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Don’t Screw Future-You

Finance, Life

A conversation between me and my temporally displaced self.
Future Me: Excuse me, Jason?
Me: Yes?
FMe: <Slap!>
Me: May I ask what that was for?
FMe: Of course.
Me: What was that for, jerk?
FMe: That was payback for all of the hell you have put me through.
Me: What?!?  I’ve never even met you, before.
FMe: Of course you have.  I am future-you, and I’m sick of getting screwed by past-me, that is, you.
Me: Huh?
FMe: Listen close.  You’re not  the sharpest brick in the box and I don’t want to explain this twice.
Me: ???
FMe: A long time ago, when you first met our wife, you were dumb.
Me: I don’t appreciate….
FMe: Shut up.  I was dumb then, too.  Remember?  You…err…we bought a new truck, built an addition on our…err…your…err…whomever’s house, got married in the same year.  On top of many other expensive decisions.  Do your recall?
Me: Yes, I do.  So what?
FMe: If that wasn’t enough, you and your smoking-hot bride are still shopping like you’re rich. You drive a new car.  Your kids wear new clothes.  You’ve got a house full of new furniture.  How did you pay for all of that?
Me: Naturally, I charged it.  Zero payments, zero interest for a year!  Pretty smart, huh?
FMe: What happens in a year?
Me: I don’t know.  I’ve got a full year to figure that out.
FMe: <Slap!>  I’ll tell you what happens!  Future-you, that’s me, gets screwed!   Your raise didn’t come through.  You had a baby. The truck broke down.  Your wife took maternity leave.  A roommate moved out.  You took a loss in the stock market.  You didn’t plan!  You had no savings to cover any of those problems because you were too busy servicing debt to pay for your current life.
Me: How was I to know?
FMe: <Slap!>  Life happens!  You never know what is coming next.  You need to plan and save for what might happen.  Otherwise, you’ll just accumulate more debt to be serviced by yours-truly.  That is not acceptable.
Me:  So?  What are you going to do about it?
FMe: <Slap!>
Me: Really?  Again?
FMe: <Slap!>  I’m struggling to pay your debt. Your son starts college next year, but you’ve left me completely unable to help.  Your daughter wants to get married in a couple of years, but the Father-of-the-Bride can’t afford a tux.  My wife, your beatiful bride, wants a vacation that I can’t afford.   You’ve screwed me, dude.
Me: I’m sorry.  What can I do to fix it?
FMe: Buy me dinner, first.
Me: Huh?!?!?
FMe: Stop the excess spending. Spend less than you make, for a change.  No credit.
Me: None?
FMe: None.  Nada.  Zip.  Zilch.  Only spend what you can afford. Budget.  Pay off those nasty bills.  Don’t leave me hanging.
Me: So, what you’re saying is that, if I don’t have the money, I shouldn’t buy it?
FMe: Exactly.  That’s the path to wealth, freedom, and financial independence.  Live in the real world.
Me: Gee, thanks, Future-Me!  Now I know.
FMe: And knowing is half the battle.

What would your future-you have to say to you?

 

Priorities

Business

I once saw a sign on the wall in a junkyard that said, “Failure to plan on your part does not constitute an emergency on my part.”

Another good one: “If everything is top priority, nothing is top priority.”

Once a week, I meet with my boss to discuss my progress for the previous week and my priorities for the coming week.   This is supposed to make sure that my productivity stays in line with the company’s goals.

Great.

Once a day, my boss comes into my office to change my top priority based on whichever account manager has most recently asked for a status update for their customer.

Not so great.

At least twice a week, he asks for a status update on my highest priority items.   Each time, he could mean the items we prioritized in the weekly meeting, or the items he chose to escalate later.   Somehow, getting a new task escalated doesn’t deescalate an existing task.

Everything is a top priority.

To compensate, I’ve been working a few 12 hour days each week, and occasionally coming in on the weekends.

I’m dedicated and still behind.

Prioritizing is treated as an art, or in the case I just mentioned, a juggling act.  It should be considered a science.  It’s usually pretty simple.

  • Is the problem costing you money? +1
  • Is the problem costing your customer money? +2
  • Is the problem going to hurt your reputation? +1
  • Is there a deadline? +1
  • Is it soon? +2
  • Is it urgent? +1
  • Is it important? +2
  • Are there absolutely no real consequences for anyone if it doesn’t get completed? -500

That’s it.    Too many times, we get hung up on urgent-but-not-important items and neglect the important things.

The hard part comes when it’s someone else setting your priorities, particularly when that person doesn’t rate things on urgency, importance, and cost but rather “Who has bitched the loudest recently?”

Can I tell my boss that I’m not going to do things the way he told me too?  No.  A former coworker very recently found out what happens when you do this.

Can I remind him that I’m busting my butt as hard as I can?  Yes, but it will just earn me a request to come in on the weekend, too.

Can I ignore the official priorities part of the time, and work on what I feel is most important to keeping our customers happy?  Yes, but it’s easy to go too far.  “Boss, I ignored what you said, but this customer is happy, now!” won’t score me any points if it happens every week.

Priorities are simple, but not always easy.  How do you balance your priorities?

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5 Ds of Identity Theft

Finance

Scanned image of author's US Social Security card.
Scanned image of author's US Social Security card. (Photo credit: Wikipedia)

Identity theft is, at its most basic level, the act of using someone else’s identity or credit without permission.   From a stolen credit card to a forged phone bill in Moscow, it all involves your good money paying for the bad habits of another.    Thankfully, there are ways to reduce the odds of having your identity stolen.  LTC David Grossman reviews the “5 Ds of Survival” in his seminars and books.   Today, I bring you the 5 Ds of Identity Theft.

In the words of the master, “Denial has no survival value.” Denying the possibility of identity theft will not keep it from happening.  You have to take steps to keep yourself safe.  “It could never happen to me” is not a valid defense mechanism in any situation, financial or otherwise.

Deterrence means keeping the information away from identity thieves. The harder it is for the criminals to get your information, the more likely it is that they will move on to an easier target.  And yes, a kid stealing Grandma’s credit card is a criminal and needs to be treated as such.

  • Some people use a shredder, but not me.  I have a fire pit that catches all of my personal documents.  I’d like to see an thief get my social security number from the ashes in the bottom of the pit.
  • Don’t carry your social security card.  If you lose your wallet, your driver’s license and social security card contain all of the information needed to steal your identity.  Keep it locked up at home and don’t give the number out unless absolutely necessary.
  • Don’t use stupid passwords.  Anything listed on yourFacebook profile or otherwise available on Google in association with your name is a stupid password.  Don’t make life easy for the people looking to screw you.  Your birthdate, maiden name, and “password” all qualify as stupid passwords.  Use KeePass to securely generate and store your passwords.
  • Lock up your personal information.  I throw two large parties every year.   Purses and wallets get stored in a locked bedroom, so nobody can grab them.  That was a lesson learned the hard way.  If there’s someone in your home you don’t trust absolutely, lock up anything that can be used against you.
  • Don’t release personal information to anyone, for any reason, unless you have initiated the contact.  Don’t give a credit card number to a telemarketer.  Don’t give a spammer your personal information.  It’s your privacy, use it.
  • Don’t click anything in an email.  If it’s a company you have a relationship with, type the address in your browser by hand.

Detection is up to you. Some credit card companies will alert you to suspicious purchases, but you can’t rely on it.  I was once called because I went to the gas station and Best Buy, which is apparently a common pattern for a stolen credit card.

  • Examine your credit card statements.  If there’s a purchase you don’t recognize, find out what it is.
  • Watch for bills to arrive as expected.  You do know when you pay the gas bill every month, right?
  • Watch for unexpected bills to arrive.  If you get a statement for a credit card you don’t have, it’s a problem.
  • Check your credit report three times per year.  AnnualCreditReport.com will let you see each of the three major credit reports each year.  Space them out so you see your report every 4 months.

Defending your identity happens after you’ve detected a theft. This involves getting your credit and sometimes, your money, back.

  • File a fraud report with the credit bureaus.  This will force potential creditor to follow certain procedures before opening new credit accounts for your identity, including calling your cell phone, if you choose.  Stop the identity theft in its tracks.
  • Close the fraudulent accounts.   Don’t leave them open for abuse.
  • File a police report and report the fraud to the FTC at ftc.gov/idtheft .  This may or may not help catch the criminal, but without it, there will never be a punishment.  Make stealing your identity an expensive proposition.   Hopefully, 1o years of his life will be wasted in jail in return for the theft.

Destroy.  Unfortunately, fraud and identity theft are not yet capital crimes.   Maybe someday.

Deter, detect, defend.  These are the secrets to avoiding, and recovering from, identity theft.

 

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Decision Making Made Easy

Life

Cinderella Castle at the Magic Kingdom, Walt D...
Image via Wikipedia

Have you ever had to make a difficult decision?   Not necessarily a decision that’s difficult because it’s life-changing, but a decision that’s difficult because there are two phenomenally wonderful, yet mutually exclusive options?

For example:

  • Should you put caramel or strawberry sauce on your ice cream?
  • Should you go to Disney Land or Disney World?
  • Should you subscribe to Live Real, Now by email or RSS?
  • Should you take the job with the stellar benefits package or the higher salary?

These are all real decisions that you may be called on to make.

For most decisions, there are some alternatives that are easy to discard.

MadDog 20/20 isn’t a good alternative to caramel sauce on your ice cream.   The local BDSM museum probably isn’t a great choice for a family vacation.  Sending me hate mail is obviously worse than subscribing.

Then you’ve got some choices that are both okay, but one is clearly better.    You’ve got free airfare and hotel.  Do you go to Topeka, or Paris?  Neither is horribly, but I think the choice is obvious. You’re going out to dinner.  McDonald’s or…nevermind, this fits the first category.

After you’ve discarded the obvious bad choices and the okay-but-not-great choices, how can you decide between what’s left?

This is the point that starts to cause stress.  What if you make the wrong choice?  What if you regret it forever?   What if you’re still not happy?  Gridlock.

The reason your stuck is because it’s not apparent which is the better choice.  All of your experiences and knowledge are telling you–on some level–that the options are identical in terms of your life, happiness, and goals.    It truly does not matter which one you choose.  You will probably be equally happy, either way.

Given that it doesn’t matter, you have two choices for making the final decision:

  1. Pick the one you want.   The rational decision is a tie, so make it an emotional one.   Does one job match your dreams, but with a bit more risk?   Has one vacation destination been a goal since you were little?  Do it!
  2. Flip a coin.  If the decision doesn’t matter, leave it to fate.  That way, if it doesn’t work out, you can always blame the quarter.

The one thing you don’t want to do is wait.  Failing to decide is still a decision and one that is guaranteed to keep you from being satisfied with your choice.   Don’t wait until you have all of the possible information, because that kind of perfect world doesn’t exist.   Get to about 85% of fully informed and run with it.  You’ll usually be happier making a decision–even the wrong one–than sitting back wondering “What if I had done that?”

How do you make hard decisions?

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Fall From Grace

Finance

When you accumulate a certain level of debt, it feels like you’re wading through an eyeball-deep pool of poo, dancing on your tiptoes just to keep breathing.   Ask me how I really feel.Tip Toe

It shouldn’t be a surprise that I’m in debt.  We have gone over this before.   The story isn’t one of my proudest, so I’ve never talked much about how it happened.

Our debt was entirely our fault.  We messed up and dug our own poo-pool.   There were no major medical bills, no extended unemployment, just a strong consumer urge and an apparent need for instant gratification.  Delayed gratification wasn’t a skill I’d considered learning.  The idea of it was a thoroughly foreign concept.   Why wait when every store we visited offered no payments/no interest for a year?   We didn’t give much thought to what would happen when the year was up.

We got married young.   We bought our house young.  We started our family young.   We did all of that over the course of two years, well before we were financially ready.   Twenty years old, we had excellent credit and gave our credit reports a workout.   Credit was so easy to get.    By the time I was 22, we had a total credit limit more than twice our annual income.  We fought so hard to keep up with the Joneses.   A new pickup, a remodel on our house.   Within a month of paying off the truck, I got a significant raise and rushed out to buy a new car.

Every penny that hit the table was caught in a net of lifestyle expansion.   I was bouncing on my tiptoes.

Four months into my new car payment, I was laid off.  There’s me, hoping for a snorkel.  A week later, we found out our son was going to be a big brother.   Our pool had developed a tide.

We killed the cable and cut back on everything else and…managed.   Money was tight, but we got by.  I got a new job, but had we learned any lessons?  Of course not.   We got a satellite dish, started shopping the way we always had.  Times were good, and could never be bad.  We had such short memories.

Fast forward a couple of years.   Baby #3 is on the way while baby #2 is still in diapers.   Daycare was about to double.  Daddy started to panic.   I built a rudimentary budget and realized there was no way to make ends meet.   There just wasn’t enough cash coming in to cover expenses.   That’s when I made my first frugal decision:  I quit smoking.  That cut the expenses right to the level of our income.  It was tight, but doable.

There was still one serious problem.    Neither one of us could control our impulse shopping.   For a time, I was getting packages delivered almost every day.  It was never anything expensive, but it was always something.  Little things add up quickly.

Last spring, I realized we couldn’t keep going like that.   I started looking into bankruptcy.   Somehow, we managed to toss ourselves into the deep end of the pool.  We had near-perfect credit and no way to maintain it.

While researching bankruptcy, I found our life preserver.   We put together a budget.   We cut and…it hurt.     It’s taken a year, but every bill we have is finally being tracked.   We have an emergency fund and we are working towards our savings goals.    It hasn’t been an easy year, but we are making progress.    We’ve eliminated 15% of our debt and opened out budget to include some “blow money” and an occasional date night.   We are always looking for ways to decrease our bottom line and increase the top line.   Most important, we are actually working together to keep all of our expenses under control, with no hurt feelings when we remind ourselves to stay on track.

We are finally standing flat-footed, head and shoulders above the poo.

Update:  This post has been included in the Carnival of Personal Finance.