It’s the last day of March and time to recap this month’s discussion of money. I am also including some of my favorite comments from the month and links to other interesting articles.
- We started the month discussing the reasons why you need to learn to manage your own money and suggested readers watch Niall Fergusson’s, “The Ascent of Money.“
- We discussed budgeting, a foundation concept in money management, introduced our fictional family, the Medians, and issued The Ruly Challenge to create or update your household budget.
- We discussed electronic checkbook management options and gave instructions for GnuCash, an open source financial management software.
- We discussed debt management and how to calculate payoff schedules to get rid of your debt.
Ruly Ruth commented:
“[T]here’s a HUGE emotional quotient to analyzing these numbers. The big negative balances and the lengthy payoff times can be emotionally stressful and saddening for many.”
- We walked through a cash-out mortgage refinancing example and explained why sometimes it is more cost effective to pay down your debts as they are rather than using complicated strategies like refinancing.
- We reviewed Howard Schilit’s “Financial Shenanigans” and discussed the accounting tricks you need to be watching out for as an investor.
If you follow Howard Schilit on Twitter, you saw his link to a recent New York Times article indicating that there were some financial shenanigans in the cost estimates for health care reform.
- We talked taxes and gave some organizational hints to help you get your tax papers in order. My taxes are done and currently in the 7-day waiting period I discussed. Once I got into the nitty gritty of my business taxes, I ended up needing to consult with a professional CPA (with the incredibly Southern and accounting-appropriate first name of “Banks”). It would be a wonderful gift to small businesses to enact some tax simplification standards. Currently we treat almost all businesses for tax purposes as though they are Fortune 100 companies.
- We discussed insurance, including what to look for in an insurance quote and how to evaluate the financial strength of an insurer.
- Ruly Ruth discussed the delicate politics of money and marriage.
In a sad trend, The Washington Post ran an article recently profiling the number of spouses who cannot afford to divorce and are currently doing the best they can to tolerate each other living in the same house while they wait for a better economic climate.
- We discussed saving for retirement, particularly through an employer-sponsored 401(k) plan, and the importance of rebalancing and evaluating the administrative costs charged by mutual funds.
If you need an incentive to ramp up your retirement saving, you may be interested to read the recent New York Times article indicating that Social Security goes broke this year and is currently paying out in benefits more than it takes in from payroll taxes–a troubling milestone that wasn’t supposed to be reached until 2016.
I hope the recession is an old fashioned lesson in learning to delay gratification, saving up front before purchasing, checking the fine print on interest rates, so no one ends up in such situations. But mostly, I just hope the recession is ending.
- We jammed to Danny Stewart-Smith’s “See So Clearly,” a song featuring the incredible vocal talents of Evin Gibson and reminding us all that there is more to life than money and possessions.
Mary Mary commented:
Having just made the transition from joblessness and receiving public assistance to being employed with a decent wage, I can definitely relate to the message in this song. My experience made me much more aware of the needless excess we often surround ourselves with, thinking it will bring us peace and happiness. I now understand the true value of life, family, hope and individual strength, none of which you can label with a price tag.
- We discussed the reasons for setting aside some cash in your emergency kit, using examples from the recent Haiti earthquake.
- As a bonus, I shared a budget-friendly recipe for an Americanized version of South African milk tart.
It has been a tough month going through this money discussion. The math was a bit challenging and it was emotionally difficult at times to think about the reality of the recession at an individual level. I hope that you have been enriched by the discussion and that you feel at least a little more in control of your own finances. While money can’t buy happiness, having a sound financial basis is one of the keys to being less stressed and more confident.
On Friday, we start a new month and a new theme! We will be lightening things up a bit for April. Please check back then!