Search Results for “ignore-your-budget/subscribe-by-email/budget4/budget-lesson-part-5/future-dreams/medical-costs-and-choices”

Make a Budget

: Image by r.lovewell via Flickr

In the past, I’ve gone through a detailed series of budget lessons demonstrating how to make a budget and showing my personal budget spreadsheet template. If you weren’t here to see them develop, you probably haven’t seen them at all. I’ve never built an actual index for those posts.

This is the master index of my budget planning resources. As I develop more, this will grow.

Budget Lesson #1 – In this lesson, I go over how we handle discretionary income and I explain our modified envelope system. The discretionary budget contains things like our grocery bill, or the clothes we buy. We have near-total discretion over what is purchased, hence the name.

Budget Lesson #2 – Lesson #2 contains the details of our monthly bills. These are the ones that are consistent, predictable, and actually due each month. Most people take these for granted as the bills they have to pay, but it’s not true. You can get almost all of your regular bills reduced just by asking. You would also be surprised what you can do without, when properly motivated.

Budget Lesson #3 – This is where I explain how we deal with the non-monthly bills. That is, the bills that have to be paid, but are not due on a monthly basis. I also share the personal budget spreadsheet template I developed. I am working on a few sample templates to match various imaginary scenarios. If you’d like to be an anonymous case study, and get free help setting up a budget, let me know, please.

Budget Lesson #4 – In this lesson, I describe our “set-aside” funds for things that will need to be paid eventually, but not on a set schedule. Sometimes, they are never actually due. We set aside money for the parties we throw, for car repairs and for a number of other things. A few of these items are outright optional, but they are part of what makes life fun. You can’t make a budget without including some of the extras.

Budget Lesson #5 – This is the companion piece to lesson 2. Learn how I’ve reduced–or attempted to reduce–each of these bills. For the better part of two years, I called Dish Network every few months to ask for a discount. For almost 2 years, it was granted. Then one, day, they told me they were putting a note on our account to keep us from getting any more discounts, so I canceled. 100% discounts help us save more.

Budget Lesson #6 – This is the reduction companion to lesson 3. These bills are harder to reduce. Have you ever successfully gotten your property taxes lowered?

Budget Lesson #7 – This is the reduction companion to lesson 4. Notice a pattern, yet?

Budget Lesson #8 – Here, completely out of order, is the reduction companion to lesson 1. Watch as I magically reduce–or rationalize–our discretionary budget.

So, dear readers, what part of budgeting should I address next?

Medical Costs and Choices

Finance, Parenting

: Image via Wikipedia

I’m not a bad father.

Last spring, we noticed my son had a wandering eye. One of his eyes would just drift when he was looking at something. It was happening consistently, so we brought him to the eye doctor. After an exam, we found out that his eyes were 20/100. The doctor said that getting him classes may be enough to fix the wandering eye problem. The theory was that his eye was drifting because his eyes weren’t able to focus. Bringing the world into focus could have let his eyes train themselves to work right.

Nine months with glasses later, the problem hasn’t gone away, so we went back to the eye doctor.

He’s got alternating exotropia. His eyes aren’t working well together. One eye will focus, and the other will drift. So now we’re looking into vision therapists.

A friend went through something similar with his kid, so I asked him for the name of the doctor he used. He gave it to me and told me the clinic was the best in the business, and I would be paying for that. I asked about the cost and was handed the doctor’s spiel about how sad it is that parents focus more on the cost of care than getting the best possible care.

What a load of crap.

First of all, that’s a sales pitch. Of course the doctor is going to defend his prices. If his prices are exorbitant(I don’t have a basis for comparison) and he can’t defend them, people will go elsewhere. $3000 isn’t pocket change. That’s a significant chunk of change. Refusing to look at your options is irresponsible.

Second, price does not equal quality. There are a ton of things that are overpriced garbage. Not only do scam artists abound, but some legitimate things are are horribly overpriced at one location and reasonably priced at others. To stay on the vision theme, my $10 glasses are every bit as high quality as any $400 pair I’ve ever owned. The difference between generic and brand-name drugs? The label and the price. The FDA requires they be chemically identical to be sold. If you insist on the brand name because it’s “better”, you are flushing your money down the toilet. If you live by “you get what you pay for” you are guaranteed to get ripped off.

Third, balancing cost and treatment doesn’t mean I care less. Yes, I am killing my debt as fast as I can right now. Even when I was willing to use a credit card, I wouldn’t drop $3000 without considering my options. I have an entire family to consider, not one problem that my kid doesn’t even notice. Grr. I hate getting told–implicitly or otherwise–that I am a bad parent because I don’t choose to waste my money the way other people do. I’ll check out my options first, thank you.

Now, I will pay for the best when it is warranted. My wife wants Lasik and mentioned some sale some company was having. No. The guy sticking a laser and a scalpel in my eye will not be the lowest bidder. When I left the gene pool, I went to one of the top guys in the state for the procedure. When those things screw up, it’s permanent.

Vision therapy? Not so much. If it comes to surgery, we’ll go with the best. But it’s not there, yet. My kid is going to get a series of eye exercises, no matter where we go. Even if I go to some back alley vision therapist with a degree from a Nigeria U, what’s the worst case scenario? We may have to try someone else. Since I will be doing a bit more research than that, odds are better that my kid will get exactly the same therapy regimen for 1/4 of the cost. That’s the difference between a perfectly competent doctor and a perfectly competent doctor who convinced some trade magazine to write him up as the best in the business.

What do you think? Am I neglecting my kid by wanting to save some money for his braces, too?

Future Dreams

Relationships

While jogging with my wife a few days ago, we had a conversation that we haven’t had in years. We discussed our dreams.

It’s an important conversation for couples to have. What are your hopes? What are your dreams? Where do you want to be in 10 years? In 20? In 50? Planning for the future gives you a map for the present.

My wife and I hadn’t had this conversation in years. A few days ago, we did. Our life-goals are simple and achievable.

I want to leave the corporate world and support my family with writing and the training classes I do. I want a chunk of land outside of any major metropolitan area, but close enough for the entertainment and shopping. I want enough land to expand my classes on my own property, relying on no one.

My wife wants enough land to have some horses. It was unspoken, but I think she wants my goals to take off so they can support her goals, too.

We want a comfortable retirement and we want to help the kids with college.

We’re a bit behind the game for college funding. That’s ok, though. There is nothing wrong with a kid working his way through college and learning those life lessons.

We are also behind on the retirement. But, if I can support us doing the things I love, I don’t need $X million. Retirement isn’t a cessation of activity, it is taking the time to do the things you love on your own schedule. If writing a book while sitting on my private range is enough to fund our life, that’s the perfect retirement.

Dealing With the Police 101

Life

NEW YORK, NY - FEBRUARY 01: Shackles for slav... — (Image credit: Getty Images via @daylife)

Last night, a friend called me up and asked me to accompany him to the police station. The police had knocked on his door, waking up his girlfriend while he was out. When he called, they wouldn’t tell him why they wanted to talk to him. Was it an ex trying to make his life difficult or one of his employees getting investigated?

This friend has had a number of interactions with the police, but never learned how to deal with them. Before we left, I gave him a crash course in “stay out of jail”.

Lesson 1: The Police Are Not Your Friends.

During an investigation, you are a suspect. They are looking for a conviction. There may be a “good cop” trying to “help you out”, but he is trying to put you in jail. “Protect and Serve” doesn’t mean you. In general, it means society as a whole. During an investigation, they are serving the interests of the prosecutor.

Generally, they are going to look at you–as the target of their investigation–as the enemy. This is normal. They spend all of their time dealing with scumbags and s***heads. Naturally, they start to assume that everyone who isn’t a cop will fall into one of those categories.

Don’t get pissed when they act rude, ignore you, or anything else. It isn’t a lack of professionalism, it’s just a different profession. They are using interrogation techniques that have been proven successful. Ignore it and focus on Lesson 2.

It will feel wrong to disobey the authority you’ve been taught your entire life to obey. You’re not. You are standing by your rights. Nobody cares about your future more than you do. Certainly not the guy investigating you.

Lesson 2: Your Lawyer is Your Friend.

The second a police interaction starts to look like they are investigating you, demand your lawyer, then see Lesson 4. When you demand an attorney, they stop asking you questions. You can take it back and start talking, so again, see Lesson 4. It’s your attorney’s job to talk to the police and, if necessary, the media. It’s your job to talk to your attorney.

You don’t need an attorney ahead of time. Criminal defense attorneys are used to getting calls at 3AM. It’s part of their job. If you have a low enough income as defined by whatever jurisdiction you are being investigated in, you can get a public defender. That’s better than nothing, but I’d prefer to hire a professional shark, even if it means mortgaging my future. Prison is a big gamble.

Lesson 3. Consent is Your Enemy.

The right of the people to be secure in their persons, houses, papers, and effects, against unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon probable cause, supported by Oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized.

“Officer, I do not consent to any search and I would like to speak to my attorney.” Remember this. Memorize it.

They need probable cause, a warrant, or permission to search your stuff. Never agree to it. Don’t stop them if they search anyway, but never, ever agree to a search. If the search is done improperly, your lawyer(see Lesson 2) will get the results of that searched thrown out.

It isn’t possible to get into more trouble for standing by your rights. There is no crime on the books anywhere in the US called “Refused Consent to Search”. Your day will not go worse because you defended your Constitutional rights.

Lesson 4. Shut Up.

I know a few defense attorneys. According to them, most of the people in jail either committed a crime in front of a bunch of witnesses, or they talked their way into jail. Shut up. You’ll want to either justify or defend yourself depending on the circumstances. Don’t. Shut up. It may be one of the hardest things you ever do, but keep your mouth closed. The only thing worse than talking is lying. Don’t lie, just keep quiet.

There is nothing you are going to say that will make your interrogator invite you home for Christmas. He isn’t your friend, you won’t meet his parents, you aren’t going to his birthday party. There is absolutely no win in talking to him. Shut up. The answer to every question is “Lawyer.” If the only thing you ~~say~~ babble is “Lawyerlawyerlawyerlawyerlawyerlawyer”, you’re probably not going to do too badly.

In your car, the dynamic changes a bit, but the principles don’t. When a cop pulls you over, don’t argue. You can’t win an argument with a cop on the side of the road. Be nice, be polite, and as soon as possible, pull into a parking lot and take as many notes about the encounter as you can. If you are planning to fight whatever he pulled you over for, don’t give him any reason to remember you or spin his official report to make you look bad. Again, shut up. Catching a theme?

Gambling With Your Future

If you are being investigated by the police, your future–or some part of it–is on the line. While you are gambling with your criminal record and your freedom, don’t forget that you are an amateur in this arena. The police, the prosecutor, and your attorney are the professionals and the stakes can be huge. Keep your mouth shut, call your attorney, and thank me later.

Ignore Your Budget

Finance

For the first year of our journey out of debt, we had a strict budget, with all of our discretionary money spent out of an envelope system. We had an envelope for groceries, one for discretionary spending, one for clothes and one for baby crap. At the beginning of the month, we’d divide the money into the envelopes according to our budget spreadsheet. If we used a card for anything, we’d take a matching about of money out of the appropriate envelope and put it in a box to get reconciled the next month.

Ugh. Almost 2 years later, it has turned into too much work and too much nagging about everything either of us put on a card.

We decided to simplify the system a few months ago. Now, we still have a budget. It’s even a zero-based budget, but we ignore it. We only look at it if something changes for the worse. If something changes for the better, the extra money just gets automatically rolled into our debt snowball, so there’s no need to worry about updating the spreadsheet.

Instead of envelopes, we kind of eyeball it. We budget $450 per month for groceries, so we aim to spend $100 on our weekly grocery run. That leaves some room for losing track of how much we are putting in the cart, or a last minute addition to the list. It also leaves room for our secondary grocery trip to buy bread and milk later in the week. We do go through a lot of milk at my house. We budget $55 per month for diapers, but the deal we are currently getting with Amazon Mom is only costing us $30.79 for 6 weeks of diapers. We ignore the difference.

This—and our heavily automated bill pay and savings—lets us keep our finances on track, without stressing over every dollar or fighting over every little thing that comes home unplanned. I used to fire up Quicken and balance the checkbook every week. Now, that happens at the beginning of the month, usually. If I forget, it doesn’t matter. At the beginning of February, I balanced the checkbook for the first time in almost two months and we never came close to exercising our overdraft protection account. In fact, we had some extra, so that got sent directly to our debt.

Overall, it’s been good to test out a new system. We have almost no financial stress and managing our money takes about a couple of hours per month instead of per week. It’s all win.

Budget Lesson, Part 4

Finance

Part 4 of the Budget Lesson series. Please see Part 1, Part 2, and Part 3 to catch up. The Google Doc of this example is here.

The final category in my budget is “Set-aside funds”. These are the categories that don’t have specific payout amounts and happen at irregular intervals. When my car is paid off, there will be a car fund added to the list, instead of a new car payment.

Parties – We throw two parties each year; a Halloween party and a summer barbecue. We also have three children who have varying expectations and needs for their birthday parties.
Gifts – I don’t buy presents for my friends, and the number of relatives I buy gifts for has decreased dramatically over the years. I do, however, buy birthday and Christmas presents for my wife and kids and I participate in some form of gift exchange with my brothers and their wives. Combined, we set aside about $100 per month for parties and presents.
Pet Care – We have four cats and a dog. This is to cover cat litter and food the bunch. We have too many pets, but we can’t give them away. They are family. However, there is a moratorium on new animals for a few years. Two cats and a dog are our hard limit.
Car Repair – Cars break. Tires wear out. This isn’t a surprise, and it certainly isn’t an emergency.
Warranty Fund – We are building up our own “Warranty Fund“, to replace appliances when they break. I’d rather have the interest accruing than see this as a line-item fee on any of my bills.
Medicine/Medical – Kids get sick and prescriptions need to be filled. We figure our monthly prescriptions plus one office visit per month, but the money accrues in this fund. On low months, we have more, so we can cover the visits during flu season.
In The Hole – This isn’t actually a fund we set aside. If, for some reason, we go over budget one month, it gets entered here to immediately pay ourselves back for the over-spend. This month, this number is $170, which is how high we went over for Christmas. Since we have all of the “Set asides” and non-monthly bills stored in the same account, there was no actual debt, just this “paper” debt to ourselves. This serves the combined purposes of a mild punishment for overspending and a method to get back on track.

That is my entire budget laid out. As the series continues, I’ll be examining how I have lowered the bills, how I could lower them more, and how I’ve screwed them up.

Search Results for: ignore-your-budget/subscribe-by-email/budget4/budget-lesson-part-5/future-dreams/medical-costs-and-choices

Lesson 1: The Police Are Not Your Friends.

Lesson 2: Your Lawyer is Your Friend.

Lesson 3. Consent is Your Enemy.

Lesson 4. Shut Up.

Gambling With Your Future