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Smithee Update: Six Months in San Diego

This article was written by in Debt Reduction. 12 comments.


This article is by Consumerism Commentary staff writer Smithee, who is juggling about a dozen clients and creative projects as a freelancer.

It’s been a year since I was laid off and decided to become a full-time freelancer, and it’s been six months since my wife and I made a risky decision to move the family from Dallas to San Diego. Overall, we think moving was the right thing to do, but there are a few things keeping me anxious.

I’m writing this update from the Starbucks near the house we’re renting in San Diego, because Starbucks has air conditioning, and the heat and humidity in the house were too difficult to ignore. The good news is that today is only about the tenth day that it’s been too hot in San Diego since we moved back in April.

Productivity

As I hoped, moving to a place with nice year-round weather has had a good effect on my ambition and productivity levels. Some people like warm weather, but I found that Texas’s six-month-long summers would infect my outlook and attitude, creating tense and downright depressing work relationships.

In addition, working for myself means I can create my own hours and I’m not suffering from road rage or dealing with the rising gas prices. To be fair, though, San Diego’s rush hour is literally only an hour long, which is a level of sensibility I never saw in New Jersey, Seattle, or Dallas.

Most days I even have enough time in the morning to sit down and eat breakfast outside, which is part of my American dream.

San Diego at Night

Moving is expensive

Including fixing up the old house, packing, storing and moving all the stuff, animal medicine and drama, paying an agency to rent out our house in Dallas and $4,600 for the first & last months’ rent plus a security deposit in San Diego, moving wasn’t something we could do with cash on hand. We’ve created over $10,000 in credit card debt for the privilege of living somewhere better, and it almost always seems like the right decision.

Long-time readers might remember that I spent over a decade with thousands in credit card debt, before I finally buckled down and, with the help of a respectful salary, wiped it out over about nine months. I hate credit card debt, and knowing those balances are out there building interest against me causes some anxiety. The silver lining is that the “San Diego debt,” unlikely my legacy solo debt, is something that my wife and I are both contributing toward reducing, so it should go away that much more quickly.

The best part about our move (financially speaking) is that we’re saving at least $200 a month on air conditioning, which is the same amount more that we’re paying for housing. If we didn’t have to spend so much on rent deposits and agencies, it’d basically pay for itself. Over time, it will.

Debt reduction strategy

We’re not really reducing debt in a meaningful way, yet. At the moment, my wife has the big dependable salary. My work sometimes generates large paychecks, but freelance work is not reliable, so I’ve been spending more time finessing and futzing with each month’s household budget instead of putting payments and savings on auto-pilot.

I’ve been using the 50/30/20 guideline, and in the months where I have large freelance income, we’re able to save quite a bit. I know what I’m supposed to do is keep saving until we have three months’ worth of emergency savings available, or put it toward credit card debt and then build emergency savings.

What I want to do is use it to pay off the car loans early. One is on a schedule to expire in January, and the other one in June of next year. They add up to over $1,000 a month, and unlike the credit card debt, they always require the same regular payment amount, or else bad things happen.

In fact, once the car loans (and the old IRS installment) are completely paid off, we could fulfill all of our “needs” (the 50 part of 50/30/20) with just my wife’s salary. If things go the same way they have been, and if there aren’t any expensive emergencies, isn’t it smarter to free up $1,000 a month for saving or debt payments?

That’s the trick, isn’t it? You’re supposed to assume there will be emergencies that require you to have saved up a lot. I’ve never had that much saved in my life, but I’ve also never been hit with a truly expensive emergency, and I am impatient to be out of debt.

Photo: robsettantasei

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Income Infatuation and Online Dating

This article was written by in Featured, People. 103 comments.

This is a guest article by Sam, the author of the blog Financial Samurai and the founder of the Yakezie Challenge and Network. He writes a column for Consumerism Commentary every other Tuesday.

There are 14 income selections one must choose on a particular online dating site my friend Craig recently joined. Take a look at these choices: Under $20,000, $20,000-$30,000, $30,000-$40,000, $40,000-$50,000, more $10,000 increments up to $100,000, $100,000-$150,000, $150,000-$250,000, $250,000-$500,000, $500,000-$1,000,000, and finally $1,000,000+. Wow. Talk about getting granular! Do people really need to know within the $10,000 or $50,000 range of how much one makes? Guess so, otherwise there wouldn’t be so many choices!

Craig is 32 years old, six feet tall and works as a project manager in construction. He doesn’t make a lot of money, with a salary averaging about $55,000 a year. That said, with dark brown hair, a nice smile, four-pack abs and a cheerful persona, he should be considered a catch by many women. Yet, Craig has an inferiority complex. $55,000 is only the fifth choice out of 14 from the income list! He often wonders to himself, How am I supposed to compete with the thousands of other single guys in San Francisco who undoubtedly make much more than me? Earning $55,000 in San Francisco is like earning only $25,000 in Houston.

Income infatuation is strong

Women love to say that it doesn’t matter what car a guy drives, how much he makes, or how much he’s worth. Instead, the gracious woman emphasizes personality, charisma, drive, and integrity! Yet, if this were really the case, why don’t surveys ask a guy to rate his charisma trait between 0 and 14 like they ask about income? Why isn’t there more emphasis on the various types of personalities and ambition levels instead of just one word, yes-or-no answers? The reason is women aren’t telling men the entire truth! High quality literature (like Cosmopolitan magazine) prove that there’s a lot more than meets the eye!

I believe everything is rational, and the 14 point income question is there because women demand it to be there, otherwise it wouldn’t be there! If enough ice cream shop customers demanded double fudge peanut butter cup ice cream with swirls of caramel, you can bet your bottom dollar that they’d find a way to get the flavor on the menu.

Don’t take it from a guy

It’s really easy to see things from a guy’s point of view. After all, I am a guy, so what am I supposed to do, pretend I’m a woman and psychoanalyze myself from a woman’s point of view? Maybe, but there is a better way. The better way is to simply ask women about this ridiculous 14 selection income field.

So I asked Jennifer, a professional woman with ten years’ experience in corporate America the following questions: Should Craig lie and say his income is $175,000 to make him seem more desirable? It’s not like his potential date can really verify how much he makes, especially if he takes her somewhere fancy. Or, should Craig be honest and go with the “love me for who I am” option? I expected Jennifer to choose the latter, and she did.

“Craig should be himself and disclose everything with honesty,” Jennifer says. “What happens if they get serious and she discovers he doesn’t make the $175,000, then what? She’ll start wondering what other lies Craig is telling.”

That’s all fine and dandy, but what does it matter if Craig can’t get a date in the first place since no woman wants to date a 32 year old man in San Francisco earning only $55,000 a year? Craig can’t even get in the door. Wouldn’t it be a better strategy to make him seem as desirable as possible, and allow him to bedazzle her with his charming personality and chivalry instead?

Jennifer smirked, and simply said, “Men.”

What’s a guy to do?

Craig has been on this dating website for over a month now but isn’t getting much luck. He gets several “winks” and messages, but he hasn’t been able to successfully get a woman to go on a date with him yet. He went with Jennifer’s advice and chose the $50,000-$60,000 level. Frankly, Craig is depressed by his bad luck and wants to just give up online dating together.

Every time Craig thinks about lying about his income, he hesitates because women continue to tell him they don’t care about income. Yet, online dating is so full of lies. The five-foot one-inch girl says she’s five-foot three. The slightly overweight guy takes a picture of himself in a black shirt in an upward looking photograph and chooses the “athletic” body type. The list of embellishments goes on and on; it’s as if one is disadvantaged if one doesn’t cheat a little.

Readers, what should Craig do? And consider the opposite situation: if Craig were to make millions each year, should he reveal the figure or pretend like he makes much less? I assure you that Craig is a good guy!

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Rationalizing an Expense By Changing Your Words

This article was written by in People. 13 comments.

As any marketer knows, words have a power beyond their literal meaning. No one knows this more than political marketers, who create campaigns that usurp specific words and ensure their meaning is replaced with some sort of thought the’d like to embed in the public consciousness. This effect isn’t only thrust upon us by marketers; we use words to frame our own actions in ways that minimize any negative aspects.

One specific example of this is the use of the word “invest.” The literal definition of this word is “to put money into (a thing).” There is, however, a connotation or sense that in most cases, “invest” means “to put money into (a thing) with the hope of financial gain.” That’s a more specific, more positive sense, that people who use the word “invest” want to convey.

If you apply for a student loan, you, the lenders, and the schools rationalize going into debt by framing it as an investment in your future earning power. Future income is not the only reason people earn college degrees, but financial people want to express the benefit of an education in financial terms.

When you buy your first house, you will call it, or you likely have called it, an investment, particularly if the purchase costs more than you can handle. With the hope that house prices will rise, considering it an investment convinces others, but more importantly, convinces yourself, that the choice will pay off in the long run.

Car salespeople know this, and will often use the word “invest” when they want to make a sale. There is close to no chance of financial gain when buying a car, but they will use this word because of its positive connotations. If you feel like your making an investment rather than spending money now and committing yourself to spending more money over the next three, five, ten, or more years, you’ll be more likely to part with your money.

It’s more fascinating how we use the word ourselves, though. Rather than buying clothing, one might say “investing in a wardrobe.” There may be some logic to this, if having nicer clothes is a prerequisite to earning more money in your position. In order to advance in your career you should, among other things, dress more like those whose jobs you’d like to have. The idea of “investing in a wardrobe” is used by people who have no such ambitions. For those who do think a set of new suits will be the deciding factor for a promotion, keep in mind spending more than you can afford on clothing is not a guarantee.

There’s always a case for buying quality rather than choosing the most inexpensive option. That’s not the point here; the word “invest” is often used when people spend more than they know they should and want to convince others as well as themselves that they made the right decision from a financial standpoint.

Here are some other items people “invest” in rather than buy when they want to spend more than they should:

  • “Good” furniture. Not too long ago (when considering the age of modern civilization), furniture was built to last generations. Families were less mobile and could easily pass well-built furniture to children for several cycles. It is possible to invest in furniture that could last over a hundred years, suiting the needs of future generations, but that’s unlikely. Most furniture built today will be replaced within the initial owner’s lifetime. The concept of “investing in furniture” no longer applies.
  • Electronics (computers, home theater systems, etc.) Buying the latest and greatest electronics may be a way to invest in your continued relevance within your social circle; if you want to hold the Superbowl parties, you’ll need the biggest, highest-definition, most-dimensional television. That’s as far as you can take investing when a product’s life cycle is only a few years before becoming hopelessly obsolete.
  • Home business scams. Be wary of any product that promises you the ability to earn money on your own — but only if you buy an introductory home business kit, e-book, or some other limited-value item. This will always be framed as an investment but few people earn enough to cover their initial outlay.

See past the marketing and be aware of any self-delusions. Words are powerful, and using the word “invest” instead of “buy” often masks a dangerous financial choice.

Photo: soopahgrover

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Smithee’s Goals for 2010

This article was written by in Planning. 2 comments.

My one goal from the beginning of 2009 was to do at least one creative thing a week. When I thought of it, it seemed pretty ambitious, then I started writing twice a week for this site, and it was automatically taken care of, so any other creative thing I did was just metaphorical gravy. I think I’ll need to bump up that ambition for the next year if I’m going to end up being really proud of the things I create.

I learned some things about myself this past year. Specifically:

  • I’m not terrible at improv theater, even improv comedy, which has had always terrified me
  • I know I’ve always liked performing, but I think I might have that character trait most celebrities have – the one where they don’t feel properly human unless they’re entertaining someone. As far as I know, there’s no cure for this, and I might as well embrace it
  • It’s totally okay for my wife and I to have separate personal projects
  • I will never get rid of this awful credit card debt while I keep buying things to entertain myself
  • The only likely way for me to erase said debt in the next year is to get a second job

Taken all together, the only conclusion I can come to is that in the year MMX, I’ll need to work aggressively to start some kind of entertainment career to combine with my regular day job. Maybe that means voice-over work, maybe it means my own Web series, maybe it means stand-up comedy, I don’t yet know.

If my research into some of my favorite entertainers is accurate, they make do by having multiple sources of income. For instance, not just from selling books of fake text messages to/from the president, but also from doing creativity workshops with corporations. That’s the other big thing I learned this year: you can have different products for different audiences. Seems so obvious now.

So, new goal: publish at least one entertaining thing a week. For my purposes, “publish” means do something where the public can see it.

Next week I’m going to perform in an open mic comedy night. The weekend after that, some friends and I are recreating 15 seconds’ worth of one scene for Star Wars Uncut. Naturally, I’m not getting paid for either of these. But the immediate goal is just to get it out there, build up a portfolio, and show what I can do.

Publishing something every week seems pretty terrifying at the moment, but then again, so did my first few improv classes. Besides, now that we’re living without regular TV service, there do seem to be quite a few more hours available in the week. Might as well fill them with the things that make me feel properly human.

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The Economy Triggers a Rebirth of the Entrepreneurial Spirit

by Debbie

Over the next couple of weeks, six finalists will be auditioning for the opening of “staff writer” at Consumerism Commentary. Each will be providing two guest articles to share with readers. After the six writers have shared their guest articles, readers will have an opportunity to provide feedback before we select the staff writer. This ... Continue reading this article…

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My New Credit Card: Not for Credit

by Smithee

Every Tuesday, Smithee presents an article about his own experiences with credit cards and observations about the credit card industry. Two weeks ago I introduced you to a new credit card that offers 2 percent cash back that is deposited into a brokerage account. Then, a few hours later, I applied for the thing. In my ... Continue reading this article…

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What We Learned by Being Open with Our Friends

by Smithee

I’ve never been squeamish talking about finances with friends and acquaintances (partly, I suspect, because of my lack of an internal dialog filter), but I have learned over time that not everybody else is as comfortable as I am, so I try not to use too many specifics when having financial discussions. However, I think ... Continue reading this article…

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Why I Have No Money

by Smithee

Near the end of my college career there was a sort of “Psychic Fair” on campus. As I recall, nobody charged us anything, so I got a reading from a Numerologist. She basically had me fill out a form with some information about myself. I remember “full name” and “birthdate”, for example. Multiple calculations later, ... Continue reading this article…

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