can be.

    Good luck!

  30. @Lou

    I don’t see how an ereader could save money. Sure, it’s more convenient and weighs less, which I can definitely get behind. But I, and most frugal people, get the majority of books from the library. At best then, I would think that you’d go from checking out physical books to electronic books, which is no savings in money. You also don’t have the option to buy used with an ereader, though that might be made up for with cheaper prices. The only way I could see an ereader saving money is if your library has a lot more ebooks than physical books, and so you’re able to check out more books that you’d otherwise buy. But I see that scenario as unlikely.

  31. “Monthly service fees are needless and ridiculous.”

    Why are they “ridiculous?” It certainly costs money to operate a credit card. There’s the network infrastructure, the customer support staff, the printing and mailing of statements, lawyers and regulation compliance, and on and on. It costs banks a fair chunk of change to offer you the convenience of a credit card.

    Up till now, those costs were covered by the interest collected from customers who carry a balance on their card, and the merchant interchange fees. However, recent (and upcoming) interference from the government is cutting off those revenue streams. Regulatory agencies are capping credit card interest rates and limiting banks’ ability to adjust rates for changing risk factors of individual clients. Now there’s even chatter about slashing the amount credit card companies are allowed to charge merchants in interchange fees.

    If those revenue streams are cut off, then banks and credit cards will have no choice but to turn to annual fees as a source of income.

    I agree that it sucks, but it’s certainly not “ridiculous.” How is it “ridiculous” to pay a small monthly fee for the convenience of using a credit card? What’s “ridiculous” about banks NOT letting you charge up thousands of dollars without paying a penny in interest (because you pay your card off every month) or monthly/annual fees? It’s been a great free ride while those costs were borne by balance-carriers, and spread across all customers by the merchants (since they’re not allowed to pass the interchange fees on to the credit-card-users), but I certainly don’t think it’s “ridiculous” that the banks are looking to shore up revenue streams that are being forcibly cut off by meddlesome government bureaucrats.

  32. “If you can, I would seek a way to permanently lock in your rate, because an adjustment in your situation would be absolutely brutal.”

    Unfortunately, this is one of the ways in which Canadian mortgages differ from mortgages in the US. In Canada, when taking a mortgage, you select your amortization (the total length of time over which you will be paying off the loan), and your term (the length of time for which you’re locking in your interest rate). The longer you choose for your term, the worse the interest rate is.

    For example, Marty indicated that they’ve chosen a 35-year amortization. That means if they just make the regular monthly payment, it will take 35 years to pay the mortgage off completely. However, he has also chosen a 5 year term. That means the rate he currently has is good for 5 years. At the end of that 5 year term, he will be required to refinance his mortgage, taking whatever the current interest rate is. Of course, the can shop around to other lenders, but if rates have risen by then, they will all have higher rates than what he’s currently paying.

    You can choose different terms, anywhere from 1 year up to (I think) 10 years. I don’t believe it’s possible to lock in a rate for any longer than 10 years. However, the caveat to this is that the longer you choose for your term, the worse your interest rate will be. For example, maybe Marty is paying 3.9% for his 5 year term, but if he’d chosen a 10 year term, the best he could’ve gotten might have been 4.9%. Shorter terms have better rates. It’s a gamble, but there’s no way to lock in a single rate for 35 years. Even if there was, it would be a terrible rate, relative to current rates. It would be a rate that the bank thinks is an accurate average rate over a 35 year period.

    The bottom line is, in Canada, you cannot lock in a great rate for 35 years. It’s simply not an option at any lender anywhere in the country. You can choose longer term and worse rate, or great rate and short term, but not both.

  33. Misty-
    I got an AAS, worked in my field, transferred to a hippie college that took ALL my credits, and am now doing quite well for my field. What I’m finding is it’s not the college necessarily, it’s the work you put in and skills you can display.

    Even though my AAS couldn’t transfer to a traditional college, it was still very valuable because it’s a very specialized degree. Many people with just transferrable AA’s do not have this. I thinking continuing with your AAS and working in the field while researching other options is a great idea. You may even be able to get a job that’s good enough where the next two years of college may not pay off. Who knows. Weigh your options!

    Also, congratulations on almost finishing your degree!

  34. @littlepitcher: “Make sure the attorney is not in the closet–find a good female gossip or two somewhere in homosexual employment–antiques is good, theater is better.”

    “Homosexual employment”? Are you serious?

  35. @Q5, wanting to earn the $1000 per month that you are allowed without endangering your SSI:

    I’ll give this a quick whack to give you some ideas about things to investigate:

    I would consider one of the following two options: Esatblish a Chapter C private corporation (they don’t require earnings to be distributed to shareholders) to invest on your behalf, or look into establishing some category of trust with you as the trustee and beneficiary, to hold and invest that money. Both the Chapter C and the trust are considered legal entities by themselves and are taxed as individuals at a given tax rate. If money is not distributed to you in a given calendar year then you will not have income and come up against income limits for your SSDI.

    There is a minimum $400 annual tax for a chapter C corporation, I believe. I am not sure of the minimum tax status for trusts. But a good estate planning accountant could help you hash it out, or you can investigate it yourself.

    Another option is to invest as an individual but only invest by buying direct shares of companies and do not sell the shares. With no sales of equities, you will have no capital gains. Tell your broker to reinvest all dividends so they are not reported as income. Again, not sure if this will work but it’s worth investigating.

    Finally, determine whether there are asset limits to your SSDI benefits and don’t exceed them unknowingly.

  36. @q5: You’ll need a lot of investment income to endanger your SSDI level. For each $1000 invested that returns 5%, you only earn $50 in the year.

    One other idea, actually the one that seems most practical for what it sounds like your income level is right now, is to max out a Roth IRA every year. The income from the Roth is only taxed at the time you withdraw the money–presumably, you will be withdrawing the money when you really need it, so tax issues won’t be paramount at that point.

    If you are only able to come up with a couple thousand to invest per year, I would suggest a Traditional IRA, not a Roth, for various reasons, one of which being that it sounds like you are not likely to have a huge investment income due to your investments, so being able to contribute pretax dollars to an IRA may be of more benefit to you than the alleged benefits of the Roth IRA.

    You will want to talk to an advisor about how Roth monies will affect SSDI.

    good luck and happy investigating.

  37. @q9,

    I would suggest getting a housemate or renting our part of your house. Also, sit down and make a plan and follow through on it for divorcing your husband. It will be best for you mentally if you are the one to initiate this. It sounds to me like your husband has few assets (since he has left a pile of debt, in your words.). You need to separate your finances legally and the only way to do that is through divorce. In the meantime, since you have his account information, I would *conside*r canceling all of the credit cards so that he can’t run up any more debt than you will be partially liable for.

    I am sorry for your loss of self esteem. Keep in mind that your husband has lied to you and cheated on you. It is a reflection on him, not on you. It is time for you to move forward and protect yourself and begin to wipe yourself clean from this mess.

    Good luck and best wishes.

  38. @Q10, land in Alaska, student loans, and emergency fund:

    I would at first take all of that $900 a month and put it aside as income replacement money until you reach $5,000 or so. $2000 is not a lot of cushion for two people. After that, go after the land debt and cancel it out. If at any time your cushion (your total amount of cash available minus your average monthly expenses), then build it back to $5000 before resuming 100% debt payments.

    I’m curious how you have debt for land since most banks won’t lend you money for a land purchase. Maybe there is something different going on in Alaska, or maybe it’s a private debt.

    Anyways, that’s my take on it.

  39. I revise my advice above, q10. you have $4500 of extra income between now and May. I would hang onto all of it as cushion to add to your current $2000, so you have $6,500 total cushion. This is only 2.5 months’ worth of expenses and is not really a lot.

    After you transition to your new jobs, if you have extra money, then I would consider applying it towards the land debt first.

    However, you note that you have $2500 in monthly expenses. Is there any way to knock that down? Do you have cars that you are paying on, or is your rent higher than it needs to be for your income? Given that it only costs one person about $200 per month to eat (from the supermarket), I am wondering where the bulk of the $2500 is coming from…It’s not a super high amount but is there $200 or $200 that can be shaved off of it to give you more breathing room?

    Good luck.

  40. Q10, unless you are getting company match, I’d put that 12% in a separate bank account labeled “retirement contribution escrow 2011″ rather than contributing it to retirement over the next several months. With your current income of $3400 per month ($2500 of average monthly expense, plus your $900 extra you mentioned) , that’s $400 a month of extra cushion times 5 months, or another $2000 over five months at your command in the event of a severe issue with income. Put it in a separate account, such as at ING, with a name that identifies it as escrow funds so you don’t spend it unless absolutely necessary. It will put you at $8500 in cash, or 3.5 months’ worth of expenses, if you follow all of my advice about this in the previous comments. Once you get past this spring and get new employment and are surer on your feet, then you can resume retirement contributions and also put that retirement escrow money into your retirement account for the tax year of 2011.

  41. @” My mother is an invalid in this town so I go over just about every day after work to help my brother take care of her. I’m sinking.”

    How about combining households? Is one of these houses large enough and zoned correctly to make a *separate* apartment, with its own entrance and a kitchen, for Mom or for you?

  42. re: Q5- Investing while receiving SSDI:

    If, indeed, the writer is receiving Disability Insurance Benefits (commonly called SSDI), unearned income will have NO impact on the benefits.

    If the interest income plus the SSDI is high enough, it could make some portion of the benefits taxable for IRS purposes, but it doesn’t reduce the benefits themselves.

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