Updated on 06.26.11

Reader Mailbag: The Band

Trent Hamm

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. Student loans and retirement
2. Being a frugality mentor
3. Food shortages
4. Selling unused items
5. International transitions
6. 2011 versus 1980
7. Annuity rollover?
8. Establishing a budget
9. Wedding registry ideas
10. College savings made easy

A close family member serves as the keyboardist for a great band that seems to be in the process of disintegrating. The lead singer and guitarist of this band has tons of talent and charisma, but just doesn’t quite have the desire to do something amazing with it.

I’ve got really mixed feelings about it. On the one hand, if you’re not happy doing something, don’t do it. On the other hand, if you’re giving up just because success didn’t happen just like you dreamed… don’t give up. Ask for help.

I’m talking right to this person, right now. He knows who he is. If you enjoy the music and want to do this, don’t give up on it. You’re too good at this to just give up on it if it’s something you want to do.

Q1: Student loans and retirement
I have a follow-up question regarding your post about paying into both student loan repayments and building up you emergency fund (https://www.thesimpledollar.com/2007/06/08/student-loans-and-the-philosophy-of-debt/). I’m in a similar boat, with about $40,000 worth of students loans with a 6.5% interest rate. I’m currently paying the minimum because my student loan company makes it difficult to pay more, but I’d like to pay more. I’d also like to build up my emergency fund (I almost have 3 months’ worth of living expenses saved, but I’d like 6). But I also wonder about my 401(k). I’m currently putting in 6% of my paycheck, which is being matched by my employer (who doesn’t match above 6%), but should my priority be to keep my 401(k) payments at 6% and pay off my student loan faster (after building up my emergency fund), or should I keep my loam payment low and increase my 401(k)?

– Alisa

It depends on how much you’re socking into retirement in total with your employer’s match.

If your employer is matching dollar for dollar up to 6%, that means you’re contributing a total of 12% to retirement, which is a healthy amount for someone freshly out of college. If that’s the case, I’d stay at 6% and get rid of those student loans.

If your employer is matching at a lower rate, that means that you’re probably only getting about 8% or 9% of your income into your retirement savings, which isn’t as good. In this case, I’d add more to your retirement contribution to make sure that you’re at least at 10%.

10% is a very good rule of thumb for people freshly out of school and already contributing to their retirement while also facing student loans.

Q2: Being a frugality mentor
We are unofficial mentors to a family that has 3 children (and a fourth older child who lives with his mother but they still pay child support). Our interest, frankly, is mostly with the 3 children as we have none of our own, and we are not going to be blessed that way. But we know the parents and interact with them as well.

The family is financially hurting, and there are emotional/psychological issues as well, tho not as extreme as some. (We do not need to get Child Protective Services involved at this point).

The problem that we see on the one hand is that they are very limited in income and in potential to make income. The other is that when they do get some sort of windfall (a tax return earlier this year) they make poor choices with that money that could have helped them down the road had they made better choices. They did some extra work this last month and are going to use it to vacation somewhere, when we live in a resort area with lots of vacation potential, and they are struggling to pay rent. I think they live with the idea that life is so hard day to day, when they get some sort of windfall they need to “reward” themselves for having it so hard.

Our desire is to show/model to the children that there are alternative ways to live. (We don’t shout at each other in our home, and we attempt to show consequences for actions rather than punishment for behavior.) I’m not sure that we are actually able to model these things well (i think the children see us as “rich” when we are simply mid level income and trying to make good choices). We do try to talk about “saving our money” for things in the future. We also are very aware that we cannot “rescue” the family or fix things for them, simply try to share choices that will make things different for them.

The problem, of course, is that the parents believe things are “easy” for us because we do have higher income and no children. Every suggestion made is countered with a “We can’t do that because . . . ” or “Yes, but . . . ” So i am aware that we are not able to help them much. People only change when they are motivated to do so.

Because this family’s life seems to be so similar to that of your childhood in some ways, i wonder if you could comment. Most of your site seems to be focused on folks who are making an adequate income to make changes in their lives. I’m interested what you would say to a family who is struggling so much to put food on the table that at times they have to decide whether to pay the electric bill or the gas. Also, they drive a big, old gas-guzzler. Their large vehicle uses as much gas in a 80 mile trip as our small Honda uses in 300. And it is unreliable as it has continued to break down. But with no money, i just don’t see how they can replace that vehicle to one that would be more reasonable for them. What would you say to a family in such a status? It seems to be such a deep money pit that it is impossible to know where to start.

What would you say to us trying to be a help but not “rescue” them? We have helped on occasion, mostly by choosing to pay for the activities of the children (baseball/tee ball for the boys, a dance class for the girl), and it was our choice, not their request. What would you say to a non-parent trying to mentor a child as far as money decisions? I don’t want these children to think of us as rich, but the reality is we do have a lot more freedom to do as we choose. How can we relay our choices to them? Do you think that is even possible?
– Kim

I think it’s difficult to do this because of the social “taboo” of talking about money. It’s a subject that many people do not feel comfortable talking about, particularly when you’re looking at situations where there are economic inequalities between families (as there seems to be here).

I think your best approach is to just drop little hints here and there. I’d do things like say, “You know why I like this car? It doesn’t use much gas, and gas is expensive, so I can use my money for other stuff. It gets me to where I want to go.”

Those little things have surprising impact on kids. For one, when you say things like that, kids often have a sense that you’re talking to them like an adult, which they tend to crave. For another, kids are often information sponges, pulling in little things from all over the place and synthesizing them. I see all three of my kids doing this all the time.

Don’t push it. Don’t overdo it. Just drop little hints.

Q3: Food shortages
I’ve been reading and hearing a lot lately about the coming food shortage and how we should be prepared. I believe this is tied to our disastrous economic situation in the US with a 14 trillion dollar debt. If somthing does happen to where we can’t get to the grocery store, or that trucks won’t deliver foodstuffs, or that farmers won’t be able to grow our food due to weather or govt. overspending, what would you do? What are your thoughts on this subject? Do you agree that we’re headed for a tough time soon? Do you think it’s all bunk? Or should we really be prepared for the worst?

– Julia

I don’t think there will be a true food shortage. The United States produces absurd amounts of food. However, there are challenges.

One challenge is logistics. The places where much of the food is produced is in a different place than where it’s consumed, and if you add in processing, that’s often in yet another place. There’s a cost in transporting those foods from place to place. It takes fuel, for one.

Another challenge is international trade. Free trade zones, resistance to such zones, high tariffs used as a bargaining chip in other negotiations, changing currency prices, and many other such factors all alter the cost of imported food.

What’s likely to happen isn’t a food shortage, but a change in the foods that are available at reasonable prices, likely followed in a few years by shifts in agriculture to handle the changes. I think if you expect to always have this specific food available at this specific price, you might be disappointed. Flexibility is always a good thing.

Q4: Selling unused items
I have started trying to sell some collectables, toys and books of my children’s and attempting to declutter our small home. However I am not finding it all that easy. I am using Craigslist and EBay, but many of our items are repeatedly going unsold and I don’t understand why. I see other similar items selling for sometimes more money than what I am asking. Am I just better off donating the items and taking a tax deduction? It is a bitter pill to swallow when you realize the things you have spent so much money on are virtually worthless.

– Cindy

Part of the difficulty you may be having is in your promotion of the sale. For one, you’re probably using an account that doesn’t have a long history of successful sales. The seller is certainly a factor in determining whether a buyer hits the bid button on eBay.

Another factor might be in how you’re describing the item. Use pictures. Make the description shine a little. This will entice bidders to bid. Shipping costs can also be a factor.

If you’re still having difficulty finding buyers, you may want to consider donating the remaining items or take them to a consignment shop.

Q5: International transitions
I’m 26 and live in the UK. I’ve completed three degrees. I have no debts, and I have £12k in an ISA earning less than 2% a year (though it tracks present interest rates, so it used to earn around 6.5% a year). I’m about to move to the US for my first job, a wonderful three-year position of my dreams, and will be making around $60-65k gross a year. At the end of three years, I am coming back to the UK to find a permanent job.

I’m very financially inexperienced at best, and this situation has me totally confused. As this is my first job I want to start off my independent financial life on the right foot, as it were. I have already good spending and saving habits. I know that I want to save as much as possible from this job, so that I’ll be in a position at the end of it to get a mortgage once I’m back in the UK. But how does one manage transatlantic finances? I have three questions.

1) My present UK savings: Should I be investing that £12k in something other than a 2% interest ISA while I’m away? I don’t need to access it. I’m highly risk averse and have never done any investing at all. From your writings I have the sense that I ought to put it into some kind of fund that tracks the stock index, but I have no idea how to do this. Or ought I just to leave it in the ISA, be content that it’s earning at least a bit above present interest rates in the UK?

2) My future US earnings: What would be the best way to save and grow my income from my US job? If I put money into a US pension fund (for which I would get no employer contributions) or into a Vanguard or Fidelity investment fund, how, if at all, would these earnings transfer to the UK? What taxes would I pay on them? Should I be trying to watch currency rates and transfer money into sterling when they seem propitious? Or ought I to leave the dollars I earn in the US and let them grow in US-based funds, thus maintaining separate UK and US accounts?

3) My credit: Having been a student most of my adult financial life thus far in the UK, even though I have large savings, I have basically no (or bad) credit history. I’ve never used a credit card, only a debit card, and never taken or had to pay back any loans. I know credit history doesn’t follow you to another country, so I’ll start fresh in the US and conscientiously build my credit there. But as my goal is to get a mortgage when I come back to the UK after 3 years, how can I ensure that my credit rating is good enough *in the UK* to get a good interest rate, when all my credit history will be US-based?

I’d be really so grateful for any wisdom you might have about this. I’m basically looking for a little help in putting together a transatlantic financial gameplan. I’m very sorry if you’ve answered a question like this before, and if you have, I’d be perfectly happy for you to point me to it rather than compose a whole new reply. Thank you so very much for your time.
– Rachel

For the first question, if you’re saving for a long-term goal (even a nebulous one) with a timeframe over ten years, you’re probably better off in a broad-based stock index fund, at least with some of your money. I’m not sure what sort of investments are available within the UK, but my understanding is that you can easily invest in investment houses in the US that offer index funds. I use Vanguard. You may want to think about a 50/50 split, where you leave half of your money in stable savings and put the other half into something more adventurous. This protects you against losses, but doesn’t allow you to ride the rocket ship of gains quite as much.

For the second question, my big concern would be taxes. I would discuss this with an accountant and find out how taxation would be handled with such investments. Another factor in this is your long term plans: where are you going to wind up over the long term?

For the final question, I would try to get a card in the UK before leaving, then attempt to use it occasionally while in the US (while keeping the balance paid off every month). Use it for sending gifts online for appropriate occasions or for when you return to the UK on trips.

Q6: 2011 versus 1980
I’m probably an “older” person as I remember the 1980’s and waiting on line for gasoline, and purchasing my first brand new car for $7800. at 18.9% financing. Yes, you read that right, I financed my first car at 18.9%. I worked at a bank and I remember mortgage rates being over 20% for a while during that time too. Credit cards were at 24%. How does the economy around now differ than it did around then, except for the high interest rates? Unemployment was in double digits then and people did not spend as much. I’m just trying to understand why people say the economy is so bad now, when not a lot of people remember the 1980’s and how bad it was then.

– Maureen

People have short memories. The economy was disastrous in the late 1970s and early 1980s. We had unemployment over 10% in 1982 and interest rates were as you describe. Virtually every significant economic indicator was as bad or worse then compared to now. We had negative GDP growth almost every quarter from 1978 to 1982.

Throw on top of that the 1930s… and 1907-1908… and even earlier periods, and you see that economic downturns do happen, and they can sometimes be quite lengthy.

Interest rates are low now because the Federal Reserve is handling the downturn differently than in the late 1970s and early 1980s. Bernanke is different than Volcker, plus one could say that they learned some lessons from the earlier downturn. My opinion is that they blunted the worst of it, but it probably created a slower recovery than before.

Obama is doing exactly what Reagan did in the early 1980s (late 1982 to 1984) to fix the economy: deficit spending plus lowered interest rates.

Patience is the key, but patience is a virtue very few people seem to have during a down economy.

Q7: Annuity rollover?
My husband changed jobs in March and recently received a letter stating that he earned money through a pension program – Single Life Annuity. Since the amount is less than $10,000, he is eligible to receive a lump sum immediately. We don’t want to pay penalties for early withdrawal. Are we able to move this money into a 401(k) or IRA, or would it be best to leave the money where it is?

– Kendra

You absolutely need to see an accountant if you want to try to roll that lump sum over into an IRA.

The rules involving such things are extremely nebulous and change constantly, so if I gave you specific advice on it, it’d be wrong next year (most likely). Not only that, your picture is a bit incomplete as it contains no information about your income (for one).

My guess is that you won’t be able to roll that money over into anything else, so you’ll have to choose between letting it sit or just taking the payout and paying taxes on it. That’s a personal choice you’ll have to make.

Q8: Establishing a budget
I’ve spent a lot of time trying to come up with a solid budget/savings plan….but I’m not really finding a lot of comparables. I dont know if I’m going overboard with trying to be aggresive in saving, or if I am not being aggresive enough. So, like everyone else, I figured I would air out my “facts” and see what your opinion was, and where you might suggest making some changes. Im 26 and have roughly $10,000 remaining in student loans (divided amoung 3 of them all at ~5%), and bring in about $4,200 a month (after tax/insurance/ and a 5% contribution to 401k). After that, Im maxing out my Roth IRA by contributing monthly, putting an additional $400 a month toward longer term savings, or an eventual down payment on a house, $350/month toward student loans, and another $700 tithed to my local church. My car is paid off, and I carry no credit card balance. Whatever doesnt get sucked up by regular monthly expenses at that point sits in my checking until I hit a certain value, and then I chop it down by throwing some into various investment accounts and savings. Am I on track with everything, or is there something I am missing? Any suggestions you have would be very helpful. I read several financial blogs like yours on a daily basis, and feel like I have tried to take a mix of advice from them, as well as some books I have read, to come up with my plan thus far.

– Jill

You’re doing just fine for the most part. You’re contributing a pretty significant chunk of your income to future savings beteween the longer term savings, your Roth IRA, your 401(k), and your use of your checking account excess.

My only concern is that you don’t seem to really have a plan with that money. The Roth and the 401(k) are understandable – they’re for retirement. However, you’re “putting an additional $400 a month toward longer term savings, or an eventual down payment on a house” and you’re also using your checking excess by “throwing some into various investment accounts and savings.”

This is good, but it’s not directed and it’s possibly costing you money. What is your goal? If you don’t know, ask yourself where you want to be in five years. Ten years? Identify what the big cost is in that picture and focus everything toward that. If it’s a down payment, direct all of that excess money into savings for that down payment. If it’s something else that’s longer term than ten years, put some of that money into other investments. The longer off your big goal is, the more of it should be in something with more risk and higher reward.

Figure out your goals and make your moves based on that.

Q9: Wedding registry ideas
My fiance and I are getting married this coming October. As such, we are going through the process of registering for wedding gifts. I have mixed feelings about people spending so much money on us but I figured we can use this opportunity to acquire some quality items. So far during the process, we have been trying to be smart about the things we decide to put on our registry. This means adding things have we’ll definitely use often, will last a long time, and will enhance frugality. It’s been difficult since we are being pretty selective. We both want to have less “stuff” laying around the house and I refuse to get any “uni-taskers”. Do you have any suggestions for items to put on the registry? Perhaps, there are some things you received that have stood up to the test of time.

– Eric

In my mind, it’s more a matter of what you do around the house.

If you cook, for example, you really only need three good knives (bread knife, chef’s knife, paring knife) and three pieces of enameled cast iron (two pots of different sizes and a saucepan) and perhaps a skillet to cook almost anything you’ll need. However, each of those items can be a bit pricy – you can get the bread knife and the paring knife relatively cheaply and a fairly inexpensive chef’s knife will work, but enameled cast iron will cost you.

It all follows from what you like to do. Focus on those things, research them in detail, and you’ll be in good shape.

Q10: College savings made easy
We have 2 daughters under the age of 3. They have just about every toy imaginable (thanks, grandparents!), and both have birthdays coming up. We are considering setting up some type of college savings for them. Do you know of any type of account that family members or friends can easily contribute to instead of adding to the Toys R Us in my living room? An easy-to-use website would be ideal.

– Dana

Many 529 college savings plans allow direct contributions from anyone. I would look into the 529 offerings in your own state to see what’s available.

Another option (if you don’t want to use the money strictly for school) is to open up a SmartyPig account and set up a savings goal for each child. Again, this allows anyone to contribute. It doesn’t have the education restrictions of a 529, but it might not have the same “pull” to convince people to donate that a 529 would have.

We’re more or less in the same boat as you. We have grandparents who love to give gifts and, at times, it feels like we have too many toys around. Part of the challenge is that we’ve not eliminated some of the toys our oldest child has outgrown because he has a younger sister followed by an even younger brother.

Got any questions? Email them to me or leave them in the comments and 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 hundreds of questions per week, so I may not necessarily be able to answer yours.

Loading Disqus Comments ...
Loading Facebook Comments ...
  1. Johanna says:

    Q5, Rachel: Are you coming to the US to work as a postdoc? If so, you might not be eligible to contribute to a US-based retirement account (not even an IRA), since your pay would be classified as a “fellowship” rather than “earned income” (although you still have to pay income taxes on it). You should check on this with the university/institution you’ll be working for (or whoever’s paying your salary, if you have an external fellowship) – they probably get this question all the time, since it’s equally applicable to US citizens as it is to you.

    I can’t help you much with your other questions, but I’ll offer a bit of unsolicited advice: Don’t focus *too* hard on saving as much money as possible, if it means giving up the chance to travel and see some of the US while you’re here. I was in the reverse of your situation a few years ago (US citizen doing a postdoc in the UK before returning to the US for a permanent job), and I sometimes wish I’d made more of the opportunity.

  2. Kim says:

    Great insight Johanna!

  3. Monica says:

    Re: Q9 Wedding Registry

    First off, congratulations on your engagement! I got married in January, and understand where you are coming from with the registry. My husband and I went out one evening for a few hours, then gave up and calling in reinforcements – my mother.

    It sounds funny, but it makes perfect sense. Who better to tell you what is practical and useful than someone who has been tending house for 30 years? (Could be a mom, friend, aunt, etc.)

    10 things we found really helpful with our registry:
    1.) Register for good-quality “transitional” dishes. If you register for both China and everyday plates, you’re likely to wind up with a half set of each. We registered for a Crate and Barrel set that is perfect for everyday use, but can be dressed up for company.
    2.) Register for at least 12 place settings and silverware settings. It seems like a lot now … but when you have kids a few years down the road, 12 settings is 3 meals of dishes.
    3.) If you are an avid cook – register for a Waring blender and a Kitchen Aid mixer. They’ll last forever.
    4.) If you are not an avid cook – register for a Kitchen Aid hand mixer. It takes up a lot less space than the stand mixer, and is a lot more heavy duty than it looks.
    5.) A nice quality set of pots and pans. Do your research. They will last for years if you take care of them.
    6.) A Dirt Devil Canister vacuum. We use this ALL the time. Cleans stairs, cars, baseboards, blinds, tile/linoleum floors, etc.
    7.) A regular vaccum, chosen based on your household needs
    8.) WaterPik shower head w/ the “hose” attachment, one for each bathroom. My family has used these for years. Great to wash the dog, if someone gets injured and needs to take a bath and for when kids come.
    9.) Garden and Grill tools make great registry gifts, if you have a need for/are into those hobbies
    10.) A pretty crystal ring holder. Yes, it sounds frivolous. But it’s practical, you will use it daily and it becomes an heirloom.

  4. valleycat1 says:

    Q9/Eric: Congratulations on your upcoming wedding! Try to put a variety of items price-wise on their registers, so people aren’t forced to spend more than they intended or go off-list!

    We cook our meals from scratch & rarely go out, and enjoy trying out new recipes. So, items we received years ago when we were married & still use today, in addition to the enameled iron pot Trent references: good quality stainless flatware, good quality dishes that go in dishwasher/microwave, a small assortment of good quality knives, a medium-sized heavy glass serving bowl we use for green and fruit salads (almost every day); miscellaneous cookie/baking sheets and large wire cooling racks; a rectangular enameled iron casserole dish, and square & round glass storage containers with plastic lids for leftovers; a good coffee pot and/or electric water pot. [We received & used a slow cooker, but it just died & we plan to replace it with a good enameled iron dutch oven instead.]

    Non-kitchen items: one or two sets of sheets (per bed), 4 towel sets (assuming the household is 2 people), a decent tool kit for basic home repairs, picnic basket w/supplies.

  5. Johanna says:

    Q6: “patience is a virtue very few people seem to have during a down economy.”

    Patience is a difficult virtue to have when you don’t have a job (or much hope of getting one anytime soon). Lecturing people that they should be glad that the unemployment rate is “only” 9%, when it’s been much higher than that at points in the past, is not particularly helpful to those who happen to be part of that 9%.

    What’s really outrageous is that anyone with any power to do anything about this problem seems to have washed their hands of it. “Unemployment? What unemployment? Let’s cut taxes some more so we can whine about how we can no longer afford a social safety net.”

  6. Johanna says:

    I hope that this great band is not actually called “The Band.” Because I think that names been taken for some time now.

    And Trent, couldn’t you have had a private conversation with this person beforehand so you could at least understand what his motivation is, before broadcasting your “mixed feelings” on your blog?

    You’re absolutely right, though, that if singing in a band is not something this person wants to do (or doesn’t want to do anymore), then he shouldn’t do it. It’s a bit complicated when you’re working with a team (or band) and have other people relying on you, but still: Even people with “tons of talent” do not owe it to *anyone* to do anything in particular with that talent if they don’t want to.

  7. Suz says:

    Q2: My husband grew up in a similar circumstance to what you describe. For his family, life is always a constant battle against “them.” It’s always other people’s fault why they go no further than their hometown. Just know that kids are more conscious of their situation and surroundings than you might realize. He knew since he was 5 that in order to not live the life of his family, he would have to go away to get what he wanted. By having good people around him, I think they were able to boost him up. He remembers and loves the people who helped him. So I think what you are doing for the children in showing them good frugality examples is great. But realizing you will never replace their parents in terms of influence and ranking in their lives is important (by that I mean, don’t bad-mouth their parents’ decision.)

    Q9: Congratulations on your engagement! I got married a year ago and probably registered for too much stuff. As other commenters have said, think about what kind of cook you are and go from there. I picked middle-of-the-road cookware because no one was going to spend $500 on me for pots & pans. I wish I hadn’t registered for the food processor as I have not used it once…I use the hand blender and mini chopper. I wish I had registered for more storage, like the OXO containers. And I really wish I had received more sheets sets…I can’t remember if I registered for many of them or not.

  8. Gretchen says:

    Americans WASTE absurd amounts of food.

  9. tentaculistic says:

    Q9 Wedding Registry – Eric, just keep in mind that you can put whatever you want on your registry, but even if every thing is chosen with great care, people will, if they don’t like your items, go off-registry. I found the registry process to be weird, uncomfortable, and ultimately largely futile.

    We’re grown adults (i.e. already had households) and we tend toward minimalism, so we tried to go without a registry (no gifts, just your presence if you can make it). My family/friends insisted strongly on buying us presents and so wanted a registry, so finally we registered for things we really wanted, whether they were expensive or not (some were, most weren’t). We would have been happy with no gifts — but paradoxically, because we were strongly pushed to set up a registry and then to populate it “X” way, I ended up getting annoyed when the people who pushed for the registry went with their own ideas anyway. Why make us do all that work then?!

    I had several family members insist I put “more expensive” things on my registry, so I put a Dyson vacuum on (all I could think of), and then no-one got it. Which still confuses me.

    One person bought something almost like what I put on the registry (same designer, same set, same color) but it wasn’t what I put on the registry — so they would have had to look at what I wanted, pulled up the related items, and then chosen something else instead. That’s when this stuff starts to get passive-aggressive. Really, no gift would have been fine!

    I also don’t understand why, if my items were too inexpensive, they didn’t just buy several until they got to the dollar amount they wanted to spend. So I didn’t get the inexpensive things we really wanted, and and we got random off-registry things that we didn’t want. As I said, it was a weird experience, and I’m still confused (and irritated) about it.

    I don’t understand why “no gifts” was unacceptable, when it would have avoided all kinds of unpleasantness, confusion, and lingering weird feelings. People make such a big deal about “Bridezillas” but if someone tries to do a low-key wedding, family tries to force the Bridezilla role on you. Very strange.

  10. Steven says:

    People all over the world aren’t starving because there’s a lack of food. They’re starving because there is a problem with distribution (and often political corruption.) This is why I’m concerned with Peak Oil. In the US, food is produced so far away from where it’s consumed (average food item here travels 2,000 miles to get to the dinner table.) If gas prices skyrocket due to Peak Oil, so too will food prices, especially for the foods that have to travel long distances. I believe this will translate into a distribution problem, and people will have a hard time getting affordable foods. Large cities like LA have only a few days worth of food on their shelves. What happens to these places where they aren’t able to grow enough food to feed a huge population? It’s easier in the Midwest where access to large plots of land is possible, but more difficult in areas where there are no open spaces. It worries me.

    Unfortunately our elected officials opt not to do anything about our dependence on oil (foreign or domestic) and it’s been stated that we reached Peak in 2006. Production has currently plataued, and I expect to see a decline soon (within the next 5 to 10 years.) If we don’t start preparing now, we’re going to experience major problems, and if you think the recession of the past few years has been tough…I’ve got news for you. It’s going to be a whole lot worse.



    I don’t understand how you could possibly compare Reagan’s “unleash the private sector” to Obama’s “keep his boot on the neck of producers”. They are not doing the same thing. In fact they are enacting exactly opposite policies. It makes sense that while Reagan’s policies initiated a historic peace time boom in the American economy, Obama’s policies have continued and deepened a recession.

  12. Sonja says:

    Q2/Frugality Mentor: You mention that your interest in these children has some root in the fact you do not/will not have any of your own. I think it is noble to help out but since you are *not* related to this family, please tread lightly. I think your footing the bill for the sports and dance lessons is a generous thing to do. But realize that the parents may now expect you to do it. Or they may end up resenting it. You have made it easier for them to come to you for financial help and it may be hard to say “no” if they ask you to pay their electric bill. By all means spend time with the children and help them learn to set goals and work toward them instead of just wishing for or dreaming about an outcome. That will be the best lesson you can give them.



    Following my criticism, I must commend Trent for his honest answer in Q7. “I don’t know” is an acceptable answer when it is the truth. It is much better than giving incorrect advice as factual.

  14. Sonja says:

    Q9 – Wedding Registry. We have been married 28 years and no longer have many of our wedding gifts. However, we do still have all of the tools we were given. We became avid Do-It-Yourself-ers motivated by not wanting to pay others to do what we could do. I know we still have the drill bits, screwdriver set, torque wrench set, carpenter’s level, stud finder, hammer, mallet, etc. we received as gifts and have used them all. We also received some yard/garden tools that we have had to replace over the years. Starting out, these were all great practical gifts. I did not mind getting “manly” gifts, because to me these were items that we would not have to purchase on our own. You can register someplace like Amazon.com or Sears that sells everything.

  15. Jenzer says:

    Q4: When I began selling on eBay, I read two tips that have helped me sell a few items that were slow to move. Tip #1: a low starting bid (i.e. well below an item’s typical resale price) can net you more bids overall, as folks will bid in hopes of snagging a bargain if they win the auction. Tip #2: once someone places an initial bid, they sometimes develop a sense of “ownership” of the item, even if they haven’t actually won the auction yet. This leads them to place successively higher bids if another member outbids them before auction’s end.

    An example … my FIL had me list several collectible Royal Doulton figurines on eBay for him. Based on completed auctions, I expected one particular figurine to sell in the $120 – $150 range, so I listed it initially with a starting bid of $100. That auction closed with zero bids. Then I relisted the same figurine with a starting bid of $20. It ended up selling the second time for $135. I believe the lower starting bid was responsible for gaining more attention for that auction item, and the psychology of “bidding = ownership” worked in our favor to drive up the final selling price.

  16. Johanna says:

    Q2, Kim: I urge you to think twice about how much you really know about what life is like for this family. You deride the parents for saying that it’s easier for you to make good money decisions because you have more money, but they do have a point.

    I’m not familiar with all the research that’s been done on this topic, but there have been psychological studies that show that self-control is like a muscle that can become fatigued: The more you use it (the more you *have* to use it), the weaker it gets. You look at their decision to use their windfall money to go on vacation and say “That’s a bad decision,” but when they’ve been saying “no” to things they want all year long, it becomes a lot harder to say “no” to that vacation.

    I agree with Suz that you should be very careful to avoid bad-mouthing the parents’ decisions in front of the kids. And that, I think, rules out a lot of the “little hints” that Trent suggests. To say “I like this car because it doesn’t use much gas, and then I can spend my money on other things” is to say “If someone drives a gas-guzzling car and then doesn’t have money for other things, it’s their own fault.” And since you realize that the parents don’t actually have the choice to get a different car right now, I don’t think that’s something you want to say.

    What I’d suggest is, hold off on the money lessons until the kids have money of their own and have to start deciding how to spend it. If they get part-time jobs as teenagers (and if they don’t have to contribute all their earnings to help with household expenses), talk to them about what they’re doing with the money. When they move out on their own, you could give them a book (I like “All Your Worth”) that talks about money management in a compassionate non-preachy way.

  17. Kathy F says:

    Regarding selling on Ebay, be sure and research what people are willing to pay for the item and how many other people are selling them. Use the “Advanced Search” feature to look for specific items for the auctions that have closed. Then you can see what sells and what does not and at what price.

    Jenzer is right about pricing. Use the auction format to set the price below what you think the final sale price will be and let people bid it up. Bidders like to hope they can get it at a lower price rather than bid on the auction where the price already starts higher.

    Look at other people’s auctions to get good ideas on how to list them or not to list them. Use the Ebay Community discussion forums to ask others to check out and critique your auctions. The discussion boards are great sources of practical information.

    Use more than one photo and gives lots of description in your auction. You can add extra photos to your auction by providing links in your description to photos posted on Photobucket, where you can host the photos for free. This way you can avoid the extra fee Ebay charges for using more than one photo.

    I only use Craig’s list for heavy or bulkier items that are hard to ship and breakables. Do a search for your type of item and find out what the competition is. Remember people come to Craig’s list for bargains. They may want to haggle with you some so be prepared for that. Be prepared for no shows, too.

  18. Katie says:

    @ #9 – Where the people harassing you to set up the registry the same people who got you off-registry things? If not, I’m not sure there’s any particular inconsistency to get annoyed about. Even if so, I don’t think it’s that weird that someone wouldn’t buy on-registry. Maybe they didn’t want to buy a bunch of inexpensive things and lump them together because they wanted to give something that felt like a thoughtful and cohesive gift, not a grab bag. Maybe they bought another style because the original one was sold out. Automatically assuming “passive aggressive behavior” because you got a gift that you don’t love seems like a pretty negative way of looking at something that was, in essence, people giving you free stuff, without other evidence.

  19. valleycat1 says:

    Q2 – I agree with the others that you need to tread lightly. Buying the kids stuff or experiences that their parents can’t afford isn’t going to help them in the long run – just reinforce the message that they can’t afford a lot that you can.

    Children learn a lot from example, so perhaps you can take them on free or low cost outings, sign them up for library cards, take them along when you grocery shop (or whatever) to just be exposed to how you approach budgeting (no lectures or indirect comments),etc. If they ask questions or initiate a conversation about finances, by all means be willing to talk about the specific question without putting down their parents, their situation, or others in the same boat.

  20. Tom says:

    I don’t think the amount the employer matches (whether its dollar for dollar or $0.50 on the dollar) is sound basis for answering question 1.

    Let’s put it this way: Alisa has managed to save up an emergency fund and get the maximum employer match on her 401k. 6.5% insterest isn’t obnoxiously high, but it’s not low interest debt either. I look to the current rates of 30 year mortgages as my indicator of what’s low interest. Her loans are 2 points higher than the average 30 year mortgage. My student loans are at 3%, but that’s becuase I graduated in ’07 rather than 2008-2010 (The last 3 years has actually been rather unfortunate for people who took out federal loans that were fixed rather than based on the 91 day treasury).

    My suggestion would be to keep the 401k contributions where they are, and funnel some of your monthly e-fund savings towards the loans. Remember, they’re near impossible to discharge or “refinance,” unlike most other debt you can acquire. There’s also the idea that you’re getting a “guaranteed 6.5% return” on paying them off early, something you won’t find anywhere else.

  21. Kristine says:


    If a child’s home life is awful, the tee-ball or the dance lesson may be the only oasis they have in a miserable existence, and a validation that they matter. If it is a b-day gift or something, I see no problem with it.

    The only thing I would be careful of in giving gifts to very low income people is that if you give them a giftcard for any store, knowing they want to get a specific item from that store, make sure it is enough to get the item, or just get the item, or get something else. (you cannot cash in gift cards)

    When I was very poor, an in-law relative gave me a gift certificate to 9-West for boots- mine were falling apart. I normally could only afford 5-10 bucks max, and bought at goodwill. Excited, I went to 9-West, and found that I was about 30-50 bucks shy of what was on clearance. I felt awful. I could not afford to spend 30, and anything else there was a frivolity I did not need, and that would make my clothes look even shabbier by comparison. It made me feel so damned poor I fell apart in the mall and cried. My husband decided that he could do without a Christmas present that year, and got me the boots. But the whole thing made me feel just awful and wince every tjme I put them on. I was glad when they finally wore out.

  22. AnnJo says:

    Q2 – Sound financial decisions are just a subset of strategic decision-making.

    Children will learn strategic thinking far better from games than from “modeling” or lectures. Play games with them that require planning, if-then assessments, coping with surprises, etc., like Monopoly, chess, pinochle, canasta, Risk, and I’m sure there are many newer and higher-tech versions. Enlist the children’s help in planning some extended activity like a garden, a building project, a craft project or some event like a surprise anniversary party for their parents – anything that requires deferred gratification, planning, investment for future return.

    The skills they learn through those kinds of activities will be available to them when they begin their own financial lives. Just as importantly, many children crave the attention of a caring adult, and if their parents are stressed by work and financial concerns, they may have limited time or energy to give.

    All that being said, in our culture there’s a point beyond which unrelated adults involving themselves in the lives of other people’s children can start to seem a little creepy. Be careful not to cross that line.

  23. Genny says:

    RE: Q2-Just my two cents worth…I suggest buying books for the kids on topics they are interested in, and skipping any hints, financial or otherwise. Library cards are great but unless the kids are within walking or biking distance to the library, they might not be able to utilize them (given the whole car situation.

    Also, just being with the kids and affirming that they can have a great future, that they can succeed in school and in life might be just what they need.

  24. jackie says:

    Please remember that everything you own doesn’t evaporate when you get married. You don’t need to register for things like towels. The question asker seems to know that, but all these comments are strange. Presumably everyone already has towels, and even new high quality ones are not going to last forever. Use the towels you have an get new ones in 10 years when yours wear out. Same goes for dishes, vacuum cleaners, sheets.

  25. Courtney20 says:

    Jackie – Maybe I’m old-fashioned (at 29) but while I see your point that people usually have some stuff, sometimes it’s not much. My husband and I got married right out of college. We each had two towels and a couple random dishes/cups for late night dorm room snacks. Sheets for twin beds. No vacuum cleaner, no bathroom accoutrements (shower curtains, bath mats, etc), no appliances, no cookware. Our registry and our generous families were a godsend.

  26. Genny says:

    Re: Response 24-I think most posters are assuming (as I am) that the man who wrote the post is just starting out. I know that when I got married (many years ago:) although I did have household items, they were all (well worn)hand me downs from relatives. My shower and wedding gifts were my first NEW household items. However, your point is valid if the poster has already established his household.

  27. AnnJo says:

    Kendra at Q7. My guess is the opposite of Trent’s; you probably CAN roll-over your annuity into an IRA, but before you spend the $$ on an accountant, check with your company’s plan administrator. They usually offer brochures or info on their websites that provide explicit instructions for how distributions can be made without triggering taxes.

  28. Jon says:

    I don’t see the situation in question 2 ending well. The parents are going to become resentful if you continue to pay for their kids activities. Or they will see an chance for handouts. What will you do when the parents are asking you for money?

  29. jim says:

    “We had negative GDP growth almost every quarter from 1978 to 1982.”

    That is not really true.

    From ’78 to ’82 the real GDP (inflation adjusted) was positive 14 out of 20 quarters. Thats positive growth 70% of the time. Its not accurate to say it was negative “almost every quarter” if it was only negative 30% of the time in that period. ’78-’79 were both positive years without a single negative quarter. The data is at the BEA website or searching google for “gdp growth history”.

    I agree things were pretty bad in the early 80’s, but they were not that bad. Negative growth for most of 5 years would have been a depression.

    For someone who claims to be apolitical, comparing Obama to Reagan is almost trolling.

  30. Telephus44 says:

    Q6 – Thanks for reminding us. I always think of the 80’s when someone whines that a 6% rate on a mortgage or 7% on a student loan is way too high – I just want to laugh in their faces. When you’re at historical lows, it’s really hard for me to take that kind of whining seriously.

  31. Baley says:

    In response to Katie’s response to #9’s answer: Those “free” gifts are not really free: they cost the recipient time in writing a thank you card, time to return the item, and time in setting up the registry that does not get used! They also take up space in the home and cause emotional distress on the recipient (i.e. how do you thank someone genuinely for something you didn’t want? How can you return the item without offending the giver? etc.) A bad gift is worse than no gift at all from a practical standpoint. I sympathize with the author of response #9. It sounds like from her answer that it was the same family members who asked for a registry and then bought items off-registry. I recently had a baby and registered at three places, both online and in-store, and still ended up with a bunch of things I didn’t want/couldn’t use and things I had to return to the store. And no, an unwanted gift is not as good as a gift card. It is usually more hassle to return than just to use a gift card. I also ended up with multiples of the same item somehow; it must be that some people just don’t know how to use a registry.

    However, there’s really no solution to it. Couples just have to keep making wedding and baby registries hoping to get some things they want/need and gift-givers will continue to give well-intentioned but undesired gifts. I specifically told people in my invitations and elsewhere that we were going to be cloth diapering our baby, but people still insisted on giving us disposable diapers as gifts. We wanted to cloth diaper in order to not cause waste, but instead we have packages of diapers that we will have to pass on to someone else or try to take back (but to which store? we have no receipt for them). It’s a waste for people to buy gifts for others that they aren’t going to use.

  32. valleycat1 says:

    #24 Jackie – In my comment #4, I was answering the question from the perspective of what we got for wedding gifts that proved to be of continued use & not stuff we could have lived without. I didn’t intend my comment to be ‘here’s what you should register for.’ In fact, all we had registered for was a set of dishes & the stainless flatware, which was all we really wanted as we combined households. The other gifts were pleasant surprises we found useful – particularly the glass salad bowl.

  33. Katie says:

    I’m not saying it’s ideal to buy gifts people aren’t going to use. But from a giftee’s perspective, I do think it’s important to recognize that they were almost certainly given in good faith because the giver truly thought it would be valuable to you. It shouldn’t be a cause for emotional distress – the thank you note is easy: “Thank you so much for thinking of us; we so appreciate your good wishes.” And the time spent writing that note is about nurturing that relationship, not some quid pro quo for the gift. It’s not a financial transaction and shouldn’t be treated as such. Nor should couples think of registries as shopping lists – if getting a very specific item is that important to you, you should buy it yourself. Gifts, by their nature, are discretionary.

    None of this means that givers shouldn’t make a concerted effort to get people gifts that are appreciated, however. Of course, when you’re shopping for someone, you should take into account what will be useful for them and what is needed. I don’t think that means you should feel obligated to limit yourself to the registry, though.

  34. JS says:

    Q4: Maybe I’m just lazy or not sales-inclined, but to me, trying to sell inexpensive and/or common items on EBay and Craigslist is just more trouble than it’s worth. You have to post the items, keep track of them, store the items while you wait for them to sell (which slows down decluttering), deal with the potential buyer(s), ship them and make sure you get paid your small amount of money. I’d rather just donate the item, take it to a consignment store or used bookstore for credit or give it away, and use the time I would have spent on more enjoyable frugal pursuits. The only things I’ve ever felt were worth it to sell online were textbooks; everything else I’ve ever wanted to get rid of was either worn out, obsolete or worth almost nothing on the resale market.

    Q9: Congrats! If you like to bake, silicone bake ware is fantastic. Also, almost any large chain will let you set up a registry, so consider non-house wares items that you would get value from. Two friends of mine were moving to Arizona to South Dakota right after their November wedding, so they registered at REI for winter clothes and gear.

  35. karishma says:

    Q9 (&#24): I actually feel I ought to have registered for more towels! The ones we had before we were married were hand me downs from my in-laws, and were pretty well worn.

    We registered for decent but not terribly expensive ones (that I still love), but we were living in a small apartment at the time, and it simply didn’t occur to me that we might one day move somewhere with more than 2 bathrooms. So, when we moved to our house, I had to go out and get completely different hand towels for our powder room – not a huge deal, but more annoying than just having enough for all the bathrooms to begin with.

    So think about future plans when you are registering, and if they’re only a year or two off, perhaps include those items in your registry.

  36. AnnJo says:

    On Q3 re: food shortages.

    I agree with Trent’s assessment as the most likely scenario, but I wish he would take the opportunity this question presents to suggest that preparing for a PERSONAL food shortage is never a bad idea.

    Whether from storms, tornadoes, hurricanes, earthquakes, floods, power outages, or whatever, a local or regional disruption of food supplies is always possible, and every person who prepares ahead of time is one less person emergency services have to worry about.

    It’s also the frugal approach. A case of bottled water bought on sale at $2.50 can cost $100 or $500 to bring in by helicopter after an emergency. Some canned and dried foods purchased on sale and in bulk are a lot cheaper (and healthier) than flown-in MREs.

    Building some resiliency into our own lives and our communities is given far too little attention. Since it’s also completely in aligment with frugality and long-term planning, I wish Trent would use his soap-box to urge it, when given the opportunity.

  37. tentaculistic says:

    @#18 Katie – Yeah, I knew when I wrote about the registry that I was going to end up sounding like I was whining about getting gifts, which is both ungrateful AND ungracious.

    But… That’s not my point at all. My point is that we didn’t want gifts, but I was bullied into asking for specific gifts I wanted, then bullied into asking for specific (more expensive) gifts I didn’t want, and then those very same people who made me do a registry did not even get me ANY of the gifts they had made me list. Wtf?! You have to admit that that is a strange dynamic.

    I would like to think that for the almost-but-not item that they were sold out of that item – that would actually make me feel less “icky” about it – but it was a nationwide store, and I was able to get the same item 2 years later (I really did want it!), and I just checked now (7 years after the wedding) and it’s still available.

    I guess my point is that if they had let me leave it as “no gifts please, you presence is more than enough”, then people would have been welcome to do just that – no gifts – or to get us any gift they thought appropriate. And we would have been greatly appreciative. Demanding a registry and then going off-registry is a slap in the face (do you consider my taste to be so bad?!), and just weird.

    That said, of course I wrote extremely gracious thank-you notes, and thanked them in person, and would never in a million years say anything to any of them. But it still makes me go “hmm” and wrinkle my brow when I think about it.

  38. AndreaS says:

    #2. I am retirement age, and of the attempts I have made to help people, most ended poorly. Frugality is not rocket science… most strategies are obvious. Mostly success is about delayed gratification… the ability to do something less pleasant now for a long term gain. This is less a learned behavior and more a personality trait. Even when people are presented with information on how to do things better, they often will not use that information. I always know it’s time to bail when I find myself working harder for people than they work for themselves.
    My rule in helping people (including my adult kids) is to not help with money. This is because they usually have money but are not using what they have well enough. I do help with my time… garden surplus, babysitting, mending and repairing, loaning tools and so on. My husband and I are also quite skilled in finding good deals on used items.
    The main hurdle you will likely have with this couple is that they may reject frugal ideas because they mistakenly believe frugality is what poor people do, and so they will want to avoid many strategies because of this stigma. You mentioned your income difference. In this case I would tactfully demonstrate what strategies you use to save money. Using resources wisely is how you improve your standard of living. It’s how you acquire skills and material goods. So if you want to convince them that secondhand clothes is a great option, then make it obvious to them that you (middle class folks) proudly wear secondhand clothes too. The best thing you can do for them is find a way to demonstrate that you reuse leftovers, find great deals at yard sales, and even pick up stuff off the curb. It will remove much of the negativity they may feel about doing frugal behaviors. Without directly preaching show them how they can do things with little or no money BETTER than options that cost a lot. Frugal strategies are not always enough to get people out of their financial hole, but it goes a long way to making life more doable and pleasant. Children should never be at a lack for material goods (toys, books, clothes) because of the volume high quality of goods for kids at yard sales. It is important to pick up clothing during the summer for clothes that kids will need for the next 12 months.

  39. Kirk says:

    I have a concern with you saying Obama is doing EXACTLY what Reagan did. Might be true on spending and interest rates. Not true in many other economically important areas such as regulation, especially as it pertains to small business. Reagan did not place a great unknown of the cost of health care on small business. Businesses are still doing exactly the logical thing right now when the costs of future taxes, regulation, etc… are such an unknown. They are holding tight to their cash and playing their cards close to their chest.

  40. Aaron says:

    For all the people who are slamming Trent about saying Obama is doing the exact same thing Reagan did, Trent’s point is directed at alleged deficit hawks who slam Obama for deficit spending, thereby enlarging the national debt. The point is that in the light of higher vs lower interest rates and deficit spending vs austerity measures, both Obama and Reagan have made the same macroeconomic decisions.

    This is at a very basic level, and Trent is absolutely correct. If pointing this out is trolling, then so is pointing out any other truth that runs counter to anyone’s political ideology. He’s not endorsing Obama in any shape or form, nor Reagan for that matter. He’s simply pointing this basic fact out, which seems lost on most people who are suddenly concerned about deficits.

    I had a conversation with a very conservative co-worker recently about how the Great Depression was ended. FYI, I’m a moderate, not liberal, nor conservative. My co-worker said deficit spending did not help end the Great Depression; the New Deal was a failure. I made the argument that part of the reason the New Deal failed to end the Depression was Roosevelt didn’t deficit spend enough. His response was, “THAT IS SUCH A LIBERAL THING TO SAY!”

    So I asked him what ended the Great Depression. He said WWII. So I asked why, and he said it was because of all the increased factory output for wartime goods and services which produced jobs. I asked him if the US gov’t had the money to pay for all this up front. He said no. I pointed out that WWII represented up to that point the most massive, record setting, historical bout of deficit spending in US history, obliterating the costs of the New Deal. Ah, but it was for defense, so that was okay, he said.

    IT’S STILL DEFICIT SPENDING! And deficit spending is not liberal nor conservative. The last two presidents have massive deficit spent, and each stands on different sides of the political spectrum.

    Sorry, just tired of partisan bickering to the point that no one can accept what is basic undeniable obvious fact. If you’re conservative, and you really really like Reagan, you still have to accept that Reagan ran up the national debt A LOT. Reagan being regarded as an economic conservative doesn’t change history.

    And people need to stop being politically hypersensitive. RANDOM ANONYMOUS as a case in point. How is Obama’s choice of low interest rates and deficits the exact opposite of Reagan? They’re not. Riddle me this – how is Obama’s policies in regards to economic stimulus and TARP different than George W. Bush’s, who initiated the first rounds of them? They’re not different at all in any significant manner.

    Sorry for being so long winded, but it really irks me when partisan hackery drowns out even basic factual statements.

  41. deRuiter says:

    One reason for sky high food prices is bio diesel. It takes the equivalent of a gallon’s worth of resources to make a gallon of bio diesel. All those farmers making money on corn subsidies for bio diesel are taking the corn out of the food production stream and wasting it. I know you all hate oil, but oil is a cheap, reliable, easily available fuel which doesn’t take corn out of the mouths of the hungry. Bio diesel doesn’t save any resources, the bio diesel subsidies are what keep a lot of members of Congress in corn farming states re elected. Stop all bio diesel subsidies, and corn will again be available for food, prices will go down. Wind is nice, solar is nice, but if they only are viable with subsidies, then oil is a better choice for now. If we pump more American oil, the American economy will rebound with those well paying oil jobs, and the business ripple when those iol producers spend. By pumping American oil we will stop sending money to the Middle East which is populated by those who hate America and wish to kill us all. Local oil improves America’s balance of trade. Americans are more careful with drilling than any nation in the Middle East, so american oil is better for the world’s environment. Bio diesel is also not as clean burning a fuel as oil, so it damages many small engines which then have to be tossed and replaced, certainly not an environmentally positive reslut from a stupid, so called “green” policy.

  42. Jonathan says:

    “By pumping American oil we will stop sending money to the Middle East which is populated by those who hate America and wish to kill us all”

    I’d like to make two points. First, increased US oil production is not going to mean we suddenly stop buying oil from the Middle East. Since oil is traded on the world market we would be doing nothing more than adding our additional supply into the supply coming from every other nation (Libya, Iraq, UAE, Iran, Saudi Arabia, Venezuela, etc).If the US government decided that we could produce enough oil to be self-sufficient and remove US production and consumption from the world market we would see a major impact to both our national and world-wide economy.

    Second, the Middle East is not populated by those who hate and wish to kill us. Yes, there are some in that area who do wish to do us harm, but they are the minority. There are people everywhere who hate us. There are even people within our own borders who hate America. This includes both domestic terrorists as well as anti-government individuals and groups. There is plenty of hate in this world, and Americans do just as much of it (both aimed inward and at other nations) as the countries in the Middle East and elsewhere.

  43. moom says:

    I worked in the US and have accounts in the US and Australia where I live now. These include both US and Australian retirement accounts. This certainly makes things more complicated. The UK might not recognize the tax status of the US accounts and try to tax the unrealised gains in the accounts (Australia recognizes the status of my 403b but not my Roth IRA). On the other hand you won’t be able to withdraw money from a US 403b or 401k without paying tax and a 10% penalty before you are 59.5 years old. So if you aren’t getting an employer contribution it might not make much sense to have a US retirement account. You’ll have to decide if the reduced income tax for making contributions to a 403b/401k is worth locking your money up in the US for 35 years…

    You’ll need a US bank account and could look at some kind of saving account though interest rates are very low now. Trent’s suggestion on the UK credit card is good but remember that if you use it in the US you’ll likely pay extra fees for using it abroad. Also, you have to work out how to pay off the card. In other words, you need money in the UK or get it there to pay off the card each month.


    When comparing interest rates (set by the FED), you are correct that coincidentally, they are the same. You are correct.
    When comparing austerity measures, perhaps the effects are similar. Reagan unsuccessfully fought against a free spending House of Representative while Obama encouraged a free spending House. In the end, the effect was similar.
    Their treatment of citizens through the regulatory agencies were different. However, I am sure that government regulations have no effect on economic activity.
    One comparison you missed, I think Trent was also comparing male vs. female. Again, Obama and Reagan are exactly the same.

  45. Snowy Heron says:

    Another difference between Obama and Reagan is on taxes. Reagan cut tax rates and Obama is just trying to raise them. Of course, it is only on the rich. Some days, the income that my husband and I report in our tax return would qualify as “rich” and some days, based on the president’s comments, it doesn’t. Of course, when the income tax was first started, it only applied to the rich. Funny how things change. Or not!

  46. Aaron says:

    @Anonymous Poster,
    Reagan fought against a free spending Congress?! Patently false. He fought against spending on some social programs, but when it came to spending on the things he cared about like defense, he spent freely with money the US gov’t did not have, even on wasteful defense spending on things like SDI. Reagan had no problems with deficit spending; he had problems spending on social programs. Again, political ideology should not cloud basic historical fact.

  47. Miguel says:

    “Reagan cut tax rates and Obama is just trying to raise them”

    Reagan raised taxes in 6 of his 8 years in the White House.
    Federal taxes right now are the lowest since 1948, roughly averaging 15% of GDP (less than half of the OECD’s average).

  48. tarynkay says:

    On registeries: a major law of ettiquette- gifts are always optional. No one has any obligation to buy you a gift. Think about it- if you’re disappointed by a gift, it’s because you thought for some reason that you were entitled to it. Why? If someone wants to buy you a specific gift, that is very kind of them. Be grateful, say thank you, write a nice note. If you do not want to keep it, pass it on to someone who does want or need it. If you get disposable diapers at your baby shower, and you’re planning to use cloth diapers, take those disposable diapers down to the women’s shelter, or social services. Someone will be thrilled to get them.

    Registeries make no sense to me because they take all of the fun out of gift-giving. So I completely ignore them. If I buy off a registery, I’m not picking something out for you, I’m just following your shopping list. So if I don’t know a person well enough to put time and effort in their gift, I just give cash. If I do know you well, I will give you a gift that reflects that.

    I especially hate baby registeries. Somewhere along the lines, baby showers became huge events with registeries several pages long. I read an anthropology journal article once about how in consumer-based societies, expectant mothers create the personas of their unborn children through extensive research about and eventual purchase of consumer goods. This is why expectant mothers get so upset when people go “off registery” or buy the “wrong” bouncy seat or when grandma crochets a baby blanket that does not match the nursery colors. This is a sad thing for our society and revealing of how much our lives are ruled by marketers.

  49. Andrew says:

    Snowy Heron–Please look up “Tax Equity and Fiscal Responsibility Act of 1982” on Wikipedia. President Reagan signed one of the largest tax INCREASES in history.

    Also, if you want more Republican tax hike history, check out marginal tax rates during the Eisenhower administration. You will be amazed–

  50. Andrew says:

    tarynkay–That was one of the best posts I have read in a long time.

  51. Johanna says:

    @tarynkay: I’m sympathetic to your view that gift giving should be fun for the giver as well as for the recipient, and for some people, “picking something out” is a big part of that. However, it’s possible to cross the line from picking something out that you genuinely think the recipient will want to picking something out that you *want* them to want. (Not saying that you, tarynkay, personally do this, but some people do.) And in that case, you can’t be surprised when your gift gets re-gifted a year or two later, or when you see it crammed unused in a cupboard somewhere.

    I don’t know anything about the anthropology of baby registries, but if it’s important to the new parents (father as well as mother) to have a color-coordinated nursery, don’t they have the right to express that preference? And if they do express that preference, why would you deliberately give them something that clashes with those colors? That’s not really in keeping with the spirit of picking something out that you think the recipient will like, is it?

  52. Jonathan says:

    @tarynkay (#48) – I agree with most of what you say. I would like to make a few points, though.

    First, even though the discussion seems to have turned into one about registries in general, the OP was about a situation where the individual specifically requested not gifts, then were pushed into creating a registry for people who insisted on buying a gift and wanted an idea of what should be bought.

    Second, with the example about the disposable diapers, you are right that there are others who would be glad to get them. Why, though, not give to those people or charities directly instead of gifting the diapers to someone you know has no plan to use them, and then put the responsibility on them to get them in the hands of someone who uses them, or store them, etc. That isn’t much of a gift, and is at best an annoyance for the receiver who now has to deal with an item they specifically asked to not receive. Some people may perceive such a gift as judgement or at least unwanted commentary on their choice to use cloth diapers, and who needs that sort of thing at what should be a joyous event.

    Third, while the specifics may not matter for small items (clothes, blankets, etc), it may very well matter for more expensive items. I always do thorough research before making any significant purchase. I know specifically which item(s) meets my needs. If someone wants to purchase that item as a gift, then that’s very appreciated. If, however, they want to purchase something similar, but not exact, then that’s just a waste of time in my opinion. I still have to buy the item I picked out, and now I have to find something to do with the unwanted version.


    Rather than stretching to compare Obama to Reagan in discussing the economy, Trent could have very easily said, “Obama is acting exactly like Jimmy Carter in the late 1970’s. Neither one understood how to generate economic growth.”

  54. tarynkay says:

    Johanna and Jonathan: I apologize for straying from the original point. I did have a wedding with no registery, and it worked out just fine. We got a lot of wonderful gifts, and a few crazy gifts, and some cash. We did not have a lot of pressure to do a registery, so I can’t address that. To address your concerns: I personally put a lot of thought into gift-giving. So no, I would not give someone a blanket that clashed with their nursery colors, nor would I give anyone disposable diapers (though I doubt that anyone giving disposable diapers was meaning to be judgmental about anyone elses diapering choices- I think that mostly, the expectant parents are thinking a lot more about their diapering plans than anybody else is. If somebody is using diapers to be passive aggressive, well, that’s just weird.) Again, if I don’t know someone well enough to give them a truly thoughtful gift, I just give cash. But of course gift-givers should be thoughtful and caring in their giving- or give cash! Everybody likes cash. But gift recipients also should not feel entitled to receiving specific gifts.

  55. kristine says:

    AndreaS- You are so right! It is better to give things that will be used, than money. My ex would blow his money on eating our and happy hour, and have no food for the kids when he had them. It took me a very short time to realize that if I gave him money (I had little myself), not much of it would be spent on the children’s food- or he wold blow it on McD and pizza delivery, instead of buying a dozen eggs, milk, peanut butter, apples, bread etc, that could feed them longer, and with better nutrition. Then he’d ask for money- for the kids, of course! So Hubby and I would only give him a bag of groc from that point on, and boy, did it burn his bonnet! But the kids were happier, and my daughter cooked their meals.

    I moved from near-poverty into a very wealthy area with great schools. At first, my daughter was humiliated by my frugal ways (the ways which allowed us to move). But after she visited one her friends mansions (actual mansions, not mcmansions), and found out the mom did the same thing as me- buy bagels day-old or on sale, and cut and freeze them. My daughter never gave me a hard time again! The only agreement we made was no freecycle clothes from our own school district- so she would not end up wearing easily recognizable cast-offs, and no curb shopping on her friend’s specific streets. I thought those were reasonable requests!

  56. slccom says:

    Re: disposable diapers for cloth-diapered kids. Many, if not most, parents find the disposables come in handy for the first exhausted few months, and for travel.

    People tend to read much too much into gifts. Criticism or praise for your decisions are seldom intended and should not be inferred unless it is explicitly stated by the giver.

    Likewise, the concept of being “bullied into a registry.” There is this really useful word: “No.” Feel free to use it as needed. I seldom even bother exploring registries, but consider that the giver may have done some research and found that the vacuum you were given was actually a better-quality product, and that is why they selected it.

    Or, I may have been collecting things for years for the recipient. I spent two years buying holiday items for each holiday after the holiday at 75 – 90% off to give to my nephew and niece and their respective spouses.

    Why? Because I remembered that when I first got married we didn’t really celebrate the holidays until the second year, when I was able to buy the symbols of the holidays on sale afterwards. This way, the kids could celebrate that first year without having to squander money they didn’t have on holiday celebrations.

    My nephew’s wife didn’t even bother to mention the gift, and commented in her Christmas newsletter on how she had had to go buy ornaments for their first tree. I had given them plenty, and fortunately, did NOT give them any of the ones I had made. My niece and her wonderful husband went through the collection in front of me, and really appreciated it.

    Going off the registry isn’t usually “passive-aggressive.” Get over it!

  57. Julie says:


    I am totally with you. I had 3 kids before registries became the entitlement list that they are today. I just registered for a handful of basic items. Today’s lists can be 10 pages long, or more with people specifying what type of bibs, bottle liners and nursing cream they want for a gift. Do you really need to specify the bibs that you want?

    I was shopping for a gift at Babies-R-Us and I watched an expectant couple being led around through the store by a registry rep. You just take the scan gun and scan everything you want, with the registry rep telling you about all the things that you need and why you need them. It is really very sad to see new parents filling up their house with a lot of unnecessary stuff.

  58. Aaron says:

    @Random Anonymous,


    Reagan and Obama are similar in that both are presidents who experienced economic trouble in their first terms cleaning up the economic messes that were created by the previous administration before them.

  59. Annie says:

    That is wonderful that you make good money at a young age but why contribue 700/month to the church. Shouldn’t you be putting away more money in your 401K or local savings. I just thought that was strange. I know physicians at my church that only donate 100/month to the church, i can’t imagine giving 700.00. that is very generous of you.

  60. Jonathan says:

    It sounds very possible that $700/month is Jill’s 10% tithe.


    Excellent comparison.
    The only problem was that Reagan reversed the disastrous policies of Jimmy Carter while Obama simply accelerated the misguided policies of George W Bush.

  62. jackowick says:

    Q4 As an ebay veteran, you absolutely have to research your item. You will find many buzzwords and search terms/abbreviations that people are seeking out. Do you know what ANH, ESB, ROTJ mean? A Star Wars fan does! Know you potential audience.

    Pictures are a huge huge plus. You can’t take a camera phone non-flash pic, you need to take your time to set up a nice pic and be sure not to get a flashback on anything shiny.

    And finally, do not lie or decieve! So many people will “forget” to list a flaw or condition note, and buyers will bite you back on this in the end.

    As far as Craigs List vs Ebay goes, I really don’t enjoy the people who insist “service A is great, service B is garbage”. I have used both, but I prefer eBay. There are pros and cons to both. Anyone who steers you absolutely towards one vs another should be taken with a grain of salt. Sell where YOU are more comfortable. Some items sell better on one site vs another. My advice above is steered towards eBay because of my own preference, but that’s exactly what it is: preference.

    Waiting to be flamed by a Craigslist fanboy in 3…2…1…

  63. Lilly says:

    Why are all my comments getting stuck in moderation?? I’ve never had that problem before…

  64. Brittany says:

    @59 Annie. Wow. I’m actively not religious, and I was offended on Jill’s behalf at your scorn over her giving to her church. Now, if she were hurting financially, I could see a gentle suggestion to reduce the tithe (if her take home is ~4500/month, she’s over the 10% tithe called for in scripture, and if she was tight on money, I’d encourage her to scale down, although not to give it up entirely if it was spiritually important to her). But she’s on solid financial footing (already maxing out retirement, meeting expenses, only debt is a reasonable amount of student loans) and asking what to do with her extra money, not how to make ends meet. In fact, I’d say your doctor friends need to seriously beef up their contributions (not necessarily to the church, but to the less fortunate in general) if they’re really wanting to make a meaningful contribution in the spirit of Christian faith, rather than Jill needing to cut hers back.

    @tarynkay– I mostly agree with you. However, I also think it’s worth considering the “rationale” of giving gifts at marriages and when someone is expecting a child: helping the couple set up house together and helping new parent(s) out as a community. No, gift-giving isn’t an obligation, but this is definitely a “practical gift” situation, unlike a birthday or holiday gift (equally optional, but not solely frivolous). I think registries can be useful for signaling the TYPES of items you’re looking for as a couple, especially since many people are semi-“established” before they get married these days and households combine in interesting ways (“Together we have 2 full sets of pans, five million sets of sheets, plenty of forks, no knives, and only 3 towels!”). The way I’ve found to best balance this (being in a life stage where I go to about 3-6 weddings a year right now) is to buy something small and practical off the register (typically a piece of kitchen equipment) with a coordinating “fun” personal gift. For example, I’ve bought a friend who already had a child a bread/meat loaf pan on her registry and a Baking with Kids cookbook and a nerdy friend a nice spatula (registry) and The Star Trek Cookbook. Another some kitchen towels (registry) and a chocolate fondue set (we made a lot of chocolate fondue together in college). It’s a balance I like.

  65. jim says:

    Brittany, I didn’t read ‘scorn’ in Annie’s words. She asked why. And she did say it was generous.

Leave a Reply

Your email address will not be published. Required fields are marked *