6 Things Your Debt Is Costing You

I am not a fan of debt.  Most financial bloggers will agree with me.

Have you ever thought of the things that your debt can be costing you?  Here are six things that I came up with in just two minutes time!

  1. mb-201312billscoins – This is the obvious one.  When you have debt, you have to pay it off.  This is money that comes right out of your income stream, and because it’s for an item you already paid for, you are paying present money for past purchases.  There is absolutely no joy in that.
  2. Opportunity – When you pay money for your debt payments, that takes money away that you could use for other things, including making money!  Your $500 debt payment is gone, but a $500 investment in the stock market is an opportunity for future gains.  But that’s lost when you have the debt payment that comes first.
  3. Freedom – Every debt payment you make requires a certain level of income.  For some people, debt takes any income gap and then some.  These are people in extreme debt.  But, even those not in extreme debt end up with a correlation between debt and income that sees you relying on your income so that you can pay off your debt.  You’re still able to make the payments, which is great, but you’re in essence stuck doing whatever you’re doing to make income for as long as you have debt.  Remember the people in extreme debt I talked about earlier this paragraph?  The ideal thing is to be on the other extreme, where you have no debt.  When you’re there, you have freedom without having to worry about the next debt payment.
  4. Happiness – Debt causes anxiety.  Anxiety causes stress.  Stress reduces happiness.  Therefore debt costs you some level of your happiness.
  5. Sleep – Have you ever woken up and started thinking about your debt?  If you have, then chances are, rolling over and going back to sleep isn’t in the cards.  There are few things worse than being kept at night…because of debt!
  6. Your Net Worth – Financial freedom is obtained by increasing your net worth.  When you make debt payments, you’re taking an asset to pay off a liability.  This means that your debt payment realistically results in zero net worth growth.  In fact, once your next statement comes in the mail, your interest is a new liability, which actually reduces your net worth!

As you can see, debt is kind of the worst.  If you’re in debt, then getting out of debt will help you gain back some of the costs above, and I’m sure there are others.  If you get out of debt, then stay out of debt so you don’t have these costs come up and get you again.

Readers, what other costs are associated with debt?

Copyright 2014 Original content authorized only to appear on Money Beagle. Please subscribe via RSS, follow me on Twitter, Facebook, or receive e-mail updates. Thank you for reading.

I’m Officially (Pop Culture) Old

With the exception of a few brief breaks, I’ve subscribed to Entertainment Weekly since I went to college in 1992.  I actually started reading it when my dad first subscribed even before that, which I’m pretty sure he started his subscription not too long after the magazine was launched in 1990.

For the most part, I’ve really enjoyed the magazine, and it’s always helped me learn about movies and TV shows I want to watch, music I want to listen to, books I want to read, and stories about various elements in the entertainment industry.

The last couple of years have been nice because I’ve gotten the magazine for free.  Our city is part of a recycling rewards program, where you get points for your curbside recycling activity that you can then redeem to things like gift cards, local stores and restaurants, and magazine subscriptions.  It’s pretty cool to get free stuff for doing something that we would do anyways.

Lately, I’ve found that I have barely been reading my Entertainment Weekly magazine anymore, and when I do, I might spend a few minutes on it.

Since it’s a reward that ties to recycling, I feel a little bit of guilt of the wastefulness (even though I do recycle the magazine).  I also have to wonder if it’s time to give up the subscription as I just don’t seem as interested in a lot of the information, combined with the fact that I can get much of the information elsewhere.

Consider:

  • Movies – I’ll be honest.  I barely watch movies anymore.  This makes me sad in a way because I used to love going to the movies, renting movies, and could tell you just about anything with movies.  Now, we might go to the movies once a year (not counting the kids movies), and we have such little time to watch movies that I can easily get my fix through Netflix.  I can look up the info on the web for the few times I need it.
  • TV – The information on television shows is probably the most handy, but I can get that in so many places that it’s just not as useful anymore.  My website of choice for TV information is the TV section of the AV Club.  I usually get information leading up to shows that trigger interest, and that’s generally enough.
  • Music – Again, back in the day I would buy tons and tons of CDs (mostly by the mail order services that I don’t believe exist anymore), so the information on music would be very helpful.  Now, I listen to the radio, to streaming music (via Slacker), and download MP3s through the Freegal app associated with my library. On the rare occasion a song or album really interests me, I’ll buy it or download it, but it’s just not often enough to justify a weekly update.
  • Books – I do all of my reading by renting books from the library.  I subscribe to a newsfeed so whenever the library gets a new book, I can look at it and decide if it’s something I want.  I have found a few books in Entertainment Weekly that I later went back and checked out for a read, but I don’t really need the magazine to help me find stuff I like to read.
  • Stories on pop culture – The magazine does a great job of doing some headline stories often tied to the things above.  Which is great, except now that I am not as engaged, they’re not as interesting as they used to be.  Plus, I generally read NBC News and CNN, and can get a handle on what’s going on.

I think when the current subscription runs out, I will not re-subscribe.  I may consider switching to the e-tablet version that I believe you can now get for points, but I’m not even sure about that.  While it’s not costing me anything, the guilt factor plus the fact that I can apply the points to something more meaningful makes it so that it might be time to move on from Entertainment Weekly.

If I do, will the decision be permanent?  I don’t know. One thing that might bring me back, if I do give up my subscription, is that I don’t want to get stuck in ‘my generation’ when it comes to pop culture.  I don’t want to be one of those people that listens to nothing but 90’s music and talks about how terrible movies are today compared to what they were ‘in my day’.  If I find myself drifting too far back to that, I might just have to pull myself out of that trap, but for now, I might be able to go without.

Readers, what do you think?  Is it time to pull the plug on Entertainment Weekly?  How do you rate yourself in terms of pop culture knowledge and how has that changed as you’ve aged?

Copyright 2014 Original content authorized only to appear on Money Beagle. Please subscribe via RSS, follow me on Twitter, Facebook, or receive e-mail updates. Thank you for reading.

Two Fools Brings Tipping Back Into Question

This past week, one of the most buzzed stories in the sports world came about when LeSean McCoy, running back for the Philadelphia Eagles, was called out publicly for leaving a 20 cent tip on a $61.56 bill.  The restaurant owner attempted to call out McCoy by posting a copy of his bill on the restaurant Facebook feed.

Now, depending on how you look at it, both McCoy and the restaurant owner are under fire.

McCoy, one of the premier players in the NFL, makes an annual salary of $9,000,000 per year.  He claimed that the service was poor, something that the restaurant owner disputes.  Nonetheless, as many have pointed out, even poor service should receive a modest tip given the low wages that wait staff made.

It reminds me of the lyrics from a song by one of my favorite 90’s rock bands, Live.

“Come on, baby
Leave some change behind.
She was a b**ch
But good enough
To leave  some change
Everybody’s good enough
For some change”

My thoughts is that they are both wrong:

Regardless of whether McCoy makes $9,000,000 per year or $9,000, leaving a twenty cent tip is just inexcusable.  I’ve been in situations where I’ve had lousy service, and in those cases, you can reduce the tip, but I’d leave 10% as a minimum.  That still provides for something, but it sends the message that something was wrong.  I’ve also learned that if things are unsatisfactory, it’s advisable to speak to the manager (or owner) and more often than not, things will be corrected.  McCoy made no such effort, and instead spoke up passively, making himself look bad in the process.

At the same time, the restaurant owner had no business posting a copy of the receipt showing the photo of the receipt.  That was in very bad taste, and to me, showed that he was just doing so in hopes of getting publicity.  If he really was, as he claimed, just trying to support his staff member, he could have posted a generic message on this restaurant’s feed in support of the staff (not mentioning anything that would give McCoy away), or if (as he claimed) he was present and knew that the service was great, he could have given the waiter the $9 or so that he would have gotten with a standard 15% tip.

Instead, Charlie Sheen of all people was the one that came in and offered the waiter $1,000.

I personally think that this was a tale of two idiots and the whole thing could have been avoided with some better judgment on both sides.

But, I guess that wouldn’t be sensational and newsworthy, now, would it?

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Sticker Shock At The Drugstore

This past weekend, my wife and I did something that we’ve talked about doing for years: taking what ended up being a 26 mile bike ride.  We have a good trail system around, and the end of one of the trails takes you all the way up to a nearby city.  We’ve taken the trail a number of times, but have always turned around.  We thought we’d finally give it a shot, so off we went.

It’s a pretty easy ride in terms of being on flat ground that’s covered in gravel (it’s a converted railroad bed), but it still felt good when we pulled into town.  I’m not normally one to undo the benefits of exercise with treats, but given that it was our first time, we thought we might wander into a nearby CVS and get a small treat.

We both love ice cream so we first wandered over to the freezers to look at their single serve ice cream treats.  I thought I was reading things incorrectly when an ice cream sandwich was $3.29.

Nope.  It was right.

A frozen Twix?  $2.99 as were most items.  The cheapest item, an ice cream sandwich type thing was $1.99.  Yikes.

No ice cream.

I started looking around the store, and I was unable to believe my eyes at the prices of things.

I don’t do much shopping in drugstores, but the everyday price of just about…everything…was crazy.

9 volt batteries for over $2.

Individual candy bars for $1.25.

A ten ounce bag of potato chips for $4.

At this point, I wasn’t looking to actually buy, I just wanted to see the prices.

The calamine lotion test

I decided to check things out from another recent experience that kind of acted as a trigger.  A few weeks ago, my son got bit up really bad by mosquitoes.  They like me, but they love him.  He probably had 50-60 bites on his legs and was complaining about itching.

Given that it was around bedtime, my wife ran out to the nearest store, which happened to be a Walgreens, and brought back a bottle (6 ounces) for $5.69.  I thought that seemed high, but whatever.

My wife mentioned it to her sister, who said that she had also gotten some that week, but had purchased hers at WalMart…and it was $2.19.

Astounding difference

So, while my wife and I were walking around CVS, I figured I’d see what their price was, if they were also 250% or so higher.

As it turns out, they weren’t.  They were over 300% higher.

Their price was $6.99.

My jaw just about hit the floor.

We ended up escaping with what I think was the cheapest items sold in the store, a couple of bags of generic gummy bears/worms.

On my way out, I noticed the area behind the counter that used to house cigarettes, which they just discontinued selling last week.  One of the things always mentioned since CVS announced this decision to stop selling smokes, is that they made over $1 billion in profit from them.

I commented to my wife that they must have decided to look to make up the lost profits by jacking up the prices of everything else.

I suppose there probably are deals to be found in drugstores, but my guess is that you have to take advantage of sales and coupons to actually walk away with any type of savings.  But if you pay full price at the drugstore, prepare to be gouged.

Copyright 2014 Original content authorized only to appear on Money Beagle. Please subscribe via RSS, follow me on Twitter, Facebook, or receive e-mail updates. Thank you for reading.

Are Cheeseburgers Worth As Much As Babies?

I have been reading a lot about the protests going on, apparently throughout the United States, where fast food workers want to make a minimum of $15 per hour.  Last week here in Detroit, a bunch of workers protested, and 25-30 got arrested after they took to the streets…literally, by blocking traffic on major thoroughfares during the morning rush hour.

I have to be perfectly blunt on where I stand with this issue, and it’s not at all with the workers.  Before you paint me as some heartless scumbag, let me outline my reasons.

  1. You lost me when you shut down traffic – If workers wanted to gather and demonstrate to get media attention, fine.  But when they shut down traffic, sorry, you lost me.  The people whom they were blocking traffic for were regular people just trying to get to their jobs.  And, the demonstrators made it so that they couldn’t.  Innocent people with no skin in the game became collateral damage to those looking to make a point that could have been made without negatively affecting other people.  I equate this to people in traffic that pull out in front of other people before traffic clears, because they don’t want to wait a spot.  You shouldn’t make your problem other people’s problem.
  2. A real world comparison – Somebody I know worked at a day care facility taking care of a room full of toddler age children.  She worked there for seven years and was barely making $11 per hour.  She left that job to go to one that paid closer to $15, which she got only after negotiating.  Sorry, but you’ll never convince me that taking care of children all day, being instrumental in their development, and overseeing their well being for a huge chunk of their young lives is worthy of less compensation than working in a fast food environment.
  3. The market does not and can not bear $15 – If fast food companies could not find enough qualified people to work at lower wages, then the wages would go up. Pure and simple.  But, since they can find plenty of applicants to work at lower wages, free market theory indicates that there’s no rational economic reason for $15 to be paid.
  4. Paying $15 would mean job losses – Simple cause and effect tells me this: If fast food minimum wages went up to $15, prices would go up.  If prices go up, people would buy less fast food.  If people bought less fast food, restaurants would close.  If restaurants close, workers lose their job.  Bottom line, there’s no way the market could simply absorb these costs without a portion of workers going from what they make today to zero.
  5. No company has a responsibility to provide employees with a standard of living – The basic premise behind the $15 number is that the current minimum wage is not high enough for a worker to support themselves.  I don’t dispute that.  In fact, simple math tells me it’s true.  But, where is it the responsibility of the fast food companies to provide this?  Call me heartless, but the fact of the matter is that any company is expected to provide fair wages for the work performed.  That’s what I get.  While it so happens that I do make enough to support my family, what if that changed?  What if there was an illness and we couldn’t afford treatment on my salary?  Do I have a right to march in and demand more money?  Of course not.  What if my wife and I decided to take after the Duggan’s and shoot for 19 kids?  Would I go into my bosses office after each birth and demand a raise?  No.  That’s silly.

The point is that while $10 per hour (roughly the minimum wage) is peanuts compared to some of the costs, I don’t think that simply demanding an industry specific artificial prop is the answer.  There are other ways that each person has to work through and take personal responsibility for making the decisions about:

  • Reduce expenses – I’d be interested to see how many of the protesters have smart phones with high data plans with which they go to social media to propegate their ’cause’.
  • Side hustle – There are other ways to make money when you’re not at work.  Cut grass, shovel snow, clean windows, write a blog, or any other number of things.
  • Second jobs – When I hear stories about my parents and grandparents generations, there are multiple stories of people who worked multiple jobs.  It’s hard, it can be grueling, but it’s what people have done when the first job isn’t enough.

Personally, I hearken the whole thing to the Occupy Wall Street movement of a few years ago, as the common theme is trying to take ones problems and project them to others in order to gain a solution, rather than working the solution themselves.  I just can’t get behind that especially when it involves, you know, blocking traffic.

Readers, what do you think about the whole uprising going on for $15 per hour wages?

 

Copyright 2014 Original content authorized only to appear on Money Beagle. Please subscribe via RSS, follow me on Twitter, Facebook, or receive e-mail updates. Thank you for reading.

Now That Was A Great Camping Trip

We go camping a few times each summer, and take two week long trips per summer.  This has been the third season of our camping adventures since we purchased our travel trailer.

One of our trips each summer has been to Ludington State Park on Lake Michigan on the west side of our great state of Michigan.  The park is one of the most popular parks in the state, as it is big, has two great beaches, is in a great tourist area, and has some great sites.  You can book six months in advance, and making reservations is like getting tickets to a Taylor Swift concert, if you’re a few minutes past when the sites become available, you’re not getting one.

Until this year, the park has been somewhat of a bittersweet travel.  In 2012, it was our first big camping trip.  I was still very raw in dealing with the camper, so when a big thunderstorm blew in off the lake and damaged my awning, I was almost ready to sell the camper and find something else to do (it was made worse by the fact that for the two days that the awning was unusable, it was over 100 degrees and we had no shade).  Last year, the weather was cold for a good portion of the trip, and we were on what had to be the two sandiest sites in the park (last year, my in-laws joined us as they also purchased a camping trailer).

Even with all that, we’ve had fun, but this year when we booked we wondered what would come our way this year.  Turns out, it was nothing but awesomeness!

We arrived on Saturday, 8/22 and left on Sunday, 8/31.  Initially, the weather forecast had us thinking we might get a day or two at the beach as well as hopefully a trip down the river (more on that).  As it turns out, we did much better!

Saturday – It was hot and humid when we were setting up.  We were in a part of the park that had no trees, so it was definitely not fun setting up, but I prefer hot over cold so I just drank water and took breaks while getting things setup.  The biggest obstacle, and it was more of a laugh than anything else, is that the path that leads to the bathrooms was no longer where it was listed on the map…it’d been right between our site and my in-laws site.  Still, we got to say hi to lots of people throughout the trip, so it worked out just fine.  As soon as we were finished, the sun went over the trees and it cooled off, making things perfect for a great evening.

Sunday – It was forecast to be warm and sunny, and it did not disappoint.  We took the kids down to Lake Michigan and were there all day.  The kids had a blast in the water and sand, and you couldn’t ask for a better day at Lake Michigan.

Monday – Early last summer, we all bought tubes to go down the river that sort of connects the two lakes (there’s an inland lake with the river that runs for a mile or so into Lake Michigan).  Last year was too cold for us to all go, but this year was just fine, and the kids had a blast riding along with us.

Tuesday – The morning started off nice and sunny, so we figured we’d hit the beach on Lake Michigan again.  By the time we got down there, it got a little chilly.  While we all had fun, the time was cut short when it started getting breezy.

Wednesday – It was a little cooler (low 70’s) but bright and sunny, so we went over to the inland lake, which has a great beach with very little walking to get there.  On cooler days, this beach is better since there’s not as much breeze, little waves, and the water is a bit warmer.  The kids played until they dropped.

Thursday – It was a repeat of Wednesday so we tried it again and it worked.  We’d now doubled our number of expected beach days!

Friday – The day was cool and cloudy, so we drove into a nearby town.  We all found some fun t-shirts and had a great meal at a restaurant I’d previously been down on, but that we decided to give a second chance to.  Well worth the try as they redeemed themselves….for now!

Saturday – It was my 40th birthday and it was a great day.  My parents drove up to surprise me, which was truly awesome and completely made my day.  The weather was not cooperative, as the big winds blowing off the lake that day meant that while we tried the beach, it did not last for more than 10 minutes before we reversed course.  My parents had booked a room at a nearby hotel, and offered that we could take the kids to use the pool.  They loved the idea and I spent about two hours in the water with them, and they had a great time.  Later we had Mexican food for dinner, and my favorite cake for dessert.  It could not have been a better birthday.

Sunday – It was time to leave.  Packing up saw no problems and we got home in just over five hours, which is a good drive time for the 260 miles or so.  The kids both crashed within five minutes of being put down at bedtime…and so did we!

In between all that, we got in some campfires, some great bike rides, walks, a sunset or two, and just about everything else you could wish for.  If anybody ever questioned why I liked camping, I would point to this trip as it contained just about every reason of what makes a camping trip special.

Copyright 2014 Original content authorized only to appear on Money Beagle. Please subscribe via RSS, follow me on Twitter, Facebook, or receive e-mail updates. Thank you for reading.