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. AAA alternatives?
2. Roth IRA for younger investor
3. Using Disney rewards credit card
4. Automated percentage savings
5. Switching to rechargeable batteries
6. Reality of quilting business?
7. Rustproofing recommendations
8. When to throw out socks?
9. Ben Franklin and success
10. Choosing guardians for my children
11. Finding new tax preparer
12. Productivity or time management books?
The most frustrating aspect of my life is that there is no such thing as a routine week. A week doesn’t go by without something incredibly disruptive to the ordinary flow of a day.
One day, I’m pulled out of bed in the middle of the night by a puking child. There have been four different visits to the doctor’s office. I have to spend two days going to another state on an emergency trip. Family members visit and stay for parts of four days, disrupting every normal household routine. That’s just in one single six day period.
There are times when I find it practically impossible to establish new routines and habits because my life is tossed so many curveballs and twists and turns all the time.
I haven’t yet found a magic solution for any of it, but I do know it’s frustrating to feel like you’re constantly juggling your work routines and life routines to fit the needs of everyone else. It’s a frustration I’ve felt almost constantly for the last four months or so.
I hope you’ll mention alternative road service providers, such as The Better World Club. AAA spends a lot of members’ money on anti-environmental and/or pro auto industry lobbying that few people are aware of and many might disagree with. Even the Car Talk guys recommend looking elsewhere for this reason. While AAA has saved my bacon on more than one occasion, I also had an extremely bad experience with them, which, combined with the aforementioned misallocation of resources, prompted me to quit. In the Internet age, some of their ancillary services, like free maps, tour books, and tour guide services, are a lot less valuable than they once were. Initially I worried about losing discounts on hotels, Amtrak, and other services, but in the decade or so I’ve been away, I’ve only missed these perks maybe half a dozen times. Amtrak, ironically, offers no comparable non-AAA discounts that I’m aware of, but many hotels and such do.
I get many such emails criticizing specific groups and companies and I rarely include them in the mailbag because they’re usually hard to verify, but with this one, I was able to track down the surprising amount of lobbying that AAA does.
They’ve lobbied Congress in the past to raise the gas tax to build more highways but not raise gas taxes to improve conservation efforts. They also opposed the Clean Air Act, among many other stances.
They seem to spend a lot of money and effort on quiet political activism, which is something I didn’t know about the AAA before this. Regardless of your feelings on the stances they’ve taken, it’s worthwhile to note that they do spend significant money on political activism and not on features of AAA membership like roadside assistance or other consumer assistance programs.
I am a youngling just about to turn 25. My company provides a 3% match in a Vanguard SIMPLE IRA which I have taken for 2 years thus far. I am planning on paying off my debt next year and would like to begin building up retirement savings. I also have some funds with Betterment in regular investing. I have been told that while I am in a lower bracket, it is best to invest in Roth IRA’s which is what I plan to do.
Do you suggest I go with Vanguard, Betterment, or other? And if I do Vanguard, how do you suggest I invest my funds in both the SIMPLE and Roth? (Roth allows ETFs?)
My current Vanguard setup is with 3 funds, but $25/fund are eaten up by fees. I only have about $4,500 so far, but will have closer to $7,500 next summer after I receive my employer match (sadly on an annual basis rather than monthly). Would you suggest a better setup, i.e. fewer funds? I’m currently mixed up with a 2055 retirement fund, Total Stock Market Fund, and International Stock Market Fund. Roughly a 40/50/10 % allocation, respectively. 95% stock 5% Bond.
Any guidance would be appreciated and considered. I am an accountant, but I don’t know much about retirement planning aside from the general advice that we hear all the time – fewer eggs in one basket, lower fees, etc. And it would seem that advice with Funds would be slightly different than advice with individual stocks.
I’ve been a happy Vanguard customer for many years and I think their funds are a great value, so Vanguard is going to get my recommendation when it comes to an investment house. I have my own Roth IRA with them, with all of the money in that IRA invested in a Target Retirement Fund.
Here’s a summary of the fees that Vanguard charges with tips on how to avoid them. If you sign up for electronic delivery of statements and migrate your holdings to a single fund (like a Target Retirement Fund) for now, you’ll wipe out most of those fees, and the remaining ones will go away once your balance reaches $50,000. You can re-diversify once your balance is higher.
I think that if you’re wanting to handle your own diversification across multiple funds, you’re better off not having a Target Retirement Fund involved in the mix. The point of a Target Retirement fund is that it balances itself toward the retirement date you select; if you don’t like how it’s balanced, then you’re involved enough that you should be selecting the funds yourself. Honestly, if I were you, this far out, I’d have all of it in the stock funds evenly split between them (or something close) and then move some of it into bond funds much further down the road. I don’t see what benefit having that third Target Retirement fund in there is giving you at this point, since you desire your own balancing.
I am a newcomer to using credit cards for rewards and I am looking for a way to lessen the expense to disney world for my family of 5. I have already booked our trip as a package to stay on site at disney world but I have not paid for it in full. If I get the Barclay travel card or another travel card and pay for the trip with that card will the card let me use its rewards as a statement credit toward my account?
There are many different rewards cards out there with different strategies for redemption. The Disney Visa card from Chase, for example, pays out rewards in the form of a gift card that you can use on site when you get there – here’s the details on that.
If you get a travel card that’s intended to help with the cost of the stay, you’re going to need to make sure you can actually apply it to the trip. I’m not sure whether or not you’ll be able to apply any points or rewards you earn at this point.
I think your best bet for helping with your trip – the one I’m sure will help at this point – is the Chase Disney card above, as you can redeem those rewards for gift cards that work on-site at Disney World.
I run a small business and would love a way to automatically save (from my business revenues) X PERCENTAGE (not DOLLAR amount) AUTOMATICALLY to a separate savings account. ie:
$1,000 comes in via revenues/customer purchases
$100 goes out to this external online savings account that is harder to touch/withdraw from (use it for a savings goal like House purchase deposit, etc)
$900 goes off to the normal biz checking account
I cannot find any way to do as I mention above automatically and % based, only dollar amount. So as a small biz owner with monies fluctuating each month, rather than me just put a dollar amount of my paycheck aside each month, I want to take a % off the top each month before I see/get antsy to spend it, and set it aside.
Thanks for letting me know if you know such a way!
There isn’t an easy way to do this that I’m aware of, though it seems like a feature that an online bank could implement pretty easily. I looked through the information I had on a bunch of online banks and none of them seemed to have a feature anywhere close to this.
My income is somewhat variable as well. My strategy for automated savings is to do it on an automated basis based on a very low end estimate of my income, then I occasionally go in and manually move some more over to savings. Without some kind of percentage-based system, I don’t really trust any other method.
Is it better to switch all of the batteries in the house to rechargeable batteries all at once or to do it slowly? I have some Amazon credit and realized how much we spend on batteries so I was thinking of using the credit to buy a charger and a bunch of AA and AAA batteries. Brand recommendations while I’m at it?
It’s better to switch everything all at once, but that does not mean going through your house and pulling perfectly good batteries out of devices. Instead, buy enough batteries to cover all of your needs and as the current ones die out, replace them with rechargeables.
If you have some extra unused non-rechargeable batteries in drawers, you may want to use them first before switching to the rechargeables. Leaving the non-rechargeables in a drawer means that they’ll eventually lose charge and go bad; use them now while they still have maximum value.
Aside from that, I’m completely on board the rechargeable battery train. I recommend using eneloop rechargeable batteries, made by Sanyo.
My grandmother has made quilts her entire life and owns a huge longarm quilting machine. I am the only grandchild who has been interested in her quilting and so recently she told me she was no longer going to make quilts because of her declining vision and offered to give me the machine. She says she will help me learn how to use it and walk me through some simple patterns.
While I wouldn’t mind being able to make a few quilts for friends and family, the quilting machine is going to take up a lot of room in my apartment. I live in a one room studio and the quilting machine and other materials would probably take up a quarter of the space.
So now I’m trying to assess the reality of doing this as a business. I don’t want to fill a quarter of my apartment with something that just sits there and making quilts for the sake of making quilts is expensive.
You can sell quilts for a lot on etsy but they’re really good quilts made with a skill level and an eye for design that I don’t yet have if I ever will.
Just hoping for some insights or food for thought here.
More than anything, I think the question comes down to you. Does this quilting business seem like something you personally want to do and would enjoy, or is it something you’re doing because it feels like “tradition” or because you’re pleasing your grandmother?
In other words, without the presence of your grandmother, would you be considering starting a quilting business if an appropriate quilting machine dropped on your lap? Is it something you personally get a lot of enjoyment from?
If it is, then dive in. You’ll make some money from it and you’ll get a lot of personal enjoyment along the way. If it’s not something you love, then you might not want to do this.
Is rustproofing a worthwhile investment in a car? Does it matter based on how far north you live? Recommendations?
I think it depends on a lot of different factors, including your climate. The further north you live, the more exposure your car is going to have to the salts and other materials that are put on roads to make them passable in the winter months, which means a greater chance of rust. On the other hand, newer cars already come with pretty good corrosion protection built into them so that they won’t rust very easily – they certainly can rust, but it just takes a lot longer than with older cars.
My sense, after doing some reading on the subject, is that if you live in an area where there are only one or two (or fewer) winter storms a year, it’s probably not worth your money. If you live further north where winter storms are a regular occurrence, then rustproofing is probably worthwhile if you plan on owning the car for more than a couple of years.
My recommendation is to have someone local and trusted apply it and choose the drip oil spray option. Then, park the car in a place where dripping oil won’t be a problem for a couple of days.
Hubby keeps wearing socks until they’re embarrassing. I throw them out when I get the chance but he gets mad if he finds them gone. When should socks be thrown away?
I don’t think there’s a hard and fast time to throw socks away. Different people will have different feelings on the subject and there’s nothing right or wrong about it.
Wearing a sock with a hole in it around the house isn’t a major disaster, in my opinion. I do it sometimes, as does my wife. I keep a few pairs with just a hole or two around for “house socks” to wear when I don’t plan to leave the property.
I do tend to avoid socks with holes in them when I leave home, though.
Found this article from The Atlantic: How America Lost Track of Benjamin Franklin’s Definition of Success. Thought you and your readers might enjoy it!
Basically, Benjamin Franklin retired early, at age 42, from his printing business. He had used the proceeds of that business to invest in many different things, so he was actually financially independent at that point and could spend the rest of his life doing whatever he wished. It is during that later period that he did virtually everything he was famous for – his experiments with electricity and his work as a statesman all occurred during his early retirement.
It’s a really good article and it brings up the powerful question of why relatively few people follow Ben’s example today. What changed?
I think the biggest thing that changed is that people have a much, much higher expectation of standard of living today than they had in Ben Franklin’s day. The idea of a utility bill didn’t exist back then. Neither did most loans, at least in the modern sense, as banking as we think of it today didn’t really exist. Most people lived in very humble homes with dirt floors and heated them with wood they chopped themselves.
It was a different life, one that didn’t involve a constant outflow of money and one that didn’t involve debt approaching six figures to have a craftsman’s job.
Wonderful article, well worth reading.
I am a 26 year old single mother of three. Their father died of an undiagnosed heart condition two years ago. Thankfully we had life insurance and I have a good job so we are actually really financially stable.
I am struggling with guardianship issues. When I initially revised my will after my husband’s death, I instinctively put my parents down as guardians for my children. Since then, my father has begun to show early signs of ALS so I do not want to have that burden on their shoulders.
I have two older siblings. One is married with one child of their own, but they do not have much money and they seem to struggle with staying employed. The other is single with a very successful career. Both have said that they will happily take on guardianship.
How do I decide which one is the right choice?
This is a decision that Sarah and I struggled with for a long time and, after having listed several different people as guardians, we did finally settle on her sister as our final choice.
I think, for you, your only concern would be which situation would be best for your children. If you get a “yes” response from someone, then your only consideration should be whether that household is the best option. You know the temperament of your siblings and you probably have a good grasp on what kind of parenting style they would each have. Which is the one you would approve of the most? Which one would provide the most nurturing environment?
In the end, you should follow what is in the best interest of your children, period. I do not believe that financial success is a strong indication of that, either. It has a lot more to do with the character of the potential guardians.
My long time tax preparer is retiring at the end of the year. How do I find a new tax preparer that I can trust? Don’t want to go to the big firms.
Ask your retiring tax preparer for a recommendation. That’s absolutely where I would start.
My guess is that you’ll have some interaction with this preparer in the next month or two as you gather materials to move on to another preparer. Ask your old preparer at that time. If there isn’t such an opportunity, just pick up the phone and make a call.
It’s likely that your old preparer knows quite a few other preparers in the area and can make a good recommendation for you. Unless there are mitigating reasons not to do so, I’d just follow that advice.
What books do you suggest reading on productivity or time management? I need to get more organized in terms of how I use my time.
I read a lot of books in this vein. I find them interesting and inspiring and they almost always offer me some tweaks for what I’m doing.
The first book I’d recommend is David Allen’s Getting Things Done, which I’ve written about extensively in the past. It’s absolutely the best book I’ve ever read on setting up a sensible time management system.
I think a morning routine is invaluable, so I’d also point at The 5 AM Miracle by Jeff Sanders. When I can maintain a good morning routine, my life feels exponentially more productive, and this book is a home run when it comes to building a good morning routine as the foundation of your day.
A final book I’d point at is Essentialism by Greg McKeown. This book focuses more on finding ways to cut out less-essential tasks so that you have more time to focus on the things you personally find the most important in your life.
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.