Reader Mailbag #28

Each Monday, The Simple Dollar opens up the reader mailbags and answers ten to twenty simple questions offered up by the readers on personal finance topics and many other things. Got a question? Ask it in the comments. You might also enjoy the archive of earlier reader mailbags.

As usual, we’ll start things off with a few links to older articles that directly answer questions I’ve heard recently.
Sharing a $3 candy bar with my wife and son
How to deal with those old baseball cards
The financial benefits of a good night’s sleep
And now for some great reader questions!

What are some of your favorite fictional “poor and making it” books?
– Jessica

In your email, you mentioned A Tree Grows in Brooklyn by Betty Smith, which is an excellent choice. I’d also recommend Tess of the D’Urbervilles by Thomas Hardy (a young lady comes from a poor home with a drunken father and has to make her own way in the world) and The Color Purple by Alice Walker (the socially low and impoverished position of African-American women in rural Georgia in the 1930s), and pretty much anything by John Steinbeck (I loved Cannery Row and The Grapes of Wrath), although Steinbeck’s characters tend to have a lot of trouble “making it.” To Kill a Mockingbird by Harper Lee and The Good Earth by Pearl Buck are also good picks along those lines.

Those selections should give you plenty to read for a good long while. Since many are older, I’d suggest hitting a used book store or PaperBackSwap to find them on the cheap.

You have great pictures to go along with most posts. Where do you get them from?
– Justin

I use Flickr to find them, but I use only images that people allow to be used for commercial use. I’m a pretty big believer in sharing creative works, so I like using the work that others have produced and share with others.

I found the idea on Seth Godin’s blog, where he wrote about how to find free interesting images. I use his method, then use the “blog this” option in Flickr to get the code. Each of these “shared” pictures that I use is linked right back to more pictures by that artist.

When you see an interesting image I’m using in a post, put your mouse over it. You’ll see the title of the picture and who took it. Click on the picture to see more good stuff by that person.

My wife and I have recently been transferred overseas for a two year assignment. Prior to leaving the US, my company bought both our vehicles and my house – thereby leaving us with absolutely no debt…no credit cards, student loans, etc. The best thing about this assignment is that my company covers almost all my expenses (rent, car lease, insurance, etc). This leaves almost my entire paycheck free as disposable income.

I did a poor job saving up until this point in my life (I’m 34). With the current stock market conditions, where would you suggest I place my savings? I’ve been piling it up in a money market for 6 months now. I max out my 401k, so I’m not sure whether I should be placing the money in an IRA.

What would be your strategy for returning to the US where I’ll need to buy cars and find a place to live? It’s nice to be debt free, and I’m not sure I want to return to the old way!!
– Edward

If your goal is just to have a lot of cash when you return in two years, I’d put it someplace safe in the short term – not stocks. Put it in a high interest savings account or into bonds. Stocks are not a stable investment over a relatively short period like that.

Of course, if you’re overseas with no real connections to coming back to the United States, you may eventually choose to renew your option to stay over there. If you’re strongly considering a longer sojourn overseas, you can start thinking about stocks as a bigger piece of your “come home” money.

Got a video game question for your next Mailbag! What strategies do you use to keep yourself from getting sucked into a game for hours? I normally try to limit myself to an hour session, but I end up getting so caught up in the action/drama of the game I can’t stop. I tell myself, “as soon as I beat such and such level, I’ll quit”, but then something awesome happens and I keep playing.
– Matt R.

My video game sessions are naturally limited by tiredness or children waking up from naps, so this isn’t really a problem for me any more. However, when I was in college, staying up all night to beat Final Fantasy IX or GoldenEye was a pretty common thing.

My solution for that was to simply get all of the important stuff out of the way before I even started a session, so that if I did wind up getting sucked in, I didn’t fail at anything important. I’d get my homework done, my dorm room cleaned, and anything else that needed doing before I’d ever sit down for a gaming session. That way, there were no worries about playing more than I should.

Our family has come a long way toward financial simplicity and debt-free living. Now we have set a goal that is really stretching us: We are trying to save about $10000 extra by the end of 2008, so the whole family can visit our daughter in the Philippines. So my question is, do you have ideas for family fund-raisers? I don’t think a lemonade stand would quite be the thing in this case. We’re looking for ideas to raise extra money together, that the kids can be involved in.
– James

If there was a fun family activity that could raise $10,000 in four months, a lot of families would be doing that fun family activity.

One possible way to raise at least some money is to have a “neighborhood yard sale.” What you do is this: just go to all of your neighbors on the block and say you’re going to have a giant yard sale. Offer to do all the selling work for any items they might want to get rid of in exchange for an even split of the proceeds. Doing this makes it very convenient for those people to get rid of any stuff they might not want. Then, just mark the items from each house with a special colored sticker and keep track of those sales so you can deliver half the proceeds. At the yard sale, you can have the kids sell cookies and lemonade to help with the trip.

I’d also consider having lots of “free weekends,” where you stay at home, don’t spend anything at all, and just play in the yard and eat whatever you can find in the cupboards. Then, estimate how much you would have spent living it up that weekend and put that much into savings.

I know there are plugins for a blog that will allow a user to automatically follow a particular thread via notifications. Are there any drawbacks to using those? Would it be appropriate for you to put one on your blog?
– Jeff R.

I don’t like those because of the easy potential for spam. I’ve had people post comments on other blogs using my email address to notify me of comments – and I wasn’t amused, both at the blog in question and at the person who set up the fakery.

Besides, there are enough comments on popular threads here that it would resort in a flood of email.

If you’re interested in comments, you can simply bookmark the page, or go back to the home page and find it again.

What do you think of Dave Ramsey telling his listeners that they can take 8-10% from their retirement fund every year without any worry of running out of money?
– T.J.

I think Dave’s making a very big assumption about retirement. He’s looking at people retiring at age 65, living roughly until their life expectancy is over (age 75 or so), then dying. If that’s the case, then you can get away with spending that much.

But let’s say you retire at 65 and live until you’re 100. If you spend every year taking out 10% of your starting balance, you’re going to be broke by the time you’re 80 – 85 to 90 if you happen to retire at the start of a stock market boom.

Given that life expectancies are continually growing, I think it’s silly to assume such a thing.

Do you believe homosexuals should have the right to marry?
– Fred

I believe that individuals should have the right to privacy – the ability to live out their own lives according to the choices they make, as long as that freedom doesn’t infringe on my ability to do the same. You do what you want in your house, I’ll do what I want in mine, and nary the twain shall meet.

For me, marriage is a loaded word tied to religious choices, and I believe in the separation of church and state. Churches should not be required to marry homosexuals if they choose not to, but at the same time, churches should not be required to marry heterosexuals if they choose not to. A church should be a private organization capable of making their own rules and maintaining their own beliefs. The state should not be involved in marriage.

For the purposes of citizenship, taxation, and intestacy, the state should allow individuals to designate domestic partners of their own choosing with some restrictions on that so that it isn’t abused as a citizenship path. The state should not care about religious beliefs or personal practices as long as they don’t interfere with the rights of others.

I might not like or agree with the way someone else lives, but if they’re conducting their own private life distinct from mine and not obstructing mine, they should have the full right to do what they want. That’s being human. That’s freedom. Part of freedom is that others are going to do things you don’t agree with and you don’t consider morally right, but if you start restricting the freedoms of others to do things that don’t affect you simply because you don’t like them, who’s to say that one day the tables won’t turn and the people you don’t like will dictate their moral terms to you?

Is it ethical to panhandle for money? Is it right to give money to panhandlers?
– Connie

I tend not to give money to people just panhandling. There are resources available in every community to help people get back on their feet and I prefer to give my money there, where my money and effort will turn into food and water and a comfortable bed and job services instead of going to whatever whims the panhandlers choose to spend their money on. I’d rather address the basic needs of those who are actually trying to help themselves.

On the other hand, I often will drop some change in the guitar case of someone playing skillfully on the street corner. I saw a street corner trio playing for free once, blowing out the most upbeat rendition of “When The Saints Go Marching In” I’ve ever heard, and I was very happy to throw a few dollars in their case. That’s a value exchange – they enriched my life, so I’ll gladly enrich them, too.

Is it right to panhandle? People are free to do what they choose. The fact that they do it at all means that they achieve some level of success at it.

If you moved to a new area where you didn’t know anyone at all, how would you go about making new friends? I hate the idea of the “club scene” and “bar scene.”
– Jon

First, I’d get to know my neighbors. I built up a good friendship with a few people in my apartment building several years ago that I probably would not have met without making that initial effort.

I’d also scour the community for businesses and organizations that matched my personal interests and get involved in any social events that revolved around my interests. If you like to read, hit the book clubs. If you like to golf, hit the local parks and recreation center. If you like to garden, also hit the parks and recreation center. If you like politics, stop by city hall or the local party offices.

More than anything, though, just get out of the house and find stuff that interests you. Do it often enough and be willing to talk to others and you’ll find friends over time.

Got any questions? Ask them in the comments and I’ll use them in future mailbags.