Songburst: Playing to Win

While we were in Sunriver, the group played a marathon session of Songburst, the “name that tune” game. Steph read song titles and lyrics to us, and we tried to guess the next words. This was the “70s and 80s” edition, so it hit the sweetspot of our childhood years.

We were all surprised at how skilled Kristin was at Songburst. She nailed even the most obscure songs. It’s as if she’s spent her entire life curled up, listening to K103 on a transistor radio.

Part of the fun was singing the cheesy songs of our youth, and discovering who loves which artists. Kris stunned us all with her Stevie Wonder impersonation. Jenn is a big fan of Olivia Newton-John. Kristin can sing “Brand New Key”. And I like the Little River Band.

Because I was a little tipsy (though not nearly as tipsy as Jeff, who was very happy), I downloaded three albums during the game: Toto’s Greatest Hits, Paul Simon’s Greatest Hits, and Little River Band’s Greatest Hits.

This morning as I was working around the house (trying to recover from this damn cold), I was playing Little River Band at full blast, bellering, “Have you heard about the lonesome loser, beaten by the queen of hearts every time?” Then a song came on that I cannot recall having heard before. It was rocking. And then it wasn’t. And then it was.

“Oh my goodness,” I thought. “The video for this has got to be awesome.” I meant that ironically, of course. And yes, yes the video is awesome. Ironically.

My friends, I give you “Playing to Win” by the Little River Band, circa 1985. Enjoy.

Now, if you’ll excuse me, I need to go download Dan Fogelberg’s Greatest Hits…

Mini Mileage

We’re home from another great weekend trip to Sunriver. We do this trip every year with the MNF group, and it’s almost always fun. We’ve finally found a house that seems to facilitate group interaction, which is awesome. This was our fourth year in the same spot, and since Kris and I are planning the trip next year, you can count on a fifth year, too.

One of the best parts of this year’s excursion was driving my new (used) Mini Cooper, which we’ve dubbed Bumblebee (or simply Bumble). Kris was very patient with me as I toyed with acceleration in spots. Fun.

As a stats geek, I love the onboard computer. I suppose most cars come with these nowadays, but they’re new to me. Bumble can display his real-time fuel consumption and calculate his average usage. He can do the same for speeds. (And, best of all, Bumble can tell me how far he can go before he needs more gas!)

I’ve always been curious which path to Sunriver is quicker, over Mt. Hood or over the Santiam Pass. This year I tracked our numbers:

  • Our trip to Sunriver took us from Oak Grove to Sandy to Madras to Redmond to Bend. We covered 169.2 miles in three hours and thirty minutes, for an average speed of 52.9 miles per hour. Bumble traveled 34.0 miles per gallon.
  • On our trip home from Sunriver, we went from Bend to Sisters to Stayton to Silverton to Oregon City to Oak Grove. We covered 180.0 miles in three hours and 45 minutes, for an average speed of 51.8 miles per hour. Bumble traveled 39.8 miles per gallon.

For the entire trip (which included some time puttering around Sunriver and Bend), Bumble traveled 430.6 miles and used 12.225 gallons of gas. That’s total fuel efficiency of 35.2 miles per gallon.

One drawback is that Bumble does require Premium fuel. Ouch. That stuff’s expensive. However, I ran the numbers for the final 30 days I owned the Focus and compared them to my first two weeks with the Mini, and it seems the Focus was actually just a hair more expensive to run. (Well, comparing fuel costs only, that is.)

Now, however, it’s time for bed, even though it’s only 7:20. I’ve returned from Sunriver sick as a dog. Ugh. Why me? Why now?

p.s. This is odd. I just re-read my old posts about Sunriver. I came home sick from the 2006 trip, and again in 2009. Kris returned home sick in 2007 and 2008. “Why do you think that is?” I asked Kris. “It’s because those people are germ factories!” she said. I thought that was pretty funny.

Parallel Universe

As I mentioned at Get Rich Slowly the other day, I’ve discovered the bus.

I can recall riding the bus when I was just a boy (so before the age of two — right, Mom?), and I rode it once in high school to visit Paul Carlile when he was in foster care, but I’ve never ridden it as an adult. I’ve been on buses in other cities — just not in Portland.

What took me so long?

I was sort of in a panic Wednesday when I learned that the routine service on my new (used) Mini would keep the car in the shop overnight. How would I get home? Eventually I realized I could take the bus.

And I rode the bus back into the city on Thursday. A fifteen minute walk to the bus stop at Oak Grove and McLoughlin, a twenty minute ride, and bam! There I was at 4th and Washington.

I love it.

I had a sense of exhilarating freedom as I sat in O’Bryant Square just killing time. I know this probably sounds lame, but it’s liberating to not have a car downtown. I didn’t have to worry about parking. I could wlak where I wanted and take as long as I wanted. I could watch the skateboarders, and the mounted police (and the bicycle police), and the businessmen eating Chinese takeout on the park benches. I could sit there and write.

Sure, I could do all of those things if I’d driven downtown, too. But I wouldn’t. I’d be in a completely different mindset. It’s as if when I stepped on that bus I entered a different world — a parallel universe.

Later in the day, I met my friend Ramit for lunch at Kenny and Zuke’s. He was in town from San Francisco to promote his new book. I lingered a long time, chatting with our readers (especially Davy and Kinley), and then walked up to the Mini dealer to get my car.

The whole time, I felt like I was in a strange and wonderful alternate universe. All because of public transportation.

(I’ll admit, though, that it felt good to drive home!)

A very small adventure: Riding the bus

I had a big day today, though I’m sure many of you will laugh: I rode the bus for the first time.

Actually, I’ve been on buses many times before. I rode a school bus as a child, and I’ve used public transportation in other towns. I’ve even used the light-rail trains here in Portland. But I had never used the city’s bus system until this afternoon.

Brave New World

I took my new-used Mini Cooper to the dealer this morning for the inspection I should have requested before I purchased it. Also, the car was due for its 60,000-mile service.

While it was in the shop, I walked around downtown Portland, taking a day to play hooky from the blog. I ran some errands. I shopped for my mom’s birthday presents. (She’s 61 today.) I had lunch with a friend.

After we finished eating, I called the dealer, crossing my fingers that there wouldn’t be any bad news. I’m pleased to report that there’s nothing major wrong with the vehicle — just normal wear-and-tear. I dodged a bullet. (The next time I buy a used car, however, I’ll be sure to have it inspected first.)

All the same, there are a couple of small things that need done, including the repair of a leaking power-steering fluid line. “Can we keep the car overnight?” the dealer asked.

“Sure,” I said. But I was really thinking , “How will I get home?” I thought of how much I paid for taxi fare in San Francisco last week. Then I remembered that Kris used to work just two blocks from where I was standing. She used to ride the bus to-and-from work. Why couldn’t I take it home?

I lucked out; the bus I wanted was pulling to the stop just as I arrived. I hopped on board, fumbling my way through the process. “How much?” I asked the driver. He grunted and pointed at a placard listing the fares: $2.30 for an all-zone pass. I put three one-dollar bills into the ticket machine. “Where’s the change?” I asked. The driver grunted and pointed to another placard that noted there’s no change for bus fare.

Half an hour later, I stepped off the bus about a mile from our home. Another pleasant fifteen minutes of walking saw me safely to the door.

A Small Victory

I realize this is a fairly minor accomplishment, and that many of you won’t see the merit in this. That’s okay. It’s a big deal to me. For years I’ve avoided the bus because I didn’t know how it worked, and because I didn’t know how cost-effective it was. Today I took a chance and just did it. I’ve added another frugal weapon to my arsenal. When the Mini dealer calls tomorrow to say my car is ready, I’ll hop on the bus and head back downtown.

Because I’m that kind of geek, I calculated costs on my ride home. Is the bus cost effective? Is it time effective? I was curious. Here’s what I figured out:

  • The bus ride from downtown Portland to my neighborhood takes 30 minutes. It takes another 15 minutes to walk home. (There’s actually another line that runs closer — I’ll have to look it up.) It costs $2.30 per trip.
  • To drive from downtown Portland to our house takes about 20 minutes. If we use my estimated costs for the Ford Focus I recently sold, it comes to 36.1 cents per mile, or about $3.60 per trip.

So, a round trip from our home to downtown Portland costs $4.60 and takes about 90 minutes on the bus. It costs $7.20 and takes about 40 minutes by car. (Addendum: In the comments, Robert reminds me that to go downtown, I need to pay for parking. That’s true. That brings the total to $9 (or more) per round-trip.) Depending on which is more valuable to you — time or money — you might choose either the bus or a car. In my case, a car is usually the best choice. But I can certainly see how having the bus as an option could save me money sometimes (like today).

And I can understand how, for many people, public transportation can be a heck of a deal!

Note: I’m enjoying this working vacation. It’s been very productive. Although I’m eager to resume writing full time, I’m actually going to stretch this current batch of guest posts until the end of the month. I have some good guest articles on personal finance basics in the queue, and this will give me time to recharge my batteries so that I can come back even stronger in May!

The Turning Point

I had lunch with my friend Bo recently. Over our enchiladas, we talked about how dumb we were when we younger, and how we’d do things differently if we could. To what point would we return if we wanted to change our lives?

“I’d go back to the end of my sophomore year of high school,” Bo said.

“That’s a long way,” I said.

“But think of compound interest, J.D! And by then I was earning money. I was earning money and I was spending it. If I could go back, I would save like crazy. I would invest in mutual funds. I would buy a house — a fixer-upper. I’d spend much less on food and clothes and comics.”

Like me, Bo is a comic book collector. In fact, when we were in college, I gave him a bunch of my comics. Boy, was I dumb. I was dumb in a lot of ways then. If I could go back, that’s the time I’d pick.

I told Bo about signing up for my first credit card, I told him about the $1500 Frisbee, I told him about trying to spend money to keep up appearances with the other students on campus. “If I could go back,” I said, “I’d go back to the sophomore year of college.”

“Your story’s interesting,” Bo told me, “because I think it’s similar to the stories of so many other people. And because you’ve managed to make it through and become successful.”

“Thanks,” I said. “I’m just glad to have turned things around.”

“How did you do it?” Bo asked. “What was the turning point? Do you remember?”

Turning away from debt
“Sure,” I said. “I tell this story all of the time. My turning point came in the summer of 2004, after we bought our new house. I had been living paycheck-to-paycheck on $42,000 a year, spending every penny I earned on books, comics, and other toys. Just Stuff, you know?” Bo nodded. He and I have talked about Stuff before.

“Though I could afford it on paper, I hadn’t counted on the unexpected costs that come with a 100-year-old house. When we started having to spend for new insulation and to replace the walls and to remodel the bathroom, I felt like I was drowning. I felt out of control. I’d been in debt for a decade and managed to avoid disaster, but I really felt like disaster was just around the corner.”

“But what was your turning point?” Bo asked, sipping his Dr. Pepper.

“Right,” I said. “My turning point came when I started complaining about my debt to friends. A couple of them pulled me aside and shared books with me. I read them and tried to follow their advice. To my surprise, it worked. Ever since then, I’ve been on this path. I make mistakes sometimes, but that’s when I changed direction.”

“That’s awesome,” Bo said. “Reaching a turning point is huge. It sucks to be out of control. When you’re out of control, it can seem impossible to turn things around. But once you do, it’s great. Just like you and your baby steps. They’re small moves, but they make you feel powerful. Being in control makes you feel powerful. Being in control is a high. And being in control when you had been out of control is even better.”

“What about you?” I asked. “What was your turning point?”

Seeking a better life
“Well, I was never in debt like you,” Bo said. “If there was a turning point for me, it was the day I realized that I didn’t want to work for the rest of my life. Of course, you can’t just stop working. You can’t just put it on autopilot.”

We’d finished our meals and were picking at the chips and salsa by this point. Bo continued: “I remember sitting down and counting the productive years I had left, and then counting the years that I’d already worked. I realized that I had to get on the ball if I wanted to retire early, if I wanted to have time to do the things I want to do.”

“Early retirement’s a great goal,” I said. “But it seems so big and so far away, it can be hard to stay on-task.”

Bo nodded. “Any time I see something that I want — which is all the time — I’ll ask myself if it’s something I really need, if it’s something I’m willing to delay retirement for. Every dollar I spend on Stuff now is a dollar that could have helped me quit work sooner. Do I really want to spend money on frivolous crap that goes into boxes? Or do I want to save my money for a better future?”

Bo paused for a moment before he continued. “This may sound strange,” he said, “but Hurricane Katrina had a huge impact on me. When I saw all of these people with their Stuff floating down the street…when I thought of it in those terms, I realized that my house is just full of crap. I realized that I need to get rid of Stuff, not bring more home.”

“Fortunately, my wife and I are on the same page. We have the same goal. Like everybody, we still buy Stuff. But we don’t do nearly as much as I used to. We’d rather have the money so that someday we could do things with our family instead of having Stuff that sits in our drawer.”

“That’s great,” I said. “It sounds like you’ve always been pretty smart with money, but for you the turning point wasn’t about changing bad habits. It was about developing better habits.”

“Right,” Bo said. “I’ve always understood where I wanted to go and how to get there, but I always talked a big game, and didn’t really walk it. Then one day I realized that every penny I spent that wasn’t part of my plan, was just an impediment to me quitting my job and spending time with my family.”

We paid the check and said good-bye, agreeing to meet for lunch in a few months. But this conversation stuck in my head. Not everyone experiences a turning point, and not everyone needs one. But I believe that for those who do, this turnaround can be powerful, life-defining experience.

Two Glimmers of Insight

I’ve had a lot of amazing experiences lately that I’m not able to write about for a variety of reasons. However, I had two encounters yesterday that seemed especially important to me, and I wanted to write them down before I lost them. These anecdotes will be a little vague. Sorry.

I’m in San Francisco for some professional development and media relations training. (Yes, I’m serious.) It’s been a whirlwind of activity, but I love it.

In a morning meeting, I was complaining about the entire journalistic process in the United States. I’ve seen enough of it from the inside now to know that I cannot trust a single thing I see on television or read in a magazine. (Remember our five-year-old argument about Truth vs. truth? The media takes this to a whole new level.) These stories are manufactured, just like a cardboard box. They’re not reported. The “journalists” create the story they think their audience wants, and when they contact me, I’m just an ingredient.

Bill, one of the fellows working with me, listened to my complaints, and then he said, “J.D., you can’t look at it like that. You can’t expect it to be straight reporting because it’s not. You have to think of it like sausage. What they’re producing is sausage. The media is a giant sausage factory. You don’t want to know what goes into the sausage or how it’s made. You just have to trust that what comes out at the other end tastes good.”

I loved this analogy. Based on my experience, it’s so completely apt. It’s exactly what goes on.

I’m in the midst of participating in a bit for tonight’s episode of “On the Money” on CNBC. I’ll be on their Success Stories segment. But you do not want to know the ingredients to this piece of sausage.

Later in the day, I was working with Michelle, who is giving me public speaking training. She was asking me about my story and my goals. She wanted to know how I present myself. What do I want people to remember me as? I kept coming back to my old song-and-dance: I want people to trust my advice and listen to what I have to say, but I don’t want them to think of me as a financial expert. “I’m just a regular guy,” I said.

Michelle shook her head. “That won’t work,” she said. “You can’t kiss a girl through the screen door.” She didn’t even have to explain what she meant. I understood her meaning immediately. “The truth is, you are an expert. You’re an expert on the fundamentals of personal finance. You’re a common-sense advisor.”

Great stuff. (She also gave me a good disclaimer to use after I bill myself as a spokesman for common-sense fundamentals. She told me to say: “I am not an expert in this space. You should seek a professional advisor.” In other words, I should lay claim to what I can, and then offer people further options.)

I have another entire day of training ahead of me. I have to be over at the office in 25 minutes. I’m excited for what it might hold.

My used mini cooper and the power of saving

For the past two years, one of my top financial goals has been to save for a Mini Cooper. Just like a child with a toy catalog, I’ve spent hours on the Mini website playing with colors and options packages, building my own dream vehicle. Whenever I’m tempted to buy small indulgences, I ask myself, “Would I rather have this or a Mini?”

Until the beginning of last week, however, I thought I still had a long way to go before I could afford even a used Mini Cooper. Turns out I was wrong.

Savings Success

Since the middle of last year, I’ve been saving like mad, attempting to accumulate enough money to buy a car. My progress has been outstanding:

  • After I built my emergency fund, I began to route my regular monthly savings to my Mini Cooper account. I’ve saved about $6,200 for a car during the past eighteen months.
  • I’ve also been putting “found” money into my car account. When I get a birthday check, it goes to my Mini fund. When I sell something on eBay, it goes to my Mini fund. That’s come to almost $700 in the past year.
  • In October, I won a contest at ING Direct. My prize was a $1,000 6-month certificate of deposit. It matured last week, and I promptly rolled the proceeds into my Mini fund.
  • We refinanced our house recently. The last payment on our old mortgage was made in March. Our first payment for the new mortgage is due May 1st. There’s no April payment! That means I can use that thousand dollars for a Mini.
  • Also as part of the refinance, we received a disbursement check of $1879.03, half of which goes to Kris and half of which goes to me. That’s $939.52 more for a car.

All told, by the beginning of April I had managed to save just over $10,000 for a car. That’s not enough to buy a Mini Cooper — not even a used one. But then I found another chunk of change.

Tax Refund

Because I’m self-employed, I pay quarterly estimated tax payments based on income projections I make at the beginning of each year. But because my business has been growing, these projections have been off. At the end of the year, I owe more than I’ve paid, and so have a tax bill due.

The first year this happened, it caught me by surprise. I owed a lot of money, and I didn’t have anything saved to cover the tax bill. Ever since, I’ve set aside as much as possible to prepare for taxes.

Note: For others with their own businesses, here’s what I do: Every month I transfer living expenses from my business account to my personal account. I keep these expenses as low as possible. I leave the rest of the cash in the business to save for taxes. After taxes are paid in April, I pull any remaining “profits” for the year into my personal account.

Well, I paid my taxes last week. When the checks were written, I was amazed to find that I had a huge chunk of cash left over. In fact, there were several thousand dollars remaining in my tax account, all of which was now available for my personal use. I transferred the money to my Mini Coooper account, and stared at the total: I had $16,768.98 in savings.

I almost had enough to buy a car.

New vs. Used

With stars in my eyes, I dropped by the local Mini dealer last Wednesday to wander their showroom. I spent an hour talking with a salesman. He was awesome. He didn’t pressure me, but answered all of my questions. Though I loved the shiny new cars, the vehicles I really wanted were marked at over $25,000. (Most were around $28,000, and one amazing Mini was $40,000!)

“I don’t have enough saved to buy a car right now,” I told the salesman, “but I’d love to rent one for the weekend.”

He frowned. “I’m afraid we don’t do rentals,” he said. “I don’t know anyplace in Portland that rents Mini Coopers. Sorry.”

Then he added, “You know, Mini is offering 1.9% financing right now — if you have good credit. That’s a good deal.”

“Thanks,” I said. “My credit’s great, but I’m not wiling to take on debt. I’ll just wait and keep saving.”

Then a friend called on Friday. “J.D., have you been down McLoughlin lately?” he asked. “There are two used Minis for sale along the strip.” (I live next to a stretch of road that is home to more than a dozen car dealerships.)

I hadn’t considered buying a used Mini (I’m a new car kind of guy), but the more I thought about it, the more the idea appealed to me.

  • If I bought used, I could avoid the instant depreciation associated with a new car.
  • If I bought used, I could save the price difference for other goals.
  • And if I bought used, I could have my Mini Cooper now.

On Friday afternoon, I dragged Kris with me to look at the two used Minis.

The first vehicle was a 2003 Mini Cooper S marked at $13,800. It had 70,000 miles on it. On the surface, this seemed like a great deal, but the car wasn’t in good shape (even after being cleaned up by the dealer), and the salesman gave me a gitchy feeling. I decided to pass.

The second car was a 2004 Mini Cooper marked at $17,000. It had 60,000 miles on it. This car was more expensive, but from what I could tell, it was also in better shape. I took it out for a spin.

“What do you think?” I asked Kris after the test drive. “Should I buy it?” Though I’ve made tremendous progress with my personal finances, I still have a tendency to second-guess myself. I know I’ve done some dumb things in the past, and I’m afraid of heading down that road again. But Kris has always made smart choices. I trust her judgment.

“Do you like it?” she asked. I nodded. “Then you should buy it,” she said. So I did.

The Negotiator

It’s been a long time since I bought a car. I had forgotten how awful I am at negotiating — and how much I hate it. I tried to do a good job on Friday, tried to remember the tips I’ve shared here in the past, but even knowing this stuff in advance didn’t help me. I don’t think I did poorly, but I certainly didn’t get a great deal, either.

I paid $15,600 for my Mini. Kelly Blue Book says that I could expect to pay $14,790 for this vehicle from a private party, so I paid about $800 too much. (It also says that I should expect to pay $17,240 from a dealer, so maybe I actually saved $1,600?) Kelly Blue Book also says I should have received $1,250 in trade-in for my Ford Focus. I got $550. Ouch.

In retrospect, I ought to have done this differently. Once I realized I had enough to buy a used Mini, I should have been methodical about my search, looking for the best deal. That’s what I do with all of my other purchases! Instead, I let euphoria take hold of me, and I bought the first acceptable vehicle that I saw.

I don’t regret my purchase — not at all! — I just don’t think I was as smart as I should have been.

The Joys of Personal Finance

Time will tell whether I’ve made a good choice. It may be that my impatience has cost me money. Or it may be that the pleasure I receive from this little car is worth every penny. So far — after only two days — it’s all joy and no regret!

My favorite part of this transaction, aside from paying cash for the car, was that I didn’t spend all of my savings. I went into the deal with a budget of $16,768.98, and I spent $15,238.80 after taxes and fees. That leaves me $1530.18 to begin saving for something else.

Who says personal finance is no fun? I’m having a blast!

Note: I’m calling this my “starter Mini”. I plan to pursue Dave Ramsey’s Drive Free, Retire Rich program. I’ll continue to sock away money every month in my car fund. In a couple of years, I’ll be able to take that savings, sell this Mini, and upgrade to a higher-priced model. Eventually I’ll be able to afford a new vehicle!

A Night on the Town

I’ve been promising for months (years?) that foldedspace would come out of its shell. Perhaps I should stop promising that.

One way for me to get more material to write about is to actually do stuff…instead of writing. The truth is that most of my day (every day) is spent on the computer, writing for my many sites. This is profitable, no question, but it means I have little personal experience to share.

To remedy that, I’m going to make a point of going out and about, hanging out with friends. And, in fact, I did just that last Friday night.

I joined a bunch of old friends from high school (Dawne, Tom, Jonathan, Tami, Dagny, Cassie Castle, Dusty, Karin) to eat, bowl, and sing. Well, I didn’t sing, but I had a lot of fun listening to everyone else do so. I’d never experienced karaoke before, and I thought it was a lot of fun.

I had the foresight to bring my camera, so I can offer two videos for my fellow Canby alums. First up, here’s Jonathan McDowell singing George Michael’s “Faith”:

This was the first time I’d seen Jonathan since high school. It was great to chat with him and to hear his laugh. It was also great to see Tom Stewart again, who blessed with a performance of Neil Diamond’s “Forever in Blue Jeans”:

Great stuff, gents. Great stuff. Maybe I’ll polish up my Paul Simon or Johnny Cash so that next time I can join the fun…

A Frugal Dinner with Friends

Kris and I had dinner last night with our new acquaintances friends, Chris and Jolie. Dinner was fun. This was in part because our hosts made a point of preparing a frugal meal. “If you bring wine,” Chris told me on the phone, “bring something cheap. I can’t tell any difference from the good stuff.” I happily complied.

I love good food and good conversation, but the truth is I’d rather have a great talk with friends over ramen noodles than have a gourmet meal filled with awkward silences. Fortunately, we had both good food and good companions last night — and it didn’t cost a fortune.

Cooking one meal a year
For dessert, Jolie served some fantastic chocolate candies. “These are great,” I said. “Did you make them?”

“I did,” she said, grinning. “They’re just chocolate chips melted in the microwave and then topped with raisins and cranberries.”

“Well, they’re delicious,” I said. You can never go wrong with chocolate chips.

Our conversation turned to food preparation, and how different families have different habits. Some spend a lot on food. Some spend very little. Some prepare all of their meals at home. Some never cook at all.

“My mother only cooks one meal a year,” Chris said.

“One meal?” I asked, incredulous.

“Yeah,” said Jolie. “The only meal she cooks is Thanksgiving dinner, and it’s quite a production. She has a spreadsheet that lists everything that needs to be done. She has columns for everyone who is helping her, and rows that show what each person should be doing at any given moment.”

Kris and I were awestruck.

“She’s an engineer,” Jolie explained.

“What does she eat for the rest of the year?” Kris asked.

“A lot of Domino’s,” said Chris. “And Burger King. That sort of thing.”

“That must be expensive,” I said.

“Yeah,” said Chris. “But both of my parents are engineers. They can afford it.”

“And was it like that when you were growing up?” Kris asked.

“Yup,” Chris said. “Pretty much.”

The notion of eating out for every meal is foreign to me. I’m sure that people do it, but I can’t imagine the cost. When I was a boy, my family rarely dined in restaurants. My parents couldn’t afford it. We were poor. Now that I’m older, I eat out much more often — sometimes too often. But every meal?

McDonald’s every day
“I think Chris had quite a shock when we started eating at home,” Jolie said. “He grew up eating in restaurants. In college, he ate on campus. Then we spent four years overseas at a job where there were communal meals. Other people did the cooking. Eventually, though, we had to make our own food.”

Chris nodded. “When we got married, my goal was to be able to eat at McDonald’s every day. If we could do that, I thought we’d be rich.”

“McDonald’s?” Kris asked, screwing up her face.

“Those were my early days of goal-setting,” Chris said, and we laughed.

“You have to understand,” Jolie said, “when we got married, we had a budget of $30 a week for food. For both of us combined. That’s not very much. When your food budget is that small, you learn to pinch your pennies. Chris ate a lot of raviolis. I ate a lot of macaroni and cheese. And I’d buy the Wal-Mart brand because it was 33 cents per box. Kraft macaroni and cheese was better, but it cost twice as much.”

“Right,” said Chris. “And we each got $3 a week from the $30 to spend on special treats.”

“Little Debbies were 99 cents!” Jolie said.

Chris smiled. “I ate a lot of Zebra Cakes.”

I smiled, too. I was thinking of how I used to buy boxes of Jiffy muffin mixes when I was in college. Who needed chocolate cake or apple pie? Give me a 25-cent box of blueberry muffin mix and I was a happy camper.

30 bucks a week
Our conversation reminded me of a website that a friend sent me recently. 30 Bucks a Week is a blog chronicling the adventures of one couple in New York as they try to squeeze all of their home-cooked meals out of a $30 weekly budget. (This isn’t a militant experiment — the couple still eats in restaurants about once a week, and occasionally has alcohol. Those costs are not included in the $30.)

Reading 30 Bucks a Week, and speaking with Chris and Jolie, makes me realize how much lifestyle inflation has affected my eating habits. As I’ve earned more, I’ve spent more on food. My appetite has grown to match my income.

But expensive food doesn’t necessarily make me happier. Some of the best times Kris and I have had were when we were scrimping and saving, living on chicken noodle soup and Jiffy muffin mix. Though fine food can be a wonderful thing, the real pleasure of dining comes from the people you’re with. Good food doesn’t have to be expensive.

The $1500 Frisbee

It’s April Fools’ Day! In 2007, I regaled you with lifestyles of the rich and stupid. Last year, I explained how to turn $500 into $7 the hard way. And this year I offer you yet another tale of my own financial foolishness.

On the first day of college, I opened my first bank account.

The gym was filled with registration tables, not just for classes and clubs, but also for local businesses wanting to sell themselves to the students. There were even a couple of banks. Since I was getting a small payment from the school to cover living expenses, I needed to open a checking account.

The two banks had very different methods of attracting students. One displayed a sign that said “free checking”. The other was handing out Frisbees. My choice was easy. I wanted the Frisbee. (Free checking? How boring!)

I signed up for my checking account, got my free Frisbee, and spent the afternoon on the quad, tossing the disc back-and-forth with my roommates. When it was time for dinner, I took the Frisbee up to my room, put it in the closet, and never used it again. But I had that checking account for nearly 17 years.

Classes started. I forgot about the Frisbee, and I forgot about the checking account. The next month, I received my first bank statement. There was a $5 service charge, but I didn’t care. It was just $5, right? I accepted the fee as part of the package, and as part of being an adult. My parents had always paid service charges on their bank accounts, and I expected I always would, too.

I paid $5 a month to maintain my checking account throughout college. When I graduated, I continued to pay $5 a month. In the early 1990s, the fee increased to $8 a month. This bugged my wife (who had the same account), so she went into the bank and had them switch her to free checking. I didn’t do anything.

In 1998, I cut up my credit cards and transferred the debt to a home equity loan held at the same bank as my checking account. It occurred to me that maybe I could get the same free account that Kris had move to a few years earlier. I asked. They said no, the only account available for me was the one I had. I accepted this answer and kept paying my $8 a month.

In fact, I paid a monthly fee for checking from September 1987 until June 2004. For 202 months — nearly 17 years — I paid $5 or $8 a month to have a checking account. In 2004, as part of my financial awakening, I closed my accounts at the bank and moved them to a local credit union. The credit union never charges me fees at all.

During the first episode of The Personal Finance Hour, I mentioned this story. As I spoke, it occurred to me that the “free” Frisbee wasn’t really free. Not even close. Roughing out the numbers, it’s clear that this one poor choice alone cost me about $1500 — enough to buy hundreds of Frisbees.

Photo by akeg.