We’re Having a Baby!

get-excited-we-are-having-a-babyThat’s right! We’re having a baby! We’re right about 10 weeks right now, so we’re just starting to let people know, and we’re freaking excited! :)

This baby has been in the plans for quite some time. In fact, we’ve been trying to get pregnant on and off for a few years now, interrupted mainly by my wife’s student teaching and a little bit of hopelessness. But we’re good now. And did I tell you we’re excited?!

It’s funny how they say that you’ll know what you’re passionate about when you think about and can relate it to every situation. After all the excitement about the whole thing came, I started churning the numbers in my head. The baby is due next February, so that means we’re going to meet our insurance deductible this year and next year. We also had to add an extra category to our budget for the time being to make sure no one needs to feel bad about splurging on pizza and french fries. And then there’s the maternity clothes, baby clothes, future diapers, and all that other fun stuff.

I also get overwhelmed sometimes by the fact that I don’t know what the heck I’m doing, and I have no idea the amount of work I just signed up for. My wife has been perpetually sick for the past month and a half, and I’m barely keeping up with cleaning the apartment and making sure she isn’t living on just ice cream.

Of course, that’s completely fine with me. I love kids. We have 13 nieces and nephews on my side of the family and all of them love me (except for the one who cries every time I look at her–we haven’t been around the family most her life so she’s definitely got some stranger danger tendencies going on). When we go visit my family in Utah, I almost always prefer hanging out with the kids than with the adults. They’re my peeps.

In my heart of hearts, I sort of kind of want a girl. I’m not sure why, I just tend to get along better with girls–and they’re cuter and less smelly/stupid than boys. Although if we end up having a boy, I’ll make sure to delete that part of the post so he doesn’t grow up with some sort of complex. Anyway, we’re both excited for this new adventure. Honestly, I have no idea what I’m going to do when the baby comes and all I’ll want to do is chill with my baby or sleep, but I guess if most parents can handle it, so can I.

Yay for baby!

(photo cred)

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3 Personal Finance Absolutes That Need to Go

personal finance absolutesThere are a lot of opinions out there in the personal finance world. I didn’t really know about how diverse they were until I started writing this blog. And let me tell you. There are a lot of C-R-A-Z-Y opinions out there. Which is cool. I’m glad I live in a country that allows people to not only have crazy opinions, but also lets them embarrass themselves with them all over the Internets. I’m sure we all do it now and then. I’ve done it a time or two (or maybe three or four…maybe). But there are certain things that have in some way or another become absolutes, meaning if you don’t follow them, you’re stupid and irresponsible.

In general, I don’t particularly love absolutes. Obviously, there are certain absolutes I do believe in, but when it comes to something like finance, most of the time they’re created because it’s really just easier to throw out general advice than it is to consider the diverse personalities and habits of the audience. With time, I’ve come to learn that there are certain personal finance absolutes that need to go away entirely. Why? Well, because they’re stupid and irresponsible.

There are certainly more than three that I believe should go, but for the sake of time and your attention, I’m only going to talk about three. Feel free to disagree with me. Maybe we can start an Internet fight and we can both walk away thinking we won (isn’t that how all Internet fights go? :)).

Credit Cards

Here’s one of my biggest beefs with Dave Ramsey, who blasts anyone who would even consider owning a credit card. The fact is, there is such thing as responsible credit card use. We’ve earned thousands of dollars off of credit card rewards without paying a single dime on interest or late fees. It takes following a strict budget and keeping yourself in check, but it can work. You can make it work.

Now obviously, there are people out there who would tend to spend more money if they had a credit card. And Dave’s advice for them is spot on. But a credit card is nothing but a financial product. If you want nothing to do with them, that’s your decision. But there needs to be more focus on the behaviors that lead to uncontrollable spending rather than blaming the products people use to do it.

Owning a Home

Americans are obsessed with home ownership, and it’s ridiculously unhealthy. And it doesn’t help that our government does its darndest to enable it, especially since the housing market crashed. Tax deductions, subsidies, and relaxed mortgage lending regulations for low-income people all point to the idea that owning a home is somehow part of the American Dream.

I’ve been asked more than a few times when my wife and I are going to buy a house. I was actually pretty focused on it as the end goal when we were living in Arkansas. But there are a few reasons why we decided against it, but the main thing is home ownership is a long-term investment. Most people lock themselves into a 30-year mortgage. But the average number of years people actually stay in a home is only 9 years.

So basically if you buy a $200,000 home today at a 4.5% interest rate, you’ve only paid $35,000 to the principal with another $74,000 going to interest. As investments go, depending on where you live and what the economic situation of the time is, you might sell the home for a gain–or you might not. And of course, that’s also not adding in property tax, homeowner’s insurance, private mortgage insurance, repairs, and all that other fun stuff.

People are also moving around a lot more than they used to. I know a handful of people who have been stuck paying two mortgages or stuck in a home too small for their family because they can’t sell it.

So remember, home ownership isn’t always an outward sign of financial success. In fact, nowadays it’s often a sign of sheer stupidity. That being said, if people want to make stupid decisions, that’s their right.

Term Insurance or Die

See what I did there? :) Life insurance is a morbid topic. And sad. When I sold the stuff, some wives would even start crying right there. It was awkward. But here’s the thing. Most people will tell you that term life insurance is the only way to go. ever. And if you buy anything else, you’re a cottonheaded ninnymuggins.

The fact is, there are situations where whole life insurance is actually a good product to have in your arsenal. While we don’t have enough money yet to convert some of our term insurance to whole life, it’s definitely in our future plans. But that’s the thing. You get these wacko money-grubbing insurance agents who will do anything to get you to buy whole life because it gets them a bigger commission. So I get the turn off there. Trust me, I do.

But when I sold insurance, I met a ton of people who had great experiences with it and used it as just another tool in their overall portfolio. Does that mean it’s for everyone? No. And am I going to call you a cottonheaded ninnymuggins if you don’t want it for yourself? Maybe, but just for funsies. No really, it’s OK to go either way. Just don’t do it blindly or without a necessary research. AKA don’t be a moron.

Don’t Be a Jerk

In the end, it’s cool if you have differing opinions on what works best for you financially. We’re all different and there are thousands of different ways we can manage our finances. But don’t for one second think that you’re so special that you get to be the one person who decides how everyone should do it. We call those type of people dictators. Or jerks, if it makes you feel better about yourself.

If you think credit cards are bad, that’s cool. But don’t be self-righteous about it (the same goes the other way too). If you see someone buying a house before they should, don’t talk smack behind their back. That’s their decision, and they’ll probably pay for it later. And rather than spending all our time debating products, let’s focus more on behaviors, because that’s really where the seed of financial independence lies.

(photo cred)

Are there other personal finance absolutes that you think are ridiculous? Do you think I’m ridiculous? Do you like pizza?

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The American Dream: Not What Most Americans Think It Is

american dreamAccording to a recent “expert analysis” done by USA Today, the American Dream carries a price tag of $130,000 a year. I’m not going to go full-snark mode into the details of each of the listed expenses because I think my friend Holly at Club Thrifty did a great job at it, but one of the expenses listed in the analysis that I just can’t get over is $12,659 for groceries.

Listen, I’m a Mormon. I grew up in Utah. My dad has 11 siblings. I can fathom high grocery costs. But with an average household size of 2.59 people in the US, what in heaven’s name are these people buying at the grocery store? Sadly, that’s just one of the many ridiculous “necessary” expenses if you want to be living the American Dream.

Anyway, what is the American Dream? Sometime last year I posted that question on my wall. Of course, I got a few schmuck responses:

  • “Living in Europe”
  • “Not living under the tyranny of Obama and Reid,”
  • “Universal healthcare and wealth redistribution.”

I also unintentionally started a fiery Internet argument (which are always so pleasant) about entitlements, people with disabilities, and all that fun political stuff (enhances the unpleasantness). But then I got some thoughtful responses that weren’t overly stupid or political:

  • “Working hard resulting in prosperity. The opportunity to earn a comfortable life.”
  • “Having the opportunity to live your life freely, to give yourself and your family any kind of life you want to have.”
  • “Working hard for the things you want.”
  • “Equality in opportunity not outcome. Everyone having the change to pursue the life they want to become what they want so long as it does not take away the freedom of others.”

The Real American Dream

The biggest thing I got out of those responses was that the American Dream is all about opportunity, not money or things. I also found the original definition of the American Dream by the guy who first coined it, James Truslow Adams:

That dream of a land in which life should be better and richer and fuller for everyone, with opportunity for each according to ability or achievement. It is a difficult dream for the European upper classes to interpret adequately, and too many of us ourselves have grown weary and mistrustful of it. It is not a dream of motor cars and high wages merely, but a dream of social order in which each man and each woman shall be able to attain to the fullest stature of which they are innately capable, and be recognized by others for what they are, regardless of the fortuitous circumstances of birth or position.

I don’t know about you, but that’s the American Dream I believe in, and I find it ridiculously insulting to attach a price tag to it. Since when is material wealth the one thing Americans care about so much that we label it our dream?

There are other parts of what have become the American Dream that drive me nuts as well. For example, buying a home. People want it so badly that they’ll jump into debt up to their eyeballs for it. And it’s not just the idea of buying a house. All of the sudden, we have to have the biggest house we can possibly “afford”. Honestly, from what I’ve experienced living in Europe, there’s no shame living in an apartment or renting a house. In fact, there are quite a few benefits to it.

And the list goes on and on. Why do we do this to ourselves? Does any of it really even matter? Why can’t we just go back to the original American Dream. You know, the one where 7 out of 8 Americans haven’t failed to achieve it (which is the number if you believe USA Today).

Let it Empower You

Personally, I don’t ever remember a time in my life where I haven’t lived the American Dream. Even back when I was an unemployed college graduate, living with my in-laws, and watching my wife go to work every day while I applied to as many jobs as possible. That episode of my life lasted 6 months. It doesn’t seem like a long time, but when you’re in the thick of it, it’s torture. No, I wasn’t happy about it. But I still had an opportunity to better my situation. I just had to take it, so I decided to start this blog. And here, less than a year later, I earn about as much from my freelance writing as I do my regular job.

You see, the American Dream is supposed to empower us as people. How many of you feel empowered by reading that article from USA Today? 1 out of every 8 of you, probably. But how many of you feel empowered when you recognize that you live in a country where there is always a way to better yourself, to live a life of achievements that can never be taken away, and to even live a more full and wealthy life by helping others reach that goal as well?

That’s the American Dream that makes me proud of where I’m from. It makes me feel empowered to know that with hard work, I can make my life into what I want it to be.

Of course, we’re not perfect. There are people who are still at a significant disadvantage because of the system that’s in place. But things have gotten better and things will continue to get better as long as we fight for the true American Dream. That shallow one isn’t going to get us anywhere, so forget about it. Let’s focus more on the opportunities and less on the results. Because honestly, who cares about the results as long as you’re genuinely happy?

What are your thoughts about the American Dream? Should there be a price tag? Or is USA Today a bunch of money-hungry yuppies?

(photo cred)

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