Category Archives: Lifestyle

10 Years in a Life

Bronx River
10 years ago today, I turned 27 years old. I was working full time while attending law school part time. It was my fourth and final year of school and I was getting a little nervous. I would have about $90,000 of student loan debt, which included some loans from my undergrad, when all was said and done. Fortunately, I did have some money saved in retirement accounts and savings account since I had been working and saving. That amount, however, was dwarfed by the student loan debt. Life was a little stressful, but life was also very good. I was going out with a girl who would soon be my wife. I was preparing to go on a Rotary Group Study Exchange to Mexico for a month, while also preparing for the Bar Exam.

10 years before 10 years ago, I turned 17 years old. I had just gotten my learners permit and was hoping to learn to drive. Exciting times! I was in my junior year of high school and preparing to take my SATs soon. I was browsing through college catalogs wondering what school I’d end up going to. I wasn’t sure what I was going to study but the world was my oyster. I was optimistic about my future and thought that I had all the potential in the world. I also worked on the weekends and had some spending money. I dutifully saved some of that in savings accounts that my parents had opened for me. I had my eye on the future. Although my definition of future was my college years. I was looking forward to leaving high school and going to college.

And 10 years before that, I turned 7 years old. That was thirty years go and my memory is kind of foggy as to what was going on in my life. Luckily, I was frugal even back then, eschewing toys and saving my money and stickers for the future. I was 7 years old. Everything was possible. I could be President of the United States, but my dream was really to be the starting point guard of the New York Knicks. I dreamed of building a futuristic car since Knight Rider was one of my favorite shows and even made notes about what features it would have. I could have been a young Elon Musk!

Today, I have been working as an attorney for almost 10 years for the same employer. I work in the public sector so the pay isn’t the greatest but I do have really good benefits and the hours aren’t too bad. My wife and I have been married for about nine years and we have two wonderful boys ages 3 1/2 and 9 months. I have paid off over half of my student loans but there’s still a chunk left to pay. They are all ultra low interest rates so I’m not in a rush to pay them off, but I’ll try to throw some extra money at it when I can. Life is good, but pretty hectic with two little ones.

10 Years from now, I don’t know where I’ll be or what I’ll be doing. I don’t have a crystal ball to tell the future. I hope to have reached financial freedom by that point, but I don’t know if I will, being that I don’t plan on leaving this high cost of living city called New York City. If I am still working, I’ll probably be with the same employer. The benefits and pension are golden handcuffs! My kids will be entering the teen/pre-teen years…that might be a rough phase! I don’t foresee being in the co-op that we bought as we will probably have outgrown it. What neighborhood will we move to? Will we opt to rent versus buy? I don’t know.

A decade. 10 years. 120 months. 3650 days. You can do a lot in that time span. It is a long enough time to accomplish pretty much any of your goals if you put your mind to it. If you are in debt, it is plenty of time to get out of the red and into the black. It is enough time to reach financial independence, according to the Groovies. Ten years is a long time, but 10 years goes by in a blink of an eye. Time flies. If you want to accomplish your goals, whatever they may be, you need to start now to work towards it. Where do you want to be in 10 years? What are you doing today to get there?

How Much Have You Spent On Buying Cars?

I was never a car enthusiast like many of my friends, but I’d be lying if I said that I never cared about what car I drove and that a car is just a tool to get from point A to point B. Back in the Fall of 2000, I was very fortunate that my parents offered to help me purchase my first car when I was in my junior year of college. I checked out a couple of used car lots and set my eye on a burgundy 1997 Acura Integra. It was listed at $8500, which was a little above budget, but I was hoping I could negotiate the price down. When I told my dad about the car, he said that he wasn’t going to help me buy that car. He said that the repairs would be expensive with an Acura and also, he didn’t want me to have the “need for speed” driving a sporty little car.

512px-3rd-Acura-Integra-sedan

So instead of the 1997 Acura Integra, I got a 1997 Nissan Altima. The Altima had about 55,000 miles on it when it was bought used in 2000. I drove the Altima in college and continued driving it after I started working while many of my friends purchased nicer cars. Once when I visited an old college friend who I hadn’t seen awhile, he was shocked to see that I was still driving the same car, 8 years after graduating. I was a little envious of my friends with nicer cars, but I was going to law school part-time in the evenings and working full-time during the days. I was not earning all that much while racking up a lot of student loan debt. Using all my savings to buy a car or racking up more debt to buy a nicer car wasn’t a priority for me. I think I might have kept the car a little bit longer, but repair issues started popping up. It also left me stranded a week before my wedding, so I wasn’t too sure about it’s reliability. When I finally traded it in after driving it for 10 years, it had about 168,000 miles on it.

Not my car but looks just like it.

Not my car but looks just like it.

In 2010, I purchased a used 2009 Hyundai Sonata with 38,000 miles on it for $13,300. I paid cash for this car and the salesman said, “it must be nice to have that much in cash!” I felt a little awkward and told him I took a loan from my 401k even though I didn’t. Then he started lecturing me about how taking a loan from your 401k was a bad financial move!

As part of a promotion at Enterprise Car Sales where I purchased the car, they gave me $500 on top of the KBB value of my trade-in, so I got $1000. I purchased the Sonata because it had the latest safety features which was important because my wife and I were planning on starting a family. Hyundais had also gone a long way in reliability but prices were still pretty affordable because it wasn’t a brand that many car buyers coveted. By this time, I had turned 30 and was a personal finance reading addict. I no longer cared about using my car as a status symbol.

Car

I drove my Sonata for a little over 6 years and replaced it in late 2016. Unfortunately, I have a long commute to work and had about 190,000 miles on it by the time I bought another car. The car was a road warrior and had been good to me. It was reliable and I probably could have kept it for a little while longer, but since I had two kids and often transport another adult or two in addition to my wife, I wanted a bigger vehicle. At this point in my life, I was definitely not defined by the car I was driving. Even with all the ridicule that I heard relating to dads driving minivans, I bought one and am happy with its practicality.

I bought a used 2015 Toyota Sienna in the Fall of 2016 for $18,500 from Hertz Car Sales. They gave me $500 for my Sonata. I plan on driving my Sienna until the wheels fall off, or actually until I feel it is reliable and won’t leave me and my family stranded on the road. I financed this car purchase as the interest rate was relatively low and I’d rather use my cash to invest, however I plan on making extra payments to it and paying it off quickly.

Sienna

So adding all three cars up, including the Altima even though I didn’t pay for it, the total amount spent for the purchase of these vehicles is $39,400. I could also subtract the $1500 that I received on the trade-ins, but that doesn’t really change the number all that much. So it’s just a shade under $40,000 for about 17 years and counting of driving, which I would like to think is a reasonable number since I know many who spend that much on just one vehicle purchase. However, this number might be high for many people who live in NYC since they can cut out cars completely as public transportation is easily accessible for most and there are Zip Cars as well as ride-sharing options available to others.

To see what cars other bloggers drive, check out The Cars of Personal Finance Bloggers at Mustachian Post.

Another interesting one is the Car Timeline on Money Watch 101, which is what inspired me to post my own car timeline.

How much have you spent purchasing your car(s)? Do you buy new or used cars? Do you think of your car as a status symbol?

Personal Finance for the Forgotten

credit: freedigitalphotos by Winnond

credit: freedigitalphotos by Winnond

Tomorrow, after a divisive and contentious election, a new president will be sworn in. A thin-skinned, vengeful, inexperienced braggadocio and bully. That was just an undeniable assessment of the character of the man based solely on his conduct, actions, and words. This is not a political blog nor am I a very political person so I’m going to leave it at that.

Xenophobia and racism played a part in the outcome. Having an opponent who was strongly disliked with flaws of her own also played a role. Some just held their nose and voted for the least of two poor candidates. Others voted for a third-party candidate who had no chance of winning. However, there was a strong segment of the population who felt ignored by the political establishment, on both sides. Their economic concerns and values were not addressed and Mr. Trump was able to tap into that anger and turn it into a victory for himself. The forgotten man and woman are angry for being ignored, and rightfully so.

Sometimes I wonder if there is a segment of the population who feel like they are the forgotten when it comes to receiving personal finance information. In a Yahoo finance article listing various ways to spend less and save more, it offered the usual generic tips most personal finance bloggers often tout. One reader commented, “Each time I read about educational and personal finance tips here, I can’t avoid feeling that they were written by privileged folks with textbooks solutions to real life problems.” I’ve also read comments in similar articles where people seem to shake their head and say, “I already do this, but I am still struggling!”

The feeling that perhaps personal finance bloggers or gurus are perhaps out of touch with reality made me think of a Saturday Night Live skit where Kristen Wiig parodies Suze Orman. Josh Brolin plays Dick Dunkendirk, a caller to the Suze Orman show who is in dire economic straits. He tells Orman that he “took a sponge bath this morning in a TJ Maxx bathroom” and slept on “four opened pizza boxes lined with Pampers.” Orman responds by telling him to tap into his emergency savings account and to immediately put his money into a Roth IRA.

Helaine Olen, a journalist and writer, criticizes personal finance gurus for blaming financial victims for not getting ahead when it is a political and economic problem. She says that “there is this great myth out there that Americans went on a financial bender. The leading cause of bankruptcy is not buying lattes, it’s health care, followed by the usual fractured families, unemployment, sort of all of the plagues of the 21st century — economic plagues.” She continues by saying that it “depends on if you think this is a self-help problem or a political problem. I believe it is a political and economic problem.” She also says that those in the personal finance space are basically saying, “‘Yeah, the economy (is poor), but you’re in it on your own, and therefore you should be able to solve this on your own.’ Realistically, that’s just not true for most people.”

I think Mrs. Olen’s comments are troubling. She is correct that a lot of those financial struggles are a result of the economy and that a large part of it is a political problem. But by saying that personal finance advice is unrealistic and unhelpful is a disservice to her readers. Actually, not only is it a disservice, it is unproductive and perhaps dangerous. She is allowing the forgotten and ignored to abdicate responsibility and play the victim. Yes, for some of those struggling, they may be blameless and perhaps they may be unable to pull themselves out of poverty. But you can only control what you can control. Sure, it would be great if our politicians could offer a solution, but I’m not holding my breath on that happening. It is much more productive to try and find a solution on your own, rather than waiting for a savior. Nobody cares more about you and yourself. Your choices in life has a huge effect on your destiny. So rather than accept financial struggle as a foregone conclusion, take action to improve your lot in life. Even with all the issues we have in this country, I still think this is the land of opportunity.

If you are unemployed or underemployed, you’ve got to learn skills which will enable you to get a better paying job. If you live in a depressed area with no jobs, maybe you will have to move. I do not mean to make it seem like these solutions are easy. They are absolutely not easy. However, what choice do you have if you are stuck in that predicament. And while Mrs. Olen has done much more research and has more access to data than I do, my anecdotal experience is that while there are many struggling due to things beyond their control, many are also struggling because they lack financial literacy and live beyond their means. I see all too often that a family is living paycheck to paycheck, yet they have cable television, an expensive car, more house than they need, and the latest tech gadgets. However, I would also like to caution many who rush to judge others financial predicament without knowing the full story. Often times when I read an article about someone struggling financially and the comments will lay complete blame on that person for their actions. More empathy, compassion, and understanding can never hurt.

As I was writing about the forgotten people out there struggling financially, I read that Jay from Budgets are Sexy has created the Rockstar Community Fund where $20 gift cards are given out to better someone’s life. Another initiative is Debt Drop where $50 is given to someone struggling with debt to give them a little hope for the day and remind them that they are not alone. This initiative was inspired by Melanie Lockert of Dear Debt who was doing that on her own blog. Finally, a third initiative is a general fund, which has recently helped a fellow blogger who is struggling with health issues. Some may say that $20 or $50 is a drop in the bucket, but big things often have small beginnings!

I’d also like to mention that Brian from Debt Discipline has spoken at his local library about dealing with debt and about budgeting. He has also championed financial literacy education at his children’s high school.

I am inspired by my fellow bloggers who are taking action to address the needs of the forgotten. What else can we do? What else can those struggling financially do?

Am I a Christmas Grinch?

christmas-gifts
Growing up to immigrant parents who worked about 12 hours a day, 6 days a week, we didn’t partake in all the Christmas and Santa traditions that many of my peers followed. We had a Christmas tree up, decorations around the house and we got gifts. We would get a gift from our parents and gifts from some relatives. I think the gift count stood at like four or five gifts. This was amazing! Four or five gifts all on one day is A LOT! Isn’t it?

I’ve been hearing some parents say that they’re trying to LIMIT themselves to ONLY buying four gifts, not including some smaller gifts as stocking stuffers. This is on top of the piles of gifts that the grandparents, relatives and friends will be buying the kids. I wonder where do all these toys go because I’m sure the kids receive plenty of toys on their birthday as well as toys they might receive throughout the year.

Apparently, the latest craze in the toy world this year is some hatching bird toy called the Hatchimal. There have been stories of parents searching high and low for the toy and stalking other customers who had bought the last Hatchimal to their cars offering double the price that was paid. It’s available on Amazon for about three times the original price of $60, which I’m sure many are more than willing to pay. Parents who are unable to buy the Hatchimal have resorted to writing apology letters to their children from Santa Claus to explain why there will be no Hatchimal underneath the Christmas tree.

Recently, a co-worker asked me if I had given my toddler the Toys R Us catalog so that he could create his Christmas list. Um, nope! When someone asked my son what was on his list, he answered, “I don’t know.” Maybe when he gets older, I won’t be able to avoid this but as of now, he still hasn’t grasped the concept of Christmas meaning new toys and that he should make a Christmas wish list. I’d like to keep it that way for now. Plus, I think a wish list is just a recipe for disappointment if they don’t get what they asked for. Another person told me that telling your child that they may not get the Christmas presents they want if they don’t behave is a great tool to get your kids to do what you want, but shouldn’t they be good for “goodness’ sake.”

Some might be shaking their heads, thinking my poor child is deprived. I assure you he isn’t. He has plenty of toys to play with. He’s got trains, train tracks, cars, blocks (different types), Legos, a box of arts and crafts stuff, a play kitchen, puzzles, and dried beans. Huh? Did I say dried beans? Yes, dried beans. He has entertained himself with his beach toys pretending that the dried beans are sand. Yes, it’s cold here in the northeast and I guess he’s reminiscing about the summertime. Sometimes he puts the beans into his toy dump truck pretending it’s picking up dirt. When he was younger, he was more interested in playing with the box that the toys came rather the toy itself. And now that he’s an older brother, he plays with the baby’s toys too. He doesn’t discriminate against any toy…he’s an equal opportunity toy player.
puzzle

As much as us adults think that the expensive battery operated toys that makes sounds and moves are cooler, sometimes simple is better. I’m sure I’ll be accused of being cheap, but while that is a plus of buying simpler toys, it is not the main factor. The simple toys requires the child to use his or her imagination. My son will get excited with the battery operated toys that makes sounds and moves, but doesn’t play with them for long and eventually loses interest. With the simpler toys like the blocks, I see him building different things every time he plays with it and creating different storylines with them. Also, more is not always better. Research has shown that having too many toys may cause your child to be overwhelmed.

My wife and I will get A present for each of our two kids. They will also get gifts from the grandparents, aunts, uncle and close friends. And I am sure my older son will be excited opening his gifts on Christmas morning. Honestly, I don’t remember all that much about what gifts I received growing up, but I do remember Christmas day as a day my parents did not have to go to work and that we would have dinner with our extended family where I would play with my cousins with the new toys we got. I’d like to think that my kids will get the same amount of excitement from unwrapping Christmas gifts as they will spending time with their extended family.

Related post: How I was shamed for my frugality when I didn’t get something from Tiffany’s for my wife one Christmas. Update: My wife and I do exchange gifts but it’s usually something simple, something practical, something we made, or maybe we’ll go out to eat or some other activity. I would never buy something from Tiffany’s since we would talk to each other about such an expensive purchase first. And as a frugal person herself, she would not want me to spend that money. That year I was shamed. This year I was called a Scrooge!

What Christmas traditions did you grow up with? How many gifts are too many for kids?

It’s Okay to Drive a Minivan!

2011 Toyota Sienna XLE -- 05-18-2011

Recently, two of my co-workers were discussing their growing families and the need to buy a bigger vehicle. They discussed various SUVs with third-row seating to accommodate their needs. When the idea of a minivan entered the conversation, both immediately responded unequivocally, “I could NEVER drive a minivan.”

I have a friend who just had his third child and when I joked that it was TIME for a minivan, he said that his wife is completely against it as she does not want to be seen in a “soccer mom car.” But she IS a soccer mom? Another friend who also just had his third child, said that he has “held out” long enough and that he is finally “biting the bullet” and buying a minivan. It’s as if he were trying to avoid the bubonic plague!

All over the internet, in forums and articles about the best vehicles for families, I read the same vitriol towards the minivan. In the comments section of an article about minivans, one person asked, “is there anything sadder than seeing a dad shamefully climbing out of a minivan in front of his friends and colleagues…instantly beleaguered, defeated and utterly emasculated?” Wow! That’s harsh! Another commenter demanded that one’s “man card” be revoked for driving such an uncool vehicle. A mommy blogger compared it to wearing mom jeans and argued that she wanted to retain a semblance of her pre-mom coolness and did not want to be “defined” by her minivan. Some anti-minivaners would rather buy a behemoth like the Chevy Surburban than be relegated to soccer mom/dad status by driving a minivan.

After our recent addition to the family, we decided it was probably time to replace our old car. My wife was a trooper squeezing in-between two car seats in our Hyundai Sonata when there was another adult, but that wasn’t an optimal solution. A big vehicle really isn’t a necessity for a family of four, but my in-laws do not drive and my parents prefer not to have to drive as they are getting older. In any case, it just made sense to buy a vehicle where I could transport more people. So which is better? A large SUV or a minivan? I didn’t put too much stock in people’s opinion of the coolness factor as image is not my priority.

Doing the research on SUVs and minivans on various sites that talk about cars, I found a common theme. The writers would say that the minivan is the best people-mover, that it is the most functional, practical, and utilitarian choice, but lament the fact that it is ugly and uncool. Sure, I can see the possible coolness factor in a sports car or even sedans and cross-over vehicles, but was a huge SUV really sporty or cool compared to a minivan? I don’t know, and I’m probably not the best person to ask since I mainly see a vehicle as a tool to get from one location to another. Sure, I’d like a “sporty” looking car (whatever that means) with some of the newer safety as well as entertainment features, but ultimately I just want something reliable that does its job.

So after doing some research, deciding that the minivan was more practical, I bought a minivan. Here are a few reasons why I think a minivan is better than a large SUV based on what I read and on my experience so far:

Power sliding doors
– I love them. They’re awesome! I can open the door with a push of a button which is very helpful when I’m carrying a car seat or a bunch of bags. Sliding doors are also great because there’s no risk of the door banging into another car’s door in the parking lot.

Versatility – What good is a third-row if you can’t access it? My friends with SUVs that have a third-row tell me that you can’t get to the third-row if they have car seats installed. You’d have to uninstall the car seat, push the seat up, have the person climb into the third-row, then reinstall the car seat. Then you’d have to repeat this when it’s time to get out. That kind of defeats the purpose of having the third-row to begin with. Minivans also have more interior cargo space than large SUVs. Many of the seats in the minivans can be moved, folded down, or even removed to configure the space how you like it. This Motor Trend article is a bit dated but it does a great job comparing minivans with large SUVs.

Costs – If you compare the costs of a large SUV to the costs of a minivan, you’ll notice that minivans are more affordable. A large SUV like the Chevy Suburban can cost over $50,000 and the Ford Expedition starts at $41,700, while the Honda Odyssey starts at around $30,000. Your auto insurance premiums will also be cheaper. You’re a boring soccer mom or dad right? The insurance companies figure you’re probably not weaving in and out of traffic and making risky maneuvers on the road so you get a lower insurance premium! Fuel economy for minivans are generally superior to large SUVs so you’ll save money on gas too. The Chevy Suburban gets 16 city/23 highway while the Honda Odyssey gets 19 city/27 highway.

And finally, “it’s fun!” Well this is what my 3 1/2 year old son told me when he first climbed inside our new to us minivan. He also called it a “city bus.” Yea, it’s pretty big I guess.

Minivans have lost their popularity as most families flock to the big SUVs. Many car companies have tried to rebrand it, with Toyota calling its minivan a “swagger wagon.” Kia doesn’t even want to call its minivan a minivan, they call it an “MPV” (Multipurpose vehicle). It seems that when choosing a vehicle, most will choose style over substance. I don’t want to judge those who choose large SUVs over a minivan. It’s your choice, your money, and you can do whatever you want. But it just seems ridiculous that so many people will overlook a perfectly good vehicle choice because it might cramp their style.

Okay, can I have my man card back now? Oh wait, I never lost it. I’m not defined by what car I drive and I proudly drive a “dad mobile.”

Why do people despise minivans? Are they really that ugly looking?