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Financially Ready To Have Kids?

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baby Financially Ready To Have Kids?

CNN Money asked its readers to give their answers to a question one reader submitted:

When is a person financially ready to have kids?

My husband and I make decent money, but it all seems to go to student loans and the mortgage. How does anyone decide the time is “right” to have children? What steps should we take before starting our family to make sure we are financially secure enough to provide a safe and happy home for our children?

This is one of those questions that have no right answer, because it’s so different for everyone. But I believe it’s a useful question to ask, even if you don’t know the right answer. I know that a baby is a great deal of responsibility and costs a great deal of money. According to a USDA report, it now costs an average middle-income American family $222,360  to raise a child from birth to 18. That’s almost a quarter of million dollars! Furthermore, that number DOESN’T include college costs, which could range from a few thousand dollars a year at community colleges to $50,000 a year for a private university education.

I’ve read a lot of personal finance posts that say something along these lines: kids don’t have to cost all that much money! All they need is love and attention! They just want time with you! I don’t disagree with that, because it’s true, kids don’t really care if they wear Target or Tommy Hilfinger (just wait until they become teenagers!). But having kids also impose some very real costs - impact on your career (and thus income) trajectory, impact on your personal freedom, impact on your relationships. Achieving a certain level of financial security can mitigate some of these impacts – having enough money to pay for a night nurse so that the new mom can get enough sleep after the delivery, having enough money to hire babysitters so the mom & dad can go on a romantic date, having enough money so you don’t worry (too) much about health insurance or paying for school supplies.

So money isn’t everything when it comes to children, but not having money also causes a lot of problems for new parents and puts further strain on a marriage. CB is probably a little less enthusiastic about kids than I am… and I am about a 5 on a scale of 1 – 10, 1 being Childfree Forever! and 10 being Must Have Baby NOW! One of his reasons for CB’s reluctance  that he is very worried about the impact a baby would have on our finances and our freedom. Which are legitimate concerns that I share. I take this to mean.. we are definitely not ready now.

We might be ready one day, however. I am finding babies cuter and cuter, much more so than I have in my early 20s. I see a pretty biracial toddler with straight black bangs and a bowl haircut, and I start wondering… well, maybe it wouldn’t be so bad to have one of those. Perhaps the biological imperative cannot be denied. If so, here is what I’d like to have accomplished financially before CB and I bring a baby into this world.

  • Save up an adequate retirement fund. I am not sure what “adequate” means just yet… but $250,000 sounds like a good number.
  • Achieve an income and a level in our careers that would allow us to continue to save for retirement, give the kid a leg-up, provide childcare, and buy a modicum of balance.
  • Live in the same city. This may seem like a no-brainer, but given that we will likely move to different states a month after the wedding, I’d like to ensure that we will not be in a long-distance relationship WITH a kid.
  • Pay off our student loans because baring a mortgage, I really would like to be debt-free by the time we have a kid.

On the one hand, I can chalk these goals up to my Type A personality and my desire to really, truly, prepare financially before we are responsible for another human being. On the other hand, setting these very high financial goals may just be a way for us to delay becoming parents without shutting the door on parenthood. I don’t know what is the “right” level of financial security before you have a child. Obviously, people have become parents under less-than-ideal circumstances and still have raised great children. And obviously there are very wealthy parents who are horrible parents. But most of the time, parents are just trying to do the best they can with the resources they’ve got. The truth is, I am not confident in my ability to be a good mother, but I’d like to have as many ducks in a row as I can to mitigate that uncertainty. Having more resources have to be better than having fewer, right?

When do you think you would be financially ready to have kids?

“I Deserve It”

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i deserve it I Deserve ItHow many times have you made a purchase because you thought, “I deserve it“? If you have, speak up… so I know I’m not the only one!

Lately, I have noticed that I slip into this pattern far more often that is productive. It’s good to “treat” myself if I can afford it, and it’s fine to reward myself for a job well done, but “I deserve it” shouldn’t be an excuse to spend, spend, and spend. Unfortuantely, somehow, I have gotten into the habit of using “I deserve it” as a crutch, and excuse, to spend above what is prudent. I had a hard week at work, so “I deserve it.” I worked extra hours to earn some freelance income, so “I deserve it.” I saw that great deal to the spa that I’ve been waiting for, so “I deserve it.”

All those “I deserves” are standing in the way of what we truly deserve.

Instead of a beach vacation that we’d have to finance with a credit card, we deserve to greet our monthly bills with zen, because we know that we can pay off what we have purchased.

Instead of a leather bag (or, um, shoes) whose price tag sails above our budget, we deserve to have the peace of mind that comes with a 3-month, 6-month, or even 12-month emergency fund.

Instead of the newest flatscreen TVs or flashiest DSLR camera, we deserve to look at our online statements and see we are saving 10%, 20%, maybe even 30% for retirement.

Instead of a sleek new car that we can only afford with a 6-year purchase plan, we deserve to start upon the road to financial security by making smart choices today… even if we have to drive down that road in a very old car.

Today is Valentine’s Day, a time to celebrate love (it’s NOT a made-up holiday, says this Valentine’s Day defender). And what better way to show love to ourselves -especially our future selves- than to work toward what we truly deserve? I’m using this holiday as a wake-up call… and a chance to reframe my concept of what I “deserve.”

Tell me about your “I deserve it” traps.

The Money Sandwich

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money sandwich The Money Sandwich

Last night, CB and I were driving. R&B and rap songs were playing on the radio, and suddenly CB said, “you know what, we can build a sandwich with all the slang terms we have for money.”

Case in point:

First, you have to start with slices of bread (made from dough)… refers to basic sustenance, livelihood, to earn one’s daily bread, breadwinner

Then we add some cheddar… refers to selling foodstamps (“government cheese”) for money or the similarity in size between stacks of cheddar cheese and bills

Next, we slide in a few leaves of lettuce – refers to the green color of bills

And finally, what better meat to put into a sandwich than… BACON? bacon – as in bring home

Viola! The money sandwich. icon smile The Money Sandwich

What other terms for money can you think of? Can you build anything else with money slang?

Do No Spend Challenges Work?

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no spend challenge wallet Do No Spend Challenges Work?Many personal finance bloggers participate in “no spend challenges” or count their “no spend days” as a way to rein in the budget and save more money. I once tried a version of a no-spend challenge / shopping hiatus (it was called C.A.S.H. and focused exclusively on clothes, shoes, and accessories) back in 2008, but gave up after 4 months. I have never tried a completely cold-turkey no-spend challenge. Lately, though, I’ve been feeling a little disillusioned and discouraged with the long road to financial freedom, and as I look around my apartment at the hundreds of dollars worth of items that are unused – or, gasp – never used, I’m wondering if I should give this no spend challenge a try.

Will it turn me into a better saver? A more thoughtful consumer? Or will is it a stop-gap measure that will just drive the shopper in me crazy and won’t lead to any lasting change?

So, of course, I made a pro / con list as I think about embarking on a NO SPEND CHALLENGE…

Pros:
It challenges you to, well, NOT spend.
It’s kind of a game – how many days can I go without using money?
It forces you to look at other, potentially less appetizing options, aside from just whipping out a credit card (for example, I may actually be forced to eat the wilted head of lettuce and old bread in my fridge instead of going out for Chipotle. Less appetizing, indeed!).
It makes you become more conscious of often you go without buying something.
It discourages thoughtless, throwaway purchases such as a pack of gum or popcorn.
It encourages planning-ahead-spending.

Cons:
It can encourage “binge buying” behavior. If I just rush out after a no-spend challenge and buy $500 worth of merchandise, that really is no better than spending $10 a day for two months.
It’s unsustainable.
It forces you to pass up really great deals that can save you money over what you would have normally spent.
It doesn’t necessarily help people become more conscientious consumers.

From what I can see, it doesn’t really hurt to try a no spend challenge. Maybe that’s what I need to kick my personal finance butt into gear.

What do you think of no spend challenges? Do they work for you?

Is Being a Grown-Up Everything You Thought It’d Be?

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adulthood Is Being a Grown Up Everything You Thought Itd Be?

When I was young, all I wanted to do was to grow up. I remember one of my fervent wishes were to be able to stay up past my bedtime, 9:30pm. I loved New Year’s Eve because it was one day of the year when my parents wouldn’t chide me to go to bed sooner. Then a few years passed – I’m not exactly sure when – and they stopped telling me to go to bed. And I missed that, not because I wanted to be told, but because it was a sign that time is passing, and that I am getting older, and once you get to a certain age, you lose the privilege, the expectation, that you should go to bed at 9:30pm.

Now I am a bonafid grown-up, an adult, I am getting married and heading off to graduate school and saving for retirement and all that. There are lots of things that I enjoy about being an adult. But there are other things that make me go, “gee, being a grown-up isn’t all that it’s cracked out to be!”

  1. All the Administrative Life Tasks that you have to deal with. Picking up the dry-cleaning. Buying groceries. Setting smog check appointments. Renewing your driver’s license. Paying the electric bill. All these little annoying things that take up much more time that I had expected.
  2. A mature, healthy relationship that takes work, and most of us did not grow up taking Relationship 101. I don’t know what I was thinking when I was young, but I had the impression that having a happy relationship would just kind of materialize, because that’s what happens When You Grow Up. But relationship, like all things, actually takes work. Who knew? For as important as healthy romantic relationships are in a person’s happiness, there is suprisingly little education on it.
  3. It’s hard to make, and maintain, friendships. Unlike in high school or college, where you see your friends every day and maybe even lived in the same building, being an adult means that your friends are miles away, or spread out across the country, or even the world. In a school environment, it’s relatively easy to make friends. But once you are out in the working world, and everyone is busy, and maybe have their own, primary, relationship, it becomes much harder to make friends.
  4. The cooking. Oh… the cooking. Being an adult = if you want to eat you have to cook or pay someone else to cook it for you. Being a child = having someone provide your meals WITHOUT charging you money. How glorious that was. Now, CB and I descend upon a pot of Mom’s leftover fried rice like ravenous wolves.
  5. Having to think about money & retirement. I never worried about retirement until I found the world of personal finance. But now I do!

Fess Up Friday

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I got a traffic ticket that has yet to be paid. It’s due next month.

Taxes. They are not going to get done until March.

Even though I know they are an interest-free loan to the government, I love receiving tax refunds.

If I can go back to middle school, I’d tell my younger self that life will get better.

I look around my apartment and I see at least $300 worth of purchases that I have never used before.

Now it’s your turn to fess up. What are your confessions for this Friday?

The Big 2-7

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Today is my birthday. Which means that I have officially entered my “late-twenties.” To celebrate, we are going out to the local Cheesecake Factory where I will feast on one of my favorite desserts of all time (although that list is about 50 items long…): strawberry shortcake with fresh strawberries.

When I was in middle school, I read the novel Tuck Everlasting and first learned of the concept of immortality via magical spring water, I thought that 27 would be the perfect age to live forever. See, to a 12-year-old, 27 seems older to be respectable, but still young enough to be… young. But of course now I know that the only way to avoid growing old is dying young. (Also, no such magical spring exists).

I just took another look at my 30 by 30 goals lists I started 2+ years ago and realized time is-a-wastin’! I haven’t quite accomplished too many of those items on my list, but I am in the process to accomplishing a few. I am looking forward to my 27th year – this is the year I am going to get married to CB and have a wonderful honeymoon in Buenos Aires, (hopefully) get into a great business school, study Chinese in an immersion program, max out my Roth IRA for the 6th year, and gain a few more ounces of wisdom. In my 27th year, I am going to make a real push to fulfill some of these life goals on my 30 before 30 list as well financial goals that all good personal finance bloggers have.

But for now… as birthday present, would you take a look at this article I wrote Allstate’s blog and tweet or FB it? icon smile The Big 2 7 Life insurance hasn’t been on top of my mind, and I imagine that’s the case for many folks in their 20s and 30s. But getting married that makes me realize that soon I (and my income-generating ability) are going to be important to more than just myself.

5 Reasons Why Young People Need Insurance

Do We Need a Prenup? 7 Questions You Should Ask Yourself

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Do we need a prenup?

Kevin at Thousandaire would say yes! (and in video form, too). Before I actually got engaged, I was a big proponent of prenuptial agreements. Throughout my childhood and teens, I’ve witnessed some rather unhappy marriages (fortunately, not my parents’). So I was quite hung-ho on getting a prenup and defining the financial terms if my marriage were to end. Well, now I am engaged to the man I’ve known for 10+ years, a supporter, a friend, a confidant, a partner. We are getting married in 8 months. Drafting an enforceable prenuptial agreement in California will cost thousands of dollars even for just-starting-out folks like us. Suddenly the issue is less theoretical and more practical. I still think that a prenup is important for many people with more assets, but we aren’t rich. In fact, we are going to be broke grad school students pretty soon. So, is a prenup for us?

7 questions to ask when you ask yourself “Do we need a prenup?”:

  • What does your state law say (and do you agree with it)? In 41 states, assets are split via “equitable distribution.” In 9 community property states (California included), everything acquired during the marriage is automatically split 50/50 if the marriage ends.
  • Do you have substantial assets or expect to come into substantial assets in the future? Bottom line, I don’t think we’re rich enough for a prenup. No millions in the bank, no ownership in businesses, no stock options at hot startups. Our career salary trajectories are roughly similar, and while I make more money now, either one of us has the potential to out-earn the other in the future.
  • Do you agree with splitting assets acquired during marriage 50/50 if you split up? Both of us agree that all assets we acquire during the course of the marriage – outside of inheritance – should be split 50/50 if we were to get divorced. I am more likely to receive an inheritance in the future. If I were to receive an inheritance, however, it would likely be structured in a trust and so would remain separate, not community, property. A prenup can reaffirm that separation, but it’s not critical.
  • Do you have similar levels of debt? We are coming in with roughly equal amounts of student loans.
  • Do you have children? Is this your second or third marriage? This doesn’t apply to us, but I’ve read that a prenup is exceedingly helpful for protecting the interests of children in a remarriage.
  • Do you want to have provisions where assets distributions are used to punish infidelity? If you want to make sure that your spouse’s share goes from 50% to 10% (or 0%), if he/she cheats, then a prenup is necessary. Cheating is so prevalent nowadays that courts don’t really look upon that as a consideration in terms of determining asset splits. Be sure to define what constitutes infidelity and what level of evidence is necessary. That must be a fun conversation.
  • Do you plan to have one person stay at home with the kids? Do you want to figure out the terms of alimony? Some people say that if one person leaves the workforce to take care of kids at home, it’s best not to have a prenup or to have a prenup that says assets will be split 50/50 (to protect the interest of the stay-at-home parent).

Our decision

The bottom line for us is, for the duration of the marriage -which is hopefully forever- we see whatever money we make as “our” money, no matter if he makes more or I make more. Furthermore, I cannot imagine CB behaving in an dishonorable manner.  I’d like to think I would never behave that way either. I love him for his humor, his good looks, his kindness and quirks. But almost above all I love him for his character – he would have to become a whole different person for him to become bitter and spiteful. (Though of course, the nature of divorce means that people have changed, and often into someone unrecognizable to the other).

So, I don’t think we are going to get a prenup. Given all of the above considerations, I’d probably take the money we would have spent on a prenup and spend it on a big vacation instead! I hope our marriages lasts and lasts until one of us is called to the Big Gathering Place In The Sky. But baring that, I trust that we will both try our hardest to remain civil and amicable even if we were to separate. I believe we will be good partners to each other, and if we fail at that, I believe we can be good ex-spouses. It’s probably not a terribly romantic way of arriving at what is the “more-romantic” decision to not have a prenup, but it works for us.

Would you sign a prenup? I’d love to hear from anyone who has gotten a prenup or who has considered one, especially if you don’t have millions in the bank!

Would You Sell Family Gold Jewelry for Cash?

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The price of gold has grown by leaps and bounds over the past couple of years. In fact, this precious metal is sitting pretty at $1,800 per ounce right now, compared to $1,000 per ounce two years ago and $1,400 per ounce six months ago.

Many folks with old gold jewelry have already cashed out their cache of necklaces, bracelets, and rings. The ever-higher prices are sure to tempt those who haven’t.

My grandmother gave me some pieces before she fell ill – a gold bangle, a few old coins, a chain. She grew up in a wealthy family and these jewels were part of a much larger dowry. During a civil war in her home country, she dumped loads of precious gems into the rivers so that her family wouldn’t be lynched by the mobs. Sometimes, I imagine what treasures must lie at the bottoms of these rivers, covered with decades of mud and silt. These few gold and silver items were all that my ancestors managed to save, all at enormous personal risk.

I am not normally sentimental about jewelry, and her jewelry certainly aren’t really my taste (nor do I have use for such nice pieces). The rational thing to do would be to take advantage of the historic run-up in gold prices, send in the bangle and chain for cash, and then maybe use the money for graduate school. Somehow the rational thing feels like the wrong thing to do. I don’t need the money desperately, and I like the fact that I have something that is a piece of my family’s history. It makes me sad to think of the jewelry, so carefully protected and hidden, melted down. So, for now, I am holding on to everything.

Would you sell, or have you sold, gold jewelry for cash?

Wedding Planning – Expenses So Far

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After finally settling on a wedding date in June 2012 and deciding on a small wedding with a guest list of 30 or so, I started signing contracts and putting down deposits. Here are the costs so far:

Ceremony site: $240.

We are getting married in a public building. Because all the venue has incredible architectural details and built-in seating, we don’t need any decorations or chair rentals. In fact, we might even get some of this money back if we leave the site in good condition. I have wanted to get married at this place even before I got engaged, and may have even looked up how much it would cost.

Photography (50% deposit): $425.

I actually found my photographer via an ad I posted on Craigslist. We loved her portfolio, had a great Skype meeting with her, and booked her for 4 hours. She recently started doing wedding photography full-time and has a beautiful blend of photojournalistic and portrait pictures. This lady is going jump out of our price range very soon, if she hasn’t already. I know it can be hit or miss finding someone on Craigslist, but I wouldn’t have booked her if I didn’t do my due diligence, so I am hopeful that things go well.

Wedding dress: $66 including tax!

While I was wandering around a Nordstrom Rack 10 minutes before closing, I spied a long column of ivory lace. It was a completely spur of the moment purchase, but when I tried it on at home, I saw that it fits really well. It satisfies all of my criteria: it’s lace, it’s budget-friendly (all right, downright cheap!), and, if I may say so myself, it’s quite flattering. This material is also light weight, which was important to me because I want to be able to navigate easily from my seat to the cake table. icon smile Wedding Planning Expenses So Far

Restaurant reception deposit: $500.

This fee is applicable towards the price of food and drinks at the reception. It’s a quaint French place, and normally those places aren’t exactly to CB’s taste, but he really liked the meal we had here so we booked as well. I was won over when I saw coq au vin on the menu.

Running total: $1,231

Now that all the important vendors and sites have been secured, and I have a rough budget in mind (under $6,000), I am feeling so much better about this whole process. I can tell that we’ve underestimated certain items – $1,200 for food and drinks won’t cut it, but we are saving on other things so I hope it will all balance out. Sometimes, I find my attention drifting towards what type of flowers I’d like have to what cakes we are going to bring for the dessert table. So, I suppose, wedding planning can be (kind of) fun.

Jury Duty: Does It Cost Too Much?

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What is something we are obligated to do but that almost everyone dreads? Some of you might say taxes, but I say - jury duty.

In my BlogHer post on the Financial Impact of Jury Service, I crunched numbers for two hypothetical scenarios – a self-employed contractor and a stay-at-home mom. Even with a relatively short 5-day trail, the cost of jury service can quickly escalate into the hundreds or thousands.

I understand it is a civic obligation. I understand it is essential to our justice system. I understand that it’s a great opportunity to see how our justice system works – from the inside. But the financial impact of jury duty – coupled with its uncertainty (i.e. you never know at the beginning of a trial exactly how long a trial will last) – really puts a damper on most people’s desire to serve.

For many small business owners or self-employed folks, jury duty means they are up the proverbial creek without a paddle. The Fair Labor Standards Act (FLSA) does not require employers to pay employees their regular compensation during jury service. Even if your company pays for jury duty, you may still have to go after hours to complete your work (a gentleman I met in line at the courthouse informed me that at his last trial, he had to serve during the day and then head to his office after 5pm to catch up on all the work he had). Or, you may have to use vacation days / paid time off if you want to be paid your salary during service.

Check it out and let me know what you think. Would better compensation and/or tax breaks make you more willing to serve on a jury?

Are We Forgetting Our Unemployed?

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In the best of times, it’s tough being unemployed. Today, unemployment is long, discouraging, and financially devastating experience for many Americans. As I read the newspaper and hear talking heads discuss the jobs market and the economy at large, though, I am struck by the fact that most of the conversations glides over the 9.1% unemployment rate; the plight of the individual seem to be missing from the national discourse.

It’s as if… most of the us has moved on. The ones who kept their jobs or found jobs after the 2008-2009 period are busy working, and the ones who didn’t watched the number of their remaining unemployment checks dwindle. To add insult to injury, unemployed folks are not considered an influential voting bloc, so politicians don’t have an incentive to even count the them as an important constituent.

Are we forgetting the unemployed Americans? The unemployment rate dropped to a still sky-high 9.1%, partly because many folks have simply given up hope of finding a job in a dismal market. In fact, the percentage of Americans who are working is the lowest in almost 30 years – only 45% of people over 16 are had a job in 2010. The 99 weeks of unemployment insurance has run out for a lot of people, leaving them to get burn through their savings, cash out retirement funds, move in with family members, or taking early Social Security payments.

Now, unlike in 2008 and 2009, the massive layouts seem to have ended (knock on wood). I remember that several of my friends were laid off in those years. One girl I knew was out of a job for 18 months. I remember the frustration and self-doubt after I went on interview after interview without an offer. Fortunately, though, my friends and I found jobs again.

But what about those people who didn’t find jobs? The longer you are unemployed, the more difficult it is regain employment. Many recruiters and HR managers prefer currently working or recently-employed candidates. Workers lose skills, confidence, and contacts the longer they have been out of the market. If you are older than 55, the cards are even more stacked against you.

I don’t know what the exact prescription is, but I think we need to do more to help our unemployed folks, especially the long-term unemployed.

Thoughts? Do you think the unemployed has been neglected?

Personal Finance on the Backburner

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For the past few weeks, I’ve put personal finances on the backburner. I don’t check my accounts as frequently, I forgot to pay one of my bills (oops!), and I just happened to stop by an outlet one day and stepped out $50 poorer – but one stylish maxi dress, 3 ramekins, and 1 cake pan richer.

To make up for this lackluster feeling, I did schedule a $300 contribution to my 2011 Roth IRA. I suppose that’s a start. I also picked up a new wallet for my dad, and per CB’s instructions, will put in a one dollar bill when I give Dad the present. Apparently, it is bad luck to gift someone an empty wallet.

To snap myself out of this, for the lack of a better word, funk, I have decided to apply to a volunteer position at a local free clinic. I’m also planning on looking for a few classes to audit, or embark on some self-study courses. Since I have been out of college, I feel that my study abilities have gone steadily down hill. Even though I am obviously using critical and analytical thinking at work, I miss that feeling of being in class and really delving into a subject.

Wait until I’m in grad school… then I shall look at this post and laugh.

Question

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A few weeks ago, when I was hanging out at a Starbucks a man came in. He had a big duffel bag and a suitcase, and has obviously been out on the street for a while. I asked him if he would like something to drink and eat, and he said yes, in a surprised tone. He said he’d like Venti Pike coffee and an apple fritter. It cost me $4.50. He asked for the receipt so he can keep track of the time.

He was nice and articulate and thanked me kindly for helping him out.

A few days ago CB and I saw him again, sitting on a bench. He wasn’t panhandling, wasn’t calling attention to himself. I thought about buying him something at Starbucks again, but figured he’d appreciate cash the most. So I just kind of slipped by him and said it was nice to see him again and handed him the $15 I had in my wallet. This person reminded me of another homeless gentleman I’ve seen before, a few years ago, in a completely different part of town. I never did make an overture to that man or tried to help him, and I’ve always felt a little bad about it.

Back to now… I did something nice, you could say. But did I do him a favor by buying him the drink and the snack, or did he do me a favor by letting me assuage my guilt with an almost inconsequential sum? I had a home to go back to, he doesn’t. Why?

 

401K Maxed Out!

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My biggest financial news for June is that I’ve hit $16,500 in contributions to the 401K.  I am happy that I’ve done so, but for the most part I don’t really feel much difference in my net pay. Once I maxed out the 401K, I zeroed out my W-4 deductions and set up automatic deposits from my checking account to my Roth IRA. Basically, I need to keep as little money as I need to live on in my actual checking account.

To celebrate, I did pick up a few pieces of clothing from a sample sale site. Most of the time, though, I’ve been feeling a little like Hi That’s My Bike. So many questions right now – about life, career, purpose, meaning, how do I get from point A to point B if I am not really sure what point B is and how do I enjoy the journey between point A and point B if I am so worried on figuring out what point B should be. I suspect there is no magic answer rabbit that I can pull out of the proverbial hat. Unfortunately.

Wedding planning, even for 20 people, is getting a wee bit annoying. I suppose I care more than I thought but not so much to really put so much money and effort into it. All of this translates to: we don’t even have a date. Eloping is look so tempting right now.

It’s times like these when I so wish I can just strap on a pair of tango shoes and hit the dance floor. But I’ve been battling an ankle injury for over six months now, and while I am healing it’s still very frustrating that it’s not 100%. So no tango for a while, which adds to my malaise.

Back to the 401K. It’s great. But it’s no answer for the Question That Is Life.

“Investment Clothing”: Investments That Aren’t

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When is an “investment” not an investment?

When it comes to “investment clothing” or “investment pieces.”

According to dictionary.com, the first definition of “investment” is:

the investing of money or capital in order to gain profitable returns, as interest, income, or appreciation in value.

Despite what fashion magazines say, clothing is not an investment

The fashion world love touting the idea of “investment” clothes or an “investment” wardrobe. Every season, editors rave about new “investment pieces” or “statement looks.” Want some Louboutins? They are an investment in your shoe collection! How about an Armani suit? An investment in looking professional! An Hermes purse? An investment accessory!

Don’t get me wrong, I agree that we should have classic, high-quality pieces that will last us through at least three or five years – cheap rayon shirts and skirts do not a wardrobe make. I agree that we should buy what we love, instead of what’s on sale. I agree that having well-fitted and appropriate clothing is absolutely essential to many careers. There is nothing wrong with buying beautiful clothes (I love clothes and would probably spend far more money on them if I could!), but it’s wrong to call shopping an investment.

Most of the time the idea of an “investment piece” is used to convince us to buy really, really, expensive items that have no prospect of appreciating in value. A Bottega Veneta handbag is absolutely stunning, but I think it’s going a wee bit far to call it an investment. There are a few luxury brands that hold their value well (Chanel, Hermes come to mind), but they are the exception rather than the rule.

Like most ladies I know, I admire well-constructed jackets, supple leather purses, stylish little black dress. I may even buy an expensive piece that goes perfectly with everything else in my wardrobe. I may even buy an expensive dress that I plan to keep for the next ten years. All that is great, but that doesn’t mean I’ve made an investment.

I feel like a curmudgeon, because who doesn’t like beautiful clothes that fit and flatter? But as personal finance expert Manisha Thakor says, clothing is not an investment!

Coupled Up = Money in the Bank

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Are there financial benefits to being in a relationship?

swan couple 300x193 Coupled Up = Money in the BankGlobe and Mail recently came out with an article about the true cost of being a singleton. (By the way, I just recently discovered Globe and Mail. I love it!). It seems a little unfair to me how the world is structured for couples, but I will take my breaks where ever I can get them.

I do think there is a slight distinction in between in a relationship and living together vs. being in a relationship and living apart. Most of the benefits accrued to coupled people are because they live together, in fact, as anyone in a long-distance relationship will tell you, being in love and apart can get expensive, fast.

Since CB and I started living together, here are the few ways that our relationship has saved me money.

Living expenses

In the few years since I graduated college, I have gone through several living arrangements. I’ve lived with a roommate, lived by myself, and now am sharing an apartment with a significant other. Living with CB means that we can split the groceries, DSL, utilities, and rent. I am paying about $300 less than I would be if I were to live alone. The biggest benefit I see to cohabitation is the fact that two married / partnered people can live in a studio or one-bedroom apartment, an arrangement that wouldn’t be possible with roommates. A one-bedroom apartment is quite a bit cheaper than a two-bedroom. There’s also the sharing of resources that occurs: two people living together don’t need two separate internet connections or Netflix accounts or cable subscriptions.

We made the decision to live together because it made sense for our relationship (I think most people would agree that moving in solely for financial reasons isn’t the best idea), but it’s a big perk that living together is so good for our budgets.

Travel

One of the best things about coupling up, I think, is that you will always have a good travel buddy. Given how busy everyone is, I have a hard enough time scheduling dinners with my friends. It’d be 1000x more difficult to plan a big, expensive trip that matches everyone’s tastes and schedules (I am still a little sad that our girls’ cruise 2009 never happened). I can travel alone, but I’m the kind of person where I’d have much more fun and I’d feel safer if I am going with someone else. Plus, if I go on a big trip by myself, it would be very, very expensive.

The dreaded single supplement is alive and well. Most travel prices are quoted with double occupancy, which means that if I were to go alone, my best choices are to hope for a good roommate or to fork over the extra dough for a private room. The Galapagos cruise we are saving up for, for example, costs around $4,000-$5,000 per person. A single supplement would add another $1,000 to the total price.

Food

I actually am not sure if I am saving money in this regard, but if I cook more, I can buy in bulk. It doesn’t cost double the price to cook for two people than it does for one. I will admit that being in a relationship has prompted me to eat out more though – there’s always a willing dining buddy in CB!

Personal Care & Grooming

A few months ago I wrote about a lady who spends $10,000+ a year on dating and related purchases. So I don’t have that pressure of looking fabulous every single minute of every day – which I take advantage of, liberally (sorry CB!). Still, I’m pretty sure that my personal care and grooming expenses are what they would be if I were single. Most of the “beautifying” things I do (facials, pretty dresses, lipstick) are for myself – because, well, I want to look good! And this might not be politic to admit, but I hope CB never thinks I’ve “let myself go,” so I try to do what I can to look moderately attractive for us both. At least a few days a week!

But I don’t spend $10K on dating activities when I’m coupled, and I don’t foresee increasing my “dating budget” much even if I were single (although, to be honest, I would probably spring for an online dating membership).

Gifts

This is an area where being in a relationship definitely costs couples more. Birthdays, Valentine’s Day, anniversaries, etc., all these holidays and “milestone” occasions add up, also, don’t forget the “just because” gifts that can add to the relationship goodwill. But, in the case of giving gifts to a 3rd party, I suppose couples have the opportunity to go dutch on a gift, effectively splitting the cost in half.

Do you think it’s cheaper being a couple than being single? Any other costs or perks that I’ve overlooked?

Photo credit: Miss Claeson via Flickr

20 Ideas for a Cheaper Night Out

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Today’s guest post is by “Wojo” Kulicki, author of the personal finance blog Fiscal Fizzle. Thanks Wojo!

A lot of young people love to go out—whether it’s clubbing, bar-hopping, eating out, or a wide variety of other expensive entertainment options. Some people can still afford it, but more and more are finding that their income is having a hard time keeping up with their lifestyle.

I’m finding that many of us are willing to get very creative when put “under the gun” of a strict budget, debt repayment plan, or a cut income. Things that were needs suddenly become wants and get shoved to the side. Nevertheless, entertainment is still something we want to engage in, so what’s a 20-something to do?

Here is a list of 20 alternatives to going out—some I’ve tried personally, some suggested by friends and colleagues, and some learned by observation. If you’re finding it increasingly hard to entertain yourself by spending a night out on the town, maybe it’s time to give one of these a whirl:

Dance lessons.

If you’re like my wife, you love going out because dancing is fun. But she’s also perfectly content spending the night at a dance lessons improving her moves!

Board game night.

A staple of low-budget get-togethers, the right board or group game can really make the night last into the morning. My favorite? Catch Phrase.

Music session.

Do you sing? Got a buddy that plays piano? You’ve got yourself a night full of awesome music. </li>

Sports league.

While the bars and clubs are starting to fill on a Friday night, there are softball, soccer, and tennis tournaments going on right in your town!

Go to free community events.

At least once a week, there’s a free concert going on in the community park down the street. On the first Saturday of the month, there’s also a free movie night.

Tasting.

For many, one of the major appeals of going out is the alcohol. Why not attend a wine tasting instead, or better yet—have your friends bring over the wildest samplings they can and share!

Be in the vicinity.

Some people just love the buzz and atmosphere of nightlife. Head downtown and people-watch or walk the strip.

Be a designated driver.

If you just can’t pass up going out, but can live without the drinking, why not offer to drive everyone around?

Grab ice cream.

If going out to eat is your thing, but dinner’s too expensive, head to the creamery for some dessert instead.

Find a group activity.

Inexpensive get-togethers at the mini-golf course or the bowling alley could mean hours of fun that are light on your wallet.

Find an art event.

Organized art exhibits or downtown “art walks” can be great places to enjoy a nightlife atmosphere and maybe even score some free drinks.

Go to the movies.

Sure, it’s still spending money, but even a $10 movie is still competitive with most other night-out ideas.

Do a late night picnic.

When I think of picnics, a late afternoon at the park or the beach comes to mind, but a friend suggested that picnics late at night are an awesome way to pass the time.

Hold a bonfire/camp-out.

Those of you blessed with a country setting and a sizable back yard will have no problem pitching some tents to hang out in or setting up some lawn chairs around a campfire.

Organize a potluck.

Have friends who love food? Pick a house where you can crash and have everyone bring an awesome dish they’ve made.

Hold a Wii tournament.

Interactive games have changed the idea of game night forever. Now you can get everyone involved and moving.

Set up an outdoor movie.

If you have a projector, laptop, speakers and a large white sheet, you can create a DIY theater in about 10 minutes.

Head to the pool or the beach.

Water can be more exciting at night, especially with a few drinks and good company.

Hit the arcade.

Yes, they still exist! Once a staple of teenage life, arcades are a fun way to kick back, get nostalgic, and enjoy some simple fun.

Go cruising.

When I lived in Miami, we could spend an entire Friday night just driving down South Beach without ever getting out of our car.

Are you excited yet? A lack of money doesn’t have to mean a lack of fun! The list above is only a start—as you can see, there are tons of free or low-cost things you can do tonight instead of sulking about not having money at home. (Well Heeled Blog: or, for something fun and productive, how about enlisting your significant other in some spring decor to make your home cleaner and more stylish?)

What’s your favorite? What options have you tried that aren’t on the list?