Financial advice from a glacier

As Summer rolls in, we can look to glaciers for some refreshing personal finance advice.

Glaciers move slowly and so should we.  It takes time to pay off debt, save for unexpected expenses and grow interest over time for retirement or college savings.  Success in personal finance is a gradual process – give yourself time to achieve prosperity.

Glaciers only move forward.  People have a tendency to get stuck worrying about questionable financial decisions they made in the past.  Forgive yourself and start with a clean slate every day.

Glaciers carve their own path.  Your neighbors might have a new car or be traveling to Timbuktu.  That is great for them!  Your path to financial success might be driving a used car and participating in a few “staycations”. Theodore Roosevelt once said, “Comparison is the thief of joy.”  Having an attitude of gratitude can help a person avoid a lot of financial heartache.

Glaciers are cool (both literally and figuratively).  If you are in financial crisis, don’t fret!  Many have been in your shoes before.  Ask for help or advice when you need it.  Having an emergency fund with a few extra dollars stashed away is a good way to stay cool when things are heating up.  The average person has $2,000.00 in unexpected expenses per year.  Start preparing yourself for the avalanche – it is coming!

Finally, glaciers smooth the way.  In our personal financial lives, we can smooth the way for others by creating a financial plan, sticking to it, and making sure that our family or friends are taken care of when they most need it.  This can be accomplished through savings, life insurance or estate planning.  Avoid meltdowns by getting your financial affairs in order today!

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Camping investments yield high returns

When I first started the Wealth & Wild blog, I wanted to write mostly on personal finance but also periodically visit topics related to adventuring in the outdoors (and the costs associated with doing that).

It is extremely important to me for my two young daughters (3 years and 5 months old) to love and appreciate nature and understand the value of conservation.  To help them do that, their father and I have made it our mission to take them with us kayaking, hiking, fishing and camping.  In honor of this mission, I would like to share with others what our experiences are when doing this — especially those that involve money.

THE COSTS OF CAMPING

It is a family tradition to camp on Current River in Southeast Missouri every year on Memorial Day weekend.  The camp sites are primitive — meaning they do not have the conveniences of home — including electric, water and (unfortunately) a sewer system.  The good news is that we have a camper that has a water heater and refrigerator that runs off propane, so we can keep our food items cold without the hassle of a cooler.  Water is limited to what can fit in our tank, so we use very little especially if we are planning a three-day weekend.  Generally we don’t view the tank water as potable.

There are some necessities when we camp which I list below:

  • Food (fruit snacks, Doritos, Oreos, jerky, powdered donuts, S’mores items… you know… the basics)
  • Drinks (bottled water to drink, jug water to make bottles for the baby, formula for the baby, soda for each different type of soda snob, tea, milk, and 14 types of Capri Sun + apple juice for my 3 year old –> don’t forget the ice!)
  • Fuel (diesel pulling a camper AND a boat + boat gas & oil + generator gas… yikes)
  • Camp site fees
  • Extra clothes, towels, sheets, pillow cases, and blankets (LAUNDRY WHEN WE GET BACK FOR DAYS)
  • Paper plates, paper bowls, aluminum foil, plastic storage bags, trash bags, plastic utensils, paper towels, toilet paper, dish soap (must have extras ALREADY in the camper or you will make one million trips back and forth when packing)
  • Paying a dog sitter for the weekend

This past weekend, we spent $333.56 on food, drinks, fuel, dog-sitting, and camp site fees – this does not include the laundry detergent and electric used to run the washer and dryer through many, many, MANY loads of laundry upon our return.  That’s a lot of money to sleep under the stars. You could almost spend a weekend in the city at a nice, air-conditioned hotel (but who wants to do that?!).

HOW TO CAMP ON A BUDGET

As you can tell from the extensive list above, we did not skimp on our “wants”.  There is a level of comfort that we currently require while toting around a toddler and a baby that only name-brand Oreos can meet.  However, a camping trip could be done in a less expensive way — even with kids.

  • Limit drinks to water and one or two other options
  • Buy store brand (generic) snack foods
  • Make a list and stick to it; leave kids at home while shopping
  • Split your camping site with other campers (as allowed)
  • Make a one-time purchase of plastic dinnerware (bowls, plates, cups) and wash/re-use them
  • Stay close to the campground — limit driving around
  • Take your dog with you – or better yet, give him away.   Just kidding.  But pets ARE expensive.

THE TRUE RETURN ON OUR CAMPING “INVESTMENT”

Our costs to camp might be a little steep, but the benefits to our family far exceed the monetary expenses we incur.  Not only do we have one-on-one time with each other and with the girls, but we have NO CELL PHONE SERVICE at camp.  Technology gets left behind.  No one is checking Facebook, reading text messages or wasting time on YouTube.  We boat on the river, kayak, fish, play on gravel bars, catch crawdads, eat S’mores, play games and tell stories around a campfire.  Do we have moments where the baby is puking everywhere and the heat of the day makes us all cranky? Yes.  Do we get hooked by our fishing lures and get eaten alive by mosquitoes? Yes.  In the end though, what we truly get is the gift of nature and time spent together.  You can’t put a price on that!  (Plus, the kids are exhausted at the end of the day and that is always a plus…)

If you have savvy ways to save while camping, please feel free to comment and share those below!

 

 

The Single Mom Student Debt Bomb

Single mothers face abundant challenges.  Motherhood in general is difficult – making sure children are well fed, clothed, educated and happy is just the start.  Add holding down a job, maintaining a home (washing dishes, doing laundry, dusting, etc.) and completing an education of their own to that equation and it can be downright exhausting!

The research

According to a report from the Institute for Women’s Policy Research, single student mothers are making up larger and larger percentages of the college population.  The number of single mothers in college more than doubled between 1990 and 2012 – which is 11 percent of all undergraduates. (IWPR 2017)

Other key findings from the Institute for Women’s Policy Research report (2012) include:

  • “30 percent of single student mothers attend for-profit institutions – triple the rate of women students without children.” (IWPR 2017)
  • “4 in 10 women at two-year colleges say they are likely or very likely to drop out of school due to their dependent care obligations.” (IWPR 2017)
  • “Single mothers who do graduate have higher levels of debt than both their nonparent and married mother peers.” (IWPR 2017)
  • “70 percent of student-parents who defaulted [on student loans] were single.” (Campbell, 2017)

These staggering statistics transparently show that single mothers have the odds stacked against them from the start of their college career.  Enrolling in more expensive for-profit educational institutions, having significant time demands between career, children and school, and the costs associated with added child care all impact a student mother’s ability to finish a degree.

Those who do not finish their degree face a precarious situation – they have student loans but no degree – so their chances of defaulting increase when opportunities for better employment decrease without that higher education.

Why college attainment for single moms is important

Research has shown that graduating from college can increase lifetime earning potential.  The median lifetime earnings for a person graduating with a high school diploma is around $1,304,000,  For someone who has earned a bachelor’s degree, lifetime earnings increases to $2,268,000 – a difference of $964,000! (Carnevale, Rose, and Cheah, 2009)

Not only do those who graduate find higher paying employment, they also have access to other important benefits, such as healthcare and retirement plans.

A mother who attains a degree also increases the chances of her children attending college as well.

In addition to the benefits listed above, keeping current on student loans and paying them in a timely manner boosts credit scores – which could be beneficial at a later time when (and if) a loan borrower seeks financing for a home or car.

How to help single moms in their quest for a college degree

Now that we know how the numbers add up, we must ask ourselves how we (both ourselves as individuals along with educational institutions and the government) can assist student mothers in starting and finishing their college degree.

Do you know someone who is a single mother who is struggling to handle a job, maintain her home and finish her education?  Here are some ways to lend a hand:

  • Offer to help with child care while she takes classes
  • Cook and deliver a meal (or two) to her home
  • Give her a gift certificate to get her house cleaned
  • Transport her kids to sporting events or extracurricular activities
  • Anonymously pay her electric bill or offer to pay for a semester of books

One existing federal program for child care is the Child Care Access Means Parents in School program or CCAMPIS.  This is a program where educational institutions apply for a grant that provides campus-based child care services for students.  Low-income parents (who are eligible to receive federal Pell Grants) may be able to take advantage of the program at those locations that offer it.

Income-Based Repayment programs, more scholarships for single mother households, peer support groups and child-friendly environments on campuses are also ways to assist those students who may need additional support. (IWPR 2017)

***

Are you a single parent who is currently attending college or who has graduated from college?  What are some ways that people have helped you along the way?  Feel free to share your tips, comments or suggestions below!

Money Talks: Allowance VS Pay-Per-Chore for Kids

At some point on our journey throughout life, we learn that money exists – and not only that it exists – but that it can be used to buy ALL THE THINGS!  This is a tempting notion for even the most resourceful adults, so assuming that children just “know” from the womb how to count, earn, spend or save their money is putting a lot of expectation and responsibility on their little shoulders!

Why we put aside the money “talk” with our kids

As adults, we sometimes avoid the money conversation with our children for several reasons.

Maybe we do not know the appropriate age to start talking about money with them.
Maybe we are uncomfortable with our own financial situation so we are embarrassed to give advice where we fall short.
Maybe we were taught NOT to talk about money from our parents or grandparents.
Maybe we just run out of time at the end of each day because we have to make breakfast, go to work, eat dinner, go to soccer, do laundry, take baths and brush our teeth…

Well… NOW is the time to start talking about money with your kids.  They will learn from what you say and what you do.  If you have experienced financial difficulties or fall short in the money department, you just have more influential life experience to share!  Do not use that as an excuse to avoid the conversation altogether.  If you were taught that talking about money is taboo, think about how that affected your financial decisions as a child, young adult or older adult.  How did that lack of discussion about money help you learn to save, invest for your future or prepare for life?  IT PROBABLY DID NOT.  If not having enough time is your excuse, remember that handling money well is a life skill that is learned – just like good hygiene or being a team player.  Someone HAS to teach you those things; they do not come naturally.  So let’s get to it!

Allowance VS Pay-Per-Chore

There is no other way for a child to learn how to use money than for them to have some.  This is the tricky part.  We do not want to spoil our kids by just handing them a big wad of cash but we also do not want to be turned in to law enforcement for child labor.  So what is the best solution?  It truly is an individual decision for each family!  Here are a couple of options:

ALLOWANCE:  a sum of money paid regularly to a person, typically to meet specified needs or expenses (example: forking out $5.00 per week on Sunday)

Advantages –

  • Allowances require no adding/subtracting for whoever gives the allowance; it is the same amount each week, regardless of the situation.
  • The kid knows what they are getting. If you give them $5.00, you might say, “Save $1.00, give $1.00 and spend $3.00.”  It is easy to track for everyone involved.

Disadvantages –

  • No ownership. Your kid can sit on their booty watching YouTube videos of other kids opening mystery toys or they could be working 20 hours per week doing laundry, washing dishes and cleaning toilets.  There is no connection from the dollar to what is or is not getting accomplished.
  • Kids may not know WHY they are getting money. This can be confusing even for adults.  If someone handed you $100.00 on Sunday without any explanation, what would YOU do?  (Pedicure, anyone?)  Or, if they said “Here is $100.00, make sure you get some work done.” How much effort would you really put in?

PAY-PER-CHORE: paying a set amount for each job duty or household chore completed (example: paying $0.50 if they feed the cat or $1.00 if they pick their toys up by the end of the day)

Advantages –

  • They can work more to earn more. This is very similar to most “real life” jobs where you work to earn a wage.  If you are lazy, you get nothing… (Well, usually…)
  • THEY are in charge of their own destiny. If they want a new bike, a princess movie or the newest electronic device, they can learn to calculate how much that item is – and how much work it will take to purchase it.  This is also very similar to how adults make purchases.  We identify what we want, figure out the cost and set aside money out of our budget to buy it.
  • You can put emphasis on bigger jobs (washing the car or doing a whole load of laundry) by offering larger sums of money.

Disadvantages –

  • With pay-per-chore, it is best to give as much immediate feedback as possible; it is more effective if paid out daily – and this can be a little cumbersome. Who has $3.20 in their purse or wallet right now?  ….Exactly.  Weekly is fine too.
  • An adult actually has to use their brain and figure out chores and how to pay for them.

In each household, there will be chores that are just a part of being in the family unit.  Maybe the kids are expected to do the dishes after dinner or feed the cat and there will be no payment for that.  It is okay to say, “Some of these tasks are for keeping a roof over your head”.  To teach good money habits, however, it is imperative that children have actual money to use.

My challenge to you – no matter what your background is with the almighty dollar – is to sit down with your children and give them clear expectations about what types of jobs are considered to be “non-paid-you-are-part-of-the-family” jobs and paid jobs.  If you choose to give an allowance, explain what needs to be done to fulfill that allowance (if anything).  If you pay-per-chore, explain how you “priced” each task and why some have higher earnings potential than others.  Give those kiddos the opportunity to fulfill their financial destiny!

I’m a cheater.

I’m not ashamed to admit that I have been cheating the entire month of January.  This is a difficult realization for me because I am usually not the type to fall for temptation(s), but I’ve determined that I cannot be perfect all of the time.  The bad news is that I “fell off the wagon” – so to speak – in JANUARY of all months, so I am feeling like my year has maybe gotten off to a bad start…

The good news is that the cheating was on my BUDGET and not on my husband (or my diet) and this has happened before and both I (and my budget) have fully recovered.

THE INFIDELITIES

So what happened?  First, my husband’s uncle decided to sell his 2004 Ford F250 truck that has FOUR doors.  FOUR DOORS PEOPLE.  We had been looking for a truck that would fit our growing, two car seat family for some time, but this one was a gem (over 10 years old but with only 55,000 miles) so it was a no-brainer to make the purchase.  This was a dent to our cash accounts of about $20,000.00, so obviously an “unexpected” event this month.  Second, we had a baby in December.  This is something that I did plan for, but you cannot ever plan enough for a new human being to enter your life.  We ate out more before baby arrived (hey, we were going to be stuck inside forever from now on, right?), ordered more pizzas than normal after getting home from the hospital and I just didn’t pay as close attention to our spending…  Oopsie!

WHY STICKING TO A BUDGET IS HARD

“Budgets are made with logic.  Purchase decisions are made with emotion.” – Martin Hurlburt, co-founder of T.M. Wealth Management

I’ve never read anything more true in my life!  When I set up my budget at the beginning of each month (or prior to) I create it with an “everything-is-black-and-white-there-is-no-grey-area” point of view.  The numbers add up perfectly where every dollar has a place, so everything should go splendidly.  Unfortunately, life happens!  We heard about that truck and of course we were thinking “ahhhh, less anxiety sitting in the back seat” and “the girls will love the extra space” and “this will be perfect for our family vacations” — all emotional “grey area” viewpoints.  This is ONE reason that budgeting is hard.

Another reason budgeting is difficult is people set them up with unrealistic expectations.  This might mean they add extra money in the income line because they are HOPEFUL that they get some overtime this month.  Or, they don’t have miscellaneous or “sinking” funds set aside to cover unexpected expenses like the garbage disposal getting clogged up or the dog getting his toe chopped off by the lawn mower.

If that doesn’t make it difficult enough, it is easy to lose sight of our goals — especially those larger ones — because sometimes it just takes awhile to get there.  Saving money ain’t easy.

HOW I (AND YOU) CAN CREATE A SPENDING PLAN (A.K.A. BUDGET) THAT WORKS

Yes, we all those months where we cheat and we feel like our budget could never forgive us. HOWEVER, this is not an excuse to quit budgeting forever, just like falling off of the diet wagon is not an excuse to be fat forever. Our budget is fluid.  It should change from month-to-month based on increasing or decreasing income and/or expenses.  We might have zero birthday gifts to purchase in January and 14 birthday gifts to buy in March.

Start by sitting down with a blank piece of paper and a pen (if you have a spouse they should be there too… a separate post on getting your spouse on board is coming…).  Write down every source of income you KNOW is coming in for the next month.  Then, pull out your bills and write down every expense you KNOW is going out for the next month.  For items that are difficult to determine an amount for, go back and track what you have historically spent for that month *or* review your bank statements for spending in that area and use an average of the last 2-3 months spending.  It is not going to be 100% foolproof.  Include at least one or two lines in your budget for miscellaneous expenses or you can actually name sinking funds for things like “car maintenance” or “roof fund for the next hail storm”.  These line items will help catch those crazy things that come up that would usually break the budget.  As a final sidenote (and probably a topic I will cover more in-depth later) you need to pay YOURSELF something in savings.  If you don’t have at least $1,000.00 in a savings account as an emergency fund, be sure to put space in your budget to put aside $50,  $20 or even $10 from each paycheck to build up that EF!

Start fresh in February!