Solar Update – April 2017

solar-panels

My favorite time of year has come! The days are longer, the snow seems to be gone for good, and birds are chirping on my way to work. Spring is upon us. I’ve always loved spring and summer, but now I have even more reasons to embrace the seasons. No, not just because the kids are out of school and there will be less traffic. Because it’s sun season! As you know, we got some solar panels last summer and we enjoyed many months of free electricity. It was truly a sad day when I had to pay for my first electric bill in months after the start of a frigid winter. These things will spoil you…

But the sun always shine eventually and, boy is it shining! My March 2017 electric bill was $38. We are retiring the heating for the season and thus expecting a much lower utility usage, until late June when we have to kick on the AC. Even then, I’m thinking that the 12-13 hours of sunlight that summers in New England graces us with should be sufficient to offset the worse of the damage. I might have reached the electric bill break even point. If so, I am looking forward to negative balances (I don’t say that very often) for many months to come so I can run my heat for free in November.

Let’s raise our glasses to sunny days, tax credits, and free electricity.

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It takes Luck to be Successful

Don’t mind me; I’m just practicing my click-bait titles…

It is often said that if hard work was the only way to success, day laborers, farmers, etc. would all be millionaires. Hard work is a key to success. No one (except maybe lottery winners) has ever achieved anything in life by sitting around the house doing nothing. Whether it’s Harriet Tubman freeing slaves, Mark Zuckerberg founding Facebook or Obama becoming president, you won’t hear about high achievers sitting on the couch with a lot of free time on their hands.

On the other hand, we shouldn’t be insinuating that anyone who didn’t find great professional or financial success failed to do so because they lacked discipline. Many of those people lacked opportunity, money and some were lazy and poor planners, but some lacked good fortune.

I say luck because many of my peers who came from similar backgrounds as myself are doing very well while others, who didn’t work any less hard are doing terribly or did so terribly that even after being back on their feet are playing catch up.

I want to tell the tales of 3 of my peers, all of whom graduated college within a year of  each other and a year of the Great Recession, eliminating the disparity that graduating during prosperous times would create.

All 3 are women of color, giving them the same likelihood of facing sex and race discrimination in academia and the workforce.

All 3 were traditional students with parental support (albeit to various degrees), no teen pregnancies, criminal past, etc.

While they remain anecdotes, I wanted to provide that small glimpse of their backgrounds to demonstrate that some of the major things that tend to create inequalities were not factors or were the same for all women.

I’ll start with the one that graduated in 2007. That was pre-recession but her lack of meaningful experience limited her opportunity to find full-time employment in time before Sallie Mae came calling. She was a little stubborn about getting internships in her field because they paid less than the temp-jobs she got that were completely unrelated to her major. She eventually found a job a year later after she began managing her salary expectations a little better. She built her savings and got her own apartment. She was no longer living on whatever allowance her parents could spare but she wasn’t living a life of prosperity either. For example, she couldn’t afford a car in any state (new or used) because the added cost of fuel and insurance was too much for her tight budget to bear. Some days she didn’t run the heat to keep utility costs manageable.

A year later, Peer #2 graduates. All is well.  At least for a few months until the market crashes and Lehman goes out of business on a humid august day. It’s pandemonium and lay offs start rolling in. She got to keep her job but it was only a matter of time before she too was offered a severance  package. She takes it, finds a job in retail and applies to graduate school, but she falls behind on her bills. Shortly there after, she lands another, better paying job which offers to pay for her to finish her degree. She says goodbye to retail for good as she graduates, gets promoted and gets married. Her now-husband who also has a good paying job brings in solid additional income that allows them to move to a really nice part of town and she keeps thriving. 8 years after undergrad, she has a happy family life, has a successful career and is financially stable.

Peer #3 is also a 2008 graduate. She’s an outgoing creative woman with a heart of gold. She’s generous to a fault. She’s active and participates in any and all activities that could enrich her undergraduate experience. She had lofty aspirations so she travels internationally and tries to get internships at various prominent organizations. Unfortunately her field of study is narrow and doors are closing fast. Her field is in demand but only for the most seasoned workers. There’s no desire to invest scarce resources into building inexperienced people. She bounces from paid internship to paid internship until things get so bad that she ends up working at the mall, focusing on just making a living since building her resume has done little for her career prospects. As a result of her basic costs (which are relatively low given that she still lives at home), she is unable to make her student loan payments which go into default and double in size after capitalized interest and late fees. 8 years after graduation, she is still making minimum wage and owes more on her student loans than she borrowed.

Next time you see someone struggling, don’t assume that they’ve done everything wrong. It could very well be that the necessary opportunities for success didn’t present themselves.

Living out here has me thinking like a crazy survivalist

I’m a city girl through and through. I can navigate any mass transit system, I have extre road rage, I can walk 2 miles in 45 minutes flat and I’m rude. It doesn’t get any more Boston than that.

But since moving out here to the ‘burbs and living on more than an acre of land, I’ve been harassing my husband about teaching me how to survive in the wilderness, increasing our dry food supply, and getting me in shape in case there is a war. Whatever is in that well water is not agreeing with me and has me talking all kinds of nonsense. I think the fluoride in city water killed all the crazy, so it might pay to move back where my biggest concern can once again go back  to being which side of the road won’t be affected by street cleaning this week.

No One Tells You How They Do It

They will only tell you that they did it.

We all have that secretive side. We grow up valuing privacy & learning not to tip our hand. We are also raised to be ashamed of our mistakes and failures. Letting them define us, damage our self esteem, and allowing people, who were too gutless to even try something new, to be our judges.

This usually means that by the time we hear of a leadership or entrepreneurial  story, it has achieved great success and the less glamorous early history of struggle, rejection, and bad decisions is swept under the rug. This unfortunately sets impossible expectations of instant easy success to observers, and by the time anyone notices, the misleading version  has been told for so long that no one knows the truth anymore. Either that, or the person behind the story likes the version being told and makes no real attempt at correction.

Everyone has a blog when they’re a millionaire or once they’ve retired at 30. No one brings you along for the journey so you can see the struggle of coupon clipping, fighting with your spouse about not buying those shoes or taking that trip. No one tells you about the uncertainty they faced taking on some risky ventures, buying a particular stock or quitting their job. They want to be in the public eye only after they’ve achieved enough success to continuously control the narrative & present the version that shows no set backs. The entrepreneurs only talk about the boost in sales after going viral on twitter. No mention of the sleepless nights because they couldn’t make ends meet. The weight loss journeys are of before and after pictures with no actual journey complete with plateaus and weight gain being documented.

No one wants to take money advice from a broke blogger just like you wouldn’t take advice on how to run a bank from the CEO of Wells Fargo. But there is a difference between telling a story of hope and taking a journey. A journey is a path. Not a destination. Don’t tell people about your sales only after you’ve reached a million. Show them the months you were in the red. Let them know some days no one bought anything from you. Tell them because those who come before you need to know that, overspending once isn’t going to completely derail their early retirement dreams. Tell them so they know that the slow start to their internet business is not an mandatory death sentence. Tell them before they start thinking Rome was built in a day.

Know what you don’t know

It takes a while to figure out the things you don’t know. If we’re lucky, we learn them by observing other people and go into our first experience well prepared. If we are not very lucky, we learn the hard way by making stupid costly mistakes. But those mistakes don’t need to be repeated. We just need to do better going forward and I bet that once your ignorance starts costing you some money, you’ll remember the rules just fine.

Here are somethings I didn’t know, wish I knew and now know:

1) When you’re allowed to deduct your mortgage interest from your taxes, that also includes any points and prepaid interests you paid for the year you bought the property. Not just your subsequent monthly payments.

2) You can negotiate everything with any vendor. Not just the local mom & pop’s.

3) YOu don’t need the extended warranty. The only thing that usually breaks is always the one thing they don’t cover.

4) Insurance preys on our worst frears. Be well insured but be insured to your financial capabilities. You will be grateful for insurance when things go wrong, and trust me they will. However, they go wrong rarely (unless you’re very unlucky), so f you have more than 6 months worth of living expenses, don’t pay more per month on a $300-500 deductible if the $1,000 deductible won’t put you in the poor house. You can afford the deductible and the extra payment to the insurance company can be put to better use.

5) If no one depends on you for their livelihood, don’t buy excessive life insurance. Have enough for your family to settle your estate. A single childless person whose parents are self-sufficient doesn’t need $1 million in coverage. Who are you leaving that money for?

6) Be consistent. It is the key to success. Nothing you will ever do in life will happen instantly. Be consistent and be patient. Results take time.

7) Pick your battles. Not every war is worth fight and some wars have repercussions that last for years. The world is a big place but in networking circles, it’s microscopic.

8) Nothing lasts forever. In good times, prepare for rainy days and in bad times know that it is only temporary. I’ve been through some really tough personal times but I pushed ahead because I knew things would get better. At the same time, I’ve spent all my years since college “stacking chips for rainy days”. While I can’t control everything that happens to me personally, I can control my financial situation through adequate insurance, increasing income, saving and planning ahead.

What wisdom have your years brought you?

You’re on Notice

 

long-term-unemployed

It wasn’t too long ago that I talked about the importance of never getting comfortable with your level or source(s) of income. I’m a big promoter of always seeking different income streams as well as seeing how you can get raises. Your ultimate goal should be to be in control of an amount of income that covers your cost of living. That’s true financial independence. That way, if you continue to work, you are working because you want to and you can stop at any time. Most importantly, if you’re involuntarily out of work, you’re not likely to be homeless in 3 months.

I also talked about my experience using a Bank of America ATM with a remote teller (Teller Asssist), and the potential threat they pose to many retail banking jobs.

Here it is: CNN is reporting that within the next 10 years, 30% of bank jobs could be obsolete. Very alarming.

These are routine repetitive jobs that we could anticipate being replaced. They are customer service jobs that provide an experience as well as a service. Well, I used one of these machines, and I got the experience. The woman on the screen was sufficiently pleasant and helpful for me to not care that we were interacting on camera rather than in person.

Technology has done it: using machines to provide services that could only be delivered in person. If you have a lower skilled job, this should be your wake up call. Save, invest and set yourself free from the bondage of debt. Otherwise, you might find yourself with a negative net worth an no income.

Focus on what you have

why-am-i-depressed

I don’t know if this its a symptom or a cause of a consumerist society, but in wealthy western countries, we spend a significant amount of time thinking about what we don’t have. We constantly compare ourselves to our peers to see if we’re meeting manufactured milestones that carry no weight in measuring our true success.

I was reading the comment section of an article yesterday when I stumbled into a young woman’s comment about how much of a loser she thinks she is. She said she felt worthless relative to her peers because of her perceived lack of success. Her primary reason cited for feeling like a loser is the fact that she still lived at home. At the ripe old age of, wait for it… 25. TWENTY-FIVE! That’s how old she is. And that’s why she feels like a loser. She went on to say that all her friends have nice apartments and she was the only one who lived with her parents.

Leaving the nest at a young age is a relatively recent American phenomenon. It is not uncommon for first generation immigrants to live at home until they are married. It also was not uncommon for it to be that way with American kids before going away for college became popular. In fact, if we go back even 100 years, I would say that multi-generational families were not uncommon either. So why is it that this thing that we started doing less than 50 years ago is now considered a deciding marker of success?

I’m not encouraging anyone to be 40 and still mooch off mom and dad. However, if you’re 3 years out of college, with no kids and no spouse, what’s wrong with going back home to get a temporary boost? 70% college student graduates with $29,000 in student loan debts and the average starting salary for new graduates is $45,000. I don’t think it makes anyone who wants to have food security and a roof over their head a “loser” when they’re in that financial situation. And we know what average means for the people in that group. It means that many new graduates have more debt and a lower starting salary than what’s listed here.

We spend so much time worrying about our perception of other people, at least the perception they want us to have, that we can’t see the forest for the trees. This young lady doesn’t know her friends’ financial situations. She sees the apartment she doesn’t have and assumes she’s a loser. Does she know how often her friend is left with $7 after paying rent? Does she know how much credit card debt that friend has? Does she know if that friend is able to save for retirement? When it comes to money, we see what they want us to see. We don’t see the reality. Often times, the reality is grim. Very grim. (More on that in a later post.)

Additionally, why isn’t she grateful that she even has parents who are able to give her a place to stay? Some people’s parents are so financially strapped that moving back home wouldn’t even be an option. She also didn’t complain about her relationships with her parents. Maybe that’s not what bothers her the most. Maybe she has a great relationship with them. We don’t know. But since she didn’t mention it, we’ll assume it’s fine. Why isn’t she grateful for that?

She didn’t say she was unemployed. What I gathered from her comment was that she was working but didn’t make enough; at least, not enough to move out. I empathize. But her fortunes are still greater than her problems.

She’s a college graduate (Bachelor’s Degree). That makes her more educated than 70% of the American population.

She has parents who can subsidize her.

She has a job.

She lives in the richest country in the world.

She’s not homeless and made no mention of food insecurity.

This is not intended to dismiss her problems. Rather, I am encouraging her and anyone who is in a similar situation to focus on their blessings rather than their misfortune. Your only focus on your problems should be how you’re going to solve them. Not how sad you are that you can’t live alone in an overpriced apartment filled with Ikea furniture.