What’s inside? Here are the questions answered in today’s reader mailbag, boiled down to summaries of five or fewer words. Click on the number to jump straight down to the question.
1. Best state retirement investment option
2. Unrealistic expectations
3. Saying no to boss demands
4. Why switch ceiling fan rotation?
5. “Junk drawer” solution?
6. Resetting life balance without spending
7. Scrimping and splurging cycle
8. Taking items from restaurants
9. Collectible card games
10. Pressure cooker?
11. Inexpensive wine?
12. National Novel Writing Month
For the last several years, I’ve kept my hair very short with clippers at home. On occasion, I’ve gone to a barber to trim it nicely for a special event, but I can actually do a solid job with my own clippers while looking in a mirror or just trusting my sense of touch.
For the last few months, though, I’ve let my hair grow longer than usual. I’ve discovered, quite quickly, that I’m not a fan.
First of all, with very short hair, there’s basically zero daily maintenance. I don’t have to brush it or do anything at all with it, really. I don’t have to worry about any hair care supplies, so I spend almost no money or time on it. With longer hair, I have to brush it.
It also takes longer to wash it. If it’s really short, I put a drop of soap on my wash cloth, rub it on my head, rinse it out, and I’m good to go. Now, it needs shampoo or else it feels greasy almost immediately. It takes longer and requires more expense.
Not only that, I just don’t think it looks that great. I guess I’m just much more used to seeing myself with very short hair in the mirror, but to me, I look just weird with longer hair.
Later today, I’m busting out the clippers again. I’m not a fan of this “longer hair” experiment. The frugal side of me, both in terms of time and money, is just too strong in this case.
Q1: Best state retirement investment option
I’m an educator in Idaho, and have contributed to PERSI (state retirement system) for over 16 years. I’m 56 years old. I was a stay at home mom prior to being an educator. I also particpate in PERSI Choice 401K ($500 per month). Many folks tell me PERSI is the best option for me. However, I want to be sure I’m maximizing my retirement dollars since I’m not so young anymore. How do I know if this is the best option for me?
– Terry
According to the information I could find on the PERSI Choice 401(k) program, it’s a pretty solid program with low fees and good investment options. Compared to some of the less-than-stellar 401(k) offerings out there, it’s quite good. Your money is perfectly fine there.
As with any 401(k) plan, your return is going to have much more to do with the specific investments you chose within the 401(k). Since you didn’t mention the investment choice you made, I’ll assume that you chose what your local HR officer recommended. Most choices within a 401(k) plan are just a balancing of risk and reward – the higher the average annual return, the more variable the return is from year to year.
Your real point of comparison would be whether to put that $500 a month into some other investment plan entirely, such as your own personal Roth IRA. The truth is that, if you’re in a solid 401(k) plan like this one and you have reasonable investment choices, both choices are perfectly reasonable. To make any kind of real comparison, you’d have to start comparing very specific fees between your specific Choice 401(k) investments and investments you might choose in a Roth IRA – and the truth is that tax changes and investment variability that you can’t plan for is likely to make far more of a difference.
If I were you, I’d just stick where you are and pay attention to any changes to PERSI Choice 401(k). If you begin to hear a lot about fees going up, then I’d worry about it. For now, you’re in good hands, I think.
Q2: Unrealistic expectations
Whenever I read your site or another money site or book I end up just feeling overwhelmed and depressed. You talk about a life that sounds utterly miserable and unsustainable and if that’s the only way to fix financial problems and build a future then i guess we’re all doomed to endless debt and misery.
– Charlie
I’m not entirely sure where this comes from. My guess is that many articles and books that you read are loaded with hundreds of suggestions for better spending habits or other lifestyle changes and that, as a collective whole, they seem overwhelming.
Here’s the thing: any time you read about suggested changes to improve your financial state, the goal is to pick and choose among them. There’s no way any list could fit your life and your personal comfort level for change. That’s simply impossible. Everyone has a different life. Everyone has a different internal comfort level for change. Everyone has different things that are simply non-starters in their life.
The purpose of a big long list of changes is to give you a huge menu. Think of it as a restaurant with a twelve page menu. You might order a soup and an entree and a drink from that menu, but you’re not going to order every item on the menu. You’re just going to order a few. The nice thing about a big menu is that there are so many choices that virtually everyone can find a few that they like. It’s not an insistence that you have to eat everything on the menu.
Another factor is that many people never sit back and ask themselves what things they actually care about and won’t skimp on. Instead, they view their current lifestyle as a “firewall” from which any change is uncomfortable and thus not to be considered at all.
Successful personal finance requires introspection. You have to look at your life and recognize that you’re not currently making optimal choices and you have to have a desire to find the actual optimal choices to maximize the value of your life now and the value of your life going forward. That can be hard.
Q3: Saying no to boss demands
I work at a bank and work hourly. My boss often makes us work extra hours and not put them on our time sheet. He sometimes even demands that we come in on our days off to do work and we can’t put it on our time sheet. He has said that if we don’t do it he will find someone who can. I can’t keep doing this because I am having to choose between working unpaid and taking care of my son. How can I say no and keep my job?
– Anna
First of all, off the clock work is usually illegal and can result in the business receiving some pretty harsh penalties from the Department of Labor if they’re caught doing so. Such demands are rarely made in written form for just this reason. Here are the details on the illegality of off the clock work.
The reality is that if this is done occasionally, nothing will happen to the employer, but if it is done as a matter of course under threat of job loss, you and your coworkers likely have a case against your boss and the business itself that would include unpaid past work.
So, what can you do? First of all, start documenting all of it. Every time you’re requested to do off-the-clock work, write down when the request was made and then the times during which you worked off the clock. Keep a little notebook with all of that in it. Encourage your coworkers to do the same. You need this documentation in order to make a case against your boss. When you collectively have a lot of entries, go see a lawyer together. He or she will guide you as to the next steps according to the laws in your state.
Q4: Why switch ceiling fan rotation?
I’ve seen a bunch of “winterizing” advice that says to switch the rotation of your ceiling fan blades during the winter months. Why? I’m not sure what it achieves.
– Daniel
During the winter, you want the ceiling fan to run at low speed in a clockwise direction. This causes the fan to gently draw room air upward toward the ceiling and push the warm air down and out toward the walls. This causes the warm air near the ceiling to move down toward the floor without the wind chill effect. In other words, you’re distributing warmer air throughout the room without the “chilling” effect of air moving across your skin. Think of it as standing a few steps behind a box fan – you don’t feel much of a breeze there at all.
During the summer, you want that wind chill effect. Thus, you want the fan to run at medium or high speed in a counterclockwise direction. This pushes air downward in the middle of the room and you’ll feel that circulation. Yes, it’s pushing slightly warmer air down from the ceiling, but you get the “wind chill” effect that comes from air moving across your skin, which causes you to feel cooler. That’s why people run a fan in the first place – it doesn’t actually chill the air, but it does make it move and that feels cooler to our bodies.
So, during the winter, you want the air to circulate but you don’t want to feel it, so you run the blades one way. During the summer, you want to feel the air moving around, so you run the blades the other way.
Q5: “Junk drawer” solution?
Do you know of any good solution to the “junk drawer” problem where you just have a drawer with a lot of odds and ends in it and you just go there when you need a random rarely used item like a screwdriver? Everyone seems to have one and they’re always a mess and most of the stuff in there is stuff that never gets used.
– Daniel
The “junk drawer” is basically a place where people stow items that they rarely use but that they typically really need at certain moments. A screwdriver is a perfect example of this – you might go two months without needing a screwdriver, but when you need one, you need one.
I don’t inherently think a “junk drawer” is a bad thing. The only time it becomes bad is when it’s not evaluated every once in a while to determine if the things in there still have a use. Is the drawer filled with chargers for devices that you no longer use? Are there old discount cards or coupons that are expired? Are there dead batteries in there?
We just go through our junk drawers once or twice a year and chuck about a third of the items in there. The rest make sense to continue to keep because we use them.
Q6: Resetting life balance without spending
Every few years I have some kind of “life crisis” where I feel really unhappy with my life. I can sense that feeling coming around again.
I usually respond by making some radical life changes. I usually change jobs. I usually move to a new place and redecorate completely. I often dive into a new hobby and spend a bunch of money on stuff for that hobby.
Those changes usually leave me in a bad financial state. I’ll wake up feeling in control of my life again a few months later and I’ll feel happy, but I’m facing a bunch of credit card debt. I pay it off and then have a good year or two and then the cycle repeats itself.
How can I “reset” my life without doing this?
– Adam
I’ve done this a few times myself. There are a few things that really help.
First, try to involve yourself in new passions that don’t involve spending money on a bunch of stuff. Pretty much any activity that doesn’t require regular purchases will work. My favorite examples of this include reading (which involves getting books from the library) and hiking (which basically just involves walking in free state parks). As long as the hobby doesn’t involve buying endless new things or paying to do something, you’ll be fine. Explore some free hobbies or ones with a very low startup cost.
Second, try actively selling off possessions. If you’re buying a bunch of items to redecorate, that must mean that you’re getting rid of items that you’re currently decorating with. Sell them on Craigslist to generate money for new decorations. Use the same logic when it comes to hobby spending – sell your old hobby stuff when you’re burnt out on that hobby and use that money to fund the change you desire.
Finally, reboot your social circle. Try simply hanging out with new people. You’d be surprised how much of an impact that can have on your sense of “freshness” and “change” in your life.
Q7: Scrimping and splurging cycle
How do you break out of a scrimping and splurging cycle? Like one week I’ll be really proud that I managed to only spend $40 at the grocery store to cover the whole week and then the next week I’ll spend $80 on a meal and drinks with friends. Or I’ll read nothing but library books for three months then go to a bookstore and drop $100 in one shot. It feels like I bounce from one extreme to the other and the spending extreme undoes all of the effort of the other extreme.
– Sarah
It sounds honestly to me like you’re feeding different things here.
Take the meal example. When you spend $40 for a week of groceries, you’re buying food for yourself. When you spend $80 eating out, you’re doing it with friends. What about the books? When you get books from the library, you’re borrowing them with the intent of reading them. When you go to a bookstore, you’re adding to a collection of things that you own.
Rather than questioning whether you’re scrimping too much in some areas of your life, I’d look specifically at your spending mistakes. Do you have social windows in your life where you can enjoy the company of friends without dropping $80 at a restaurant? Can you budget for your book collection, maybe allowing yourself to spend $20 a month adding to your book collection and then mostly just feeding your reading habit at the library?
I find that budgeting for splurges in my life really helps. I set aside a certain amount each month to spend on whatever I want without guilt and that usually covers my hobby expenses. Any other expenses are discussed with my wife.
Q8: Taking items from restaurants
Help me settle a dispute with my dad. Let’s say we stop at a fast food restaurant for lunch. He’ll order one thing off the dollar menu, spending like $1.07, and get a cup of water to drink. Then he’ll take like 40 napkins, put them in his pocket, and take packets of condiments and put them in his pocket too. His argument is that those things are for paying customers and he’s a paying customer. I think it’s so ridiculously cheap that it’s embarrassing. Thoughts?
– Dana
My great grandmother used to have drawers in her house stuffed full of condiment packets and napkins. I even have a few packets of hot sauce in my own drawers. I don’t think he’s particularly unusual in doing this.
Restaurants will provide that stuff while it remains cost effective for them. I’m pretty sure that they’ve figured people like your dad into the calculations. If it ever stops being cost effective, they’ll move to putting one napkin and one condiment packet on each person’s tray or in each person’s bag.
In short, I don’t think your dad is doing something strictly wrong by doing this.
Now, you’re also asking a different question here. It’s not a matter of whether it’s right or wrong, but whether it’s polite to do so. I think that has a lot to do with individual values. Clearly, it’s something that you find impolite and embarrassing and he does not. The question is how you resolve those areas with your father. With my parents, I usually just overlook things like that (in fact, I do that with most people).
Q9: Collectible card games
My oldest son is really getting into the Pokemon card game. It seems really expensive as packs cost $4 each and you just get ten random cards and his desire for new cards seems infinite. Surely there are ways to keep this cheap.
– Maria
Collectible card games like Pokemon and Magic are extremely clever in terms of their pack-based system of acquiring new cards. It simultaneously scratches the collectibility itch and the “gambling” itch in that you might get a very valuable card out of a pack. These cards do have a pretty solid secondary market.
I think the solution in your case is to use this as a teaching moment. Instead of just buying packs for the child, start giving the child a small allowance – a dollar or two a week. If your child wants a new pack, they’ll have to wait a couple of weeks to get another pack. That puts the choice on their shoulders. Are they willing to spend that money on a pack? Can they find ways to find discounted packs (there are discounts to be found). They have to start making real financial decisions.
Not only that, a pack of Pokemon cards makes for a great small gift for a child for a birthday or holiday occasion. In that regard, it’s not too bad of a hobby for a child, though it can end up being expensive if you’re a parent who tends to spoil their child with lots of little purchases. I tend to look at it as a good hobby for learning some self-control.
Q10: Pressure cooker?
Is a pressure cooker a worthwhile purchase? I already have a slow cooker. Trying to figure out if I would get enough value from a pressure cooker.
– Daniel
A pressure cooker has a bunch of potential home uses. However, it’s not a life changer – if you’re not going to use the pressure cooker to save time on those uses, it’s probably not worthwhile to purchase.
For example, do you regularly cook dry rice? Do you regularly cook dry beans? Do you regularly cook root vegetables? Those are items for which a pressure cooker can help you save time. Basically, if you cook anything that takes a very long time to cook and you have a real use for reducing that time (meaning you’re not just using a slow cooker), then a pressure cooker can help. It’s also useful for some types of canning.
If those statements aren’t true, then a pressure cooker quickly becomes a niche item. We have one and we use it about once a month on average and it’s usually for speeding up some recipe. I like it for cooking beans, myself.
Q11: Inexpensive wine?
I’ve been invited to an office dinner party and it was suggested that I bring a bottle of wine. I don’t drink wine regularly. I’ll have a glass of whatever someone offers. So I know nothing about buying it.
My “frugal instinct” (ha ha) is to just buy the cheapest wine, but I want to make a good impression and not bring something that’s laughably cheap. Suggestions?
– Melissa
If I were you, I’d go to the wine section of a mid-level grocery store and ask the person working there for a good low-cost recommendation for your situation. Simply explain your situation – you want a drinkable low cost wine for a dinner party that won’t get a negative response from people. They’re likely to point you to a reasonably well regarded wine that’s on sale, probably after asking you about what kind of meal will be served. If you don’t know, just say that it will be for after-dinner drinking.
Just take their recommendation. They probably won’t push anything on you that would cost more than $10 a bottle, which is a totally reasonable price for a bottle of wine.
At home, when Sarah and I drink a bottle of wine over an appropriate meal, we either drink something very inexpensive from Trader Joe’s (I’d probably not bring “two buck Chuck” – wine from Trader Joe’s – to a dinner party unless you know the people involved) or else something we picked up at a wine tasting from a local winery.
Q12: National Novel Writing Month
Are you participating in National Novel Writing Month? Seems like a good way to get focused on writing a book.
– David
I’ve done it in the past, but not this year. I’m not sure if I will in the future.
For starters, this year is just horrible for those kinds of projects. My wife is getting a masters degree in her spare time and that’s eating up multiple evenings a week where I’m home alone with the kids. That change has changed the balance of housework and parental tasks in our home for a while, which means that although Sarah is the one taking the class, we’re both feeling a real pinch of having much less time flexibility. Writing a novel in a month takes time I just don’t have right now.
Another problem is that when I’ve done this in the past, I haven’t liked the results. I’ve done it four times now. Twice, I felt that the whole thing was awful as soon as I finished and I never even bothered to look at it again. The other two times, I thought that it was decent, but when I went back a few months later to edit it, I thought it was awful. I have really just been unhappy with my output when trying this in the past, for whatever reason.
Maybe I’ll try again in future years, but I’m not doing it this year and I’m not sure it’s a good fit for me in the future.
Got any questions? The best way to ask is to follow me on Facebook and ask questions directly there. I’ll attempt to answer them in a future mailbag (which, by way of full disclosure, may also get re-posted on other websites that pick up my blog). However, I do receive many, many questions per week, so I may not necessarily be able to answer yours.
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