The Seven Biggest Used Car Buying Pitfalls (and How to Avoid Them!)

(This is a guest article by Paige Green*)

Whether it’s your first car or you’re tenth, we are all prone to some rather basic mistakes when it comes to making the decision to buy. After all, a car is emotive and appeals to some basic primal need we seem to have for things that are shiny and go very fast. (Historically, our great great grandparents were probably suckers for a speedy horse with a well groomed coat). Unfortunately for our ancestors, they probably didn’t have the same access to information that we currently do, so there was nothing they could do if their prize pony turned out to be a training nightmare. Learn how you can avoid the pitfalls of car financing and purchase by arming yourself with information.

Seven Ways NOT to buy a Car

Falling in Love and getting blindsided

Your perfect vehicle, it looks great, drives like dream and you’ll be the envy of all your peers – if you have your heart set on the car of your dreams – STOP! This is one of the most obvious traps of car buying, especially if you’ve spotted the love of your life in a dealership parking lot. Becoming blindsided and committed to a particular vehicle without first determining the implications of the purchase can mean you’ll be drowning in heavy debt or be bound to particularly unfavourable terms.

Not doing your Research

The decision to buy a car is not a light one and before you step into a dealership or start considering internet auctions, you need to do your research and find out what sort of vehicle will suit your needs. Consider your lifestyle requirements as well as your budget and financing options. Don’t forget to account for the future, if you’re not sure what your situation will be like in five years, you might not want to commit to a vehicle that’ll lock you into a particular style of living for the long term.

Buying and Borrowing out of your Budget

If you’re looking at financing options, it’s tempting to borrow up and “get something you really want”. Remember that defaulting on your monthly payments will seriously affect your credit standing and will have a substantial impact on any future financing. Remember to also consider depreciation costs and other factors that will affect the final value of your vehicle and your assets.

Not looking into finance

When you walk into the lot, the dealer usually offers you instant dealer finance to help you with your purchase which always seems tempting since there’s no lengthy and nervous waiting time that comes with bank loans or the unsettling and embarrassing possibility of rejection. The problem is that without doing your research and considering all of your car financing options, you can end up paying exorbitant fees and higher rates in the long run.

Not test driving

As internet auctions become more prominent, it’s sometimes too easy to just purchase a vehicle based on the owner’s description and not actually doing an in person inspection, especially if the seller is out of state etc. It’s hard to get the information you really need to ensure that a car’s performance measures up to the promised description.

Not Doing a Thorough Inspection

Do your own check for oil (you want to make sure it’s clear and not dirty) and look for any signs of water damage as this could lead to expensive problems in the future even if the vehicle is running great now. When buying a used car, it’s best to consider getting the vehicle inspected by a professional mechanic. For a few extra bucks, it’s worth it to hire a mobile inspector to visit the site and do a quick on the spot check to make sure the car is in good working order. Alternatively, bring along a friend who knows about vehicles.

Not Getting a History Check

By running the Vehicle Identification Number (located on the driver’s side dash or in the door jamb) through vehicle check, you can obtain the full history of your car and find out if it’s been in any accidents or has any outstanding debt attached to it. Don’t take a seller on his or her word, but arm yourself with the necessary information to be a wary buyer.

*About the author: Paige Green hails from the Land Down Under and is an expert at driving on the left side of the road. She waits eagerly for Lemon Laws to be introduced there and also writes for Australia’s leading experts in car finance.


*Image Credit: Photograph by Jeremy Brooks [via Flickr Creative Commons]

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Chasing Money - Is There Ever An End To It?

I chatted with an old friend today after a long time. And while we were talking about our jobs and how our companies fared, he told me that they had recently got a new CEO. And as a matter of conversation, he mentioned that the new CEO was going to be paid something along the lines of 30+ Million dollars in stocks (restricted units, not options!), in addition to 1.2 Million dollars in annual salary and 2.4 Million dollars in annual bonus, to take the job. The numbers were just mind boggling. And this new CEO guy is just 45 years old!!! As most conversations with old friends go, we were all over the place, and before we knew it we were debating about whether we would even want to be in the shoes of this guy.

On the one hand, being just 45 and being offered so much money to take on a job seems like an incredible accomplishment. Especially for a guy who was just like us - with a Ph.D. degree and not a fancy schmancy M.B.A degree or someone who wasn't exactly born with a silver spoon in his mouth. How cool is a life with millions of dollars to throw around!!! On the other hand, how much life would this guy have had? He must have worked his butt off to get where he did right? Sure, luck and timing and being at the right place at the right time had something to do with it.... but unless he burnt a lot of midnight oil and stressed out enough to turn several hair gray, I doubt he could have got where he is today. When you are busy building such a high profile career, where is the time for the simpler things in life? To smell the roses, to attend your children's plays and recitals, to cook a meal with your spouse and enjoy it on the back porch? What good is several million dollars, if you don't have time to enjoy spending it? We consoled ourselves that our average Joe jobs that paid decent salaries while allowing us time with our families was good enough.

After I hung up the call though, I couldn't stop thinking about this. Are we really that different from this CEO guy, other than the fact that we don't make a multi-million dollar salary per year (that's a big glaring difference, but lets ignore that for a second, shall we?). Let me take my example. I am currently *very* pregnant but I still continue to go to work, so I can save all my PTO for the time after the baby comes. Even with all this saved vacation and the short term disability pay, I will have only about 9 weeks of time off with my new baby. And then I need to make a choice - either go on unpaid leave or return to work. And I am not very open to the idea of going on unpaid leave for long periods of time :(

Now, do we *need* the pay I will get by foregoing those few weeks of unpaid leave? Well, not really. The better half makes a decent salary, and we have some money in both short and long-term savings and we can survive fine without my paycheck for several weeks, months or maybe even years. So, why am I so reluctant to forego a few weeks of salary? Ultimately, are we all addicted to money so much, that we cannot stop chasing it? Do we all just trade in our time blindly in the pursuit of money? In some cases like that of the CEO guy its millions, and in other cases like me it is a few thousands but is it the same thing? Do we all intentionally (or out of habit) just chase financial security at the cost of quality family time?

I don't think I am cut out to be a stay at home mom. I admire those that have made the brave decision to give up their careers to raise families. But a large majority of my friends and the people I know are like me - they have reluctantly got back to work after having babies. They spend the days from morning to late night switching roles - an ideal employee to an ideal mom to an ideal spouse. Trying to advance the career and bring in a bigger paycheck, while at the same time trying to be a good mother and wife and provide a good nurturing family. Balancing, juggling, being super women....

What is it that fuels this insane desire to chase money? Is there ever an end to it? Do any of you ever wonder, or is it just my pregnancy hormones talking? :)

*Image Credit: Photograph by David M* [via Flickr Creative Commons]

PS:This article was featured as an Editor's Picks in the Carnival of Personal Finance #165 over at No Debt Plan. Head on over there for some really good reading...

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Guide to Hiring Women!

I received an email from a friend with this “Guide to Hiring Women” supposedly published in the July 1943 issue of Transportation Magazine. Apparently, it was written for male supervisors of women in the work force during World War II. I couldn’t quite believe it and decided to dig a little further. Looks like it is not just spam or a hoax after all! Snopes.com claims to have verified the legitimacy of the article and has images of the original print version on their site! All I have to say is, Thank God, I wasn’t looking for a job in the 40’s!

Eleven Tips on Getting More Efficiency Out of Women Employees

There's no longer any question whether transit companies should hire women for jobs formerly held by men. The draft and manpower shortage has settled that point. The important things now are to select the most efficient women available and how to use them to the best advantage. Here are eleven helpful tips on the subject from Western Properties:

1. Pick young married women. They usually have more of a sense of responsibility than their unmarried sisters, they're less likely to be flirtatious, they need the work or they wouldn't be doing it, they still have the pep and interest to work hard and to deal with the public efficiently.


2. When you have to use older women, try to get ones who have worked outside the home at some time in their lives. Older women who have never contacted the public have a hard time adapting themselves and are inclined to be cantankerous and fussy. It's always well to impress upon older women the importance of friendliness and courtesy.


3. General experience indicates that "husky" girls - those who are just a little on the heavy side - are more even tempered and efficient than their underweight sisters.


4. Retain a physician to give each woman you hire a special physical examination - one covering female conditions. This step not only protects the property against the possibilities of lawsuit, but reveals whether the employee-to-be has any female weaknesses which would make her mentally or physically unfit for the job.


5. Stress at the outset the importance of time the fact that a minute or two lost here and there makes serious inroads on schedules. Until this point is gotten across, service is likely to be slowed up.


6. Give the female employee a definite day-long schedule of duties so that they'll keep busy without bothering the management for instructions every few minutes. Numerous properties say that women make excellent workers when they have their jobs cut out for them, but that they lack initiative in finding work themselves.


7. Whenever possible, let the inside employee change from one job to another at some time during the day. Women are inclined to be less nervous and happier with change.


8. Give every girl an adequate number of rest periods during the day. You have to make some allowances for feminine psychology. A girl has more confidence and is more efficient if she can keep her hair tidied, apply fresh lipstick and wash her hands several times a day.


9. Be tactful when issuing instructions or in making criticisms. Women are often sensitive; they can't shrug off harsh words the way men do. Never ridicule a woman - it breaks her spirit and cuts off her efficiency.


10. Be reasonably considerate about using strong language around women. Even though a girl's husband or father may swear vociferously, she'll grow to dislike a place of business where she hears too much of this.


11. Get enough size variety in operator's uniforms so that each girl can have a proper fit. This point can't be stressed too much in keeping women happy.

What the @$^% ?!!??!!!

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Medical Tourism: An Option for Keeping the Cost of Uninsured Medical Bills Down

Some day, if I ever get comfortable talking about it, I will write in detail about the reason for this post. For now though, let me just put some information out there for those of you who are fighting with medical conditions that are either not sufficiently covered through insurance or the wait time at your local medical facility is far too long.

What is medical tourism?
Simply put, it is a combination of tourism and medical treatment. In earlier days, people from developing countries (who could afford it) would travel to developed countries seeking state-of-the-art medical treatment. However, in more recent years, due to the increase in health care costs and the long wait for some specialized procedures in developed countries combined with the availability of sophisticated medical treatment in developing countries, the trend seems to have reversed. People now go from countries like USA, Canada, Japan, UK etc, to developing countries like India, Thailand, Singapore, Hong Kong, Columbia etc. where same level of medical attention can be obtained for a fraction of the cost. According to this article medical tourism is poised to be a multi-billion dollar industry and studies estimate that medical tourism could bring between $1 billion and $2 billion USD into India alone by 2012.

What are the medical conditions for which one may opt for medical tourism?
In general, medical tourism is an option to consider for elective procedures which may not be covered by insurance or requires a long wait in the native country. Examples include cardiac surgery, joint replacement, dental procedures, plastic/cosmetic surgery, infertility treatment, lasik eye surgery etc. In addition, medical tourism has attracted patients seeking alternative medicines when modern science fails and for recuperative medical spas.

Which countries offer medical tourism options?
Here is a map that was originally published in this article that shows the different countries that offer medical tourism options.


What are the advantages of seeking medical help abroad?
The first and foremost is of course the significantly reduced cost of treatment. According to Wikipedia, - "A heart-valve replacement that would cost US$200,000 or more in the U.S., for example, goes for $10,000 in the Philippines and India—and that includes round-trip airfare and a brief vacation package." Treatment for other medical conditions can also cost anywhere from 1/3rd to 1/10th the cost in US, UK or Canada offering significant savings.

In addition, many of the facilities in developed countries have long wait periods for surgeries that may not be life-threatening. Countries that cater to medical tourism offer patients quick treatment options thus helping prevent long painful waiting periods for treatment.

For those that like the exotic, medical tourism offers packaged travel deals with luxury accommodation and special attention while still keeping the cost less than that of just the surgery in the home country.

Contrary to common stereotype image of the developing countries, the facilities that offer medical tourism provide quality state-of-the-art medical treatment by professionals trained in the best medical facilities around the world and are leaders in their field.

What are the things to be aware of while considering medical help abroad?
One of the biggest concerns with medical tourism is that the countries that offer medical tourism may not have stringent malpractice laws as the US, UK or Canada. That means that if something were to go wrong, there will be little option for recourse.

Since you will likely return back to the home country within a few days/weeks after the medical procedure, there is very little scope for follow-up care and the patients must look to the local facilities in the native country if any post-procedure follow-up is required.

In some cases where the treatment stretches for months, it may be required to stay in the foreign country for long. While this may be viable financially, attention must be paid to emotional and psychological comfort of the person going through the difficult times in a foreign land.

Finally, there is the ethical question that many of the facilities ignore the local patients in their eagerness to please the patients from developed countries with fatter wallets.

Where can I find more information?
A simple Google search for the term “medical tourism” yields a lot of information. Here are some of resources I found helpful

• Wikipedia


• CBC News article


• Time.com article


• Medical Tourism 101, A complete Guide


• Medical tourism accreditation information


• JCI accredited organizations


• Article about nonprofit medical tourism accreditation service


• Medical tourism discussion forum

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Get Rid of Unwanted Mail. It's Bad for your Wallet and Bad for the Environment

(This article is a part of the Blog Action Day that brings together 14,000+ bloggers from different walks of life in a global effort to increase awareness about environmental issues.)

In an earlier life, I would open every piece of mail I received in my mail box to look for coupons. And if I found a coupon that I liked I would be off shopping. I mean, what’s not to like about 20% discount at Bed, Bath & Beyond, right? Well, here’s what – I did not really need anything from Bed, Bath and Beyond! I was essentially being conned into spending for the purchase of an item that I didn't particularly care for. That is just one of the evil ways that junk mail can harm your wallet. And the evil it wreaks on the environment is so much worse!

How Unwanted Mail Costs you Money!

• They are a source of temptation to spend money.

Marketing people have spent years and years learning the human psychology to figure out how they can con consumers into buying more stuff. As mentioned above, it may be a coupon or a discount or a check for some money if you start a service etc. Or it may be catalogs with pretty pictures that instill a yearning to go buy stuff. Overall, the unwanted mail instigates a desire to buy stuff that you otherwise don’t need or think of.


• They add clutter and clutter can cost money.

If you do not immediately sort out the necessary mail from junk mail and throw away the junk mail, you will soon find your house/apartment cluttered with paper. Some important mail can easily be lost in this clutter resulting in late payments (and some hefty fees) or lost opportunities.


• Your tax dollars are spent to get rid of the junk mail you throw away.

According to the Stopjunk website, it costs 320 million of tax dollars for disposing off the unwanted mail! That’s money not spent to improve our schools, public transportation, roads and other really worthy causes. And that’s our money that is getting wasted!


• You spend precious time to sort through them and time is money.

According to the New American Dream website, Americans throw away 44% of bulk mail unopened, yet still spend 8 months per lifetime opening bulk mail. OK, those statistics could be quite hoakey and not all of our time may be spent in productive money-earning tasks, but do your really want to spend that time in sorting through junk mail or would you rather be spending it with your kids or watching TV or reading books etc?

How Unwanted Mail Hurts the Environment

• Unwanted mail = wasted paper = cutting trees unnecessarily.

According to the New American Dream website, more than 100 million trees’ worth of bulk mail arrive in American mail boxes each year – that’s the equivalent of deforesting the entire Rocky Mountain National Park every four months. According to this newsletter article an average American family receives more than a tree’s worth of junk mail every year! Each of us who has not got rid of unwanted mail is directly contributing to deforestation.


• The Energy cost of producing and disposing junk mail is exorbitant.

Not only is unwanted mail causing a lot of trees to be cut, it is wasting a lot of resources as well. If Americans receive several million tons of unwanted mail, imagine the energy used up in printing these material. And the fuel consumed to transport these to your door step. And the chemicals spent and the green house gasses generated in the process! According to the fact sheet on the New American Dream website, the production and disposal of direct mail consumes more energy than 3 million cars! That is just not worth it!


• Not all junk mail can be recycled!

Some smart dumbass marketing manager some place decided that glossy paper will entice more people into buying their product and convinced the powers that be to finance a marketing campaign that only uses glossy paper. As if that were not bad enough, they decided to use colorful ads and probably staples too. The result is that I end up with a fantastic looking catalog that I am not interested in, but cannot recycle!


• Not everyone recycles their junk mail.

Even if the junk mail was recyclable, not everyone makes the effort to recycle the junk mail. It is sad to see millions of tons of paper go directly from mailbox to trashcan to landfills after having consumed so many of environmental resources!


• Unwanted junk mail fill up landfills.

The unwanted mail that is not recycled or cannot be recycled ends up in landfills. According to the statistics on this website 40% of the solid mass that makes up our landfills is paper and paperboard waste. By the year 2010, it is predicted to make up about 48%. While not all of this may be due to unwanted mail, considering that about 40 pounds of junk mail is sent to every adult each year and approximately 44% goes to a landfill unopened, I would think junk mail makes up for a large percentage of the paper that gets into land fills.

What you can do about it.
It’s simple. If every household makes an effort to minimize the junk mail they receive, together we can stop this monster that wreaks havoc on our money and the environment.

• Opt Out of Prescreened Credit Card Offers

A joint venture of the three credit bureaus helps stop prescreened credit card and insurance solicitations from landing in your mail box. You can opt out by calling the toll free number 1-888-5-OPTOUT or online through the website www.optoutprescreen.com.


• Register for the Direct Marketing Association’s “Do not mail” list.

While there is no law at this time that requires companies to not mail you because you have registered with the “Do not mail” list, most companies recognize that if you have gone so far to add your name to the list you will likely just throw away any offers they send you. So in the interest of saving money and guarding their reputation, many companies who are part of the DMA stop sending you offers. There is a charge of $1 for this service though and the response is slow since the main database is not updated on a continuous ongoing basis. You can register online using this form.


• Turn down local coupons and fliers.

According to postal regulations, all fliers must be accompanied by an address card or an address label. This may be in the form of a post card with a missing child’s photograph or a label on one of the fliers and will likely be addressed to the “current resident” or “occupant”. This card/label will have information that will help you identify the company that is mailing out the fliers. Look online or in yellow pages and call the company directly to have your address taken off the list. Here is the contact information for three of the major flier/coupon/catalog mailing companies –

• ADVO, Inc.: Call up (888) 241-6760 or use this online form.


• Val-Pak Coupons : Call up (888) 797-1896 or use this online form.


• Abacus, Inc. : By e-mail: optout@abacus-us.com with “remove” in the subject line and name and address in the mail.



• Cancel catalogs from individual stores.

When you receive catalogs in mail, look for a customer service number and call up right away before you forget and ask them to stop sending you any more catalogs.


• Opt for E-bills and electronic statements.

Every time I receive my credit card bill or a bank statement, I find that the envelope is stuffed with a bunch of fliers and offers. This junk can be reduced by opting for e-bills and e-statements. But it may not work for everyone. If you are like us and paranoid that you might forget to send a payment without the regular paper mail reminderrs, then you may not want to go for this option.


• Unsubscribe from unwanted magazines.

Magazines are one of the biggest leaks in most people’s budgets. If you have a credit card that gets automatically charged every year, then you may not even realize that your subscription has been renewed. The magazines that you liked last year may not appeal to you now and may end up in a pile on your coffee table without ever being read. Please call the unread magazine companies and cancel your subscriptions. This way you can not only plug the money leak, you can save the environment too.


• Mention explicitly that you do not want information sold.

When you sign up for any new service or subscription, clearly write the following next to your address – “Please do not sell, trade or make publicly available”. It may or may not help, but hey, no harm trying!



• And finally, if some unwanted mail sneaks into your mail box recycle it.

Recycling is catching on in most big cities in the US. Here in Texas, there is a scheduled recycle pick up that is aligned with regular trash pick up, in most cities. Also, many apartment communities offer specially marked trash cans for recyclable items. Actually, at our previous apartment there was a recycle bin right next to the mail boxes so we could dump the unwanted mails as soon as we picked them up and have them recycled. I am not sure how widespread the effort to recycle is, but do your part. If in spite of all the steps above you continue to receive unwanted mails, try to dispose them off in a responsible manner.

More resources for learning about junk mail
If you have more questions and are looking for more information, check out these resources for more information.

• New American Dream website.


• Frugal Green News Letter.


• Smart Money Article.


• Ecocycle article.


• Privacy Rights Fact Sheet.

If each one of us does our part, we can make sure that our environmental footprint is kept small and our future generations can continue to enjoy this planet as much as we do. And saving some money in the process is a nice bonus :)

*Image Credit: Photograph by sparkyourart [via Flickr]

~~~o0o~~~

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~~~o0o~~~

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Whoa, Pets are Expensive!

Here is something I overheard during lunch yesterday. I know eves dropping isn’t exactly good manners, but in my defense, these ladies were talking very loudly, and I was sitting all by myself with nothing to do, waiting for my friend to join me.

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Lady 1: “My mom gave Vic (son?) a dog for his birthday, and its killing me!”

Lady 2: “Um… hmmm….”

Lady 1: “My apartment charges $500 pet deposit. In addition to that I spend $12 a day on doggy day care since both Tom (husband?) and I work. And today I got a call from the day care that Timmy (the dog?) had swallowed something and was coughing and dry heaving. So they took him to the vet. The vet charges $43.99 for inspecting the dog. But since Timmy was very agitated and snapping at them, they wanted to sedate him first. That would cost an additional $100. And if he has indeed swallowed something then it would cost an additional $159.99 to retrieve it. It’s crazy. I asked Tom to handle it.”

Lady 2: “You can’t be serious! That’s over $300 just because your stupid dog swallowed something? You need to get rid of that dog!”

Lady 1: “I don’t know. Vic is so attached to him. And Timmy is really very sweet and affectionate…”

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At that point my friend arrived and I had to leave to get my lunch. But boy, was I shocked! That’s a lot of money they were talking about. When we moved into our own house, one of the first few things I wanted to get was a dog. I pestered my husband about it (and still give him a hard time sometimes), but he managed to talk me out of it saying its too much work and the dog will be “depressed” if there is no body at home all day. (I think the thought of having to pick the doggy doo was what really persuaded me though – but that’s a different conversation). After listening to the ladies today however, I am glad we didn’t get a dog!

When I came home I remembered that conversation and thought I would just check online if it really cost that much. I came across this site which has the national average vet costs. Reading this, it seems like the lady in the restaurant was actually getting away cheap :) Here are some of the costs from that site –

Gastrotomy (to retrieve swallowed object): $274
X-rays: $58 for the first, $36 for each additional
Anesthesia (per half hour): $56
Preanesthetic sedation: $23
Preanesthetic exam: $28
Anesthetic monitoring: $19

I have no idea what Preanesthetic sedation is or why it would even be needed, but boy, those costs are quite staggering. I browsed a little more and found several articles that talk about similar high costs. Wow, that’s something.

I really love dogs and would love to have one, but seriously, I doubt if I can afford one at this cost!

If you are thinking of getting a pet, be sure to think of the financial aspects among other things and make an informed decision!

If you already have a dog and love it, here are some articles that might help you keep the costs down. I understand that once you get attached to a pet, and it becomes a part of the family, you will not want to “get rid of it” or be too stingy with medical expenses. We had dogs in our house all through my childhood and I cannot imagine giving away the dogs that we had come to love because they cost too much. But I hope, some of these articles will help you find a way to keep the costs down and manage the expenses as efficiently as possible!

• 57 Creative Ideas to Save Money As a Pet Owner at the Frugal Panda.


• Outrageous Vet Bills at the Dollar Stretcher.


• Put Fido on a Budget: How to Save Money on Pet Care at Googo bits.


• 13 ways to save big on pet care at MSN Money.

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Putting My Money Where My Mouth Is

If you are a regular visitor to this blog, then you have probably heard me complain that schools don’t do nearly enough to teach kids the value of money. Well, last week an opportunity to do something about it presented itself in the form of an email from HC, the author of the blog One Big Mortar Board. HC proposed that we PF Bloggers participate in the Blogger Challenge by the charitable organization Donors Choose that hooks up donors with public school teachers. HC picked four projects that are focused on spreading financial literacy among young kids. Now it is our turn to make it a success.

The goal is to raise $1500. If we are successful at this, we can aim for a stretch goal of $2400. That covers the four projects that were originally suggested by HC. There are four more projects in the pipeline, if we manage to exceed the stretch goal as well. I sure hope we will !

I made my contribution yesterday. I hope some of you readers will consider participating in the challenge as well. Even $1, $5 or $10 can go a long way in making this campaign a success. If the projects from this challenge can change the financial perspective of even a few students, then the money donated is money well spent!

Here are the other bloggers (that I know of) who have made a pledge so far -

• HC @ One Big Mortar Board.


• Flexo @ Consumerism Commentary.


• Mapgirl @ Mapgirl's Fiscal Challenge.


• Single Ma @ Single Ma's Fabulous Financials.


• English Major @ An English Major's Money.

Together, we can make a difference!

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Blackwater Incident: A (Spineless) Taxpayer’s Rant

This is not a political blog. And I am not trying to make a political statement. But the Blackwater incident in Iraq from last weekend just doesn’t sit well with me. So, here is my rant. Do with it what you wish.

Here is what bothers me – Blackwater employees who are just regular citizens of America like you and me, shot and killed the citizens of another sovereign country Iraq, on their own soil. Now, since Blackwater is not part of the military, those responsible cannot be court martialled under the Uniform Code of Military Justice. Since they are not on US soil, the US laws do not apply to them. They cannot be tried by the Iraqi legal system due to the provisions of the Coalition Provisional Authority Order 17 in 2004. [source1, source2] And who paid for this mercenary operation that is above and beyond the reach of any law? You and me – the clueless, hapless, (spineless) taxpayers!

Blackwater was founded in 1997 by an ex Navy Seal with a keen entrepreneurial bent of mind. As a for-profit private organization that trains and provides security to diplomats, Blackwater has supposedly increased its profit by over 300% during the past few years. Finding its profit statements on the Internet is not very easy, but according to the wikipedia entry, during the past few years, Blackwater has received over 500 million dollars in government contracts (many of them being no-bid contracts)! While I was reading about Blackwater and its founder and trying to wrap my brain around the number of zeros in the financial figures involved, I couldn't help but visualize the smug face of Nicholas Cage from the movie Lord of War.

Frankly, I don’t know whether companies like Blackwater do a great service to the country (as their website claims) or they are mercenaries without a conscience. In the words of U.S. ambassador to Iraq, Ryan Crocker [told to the U.S. Senate]: "There is simply no way at all that the State Department's Bureau of Diplomatic Security could ever have enough full-time personnel to staff the security function in Iraq. There is no alternative except through contracts." [source]. The Blackwater employees do put their lives in harms way every single day and have suffered the chilling consequences more than once [Fallujah Ambush, Other Incidents]. In matters of war and conflict, the facts are so hazy and every story has so many sides that it becomes hard to make any judgment. That said I wish my hard earned money did not go into funding hazy operations flirting with the boundary between good an evil. I work hard for every penny and wish my tax dollars would go into projects where the benefits are clearly observable like improving the schools or the health care system or the public transport system.

I know I ought to be more involved and more active in the political decision making process, and yet I am not. I know I ought to question and hold the politicians who use my tax contributions accountable for their action and yet I don’t. I live my comfortable suburban life with my cushy job socializing with my equally clueless friends. Until the day the war is brought home by someone who straps on a dozen bombs (or flies an airplane) in a desperate and deliberate attempt to kill people who are near and dear to me. He is on a suicide mission because he does not have anything to live for. His father / mother / brother / sister / wife / child was “collateral damage” in a war funded by my money and he just could not find any other way to snap me out of my idyllic apathy and make me take notice.

And so, just this once when my conscience is pricked and I have decided to at least rant things out, let me come out and say - Please, stop using my tax dollars for funding your meaningless wars. And don’t tell me it is for freedom and democracy – I may be spineless, but I am not dumb.

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Student Bloggers: Here Is You Chance To Make $10,000 From Your Blog!

Back in January, I had written about the Student Blogging Scholarships. Well, the deadline for the monster $10K scholarship is almost here! All you student bloggers out there have a little over 3 weeks to put the final shine on your blogs. The submission deadline for nominations is October 6th. Public voting will begin on October 8th and the winner will be declared on October 28th. For more information about the scholarship, check out the College Scholarships website.

Considering the hefty award amount and the broad scope, I suspect the competition will be quite stiff. I hope that one of you student bloggers writing about personal finance will win the scholarship – at least that way we can be sure that the winner won’t blow away the *entire* 10K on parties :) To help you add that final touch to your blog, here is a list of blogging tips shared by prominent personal finance bloggers. Good luck, and if you decide to put your name in the hat, be sure to leave a comment below so I (and hopefully some of the readers) can vote for you!

• 25 Steps To A Wildly Successful Personal Finance Blog by Jim at Blueprint for Financial Prosperity.


• How to Get Your Blog to 100,000 Visitors and Beyond (Series) by FMF at Free Money Finance


• How Not to Blog: Self-Defeating Behaviors by jdroth of Get Rich Slowly (Published at Meta Best Blog Win)


• Building a Better Blog for 2007 (Series) by Trent at The Simple Dollar.


• 50 Tips for New Personal Finance Bloggers by Clever Dude at Clever Dude.


• How to Start a Blog by Kira at Penny Foolish.

(I am sure there are many more good articles that I have missed - please feel free to share your favorites with the aspiring student bloggers!)

Two other sites that are not related to personal finance, but you must read (if you want to be a serious contender, that is) are Problogger and Copyblogger. Now be warned though, you could spend days together on each of these sites and not even realize it! And with the deadline so close, the more time you spend on reading about blogging, the less time you have to write on your blog – so watch out! I would recommend setting a restriction on how much time you allocate for improving your blog and how much for writing, *before* you visit either of these sites. To improve your efficiency, here are two good starting points for your quest

• 31 Days to Building a Better Blog (@ Problogger)


• How to Attract Links and Increase Web Traffic – The Ultimate Guide (@ Copyblogger). While you are there don’t forget to check out the magnetic headlines series too.
  

Well, good luck y’all. I sure hope a fellow finance blogger will take in the trophy this year. God knows there are enough of you out there who are well capable!

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Do You Treat Missed Opportunities as Personal Loss?

While reading the book "One up on Wall Street" by Peter Lynch, I came across this concept of "regarding somebody else’s gains as your personal loss". While this concept is discussed in the book in the context of investing, it stuck a cord with me because of the way I treat the financial aspects of my personal life. My problem isn't exactly treating somebody else's gain as my personal loss. Rather, I view all missed opportunities (usually highlighted by somebody else's gain) as my personal loss. Let me explain –

I came to the US to get a Master’s degree and when I completed my degree I had two very lucrative job offers on my hands. At that time however, I had absolutely no concept of the importance of money and chose to turn down these offers and go for a Ph.D. In the decision process, money was not even a consideration. I have absolutely no regrets about this decision in general, but every now and then the financial implications of this decision strikes me with pangs of misery. I am quite sure every person out there who has chosen to go for a Ph.D. (or any other degree for that matter that requires a person to be in school for several years earning a little over minimum wages) can relate to a certain extent.

Further thought on this matter reveals that if everyone I know had made the same decision and was in the same financial boat as me, it probably would not bother me as much! But, on the contrary all my friends chose to take on well-paying jobs and start stabilizing their financial lives. During the course of the 4 years in school, I did realize that my friends were better off than me, but it did not really bother me much. When I completed my degree I had multiple job offers and while evaluating the different aspects of the package the huge gap between my financial situation and that of all my friends started to sink in. Among my offers, one company had no 401K match at all and the other had a 6% match. While I was reading up about whether this should be of any importance in my decision to accept an offer, I started to draw parallels between me and my friends. If all my friends had contributed the max to the 401K and had received at least a 3% match and earned an annual interest rate of 8% on their savings, then during the 4 years that I was in school, they had managed to put away around $75K towards their retirement account. That’s a *HUGE* head start when you consider the power of compounding and I don’t know if I can ever catch up.

Frankly, I don’t know if all my friends did contribute to the 401K or not. But I started to regard the lost opportunity as a personal loss. It was (and is to this day) a source of discontentment for me. While I have no regrets about spending the additional time in school (and view it as one of the nicest phases in my life), the fact that I did not know about 401K or IRA and did nothing to put away any money, is a thorn on my side. It is a great motivator for me to stay frugal and save as much as possible now. And maybe because of this keen sense of the “personal loss” I have a better appreciation for every penny I manage to save.

In the very long run, by the time we actually retire, I don’t know if it will really matter. Yes, I started late, but if I stay sensible from now on, maybe I can catch up eventually. Even if I don’t, I doubt if that will really bother me. Growing up in a middle class family, I am used to being surrounded by richer friends and have learnt to automatically disregard it. And, at this point in my life, I have come a long way from my childhood financial situation, and am quite content with what we have and feel blessed. So, why this sense of personal loss over lost opportunities? Why this self sabotage of the peace and happiness over a choice I made consciously (and will likely make again, knowing all that I know now)? Peace, happiness, contentment, joy – it seems human psychology has a masochistic tendency to destroy them every time you feel you have started to achieve them.

Do you treat missed opportunities as personal loss? Is it a real loss or is it a game your mind is playing with you? There must be a reason you missed those opportunities and in non-financial terms, maybe they mean a lot more to you than the money you could have made if your took those opportunities. So why fret and lose your peace of mind over it?

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My One Money Advice

I generally only post on Mondays, Wednesdays and Fridays. But Loonies and Sense tagged me for the my one money advice meme over the weekend and coincidentally, there is this one piece of advice (a reminder actually) that I have been repeating to myself over and over during the past couple of days. So I decided to go ahead and jot it down. Here we go -

Never ever decide to do anything when you are not emotionally stable.

It's not necessarily "money advice" per se, but it applies very well to financial decisions as well. When we are disappointed, frustrated, depressed, angry or just plain blue, we generally tend to make silly mistakes that we later regret. When applied to our financial lives this could result in a shopping binge, dumping a stock before its time, paying a premium to take an impulse flight, banging a door so hard that it requires expensive repairs, whatever.... A split-second action can lead to a long period of regret. That's just not worth it. Wait it out - do what it takes to while the time away - go have a good cry, stuff your face in a pillow and scream, vegg out in front of the TV, write abstract blog posts, anything. Like everything else, this will also pass. Once you calm down, if it still feels like it is the right thing to do, then you can go ahead and do what needs to be done. For now, the only decision should be to put off a decision. Sometimes, procrastination can be a good thing.

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An Open Letter to My Free-Loader Friends

I am sure every group of friends has one or two of these people who take “mooching” to the next level and almost make an art form out of it! I have a couple of such friends too (and by the tone of this post you will likely guess one of them is starting to tick me off!). In general, they are very nice people and a lot of fun to hang out with. They are witty, charming and full of life, and I really like hanging out with them. But the moment the time comes to part with a few benjamins and they start slithering and sliming away. A slip of hand, a slight change in conversation and before you know it you find yourself picking up the tab. Heck, sometimes you may not even notice that you were suckered until much later when bam, it hits you - “Not again!” There are few things I would like to tell these friends, but can never really bring myself to say it out loud, because (a) I don’t want to be mean or rude and (b) like I said before, these are nice people that I like to have as friends, but for their free-loading tendencies. So, here is an open letter to my free-loader friends…

• I would love to hang out with you at the coffee station (or the pub), but will you please promise me that you will pay for your own coffee (or drinks)?


• Why is that we should go to the closest restaurant for lunch when you drive, no matter how dumpy the place is but it doesn’t matter how far the restaurant is when the rest of us drive?


• Maybe you didn’t notice, but when we pay the bill after lunch we do pay taxes and tips. If not the tips, we would appreciate it if you would at least pay for the tax part for your portion of the meal!


• Please, please, please don’t take a handful of mints, just because they are free!!! You are embarrassing all of us!


• Keep your hands off my lunch box. Especially the cherries! They are expensive and I bought them as an indulgence and an incentive for packing lunch instead of eating out!!!


• Yes, we need to throw her a baby shower and get her a gift! No, I don’t think your baby’s old clothes and toys can be “bundled” up into a hand made gift! Yeesh!


• Please don’t try borrowing movies from me and the other guys “after we are done watching” – its way too cheap. You can rent a movie at the movie kiosks for a buck, for crying out loud!


• When we go out for movies and you look around and ask if anyone needs popcorn, we all know you are saying “someone please buy me some popcorn”. Dude, just come out and say it!


• And finally, it is as hard for us to make our money as it is for you to make yours. So how about reaching for your wallet before one of us reach for ours, at least once in a while?

Phew… that felt good :)

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Traditions and Superstitions: Silliness from Around the World

It does not matter how rational some people are. When it comes to money matters, if they hear a superstition or tradition, they will likely follow. Why tempt fate by breaking the rules of some arcane science from unknown ages, right? All this came up yesterday afternoon when my friend gave me some money to settle some old shared expenses. Since I had a lot of stuff in my right hand, I extended my left hand to receive the money. But she insisted that I put down the stuff and receive the money in my right hand because “money received with your left hand won’t stay with you”. I couldn’t help but remember what seems to be another universal superstition – “if the palm of your right hand itches, you will come into some money and if the palm of your left hand itches you will lose some”. I don’t understand why over the ages and across cultures the left hand receives such step-sisterly treatment!

In the evening when I was randomly browsing, I decided to look up to see if I can find something on the Net for this downgraded treatment of the left hand (yes, I was that bored!). I wasn’t much successful to this end, but came across some pretty amusing superstitions and traditions from cultures across the world. Here are some for your light weekend reading.

Europeans and the “penny in the shoe”

Across Europe in many countries, a penny is inserted in the bride’s shoe to start her off in a life of prosperity. It is believed that this tradition may have started in Britain (source) based on this wedding rhyme

“Something old, something new
Something borrowed, something blue
And a silver sixpence in her shoe.”

In the US, it looks like the first two lines of the rhyme are traditionally followed, but not really the “penny in the shoe” part.

It seems like this custom is quite common across several European countries though. For instance, in Sweden (source), the mother of the bride gives her a gold coin to go in her right shoe, and her father gives her a silver coin to be placed in her left shoe. This way the parents are assured that the daughter will never go without. In Hungary (source), it is customary for the new bride to dance a “money dance.” The male guests “pay” to dance with the bride by either pinning money to her dress or dropping money into her shoes which are in the middle of the dance floor.

Germans and “the lucky penny” or "Glueckspfennig"

Millions of Germans believed (source) that their team made it to the 2002 soccer world cup finals because of a "lucky" penny, or "Glueckspfennig". Before each match the penny was buried in the ground on the play field and many believed that this was responsible for the 8 straight undefeated matches that the German team had. Pity, the lucky penny did not help the Germans win the finals, the one match that really mattered :)

Jamaicans and “wishing on the new moon”

In Jamaica (source) apparently there is the belief that when you see a new crescent moon, if you hold up a coin and wish for money, in the month that follows, as the moon increases in size, so will the money you have. That seems easy enough – I should try that. Of late it seems like I am only losing money each month – maybe the moon can help reverse that trend :)

Chinese and “the number 8”

In the Chinese culture, the number 8 is considered very lucky (source) since the word used to say “8” sounds similar to the word used to say “fortune”. Additionally, two 8’s together is supposed to bring double the joy. Some people believe in this so much so that they will base their investing decisions on the occurrence of the number 8 in the ticker symbol or the value! (source - subscription required). Wow, I thought that the stock market here in the US was unpredictable – can’t imagine what it must be like for a rational trader in China!

Indian subcontinent and “is it the good time yet?”

In India and Sri Lanka, the general masses believe a lot in astrology. The astrological charts predict for each day, which hours are the best times to do business (“gulika kala”) and which are the worst (“rahu kala”). During the rahu kala, people avoid doing anything auspicious or major money transactions (source). I wonder if they take into account the different time zones while following this - for instance, if you want to buy something on Ebay, do you go by the Indian time or the American time? :)

Russians and “when you receive some gifts you should give back some money!”

In Russia, it is believed to be inappropriate to give anyone a sharp object (like knife, scissors etc) as a gift. Also, you cannot give your hot girlfriend a cute puppy (or a pig or a snake or any other animal that she fancies) as a gift. If under some unavoidable circumstances you must give these items as gifts, then the receiver of the gifts should give you back some symbolic money so the invisible forces that made these rules can view this as a trade and exempt you from untold misfortunes in the future! Also, if you gift someone a purse make sure it has some symbolic money in it so you don’t inadvertently curse them with poverty. And while we are at it, while in Russia – don’t whistle indoors! Russians believe that this will result in you “whistling away all the money”! (source)

Japanese and “the snake skin in the wallet”

Japanese believe that a snake is a symbol of good fortune. So they believe that if you carry a piece of snake skin in your wallet, you wallet will never go empty and you will become rich (source). All I have to say for that is “EWWWW!”. No offense, but “EEEEWWWWW!”

Latvians and “don’t place the dinner knife vertically”

Apparently, in Latvia it is believed that if you place the knife on the dinner table vertically next to the dinner plate, the person sitting in that seat will lose all his money. Even in restaurants, the knives are placed horizontally above the dinner plates (source). Now that’s a strange one, don’t you think?

There were many more smaller ones I came across, but after a while they stopped being funny anymore - there is only so much silliness you can take in one day :)

Do you follow any traditions or superstitions for no reason?

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Three Words For New iPhone Owners: "Shame On You"

Finally, the iPhones are available in stores! Across the country in Apple and AT&T stores, people waited in line for days to be the first ones to own the must-have gadget of the year. The sleek sexy look, the enticing ads, the cool new touch pad technology, the 4 to 8 gigabytes of memory, the built in iPod -- just writing about it makes me drool! Fortunately, before my desire to own the device turned into an all consuming obsession, I came across this article which puts the cost of ownership of the phone over two years - the required contract length with AT&T, the exclusive carrier for iPhones - to as high as $3,000. Even if one were to buy the lower end model and the lowest cost service plan, they would still have to fork out close to $2,000!

We are so steeped in consumerism and advertisement induced materialism in this country that we seem to have lost sight of how big a number that is! $2,000 to $3,000 for a cell phone!!! Don’t you see how ridiculous that is? If not, maybe you should take a step away from the TV and the blogs touting the virtues of the iPhone and look at the world around you for a minute. Maybe things will start to fall in perspective...

According to this world bank map (click on it for an expanded view) other than the developed countries, most other parts of the world have at least 10% of the population living on less than $1 a day, the threshold for describing extreme poverty. In some parts of the world more than 50% of the population is below this threshold! That means $2,000 is equivalent to about seven years of subsistence for a large part of the world. And you still think nothing of blowing it away on one gadget!!!

OK, let’s leave the extremes behind and look at the averages. The June 11th edition of TIME magazine had an interesting article titled "How the World Eats" (available online as a photo essay). The article/essay shows photographs of average families from different parts of the world and their weekly food expenditures. One of these images remained with me, and I couldn’t help but think of it when I was musing about the high cost of owning the iPhone, and American consumerism in general. The Namgay family of Shingkhey Village in Bhutan, shown in the picture below, have a weekly food expenditure of $5.03. If you count carefully, there are 13 mouths to feed. The reason this photograph stood out for me was that, these people do not look "poor". Rather, they came across to me as fairly average family content with what they have. Who says (other than the marketing and media folks) that you need a $2,000 device to achieve simple joy and contentment?



If you are still not convinced, let’s try something closer to home. According to this article on MSN Money Central, the average American household carries $8,000 in credit card debt. Considering that statistic, I would assume that a lot of the people who bought the iPhone put it on the credit card, and will likely pay their monthly service fees using credit cards too. If they do not pay off the bill in full each month, the lust for one device increased their debt by over 25%. Was it really worth it?

Overall, I am quite convinced that unless a person has no debt, has made sufficient plans for a secure financial future and contributes to at least a few charitable organizations, he/she has no business buying an iPhone. Of course, if you were born with a silver spoon in your mouth go right ahead and buy that phone – an iPhone in your hand goes perfectly well with the silver spoon in your mouth :) But if you are an average Joe who now owns the over-priced over-hyped gadget and owes a tad bit more to the credit card companies than before, I have just three words for you -- shame on you!

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Ford College Student Discount

I received an offer in the mail saying I qualified for a $500 discount on any new Ford vehicle that I purchased because I had recently graduated from college. This discount can be used in addition to whatever the promotion the dealers offer. I am not a big fan of buying new vehicles and even if I did, I doubt I would go for a Ford. But if there is anyone out there who is looking to buy a new Ford vehicle (2006, 2007 or 2008 models) before January 2008, then this may be a good deal for you.

Here are the eligibility requirements –

You are eligible to take advantage of this offer if you:

• Are an undergraduate student currently enrolled full-time at an accredited Four-year College/University, Junior College, Community College or Trade School in a minimum of 2 classes of an equivalent of 6 credit hours, OR
• Graduated or will graduate from an accredited Four-year College/University, Junior College, Community College or Trade School May 1, 2005 and Jan 2, 2008*, OR
• Are currently enrolled in an accredited Graduate School program.

If you are interested in this offer, you can find more details on the Ford College Student Purchase Program 2007 website.

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Confronting the Joneses

This past weekend we had a get together and met some of the better half’s old friends that he had not met in years, and some I was meeting for the first time. I was a bit skeptical about the trip at first, but as it turned out, it was a really nice trip. I had a great time hanging out with all of them and enjoyed the packed weekend to the hilt. I also had a chance to confront my internal Joneses.

I think each one of us has our own different projection of who the Joneses are. For me, the Joneses are any of our friends and relatives who are roughly our age or younger but seem to be doing so much better. For instance, the couple that hosted the get together has a lovely home in the suburbs with tall trees in the back yard and upgrades all over the interior. The home costs almost twice as much as our own. Another set of friends drive a Lexus SUV, while I drive a 14+ year old car with 150K+ miles on it. Another set of friends has been investing heavily in real estate back in the home country, something that we have only recently dipped our toes in. I could go on, but that is not the point. The point is that, for the first time in my life, instead of feeling envious and resentful and wanting to catch up, I could calmly look inside me to confront my internal Joneses. I could weed out my disappointments and replace them with more positive feelings.

This train of thought started because of something someone said during a conversation made me realize that there are some things that *we* do or own, that makes us their Joneses. I know that we have had to make a lot of sacrifices and cut the corners and juggle our priorities to afford what we do. So I am assuming that the rest of them have had to make their sacrifices too to afford what I envy. When you think of it that way, it all boils down to simple choices – we picked apples and they picked oranges. We cannot afford oranges right now, since we have already bought our apples. There really is no point in drooling over the oranges, since we have our apples. If we really do want oranges AND the apples, we just have to work towards it slowly and start saving for it!

When I started looking at things from this angle, I could really appreciate the value of what I have instead of all the things that I don’t have. For instance, let us take the example of our home. Yes, our home costs half of what their home does, and does not have as many upgrades. But I really love our home. So it doesn’t really matter that I don’t have some of the things they do. I could possibly have all the things they do but at what cost? Am I willing to trade my choices and sacrifices with theirs? And the answer comes back as a vehement “Of course, not”. I don’t even know what their choices or sacrifices are! Even if I did, I have found that in general the choices that other people make with their lives just don’t fit with mine. So, thank you very much, I will keep what I have and what is mine already and not want to trade places with anyone for any reason.

Now all this is assuming that we all make similar amounts of money and so have to make similar sacrifices. What about those who make more money than us? Or those that seem to have to make fewer sacrifices? Well, if we start thinking along those lines, we can never be happy. No matter how successful or rich we are, there will always be someone who is more successful and more rich. It’s like trying to shoot a moving target that is way more agile than we are. Instead, focus on a bunch of goals. Maybe these are motivated by the Joneses, maybe not. But, instead of chasing the Joneses who are constantly changing, if we chase these fixed goals, then we stand a much better chance of succeeding. Of staying happy.

And we need to constantly re-evaluate what sacrifices we are willing to make. What worked for the Joneses may not work for us. Then again, it just might. Yes, there are a few Joneses out there who just got lucky and do not seem to have to make any sacrifices. Well, good for them. The rest have to work hard for their luxuries just as you and I have to. They had to make choices and sacrifices, just as you and I. Maybe they traded their time for the additional money they make – are you willing to do that? Maybe they made different ethical choices than you did that led them to where they are today – would you change your choices? Maybe they just worked harder, gave up TV, etc. – is that an option for you?

“Keeping with the Joneses” doesn’t necessarily have to be a bad thing. While the general usage of the term usually means blindly buying stuff just because someone else has it, we could redefine the meaning. We could make the Joneses our motivators. Let the Joneses with the good houses inspire us to take on DIY projects that fit within our budget to beautify our house and increase our property value. Let the Joneses with the fancy degrees and the 100K+ jobs inspire us to take classes in the local community college or other vocational training to help get a better job or a promotion. Let the Joneses with good investments inspire us to learn about investing instead of filling us up with envy and resentment. Confront your internal Joneses and you will find that they are not a bad lot after all! Turns out they are a friendly bunch eager to give you a boost with the way your life is going!

Articles about "Keeping with the Joneses" from elsewhere in the blogosphere:

• Who Are The Joneses and Why Are We Keeping Up With Them? @ The Frugal Law Student.
• Defending the Joneses @ Well-Heeled.
• Keeping up with the Joneses @ Canadian Capitalist.
• How To Get Past The "Keeping Up With The Joneses" Mentality @ The Simple Dollar
• When Status Has Too High a Price @ Free Money Finance.

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What I Have Learnt About Success

10. Perseverance plays a far bigger role than hard work or luck.



9. The road to success is filled with many, many speed bumps and pot holes. If you cant deal with them, you better stay at home.



8. Just like there are some places you cant get into without paying a cover charge, there are some types of success that cannot be had without kissing ass.



7. Success won't be handed to you just because you have a fancy degree. You need to work for it like anyone else.



6. Success breeds success. So if you successful at one thing, think quick and leverage the 15 seconds in the spotlight to launch your next big thing.



5. Reading about success will not make you successful. Dreaming about success will not make you successful either. Usually, some sort of “action” is required.



4. Sometimes success springs on you as a pleasant surprise. What you think is trivial may seem like the hardest thing for others and they may laud you for your achievements. Make the best out of such rare opportunities.



3. Nobody gives a rat’s ass about how much effort you put in. If you want respect and accolades, you need to show results.



2. The ease with which you can succeed is inversely proportional to how long the party lasts. The easier it is to get there, the sooner you will be replaced by someone else.



1. And finally, the one that triggered this tirade: Sometimes success comes too darned late. By then you have moved on to something else. It doesn’t matter that your success is far more than what you ever anticipated or that you spent several years dreaming, wishing and hoping for this kind of success. Now it is nothing more than a piece of information that results in a bitter-sweet feeling that cuts like a knife at the pit of your stomach while at the same time filling your heart with joy and pride. Deal with it, and move on!

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Culture Specific Oddities in Money Matters

The comments on yesterday's post about money and relatives brought out an interesting point - the way I looked at the issue and the way strangebird and plonkee looked at it was quite different. And I suspect that the differences were mainly rooted in the cultural background that each of us came from. While I still had this thought in my mind, I stumbled across the discussion here and here (via The Simple Dollar) about "Asian Culture and Finances". Since my background is Asian as well, and I am immensely fascinated by this issue, I thought I will jump right in. So today's post is all about the oddities of my brand of Asian culture in relation to money matters.

Disclaimer: I do not mean to generalize here. My intention is to present my personal opinion and experiences about one brand of Asian culture! Note that there are oceans of differences within these cultures as well - Korean culture is very different from Chinese which is very different from Indian and so on. Even within each major grouping things differ depending on whether you are from "North" or "South", "mainland" or "coast" etc. So, please take this with a pinch of salt! It is for information only!

• Let me start with the topic that was the focus of the discussion mentioned above. Yes, Children are expected to support the parents, financially (and otherwise), in their old age. This is very strong in my culture. It's just something that is taken for granted. The extent to which the children support the parents, however, is open for individual interpretation. In some extreme cases, commonly referred as "joint" families, the children stay with the parents under the same roof and all the finances (and most other decisions) are shared. This is almost an extinct breed these days though. I think Mai's story mentioned on the Make Love Not Debt blog (about an Asian who had to lay down $6000 to support a vacation for his parents when he was out of a job) might also be an extreme example. I think, these days in most cases (at least the ones that I have come across), the parents are very reasonable in their expectations and try to provide for themselves and do not rely on their children, at least not for full support.



• An interesting aspect of this cultural practice is that only male children are supposed to take care of the parents. Parents are not supposed to accept anything from their female offspring! I think the root of this was that in really old days, the women had no source of income, and so it would be the son-in-law that would have to actually pay. Since the guy already was responsible for his parents, he would be stressed too much if he was expected to take care of his in-laws as well. But as things evolved (or devolved) this turned into a gender-divide issue. For several years in the middle, folks with only female offspring were the recipients of public pity, since they would have no one to take care of them in their old age!



• This brings us to the next big difference I have noticed between the different cultures. In my culture *all* the expenses related to a wedding are expected to be paid by the bride's father! Also, usually the bride's parents are expected to arrange the wedding in the groom's home town. If the groom's parents are kind enough to offer to travel to the bride’s town for the wedding (since it is easier for the bride's parents to arrange a wedding there), then in many (or maybe I should say "most") cases, the bride's parents should pay for the board and food for the groom and his closest relatives for the entire duration of the marriage. Depending on the sub-culture and how orthodox the family is, a wedding may last anywhere from one day to several days. And if the bride's father cannot handle the financial burden, it falls on the shoulder of the bride's brothers. In most cases, it is the eldest son in a family that pays heavily for family obligations.



• One of the things that I realized after coming to the US is that the concept of "privacy" is almost non-existent back home. Yes, I say I realized this after coming to the US, since I just took the norm for granted without questions when I lived back in the home country. Anyway what I mean is, back at home, it is perfectly fine to discuss your salary, boast about the cost of your car, how much raise you get etc. with all the relatives and even random strangers. When I think of it, I don't think it is intentional boasting or showing off, or that people mean to degrade those that make less. It's just part of the culture to be quite open about your finances. Many people get offended if you do not want to share this information. Consequently, the openness does create a class divide and "have’s” are offered a lot more privileges than the "have-not’s”. In the US, I have noticed that the openness does exist at the highest level of the money makers - for instance everybody is interested in talking about what the celebrities make or spend - but it does not permeate into everyday lives.



• In most cases, the undergrad education is paid for by the parents, by default. So if a loan needs to be taken, then the loan is usually in the name of the parent, not the child whose education is being paid for. This is changing quite a bit though these days with children going abroad for education. With the cost being significantly higher than the local education, and the salaries that the children get after completing the education also being higher, I have noticed that these days the education loans are paid by children.



• There is a fair amount of extortion in the name of religion. I do understand that even in American culture tithing and religious charity is big, but back home it is huge, to the extent that I think it has become a form of extortion. This of course is my personal opinion and since it is a bit of a delicate subject, I will stop at that.



• Regarding smaller things, on birthday's and other occasions, it's the birthday boy/girl who pays for the dinner. I find it quite amusing, that it amuses my American (and other culture) friends when I offer to pay for the dinner on my birthday :)

Well, I think that's enough for today! I could possibly go on and on forever, but I think I have covered some of the major differences. People from my cultural background will be able to recognize immediately which background I am talking about - please feel free to add to what I have missed. People from other Asian background, feel free to point out the differences. And people from European, Middle-eastern, Aussie or African backgrounds, please do share your culture specific oddities. (I don’t have many friends from these areas and would *love* to hear from you). And of course, everyone from American culture, feel free to point out (in this post or others) when I say something offensive - it may just be a difference in culture and you might just help assimilate another immigrant into this melting pot :)

PS: When I read back this article, I felt kind of silly that most of you will likely be able to guess my cultural background quite accurately :) But what can I say? An open person + anonymous blog = some sillyness sometimes. If you choose to leave a comment (which I hope you will), please do guard my secret :)

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Money and Relatives

It’s really quite amazing how differently two sets of families can respond to a similar situation involving money. Both the better half and I were raised in families that were slightly poorer than the rest of the relatives. I don’t mean either of our families was poor. We just hovered very close to that hazy line that separates the poor from the middle class. And were surrounded by relatives that were significantly better off.

But the way our families chose to deal with the situation was quite different. My parents kept a distance between us and our rich relatives. We met them occasionally during family events such as a marriage or a death, but the interaction was strictly social. My parents taught us to laugh at our cousins when they showed off their wealth. They taught us to take pride in being superior academically. Even though, back in my home country, family is a big part of one’s life, we grew up knowing closely only one set of cousins on my mom’s side since they were the only ones at the same level as we were in terms of social status. As a result, we grew up relatively unscathed by the class divide, content in our nuclear families and independent in our pursuits.

The better half’s family on the other hand thought shunning the relatives was an admission of poverty. So they made sure they interacted with relatives on every possible occasion. They did the best they could to cover their lack of wealth and held their head high. Money was a main point of discussion and there were always some sort of comparing and contrasting going on among the adults. Children were openly told that when they grow up, they ought to aspire to be as rich as Uncle so-and-so. All the children grew up very close to each other – irrespective of how rich or poor a family they came from. As years passed by, they had developed great skills of dealing with the class divide, but not without some scars.


And now that we are older, and the two of us plan to have our own kids, we wonder how we should raise them. There will always be relatives who will remain better off than we are. Should we shield our children from them, or should we let our children develop their own shield against these differences? Also, considering that both the better half and I are fortunate to have decent jobs and are working hard on our financial literacy, it is very likely that there will be several relatives who will not be as well off as we are. How do we teach our children to behave in this situation?

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What Would You Do With Your Money If You Had Only One More Year To Live?

I stumbled across this article during the weekend about a man who was diagnosed with pancreatic cancer and was told he had only one more year to live. So he went ahead and had a blast, blowing up (or giving away) all his money. But a year went by and he did not die. During subsequent tests, the doctors found that he had non-fatal pancreatitis and not pancreatic cancer. So he was not going to die after all! Now this man is happy to be alive, but sad that he is quite broke!!! It’s an ironic story which made me wonder what I would do with my money (what little I have of it so far) if someone told me that I had only one more year to live.

• Well first off, I would go get a second opinion. And a third opinion. I have a lot of respect for doctors (my sister is one!), but all said and done, they are human, and hence, prone to errors. If two or three specialists concurred that I will die, I guess I will, right? So, onto step 2.


• Check with my insurance how much of my bills will be covered. After getting an estimate of the amount, first thing will be to set aside the money, so I don’t have to rely on others for paying my medical bills.


• Right now, month after month, some money is taken out of my paycheck for long-term disability insurance “buy-up”. According to this buy-up, with valid medical reasons, I should be able to earn 90% of my salary for the first 3 months and 75% for the next 3 months that I am on medical leave. I am sure there are clauses of coverage and hoops to jump through, but I will definitely try all the tricks in the book to stay on the payroll for as long as I can, so I can have a stream of income coming in.


• Once that is taken care of, if I am healthy enough, I will travel. To all kinds of exotic places. And meet all kinds of exotic people. Eat all kinds of exotic food. And do all kinds of exotic things, until my money runs out and I have to come back home :) Even though I have very little money to my name, it is quite diversified. There is some money in a 401K, some used to pay ahead the mortgage, some in real estate, some in stock and some in a mini-emergency fund. So, I am not quite sure which accounts I will use up. But knowing how reckless I can be, I have a feeling I will blow almost all of it, leaving just enough to fund my parents’ retirement fund.

Now, when I return home, if the doctors tell me that the initial diagnosis was wrong and I will live a normal healthy life? Well, I will go give thanks to the gods for the faulty diagnosis that led me to do the trip of a lifetime, and get back to my frugal lifestyle and start scrimping and scrounging and building up the nest egg again the way I normally do :) Seriously, I am just out of college and have only about a year or so of savings (six years, if I consider how long the better half has been working). By any measure, that is no big deal. We came to the US with very little money in my pocket, so I don’t think it will be too hard for us to start from scratch again, if we have to. We wouldn’t want to, but we could if we have to.

And no, I don’t think I would sue the doctors. Not unless it was gross negligence on their parts. Like I said my sister is a doctor and I have deep disrespect and loathing for folks that sue doctors just to make some money.

So, what would you do with your money if you were told you have only one more year to live? What would you do at the end of one year, if you find out that the diagnosis was wrong and you will live a normal healthy life after all?

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