Reader Mailbag #43

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. Here are some ideas on New Year’s resolutions from years past on The Simple Dollar.
How to Define and Stick To a Successful New Year’s Resolution, Financial or Otherwise
Why New Year’s Resolutions Fail (Especially Financial Ones) – And How You Can Make Yours Succeed

And now for some reader questions!

don’t you have a laptop computer that should work through power outages? And if power outages threaten your income, wouldn’t you consider it wise to purchase a generator?
– George

While I think it would be fun to have a tax-deductible reason to get a home generator, I really don’t have a need for it. Quite a lot of my writing activity happens far away from the keyboard, as I jot down notes here and there and work out posts in my head before I ever sit down. The biggest purpose of the computer, actually, is to actually finish composing and then posting articles, which is something that can wait.

I do have a laptop that I could use in a pinch, but it would be useless for posting articles in a power outage, because when the power is out, we don’t have internet access even if the router in the house is powered up.

What steps did you take to obtain corporate advertising on your blog?
– Lauren

The first step I took was to simply sign up for Google AdSense. Through that program, Google basically just supplies you with a bit of code for your site, then they do all the work of finding advertisers and matching appropriate ones (well, mostly appropriate ones) with your website. They do all this automatically.

Another good place to get ads if you’re a blogger is BlogAds, where advertisers go to target specific sites. The income is more irregular than with AdSense, but you have a lot more control over the ads that are delivered to your site.

After that, most of the subsequent offers came to me once my site reached a certain size. Advertisers of all stripes contact me, but I’m pretty selective on the ads I accept.

If we could get a mortgage payment lower than what we would pay for rent, is it better to save the money for a downpayment on a house, or are we better off knocking down a lot more debt before we take on such a huge financial commitment?
– Bekki

If the debt is high interest (which is how I’d describe anything over about 7% interest), I’d unquestionably knock down the debt first. Not only do high-interest debts squeeze your monthly budget tight, they also tend to hurt your credit rating if you have a substantial amount, which means you’d get a worse rate on your mortgage.

Owning a house comes with a lot of additional effort and expense that many first-time homeowners don’t see coming. You’re suddenly responsible for all of the maintenance of the home and the lawn, for starters, and you’re now on the hook for homeowners’ insurance and property tax. It’s not a leap you necessarily want to make just because the mortgage payment is a bit lower than your rent bill.

Since you mentioned that you liked the Watchmen novel, are you looking forward to the movie?
– Toni

Not at all. I’m almost always disappointed by film adaptations of books that I love, and I don’t see any reason to expect that Watchmen will be any different.

I can only think of a very small number of film adaptations of books that I actually liked and those were ones where a huge amount of liberty was taken with the original book, often to the point where the book and the movie are basically different stories.

I recently bought term life insurance. My work place also provides Group Life Insurance at much reduced cost as a benefit. I could get almost equivalent coverage (7X salary) from this option. I had heard that Group Life policies are very restrictive. But with 7X coverage, would it be terrible to switch to the life insurance from work and ditch my individual policy?
– Pankaj

While that might look like a good move at first glance, the problem with a life insurance plan through your workplace is that if you were to ever leave employment with that company, you’re no longer covered.

What does that leave you with? You’re suddenly older and left completely without a life insurance policy. If you wait until then to turn to private coverage, you’ll be saddled with a substantially higher rate than you are now.

My advice is to balance the two, actually. Make sure that you’re not uninsured when you leave your employer, but also take advantage of the benefit you’re being provided. I’d probably split my life insurance between the two.

Of all of the magazines you subscribe to, which one do you enjoy the most?
– Lily

The Atlantic gets the most attention per issue, easily, but each issue of that magazine has a ton of good content.

Over the course of a year, I probably spend the most time with The New Yorker, but it’s a weekly magazine, not a monthly. I usually read two or three of the feature articles in each issue, each of which are ten pages long or so.

Most of the other magazines I read tend to get less focus per issue than those two, usually because I tend to just browse through them rather than read them carefully in depth.

Even for a single person – how much higher does your salary have to be to make it worthwhile to uproot, sell your house and move somewhere else? And in our case, with the ridiculous car debt, how much does that skew the options?
– BudgetBride

It depends on where you’re moving from and moving to. If you’re moving from New York City to Omaha, Nebraska, for example, you can accept a substantially lower salary and still be cash ahead in making the move.

I think that, in any move, you need to be content with the change that you’re making. Are you moving towards something you actually want? If the move is going to make your life miserable, there’s no price that’s worth it. On the other hand, if you’re dreaming of making that move, then you can probably handle a pretty steep fall in income.

Do you listen to classical music? What classical music do you like?
– Edgar

I often listen to classical music while writing. I usually download a classical album or two each month from emusic and enjoy most of the picks that I’ve made.

The best thing I’ve heard in a long time, though, is Simone Dinnerstein’s interpretation of Bach’s Goldberg Variations. It’s absolutely magnificent from beginning to end – I love the music and I love the performance of it. To me, this is what good classical music is all about.

I’m seriously dating a woman with a bad spending habit. I’d like to spend the rest of my life with her, but I’m concerned that if she can’t get her finances under control now, how will she ever deal with making mortgage payments and having more than her own mouth to feed? And how do I convince her that just because she can afford something, that doesn’t mean it’s a good idea to buy it (especially when she truly convinces herself that she *needs* the new BMW)?
– Dave

It’s clear from this that you and your partner are in very different places when it comes to spending, and unless you get on the same page, things are not going to work out.

You need to have a very serious heart to heart about money, possibly with a counselor involved. If you’re met with a constant wall of denial and rejection, then it may not bode well for the long-term future of your relationship, because it indicates an unwillingness to work through problems.

If you decide to overlook it, you’re likely going to either have to subscribe to her spending philosophies (and spend your life constantly running on the treadmill) or spend all of your time being a frugal counterweight to keep your head above water.

Do you ever feel like quitting blogging?
– Andrew

Of course. There is no sustained activity that anyone does that isn’t occasionally tinged with a fair amount of regret. It doesn’t matter how much you love it – a long-term period of focused work will at some point make you wish you were doing something else.

How do I deal with it? I usually try to keep ahead with my writing so that if I ever feel like I want to step away, I take a short break (a few days or so) from the rigors of constantly writing articles. So far, after a few days away, the fire to write has come right back.

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

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