My parents are trying to reduce the amount of “stuff” they have, knowing they will soon want to move off their acreage into a smaller home in town. As I see how challenging this is, I can’t help but be aware of all the things I’ve accumulated, too.
Most Americans have a healthy supply of “stuff” . Having more than we need is not a bad thing; but having more than we can use, enjoy or appreciate? That may be the definition of wasteful.
Frequently, we will enrich our lives (or the lives of our children or others) more if we invest in experiences rather than in things. Experiences will never sit and gather dust in a closet; the memory and the learning will always be vital. In many cases the best gift is not another sweater or another household item, but instead an experience.
What kind of experience? There are so many options: a meal at a unique ethnic restaurant; attending a play; piano or guitar lessons; building something with others; a day at the museum. Experiences don’t need to cost money either: consider volunteering, offering to teach someone a skill; planning a regular walk with a neighbor or friend.
If the holiday season causes you to reflect on your priorities and you wish to focus your energy and resources where they will really matter, I encourage you to pay attention to how you balance experiences with things.
NOTE: I don’t want to suggest that experiences are right and things are wrong. All things are not wasteful, certainly; some are needed, some bring lasting enjoyment, and some (such as board games or building blocks) create beneficial experiences. Likewise, some experiences have little or no value. But if we are conscious of maintaining an appropriate balance between things and experiences, we’ll be more satisfied, and also less wasteful. ~Barb
There is a lot of commercial excess in the world around us, and it’s especially evident at this time of year. The messages of “Buy, Buy, Buy” and “I want, I want” are SO dominant at holiday time. On top of that, we may observe our friends and neighbors and feel tempted to “keep up with the Joneses.”
It is a challenge to be a responsible consumer! How do we remain firmly committed to our own priorities in the midst of messages of excess?
I don’t have a magic answer, of course, and I won’t pretend I never give in to messages that pull me away from my priorities. But I can point to some key financial principles that can help us.
- It’s all about goals. If we clearly identify our goals, articulate why they’re important to us, and post them where we’ll see them, then we are better able to say “no” to distracting options.
- Limits are helpful. Life is rarely “all or nothing.” Most of us want to spend some money beyond our minimum needs; we just don’t want to spend too much. To be in control of our money, we can make a plan that includes limits for each type of spending. Then choose a method for sticking to that limit. One method is to use cash. Give yourself so much cash for the week or for the spending category, and when it’s gone, it’s gone.
- We always have a choice. Even though there is excess around us, it only enters our lives when we choose to let it in. When we see an option that wasn’t in our plan, the best thing we can do is to stop and decide: if I spend money here, then what part of my planned spending will I give up in exchange? We may want to blame the store displays or our friends, but our decisions are ours alone.
How will you focus on your priorities during the holiday season and beyond?
Did you receive a letter in the mail informing you your health insurance plan would end on January 1st? Then it’s time to take action!! As much as we would like instant service when we make a purchase, health insurance is a product that requires some behind-the-scenes work before a policy can be activated. The Marketplace (www.healthcare.gov) advises individuals to complete their applications by the 15th of the month in order for a policy to be active by the 1st of the next month; that means next Monday, December 15, is an important date! Note if you are working with an insurance agent the deadline may be different. You can still make adjustments in coverage after Monday, but there may be a delay until February 1st for changes to take effect.
Personal needs change, policies change, and income guidelines for subsidies change. You should log back into your Marketplace account or call 1-800-318-2596 to review your personal information and make corrections. The Marketplace plans will automatically enroll you in the same plan you had in 2014, unless you log in and make a different choice. Don’t assume that the policy that was your best choice for 2014 is still your best choice for next year. Here are some key items to check:
- Who are the in-network providers for the plan? Does the list include the doctors/clinics you normally use? Did a plan you ruled out last year because of network limitations change its network for this year?
- Does the formulary (which lists co-payments for prescriptions drugs) include the medications you take or might take in the next 12 months?
- Have the cost-share terms (deductibles, co-pays) changed for some of the medical procedures or services you will need?
Taking action by MONDAY will make it more likely you have the right health insurance policy beginning on January 1st.
We all have gift-giving challenges. Try thinking of other ways to give a gift.
- Give a gift of time. Create your own Coupon Book and give vouchers for babysitting, car washing, pet sitting, doing chores, making dinner…you name it!
- Give handmade gifts. How about a memoir, a book of family recipes, or a calendar filled with birthdays of family and friends.
- Offer to teach a skill you possess. You have skills. Share them! Knitting, photography, computer skills, music lessons, or cooking a favorite recipe.
- For kids, give timeless gifts that encourage creativity, such as: arts and crafts supplies, books, a magnifying glass or building blocks.
- Shop for secondhand items. Visit thrift stores, garage sales, and online services like Freecycle – you can find nearly anything.
- Create a paperless holiday letter. No more licking envelopes! Put together a colorful and creative holiday letter (with photos of course!) on the computer and email it to friends and family.
- Give back to your community. Prepare care packages for the homeless, or volunteer to help those in need.
- When it comes to décor, adopt a “less is more” attitude. Opt for natural trimmings, like clippings from evergreens or holly bushes.
- Save paper by using alternative gift wrap. Use newspaper comics, paper bags, old maps, or other reused paper.
- Prepare sustainably-made holiday meals. Use as many seasonal, locally grown foods as possible.
Alternative gifts can be great for those on your list who already have everything; they also may save money and may be better for the environment. It’s a win-win!
Consumer Knowledge, Smart shopping
I walked through the airport to catch the first flight of the morning. Many of the gates were empty and dark, until…a sensor somewhere detects my motion and lights up the area.
I start down an empty freezer isle at the grocery store and the dark cases full of frozen veggies, light up as they sense my presents.
I enter the dark bathroom in my daughters home and the lights magically turn on before my hand can find the switch. This was installed for the benefit of a toddler who could not reach the switch.
Stairways, halls, and garages get a lot of through traffic, and people often forget to shut off lights once they’ve passed by. Motion sensors turn lights on when you walk in and off when motion is no longer detected. Indoor sensors range from $15 (with the sensor fixed in the wall switch) to $45 (a kit with a separate sensor to put where you’d like). Outdoor ones can cost $16 (for basic floodlights) to $100 (for more decorative or powerful models). Motion detectors can be used to save energy, boost your home security by turning yard lights on, and safely light the way into a room.
Motion sensing switches do have some “phantom” energy use, using about a watt of energy on standby mode (23 hours a day) and 5 watts on active mode (about an hour a day). This trims a bit off of your overall savings, but over the course of a month, assuming your electricity costs the nationwide average of $0.11 per kilowatt hour, the switch itself will devour 0.84 kilowatt hours, or about $0.09 of energy, every month. How are you using motion sensors in your home? ~Brenda
Consumer Knowledge, Saving, Smart shopping
Almost everything you see this holiday season will encourage you to spend money. You may feel pressured to buy the “best” gift. In fact, according to the Consumer Federation, 1/3 of us plan on spending more during the holidays than last year.
Are you looking for ways to not blow your budget this holiday season? Make a commitment right now to be smart in your spending and keep to your spending and savings plan. Say it with me: “I will not break my budget this holiday season.”
So – HOW to make that happen. Hmmm…
Take a look at your financial situation and your goals:
- Focus on your needs and priorities – Not holiday presents or decorations; put your focus on priority items like a down payment for a house, saving for a child’s education, or building the emergency fund.
- Create a spending and savings plan to reach your goals –Do it now before you start holiday spending or incur any unnecessary debts.
Once you know how much you have to spend, use these tips to keep spending within your budget:
- Form gift exchanges (in other words, draw names within a group, so each person buys only one present instead of many) – Not all families may want to do this, but it should definitely work with friends. After all, reducing the number of your gifts you have to buy can save you money.
- Make homemade gifts – Make a food dish, movie night packages, remote holders, or candles. There are great ideas available on-line and in magazines and books to inspire you. You can knit, sew, glue, fold, stir, or recycle to create a handmade gift that keeps your spending low and your personal investment high.
- Share a skill –Give a coupon for one dog walk or one house cleaning; offer to teach your grandmother how to use the computer; or arrange to teach a niece or nephew how to cook a meal.
Don’t let this holiday season break the bank.
Credit, Smart shopping, Spending plans
What do you give to someone who has everything? I frequently struggle with that question, and I know I’m not alone. For these situations I’ve come up with three ideas I have found useful.
The first idea I turn to is to give them something they can use up. Something consume-able, such as:
- Wine, or baked goods, or specialty cheeses
- A nice meat bundle for the oven and grill
- Restaurant or theater gift cards
Sometimes, though, those ideas have all been used, and I want a new idea. In recent years, I have tried a different gift-giving approach for people I care about who already have much: instead of giving them something, I’ve given a gift to a charity in their name.
If I know of a charity they really care about, then that has been a good option. But another fun option has been to buy a certain farm animal for people in a third-world country. This is an option I’ve found through a reputable religious organization. They offer a catalog with gifts available at many different price levels: ten baby chicks are inexpensive; a cow is quite expensive (I’ve never bought a cow). One year I “gave” my parents a pair of goats. These goats went to a developing country where they were designed to enable a family to improve their economic well-being. In addition to farm animals, I’ve also seen the option to buy school materials for communities in need, or malaria nets or malaria medicine. Many options exist.
A third idea that I really like applies to children who have everything. Sometimes the best gift is a gift of savings – for college or other education after high school. When you put money aside for a child, you are giving them the gift of a future. This is especially valuable for children whose parents are unable to save for the child’s future. When you put money away for education, you are saying to the child “I believe in you. I believe you will do something excellent when you grow up.” You might also help the child (depending on his or her age) think about saving some of their own money too. Helping them learn to plan and dream and save for the future is a great gift to a child.
What gifts do you especially like to give?
Saving, Smart shopping
The other day a friend asked me about health insurance. She said “I’ve been getting all this different advice: ‘Go see Agent X – he’ll fix you up;’ or ‘Agent Y found a really good plan for me.’ I’ve seen a couple different agents and I’m confused.”
Until she talked with me, no one had suggested checking on www.healthcare.gov .
I don’t know what her income is, but I think she may be eligible for premium tax credits to help pay monthly premiums for health insurance. But before our conversation, she didn’t realize that help was available. The key point I explained to her was this: Premium Tax Credits are only available if you buy your health insurance in the official “Marketplace” through www.healthcare.gov
Some insurance agents will help customers enroll in plans offered in the Marketplace. They only receive a tiny commission for helping clients, but they do it anyway, because they want to serve their customers well. If your income is below the income guidelines for premium tax credits (over $90,000 for a family of four), make sure your insurance agent shows you the plans available in the Marketplace and explains how the premium tax credits work.
To find a health care navigator or certified application counselor near you, go to www.getcoveredamerica.org/locator
Health Insurance is important. Even if a cheaper plan is available somewhere else, you may come out ahead by purchasing a plan in the Marketplace, where Premium Tax Credits can help cover the cost of a plan that meets high quality standards.
If you’ve read the state-wide news recently you know that a grocery store in Iowa has filed for bankruptcy. Included in the details is the report that pension benefits have been suspended. I was puzzled by a press statement that an individual had lost a significant sum of retirement money. The wording might have been misleading because individuals don’t contribute to pension plans; they are totally funded by the employer. Unlike a 401K , what you have is a promise of future benefits if the company remains in business and is financially sound. So will the individual lose all those promised payments? Maybe, maybe not.
Companies who still offer a pension plan can participate in the Pension Benefit Guaranty Corporation (PBGC). PBGC is a US government agency created in 1974. PBGC is not funded by general tax revenues; it collects insurance premiums from employers that sponsor insured pension plans. The premiums are invested to earn revenue and PBGC receives any remaining balances in a pension account if a company is dissolved due to bankruptcy.
The benefit for employees who are eligible for an insured pension is a guarantee they will receive at least part of their benefits if the company fails. The maximum pension benefit guaranteed by PBGC is set by law and adjusted yearly. For plans that end in 2014, the maximum guarantee for workers who retire at age 65 is $59,318.16 yearly ($4,943.18 monthly). The guarantee is lower for those who retire early or when there is a benefit for a survivor. The guarantee is increased for those who retire after age 65.
At the PBGC website you can find out if your company participates; track down a lost pension; and find resources related to retirement. http://pbgc.gov/home.html A search of the site didn’t answer the question about the grocery store, but I did find my husband’s pension fund.
I live in a food desert. That means it’s a place without ready access to fresh, healthy, and affordable food. The USDA defines a food desert in relation to household income and distance to a grocery store. http://apps.ams.usda.gov/fooddeserts/foodDeserts.aspx
The reality of what it means to live in a food desert has been driven home in the last month, as our one grocery store in the county seat began a move to a new location. In anticipation of the move the inventory was allowed to diminish. During the past two weeks it was getting harder to find items I usually purchase; I needed to substitute or scratch items off my list.
I travel extensively and can easily dovetail a work day in a location 25 or more miles away with a stop in a community with 3 or more grocery stores. For me, a solution is easy, but it’s not so easy for the elderly or the low income who must balance food costs with the expense of a 50 mile round trip. Several years ago I compared the cost of buying food locally to the cost if bought in the other communities. If you factor in travel, the lower prices in bigger towns don’t make up for the transportation expenses. The local store doesn’t compare in square footage to the super stores, but it is part of a larger chain with advertised specials that are available statewide. If I utilize those specials, I can make it even smarter to shop in my home town.
Today is the grand opening of the new store. I’m looking forward to not feeling the food desert impact so clearly.
Saving, Smart shopping