True story: On a cold, dark winter night in the early 90s, I left Omaha with three of my bachelor buddies on a ski trip to Colorado. Our plan was to leave town when Tom finished his night shift at UPS. We would take turns driving all night and end up at the ski resort just in time for the lifts to open.
I drove the first leg of the journey, arriving in the I-80 enclave of Lexington, NE at around 3 a.m. My Ford Escort needed gas and I needed sleep. Tom would be taking the wheel for the next few hours. As I approached the counter of the 24-7 Sinclair station to pay for the petro, he proceeded straight to the adjacent self-serve soda fountain to fill up a 44 oz Mountain Dew.
“There’s enough caffeine in this cup to get me all the way to Denver,” Tom would assure us a short while later.
Tom was a little OCD about the ice to soda ratio in his cup. At first he dispensed a little too much ice, so he dumped some out. Due to the weight of the ice and laws of physics, he inadvertently poured out more ice than he wished. So he dispensed a little more into the container.
At about this time I was handing the cash to the clerk who, bless his heart, was clearly disabled with some sort of spinal disorder to the extent that he was bent over the cash register like the Hunchback of Notre Dame.
As the clerk prepared to count out my change, he hurled this threat a Tom: “If you keep wasting that ice, I’m going to make you pay for it.”
I kept my eyes on the man, wondering what may have caused his condition. From my periphery Tom retorted, “Don’t get all bent out of shape, man! It’s just ice.”
I couldn’t take it. The audio and visual, combined with my sleep-deprived state and demented sense of humor was too much to bear. Rather than hang around for the change, I darted out the door to the car where I would remain buckled over in uncontrollable laughter until Tom returned. The commotion had briefly woken the other two who stayed in the car. Given my condition of oxygen constricting laughter, it took a good five minutes for me to explain them all what had just happened.
Tom had not even looked at the clerk on his way to the ice machine, so he was unaware of the man’s disability. He put no thought into his reply. Once I made it clear to him what he had said, his eyes and mouth widen simulteously as if to say, “Oh, no I didn’t!”
Yes he did. And it has been a source of laughter ever since.
About this time last year, when I was living in Colorado, I proclaimed to my Facebook friends, “One of these years I’m going to go to Phoenix for a couple weeks and attend as many MLB spring games as I can. Just not this year.”
At the time I had never been to the Phoenix area and we had not yet discussed moving here. (Another post for another time.) That was also before I realized just how much baseball action takes place in Arizona. Every spring thousands of people flock to the Phoenix area for to catch glimpses of their favorite players up close during Major League Baseball Spring Training. It turns out Spring Training is just the tip of the proverbial iceberg.
In the past five years or so, I have become a fan of the complete game – the players, the stats, the rules (written and unwritten), the coaches, the umps, the fans, the reporters, the stadiums. I love it all – minus paid parking. I study in the off-season by reading biographies, magazines and geeky books like “Watching Baseball Smarter.”
So this year I’m committed to taking in as much baseball in person as I can. Back in January I mapped out what the spring would look like on a calendar. I started with the MLB Spring Training calendar – six or more games per day from the end of February through March. On top of those games, I overlaid the World Baseball Classic, then Arizona State and University of Arizona games, plus a baseball experience like no other.
Vintage Base Ball Tournament at Warren Field in Bisbee, AZ. Photo courtesy of Friends of Warren Ballpark.
Would you believe the oldest active baseball stadium in the U.S. is also in Arizona? Yes, even older than Boston’s Fenway Park. Had to book a family trip to Bisbee in April. We’ll catch one day of the Copper City Classic Vintage “Base Ball” tournament on Saturday. They play by 1860 rules in old school uniforms and the umps wear beanies and bow ties.
On our way home Sunday, we’ll stop in Tucson to watch the defending national champion (2012) Arizona Wildcats play the Cal Bears – a 2011 College World Series team – in another classic ballpark: Hi Corbett.
I took in my first Spring Training game with my teenage daughter this past Sunday. It was windy and cold and she wanted to leave early. I coaxed and coddled her to stay through six innings. Day two of my 2013 baseball binge is today: day one of the four-day round robin Coca Cola Classic Tournament in Surprise featuring ASU, Arkansas, Gonzaga and Pacific.
As if plotting out all the baseball games going on isn’t challenge enough, I need to work in my full-time job and my part-time role as taxi driver for the kiddos, plus their sporting and school events and the occasional family meal.
I’m not sure how I’ll handle all this baseball but I’m going to give it a try.
Welcome to the new age of deception: Lip-syncing has gone mainstream.
Remember the big stir Milli Vanilli created when they were busted for lip syncing in a live concert in 1989? The band was sued for consumer fraud and suffered, rightly so in my opinion, an immediate end to their success when fans realized they had been duped.
So why do we allow today’s stars to get away with it?
Most recently, Beyonce was outed by the Marine band for lip syncing the national anthem at Obama’s inauguration. The national anthem! Is this what show business has come to: Deceiving fans and spectators at in order to deliver a “perfect” show?
If the productions were perfect, it might be tolerable. However, I’m aware of two recent accounts of lip syncing that were far from perfect.
In October 2012 my wife took our teenage daughter to the opening night of Justin Bieber’s tour in Phoenix. Not fifteen minutes into his act, Bieber threw up while “singing” one of his songs. My wife texted me the details live. She reported that the show continued even though he threw up twice more with no interruption in the music (or his singing) at all.
Justin ‘the Biebs” Bieber tosses his cookies in his 2012 concert in Glendale, AZ as a recording of his voice continues to play. Photo credit: usmagazine.com
Intrigued to see what this was all about, I searched YouTube later that night and sure enough, smart phone videos taken by a number of people in attendance revealed that a recording of the Biebs rolled on as he tossed his cookies.
Another botched lip-sync performance occurred at the 2013 Fiesta Bowl football game I attended. As we fans were asked to remove our caps for the singing of the national anthem, the jumbotron camera zoomed in on 2012 London Games high jump silver medalist Brigetta Barrett who appeared to be psyching herself up for the performance she was about to lay down.
Before the crowd quieted down, her lovely voice began to deliver those beautiful lyrics we Americans love. The only trouble is that her lips weren’t moving yet. My guess is the AV producer had one espresso shot too many in the preceding hours and pushed the button prematurely. Once he (or she) realized the error, the pause button was pushed – at just the second the Barrett’s lips began to move.
Eventually they got it together and she finished her part of the show, but not before the damage was done. What a fiasco! I’m sure she’s a great athlete. She may even be a good singer, but she lost the faith of anyone that was paying attention that night.
Modern technology has made it possible for us to be fooled in just about every aspect of life. Think about all the models who are Photoshopped for their appearances on the covers of glam magazines. How about the Manti Te’o girlfriend scam?
Sadly, it seems that most Americans are okay with being duped by technology. I for one am fed up with it. In my opinion, if you want the fame and rewards that go along with being an entertainer, you had better be able to entertain.
Screw it up and you might find yourself featured in my blog.
Dream with me for a minute. Imagine that you woke up this morning and realized that the quick pick numbers on the Powerball ticket you bought at the convenient store the other day matched all six balls in last night’s drawing.
Lump sum or annuity?
Among the many important decisions you’ll have to make is weather you want a lump sum or series of payments over twenty years. If you were to choose the series of payments, you’re opting for what we call in the financial planning world an annuity.
Suppose you win the Powerball lottery. You’ll need to decide whether you want the jackpot as a lump sum or series of payments – or an annuity.
Now you know what an annuity is in it’s simplest form. Unfortunately, the insurance industry has added so many bells and whistles to annuity products that they’re far from simple.
When I used to teach my financial consultant trainees about annuities, I always found it helped them understand the concept better if we put them into categories. Most annuity products can be categorized as either a fixed annuity or variable annuity and again as immediate or deferred.
Fixed or variable
A fixed annuity means that it accrues interest at a minimum guaranteed rate. The interest paid is generated by underlying investments in bonds or other securities that pay interest and the eventual return of principal. Since annuities are also insurance products, fixed annuities are typically guaranteed to pay a minimum rate plus additional earnings (or dividends) on top of the guaranteed amount.
On the other hand, a variable annuity offers no guaranteed rate. Instead, the return generated by a variable annuity depends on the performance of underlying investments – usually publicly traded stocks and other non-interest bearing securities. Variable annuities can even lose principal in the event of a drop in the stock market.
Immediate or deferred
Most annuities can also be classified as either immediate or deferred, a reference to when the payments (to you) begin. As the name implies, an immediate annuity will begin payments right away. That could be in a month, a quarter or even a year from the contract date, depending on when you request your first payment. Deferred annuities often don’t begin to pay out for several years. During that time, you can typically increase the size of the annuity principal by contributing more premiums to it.
To summarize, you could have a fixed annuity that’s immediate or deferred. Likewise, a variable annuity can be either immediate or deferred.
The connection to Powerball
Okay, so how does this lesson about annuities tie in with Powerball? Remember, if you ever win the Powerball lottery one of the most important decisions you’ll have to make is whether you want to receive your winnings as a lump sum or annuity – a series of payments.
You don’t need me to tell you that your chances of getting hit by lightning in this life are better than matching all six Powerball numbers. However, anyone can purchase an annuity contract. If you have a sizable lump sum from insurance proceeds, the sale of property or a business or what have you, you can convert that money into a series of payments with an immediate annuity. In many cases you can even roll all, or a portion of, your retirement account into an annuity. (Be sure to educate yourself on potential tax consequences if you consider this move.)
Suppose you don’t have a large sum of money. You can purchase a deferred annuity with a smaller sum of money and add to it over the years to build up your own annuity “jackpot.”
The Washington Post headline for January 1, 2012 read “Senate overwhelmingly passes ‘fiscal cliff’ deal.” This after President Obama cut short his Christmas vacation with the family in Hawaii to fly back to Washington negotiate a deal with Speaker Boehner.
Image credit: Fox2now.com – St. Louis, MO
With all the talk recently about the fiscal cliff and how President Obama’s plan would surely send the U.S. into a double-dip recession (the first dip having occurred 2008-09), I got to wondering about how my own tax situation had been impacted by the decisions of Washington in recent years.
It’s hard to know what the truth is with all the sound bites we hear in the news, so I did what made the most sense to me and looked back at the tax returns I have filed jointly with my wife for the past several years.
Our effective tax rates for 2004 through 2011
Year Rate Pres Senate control
2004 6.68% Bush Republicans
2005 5.43% Bush Republicans
2006 9.37% Bush Republicans
2007 8.02% Bush Republicans
2008 6.46% Bush Democrats
2009 6.46% Obama Democrats
2010 7.46% Obama Democrats
2011 8.45% Obama Democrats
I was a little surprised by what I found. Our highest effective tax rate (9.37%) was in 2006. I did a little more digging found that the Republican Party not only occupied the Whitehouse (George W. Bush) but also controlled the Senate at that time.
During this time period our gross income increased by 16%. Neither my wife nor I changed employers or moved. Our dependent (children) count remained constant too.
The takeaway for me is that Republicans aren’t as true to their claims of being the tax reduction party as they would like the American public to believe. During the Bushpresidency, our effective tax rate rose nearly 3% from 2004 to 2006 before it began to drop in 2008 in response to all of the stimuli designed to head off a recession. (Note: we went into a recession anyway.)
During the Obama years, our tax rate increased from Bush’s last year in office; however, as of our 2011 tax return we’re still not back to the peak rate of 9.37% tax rate we were paying in 2006 under Bush and a Republican controlled Senate.
Don’t take my word for it. Look up your own tax returns and see what the impact has been for you.
Here we are in a new year again. If you are a resolution maker and want to do a better job at managing your finances, consider one or more of the resolutions below.
1. Make a budget (or spending plan)
Budget – it’s a scary word, I know. Almost as bad as the word “diet.” If you don’t like the word budget, try calling it a spending plan. Whatever you call it, without putting more thought into what you spend, you are more likely to spend money recklessly.
Keep it simple. You don’t need any fancy software or apps; a simple spreadsheet is what I use. Plot out what income you expect to receive on a monthly basis and how much you expect to spend.
I have found that predicting expenses is a lot easier if you download transaction history from your bank or credit union for recent months or the same month a year ago. Although it takes a little more work, I like to plot out every day of the month so I can project how my account balance will likely change from day to day. This is a good way to help prevent unnecessary transfer and overdraft fees.
2. Spend less
Sounds painful, but this is actually the one of the easiest things to do. A simple way to find ways to save is to look at your bank statements. What always stands out to me are purchases like coffee or fast food places. You don’t need to give them up completely, but you can cut back on the number of times you go there or on what you buy. Try this: small-size rather than super-size. Or bring your lunch to work one more day per week. Taking these little steps can add up to big savings.
Top financial resolutions people make according to creditcards.com.
3. Pay down debt
This one is a real challenge and offers perhaps the greatest feeling of satisfaction. My wife and I paid off three loans that had been weighing us down in 2012 and we aim to get rid of our last two in 2013. Take if from me, there is no better feeling than calling to ask for the payoff amount for a loan then telling the service rep, “Thank you – now help me make my final payment and close this account for good.”
Opinions differ among experts as to which debts should be paid down first. We’ve been following the debt snowball method made famous by Dave Ramsey. You pay off your smallest loan first by getting aggressive with extra payments. As soon as that debt is gone, add the minimum payment that you would have been paying on that loan to the payment you’re required to make on your next biggest loan until it’s paid off. Repeat that sequence until your debts are paid off.
With interest rates as low as they are currently, now is also a good time to see if you can renegotiate lower rates with your lenders. Be careful about consolidating debt. By bundling all your debt into one large loan, it’s possible to become overwhelmed and feel like you’re getting nowhere.
4. Save more
Don’t confuse this with spending less. What I mean by saving more is actually putting money away for you to use later on. The best way to get and stay motivated on this goal is to think of it as paying yourself. Ideally, you should be the one you pay first always. Anyone just starting out in the working world should make this a high priority. However, it can be really tough to do if you haven’t gotten serious about spending less or paying off some debt.
5. Get in touch with your investments
When friends or family members ask me for advice with their investments, I’m always amazed to find out how little they know about what they currently have. How much do you have? Where is your money invested? What sort of return are you getting? If you can’t answer those basic questions, getting answers should be a high priority.
Once you have a better idea of what you have and how it’s invested, do some digging to find out if it’s appropriate for your goals. Learn about investing in stocks, bonds and mutual funds and get intentional about how your money is invested. You can only work so many hours per week to earn money for yourself. If you’re investing wisely, your portfolio can become like a silent partner for you – earning money for you even on your day off. Trust me, if you ever plan to retire you cannot grow your investment portfolio too large.
Don’t have investments? Make it a goal. It’s easier than ever to invest your money and have it go to work for you. The most convenient way to get started investing is with your retirement plan at work. If you don’t have access to one, look into setting up an IRA (individual retirement account) or mutual fund account.
6. Educate yourself
Learning more about what you currently have is an important step, but don’t stop there. Learn about the stock market and what impact the decisions made by the numbskulls in Washington have on the market. Find a few blogs or websites to follow, starting with mine. I learned a lot about financial matters in college and my formal training but the real valuable lessons I learned by reaching, watching and doing. Expanding your knowledge about finances is a responsibility you owe to yourself.
In December 2012 I called my credit union to ask about consolidating a loan we have elsewhere with a loan I already have at the credit union. The solution they offered surprised me: A cash out auto loan, whereby I send them the title for the truck I recently paid off and they loan me up to the blue book value at a very low interest rate.
Image property of autopawnamerica.com
Making a move like this is counter to the general advice offered by Dave Ramsey, whose wisdom my wife and I have been relying on in our pursuit of financial peace by eliminating all our debt. What I would tell Dave is that I’m not taking on more debt; I’m just changing the interest rate and to whom I’m repaying the loan. Besides, by having the loan with my credit union I can be “gazelle intense” in paying it off since I’m reminded of the debt every time I sign in to online banking and I can make extra payments with a couple mouse clicks. Truthfully, this is my real intent.
At first I was uncomfortable with giving my truck title back to the credit union since I had never heard of a loan like this. I wondered how it’s any different than an auto pawn business. In retrospect, it’s probably no different; however, the interest rate is much better than I could get with a pawn broker and I do have a lot more trust in my credit union.
Why is it that we always think the worst? “If I miss a payment, they can repossess my truck,” that voice in my head told me.
“You haven’t missed a payment on any loan for over ten years dummy; your truck won’t be repossessed,” the glass half-full voice responded.
I followed the voice of reason. As a result, I was able to borrow the same amount of money I owed on my other loan but at a much lower interest rate. The other loan was 18% interest and would have taken me another four years to pay off. The rate on my new loan is only 2.5%. The monthly payment is about five dollars more per month and if I make only the minimum payments each month, the loan will be paid off a year earlier. However, my wife and I are committed is to making double payments and paying the loan off completely by the end of 2013.
Provided we continue to be blessed with steady income and no big unforeseen expenses, I’ll have the title for my truck back in a year and we’ll be that much closer to our goal of being debt-free. Works for me!
When I bought my daughter a new phone at Verizon recently, I was asked if I wanted insurance on the phone. The insurance would offer a replacement phone in the event it was damaged beyond repair.
As I began to do the quick math in my head, that little voice of reason that I’ve been hearing from a lot more lately promptly gave me three reasons to say no.
Image courtesy of insuranceinfonews.com
1. Monthly Cost
The upfront cost for the insurance is $7 per month, or $84 a year. If the need arises, we can likely replace the phone with a used model from an Ebay seller for under $100. So unless she destroys the phone in the first two months, the insurance math just doesn’t add up.
2. Deductible
In addition to the monthly premium, if we need to use the insurance, there is a $100 deductible to get a new phone.
3. Obsolescence
The model of your phone will likely be obsolete by the time you need to use the insurance. Earlier this summer my daughter’s other phone gave out. Verizon didn’t have a “comparable replacement” so we ended up buying the exact model on eBay for about $60. We took it in to get the contacts transferred over and she was back in business.
There was a time when we felt it was worthwhile to pay for insurance cell phones. That was when the whole cell phone craze began and we had this fear of forking out a bunch of money just to maintain the ability to use our service. Now that cell phones are plentiful and we have been using them for a long time with no issues, I just can’t justify the cost of insuring them.
If you have you been thinking about trying to post something for sale on craiglist.com but have been hesitant because you don’t know how to go about it, read on.
In 2012 I sold no less than two dozen items using Craigslist. To date, I have a 100% success rate. I also have a bachelors degree in advertising, but my advice here comes more from my actual experience using Craigslist.
Craigslist is a free website you can use to sell items around your house.
1) Write to an audience of one Knowing and writing to your audience is key to success for any ad. Since you likely only have one item for each ad, you don’t need the type of door buster ad that we see around Thanksgiving. In most cases your target audience is just one person out of a hundred or so that will see your ad. What does that one person need to know about the item you’re selling?
2) Keep it simple Use simple language. Keep your sentences short; a bullet pointed list is more effective than sentences. Tell as much as you can in the title: brand, color, model, year, etc. This helps people find your ad when they perform a search.
3) List the price In the world of Craigslist, price is a big motivator. Unless you’re selling something so unique that it can’t be found elsewhere, your ad will likely flop if you don’t offer the item(s) at a bargain price. If you don’t tell them your price, potential buyers are more likely to skip on to the next seller’s ad. Based on my experience, Craigslist buyers aren’t as likely to haggle as garage sale or old-school classified ad shoppers. So you don’t need to price it higher than you really want to sell it for in order to give yourself wiggle room.
Tip: my 100% success rate with Craigslist ads is due in part to my willingness to drop my price (if necessary) over a number of weeks until the item was attractive enough to a buyer.
4) Post pictures Many Craigslist shoppers won’t even open your ad if they don’t see the image icon next to your title. Craigslist now allows you to upload as many as six pictures per post. Use that to your advantage by showing the item(s) from many different angles. Since the first image you upload is the one that shoppers will see first, make sure it’s the most representative picture. Don’t hide the flaws though. Showing imperfections up front will make the transaction go much smoother when the buyer shows up at your house with the cash.
5) Give your phone number This is critical. Craigslist buyers tend to be spontaneous. They feel like they need to strike quickly in order to get a good deal and won’t take the time to send and manage a number of emails. Be prepared to delete your ad as soon as it sells so you can eliminate unnecessary calls or text messages.
Tip: It’s best if you give a cell phone number and mention that they can call or text you. This works better for you too, because you can answer or respond to calls if you’re away from home.
Follow the five tips above and you’ll be selling your stuff on Craigslist with the best of ’em in no time. It’s a great way to turn unwanted items around your house into cash.
For examples of what not to do when you write a Craigslist ad, see these OMG Craiglist ads (intended to be humorous).
Paul Fiarkoski 