Yesterday I was at the grocery store watching the green cookies that two weeks ago were pink and it got me to thinking ... you can tell time by grocery store cookies.

Valentine's Day = heart shaped cookies with pink or white icing, with red, pink, or white sprinkles

St. Patrick's Day = shamrocks with kelly green icing

Easter = purple and yellow egg cookies or yellow chick cookies

Mother's Day = generic flower or rose cookie with red icing

Father's Day... nothing, unless those cookies were made of bacon

4th of July - stars or circle shapes in red, white and blue icing.

Cookie drought over the summer and fall, until...

Halloween - pumpkin or cat with orange or chocolate icing

Thanksgiving - "harvest-y" gold and orange circles

Christmas - big daddy of cookie holidays. Red, white and green circles, wreathes, bells.

New Year's - Christmas cookies 20% off.

Making me hungry!

Saving log - $0
Spending log - $0

You have to wonder whether astrology actually worked on Feb 12, 1809 - both Abraham Lincoln and Charles Darwin were born today 200 years ago within a couple of hours of each other. Most of us in the United States think that Lincoln's birthday was the bigger deal, Darwin's less so. Not me - as a former scientist, Darwin is definitely the bigger deal.

Not to mention that I could celebrate Darwin's birthday in a unique Seattle way: The

Saving log - $5 tip box
Spending log - $15 groceries

Did a little chore with the change of year - I changed all of my financial passwords. It means that I mostly try to change them only once per year, but its better than not changing them at all. And I have to change all of them. If I have to ask the question, "old one, or new?" its a failure.

Saving log - $2 tip box
Spending log - $0

Don't get too excited about the no spend day - yesterday I bought a couple of bottles of prosecco for New Year's Eve. ($30)

I've seen other bloggers post up their goals for 2009. A beginning of the year goal/resolution then see at the end of the year whether I achieved it doesn't particularly work well for me. And its a rare person who is inspired or motivated in January...

I do have two long term goals:

1. Be wiser in general with my money, which means adjust appropriately to the situation.

This year I realized in April that to pay less in tax, I should put more in the 403B and see if I can take the drop in the paycheck. My expectation was that interest would be high(er) and my stocks would go up. Didn't happen, but since stocks went down, the Roth conversion made sense.

I was pleased at how my original 60% bond and cash/40% stock held up. New 403B money is now allocated at 90% stock/ 10% bond. The new stuff added to the old stuff is working well, I've nearly caught up to my August high.

I do have to make money decisions a bit faster. I shouldn't have waited for t-bills to go to 0% before I finally moved them out. Oh well, better to make a good decision a bit slow than to compound rash decisions.

2. Buy a house in a couple of years.

I rent, but I am interested in buying on my terms. My general plan is to use 80K as a downpayment and get a 120K mortgage, which is about 2.5x my salary.

Yes, I know that there is no way (yet) that I will get a 200K house in North Seattle. I plan, unfortunately, on a severe recession in 2009 - 2010 to depress prices. I have the basic plan, the credit score, the location ... now its patience. In the meantime, I plan to be an observer at open houses, collect internet resources and become a total expert of the neighborhood. Watch and learn.

Buying a house might not ever happen, at $925/month rent for us is pretty sweet and a lot hinges on my success - keeping a job, the misery of others. Light years away, maybe, but its a star to sail to.

Saving log - $2 tip box
Spending log - $19 groceries

Found an interesting article about

If only it really weren't a brilliant

Thursday
Saving log - $0
Spending log - $12 lunch

Friday
Saving log - $6 tip box
Spending log - $9 groceries

We put the finishing touches on our "Vault of Eternity", did a little work, set up for the potluck, toured and took snaps of the other floors (the fear floor was very good - each cubicle had a fear), ate at the potluck, did a little work, voted for the favorites (of course it was us), cleaned up and broke down the decorations, did what I really wanted to get done that day.

Not a bad day until I found out that Studs Terkel died. RIP, Studs. Even twenty five years ago in Chicago, when I saw him perform in the red-checked shirt, he seemed old to my then teenage eyes. I learned from him that if you really embrace what you are, the name can't hurt you. One of the young college Republicans at the time called him a socialist. "Of course I'm a pinko socialist," he roared. "What's your point?"

Substitute "frugal" "cheap" or "thrifty" for socialist. Of course I am...what's your point?

Saving log - $2 tip box
Spending log - $12 lunch

SWOTs are a kind of old school brainstorming technique. I'm going to brainstorm here a bit and apply the answers to my investing and financial plan.

S - Strengths - strong cash position; patience; somewhat diversified (403B, IRA, Roth, taxable, cash equivalents, individual stock); no outstanding credit; still have a job w/benefits including health insurance and a bus pass; ability to save; can live cheap; good health; stable relationships; optimism & gratitude; ability to think and learn; a taste for being contrarian.

W - Weaknesses - emotion (unless you're Vulcan, you have that problem); my investments already have a lot of moving parts; need to experience things to learn them; a taste for risk; tendency to cheerlead and weigh positive info more strongly than negative info; incomplete analysis; too much/incoherent data; being contrary by itself is not a good enough reason to do things.

O - Opportunities - stocks are dropping to levels that I can afford; real estate is beginning to drop to levels that I can afford.

T - Threats - macro economic uncertainty (deflation, inflation, stagflation, hyper-inflation - do I have all the -flations?); political uncertainty; will I have a job?; mis-timing how low asset prices can go (they can keep dropping); as I buy, I tie up money that I'll need for other things.

Saving log - $0 tip box
Spending log - $25 lunch (chipped in for a birthday lunch)

I don't know Julie Tuesday, but she was quite the philosopher today.


I was in a training session, so I didn't see the 778 pt stock market drop until I clicked into the news this afternoon.

That the bailout failed really didn't surprise me - the extreme left and the extreme right didn't like it, the partisanship on both sides is (and was) so poisonous that no one voting for it would get any cover. A Rep voting for it would be accused of raising taxes like a Dem, a Dem voting for it would be accused of caving in to Reps and everyone voting for it would be accused of believing a lie. Its what GWBush over-estimating the case of getting into war w/ Iraq did. If you lie once, you could lie again. Everything is now a possible over-estimate ... are we now into an economic apocalyse - or not?

I do think we are now in a first phase of very steep patch of

So part of the grand plan is to temporarily stop the short selling of 799 stocks. And actually its not just the US that is regulating it; several other European exchanges have also temporarily stopped it, while China doesn't allow it in the first place.

Probably that alone caused my financial stock to nearly double from its low last month (11.10$ low/ 29.50$ yesterday).

Shorting a stock is reversing the order buying, owning and selling a stock. When you are long, you try to buy shares for a low price, hold it for a bit, then sell for a higher price. When you are short, you borrow the shares from a broker at a higher price, then arrange a time for when you will actually buy and deliver the stock. You hope that the stock will be lower by the time you have to buy it.

Shorting is useful - the main use is to add liquidity. Short sellers, like long sellers, actually have to buy the stock (at the end, not at the beginning), which means more buyers. Liquidity is a fancy way of describing that with those extra buyers stocks get traded more often and at more price points.

Another use is that short sellers are good markers for risk. Short selling is much more risky. A stock can only go down to zero, but can theoretically go up to any price. And if the stock goes up (to any price), the short seller has to buy it, losing much, much moolah. Stocks that attract short sellers should tip everybody off that something risky is happening.

Without the short sellers and only the long sellers, stocks of course can rise higher - only the optimists are allowed to trade. But what if the risks aren't quite as well defined and there are no optimists to be had? Stocks then drop in a much more sickening fashion - you can find an optimist if the price is low enough. Without liquidity, sometimes it has to be very, very low.

We'll see over the next few weeks what happens. Offhand it sounds like the "cure" is worse than the disease.

Tomorrow will make fiscal history on Wall Street. Lehman Brothers will declare bankruptcy; Merrill Lynch will be bought out by Bank of America.

How this credit crisis is unraveling is unprecedented by the non-tin hats among us.

The asteroid has fallen, the dinosaurs are fighting or gasping their last. Its up to the mice to find their safe, deep holes and wait things out.

At work today.


The first few anniversaries we had a couple of minutes of silence - the minutes turned shorter and shorter. Today no minutes at all.

Its our nature to forget just a little bit. Its really not forgetting, but easing our memories into something more workable. You can't be white hot furious at that historical moment forever - emotion has to turn into determination. And we can't be too hard on the 7 year olds who can't share our memories. I remember my elders being furious at me for not remembering the Kennedy assassination; and they themselves upset their elders for not remembering Pearl Harbor.

Saving log - $3 tip box
Spending log - $9 lunch + $1 apple + $6 for me and a co worker

I was walking to my bus when I stopped to look at a purse, and thought how great that purse was, how I would look with it slung over my shoulder, how I wanted it.

And I had my Paris handbag already slung over my shoulder! Nothing wrong with my handbag, its still clean, I got a lot of compliments on it, at black and white it goes with anything, it cost me just 30 euros (when the euro dollar exchange was only outlandish and not frighteningly outlandish). Best of all, I still have my memories of buying it, and happy memories of using it.

What is it about the mind that it wants and wants even though you already have and that having is more than adequate?

I'm still thinking about the fact that our cushmobile, MILs 17 yr old white buick, still gets 29 mpg, has working power windows, power seat adjustment, crush velour comfortable seats, carpeting looks great... only the cassette tape player is busted. MIL bought a new burgundy-red Caddy, same size, heads up display (which confuses her so she doesn't use), leather seats, does the math on how long you can last on a tank of gas. Sure, new, equally large, some features not so useful ... but only 15 mpg. And the car is at least 50K.

Tyranny of the new, maybe? Did the math and figured that folks would whisper if she drove around in a (then) 15 yr old car?

I don't see the progress here. Progress if you have nothing and get something; progress if you buy 30K of improvements and technology. Not progress buying into the brand - Buick vs. Caddy; not progress if the new costs more to operate than the old.

Saving log - $0 tip box
Spending log - $.50 coffee + free lunch/coffee + $1.50 (3 bananas)

The day is done. Tomorrow is the first day of vacation, which will be taken up entirely by laundry, cleaning the house, and packing.

But wait. I sat in the back of the bus on my route home, zoning out, listening to tunes, avoiding eye contact and ignoring children misbehavior, all while scanning the bus placards.

Now bus placards are a class specific medium - you see the usual, devoted to the stereotypes of bus riders - the cheap and the poor. Tonight there was the Jobdango placard for the un- and underemployed, the change the world placard for the idealistic underemployed just out of college, the don't-be-an-ass-on-the-bus placards in matching English and Spanish, the alternate forms of transportation placards (on the not-in-your-car bus? Try the not-in-your-car train/amtrak, or even try the not-in-your-car car - the Zipcar). All well and good. The Moneytree payday loan placard fit right in.

But what do I spy? I blinked again.

A condo ad. Interesting. But it gets better. Said condo advertises studios and alcoves(?) for 200K, 1BD/1BA for 300K, 2BD/2BA for 400K, and work lofts for 500K. Notice the irony here? When the buyer shows up and signs and initials, signs and initials, and finally is asked "how did you find out about this condo" is anybody going to really say ... bus placard?

Sure.

I do love the fact that they are brazen about the prices. None of this old "prices start at xxxK" to lure you in before you are horribly trapped at the realtor. Brownie points for that. Just a glam upper class placard proudly slumming with the lower and middle.

The piece de la resistance was: the glam condo was a 1/2 placard. Pulling the punch a bit. I can't imagine that even a full size placard costs all that much. If you are selling a series of 1/2 million dollar anything, along with a larger series of slightly cheaper apartments aren't we talking about 30-40 M worth of construction? Spring for the full size bus placard. You're good for it ... if you sell one.

Its almost as if the glam placard is destined to do exactly the opposite of what advertising supposed to: no one swayed by it could do anything about it or would admit to having seen it, and there is the strong possibility that the developers are sending signals that they will have to drop the price.

Saturday
Saving log - $0 tip box + $35 drp
Spending log - $15 brunch/coffee + $12 produce

Sunday
Saving log - $0 tip box
Spending log - $3.25 coffee & bagel + $4 latte & cookie

This morning we stopped into our local Sunday coffeehouse, expecting a fairly quiet coffee and Sunday newspaper reading. People were swinging from the rafters! We asked what was up ...

Owner: We got refugees from the Tully's Coffee across the street (87th/Greenwood). They closed.

Us: Huh? That was quick.

And it was quick - Wednesday nothing was amiss. The notice went up on Thursday. By Saturday they were closed. By Sunday, you can see the newspaper shroud along all the windows. About as fast as the Alaska Deli downtown...although at Tully's least there was a note.

There seems to be a spectra of closure styles.

You have the never-ending closure style of the Oriental rug stores in Pioneer Square. It wouldn't surprise me if those stores have only two signs - an Everything Must Go Sign and a Grand Opening sign - and the owner flips a coin to determine which one they put up for the month.

You have the political statement closure: a news-worthy proprietor who is retiring or the rent's going up. I call it a political closure because it usually takes several months with some local ain't-it-a-shame or shed-a-light-on-other-issues press. I lump the Starbucks closures in that category. Anybody go to that Starbucks on Dexter and Aurora? Its on the list.

You have the clear must get out by the end of the month sale and closure. My CD place was one of those. Burn off as much inventory in that last month as you can, with the goal of leaving only dirty carpet on the first.

To me, the oddballs are the really quick closures. Last year, the Denny's in Ballard closed with incredible speed and no particular warning. One Saturday we ate there, the next Saturday that Denny's sign was down, and the place was boarded up. Now this Tully's. Perhaps it makes a little bit of sense when a multi-branch company does it - they move the inventory out within a few hours, leaving cricket chirps behind.

But the Alaska Deli? Still a mystery - it was in the midst of construction, but it had been in the midst for a month or two, it was clearly marked Open with clear sidewalks. Frankly, with all the construction guys swarming around it should have been doing the business of its life. May 30, it was selling coffee; June 2 the door was locked. The extra mystery is that the Alaska Deli's stock is still mostly there even now. (this pic was taken in early July)


I'm probably reading too much into these quick closures. But a business has some sort of relationship with its neighborhood, and its customers. Do these quick closures tell us that we don't care or that we might care too much?

Yowsa! Over 500,000 visits!

Seriously, folks, you all need a hobby!

Every so often the question comes up. Do you pick up change from the street?

And the pros and cons come up which boil down to this. Pro: the money's risk free; con: my time is precious, and by G*d, I'm not the type of person who picks up pennies from the street. In case you couldn't tell by the subject line, I'm a pro change picker upper. I know I won't convert a con change picker upper people but I do want to provide a little food for thought.

First of all, you have to be in the right position to even pick up change from the street. If you are already in the right position, you're already un-American. You can't be in a car. You have to be on a sidewalk or in a lobby, walking. You can't be on a cellphone. You shouldn't be pacing and staring off into middle distance, listening. You have to be on a sidewalk, & basically unproductive - not doing deals, not selling something, not ordering someone around. If you're just walking, so much for your time being precious; might just as well train your eye searching for little metal circles.

Second of all, do you pick up change in other aspects of your life? Change that collects in the bottom of the washer/dryer when it fell out of your pants? You pick that up. Change on the carpet of your car that you tossed in your hurry pulling out of the drive thru? You'll pick that up, sure, especially if there's a toll involved. Change that you sucked up in the vacuum bag? Nasty, but you'd rescue it. Change between the couch cushions? You'd pick that up. Matter of fact, isn't that the first place you look for pizza and laundry money?

Here's a news flash. Picking up change from any of those sources, some even nastier than the sidewalk, doesn't change your net worth one iota. Its money you already have that you've moved into your pants pocket from an alternate pocket. Sidewalk change is new money.

Lastly, there's the I-make x-dollars-per-second-its-not-worth-it argument. That only works if your pay is docked when you pick up change. Otherwise, if you find change at night or on the weekend, your pay that hour is $0. Picking up the coin means your pay is $0 plus coin. If you find the coin during lunch and you are making a salary, you pay that hour is $salary plus coin. Think of it as a tip for being alert.

I don't have any reason to convert a non-change picker upper into a change picker upper. Why make competition? Change that you pick up means change I won't. All I ask of you is this: if you see sidewalk money, point it out to me. I'll pick it up.

Saving log - $7 tip box
Spending log - $1.19 coffee + $9 lunch

And rant week continues. Coffee in the bathroom, wide loads on the bus, finding out offically from the IRS that I'll get my fiscal package stimulated. I'd better check the calendar ... yeah, "its" a bit late, so I'm the throes. Actually its not a bad rant, its karmically kinda funny when you think about it.

It all started after lunch at my hideout in the Pike Place Market. I bought a large apple in one of the high market produce stalls, a strategy to keep me from hitting the candy bars during afternoon snack time. The apple came to .95. I gave the seller a buck and told him to keep the change. "Sure wish it was 5 bucks," he said, a little wistfully.

So 5 cents down

I walked along back to work and in the middle of a block found 2 pennies on the sidewalk. I walked to the corner and saw a homeless guy with a cardboard sign. Hey, the only change I had was the 2 pennies, so I gave them to him. At least I tried. He gave them back and started to rant at me! Yeah, I know, 2 "crummy" pennies and I while I do joke about coin rescue..I mean really, I thought you needed money, bud! You didn't even have to pick them up.

So 2 cents up

Tonight I managed to pull out my cloth bag in the Safeway in time to replace a plastic one for a bag credit.

3 cents up, and karmically even.

Saving log - $3 tip box
Spending log - $1.19 coffee, milk + $9 lunch

Payday. Yippie. I depressed myself by playing around with Inflation Master program on my PDA. My first job out of college in 1985 I made the princely sum of 22K. In 2007 22K had inflated to 42K, just a bit less than what I make now. Economists talk about the stuff anybody at any income level can buy (straight or with credit) and how you can get so much better stuff nowadays versus olden times, but I feel like the Red Queen - running in place to keep in same spot.

I know the saying "be careful what you wish for, you might just get it", but man, a deflation spiral looks really good right now. It does really cause an economy to fall apart - why buy something now when you can get it cheaper later? And you can wait and wait and wait far longer than a business that needs money to provide a good or a service can wait for you to spend. Would be nice not to run, for a few months at least.

Saving log - $4 tip box
Spending log - $1.19 coffee, milk + $18 lunch

Lots of changes happening to our lunch group. Finnish friend and his partner are moving to Memphis, screenwriter friend is changing jobs - he'll be working across the street from lawyer friend and I. We had the dim sum lunch for Finnish friend and paid for it.

After lunch, I watched as lawyer friend checked the money in his ancient, broken down, falling-apart, held-together-by-the -cloth in the pocket, brown wallet. "You know, when I was in the Paris Flea Market I was very tempted to buy you a new wallet," I said.

And I was, but I thought better of it. I didn't even buy wallets for my DH, or rather, I have in the past, but I knew that unless the guy bought it, he wasn't going to use it. Even if it was the perfect size, perfect color, had the perfect number and type of pocket...even if it was exactly the same as the old wallet, except that it was new...probably wouldn't be used. The guy has to buy his own wallet, and it has to be a situation where any wallet is better than the old one.

Of course when you get a new wallet, you have to configure it - figure out which pocket gets what card, whether you fold the money and receipts, what order the money goes in. And since the new wallet is going to be a lot stiffer than the old one, the pockets are hard to use. I think that's the real hassle of the new wallet - new wallet, new configuration, lots of tinkering to get the maximal ease of use.

Took a look at the flyer on this house:



I admit, it is not the best picture of the place, but I was shocked at the price -
$499,950. Here's why...

Classic rule of thumb #1: Mortgages should be in the range of 2 - 2.5X yearly income with a 20% down payment. Even with a 100K down payment, leaving 400K to mortgage, would you know of anyone who has 100K in a savings account and a salary of 150K who would want this place? Especially since even a decent lick of paint on the fence would cost about 50$...putting you at exactly 500K.

Okay, okay, you say...the flyer said that it would be a decent rental property. 3 bedrooms, 1.5 baths, on a very busy arterial. It leads me to --

Classic rule of thumb #2: Price shouldn't exceed 100x the monthly rent. To make money on this property if you paid 500K, it would mean you would have to charge 5K/month to break even. You could rent out all the bedrooms each for $1.67K/month. Know of three people stable enough, dumb enough, and willing enough to each rent a room for 1.67K/month?

I'll be the first to admit that I've taken a none-too-flattering picture and know nothing about the inside of the place. Any bets that the inside would be the Taj Mahal? But applying some misty dusty rules nothing pencils in.

I first started my blog to journal my experiences with inheritance and probate (defined here as the process by which the will is discharged) after my dad’s death in July 2005. It seems as good a time as any to use this as a nice little summary of the whole shebang and of my blog in general, especially in 2005 and 2006. Enjoy the walk down memory lane!

1. Someone died because of it. Sounds like a smart-ass thing to say, but it’s true. Someone who you’d much prefer to be alive has died, you’re grieving, and now you have to make decisions and sort out many relationships that now will never change. Yeah, like that will be easy! Be thankful for thing 3.

2. Have an updated will. Sister found the will in a file cabinet in the attic after a few hours of searching. We were grateful that dad had one. However, it was 40 years old! Sister and I were mentioned at the end, basically saying at the end of a long list: if everyone else dies, they get it. Well everybody else did die because a lot happens in 40 years. We also knew that we didn’t do always what dad would have wanted, but for that we needed an updated will. The Ouija board just didn’t cut it.

Oh yes, keep the will and other paper assets organized, together, and in a safe place. Sister and I sorted important papers from dreck for a week, sister even longer, and we moved them from a one padlock- secured farmhouse to sister’s house. The lawyer winced a bit when he heard that because you aren’t supposed to move anything, but let’s face it, all it would have taken is a meth addict with a match so we did what we had to do.

3. It takes a long time. Sister and I finally got through it in June 2007, after one extension, for a total of 23 months or nearly two years. In a sense, we were grateful, both because of thing 1, thing 7, thing 9 and because we had plenty of complicated decisions to make. If you spent your inheritance ahead of time through your credit card, beware.

4. You will say to yourself: WTF? Often. Toothless old guys telling us that dad was sitting on fabulous riches – “that land is zoned commercial”, supposed adults driving farm equipment away for “safekeeping”, property lines 10 feet from where they were supposed to be, finding grandpa’s tax returns from 1970 to his death in 1999, sister having a completely different childhood in the same house than I did, finding out that the estate had insurance for vandalism.

5. The executor’s job is that of a switchboard - to collect assets, taxes and debts, then to discharge all in the most efficient way possible. Really don’t have any good story about this point. Just that if the executor is a family member and is part of the emotional mix that no good can come of it. It was the one advantage of the 40 year old will – all of the family members picked to be executors were unable to do it.

6. Debts first, then assets. One of the first things that the executor did was put in a call for creditors on the estate in the local newspaper. The deadline depends on the state; in ours (Wisconsin) the deceased’s creditors have 90 days to come out of the woodwork. 91 days, tough. Creditors are paid from the estate’s assets, what’s left is what you inherit. Your children or your inheritors don’t inherit debt, with one exception: co-signers. If you need another reason why co-signing a loan is awful, here it is.

7. Probate might be resolving more than one estate or relationship. We also resolved mom’s insurance assets, gave items to dad’s sisters, found residual savings bonds that grandpa gave to us, paid off Nut (a hired hand of dad’s from the 1980s) some back wages that he claimed he had, and I got closer to my sister. Frankly, I’m glad there was only the two of us.

8. Both emotion and analysis have their place. Sister was close to the action, and far more emotional. I was 3000 miles away and had to be dispassionate and analytical. Or was that really the case? When it came to all the assets, I would have sold them to the highest bidder because I attached negative emotions to them, while sister saw the usefulness in picking and choosing the buyer and keeping at least the old homestead. We could keep the homestead, pay for it, and improve it, so why not? In the end, I was glad that her analysis and emotion ruled the day.

9. Stuff is harder to deal with than money. Old farm equipment, furniture, dishes, vinyl records, books, clippings from the newspaper, farm cats, and clothing from the 60s: all went for pennies on the dollar. And while real estate is where the value of the estate was, it was the hardest of all to deal with. Are you sure that you want to collect that much stuff? Who are you storing it for? When you think about it, we are all renters, marking our place on this earth. Enjoy what is yours now and enjoy it completely: you can’t take it with you.

10. It’s now your asset. That’s what I think the whole point of probate is. Because it takes forever, it gives you time to chase away the emotion and the ghosts, and gives you the ability to get comfortable with whatever you are inheriting. At the end, you want it to end.

Tuesday
Saving log - $1 tip box
Spending log - $3 coffee

Wednesday
Saving log - $0 tip box
Spending log - $0

Attended a workplace all staff retreat with breakfast coffee and lunch provided, so I managed to have a no spend day today. Yesterday I brought a lunch and I knew that I would have a no spend day the next day so I splurged and had the delicious $3 drip coffee. Averaged out over two days, its just a bit more than my usual.

The retreat was interesting as these things went. I had a minor epiphany during the retreat with the concept that relationships usually succeed or fail gradually, then suddenly. It came from a Hemmingway character, when asked how he became bankrupt, said, "gradually, then suddenly."

The speaker at the retreat generalized it to all relationships, but since this is a financial blog, I much prefer to keep it in its original setting. How many of us got into serious debt gradually (through denial), then suddenly?

For the bloggers here wrestling with their debts, please remember that denial is a powerful, long lasting emotion. It makes the gradualness of your financial situation so easy to take ... much easier to take than facing the sharp shock of reality. And who among us remembers exactly all of the items we got into debt over? Wonderful or necessary, it doesn't matter - only the denial remains.

All of us savers, though, saved our money gradually, then suddenly. Compound interest is the classic gradually, then suddenly situation. Our 401Ks didn't just magically get big, it took time for most of us to start our 401Ks, decide on the amounts, increase the amounts over time.

Several of the new bloggers here talked about the courage it took us more established bloggers to blog about the mundane. Money management itself is all about the gradual, then the sudden, all about all the little mundane choices to save small amounts consistently over long periods of time, the fact that putting $44 into savings while taking out $40 from the ATM is somehow different, and better than just saving $4.

Right now its all about you all out there discovering the same thing. Try it. Saving will be gradual for a long while, but when it turns sudden, it becomes amazing.

Ten years ago, I had about $15000 worth of credit card debt, and about $10000 worth of student loan debt. Still, while I was frugal, and I was slooowly paying off my debts, I realized that I was missing one ingredient - my routine.

Oh I had one. I'd drive to work, maybe drive to a lunch spot, visit a couple of friends, come back and work, then decompress by driving to the Barnes & Noble and read and have a decaf and a sweet. Yikes! I had a routine, but that routine involved leaking cash.

Routines are one of the most powerful tools that the saver has while non-stop novelties KILL saving. Sure, we all like: fun surprises; dinners out; new things to read, eat, think about; the chance to meet new people and have new experiences. Every once in awhile these things add spice to our lives. But those surprise vacations are often are white elephants when the plane ticket, gas, meals, incidentals are figured in; extra tasty calories allow you to gain weight and trash your credit at the same time; books and media are great to experience, but if you use them only once, well, what do you have? The memory of what your floor used to look like.

A routine is a powerful tool because: (1) you hone your budget to it, (2) you pursue in your routine only the things that are meaningful to you, (3) in assessing your routine you know why those things are important to you, and (4) you've put a price on those things. When the price of some of the elements of your routine goes up, then instead of cursing it, you either find a way to cheapen that element to compensate, or you drop the element entirely.

The first step in developing a routine with an eye toward saving is to write it down. This goes in tandem with you writing down everything you spend. Well, where did you spend your $ and what were you doing? And don't forget the weekends because that's where most of your frivolous spending occurs.

Now that you have your daily and weekend routine. For each of those tasks, what makes it something that you like or you have to do? Work, of course, is a big part of your routine during the week day. You probably have to do it to earn money, so you might like your job or not, but you know why you are doing it.

Another example, a classic in the frugal literature. Maybe you like a cup of coffee on the way to work or the first thing as you get in. How do you feel about this task in your routine? Do you think its a waste? What elements do you like about it?

Now that you have your feelings about your tasks in your routine. How can I maximize a particular task's value?

Take the coffee example. It could be that you love coffee and caffeine. Buy a decent cup of coffee, the cheapest size that you can drink, or if you find that making coffee has value to you, make coffee to take in. It could be that you have coffee with the boss or coffee has value to you because its a way to socialize with spouse or co workers. Time to think about a token order of something cheap(er) so you minimize the cost, but maximize the info you get from spouse or co worker coffee time. Do you finish your coffee? If you don't - time to definitely think about getting the smaller size!

The next step. Are there tasks in your routine that no matter how much you've thought and tried to maximize their value but you find you can't? Drop those completely. Don't spend a dime on those!

The final step. Are there tasks in your routine that even maximized, you can replace with something cheaper? We'll switch examples here with cable, the other great frugal example. Why do you have cable? Like a specific show or sporting event? Afraid that network TV doesn't have enough choices? You can get TV shows from Netflix, Amazon or the public library. You can go a sports bar or a friend's house for the sporting event.

Closing the loop. As you start streamlining your routine, honing your tasks by maximizing all their values, and eliminating spending tasks you don't like, your spending should smooth out.

Start saving!

Piling on from observations written by mom-from-missouri and Dollars for Dough Nuts.

Ever notice that we are called "consumers" rather than "citizens"? Fairly soon we will all be "borrowers" or perhaps "sheep".

Now to straighten out the last weird thing about the farmette (at least for now). Last Saturday, sister gave me a paper grocery bag of envelopes, proclaiming, "I am my father's daughter."

Yikes.

That night, I went through the bag, shucking envelopes like oysters. Many were closed, which was depressing. It turns out that about 40% of it was hers but had nothing to do with the farmette.

I sorted into four piles: statements from our farmette bank account, bills that are clearly farmette, incidental letters and info clearly farmette, sister's items.

I then made an excel workbook with three spreadsheets: costs, deposits, summary statement that linked the total costs and total deposits - the number is black if we are in the black, red if we have more bill than deposit. There were two transactions that I had to correlate with sister's checkbook.

This took me all of 45 minutes. We were in the black, the big assumption being that she put everything in the checkbook and the grocery bag.

"Could you at least get one of those file boxes with the handle? At least its swankier than the grocery bag." I chided.

I extracted a promise that sister would send me the spreadsheet, then tell me the totals of the bills so I update. It'll force her to open the mail. (Drat, I should have saved the spreadsheet on my flash drive.)

Man, that bugs me. Sister's not an accountant, doesn't 10-key, and doesn't do audits, but at least open the mail and tally your bills up with a calculator. I'm trying to figure out what sister's so afraid of. I'm worried that I contributed to it a bit by threatening to cut her off. But if you treat your bills like they are going down a rathole, then I have to assume that my money is going down the same rathole.

Money's complicated, but if you tackle it one thing at a time, its not bad. I was afraid, once, when I had more commitments than money. The first step is being able to face the bad news.

Friday
Saving log - 3$ tip box
Spending log - 1.84$ coffee, milk + 7$ curry

I put $3 in my tip box for a later deposit, and deposited the $95,000 check in the bank. The $3 transaction was more satisfying to me as the $95,000 one. The 3$ transaction was all due to me, the $95,000 was the result of a long road. The proceeds of dad's estate are still unreal to me, as is now my new net worth. What to do with all that money? It would seem that I have an amount to do something good with, but definitely not enough to do nothing with. My ship has come in, all right, but its green sails are still powered by the winds of doubt.

Sister and her partner seem to have a plan for some of sister's share - they are interested in fixing up the farmette and using it as a weekend getaway. I was surprised to find out that sister's partner was especially happy with that, telling me that she found that she can really relax at the farmette. Sister's partner especially surprised me in telling me that sister is the frugal one, the one who trying to curb things, saying "we can't afford that" to projects, and not do everything at once.

But as for me, I'm not so interested in starting a business, have no kids to put through college, no strong desire to pursue holidays, toys, or hobbies. Retirement awaits, sure, but should everything have a 25 year time horizon? And if you don't have a habit for spending, you'll probably save and save and save even when you get into your 60s, all to create even more money for non-existant heirs.

So I think that I'm doing well if I pick up a few dollars worth of quarters or in the case of a Milwaukee parking lot last Sunday, I picked up a stylus for DH's PDA (he loses that hardware a lot).

I'm hopelessly outclassed by sister's partner (DSP). Here's the story.

Sister and I were working on sister's laptop when DSP came by and asked if we would join her in walking the dogs. We said no and continued on with her laptop. FYI - it now starts a lot faster.

Thirty minutes later she comes back and says, "You should have come, it would have paid. Look what I found three steps from the porch."

She unfurled a $50 bill, which we later used at West End Pizza.

And last week she found three twenties and a couple of ones.

I run a coin rescue, DSP runs a bill rescue.

Needed a haircut, a couple of grocery items, and I had to write a check to copay the chiropractor, so I broke down and transferred $100 from the brick and mortar bank savings account - a little buffer against an overdraft fee.

Got a letter from Capital One. They're going to shift my billing cycle backward a few days back to the 16th. No matter, I now don't have any recurring charges on it anyway. I moved the newspaper subscription to the new, WaMu credit card. Sweet justice. I would have had to write a .35 check, but I bought a spare set of bedsheets from Overstock.com. The bill turned into a semi-respectable 50.34$, which I'll pay next week when the paycheck comes in.

Last week I talked with lawyer friend about 403Bs. It turns out that we made similar money moves with our 403B, but for different reasons. I trimmed my stock portfolio a bit and went for cash and bonds because I wanted a bit of safety. 90% stocks is pretty aggressive even during the best of times. I believe that a recession is on its way and I want a bit of ballast for awhile.

Lawyer friend nearly took all of his stocks and put them in the cash money market fund for a different reason. His favorite fund in the 403B, an international one, was eliminated in favor of a different one, which he hated, because of the fee structure. Yeah, so what about that 1.5% fee, lawyer friend ranted, my favorite posted great returns!

My thoughts drifted a bit, and I'm a bit ashamed that I didn't have the heart to explain it to him. Fees are important, and can be in some cases and conditions even more important because fees are inexorable. That fund manager will charge that fee whether that fund has a good year or not. The fee is fine if you're making in the rare instance a 15-20% return (although it means you are making 13.5-18-5% return), not so fine if you are only making 7-8% because you are barely keeping up with inflation, and it just becomes worse and worse - most actively managed accounts don't do as well as an index fund, and you pay for that privilege. Imagine if you lost 20% of your 403B, which often happened right after the dot.com bust. You'd still be charged that fee with the excuse that "imagine if we weren't your manager - your returns would be even worse!"

Fees are so important that there is a story about them. An investor met with a stockbroker to perhaps give him his business. The stockbroker gave him the grand tour, showed the investor how properous the firm was, tried to impress the investor even to the point of going to the slip and showing off the stockbrokers' boats. The investor wondered, "where are the investors' boats?" Fees, of course.

Anyway, by that time lawyer friend concluded, "I wish we had more choices." It turns out that lawyer friend's partner could choose up to 650 funds. Hear, hear. At least for me - I figure I could handle it.

Saving log (Friday) - $5 tip box
Spending log (Friday) - 1.84$ coffee, milk + $5 curry lunch + 40$ ATM

I keep my paper financial files on the lean side, just enough to carry in a portable tote. I cleaned the old stuff out. The next step is to shred, but the house shredder is old, delicate, and cheap, only designed to do the casual 3 sheet shredding. I had a more than that, so I had to develop a strategy.

Looking at the papers carefully, I found that I only needed to shred the paper that had my name, address, and account number, and those only occurred on the top third of the paper that I wanted to shred. The rest, a couple of quick rips. It really saves the shredder from getting hot and making that strange grrrry sound when its unhappy.

I took a look at some of my old 403B files. Right now I have about $53K total, fully vested. But at the beginning of:
02, 3K and 20% vested
03, 7K and 40% vested
04, 14K and 60% vested
05, 22K and 80% vested
06, 29K and 80% vested (February 06 was when I got vested)
07, 41K and 100% vested

You never think you get anywhere financially until you look at where you've been.

That reminds me, time to download a few months worth of my monthly statements to my flash drive...