Pumpkin Spice Latte Financial Planning

Yes, I am exploiting the PSL (Pumpkin Spice Latte) seasonal bandwagon. I’m not the first in the financial business to do so. One of the weirdest was a link from a credit union offering Pumpkin Spice Loans. In the years since, media outlets are hijacking the seasonal treat to link to their own brands. You can also follow the PSL at Twitter-@TheRealPSL.

Now, we all know that there is just a little pumpkin (used to be none at all) in this drink, so I can use pumpkin photos to spice up this post.

Ingredients in this latte:

Pumpkin: Vegetables and Fiber (Needs)

Dairy/Dairy Substitute: Protein (Infrastructure of the Plan)

Sugar: Energy and Taste (Motivation to Act)

Seasonal Spices: Extra excitement (Yes, you can have Wants!)

Whipped Cream: the initial exposure, getting a fresh credit card in the mail, a new job or a raise or (Treats and Rewards.)

Needs

What are your monthly financial needs? Consider the Maslow hierarchy, in which his original definition consists of “air, food, drink, shelter, clothing, warmth, sex, sleep”.

1. Rent or Mortgage (cost of shelter)
2. Utilities and Communications
3. Groceries and Food (Groceries are needs-meals out are wants)
4. Clothing (jeans, er pants, are a need-a specific brand is a want)
5. Time to rest and sleep (hopefully no double shifts)

Financial Plan Infrastructure

1. Spending Plan
2. Income and Expense Monitoring
3. Revise and Adjust
4. Musts:
   1. Data Security (online banking and credit accounts)
   2. Credit History Report Maintenance and Annual Monitoring
5. Financial family meetings or date nights
   1. A family meeting can be a useful way to involve everyone in planning a summer or winter vacation.
   2. I am a big fan of financial date night. It doesn’t have to be expensive, but it is a terrific way to catch up with your sweetie on monthly goals and progress to date. It is also a way to have a planned conversation about cash flow, credit use, and new expenses. Proactive chats, not reactions are, in my experience, easier on a relationship.  This is especially important if financial tasks are divided between a couple or you handle your own money separately from each other.

Motivation to Act

1. 1. External events: job change or loss, promotion, relationship status change, current events, goals achieved, change in incentives from work or hobbies, marketing convinced you, peers or affinity group, family member asked 
   2. Internal events: ruminating, growth, illness or treatment for same, goals achieved, goals or needs changed (See Maslow)

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#NotBuyingIt: Anti-Black Friday

During this season of Black Friday, and holiday sales, I’d like to offer some thoughts on an alternative-Not Buying It. Ways to change your behavior so that you can take a step back from consumer culture. This topic has interested me for years and authors and bloggers keep coming up with new ways to…buy nothing. Most recently in 2015, outdoor retailer REI decided to close on Black Friday, pay their employees for the day, and encourage all of us to #OptOutside .

Remember Amy Dacyczyn and The Tightwad Gazette from the 1990’s? In 2009, she was interviewed by New Hampshire Public Television. (5 minute video)

2001 After 9-11, President Bush is rumored to have said just go shopping-he really didn’t say it that way; his statement was more highfalutin’-he suggested ‘continued participation and confidence in our economy.’ It was Mayor Giuliani who actually said go to restaurants and go shopping-on Sept 12^th. Then the American public was practicing patriotism at the mall, and the ball games….and then the bubble happened…

2006 was when a funny piece in the Atlantic  by the writer and actress Sandra Tsing Loh, was published.  It was called Cheap Thrills: American Women in Financial Jeopardy. It was about women and money, Individual Retirement Accounts  (IRA’s) and shopping. Tsing Loh wrote about her friend Carolyn, who wanted to lose weight and proceeded to lose 12.5 pounds in three months. She also lost a lot from her wallet. Fees and food from Jenny Craig, some nice running shoes-only $100, a new haircut, a gym membership at $40/month etc. And last but not least, the new $300 distressed jeans in two sizes down-only $300.

It cost her $196.50 per pound.

I can distress anyone’s jeans for less than $300, just sayin’.  By the way, by her own admission, Tsing Loh comes from a very cheap immigrant family-her sister once gave her a library book for Christmas with a time limit on it for return.

2006 Judith Levine in her book,  Not Buying It: My Year Without Shopping, links her shopping memories to Sept 11^th as well-“Buy that big screen TV or the terrorists will have won!”

Not Buying It Judith Levine (Photo credit: Gauravonomics)

2008: Remember September 15^th 2008 when Senator McCain was feeling Presidential and said “the fundamentals of our economy are basically fine, despite tremendous turmoil…just before Lehman Brothers declared bankruptcy. Recession and many people have struggled with their finances-fair, fowl or fun money. Still are-According to Al Lewis’s Emporium WSJ column, the people wrote in to say two words: We’re broke.

“We want to maintain our financial strength, not transfer it to the mass market retailers.”

— “I already own 50 neckties, three cars, four TVs, etc. Why should I blow money on Chinese junk at Target and Wal-Mart when I can save money for retirement?”

2008-2010 For many of us, the Great Recession changed our buying habits, albeit involuntarily.  However, there have been many enlightening stories written in the last 15 years about people’s voluntary changes in their relationship with consumer culture, stuff and even patriotism. Before that it was Voluntary Simplicity, a movement pioneered by authors Cecile Andrews , Janet Luhrs, and Duane Elgin, among others.

In summary, whether you  reduce your things down to 100 for a year, (2012 link to TedX video from author Dave Bruno) or some other number, go cold turkey like Judith Levine and her husband did for one year, stop spending $200/pound to lose weight or some other self-improvement scheme, try something new this holiday season. Maybe you have gotten very good at substitutions (library for bookstore) (brand declines-Nordstrom to Macy’s to Marshall’s to thrifting)  You can observe Buy Nothing Day on Black Friday – and on Thanksgiving.

You and your family could even introduce these ideas around the Thanksgiving table for some lively conversations. I’d love to hear how that works!

What to talk about, besides football and turkey?

Related articles

• 11/16/2013 Shopping Log, Or the First Anti-Shopping Log (extremecheapness.wordpress.com)
• Thanksgiving shopping ruffles Facebook readers (pressrepublican.com)
• http://www.pbs.org/kcts/affluenza/ 
• http://www.zipcar.com/ziptopia/around-the-bend/10-things-to-do-on-black-friday-besides-shop 

Resist this Faux Fall Color: Pink!

A shopping  item from The Detroit Free Press ran in my local paper this weekend, touting the inevitable pinkwashing that goes on during October – Breast Cancer Awareness Month. As a survivor myself, I fully support awareness, mammograms and health insurance that covers annual exams for women. However, like a good annual physical, it pays to cover all the bases-including faux philanthropy by corporations.

The title was ‘pink’ products that really give back. It began with a brief note to check out any charity recipients of product sales on charitynavigator.com, then went on to highlight 5 products to that “caught the writer’s eye.”

I want to single out one of the suggestions in particular-for True Religion Halle Super Skinny Breast Cancer Awareness Jeans retailing for $198 a pair. Again, quoting from the “article”/marketing puff piece, “The company will donate 10 percent from the sale of each pair of these skinnys to Susan G Komen for the Cure, with a minimum donation of $35,000.” That means they are willing to give 10 percent of the proceeds from 1,767 pairs of jeans to Susan G Komen, a company still reeling from branding problems of its’ own. How many hours of sales is that?

$35,000 is a shockingly low number for a donation from a corporation with $467 million in sales last year (2012). In July 2013 True Religion was acquired by a hedge fund,  aka a ‘private equity fund’, called TowerBrook this year for $824 million. (The stock had traded under the symbol TRLG until the merger.)

A donation of .0042% of the sales price-824 million dollars! Very generous indeed, True Religion!

(As 82% of the funds at Susan G Komen go to the “cure”, the real number going to “support breast cancer” is $28,700.)

Note: To my knowledge, I have never owned any shares of TRLG in the past, as individual shares or in a mutual fund. I am not now invested in any private equity funds.

Related articles

• Pink envelopes Metropolitan Park during Susan G. Komen Race for the Cure Saturday (jacksonville.com)
• WTF Internet? A tweeting bra is not helping cure breast cancer (digitaltrends.com)
• The PinkSploitation of Breast Cancer Awareness Month (upperstclair.patch.com)
• True Religion Breast Cancer Awareness Jeans – The Halle in Pink Ribbon (denimblog.com)

 

Walden on Wheels # 2: Van Dwelling Grad Student

To save money, Ken Ilgunas lived in his van ( “an upholstered hermitage” ) while he attended Duke to get a Masters in Liberal Studies…and kept it a secret. Ken Ilgunas is the author of Walden on Wheels. My earlier post addressed the first half of Ilgunas’s story-how he got rid of his undergraduate loan debt.

“The Creepy Red Van”

He made several pledges to himself:

• First: “In order to live debt free in my van, I’d have to lie”. The first rule of van dwelling-is don’t mention the van dwelling.
• Second, he vowed not to accept any gifts, even though his mom offered to pay his rent so he didn’t have to live in the van.

“I didn’t think of a gift merely as a gift but as a debt with bow wrapped around it.”  “When we accept a gift, I thought, sometimes we don’t just acquire a debt but an identity.”

• Third, he continued his life as an ascetic by giving up meat, dairy and beer; and joining the campus gym (for exercise and showers) . [I say ascetic for his purposes-not everyone who gives up meat is an ascetic].

The burden of lying by omission to fellow students about where he lived and being worried about whether the campus police would kick him out of his permitted parking space took a distinct toll on Ilgunas’s social life. After two months like this, he had a  “surfeit of solitude”. When you read the book, you can see how he solved that problem.

In addition, he was living on $103/week, not counting tuition and other school fees. According to charts in the book, he spent $4.34/day average on food. For reference, the dollar amount for a person using SNAP (food stamps) is $31.50 per week or $4.50/day.

(Photo credit: Wikipedia)

As listed in the book, his monthly expenses consisted of: car insurance $46, entertainment $33, vehicle costs/repairs $73, gas $23, misc. $65, food $132, cell phone $37.

Notice: no utility expenses, nothing on clothes, no long commute.

You might take a moment to jot down your own expenses and see if there is any place to cut without being as Spartan as Ilgunas. What I learned from the book is that many of us with  “first world problems”, live a relatively easy life. For those of us with larger debts, Ilgunas demonstrates the value of being absolutely focused on one’s priorities and ultimately learns another lesson as well:

“If I wanted to stay close to nature and my true needs, I would have to continue to live a bare-bones, simple uncluttered lifestyle.”

Without adopting a ‘bare-bones’ lifestyle, there is value in seeing how others accomplished their goals. J. D. Roth, the founder of the finance blog Get Rich Slowly wrote about getting rid of his $35,000 in debt in 2007. Whether you choose to stop using credit;  adopt a lite beer vs. microbrew budget; sell most  of your possessions ; leave the country; or live on only one income (if your family has more than one revenue stream), there are other people who have vanquished their debt. It is very hard, but you are not alone (unless you want to live in your own van).

Related articles

• Dorm, Shmorm: Meet the Guy Who Lived in a Van for Two Years During Grad School (business.time.com)
• Walden Pond in Concord, Massachusetts (atlasobscura.com)