Reader Mailbag #55

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.
Should I Eliminate Financial Support For My Child After High School?
Lying to Yourself About Money (and Anything Else)
How Much Money Does Turning Off the Lights Really Save?

And now for some great reader questions!

The stimulus package might have some provisions in it for A) interest payments on auto loans, and B) sales tax on purchasing a new car. Will this affect your decision of when to buy a new vehicle if they make it through?
– Deborah

To a small extent, yes, but I don’t think it’ll have a big positive impact.

When such provisions go into effect, the car companies will pull back on some of their discounts immediately because these provisions will bring more customers onto the lot. In the end, you’ll likely end up paying a price that isn’t much different than you would have paid before the provisions went into effect.

We’re certainly aware of these provisions, but we’re not hanging our hat on them by any means.

How do you decide when to replace a washing machine?
– Lily

Here’s what we did recently when we had problems with our washing machine. We had a repairman come to our home to fix the washer. While he was working on it, I made some small talk with him. I asked him if the model we had typically has this problem or other problems. I asked a lot of questions about what he was fixing.

In a nutshell, I got him talking about what he knew, and he was pretty happy to share it.

Based on his comments, we decided to stick with the washer we have. He said multiple times that these washers were pretty sturdy until the motor goes, so we basically decided to stick with our washer until, well, the motor goes.

I am getting a $1500 bonus in mar 2009. my question to you is this what do you think about a wife not telling spouse about this cause if she does spouse will come up with a way to spend it. I am not telling him cause I want to save it for the future examp. car probs/ kids needs shoes/ mom needs to go grocery shopping. I know I should tell him but I have a secret stash that I keep and believe me I have saved my family when the crapper has hit the fan. what is your opinion on this. I am the saver/ spouse is and always will be the spender!!
– Eve

It seems like there’s quite a bit of mistrust going on in your marriage right now, and it needs to be resolved as soon as possible if you want to have a healthy long term marriage.

The first thing you need to approach is your spouse’s spending problems. Instead of attacking, I suggest simply talking to your partner about the goals and dreams you share. Work together to figure out what you both really want, then work from there to develop plans for reaching those goals. It’s a lot easier to turn around bad spending habits if you have something to work for.

You seem to want to save this windfall as an emergency fund. The honest thing to do is to simply tell your partner about the windfall and simply say that you’re going to hold onto it until an emergency occurs. Honesty is the foundation of a good marriage – no matter what you do, don’t hide the money.

What do you think of the vegetarian lifestyle? Is that something you would ever consider for yourself?
– Mary

My feeling on what people should eat is perhaps best expressed by Michael Pollan: “Eat food. Not too much. Mostly plants.” In other words, I believe strongly in making sure that you eat more fruits and vegetables than non-plants, but I don’t necessarily believe a meat-free diet is entirely necessary.

I tried vegetarianism for a thirty day trial a few years ago. It went well at first – I felt pretty energetic – but I fell off a cliff and felt exhausted after several days. The problem was that I simply wasn’t consuming enough calories. Thus, if you try vegetarianism, I would make sure to include a lot of higher-calorie vegetables and fruits in the mix, because most fruits and vegetables have a surprisingly low vegetable count. I would eat pounds of vegetables and only take in 200 calories or so.

Having said that, I have an old friend who has been a vegetarian for twenty five years. He says the key is to eat plenty of beans and rice – make them the backbone of every meal – and exercise quite a bit.

I have a process question more than a “what is the answer” question. The postage rate is going up in May. The PO sells “Forever Stamps” now which means we can lock in the current rate. What process would you use to decide how many books of forever stamps to buy before May? It’s certain money unless one loses the stamps (fire, flood, inattention, poor storage), but it’s today’s dollars vs. inflated dollars, etc. (We don’t have any debt, but I’d be curious how that would affect the decision as well). Thanks!
– Hillary

Here’s what I would do. First, I’d calculate the percentage change in the price of a first class stamp. Since it’s going to $0.44 from $0.42, that’s roughly a 5% increase.

Next, I’d check out the current rate of inflation, which is around 4% annually (depending on the metric you use).

Then, I’d simply divide the percent increase by the rate of inflation to get a thumbnail of how many years it will be before $0.42 in today’s money is worth $0.44 in tomorrow’s money: roughly 1.25 years.

Now, how many stamps do you use in a year? Let’s say you use 100 stamps. That means, in order to get the maximum value out of the forever stamps, you should buy 100 stamps per year times 1.25 years, or 125 stamps.

That’s the procedure I would follow, anyway.

You’ve posted a couple times in the past about starting up a serious exercise regimen. I was just wondering how that is going and also if you have any tips on staying motivated. Thanks!
– Lauren

Currently, I’m going to the gym for an hour’s worth of cardio three or four times a week (depending on my schedule). I get on the elliptical, get the heart rate monitor going, and try to keep my heart rate at 80% of my maximum. I usually sweat a ton during this, so I bring a water bottle with me and drink it down during the exercise.

I’m also going through the one hundred push ups program and the two hundred sit ups program to focus on two areas where I really need to build muscle.

It’s going well. I use daily metrics to keep myself focused. I simply have these three things on my to-do list every day, and I also weigh myself every single day. Making these things part of my daily routine was very hard at first – I just committed to doing them for thirty days and if I still hated it, I’d stop. I hated it for about the first three weeks, but after that, it started to become fun – I would feel great at the end of exercising.

I was surprised by your car advice, living in Iowa as you do. We live in Michigan and the salt eats cars alive up here. Every single old car I have had has died of rust long before the working parts have worn out. (We had one we drove until it literally dropped…fortunately DH was only going 20 mph.) Now I always look for young cars with higher (highway if possible) mileage. Our experience has been that the engines will last practically forever; not so the body.
– Kathryn

I’ve lived in the upper Midwest my entire life and I’ve never had problems with rust on vehicles that were less than twelve years old. Modern paint does a great job of protecting the car and a good undercoating helps, too.

However, the real key is to just keep it clean during the winter. Just rinse the salt dust off of your car every week or two during the winter, or take it through a car wash regularly. It keeps your vehicle looking clean and good and keeps the rust away.

Now, I own a 1997 Ford F-150 and a bit of rust is beginning to appear on it (finally), but it’s still far from being a rust bucket.

Hi Trent. I’m new to blogging, only got 2 or 3 posts going atm. How can I get my blog to appear on Google? Even when I type in all the keywords I can think of, I can’t find it!
– Vanessa

First, you need to actually submit your site to Google. If you don’t do that, Google doesn’t know that your site exists.

Beyond that, you also need to get people to link to your site. The best way to do that is to simply write interesting or useful stuff and link to relevant articles at other blogs. Link to a mix of places – popular blogs and unpopular blogs, new blogs and old blogs. Then, make an effort to get to know other bloggers on your topic. You can do this by seeking out blogs similar to yours and writing to the authors. You’ll have more success building relationships with bloggers with smaller audiences, especially at first.

My question for next weeks mailbag would be surrounding 403b’s. I am 24, live in a big expensive metro area and get to save very little money, but the nonprofit I work for offers a 403b and there is no employer match or anything like that. I put away 5% or so (I think) per month into that account but I was wondering if that money wouldn’t be better off in a Roth IRA or anything of that sort. Thanks for any input you can provide
– Will

If you’re not getting an employer match and you’re early in your career, you’re almost always better off putting your retirement money into a Roth IRA and not worrying about the 403(b) unless you want to save even more than the Roth IRA cap.

Here’s why: with the Roth IRA, you use after-tax money for your savings, but the money you withdraw at retirement isn’t taxed. Since you’re early in your career, you’re likely paying a much lower interest rate now than you would be in retirement, so there’s a big tax advantage in using a Roth IRA.

Another advantage Roth IRAs have is the freedom of choice. Since you’re setting it up yourself, you not only get a huge choice of investment options, you also have a lot of choice when it comes to deciding who to invest with. I use Vanguard, myself.

I’m using a mobile phone to access The Simple Dollar, but the page is really big. Any way I can see The Simple Dollar well on a smaller screen?
– Steve

I’m currently looking into setting up a mobile version of The Simple Dollar, but there are a lot of solutions for reading the site in a mobile format right now.

One great option is to use Google’s free mobile view. Here’s the mobile view of The Simple Dollar. It simply displays the last ten headlines – you can then click on them to read the article in a very bare-bones format.

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