Questions About Furnaces, Focusing, Estate Planning, Watercooler Talk, and More!

What’s inside? Here are the questions answered in today’s reader mailbag, boiled down to summaries of five or fewer words. Click on the number to jump straight down to the question.
1. Buy it for life: jeans
2. Water bottle for life
3. Shopping around for a furnace
4. Getting “in the zone”
5. Thoughts on income property
6. Voluntary car repossession
7. Handling own estate planning
8. Figuring out financial focus
9. Large savings account balance
10. Figuring out benefits after move
11. Living trust payout questions
12. Handling political talk at work

I had this great conversation yesterday with a reader about how there are these moments in life when you somehow “get” yourself in a way that you previously hadn’t, and that moment signifies a sea change in your life. Something just clicks, you see the world and your life completely differently, and from there you move forward in a totally different direction.

This came up in the context of this reader’s financial turnaround, and I’m starting to realize, with some real reflection, that I’ve had about four of these in my adult life, with one of them happening just a few months ago. My reader had a similar epiphany during that same timeframe.

There are times when it feels like things are changing for you, but you still fall back into the same routines and habits, just in a different variation. I think for those habits to truly change, something has to switch inside of you, not outside.

Personal change comes from the inside. You can change where you live and what you own and what you’re doing for a living, but if you’re not changing as a person, you’re going to wind up in routines very similar to what you’ve always done with similar results.

The question is, how do you trigger that kind of change? Can you actually do anything to trigger it? I’m honestly not sure, but that’s the big question on my mind these days.

This week, we’re going to start off the mailbag with a few reader emails and Facebook comments regarding Saturday’s article on “buy it for life” items.

Q1: Buy it for life: jeans

I have a recommendation for the Jeans category. Rural King stores sell self branded jeans that are extremely durable for $10.00 a pair. The guys I know are rough on them. True outdoorsmen , who hunt camp, hike, fish etc. We all swear by them.
– Tom

I had several recommendations for simply buying jeans from the local farm supply store, of which Rural King is an example. Around here, the most common farm supply stores are Farm King, Thiessen’s, and Farm & Fleet. These stores tend to sell very inexpensive denim jeans that are cut in a very simple fashion, but the denim itself is minimally treated and rather thick, which means that they’ll last and last.

In other words, those jeans make for great outdoor work pants. When you’re often outdoors doing manual work, jeans from a farm supply store are a great choice if you’re looking for low cost durable jeans.

My experience is that they tend to be cut in a somewhat baggy way with the obvious intent to maximize function: they’re intended to cover your legs, give you good range of motion, and last a long time. They’re not intended to make you look shapely. That makes them an excellent “buy it for life” purchase for those purposes.

Q2: Water bottle for life

Take a look at Hydroflask for a good water bottle/thermos bottle. These are also guaranteed for life. Hot stays hot, cold stays cold. I have left mine in the hot car all day to find my water still cold. Dropped over and over, they keep the seal. Once I dropped a full bottle and chipped the lid. It was replaced quickly for free with no fuss.
– Marie

Neither I nor the people in my circle that I consulted for that article have any experience with Hydroflask as a water bottle or thermos, but two different readers recommended them (with Marie being the first).

Having said that, I looked into Hydroflask and it looks to me like many of the positive things that we stated about Nalgene and Klean Kanteen water bottles definitely apply to Hydroflasks, and they appear to be good hot water/soup bottles, too.

I’d likely put them in that same tier of “nearly indestructible water bottle / thermos” category with the ones listed in that article. At some point, I’ll probably pick one up.

Q3: Shopping around for a furnace

I’m saving up money for a new furnace… I’m assuming I will just have a few different companies come in and give me estimates. I want to get a good deal, but it’s also important to me to have something that will last a long time, and something that will be good, overall, for the environment. I’ve even thought about getting an estimate for geothermal heating? Are there other, similar options? How would you decide?
– Noelle

Honestly, I’d rely on this Consumer Reports article on gas furnace reliability and stick with options from the top few entries on the list. They tend to be very spot-on when it comes to identifying reliable brands.

As for a geothermal system, CR again covers the basics pretty well. They can definitely be worth it, but they almost always have a higher initial cost than other options. Initial cost, depending on your exact location, can run into the tens of thousands of dollars, which is a cost you won’t recoup for many, many years. It may increase the value of your home somewhat, but a geothermal system doesn’t have much curbside value when selling.

If I were you, I’d get quotes on a gas furnace and a geothermal system separately. Keep in mind that the geothermal system will cost more up front but will cost less each month after installation (usually around 25% less). Do the math and figure out which one is right for you. If you’re concerned about the environment, I’d put a little bit more focus on the geothermal side of the coin.

Q4: Getting “in the zone”

Those days where I can slip into the “zone” at work are so great and so productive. But do you have any tips and tricks for finding the zone? I can’t seem to get there consistently. I know you’ve written about it before, but I figured I’d ask again in case things have changed. I could use a productivity pick-me-up and this might help!
– Maxine

The best recipe I’ve found so far for getting “into the zone” with any consistency is to follow several principles all the time, because my best results come from using them in concert.

First, I practice mindful meditation a couple of times a day. Just close your eyes in a low-distraction place and focus on just your breathing for five or so minutes. If you feel your mind wandering, bring it back to your breathing. I tend to think of this as “bicep curls for my mental focusing ‘muscles.'” It really works.

Second, I get very hydrated and make sure I’m not hungry before I sit down to work. I drink a lot of water and eat a little something.

Third, I turn off every distraction that I possibly can, so that they don’t interrupt me. My cell phone is completely off, as are web browsers and other such things.

Fourth, I open up a notebook on the desk in front of me with a pen right there so that if a stray thought comes into my head that I should revisit, I jot it down and then let it drop from my mind and keep going.

Finally, I usually turn on some quiet instrumental music or ambient noise. I usually just look for ambient music on Youtube and listen to that.

That routine seems to produce the best results overall for me. I do find that drinking a cup of black coffee followed by a cup of green tea can boost my likelihood of getting into the zone, but I’m not sure if that’s a “placebo” effect or not. I’m pretty confident that the first five steps really help, but I’m not 100% sure on the coffee/tea combo.

Q5: Thoughts on income property

My partner and I are looking into buying a 3 bed/2 bath condo on a 15-year fixed mortgage in Richmond, VA. We are both 30 years old, unmarried (for now, that’ll change within a year or two). He’s a resident and I’m a program coordinator both at the same hospital. We will probably be in Richmond for another 4 years or so (my partner has to finish up residency and then fellowship) before we move to wherever he gets a job as an attending physician. Once he becomes an attending, we talked about buying a house and then using the condo as an income property whether we move or not. We would use a management agency instead of leasing the condo ourselves. Do you think it is wise for us to make that type of commitment? What is your feeling on income property?
– Kevin

It really depends on your financial state. If you’re in a position with secure high income and not a lot of other debts, it can be a reasonably good move. If you’re still going to be facing mountains of student loans, you don’t also want to be facing two mortgages at once, because you’re going to be walking a major tightrope that will cause the whole house of cards to fall apart if one thing goes wrong.

Income property often gets a much better rep than it deserves. When it works, it works well; when it backfires, it can backfire hard. If you end up owning an income property in an area where no one’s renting or will only rent if you put the rent price through the floor, you’re going to lose money on the deal. You’re going to be paying higher insurance rates on the property, property taxes, and management fees whether there’s a renter in place or not. Plus, if the renter doesn’t pay or damages the property or many other things, it’s going to cost you even more. You’ve got to be financially prepared to handle those challenges if they occur. If you find yourself in a situation where you can’t, you will be in a financial disaster.

To sum things up, income properties are a good idea if you have some money in the bank to back them up and aren’t loaded down with other debts. If you take on income properties when you’re already dealing with debt and don’t necessarily have a huge income, you’re begging for one bad event to wreck your whole situation.

Q6: Voluntary car repossession

My husband and I are working through austerity measures since he has been unemployed about 36 months since 2013. We purchased a truck during that time to try to expand a cleaning service however that income stream dried up. The truck is in excellent condition however the negative equity is probably around $10,000.

What is the best way to voluntarily surrender the car mitigating our losses? Also, we’d like to understand what steps we can take to recover from this experience.
– Clara

The best way is to go to the bank from which you got the car loan and talk to them directly about voluntary surrender. They may be able to work something out with you where it appears on your credit report as a “voluntary surrender” rather than as a “repossession” which will have a much better impact on your credit score.

However, given that you’re $10,000 underwater, the bank will probably expect you to make up that difference, and if you cannot, it will probably still be treated as a “repossession.”

Even then, you’re still going to be better off in terms of future business with that bank if you go in there and talk to them face to face about a voluntary surrender. It’s also less traumatic than a middle-of-the-night repossession of your truck!

Q7: Handling own estate planning

Say, you seem to be a DIY-KISS type of person, have you created a will? We have done a Nolo Will along with Power of Attorney, and Durable Power of Attorney for Healthcare and Advanced Directive in the past. We update them every decade. You can get the later forms at most hospitals.

How do you approach this topic?
– David

I usually encourage people to seek an attorney in their state to look over such documents and make sure they’re written and signed correctly. There are variations from state to state in terms of what’s expected.

A family lawyer can usually do this for you at a pretty cheap rate, especially if you’ve gone to the effort of figuring out the documents on your own and preparing a draft that presents your wishes. All a lawyer has to do in that case is to make sure you have all of the i’s dotted and t’s crossed for your state and that it’s all signed appropriately.

Using a service like LegalZoom is also an option, but I’ve found that their services tend to be comparable to the cost of a family lawyer. I’m not sold on how “cheap” they are.

Q8: Figuring out financial focus

I’ve been thinking about a lot of things since the new year:
My mortgage
My kids’ college funds
More life insurance
My student loans
My 403 b through work (maxing out this year)

Should I be putting money toward all of it?

We owe 780 k on a house no extra payments
We owe 350 k a rental house that is paying for itself
I have 56 k left in student loans putting an extra 250 a month to it payments 465/month
529s for my 2 kids 250/month (not sure how we’ll be able to afford 4 years of college for both now 6 and 2).
I want to get more life insurance no more than 20 dollars/month for. 500k x 20 years

My husband and I make over 200 k annually

Should I decrease my 403 contributions and knock down my student loans (rate of 2.875)?

I do live in Hawaii. Housing is expensive. The reason for the big mortgage is that it is in a nice area and it has an Ohana house (cottage for my in-laws) who are contributing 1700/mo for rent and utilities. It’s the main reason for me wanting to get additional life insurance. I currently only have a 500 k policy.

Any guidance you have would help.
– Kiara

With student loans below 3%, assuming they’re not adjustable rate loans, you should put them pretty low on the priority list. I would prioritize your own retirement over your children’s college funds, too, as your children can take out student loans if necessary but you can’t magically come up with retirement savings in 20 years.

Given the rather large debt load you carry and the fact that children are involved, I’d suggest that both you and your spouse have enough term life insurance to wipe out all of the debt should one of you pass away. Your income drops dramatically in that scenario, so not having those debt payments will be absolutely vital.

Given all of that, I’d probably put life insurance first, then retirement savings, then the mortgages, then college savings, then the student loans. Make sure you have each one completely in hand before moving on to the next one. The mortgages are the only piece that could move around easily on the list, because I don’t know what their interest rates are and whether those rates are adjustable.

Q9: Large savings account balance

I’ll be super honest about what I don’t know: I know nothing about investing. That said, I know I’m not doing as much as I could with my money. You write that you use Vanguard low-fee index funds. I had Vanguard for my 401k retirement savings at my last company. Can I just open a personal (non-retirement savings fund) with Vanguard? (Kind of lost in the details here of whether this should be mutual funds, ETFs, CDs/stocks/bonds – I don’t know the difference).

A little about my background: I’m 24.5 years old (turning 25 in July), and graduated college in May 2014. I had some side jobs on top of my day job, which I worked at for two years. I started law school in August of 2016. While I was working, I worked and saved pretty aggressively, and I still work a little bit now that I’m in school. My mom is paying for my law school cost of attendance (and she paid for my college cost of attendance too), which means I have my entire savings freed up from school costs.

I currently have $274,000 in my savings account (which barely earns any interest, like I get $2 per month in interest). I just moved that money into a money market account that’s giving me 1% in interest, but that’s a special offer and will go away in another couple months, I believe. I also have $41,000 in my Vanguard retirement savings. I randomly selected the Vanguard plan since I didn’t know which one to pick. It’s the “retire in 2055 plan” or something like that, and is defaulted at 90% stock and 10% bonds.

I want to move the full $274,000 to somewhere that earns more than $2 per month in interest but really am at such a loss as to where to start. I feel comfortable moving the full amount because I’m still working a little bit, and can always use any new income generated as needed. Also, my cost of attendance in school is covered. I really want to follow what you’ve done (because it seems like it’s worked out so well for you!). So, I plan on calling up Vanguard customer support to help me open the low-fee index funds. Is that all I need to tell them or do I need to have the mutual fund vs. ETF stuff mapped out? You wrote in another post to someone that he/she should get Voyager status. I don’t know what that is.

I tried calling them yesterday about moving my 401K to 100% stocks, but I didn’t know which plan to pick, so ultimately hung up having changed nothing about my plan.

I apologize because this question makes me look so ignorant. I keep putting this off because I’m so in the dark, but I used to keep my money in a checking account (earning no interest at all) and just moved it into a savings account recently, and the reason for that long delay is that I know nothing about investing or “growing money!” I would really appreciate your insight!
– Elaine

Having more than $250,000 in a savings account is a poor idea because it exceeds the amount insured by the FDIC. If your bank went belly up, you would just lose everything above $250,000.

I would not move the full $274,000 because you do need an emergency fund in case of a major unexpected event. I’d probably keep somewhere around $5,000 in savings and move the rest somewhere else.

So, what do you do with the $269,000? The best thing for you to do, honestly, is figure out what your goal is with that money. What do you want to do with it? Is it intended to help you retire early? Do you intend to use it to buy a home in five or ten years? The big thing you need to figure out is your timeline and how much risk you can tolerate with it. If you don’t have a goal with it, I wouldn’t put it in anything very volatile. A money market would be reasonable, and Vanguard offers a good money market if you want to just put it in there. You could put it into your Vanguard account and stick it into their Money Market Prime fund outside of retirement money and just sit on it for a while until you evaluate your goals a little.

Once you figure out what you want to do with the money, I’d suggest putting the money into stocks if the goal is ten or more years out. Otherwise, keep it in something less volatile like the money market or in highly rated bonds.

As for the money in Vanguard, if you want your Vanguard money to be in 100% stocks, your best bet is the Vanguard Total Stock Market Index, which basically includes all publicly traded stocks in the United States all wrapped up into one fund. Given your young age, having your retirement money in there is fine, but in ten years or so, you’ll probably want to shift it to a target retirement fund because you’ll want to slowly ratchet down the stock exposure, though you can make that decision when you get there.

Q10: Figuring out benefits after moving

I am currently on disability in the state of FL, my question is IF I move from FL to MI (or any other state for that matter) I am curious as to wether my benefits amount will change? The amount I relieve in my state is significantly below that which you show on your web site. I also have an Autistic/Bi-polar son on benefits and his is quite a bit (more than 50% less than that shown on your site).

I’m just curious, as we are thinking of relocating for his education/schooling and it’s quite a significant difference. Or would I be locked in at where I am now?
– Jana

It sounds like you are both on SSDI – Social Security Disability Insurance. Those benefits do not vary from state to state.

If you are on SSI – Supplemental Security Income – which I don’t think you are, those do vary a little from state to state. You’ll want to see what the difference is in your destination state.

When using online calculators, you have to be putting in fully accurate information and you have to make sure that the calculator you’re using is matched correctly with your situation. If you’re just accepting defaults or using the wrong kind of calculator, the results are often going to be wrong.

If you’re uncertain, I would contact the Social Security office by phone at 1-800-772-1213.

Q11: Living trust payout questions

At my father’s death, I received a payout from a living trust. I have not been able to get any information from the investment company and don’t know who his wife’s attorney may be. So, that leads me to you. Do I pay tax on this? Can I put it into 401(k)s or something to delay the taxes?

The details- the check is $34,000. My husband and I are in our late 50s. We owe $34,000 on our home. He is self employed and has NO retirement. I have a plan thru my job and a very small 401. Please give me some scenarios or ideas. We have never been in this position and while others have suggested a honeymoon or vacation that we’ve never taken in 38 years, that just doesn’t seem to be the best use of these resources.

Asking your thoughts as a totally uninterested party. My husband is concerned that an investment company would be driven to their best interests, not ours.

Hope this reaches you. I wasn’t able to find any contact info on your website or newsletter. Then again, computers are not my thing- we still have flip phones!
– Florence

I have a number of additional questions about your situation here before I could ever give you a good answer. My honest suggestion is to call a tax lawyer in your area and pay the small fee that the lawyer would charge you to make sure that you’re doing this correctly.

The penalties for doing this wrong would vastly exceed the cost of the lawyer, so you’re far better off putting up the money now and doing it right initially.

Q12: Handling political talk at work

I work with two gentlemen in their fifties who have worked at the company for decades. For the first few years I worked here, everything was fine and our office chitchat mostly revolved around movies and sports. In 2015, though, this all changed. One of them got really into the Donald Trump campaign and soon the other guy was on board too. Nowadays they talk about politics at every free second at the watercooler. They openly talk about how they think everyone who is liberal is basically pure evil and laud every single Trump statement and policy and they do it very loudly.

I’m a political moderate and I’m completely tired of it. I know a couple of people in our office are fairly liberal and there are times when they look like they’re about ready to snap or burst into tears. Two different people have left in the last six months, mostly due to the office talk from what they said to me on Facebook afterwards.

There have been informal complaints made, but the person who hears them seems to largely agree with their viewpoints and does nothing. Our immediate supervisor just does not seem to care either as he is of the perspective that you should just blow off comments you don’t agree with.

I don’t know how to handle this situation and I hope you’ll have some sage advice.
– Alex

First of all, politics should not be discussed in a workplace environment regardless of how confident you are that everyone else agrees with you. It doesn’t matter whether you’re politically liberal or conservative, it doesn’t belong in the workplace. You can be politically active as much as you’d like in your personal life, but in the office (or in professional meetings and such), political talk should be checked. This kind of talk isn’t professionally appropriate regardless of your political leanings. It’s unacceptable whether you’re conservative or liberal.

I think your best approach is to simply invite those two to a private meeting of some kind – perhaps going out to lunch together – and simply tell them that their political views are perfectly fine, but their abrasive political speech is alienating coworkers and damaging their professional relationships. Make it clear that a number of people in the office don’t agree with them but that they’re attempting to be professional about it. What you’re doing here is giving them the benefit of the doubt that they’re unaware of the impact they’re having on others and how they’re acting unprofessionally.

If they choose to continue, then you should look into other options. Such talk damages the bottom line of the company, so I would bring it up with someone whose financial interests are affected by this behavior, such as a company owner or a higher level management person. Bypass the ineffective people and talk to people further up the ladder. Just request a meeting and make it clear that you don’t care about the politics, but that you do care about having a happy workplace and that many people are disgruntled by the talk and are feeling unhappy and are shutting down in terms of their workplace interactions and discussions and how that’s affecting the bottom line of everyone’s work productivity.

That’s the exact approach I’d follow. I’d make my case first to the coworkers and if that fails, I’d go to someone whose financial interests are on the line.

Got any questions? The best way to ask is to follow me on Facebook and ask questions directly there. I’ll attempt to answer them in a future mailbag (which, by way of full disclosure, may also get re-posted on other websites that pick up my blog). However, I do receive many, many questions per week, so I may not necessarily be able to answer yours.

Trent Hamm

Founder & Columnist

Trent Hamm founded The Simple Dollar in 2006 and still writes a daily column on personal finance. He’s the author of three books published by Simon & Schuster and Financial Times Press, has contributed to Business Insider, US News & World Report, Yahoo Finance, and Lifehacker, and his financial advice has been featured in The New York Times, TIME, Forbes, The Guardian, and elsewhere.