The Good News, The Bad News, And The Funny News

The good news is that I got the job. The bad news is that my new paycheck will be 65% of my current one. This is actually a little better than I first feared, because I was bracing for a 50% paycut. The funny news is that my monthly takehome pay will actually be about the same as in my current job.

How does a 35% reduction become no loss at all? It's not fuzzy math, I promise. Right now, I max out my 401(k) and save just under $2,000 a month. Not counting these two deductions, which I never see or touch for living expenses, my annual after-tax income is about $49,000. In my new job I am not eligible to contribute to a 401(k), and I will not be saving any of my salary--Shiner and I plan to live off my salary and save his after we get married. Ta da! Annual income of $48,270--that's not counting the $5,000 I'll put toward a Roth IRA. And just like that, the pay cut disappears.

Well, not really. My retirement savings will feel the hit. Our savings won't grow as fast as they could if I weren't seizing this professional opportunity. But it makes me more comfortable with the pay cut to know that it won't affect our standard of living any more than we want it too, and I won't feel like a mooch like I was afraid I would.

Marrying Debt

This post has been a long time coming. Yesterday morning Shiner e-mailed me to tell me that he'd just sent his stimulus check to his American Express, and that the balance on that card was now below $7,500. To understand how huge this is, I need to give you a little background.

Back before we decided to get married, I knew Shiner had credit card debt. He knew that I had none. From what he said about it, I guessed he had about $10,000 in debt--not a small amount, but not paralyzing. I knew he was sending payments beyond his minimums to try to pay it down. He knew it was important to me that he was doing that. And I trusted that he had it pretty well in hand.

So we decided to get married. And it was great. We didn't tell our parents or our friends right away, we just kept it to ourselves for a little bit, and savored the fact that we had this exciting, fantastic secret. And then we decided to pay for the wedding ourselves, so we start talking about possible dates and budgets and how much we could save each month and how all those pieces fit together. How about Fall 2008? Yes, Fall of 2008 would be lovely. I've always had a thing for fall, anyway.

And I told him I really wanted his credit card debt gone by the time we got married, that I thought he can do it, and we should account for that in setting realistic saving targets. OK, he said.

Except when he added up his credit card debt, it was nearly $42,000.

I needed it to sink in, too. $42,000.

He'd never done the math before. That was more than his annual gross salary. I was aghast. I felt blindsided. I felt pissed off. I told him we couldn't set a date. I couldn't set a date. I grew up in a fantastically debt-averse household. I am a debt Puritan. I couldn't live the way he'd been living for the past few years. Whether he realized it or not, he'd gone off the deep end and I wasn't going to legally hitch my wagon to his until he'd come back from the precipice, and until I trusted that he would not inch back up on it again after we got married. It felt like financial infidelity, even though his accounts were all still his and my accounts were all still mine. It wasn't as though he'd been deliberately deceiving me, that was just a side effect of having been deceiving himself. I still loved him, still wanted to marry him, but all of a sudden I didn't feel like I could trust him not to drag me into a hole with him. And that lack of trust is a pretty good sign that we shouldn't get married quite yet.

So then all of a sudden we weren't getting married. Not in the foreseeable future, anyway. Certainly not by Fall 2008. Maybe not for a couple of years. Who knows? If he wasn't able or--more scary, willing--to rejigger his financial life, maybe never. It was so awful. I remember very little of the specifics because I basically zoned out of my life. I took at least two mental health days, days when I just couldn't drag myself to work. I think Shiner felt even worse, though. He was like the walking dead. Remember, we still hadn't told our families or our friends, so neither of us had anyone we felt comfortable talking to about the situation. I alternated between wanting to comfort him and resenting that he'd been such a bonehead about it in the first place. The guy went to school for accounting! How could he not get that he was spending way more money than he had? Did he not care?

Not setting a date was tough on me, but it was killing Shiner. God love him, while I was being a logical, self-preserving hardass, he just wanted to get maaaarriiiied. A couple of days after the big reveal, he came up with a plan, hoping to get me confident enough in him and his financial committment to set a date. His plan basically involved spending nothing, cashing in all of his investments, getting a second job, opening a couple of zero-percent balance transfer cards, and working like a damn dog to pay off his two high-interest, high-balance cards by the end of 2008 so we could get married in January 2009. It was going to be tight, but it was theoretically possible.

We made some tweaks (I wasn't about to let him cash out the tiny amount he had in his retirement account for my benefit--not when the whole point was for us to be old and doddering together), and he went into action. I stayed anxious, but was slightly optimistic. I could tell his heart was in the right place, but I was worried about his follow through. I decided I was OK with setting a date and making some plans, but I was also only putting down deposits I was willing to forfeit if Shiner didn't follow through and I had to call the whole thing off. I knew he wouldn't be able to pay everything off by the time we got married. That was, and is, simply too steep a hil for such a short period of time. But if he could pay off the two high-interest cards, he'd owe a third of what he started out with and would have worked his ass off in the process. I don't need perfection. Working his ass off was good enough to prove to me that he knew it was serious. We could tackled the rest together.

Shiner has been too embarassed for me to blog about this before, and I have respected that. But I think he's surprised himself with the numbers, and is so proud of himself he's told me I can blog about his debt now. I think he wants me to blog about it.

So what's the status update? Shiner has:

paid off the Chase (at 29.78%!!!!) with his second balance transfer, back in early December.

knocked down the Am Ex balance to $7,453 (at 15.98%)

a $5,248 balance on his Citi card, on a 0% offer that expires in October '09

a $7,064 balance on his Discover card, on a 0% offer. He can keep that 0% rate indefinitely so long as he makes two purchases a month at the normal interest rate, so he's been buying two packs of gum per month to minimize the interest charges

...for a total credit card debt of $19,765.

Compared with his original balance of $41,935, that is phenomenal progress--a 53% reduction in less than six months! In a follow-up post I'll describe how he's done it and how the realization that I am "marrying debt" has affected my approach to money, debt, and us.

Spending Money to Save Money (and Health): My CSA

It's springtime, which means that along with opening my windows and pumping up my bike tires, I have once again written a $320 dollar check for--well, I'm not exactly sure.

I know in general terms. It's my CSA, which is short for "community supported agriculture." It's a program that lets consumers buy a subscription to a local farm for a growing season. The farm uses those up-front payments for its seasonal startup costs, and then as crops are harvested, all the CSA members get a regular portion of the harvest. The idea is that by running the program on a subscription model, the members are not only supporting local, sustainable farming, but they share some of the risk and benefit of farming--if there are droughts or floods or infestations, the members get less produce, and if growing conditions are ideal, they get much more. But this means I don't know exactly what I'll get for my $320. Will the peppers fail this year? Will slugs destroy the tomatoes? Will I be eating butternut squash into the winter (I hope so)? Will they plant those delicious raspberries again? WIll I ever figure out what to do with burdock? It's an exciting world of possibilities.

This is my fourth year as a CSA member, and my third as a member with this farm. There are a number of reasons I love my CSA. Some of them are hippy-dippy and not at all financial. I like that I am supporting a local business, I like that I get vegetables and fruit that three years ago I couldn't have identified on the grocery shelf, I like that it helps me eat "in season" because the CSA harvest changes weekly as growing conditions change.

But there are financial reasons, as well. Shiner and I split our share with another couple because in the peak season, there is simply too much produce for either of our families to eat before the next shipment arrives. So for $320 we get fresh, organic, local produce for twenty weeks. I may occasionally buy additional produce at the farmer's market if I'm doing something special like canning a large batch of tomato sauce, but otherwise this provides all our summertime produce for $16 per week. That's all the produce we would normally eat, plus more. Our veggie intake definitely increases during the CSA subscription because it seems like such a sin to let beautiful, delicious food we've already paid for go to waste. I might be able to go to the grocery store and buy the same amount of produce at the same price or slightly cheaper, but not the picked-yesterday fresh, organically grown, locally produced, super-flavorful heirloom varieties I get through the CSA. Very frequently, I'd spend closer to $20 or $25 per week on produce during peak season. And with food expenses going up as quickly as they have been lately, the CSA is not just delicious, it's a twenty-week hedge against inflation. Since Shiner and I don't eat much meat, this makes up a large portion of our grocery expenses.

It's very convenient for us to get the food. The boxes are delivered to various drop sites around the metro area. My friend bikes right past our drop site on her way home from work, and later that day I stop by their house to collect our share. A coworker is in a CSA that delivers his share to his home--that beats s trip to the grocery store for sure.

$320 is not a small cost to front, but at this point it's not an unexpected one for me. During the darkest part of winter, when I most miss the warm weather and my fresh produce, I start setting aside money for my share of the subscription. My farm also allows monthly autodebits for households on tighter budgets, and accepts food stamps. It might not be too late for you to find a CSA program near you. Local Harvest lets you search by zip code or state. Maybe a CSA makes sense for youe household, too.

This post was featured in the Carnival of Personal Finance #150, hosted by Lazy Man And Money.

Mommy On The Clock

The UK paper The Guardian recently ran a piece about a trend among US-companies to allow new parents to bring their babies (up to crawling age) in to the office with them. The thought appears to be that it's cheaper than maternity leave. The article is delightfully toungue-in-cheek, with this lede setting the tone:

The United States and Australia are the only two countries in the industrialised world that don't have paid statutory maternity leave (there are exceptions in some US states). At least in Australia, though, your job is protected for a year; in America, even the leave protection only lasts for 12 weeks. It's an astonishingly backward state of affairs, like discovering that France doesn't have a postal service. A Harvard Study of 168 countries, measuring how different governments meet the needs of working families, found the US to be in the bottom five. But rather than do anything so tedious as campaign for reasonable terms, American lobbyists have instead thought more laterally, with a softly, softly, looky-after-baby approach: bring your baby to work with you. Until it can crawl, it can think of your workplace as liberty hall.

The contributing reporters bring their children to work with them and document their utter failure to accomplish anything they're being paid to do. And it understandable that it would be difficult to engage fully in a task while also being primarily responsible for the every need of a needy little being. But these are the darkly comical situations we find ourselves in here in a country that has an singularly bass-ackwards approach to parenthood and parental leave.

When "Help" = "Money"

The first normal conversation I had with my parents after telling them I was getting married (because telling one's parents that one is getting married is presumably not a normal conversation) started with my dad asking how they could help. "By listening to me bitch about gouging caterers and guest list drama" was my first suggestion. But as it turns out, he meant "let's talk about how much money you want from us."

Ditto Shiner's mom. His first trip up to see her after the big announcement happened when I was at work late, but by his report she was happy and excited when she more or less asked him what size check to write.

Don't get me wrong, that's really sweet and very generous. But before we even told our families we talked about what kind of wedding we wanted, and we decided in advance that we would pay for it ourselves. I've posted about this before. That way we can afford it, and we can control it. We can sidestep all the kvetching about whose ex is not paying his fair share, or who sparked a nuclear arms race by throwing down more money than another family could afford. We can do things that are meaningful to us rather than running everything by a committee. Wacky us, we also thought it would be a nice change of pace for our parents to be our guests rather than our benefactors. I always find that it's easier to enjoy a party when you don't know what it costs, and this is a party I want them to enjoy.

So we each explained (gently, I hope, though there's no graceful way to tell one's parent to put her wallet back in her purse) that we appreciated the offer, but that this was something we wanted to do on our own.

I don't know what I was expecting. Not a medal or anything. Relief, maybe? Benign befuddlement? That's not how it has turned out.

My parents, so far as I know, are fine with it. Maybe they found it offputting, but bless their Teutonic little hearts, they're too stoic to tell me. Shiner's mom, I have come to find out, is not so fine with it. Not that she's offended or anything, just that she really wants to help with the wedding, and for many years she expected the way she'd "help" was by helping to foot the bill. We have inadvertently foreclosed upon the very involvement she's been envisioning for herself, and understandably, she seems to be feeling disappointed and maybe a little shut out.

We've tried to find other ways for her to be involved. She came to take one last look at our venue with us, before we signed the contract and were trying to reach a decision. We'll bring a couple of bottles of champagne up to her house for a taste taste to select what we'll serve our guests. We've tried to involve my parents, too, though it's a lttle harder for them because they live several hours away. We're scheduling a cake tasting to coincide with my mom's visit in April.

Opportunities like this to involve our parents are somewhat limited. Because the ceremony is the most important part of this, we want the guest list to be meaningful, if small--only people who know and love both of us. So we can't give our parents tasks like drawing up their personal guest lists. We're having a mingling reception, so no seating charts to help with. We're not give out favors, so there are no bows to wrap around mini bottles of bubbles. We're not doing florals (maybe corsages for the parents, but only if they seem to want them) so there are no centerpieces to arrange or bouquets to design. Get the picture? I have been relishing the fact that there seems to be so little fluff to deal with, but that's turning out to have its drawbacks, too.

Shiner's mom wants badly to help, to be involved, to do something more than show up and enjoy. As in, she got teary talking to me about it today. She's a sweet lady--absolutely dotes on her kids--and I want her to feel important in how we celebrate. But I absolutely don't want to take her money, and I don't want to change our plans or increase our budget to give her busy work that makes her feel important. Plus, she's too smart for that anyway.

Here are things she's suggested: throwing us an engagement party; paying for a rehearsal dinner; paying for the bar tab; paying for flowers; paying for our honeymoon. It's thoughtful and it's generous, but it's not something I'm comfortable with. Shiner could more easily be convinced to let her do it but thankfully he's got my back when I tell him it's important to me that we do this ourselves.

What do you do when people say they want to help you, but what they really mean is that they want to fund you? How do you turn down money you feel strongly about not accepting without being the ingrate who deprives someone you care about of the chance to feel useful?

I think we're going to cave, sort of. Today we started kicking around this idea: we'll ask her if she wants to host a post-reception reception for us. A couple months after the wedding, she can invite all of her friends and extended family (who, remember, Shiner and I will not be inviting to the wedding itself) to a get together of whatever size she wants, and she can have the "fun" she wants of selecting a menu and wording invitations and all that. Yes, it will involve her spending money. But it would be her event, not ours, so it wouldn't feel so uncomfortable to me.

I'm not completely sold on the idea. For one, I don't want it to look like a gift grab (dude, I don't even want a shower!) And for two, I don't want my parents to feel like they've got to do the same (they're not the type who enjoy hosting things), nor do I want them to feel like Shiner's mom gets a special role they don't. And for three, the question, "Do you want to throw a superfluous party in our honor?" seems like it could maybe be taken the wrong way, and that's the last thing I want.

But I'm pretty well at a loss for other ideas. Why can't people just be happy that we don't consider them walking ATMs?

Your ________ Won't Have To Live Off Your Investments

The latest from M.P. Dunleavy at the NYT:

The No. 1 financial complaint I hear from women, delivered in tones that range from exhausted to ashamed to defiant, is this: “I hate dealing with money, so my __ (fill in the blank) takes care of everything.”

That role is often filled by a spouse or partner, although fathers and accountants are also candidates when a woman hands over the reins to her money.

Is this division of labor so wrong?

...

Many couples try to strike a balance when dividing household chores, financial and otherwise. But when women pass the buck, it leaves them far too vulnerable.

...

In a study, “Gender Differences in Investment Behavior,” Professor Hira and her co-author Cäzilia Loibl, assistant professor of consumer sciences at Ohio State University, studied more than 900 randomly selected households with incomes of $75,000 or higher. The study forms a chapter in “The Handbook of Consumer Finance Research” (2007, Springer).

The authors found that while “men were more engaged in their personal finances, generally speaking, women tend to do more of the day-to-day tasks,” Professor Hira said. They tended to abdicate their financial roles when it came to planning for the future, saving and investing. “The majority of women found investing to be stressful, difficult and time-consuming,” she said.

Let me lay out what is wrong with this picture: Your investments? They are your investments. They are what you will rely on to keep a roof over your head and the dialysis machines humming along when you're older. Your dad, your accountant, or your partner, no matter how much they might have your best interests at heart, will not have to rely on your investments the same way you will. And I guarantee you that they will not have the same risk tolerance you do--no two people do. When it comes to your investments, no one can do as good a job as you can. That means you, ladies.

But my partner and I are going to grow old together? you say. Good point. You two do need to plan together. But the key word there is "together." Don't be like my family member, who used his wife's spousal IRA as play money for his investments (it didn't really count, you see, since it was "his money" anyway). He loaded it up with precious metals, which tanked, and then liquidated the account before its value rebounded and later soared. Don't be like my other family member, who took several months to figure out where the money was after her husband died--she never looked at the accounts and had no idea where his savings, investment, and pension information was. Don't be like my other other family member, who steadfastly insists that investing is too complicated and too boring for her, and rebuffs her husband's every attempt to involve her and ask her opinions in managing their accounts. Everybody knows couples like this, even if you think you don't. If you're partnered, be a partner.

And if you're not partnered, hey, think of it this way: you don't have to compromise with anyone.

The article suggests that the way to address this trend of women abdicating their long-term financial planning to the nearest available man is to overhaul the way that financial planning can be done, making it more collaborative, social, and interactive. In other words, more "feminine." It is unclear whether tea parties and sleepovers would be involved.

If tea parties and sleepovers would help some women take a more hands on approach to savings and investments, I'm all for it. But why not focus some of the attention on the root of the problem rather than on the branches?

PROFESSOR HIRA believes a lack of confidence causes some women not to take a more commanding role. Traditionally men are expected to be competent financially, whether it’s their bent or not. “For women,” she said, “the expectation is often that somebody wonderful will be there to do it.”

That seems like an expectation that's worth retooling.

This post was featured in the Carnival of Personal Finance #145.

The Dratted Engagement Ring

Living Almost Large theorizes today that her friends don't mean it when they say they would accept an inexpensive engagement ring. I don't know her friends to know whether she's right or not, but her post does remind me that man, I really hate the emphasis Americans put on their engagement rings. Haaaate it. Hate the obsession with "needing" to have them at all, having them large enough, sparkly enough, expensive enough. Diamond-y enough.

But the way I feel about the institution of the engagement ring--and we'll get to my problems with them in a minute--is nothing compared to the pissed off feeling I get when some tangential acquaintance looks at me with pity when they ask about my engagement and then notice my diamond-less finger. So consider this the monologue I am too polite (or too pressed for time as we ride in the elevator between floors 22 and 26) to give in those moments.

I don't have an engagement ring. At least, I don't wear anything that "reads" socially as an engagement ring but, yes, I nevertheless am sure that he does still want to marry me. No, thank you, I do not need your hugs or a sympathetic ear. I am quite happy to not have a golf ball strapped awkwardly to my ring finger or to have "insurance" in case he backs out. And by the way, eeeew to that last part. You must be very embarassed to have said that out loud.

Not having an engagement ring has saved us at least a thousand dollars that we can invest in our life together rather than in a geologically freakish piece of carbon set in a glassy chemical configuration that has never, since I was the smallest girl, given me any amount of aesthetic joy.

Not having an engagement ring has kept me from having to spend mental and karmic real estate fretting over whether some kid in Sierra Leone is short one leg, or whether some watershed in Central America is running with diluted cyanide, so that I could have a sparkly and immediately depreciating asset on my finger.

Not having an engagement ring allows me to opt out of sexist notions of man as provider and woman as passive ornament, and the sexist custom that publicly marks a woman as having been purchased and thus "off the market" while requiring no such public statement of relational or sexual non-availability by her male partner.

Not having an engagement ring prevents Shiner from having to display his masculinity and creditworthiness for scrutiny and comment by whoever happens to sit next to me on the train.

And not having an engagement ring leaves room on my finger, as well as Shiner's, for my dead grandparents' wedding bands, which each of us are wearing during our engagement because frankly, the hope that we can sustain the kind of relationship that wore this slim band skinny over 43 years of dedicated wear is more compelling than the most well-funded DeBeers ad campaign.

So you've really got to stop feeling sorry for me. Your superficial is showing.

Wedding As Status Symbol

This week, I put down the deposits on our ceremony venue and stationery, and bought my dress and shoes (both vintage, per the Compact, and both amazingly beautiful). So I have got wedding on the brain.

One thing that's been very clear from the beginning of our planning is that it would be very easy to spend ungodly amounts of money on this thing, and there seems to be an assumption even from the most well-meaning quarters that we will do so. People have this idea that "the average American wedding costs $28,000!" or they have a certain vision of how a wedding ought to be, and once you have that number or that picture in your head, it's difficult to talk yourself down to something that doesn't involve a down payment.

But the $28k figure is suspicious, at best. First, the survey pegging that as the average cost was conducted by the Conde Nast Bridal Group, publishers of Brides, Modern Bride, and Elegant Bride. Notice a theme? That's right, all of their publications depend on an audience of engaged women willing to spend about $10 per magazine for hundreds of pages of ads showing them how to spend $3,000 or more on a dress. So let's just say they have an interest in skewing that "average" number high. Really, really high.

Second, what does that number do? As Rebecca Mead points out in her book One Perfect Day: The Selling of the American Wedding, publicizing the $28k cost as "average" means plying couples (and their parents, who frequently have deeper pockets and are paying for some portion of the tab) with the idea that if they spend less than $28k, their wedding will be below average. We can't have a below average wedding! We might have a below average marriage! Clever trick, that.

And all these movies and TV shows and magazines that show the "normal" wedding as involving a huge frothy dress, a sweeping entrance, a grand reception with sitdown meal? The idea that this is the most specialest day of your life, that it has to be perfect, that the bride is a princess and her groom a dashing prince? They reinforce the idea that this is the way things are supposed to be done, and if the way it's supposed to be done costs bank, you've got to suck it up and make bank or You. Are. Doing. It. Wrong.

Those expectations make it easier for even conscientious couples to overspend: if that's what you've seen at every wedding you've ever been to, if that's what your parents are pressuring you to have, if you feel like you can't legitimately ask far-flung family and friends to travel a long distance at great expense without at least feeding them steak and whiskey, for godsake, it takes a steel spine to say No, we do not choose to spend money in a way that is so out of step with our everyday life.

My question to people with longer memories than mine: when did this come to be? I don't doubt that there have always been people who spent lavishly on their (or their children's) weddings. But for a very long time, those people weren't normal, economically speaking: royals, nobles, wealthy merchants, the idle rich. Normal people, the middle class and poorer folk alike, got married in ways that resembled every other day of their lives. A more dressed up, joyful, public day, for sure, but my understanding is that getting married didn't used to mean pretending you were Anastasia Romanov or Miss America. At least in my family, it meant wearing your nice clothes, exchanging some touching words and a simple band, and afterwards having cake and punch and finger sandwiches in the church basement or your great auntie's living room. Decidedly not bank.

That's what my grandparents did. Theirs were weddings that were congruent with their means and their lifestyles. But we don't need to go back two generations to see that the outsized expectations people have of weddings are a new phenomenon. The Conde Nast shows an increase of 100% in wedding-related spending between 2006 and a decade previous.

It's not just that the traditional line items are getting more expensive, though they are. There is also a whole new set of norms compared to the conventional wedding of the pre-war era: the all-day photography coverage rather than the standard portraiture shots, the wear-only-once dress rather than the nice outfit--maybe new, maybe not--that could be worn again, the DJ plus the band, the sit-down meal for hundreds of guests, the favors, the limo, the "destination wedding," the "black tie" dress code, the gift bags to be placed in the hotel rooms of out-of-town guests. These are not just things hocked in the pages of advertiser-driven wedding magazines to women who (hooray!) get to feel inadequate and expectation-saddled in a whole new way. Of course not everyone who gets married these days does all of these things, but not a single one of these items would be commonly seen as outre, and doing all of these things would not be remotely conspicuous or noteworthy. What is up with that?

I am not interested in criticizing people who make these sorts of choices. How hypocritical would that be, with us hiring a photographer with assistant for eight hours of coverage? But I do think it's worth it to criticize the way in which couples are pushed to make those choices unthinkingly, and also worth it to think of whether the expectations we might have as guests are fair or warranted. There is something wrong with the fact that these costs are seen as across-the-board normal, rather than as indulgences to be chosen with care based on one's priorities and means.

I got a panicked email from a friend of mine a few months ago, asking me to look at an online retail listing for a suit and tell him if that was OK for a "black tie" wedding he'd been invited to. The guy didn't know how to dress for a black tie event because newsflash! Unless he is a Gatsby enthusiast or the son of a socialite, no contemporary twenty-something man is likely to have ready access to a tuxedo. At root, it's very costly play acting of an imagined social status to throw a "black tie" wedding when the couple getting married have never before had a "black tie" occasion save their senior prom.

Maybe I will go down as the world's ultimate wet blanket for saying so, but weddings that are so astronomically out of alignment with a couple's normal life are cheesy and grasping. I don't care if your parents are paying for it, I don't care if it's what you've always wanted. I don't care that, theoretically, you are only going to do this once and you don't want to feel like you missed out on any aspect of the fairy tale party. If saying so makes me mean, I don't care about that, either. A wedding can be a status symbol, just like owning the McMansion or tooling around in the leased Jag. And it's no more admirable or wise to have a status symbol wedding you can't yourself afford than to have a status symbol house or a status symbol car that is beyond your means.

So what are we doing about it, Shiner and me?

First and not at all intuitively, we're giving in. There are going to be a number of things that, while not legally, religiously, or ritually neccesary we are going to want to have. That's OK, we're products of our culture. But we are giving in selectively, based on what we most value and based on what we can afford. So jewel-encrusted engagement ring, no. Scads of photography, yes. Bouquets and attendants, no. Fancy, delicious cake, yes.

Second, we are paying for everything ourselves, based on what we can comfortably afford. Not accepting money from our parents has a number of pleasant side effects, among them making sure they we're not inflating this event beyond what is really important to us just because we suddenly have more "free money" available to spend. Our budget allows us to have plenty of indulgences, but we cannot have them all. If we could afford less, we would spend less, and we would still end up just as married and ultimately just as happy. Our families and friends have made numerous suggestions and voiced several expectations about what we will or will not be doing, but we cannot afford to do everything they want. That's fine. It's thoughtful of them to try to be helpful, but it's our responsibility to commit to no more than we can afford.

Third, the rule of the day is What Would Grandma and Grandpa Do ("WWGGD?"). We're focusing on the ceremony, and as a result we're deliberately keeping the reception low-key and relatively inexpensive. Shiner is wearing a nice suit he can wear again and again. My dress could also be reworn, though honestly I'm more likely to save it for eventual donation to a vintage textile or fashion history collection--it's really that amazing. We're having blank letterhead stationery made so we can handwrite our invitations and thank you notes and use any extras for everyday notes and letters (we are both paper nerds). We're not doing anything that feels unimportant to us, and we're being very deliberate in sussing out exactly what is important to us--and why.

WISER on Retirement

Women's Institute For A Secure Retirement (WISER), a nonprofit organization under the Heinz umbrella, recently published the monograph What Women Need To Know About Retirement.

Women And Retirement: The Backstory
Retirement income has in the past been described as a "three-legged stool" with "legs" made up of Social Security, employer-sponsored retirement programs like private pensions or 401(k)'s or 403(b)'s, and individual savings. This model is becoming increasingly irrelevant to all Americans, but is particularly inadequate when it comes to women. With the risks faced by Social Security and the fact that employer-sponsored retirement programs are frequently not available in lower-paying or sporadic work, the only "leg" available to many is their own private savings.

But in addition to these challenges, women face particular difficulties financing their retirement on personal savings alone. The persistent wage gap means that women earn 77 cents for every dollar earned by a man. Due in large part to caregiving responsibilities that men are not asked to fulfill, women spend less time in the full-time work force and miss out on promotions and work experience in the meantime. They are more likely to work part-time than men are, and the average woman's total working life lasts 27 years, compared with 40 years for the average man. Yet on average women live longer than men, so their lesser earnings and savings must last them longer. Consequently, women's income in retirement is less than men's, and the rate of retired women living in poverty exceeds 20% for white women, and is over 40% for Black and Latina women.

So it's an uphill battle with daunting odds. Where to start?

A number of the chapters focus on government programs that are likely to change significantly over the next thirty to forty years. For those who are still a ways away from retirement, I wouldn't recommend doing much more than skimming chapters 4 (on Social Security) and 5 (on Medicaid and Medigap and long-term care insurance), since many aspects of those programs will almost certainly be quite different than they are now. It's worth it to understand how Social Security benefits are calculated, since that calculation tends to screw women pretty dramatically, and we might want to therefore plan around it. But Social Security is not a stable enough program to be a source of income I am counting on in retirement. If it's still around and I'm still eligible, it will be gravy. And while I expect Medicaid will last in one form or another until I am all wrinkles in my purple dress and red hat, I suspect it will only barely resemble the mishmash of programs we have now.

Chapter 3 is basically Investing 101, covering a lot of ground, but not in enough depth to be very useful to anyone who hopes to take action. Better coverage of investment how-tos can be found elsewhere.

There are, though, a few chapters worth highlighting out of this 78-page collection, covering ground such as how to budget in the present to protect your future, a brief summary of different vehicles that can provide income in retirement, and a short treatment of what to do if things go terribly wrong.

Chapter 2: Budgeting Now for Future Security is written by Elizabeth Warren and Amelia Warren Tyagi, authors of The Two-Income Trap: Why Middle Class Parents Are Going Broke and All Your Worth: The Ultimate Lifetime Money Plan. The chapter basically condenses the plan they describe in All Your Worth into seven pages. (The Simple Dollar provides a more in-depth review of the book here).

First, get a handle on your must-have expenses (mortgage, health care, utilities, daycare, basic food, minimum debt payments) so that they take up less than 50% of your monthly income. If you can't do that, cut your costs. And if you still can't make it down to 50%, get as close as you can, because 65% of your income spent before you have it is better than 70% is better than 75%. Second, pay off your debts by not taking on any new debt and by paying off all your existing debts, one by one. Warren and Warren Tyagi say to exclude mortgages, student loans, and car loans in this steps. Debt repayment and savings, addressed in section 3, should take 20% of your monthly income. Third, save three months' pay for an emergency, and fourth, pay off your home by chipping away at that debt.

The authors don't address retirement savings until step 5. They say only after your consumer debts are paid off and your emergency money is stashed should you invest for retirement by putting 10% of your monthly income in a workplace plan or an IRA (note: they don't specify a Roth IRA, which seems like a big oversight).

Chapter 6: Retirement Income covers different vehicles that can provides income in retirement--Social Security and Medicare, pensions, 401(k)'s and 403(b)'s, IRAs and Roth IRAs, regular investments--and looks at how they can work together to provide for you in retirement. It briefly covers how to make wise choices with the vehicles available to you, such as delaying retirement to maximize the benefits available under a pension or Social Security. There are several examples of couples using different combinations of vehicles for their retirements, and the chart on page 54 and 55 describes the advantages, disadvantages, and tax treatment of each vehicle as wells as penalties for late or early withdrawal.

Chapter 7: Planning for the Worst is premised on the idea that "good planning can help to prevent a personal tragedy from becoming a financial disaster." It provides a list of steps women can take before disaster strikes (that's now, my friends) to protect themselves financially:

Keep copies of important financial documents and records, and keep them organized. This includes account numbers, brokerage information, wills and prenups, house deed and mortgage documents, and safe deposit box info.

Have both joint and separate checking accounts. If all the accounts are in your spouse's name, it can be hard to do things like make sure the mortgage is still getting paid, because it can be a hassle to get access to that account and continue the payments yourself. Having your own, solely owned account is wise, though, so that you have access to your own funds if, say, the will is contested and your spouse's assets are frozen.

Establish and maintain good credit in your own name. If all your credit is in your spouse's name, you will be in dire straights in the event of widowhood or divorce. Should you need to refinance your mortgage or take out student loans for job training or open your own credit card, you'll have to find a cosigner or go without altogether. Monitor your credit reports to make sure they are accurate.

Buy the insurance you need, including home insurance, health insurance, disability insurance, life insurance, and car insurance. By the way, stay-at-home parents should investigate whether life insurance makes sense for them. Just because they're not drawing a wage doesn't mean their families don't need it. If the SAHP dies, would the family need to start paying for daycare? A housekeeper? Could they afford those expenses on the wage earner's salary? If not, get life insurance.

Get a will! I mean it. Especially if you have kids.

The chapter also has a list of financial considerations for women facing divorce or widowhood, unemployment, or medical emergencies.

What's Missing?
I feel like I'm going to say this a lot over the pages of this blog: This is good advice for anyone, but it's especially vital for women. Because we earn less money over less time and have to make it last for longer, a financial mistake made by a woman could jeopardize her future more dramatically than that same mistake could affect a man. And by "jeopardize her future" I mean "push her under water."

What's missing from this report is any analysis how to fix this disparity. Why do women earn less? Why do we carry the bulk of the non-paid caregiving duties? Surely not because we are better people or because we have no use for the money we forego. Neither of those describes me, at any rate. By asking how we fix it, I don't just mean at a political or social level, though those are certainly important aspects, since a lot of this difference in financial security is a result of cultural forces.

I mean that it is worth making explicit that when women take time out of the full-time paid work force to raise their children or to care for aging parents or in-laws, they are going to take a financial hit for it in ways that aren't intuitively obvious. The women making these choices and their partners need to fully understand the long-term ramifications of these choices. Not only do these women not draw a paycheck during periods of leave, but they don't get raises or promotions during that time. They don't get employer matches in their retirement accounts. Part-time workers may not be eligible to contribute to a 401(k), either, or may not be eligible for a match. They may not be re-hired or re-integrated to full-time at the same level of responsibility or seniority if and when they try to come back full time. They will deflate any Social Security benefits they might be eligible for having several years of no or low pay factored into their benefit calculations. These impacts are very real. Are they worth it?

If staying at home with the kids is what a woman ultimately decides to do, there are ways to mediate the long-term financial hit: spousal IRAs, or spousal deposits into taxable investment accounts solely in the stay-at-home parent's name. Families need to talk about the full range of impacts before making these choices, and decide how they are going to share these burdens. That's right, I said share.

This is not about Mommy Wars. This is about wanting every woman to safeguard her own future by making considered choices now. These financial impacts deserve thoughtful discussion ahead of time, both in terms of deciding whether taking the hit is worth it and in terms of taking action to mitigate it. If we're not seeing these important conversations modeled in the financial literature, how can we expect it to be on a woman's radar for consideration? The WISER monograph provides good basic info and good advice, but it doesn't go deep enough into those considerations that most uniquely affect women.

Congratulations Are In Order!

In our last State Of The Union, sweetie set a goal of making $10,000 in excess of his current salary in 2008, which he will put toward his credit card debt. I am very excited to tell you he got offered a part time position at a store he enjoys and whose products he believes in. Think fanboy levels of love. I don't think this part time job will get him all the way to his $10k goal--he is still hoping to make a change in his full time work, too--but it's a great start and I am so proud of him, and really happy he's lined up a gig he thinks he will enjoy. It will cut into our time together which sucks, of course. But in the long run this is good for both of us. What the heck, maybe with him at work more I will feel compelled to buckle down and kick out some more billable hours, or work on an article. He has made some big changes in the last few months and I am so proud of him.

Oh yes, and though I will always thinks of him as sweetie, he has informed me that this psuedonym is just a little too twee. So sweetie shall be henceforth know as Shiner. Yes, as in Bock.

Wells Fargo, Take... Four? Five? Ten?

How many hours have I spent on the phone with Wells Fargo over the last couple of years? After over a decade of incident-free banking, in which I have never had any problems that required more to resolve than a quick driver-by conflict resolution with the local teller, I moved away from my hometown bank and I opened a new set of accounts with Wells Fargo. They were conveniently located, they held my mortgage, and their hold music is no more crazifying than anyone else out there. And you know what? To their credit, they've always been really nice when I've called and asked them to fix their mistakes. But I have spent literally hours with them over the past couple of years getting them to correct their mistakes.

The joint account sweetie and I use to pay our household bills is the latest Wells Fargo timesuck. For a while we were getting a $1 fee every month as a fee to view electronic images of checks we wrote from the account. The problem? We never had checks printed on that account, we use it exclusively for free online billpay. Every month we'd be charged for an add-on feature that we never requested, never used, and in fact had absolutely no way of using. And every month I'd call, they'd reverse the charge, say they didn't know why that fee kept appearing, and reassure me it would never happen again.

Last week I called and went through the rigamarole again, and Steve, the guy who reversed the bogus charge, said that if we would just let him change the designation on our account from "Advantage" to "PMA Advantage" we could keep using our account just as we were now, only without any monthly mystery fees. Done and done. Today sweetie sent me an email asking if I knew why our account was overdrawn by about $4 when we normally leave a cushion of at least $20 in there. Instead of our old friend the $1 charge, we had a $25 fee for the privilege of having this new account designation.

Luckily Steve had given me his direct number, and I got him on the phone quickly. He reversed the charge and said "some linkages" had gotten messed up when they'd reprocessed the account designation, whatever that means, and that it wouldn't happen again. Awesome. I'll let you know in February whether that's true.

Stop the tyrrany of your shrewish wife by purchasing lady-appeasing gadgetry

A dopily titled blub ("The Wife Factor"?) in the New York Times Bits blog about the Consumer Electronics Show notes that TV manufacturers are trying to pretty up their wares so the ladies of the world do not exercise a spousal veto over their menfolks' purchase:

With TVs getting as large as some SUVs and no longer hidden in armoires, wives are putting their foot down when it comes to placing these in their living rooms.

Which is why this year's crop of flat panels features rounded edges, clear plastic frames, and, in the case of LG and Samsung, dark red accents burned into the bezel.

Riiight. Because if you slap a little embellishment on it, women won't notice that there's a fifty-inch slab of exhorbitantly priced electronic equipment staring at them when they walk in the front door. This is the problem with so-called woman-focused marketing and design, most of which assumes we're all awfully shallow and girly. If your product is ugly, has poor functionality, or costs more than I expect to spend this year on all utilities combined, the fact that it features "dark red accents burned into the bezel" (ooooh!) will not entice me to buy it. Or, excuse me, to "allow" my partner to buy it.