Keeping Up With the Smiths

Keeping up with the Joneses is bad.  We know that.  From a financial perspective, we spend a great deal of our time overcoming the green monster called envy in order to keep our lives in some semblance of financial order.  We know the Joneses down the street with their big, fancy new SUV.  We see them going on long family vacations.  And we know the guy that mows their lawn.  But, we also know that there’s a pretty high probability that they still owe a ton of money on that SUV.  That that family vacation likely was financed through a credit card.  Their entire financial life depends on them keeping their well-paying jobs.

Forget the Joneses

I’d like to talk about another family.  The Smiths.  You don’t know them.  We don’t talk about them like we do the Joneses.  Why don’t we?  Because, outwardly, their lives are nothing to be envious of.  They don’t own a big house on a double lot.  They don’t drive a brand new Escalade.  Their family vacations consist of weekend trips to state parks or trips to visit family a couple of counties over.  Outwardly, they may even seem a bit downtrodden.  They may seem (GASP!) a bit poor.

Sometimes they are.  Sometimes, they are truly victims of their circumstance, or their poor financial choices along the way.  But, for every one of those families, there’s at least two that aren’t poor.  They have well paying jobs.  They have money in the bank.  And they occasionally barbeque a steak on the cheap grill they have on their back deck.  It’s those Smiths I’d like to talk about.

It’s the Quiet Ones You Have to Watch Out For

Why don’t we know the Smiths?  Because we live in a society that is enamored of our celebrity.  We hang on every word that that famous athlete, or famous actress says.  We try and model our lives after theirs.  They live a glamorous life, full of flashing photography, red carpets, and any number of endorsement deals.

Keeping up with the Smiths

Who wouldn’t want to be like that?  Short of being famous, we decide that we’ll see how close we can get.  The bank doesn’t turn us down for that big house, big car, or vacation to the same beach that the celebrities hang out on.  Maybe we’ll even get to see one of them!

But, it’s the Smiths we should know.  We should know people who live their lives responsibly within their means.  We should know people who live for more than having our fellow neighbors think about how rich we are, and how rich our lives must be.  We should be the Smiths.  We should be the people who drive the reliable older car without the flashy rims and booming sound system.  We should be the people who live in the smaller house that we try and repair ourselves.

Society may push us towards that Joneses sort of lifestyle.  After all, what would become of some of the companies if we stopped trying to keep up with the Joneses and stopped buying all their luxury goods?  What would the news and tabloids cover if we weren’t constantly buying their rags in order to find out what sort of clothes the princes and princesses of some foreign country were wearing this spring?

Shiny Facades, Crumbling Foundations

All around us, there are Smiths.  We don’t notice them, and we rarely get to know them.  We’re surrounded by the Joneses, and the shiny facades of businesses and economies that are driven by their reckless spending.  But, under those shiny facades is a crumbling foundation.  The economy of the world is on shaky ground.  We saw just how shaky it really was in 2008.  When the housing market crashed, it very nearly brought the entire world economy with it.  Luckily, the economy was strong enough at the time to take a beating.  It wasn’t strong enough to bounce right back.  It’s been a long slog back to where we were.  We aren’t even back there yet.  There are still parts of the world that are hurting economically.

Imagine, for a moment, if we rebuilt that economy, not on the sands of bailouts and extended unemployment benefits, and instead built it on the bedrock of hard work and frugality that got us where we were in the first place.  Imagine if we had seen the folly of our loose spending ways and tightened our belts, stuck to our budgets, and started building an economy that doesn’t shake and quiver at the smallest rise in unemployment, or the slightest miss in an earnings report?

What if, instead of running around willy-nilly chasing the lifestyle of the Joneses, we were calmly working ourselves into the stable economy of the Smiths?  What if we all didn’t have wait for our next paycheck to buy gas because our last paycheck went to our mortgage and car payments?  What if we were able to fill a tank of gas from the cash in our bank account and know that we still had our emergency funds to help us along should a real emergency come along?

We can.  We can bring our spending in line with our earning.  We can sell the fancy car that we don’t need.  We can downsize our house to something that we can afford.  Sure, the dependable used car you buy might not have as much chrome as the fancy one.  It might not have the same heated seats.  And the house you downsize to might not have a walk-in closet, or a jacuzzi bath tub.  I’ll let you in on a little secret.  You don’t need them.  They’re luxuries.  You only think that it’s normal to have those things because the Joneses told you it was.

We should be keeping up with the Smiths.

We can be the Smiths.

Frugal Estate Planning

One of the joys of getting married and having kids is that you then must face your own demise.  The poet Donald Hall wrote about this in his poem, “My Son, My Executioner” stating, as a man and his wife look down on their newborn son, “We twenty two and twenty five/who seemed to live forever/observe enduring life in you/and start to die together.”

Cheery, thought, eh?

Estate Planning Isn’t for the Faint of Heart

Yet, if you have children, you must plan for their future should you die while they’re still young.  I know, no one wants to do this.  In fact, 4.5 years ago when I was pregnant with my last child, I sat down to do a will and trust kit that I got online.  I only got about three questions in, before, in my wild hormonal state, I broke down crying when I started facing the questions about when I would want the cord pulled.

It took me another four years to feel ready to have our will written.

I know.  Irresponsible.  Yet, it took me that long to accept that yes, I will die at some point, and yes, I need to plan for it now, while I’m still healthy and (relatively) young.

It Takes a Strong Wallet, Too

However, facing my own mortality was only part of the problem.  Once I was ready to have a will written, I had to face the fact that it was unbelievably expensive!

We live in the suburbs of a large city, so I don’t know if that’s the problem, but the first lawyer we contacted quoted us $2,500 to set up our will.  When I told him that we are living on a smallish income and paying down student loan debt, he generously agreed to put us on a payment plan without charging interest.  While I appreciate the generosity, we still couldn’t afford $2,500, even on a payment plan!

Next, I contacted a lawyer from my small hometown, but he still was expensive, quoting $1,200 to $1,500.  As Dave Ramsey would say, “It’s not in the budget.”

A Frugal Estate Planning Option

Frugal Estate PlanningIn the end, we made a compromise.  My husband and I both knew we needed a will in place, but we didn’t have the kind of money lawyers were asking for.  Instead, we turned to LegalZoom.

For less than $250 total, my husband and I each had our wills drawn up.  We each answered a few simple questions online, and each will took less than 30 minutes to create.  Then we paid and waited for the lawyers at LegalZoom to look over the document.

Less than a week later, the wills came through the mail and were in our hands.

When we don’t have so much debt and have a larger income, we plan to get a will and trust set up in person with a lawyer.  However, for now, on our budget, LegalZoom works perfectly.  We have a will in place should anything happen.

Have you used LegalZoom for a will?  Would you consider it?  Does $1,200 to $2,500 for a will created by a lawyer seem outrageous or normal to you?

Are Money Saving Blogs Making You Broke? Three Tips to Avoid It

Google “How to Save Money”, and you are going to be overwhelmed with all of the choices. There are thousands of blogs and websites out there that offer money-saving tips and deals. However, being a faithful follower to some of these sites has caused me to spend more money. How is that possible?

I know I am not the only one who has fallen victim to spending money after reading a money-saving blog. Many days, I start my computer time by looking at my budget and inputting any new expenses. I know the limits on each budget category. However, once I head over to some of my favorite money saving sites, I feel the compulsion to spend.

How can I pass up that coupon deal for Whole Foods on Groupon? Look those adorable scarves are only $4 each, I can buy my Christmas presents early. Or look there, a coupon for applesauce pouches to make them only .35 cents a pouch – let me run to Target ASAP to get them.

Don’t think that I am blaming these sites, of course! My favorite sites have also been very beneficial getting free items or great deals, as well. However, keep these three thoughts in mind before you browse your favorite money saving site:

Money Saving Blogs Making BrokeNot All Deals are Actually A Good Deal

When I saw an applesauce pouch deal, I printed out all of the coupons to go forward with the deal. Yes, I was getting the pouches at about 50% off their shelf price, but the truth was, I was still overpaying for applesauce. It didn’t help that my 20-month old would suck down 3-4 pouches in minutes. I could just see the dollars being sucked away in her adorable chubby cheeks. After all was said and done, I had spent about $20 on applesauce that lasted about three weeks. The truth was I could have made a whole crockpot full of applesauce* for less than $10, and it would have lasted me longer since it would have been more sauce. I would have even saved time since for the pouch deal; I spent time researching and finding all of the right coupons.

Ask yourself, is this deal worth it? Is it worth my time to drive to the store and clip coupons?

Do I Even Need This?

What good is it to save money on purchases if you are buying things that you don’t really need? The expense of clutter is much greater than you think. Once I purged my house, I really didn’t want to spend money on building more clutter. I had five sets of plates. Some sets were bought very inexpensively, but in the end, they just took up more cabinet space and made me feel like I would never get caught up with dishes.

Wait on deals for a few hours – a whole day if possible. Allow the initial excitement to die down. If you have to be impulsive about your decision, then it will most likely be an impulse buy that you didn’t need. Another great idea is to talk it over with your spouse or partner, since they may help you think logically before buying. Finally, it is easy to have a list of things you need to buy. This way, when a deal pops up, you can easily decide if you need the deal or not based on your list.

You Aren’t Saving Money if You Are Spending It

It always makes me laugh when I buy a few things from Kohls and they tell me I saved a ridiculous amount. For example, buying a sweater, toddler shoes, and a nice gift all on clearance and with coupons has made the receipt tell me that I saved over $200. That sounds good, but the truth is that I would have never spent over $200, especially for the items I bought.

If you are on a tight budget, then saving $25 on a $50 on a restaurant gift certificate or saving 75% off of processed groceries you wouldn’t have bought usually is not actually saving you money. It can be hard to be on a budget with little wiggle room, but if you adapt a “Just Say No” policy, you will benefit. Just say no to spending any money, even if it looks like a great deal, just say no to spending an hour printing out coupons and looking up deal match ups, and just say no to driving out of your way to a store for one deal. Just say no, and enjoy staying on budget.

Like I said, I don’t have anything against deal sites and money saving blogs. However, if you find your being compelled to spend instead of save after visiting these sites, it is wise to take a step back until you can learn some discipline. It has been a hard lesson for me to learn, but my wallet is much fuller!