What’s inside? Here are the questions answered in today’s reader mailbag, boiled down to five word summaries. Click on the number to jump straight down to the question.
1. Photos instead of heirlooms
2. Making your own clothes
3. Children financially contributing to gifts
4. Moving service or truck?
5. Trading in high mileage car
6. Group travel
7. Mortgage pay down time?
8. Buying a car but gullible?
9. Books on mindfulness
10. K cups worth it?
Yesterday, Sarah and I decided that our front door did not have adequate draft protection along the bottom, as we could both feel a bit of the bitter cold blowing in under the door.
Sarah’s solution was pretty sharp. She took some old cloth she had from a previous project, sewed it like a tube with a small opening at one end, and filled it with rice. She then sewed it shut and we placed it in front of the door as a draft blocker.
In the spring, if we really wanted to retrieve the rice, we could of course open up the blocker. Honestly, though, it’s doing a great job of keeping out the cold. Sarah did a great job of making something really useful out of items we happened to have on hand.
Q1: Photos instead of heirlooms
When our family was downsizing, we ran into the “everything has sentimental value” problem. We were scanning a Rubbermaid tub of old 1940s/1950s photos into the computer. My grandparents hung onto those photos for 50 years, so it felt like a travesty to throw them out, but we couldn’t identify the people in them. We finally figured out that if we wouldn’t spend the few minutes to scan and label a picture, it was OK to toss it.
My mom came up with the idea of taking photos of family heirlooms as well, rather than hanging onto the physical item.
It turned out this wasn’t just a great way to reduce clutter: it was also a perfect test of which items really mattered. Stuff seems important when you’ve had it for 20 years, but if it isn’t worth the couple of minutes to put it on a table in good light, photograph it, and categorize the photo on the computer — or if you find yourself thinking, “I’ll never look at this photo again” — then there’s definitely no reason to keep the item.
Plus, if you really want to show the kids something heavy and bulky, like Grandpa’s antique tools, making a photo book is more fun than digging out a heavy box (not to mention that everyone can have copies of the book instead of fighting over who gets the sentimental item).
It also keeps stuff from sitting around because you’re going to deal with it “someday.” I hung onto my wedding china for years after my divorce because I meant to sell it and get something out of it, but I finally realized I couldn’t face looking at it long enough to get it out of the box and photograph each piece for eBay. I sent the whole box to a charity and felt like it was a weight off my shoulders.
Of course we kept the stuff with REAL sentimental value, but most of those items are actually on display or in use in the house, rather than tucked away in storage.
I had mixed feelings about Joanie’s note at first, but the more I thought about it, the more I realized she had a good point.
What good is an heirloom if you keep it tucked away? If it’s not important enough to you to display in your home, why are you keeping it? It makes a great deal of sense to simply photograph it, keep the photograph, and move the item along to someone who will display or use it.
Yes, I understand sentimentality, but what is sentimental about putting something in a closet and never pulling it out?
I know several people who make their own clothes and I’ll say that, given two caveats, they do make some very nice clothes at a very cheap price.
However, these people are already passionate about sewing and making garments. This has been a hobby for them for many years and they just love it. Also, there are a lot of startup costs, such as a sewing machine, that would prevent someone from saving a lot of money right off the bat.
Your best bet, in my opinion, would be to find a local friend who already knows how to sew and has a sewing machine and ask that person to teach you the basics and walk you through making an item or two. If this sparks a passion in you, then go for it. If it doesn’t… then at least you didn’t sink the money into a sewing machine.
Q3: Children financially contributing to gifts
My husband and I have two children ages 7 and 10. We give them each an allowance of $5 per week. I think this is probably on the low side and have been thinking of raising it (to an amount that matches their ages) but haven’t done so yet. We allow them to spend their allowance money as they wish, even frivolously, so they can learn about spending mistakes now. When we go on a vacation or special trip we typically give them some extra souvenir money to spend for that occasion as well.
In the meantime my birthday is coming up. My husband and I typically don’t exchange gifts for our own birthdays and we encourage the kids to make a card or a drawing instead. However the kids’ grandma took them shopping to buy me a gift and wanted them to contribute part of their allowance money toward the gift. We vetoed this idea as unnecessary and too burdensome given how small their allowance is, which caused a temporary family rift. What is your opinion on this?
Unless Grandma checked with you guys before buying the gift, she stepped outside of what I would consider reasonable bounds. She doesn’t have any place saying what your children’s allowance should or shouldn’t be used for.
I generally think that young children should make gifts for their family because, as you said, their access to money is limited. However, that should be a family decision.
If Grandma wants to pay for the children to “buy” a gift for you, that’s her prerogative. It might not be the ideal situation, but it’s understandable. The issue I see here is the expectation of the use of a child’s allowance, which is out of bounds, in my opinion.
Q4: Moving service or truck?
Is the extra cost of a moving service a reasonable expense when moving? We are moving about 50 miles and are going to rent a moving truck, but when I sat down and ran the math on a moving service in our area I found that it would only cost about $100 more to just have someone move all of our stuff for us.
I’m guessing that you’ve already made up your mind here about the moving service or else you wouldn’t be asking the question.
It’s really a personal thing. Is the time and energy spent carrying the boxes and items out of your current home to the truck and from the truck to your new home worth $100 to you?
Also, I would make absolutely sure there aren’t any hidden costs with the moving service that you’re not accounting for here. Almost every one I’ve ever seen charges an hourly rate for their work, so I’d make absolutely sure that your estimate for how long it will take is accurate.
Q5: Trading in high mileage car
I own a 2013 Volvo SUV and am wondering if I should trade it in for a 2014. I average driving approx. 25,000.00 per year plus I live on an island and am concerned about rusting from the sea spray. I don’t know if the value of a 1 year old car with 25,000.00 miles would be better than the value of a 2 year old car with 50,000.00 miles, etc.
If I owned a new car, I would never trade it in before the new car warranty ran out at the bare minimum. It looks like that Volvo comes with a 5 year / 50,000 mile warranty, so I’d follow that.
If you’re in a situation where you expect salt spray to do significant damage to your car, buying a new car is a really, really expensive proposition. I would basically never buy a new car in that situation. I’d stick with used cars.
So, if I were in your shoes, I’d probably just drive this one until it shows significant problems, then move on to a late model used car of another type. The depreciation of a new car and the likely shortened lifespan of any car in this environment would keep me far away from new cars.
Q6: Group travel
We are planning on going on vacation with another family that has one young child, meaning there will be six of us. Neither of us have a car big enough to hold all of us and stuff for travel. Is it cheaper to rent a vehicle for the trip or to drive separately?
If you figure in vehicle depreciation on both of the cars you would drive, it’s likely that renting a car for the trip would be cheaper.
However, this depends on a few things. This would not be true for a short trip (less than several hundred miles). You should also make sure that flying wouldn’t also be cheaper, though for six of you, it probably is not.
Sarah and I are actually planning a trip with another couple this summer and we will likely be renting a vehicle for the trip, for just these reasons.
Q7: Mortgage pay down time?
I have been saving for several years. Currently, I am age 31, married with a one year old child.
I have no debt expect for a mortgage, which has a remaining balance of $76K. I took out a 30 year fixed, at 3.5% originally, August 2012 at $82,400. At these current values there is no tax benefit because we have a higher standard deduction than interest paid.
My savings are about $150k in retirement, $5k liquid (emergency), $7k investments, $13k HSA, $1k in 529 (opened as soon as we received her ssn). Both my husband and I have 250K life insurance policies and we have established a will, a revocable trust for our daughter if something should happen, medical directives and medical power of attorneys. My income is about $42k a year, but take home is $1130 per paycheck (2x a month), extreme job security. My husband is stay at home father, no income (and no day care expense), we have one car, fully paid for. We keep living costs low, without mortgage payments, we spend about $1000 a month on everything else.
Per month, I usually save $125 to 529, $350 to Roth 401k, $25 to citizens bank for college $1000 saver, $300 HSA, $100 investments, $30 Christmas shopping, and $200 extra to mortgage ($1130 per month). My job’s benefits include 10% of my salary gift to 401k not a match but a gift, and $2500 to HSA (leaving $4050 for remaining year). 2013 is the first year since 2003 that I have not contributed the full amount to Roth.
I am really thinking about extreme mortgage pay down, which if I stopped putting as much into the other buckets and also put my tax refund towards the mortgage, I can be mortgage free in 5 years. What I am thinking of doing would be reducing 401k, 529, and investment savings and putting that towards the mortgage. Once the mortgage is paid off we want to increase all of our savings to the max as best we can on; HSA, Roth IRAs, Roth 401k, 529, etc.
What suggestions/thoughts do you have? Would you suggest paying down mortgage over investing in Roth IRA? Would you suggest paying down mortgage over investing in 529?
Even if you contribute nothing additionally to your retirement, you’re still socking away 10% of your household income toward retirement, which is pretty healthy. This is particularly true considering your history of contributing quite a bit each month in addition to that 10%.
Given that, if I were you, I would feel just fine paying down that mortgage as rapidly as I wanted to.
As for the 529, that’s really up to you and your husband. You should be thinking about how much you guys actually want to contribute to your child’s education expenses, and there is no real right or wrong answer there.
Q8: Buying a car but gullible?
I’m about to start shopping around for a replacement car. However, I’m really nervous about doing this. I am very intimidated by salespeople and they often talk me into buying a car rather than me choosing the car. Any suggestions?
The generic suggestion would be to simply not take their line, but that’s not a realistic answer because, let’s be honest, a major personality shift isn’t in the cards for most people.
Instead, I’d suggest finding a friend who is willing to go along and be your advocate. If you have a close friend who is much more willing and able to say “no” to a salesperson, ask that person to go along with you when you shop.
Also, do as much prep work as you can before you ever go to the lot. Most car dealerships let you browse everything they have on their website. Also, talk to your friend that’s helping you about other possibilities, such as buying directly from an owner.
Q9: Books on mindfulness
In your post “The Failure of Just Thinking About Change” you mentioned that you have been reading a lot about meditation and mindfulness lately. That is a topic I have become very interested in recently. Do you have any recommendations as far as reading/resources?
I’ve read several books on mindfulness and meditation in the recent past. Two have really stood out to me.
The Miracle of Mindfulness by Thich Nhat Hanh is a relatively short book that focuses on the very basics of mindfulness. Hanh writes in a way that is so simple that it seems almost childlike, but if you think about the ideas and actually follow up on the practices, it’s pretty powerful stuff.
Search Inside Yourself by Jon Kabat-Zinn focuses heavily on being mindful and building useful mental habits in the modern world. The book has a humorous and light tone throughout.
I think Hanh’s book has stuck with me more, but both were enjoyable, thoughtful, and useful pushes toward greater mindfulness.
Q10: K cups worth it?
I received a very nice coffee maker that uses these K cups for Christmas. I tried the coffee that my sister’s pot makes and it was good enough for me. What I’m trying to figure out is whether it’s wort it to switch to the K cups from my normal coffee pot.
In general, I’d say that it is not, but it really depends on your habits as a coffee drinker. What are you using that home pot for? Do you just make one cup in the morning? Do you make several cups? Do you make a travel cup for yourself in the morning before you leave?
Generally, the less you make, the better a K cup machine will work for you. If you make only one cup a day, a K cup will probably do the trick. However, if you make a full pot each morning and you and others in your house drink multiple cups, the K cups will end up being really expensive by comparison.
Unless you are truly a “one cup a day” person, period (or even less than that), I’d probably stick with the pot you already have.
Got any questions? The best way to ask is to email me – trent at thesimpledollar dot com. Iíll 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.