Financial Reference

I tend to be more concerned about day to day fluctuations in the market than Brian does. I can’t help but be happy when all of our stocks are up and a little upset as things go down.

Brian used to have all of our portfolio information on yahoo, so at the end of everyday there would be a green or red number at the bottom displaying our gains or losses for the day. Unfortunately it was much too easy to check everyday or several times a day how we were doing. Now, since retirement is still decades away, the day to day fluctuations really mean nothing at all. Seeing how this was affecting me, he removed much of the information, though I still know what stocks we own.

Obviously I can still figure out rough estimates for the day, if I wanted to put the time into estimating, but I rarely know from day to day the value of our net worth. I would say that it’s made me calmer about Brian’s investment strategies. And if I want to know what our net worth is, I can check a spreadsheet on his computer, or ask him.

The past month in the market has been rather tumultuous - the timing of which couldn’t have been worse for me. I’ve been placed on bedrest for approximately 10 weeks (3 weeks down, 7 more to go) so I have even more time to kill. I’ve been trying hard not to follow the markets too closely.

But it’s fair to say that money has beeen on my mind throughout this bedrest experience. I’m still waiting for my short term disability claim to be approved (or denied) and I’m attempting to work remotely 20 hours a week, which has been a challenge in and of itself.

In the end I just remind myself that there is a reason that Brian manages our investments, in that he has the interest and knowledge of the subject while I find it rather dull and that the short term really doesn’t matter..

I have this vision for my bedroom - brown walls, white molding, hardwood floors, custom made curtains (made by myself), beautiful light fixture…

Of course, this is the product of watching too much HGTV, TLC, and the occassional decorating/house flipping show on Discover. It’s a problem. Every show has some gorgeous finished product that I would love to have in my own home. It wouldn’t really improve my life, but these show always lead you to believe that you’ll be calmer, more organized, a better hostess…

I painted by bedroom over the past couple of weeks and I’m in the midst of a quilt that will complete the bedding portion of the vision. However, all the other improvements would take large capital investments. I tend to be cheap (let’s say frugal) and Brian’s frugality makes me look like a spendthrift, which means that the larger projects won’t be happening any time soon… or ever.

Of course, I try to internally justify home improvement projects by thinking of increased value of our house. Surely putting hardwood floors in the bedrooms or tile floors in the bathrooms would improve the overall presentation our house would make when we sell it. But then there’s the question of when, if ever, we are going to sell our house. The home improvement shows would tell you that if you put in a $10,000 deck, you’ve increased the value of the property by $20,0000 - instant profit. Of course, some of the profit comes from doing the work yourself.

Then there’s the enjoyment that I would get from having a perfectly decorated bedroom. When I’m honest with myself, I think about the piles of clean and not so clean clothes that are always scattered all over the bedroom, the layer of dog hair that even a twice a week vacuuming regimen wouldn’t contain and toddler that tears through the room without regard for anything fragile (which is why there is nothing fragile in the room, or any other room in the house).

In theory I should stop watching these shows, but in the end, I’m sure I won’t. There’s nothing wrong with ideas. As long as the price tag stays reasonable.

I’ve struggled a lot lately with trying to decide what time is worth and how to spend it. I’ve looked at the MSN calculator and discovered (as depressing as it was) that with the time I put in outside of standard work hours, I made about $8/hour last year.

The additional time was a combination of overtime (unpaid, of course, since I’m an exempt employee) and the time spent trying to get my creditials so that I can keep my job. Now that I have a new job, I have very little overtime requirement (if any) but I still have to study – which works out to an additiona 15-20 hours a week, year round.

Eventually all the additional studying will pay off; I realize that. But for right now, it’s frustrating to have the very helpful calculator tell me that I could be making more working at Target. Of course, the calculator isn’t taking into account that there are future rewards built into the additional time I put in now, and that as soon as I stop studying, I’ll be putting in 1/3 less time on the average week.

Between Brian and I, we have roughly 5 jobs. We both work normal full time jobs, a partner and I have a wedding photography business, Brian teaches two nights a week at a community college (although this one is over in a couple of months) and then he manages money for a couple of his friends.

Which leaves just enough time in the day to play with our son for a couple of hours in th evening and get about 7 hours of sleep at night. We’re busy.

Not to say that there aren’t hours that are wasted – we still find plenty of time to get our money’s worth out of our netflix subscription. I still manage to lose a little money every week playing poker, and Brian still manages to keep up on most major sporting events.

In the end, we’re really just trying to reach our employment goals. We’d both love to be self-employed (separately – we’ve tried working together before). I’d love to find a job that I can mainly do from home. We’re trying to remember that though the we might not be making a lot on an hourly basis right now, we’re building a good foundation for later.

Brian and I both have decent sized incomes and, before we merged our finances, I was really into using quicken (updated every other day or so) and paid my credit card bills weekly (a little complusive, I know). I was into it. I was all about being financially responsible. Other than a few (or not so few) dvds that I had the habit of buying, I saved the rest of my money and had just a little student loan (at 3.75%) when we decided to merge our income streams.

And now? I have no idea about any of it, and I’m okay with that. I couldn’t tell you when our bills are due or which credit cards we’ve used to finance things at 0% or which card we use to pay daycare. I stay out of it.

Why? It’s not because Brian makes more money, though he does.

I think that it stems from the fact that he had more of a plan for our financial future, while I just had some vague notion that I needed to save a lot and keep out of debt.

Brian, on the other hand, had a good idea of when he wanted to retire, what sort of funds needs to be available for that, and a better idea of what to do with the money in the meantime other than let it sit in a savings account.

This isn’t to say that we’ve agreed on everything. I didn’t even want to merge our finances at the beginning – nor have we ever really agreed on our level of risk tolerance, though I think we’ve made some big strides towards a happier middle ground.

I tend to be more emotional about money matters – to me, money means security.

Brian tends to have a more objective view of the whole financial situation.

So after many arguments about it, I’ve let go, for the most part. I still check in on our investment account and I love to watch my 401(k) grow. And the money that’s earmarked for our son is in my name, though Brian picked the funds for that as well.

I do, however, have some idea of where to find the financial information, if I wanted to. There are spreadsheets on his computer and a couple of drawers in the desk that have the majority of the papers. And every once in a while I ask for an update on where we’re at.

It works for us, for the most part. I’ve gotten over the fact that someone else can see every purchase I make, but that shouldn’t stop me from making them (within reason) and I think he’s gotten to the point where he doesn’t need to question every small purchase.

It works for us.

I was driving home this evening and happened to pass a gas station that was overflowing with cars (mainly SUVs) to the point that I wondered if I should call Brian and see if there was gas shortage and that I too should join the masses and fill up my tank.

Being that I had our son in the car, I chose to drive pass the backup of mainly bright, shiney, new SUVs and head home, despite the fact that I was down to a ¼ tank.

I did happen to glance in my rear view mirror and check the price: $2.49. Up until that point I had been ignoring the gas prices figuring that I’d fill up tomorrow when the tank was much closer to empty.

Naturally, figuring that some gas crisis was on hand (which is the logical conclusion to jump to… for someone that tends to overreact to just about everything) I noticed that the next gas station was no where near as full. Actually, there weren’t any cars at the next station. Because… well, I can only assume that it’s because the next station had prices of $2.66.

I know. It’s more. It’s $0.17/gallon more. It’s 6.8% more.

I’m all for frugality when it’s justified. But spending five to ten minutes waiting to fill up the tank (and it would have taken that long at a station with six pump and at least 10 people waiting spilling out onto the business street) is a little absurd.

We’re building a house. Actually, we’re building The House. This is the one that we plan on raising our son in and growing old in. We plan on staying there long enough to make planting trees a worthwhile endeavor and our son’s handprints will be put in the driveway.

We’re trying to plan for 20 years worth of contingencies. Which means that while we might not need an extra bedroom right now, where would we want it to be if the need arises. And while the basement won’t be finished right away, we’re planning on finishing it someday and everything needs to be in the right place for that to happen.

It’s not the most financially responsible thing that we’ve ever done. Talking to my mother about the way we’re taking out a bedroom to make a sitting room in the master bedroom, she said “you need to think about resale value” and I was able to say that I wasn’t planning on caring one bit about resale value. This will, hopefully, be it for us.

But there’s a slew of other financial considerations.

For our current place, we got a 3 year arm mortgage. It kept the payments down and we really weren’t planning on staying here any longer than that. Now we’re learning the ins and outs of construction loans and locking in rates and all the fun stuff that goes along with that. Unfortunately lendingtree.com doesn’t handle construction loans so we’re left to the mercy of the salespeople at our local banks.

Then, of course, there’s the price. It’s well over what we were planning on spending when we started looking, although it’s still affordable. I have my days in which the massive amount of the mortgage overwhelms me a bit.

I think that the one thing that makes us pause every once in a while is that this is the first time we’ve ever had conspicuous consumption. It’s a pricy place. It looks like a pricy place. People will know that we have more than most people our age. And we’re not used to that.

We drive cars that are several years old. Our current place in nice, but cozy. I tend to wear name brand clothes, but I make no secret of the fact that my mother takes me shopping whenever I see her and foots the bill. I can count the number of toys we’ve bought our son on one hand (the grandparents are responsible for the massive pile of toys that take up half our living room). We don’t eat out all that often; I take my lunch to work. We don’t have any expensive hobbies – even when Brian plays golf it’s at a public course 99% of the time.

A few people know that we have substantial savings. My business partner realizes that Brian and I were able to fund our start up without blinking an eye.

So to think that everyone will know, is going to be a bit weird for us. But we’ll get used to it. And that’s not why we’re building it. We’re doing it because we want our son to have a place to grow up, and I want to finally unpack all the boxes because I will have found a place to call home and, as Brian said,

“What else are we saving all this money for?”

And because it’s going to be perfect. Absolutely perfect.

Brian is working on another project today, so I’ll be writing in his place. I’m been his wife for six months, but his financial partner for almost two years.

Brian has recently accepted a job teaching high school math at a public school. Though he has no formal training in education, he can take this position since he has enrolled in an accreditation program.

Needless to say, I had some strong feelings about him taking this position. And it wasn’t all about the money.

The pay, when we add up all the changes, is actually not that much different that what he was making part time. We’ll be saving $1800 year in health insurance premiums, he’ll have the summers off, which cuts out $3000 in daycare expenses and he’ll have time to start his own business, which, hopefully, we’ll lead to a lot more income in the future.

It’s going to give him a lot more time. He’ll have the summers to spend with our son; he’ll have a shorter workday so he’ll have more time in the mornings and afternoon. He has a shorter commute.

All in all, he’s going to come out way ahead in the deal.

It’s taken me a lot longer to accept that as a family, we should come out ahead too.

I was hung up, not on the paycut, but on the lack of potential future earning. Teachers in the public school system are paid based on a grid – there’s no additional raises or bonuses available. He also is giving bonus that would have come in March, some ESPP options that would have come at the end of the year, and a raise that would have taken affect in January.

It’s not an insignificant amount when you add it all up.

But it’s that age old question, “what is time worth?” How much is happiness worth? If this is the right fit for him, how much money should it take to keep him from it? Should any amount of money keep him from it? How much should my opinion and money issues be taken into account?

In the end, he promises me that we wouldn’t have to worry about money, that I would still have the flexibility to keep my job options open and that this is truly what he wants to do with his life.

Maybe I am jealous that he’s escaping the cubical culture. Maybe I want to have summers and spring break. Maybe I want the larger paychecks and bonus potential.

But I’m willing to give up some of my financial insecurities and love of a large balance in our checking account, happiness is worth a lot.