My 2 Cents

Financial Advice From a Five Year Old

Wednesday, April 14th, 2010

My son Tyler takes after me quite a bit. Sometimes that is a good thing. Sometimes, not so good. One of the traits that he picked up from me (and his mom) is his patience. Or more appropriately, his lack there of. Like his parents, when Tyler gets excited about something, it is pretty much all he can think about. And talk about. And dream about. Case in point – the Nintendo Wii.

Tyler first became aware of the wonderful world of Wii while visiting his cousins in Houston. To Tyler, no one is cooler than his cousins, and nothing is more fun than playing with their toys.

It just so happens that going to his cousins is like going to Disneyland – even I get excited when we get to go play at their house – so I can only imagine how much fun it is for a 5 year old boy.

On one of our visits, Tyler had his first Wii experience, and it was love at first sight. For days, all he could talk about was how Mario did this and Luigi was super fast at that. As a family, we weren’t ready to join the Wii club just yet – I think Andrea was worried about the potentially dangerous combination of video games and my obsessive-compulsive behavior. Over time, a few of Tyler’s friends started getting them and he was able to play his favorite video games more frequently. It was also at this time, that he instituted his Chinese water torture strategy.

Roughly 13,276 times each day, Tyler would very sweetly ask if he could get a Wii. Genetically speaking, poor Tyler has two strikes against him with respect to impatience, so we tried to handle his endless requests with care and diplomacy. It wasn’t easy.

As much as I also wanted a Wii – let’s face it, I was as excited as he was – I always try to make sure that my kids aren’t spoiled. I didn’t grow up with a lot, so sometimes I can be a little overdramatic with the “when I was a kid I walked uphill both ways to school” stories. It is important to me that they know the value of a dollar and appreciate how fortunate they are, but I definitely overdo it sometimes. There’s a fine line between constantly lecturing a toddler about the economic realities of life, and giving them a toy when they want one. At least I have been told there is one. Most of the time I err on the side of the economics lecture. Kailey looks at me like I am crazy when I start droning on about how much harder life was when I was her age.

Realizing that Tyler was not physiologically capable of stopping his quest for a Wii, Andrea and I decided to embrace the situation as an educational opportunity. With Tyler, we decided that if he really wanted a Wii, he could buy one with his own money. If he didn’t have enough in his piggy bank, he could start doing chores around the house to earn money to finally buy his Wii. Tyler was excited and started working right away. Andrea and I were pretty proud of ourselves. We felt like even Super Nanny would be proud of us. I was particularly excited about teaching Tyler the value of working hard, experiencing the satisfaction of achieving a goal, and understanding the value of a dollar. Plus, I could finally play a Wii!

Over the course of about a month, Tyler earned enough money to buy a Wii. I had planned on this exercise being a longer term sacrifice for him, but apparently he is quite the little saver. Either that or he is working nights and weekends without our knowledge, because when he opened his piggy bank on day 1 of Operation Wii, he had almost $160. We are thinking about asking him to take over the management of our finances, but we will most likely wait until after he graduates from kindergarten.

To earn the rest, he helped out around the house, did his chores, vacuumed,

you name it and he was all over it. He turned out to be quite the little fundraiser as well. He talked his sister and his grandparents into donating to the cause, and he would have had his friends on board as well had we not stopped his impromptu fundraising rally on the playground. Every quarter he earned was immediately counted, stacked and inventoried with the rest of the money. It was quite a production.

Eventually, he had earned and saved enough money, and he was able to buy his Wii.

He loves his Wii. Except for the fact that I can not beat him at boxing or Mario Kart, I love it too. He is only 5, so I don’t want to fool myself into thinking he totally understands the value of a dollar, but it was great to see him set a goal, work hard for it, and enjoy the results of his hard work.

As I watched him playing it the other day, it reminded me of a similar experience I had when I was a kid.

I was around 13 years old, and on a family shopping trip to Montgomery Wards, I happened across the coolest thing ever. It was a personal, portable television, and to me it was fantastic. Every fiber of my being told me that I must have that TV. The fact that it was black and white, and the screen was maybe like three inches wide did not deter me. For some reason, I had to have it. Unfortunately, it cost around $75, and given my family’s financial situation, $75 might as well have been $100,000. We just didn’t have that kind of money. Especially not for a tiny, portable, black and white television.

As I stared at the TV, I couldn’t help but daydream about how great it would be to watch it in my room, in the car (it even had a plug for the cigarette lighter), in a park, anywhere my heart desired. As I think back, I honestly am not sure exactly why I wanted it so badly. I don’t know if I wanted it because I just really loved television, or if I wanted it because my parents told me it as a bad idea. I imagine that, being a teen, it was probably a little of both.

Just like Tyler and his Wii, if I wanted that television I was going to have to pay for it myself. Easier said than done. We lived in the middle of nowhere, so mowing the neighbor’s yards or washing cars wasn’t really an option. Our nearest neighbors were about a mile away. My only real source of income was a couple of dollars a week for allowance. Needless to say, I worked my buns off for almost 6 months to save the money for that TV. It was all I thought about. I hoarded every spare penny I could find. Over and over, I counted my money hoping that it had somehow magically grown overnight. I was so excited when I finally had enough.

In my mind, that little TV became a much bigger deal than just a tiny, black and white television. At the time, we didn’t have a lot of nice things. The idea of having my own TV, regardless of how little it was, meant more to me than it should have. It was the ultimate status symbol for a kid who was tired of being poor. Selfishly, I didn’t think about how hard it must have been trying to raise a family in financially difficult times, I was just tired of having second hand stuff and knock-off brands. That little TV was my chance to have something brand new, something expensive. Repeatedly, my mom told me that buying that TV was a mistake, but I had worked so hard. I was going to show them that I was smart enough to make my own decisions. I knew best.

So I bought that little black and white television with my hard earned money, and proudly held it in my lap the entire drive home. Once home, I announced that if anyone needed me, I would be watching television in my room. I felt like a Rockefeller. For about 7 minutes.

Turns out it is virtually impossible to get a television signal in the middle of nowhere with an 18 inch antenna. I never actually got to see a clear picture on it. Not once. Six months of hard work down the drain. It was horrible. I felt horrible. I had poured everything I had into that little TV, and ended up with nothing more than an incredibly expensive paper weight. As far as paper weights go, it was definitely top of the line, but it sure would have been nice to get a clear picture on it at least once. For a couple of months I would occasionally watch static on the little screen rather than admit that it had been a bad idea. At least my parents never said “I told you so”.

I am by no means miserly, but I would be lying if I said I wasn’t probably too “overly value conscious”. To a certain extent, I might still be overreacting to my little black and white television fiasco. Once bitten, twice shy I guess. Like all the other areas of my life, I am working on trying to achieve better balance, even in financial matters. There is a time for saving – for remembering the lessons of my little TV and responsibly saving for the future – but there is also a time for enjoying some of our hard earned money. To me, the key has been remembering not to turn material possessions into more than they are. At the end of the day, it’s just stuff. A TV is just a TV (or a really nice paperweight) and a Wii is just a Wii. It could all be gone tomorrow, and it wouldn’t be the end of the world. Of course, it would be hard to end my Wii career without beating Tyler at least once at Mario Kart, but I think I would survive.


The Agony of Decision Making

Tuesday, March 2nd, 2010

I will be the first to admit that I have never been particularly good at making decisions. It’s not that I can’t do it; it’s just that I tend to turn even the most trivial of decisions into enormous life changing events that I agonize over. Ultimately, I am capable of making decisions, but the amount of time and energy I spend can’t possibly be healthy. Everyday, I see people making important decisions with relative ease, and yet on more than one occasion, I have taken well over a week to decide whether or not the timing was right for a haircut. A $9 haircut.

I am not sure that I fully subscribe to the “birds of a feather flock together” theory of relationships, but when it comes to agonizing over making decisions, Andrea and I are two peas in a pod. Individually, we are world-class over-analyzers and Internet researchers. Together, we could literally grind the entire world to a halt if it was dependent on us for an answer. Now, in my opinion, thinking before you act is responsible. What I believe is unhealthy is creating 72 spreadsheets, developing exhaustive pros/cons lists and spending hundreds of hours on the Internet trying to determine the best sand & water table for a two year old.

Even to me, that just doesn’t feel right.

And yet, that is what we do. Whether trying to determine when to start Tyler in kindergarten (important) or whether or not to get a trampoline for the backyard (not important), the amount of energy, time and stress involved in the decision making process is the same. That can’t possibly be considered “healthy”.

The other day, Andrea and I finally bought a new car. My first car cost $800. Ironically, that purchase decision took me all of about 3.4 seconds to make. In the world of cars today, you really can’t get much for $800 anymore. Not like the good old days.

As you might imagine, given how expensive new cars are, we spent a fair amount of time thinking, researching and worrying about the decision. I think it was the summer of 2007 when we first decided that it was time for a new car. We have been overanalyzing this decision so long that a couple of our initial options have actually gone out of business. I should be smart enough to realize that this might be an indication that we are taking too long to decide, but all it really did was give me an opportunity to create a brand new set of spreadsheets for factoring in the likelihood of bankruptcy with the remaining cars.

For the record, I really don’t enjoy agonizing over all of the various decisions that need to be made during any given day, week or month of my life. Apparently, I am just wired this way. I always want to make the “perfect” decision, so I must just think that if I spend enough time and energy on it, that I will be able to make the right choice. Unfortunately, on several occasions, our “perfect” decisions have resulted in a counterproductive buy high/sell low strategy.

“There’s no way Enron stock can go any lower.” I made this bold statement after about two months of detailed financial analysis on the state of the company and its current stock price. Fully convinced that it was impossible for a Fortune 50 company to go out of business in a matter of months, I dipped my toe into the stock market and bought shares of Enron at $14/share. What a golden opportunity!

Who knew? Apparently everyone but me. My shares are currently worth less than the paper they are printed on.

“It’s a perfect house for us, let’s do it.” When Andrea and I bought our first house a few years ago, the timing felt right. We were getting ready to expand our family. Finally ready to settle down. After about 6 months of Olympic-caliber research and worrying, we signed the paperwork and moved in. We were home owners! In retrospect, I am fairly confident that our final unpacking was the event that triggered the collapse of the housing industry. For what we paid for our house, I have been told that we could now buy a thriving, mid-sized, rural community.

These are just two examples of how effective we have been with our research and analysis. Unfortunately, there are more. Like our BowFlex Home Gym that was a home gym for about 2 months, and a towel rack for 2 years before we sold it at a 92% discount. Suffice it to say, not all of our decisions have been home runs. And some have had far reaching impacts – the complete failure of Enron, the collapse of the housing industry. I don’t think this can be considered insider trading, but as an FYI, we ended up buying a Mazda. If you work for Mazda, own stock in Mazda or have recently purchased a Mazda, I am truly sorry. We just love the car.

So, what to do? It’s not like I can just suddenly stop making decisions. Every day, as an employee, a husband, a father, and a friend, I am required to make decisions. Rarely do I have all of the information necessary to make the “right” decision. What I have started to realize is that the answer isn’t in trying to do more research, worrying more, or agonizing over trivial details more. I have tried that. It doesn’t work. It’s about making the best decision I can with the information that I have. And then, most importantly, not dwelling about it afterwards. Sometimes my choices work out. Sometimes they don’t, and my kids end up with incredibly expensive Enron stock certificate craft paper.

All I can do is try to make the best of the situation and learn as much as possible, so next time I can hopefully make a better decision. Even in those times when I could not have been more wrong, it hasn’t been the end of the world.

It sounds a bit cliché, but I do think that life is too short to waste any of it worrying about things outside of my control. Most likely, I will never be an efficient decision maker. I will probably always find something to worry about. By trying to do a better job of picking and choosing what decisions are worth agonizing over and which aren’t, I feel like I am improving. Not every decision is a dramatic, life changing event. Just realizing that has made it easier for me to actually make them.


An Appropriate Level of Detail

Thursday, January 28th, 2010

I love the concept of “self help”. I honestly do. I love that millions of us are fed up and are ready to make some changes to our lives. As someone who regularly needs help, and someone who also likes to tackle my own challenges, I feel like self-help books were made for me. Yet, more often than not, when I find myself in the self-help section of the bookstore, I end up walking away feeling thoroughly confused, not knowing where to start. The rows and rows of books are rife with seemingly contradictory messages. One big source of confusion came as a result of my sincere desire to stop getting worked up over trivial details.

Eager to make a change, I headed to the bookstore. Almost immediately, I was drawn to a set of books that encouraged me to “not sweat the small stuff.” Wonderful. Having spent the bulk of my life training to become the greatest small stuff worrier of all time – oh, if only worrying were an Olympic event,

I was excited for the change. But as I turned to leave, another series of titles caught my eye. In the same self-help section, literally on the same shelf as the “sweat-free living” books, I found several other books that proclaimed the critical importance of being ever vigilant regarding “the devil in the details”. What to do?

To be clear, I don’t enjoy stressing out about every little detail. I have friends and family who seem wonderfully indifferent to “the small stuff” and they appear to be perfectly happy. I don’t know how they do it, but I am a tad envious. Several years ago, when Andrea and I were working on a consulting project in Europe, we were able to do quite a bit of sightseeing. Almost every weekend, we would plan a getaway to some incredible European city. For the bulk of the trips, given my obsessive-compulsive nature and my need to plan everything out to the nth degree, I was our logistics coordinator.

Most countries we visited spoke some English, but I still showed up with maps, printed directions, brochures, travel guides, books, translation sheets, virtually everything that a traveler might EVER need to survive in a foreign land. One time, Andrea took the lead on planning our trip to Berlin. Needless to say, I was incredibly excited to go, but I would be lying if I said a large part of me wasn’t completely stressed out. Particularly since I wasn’t in control of “the details”.

When we landed, I followed Andrea to get a cab. As we got in, our cabbie turned around and gruffly asked “Ver?”

Andrea: “Marriott, please”.

Cabbie: “Mahdiut?”

Andrea: “Marriott.”

Cabbie: “Mahdiut?” (Slightly angry this time)

Andrea: “Marriott.”

Me: “I don’t think he understands you.”

Andrea (slower and louder, like when you talk to your dog): “MMMAAARRRIIIOOOTTTTTT.”

Cabbie: Odd stare that was an unsettling mix of confusion and anger.

Me (pulse quickening): “He’s not deaf, he just hasn’t heard of the Marriott. Show him the map.”

Andrea: “I don’t have a map.”

Me (pulse now racing, tense smile at cabbie): “Show him the printout from the Marriott site.”

Andrea: “I didn’t bring that.”

At this point, my blood pressure skyrocketed and I am fairly confident that I blacked out for a few seconds.

Cabbie: A string of angry German that, even without any understanding of the language, made it abundantly clear that he 1) had never heard of the Marriott, 2) had no idea what we were talking about and 3) was not particularly fond of clueless, English-speaking visitors.

I don’t remember the next 20 – 30 minutes, because I was focused on trying to avoid having a heart attack. I was most assuredly “sweating the small stuff”. I am not sure exactly how she did it, but somehow we made it to our hotel.

And in typical Andrea fashion, she had developed a strong new friendship with our cabbie. Sadly, I think my unhealthy attention to detail has started to wear off on Andrea, as evidenced by the roughly 1,300 hours she recently spent researching bedding for Kailey’s new bed.

Given the fact that I had been a “devil’s in the details” person most of my life, and was not entirely pleased with my resulting mental health, I chose to try not sweating the small stuff, and bought the book. After all, it sounded easy enough. Since making that decision, I have been presented with countless opportunities to sweat profusely over details, yet I have made every effort not to.

Recently, I noticed that Tyler’s bedroom door was making a lot of noise as it was being shut. At 5 years old, he is at an age where he likes to assert his independence by storming to his room and slamming his door whenever he is unhappy. As a result, the screws holding the hinges to the door had become stripped. Since I didn’t really want to buy a brand new door, I had the bright idea of swapping out his door with the one to the kids’ bathroom, since it is never used. Not sweating the small stuff, I went to work.

It took less than 15 minutes, but the whole time I was doing it, I couldn’t stop patting myself on the back. Great idea, saving some money, not getting worked up over the broken door, just going with the flow. Everything seemed fantastic, and I couldn’t have been more proud of my personal growth.

Turns out there was a devil in the details. Tyler has had his new, state-of-the-art, side-vent, non-shutting door for well over a month now and he doesn’t seem to mind. I have tried to convince him that it is cool and unique.

As much as I need and enjoy self-help, I don’t think things are as black and white as a lot of the books sometimes make them out to be. Having tried a lifetime of obsessing over “the devil in the details” and more recently not “sweating the small stuff”, I am now trying a healthy balance of both. Sometimes I get it right. And sometimes I don’t, and I end up with more doors that won’t close. Regardless of the outcome, by focusing on balance, I actually feel like I have achieved some level of self-help. At least for today.


The Pressure of Being Santa

Friday, December 25th, 2009

I love Christmas. It is such a wonderful time of year to spend with family and friends. Plus, it’s the only time of year when you can celebrate a Savior’s birth and get trampled trying to buy Tickle Me Elmo for your child. I know that Christmas isn’t all about the gifts, but based on the roughly 1.6 million people I recently ran into at Target, I don’t think everyone got that message.

You might think I’m crazy, but I actually really enjoy Christmas shopping. There is no better time to witness the highs and lows of humanity than during the holiday shopping season. On any given trip to the mall you can see everything from precious children anxiously picking out the perfect present for mom to acts of bone-chilling terror. “Terror” may sound dramatic, but until you are confronted by a frazzled mom who desperately needs that last Zhu Zhu Pet that you just put in your cart, you have no idea.

Being in the holiday spirit, I decided to help her out and I gave her the rat – I think it was a rat. Actually I gave it to her because 1) it was quite possibly the ugliest toy I have ever seen, and 2) the look in her eyes made it abundantly clear that she was fully prepared to rip my heart out of my chest in order to get her hands on it.

Growing up, I never received the “hot toy” for Christmas. My parents simply didn’t have the means. And I survived.

Now, as a parent, I look back and wonder if that was hard on them or not. Every parent wants their child to be happy, and it seems like all kids are programmed to want the most popular, most hard to find toy more than anything else in the world. I am sure that every year my sister and I would beg and plead for whatever was the “it” toy – a Cabbage Patch Kid, Lazer Tag guns – and hope with all of our might that Santa would deliver. He never did because they couldn’t afford it, and now I look back and pray that I didn’t act like an unappreciative brat. At the time, I didn’t realize the amount of pressure that Santa was under. Now that the responsibility of being Father Christmas has fallen to me, I am much more sympathetic to his challenges.

I didn’t realize that Santa was responsible for driving to the mall and endlessly circling the parking lot waiting for an elusive parking spot to become available. During my last trip it took me just a shade under 30 minutes to park. At one point, I was afraid that I was going to run out of gas. I wonder if Santa ever had to have his sleigh towed? I also didn’t realize that doting parents are willing to do virtually anything to get their hands on certain toys. Apparently adults are a little less worried about being on the “naughty list” than their children. Finally, I didn’t realize just how fickle our little angels can be. Nothing like finally tracking down the perfect gift, only to have them announce over dinner that they have completely changed their minds.

Christmas morning, Tyler and Kailey will wake up and there will be no Zhu Zhu Pet under the tree. I think they will survive. I know that Christmas is not about the presents under the tree, but they don’t. They are only 5 and 2 and are convinced that Jesus’ birthday is the greatest day of the year because a heavyset, older man in red velvet is going to break into their house, eat their food and leave them presents. They seem perfectly okay with the whole breaking and entering thing.

What I love best about Christmas is getting to see it again through Tyler and Kailey’s eyes. I didn’t realize it, but as I have gotten older, I stopped appreciating the little things during the holidays. I love their pure excitement when they see all of the beautiful lights on the houses. Or how they work together so diligently to make sure that Santa has the perfect cookies and hot chocolate with exactly 10 marshmallows waiting for him. Their precious innocence, infectious excitement and sheer joy are so uplifting. Being Santa definitely has its challenges, but having a plate full of cookies with “my” name on it isn’t all bad.

Merry Christmas to all and to all a Good Night!

PS – You would not believe how much work it took to get this picture!


 

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- Ralph Waldo Emerson

 
 

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GOOD STUFF

The Jungle

Author: Upton Sinclair

Category: Book

Gritty book about working class in Chicago at the turn of the century. If you ever felt like things were going bad for you, read this book to help put things in perspective.