Wednesday, December 7, 2016

Amazon Go (Away)

So Amazon is opening a new store where you don't have to pay for anything; you just go in, pick up what you want, and leave, and your purchases are automatically charged to your Amazon account via an app on your phone.

I think this is a terrible idea. I have documented previously why I am anti-Amazon, but I would think this was a bad idea no matter who came up with it.

First, the system relies on extensive surveillance, more than I am comfortable with experiencing in a public place. A series of cameras and microphones as well as tracking software is needed to make this experience seamless for the end user, but surveillance technology is still not perfect, and I see this system as rife for abuse. (Good information about that technology here, but be warned that video and audio autoplay when you load the page*.)

Second, all of this technology replaces real, actual jobs that could be employing human beings. And at least in the beginning, that technology is going to be more expensive than humans, so there will not be any real savings to pass along to the consumer. I expect that Amazon will operate as it has before and take a loss on products to establish itself, then take a monopolistic approach to its vendors, forcing them to operate on its terms.

Third, and most important from a personal finance point of view, is that removing the barrier of paying means removing the psychological understanding of what has transpired in the transaction. We already know that paying with a credit card causes us to buy more than when we spend cold, hard cash. What will happen when it doesn't feel like we're paying anything at all? I presume the app would allow you to see your total as you shop, but the video makes it look like you don't need  to think about what you're spending at all, and that's dangerous territory.


*Which was a good incentive for me to install a browser extension that blocks that from happening. It worked so nicely that I'll be installing one on all the browsers on all the computers that I use regularly.

Saturday, December 3, 2016

Book Review: Essentialism

Essentialism is, well, an essential little book. It could be summed up as "less, but better". I liken it to The Lifechanging Magic of Tidying-Up for its inspiring but still very implementable message.

Author Greg McKeown offers insight and advice on how to change your entire mindset from scarcity and FOMO to determining what is essential for you and ruthlessly (but politely) carving out that which is not. Most of us, I think, are aware of when we are getting stretched too thin, and we can even identify the causes - bosses who pile on the work, friends and family whose feelings matter to us, an expansive desire to have it all. But we don't know how to deal with being pulled in all of these different directions in a way that allows us to keep our jobs, our relationships, and our contentment intact.

Essentialism answers those difficult questions and more. As a rallying cry, as a practical manual, as a manifesto, a call to action, and a muse, this one is highly recommended.

I got my copy from the library, but am keeping an eye out for a copy to own as well. Support your local library, indie bookseller, or brick-and-mortar bookstore!

Wednesday, November 30, 2016

About those consignment sales...

When Pickle was born and people starting giving us bags and boxes of baby clothes, I just did not understand it. That stuff was WORTH SOMETHING. And they were just...giving it away! I cleaned, used, and then sold most of it at kids' consignment sales, after passing on the favorites to the other little babies in our family. I just could not wrap my mind around the fact that people would give away such great stuff with abandon.

I get it now.

Currently, I am staring at three boxes, three grocery bags, and a small pile of things too big to fit in those containers. That doesn't include the high chair and tiny potty on the kitchen floor or the two ride-on toys, the two baby strollers, the infant clamshell car seat, and the exersaucer thing in the basement. Nor yet all the rest of the toys and clothes that are scattered around my house, not being played with or worn or otherwise useful to anyone on the planet. Not only will I donate this to the next expecting parent, I come across, I would gleefully PAY someone to take it all out of my life.

That's how much kids' stuff multiplies as the kids get older and more numerous in a given household.

Last year, the consignment sales still seemed like a good use of my time but I just can't anymore. The time it takes to clean, repair, hang, catalog, price, tag, load, unload, inspect, and wait for payment on the stuff is just too much. My hourly rate at work is too high to justify taking time off to manage it, and my time not at work, I'd rather spend with my kids than trying to make money off of their used stuff.

This grates at me a little bit. I like to find efficient ways to use my time and effort, and giving away valuable stuff doesn't seem efficient (it is, of course, when compared with the frustration I experience during the course of doing all that stuff, but it's not efficient from a dollars-in perspective). I'm trying to look at it as paying forward all the generosity that was displayed towards us, which helps. I remember the delight I experienced going through a giant trash bag of adorable baby girls' clothing, and hope that someone will feel the same looking at Baby Bear's cute little newborn pajamas. I will try not to think about the $79.08 (or $1.21 hourly rate) I might have otherwise earned. And most of all, I will luxuriate in having no piles of baby crap anywhere in my vision for at least three or four hours.

Sunday, November 27, 2016

Too Bad, Toys R Us

I get that the competition is fierce out there in Black Friday world. I really do; I run an e-commerce site as part of my job and make decisions about policies, promotions, and discounts on a daily basis. But one thing that I focus on both personally and professionally is customer experience, and Toys R Us just gave me a bad one.

Baby Bear's birthday is coming up, as is Christmas (in case you hadn't noticed?) so my mother-in-law and I went to Toys R Us to pick up some presents today. I checked the Toys R Us website before we headed out to make sure that the specific item I wanted was in stock there, and happily noticed that it was both in stock and on sale. I checked the website's price match policy to make sure that the online price would be honored in store, and saw that it was. We got there, picked up what I wanted as well as a cart full of other presents, and headed to the checkout.

At the register, the cashier confirmed that the store would match the listed price on their website. And he was able to do so for the first item he rang up. But the second item, the one I'd come for, he couldn't make the computer match it. So he called over a manager, who said that Toys R Us would not be price matching their own website this weekend, due to all the Black Friday sales. He said there was a sign near the front of the store that said so (which I never did see, though I looked for it when we left). I showed him the price matching policy on the Toys R Us website, which had no such disclaimer on it, but he shrugged and said there was nothing he could do.

Obviously, front-line retail employees have no ability to influence the corporate decisions that are made regarding things like this, and often no ability to force the computer to make an exception to a dumb rule that's been handed down. But come on, Toys R Us. It is not that difficult to update a page on your website when you make a major policy change like that, even when it's temporary. It's reasonable to expect that customers will look at your policy online while they are shopping in the store, rather than for a notice tacked to a random bulletin board near the door. Frankly, I think the policy change is a stupid one overall - if your P&L for a promotion only works if you force weird restrictions on it, plan a different promotion. The extra stupid thing is that if I had ordered and paid online but requested in-store pickup, the price would have been honored but the employees would have had to do even more work than if I went and got stuff off the shelves myself.

I kind of wish I'd thought of this option and bought the items through the website while I was standing at the cash register, but in the end we made a decision I feel even better about - I canceled the entire transaction and I bought the item I wanted from a different retailer. I don't do business with companies that create policies and promotions that don't have the customer experience first and foremost. The short-sighted decisions to temporarily invalidate the price matching policy AND to not appropriately notify customers of it wound up costing Toys R Us way more than the sale price of the item I was looking for - they lost today's entire sale and any future sales they might have made to me. Next time I need to buy a kids' present, guess where I won't be going?

And as a bonus to this story, when we got home and related this story to my siblings-in-law, we had a great discussion about consumerism in general and decided to scale back our overall gifting within the family. Now the little kids will get presents from Grandma and Grandpa (and Santa) but not aunts and uncles, which means that I don't even need to do any more shopping to replace the cart full of stuff that I didn't buy today. So...I won't even miss you, Toys R Us!

Saturday, November 26, 2016

Black Friday Sale

We didn't go Black Friday shopping - or at least, we did go to some stores, but we didn't go in search of doorbuster deals or anything like that. We went in search of bread, milk, and grounded outlet covers - or, the kinds of things we might buy on any other day.

One Black Friday sale I DO recommend, though, is Plan to Eat's 50% off deal.

Simple Meal Planning - Plan to Eat

Plan to Eat is a meal planning and recipe collection website, which I started using last year when a friend posted a link to the 50% off Black Friday sale. I couldn't imagine paying for a service that I could do for free with Pinterest, Google Calendar and Google Keep - but she recommended it so strongly and is a frugal stay at home mom, so I figured it might be worth trying it out, especially given that the sale price winds up being only $1.62 per month. I figured I was wasting at least that much a month with failed menu planning.

And guess what - it IS worth it! Yes, you can gather recipes on Pinterest, plan meals on a Google calendar, and create a shopping list in Google Keep, all for free. But it's just not as convenient, easy, and - dare I say it - fun to use as Plan to Eat.

I put their "add to Plan to Eat" bookmark to my browser windows and voila - all those recipes I had previously been starring in my feed reader and adding to Pinterest boards suddenly wound up all in one place. I revised the standard shopping list to include those staples I prefer to have on hand. Weekly, I created a menu within Plan to Eat, which told me how often I'd made a given recipe and whose search tools quickly helped me organize recipes I'd been wanting to try. With one click, I could create a shopping list based on those recipes and the staples I currently needed. Bam! Menu planning to grocery shopping, done, in one step.

I'm not the one who does the meal planning in our house anymore, but I'm still going to renew my subscription to Plan to Eat, because I found it that helpful. I rarely pay for software tools when free ones exist to fill the same needs, but this is one that actually delivers.

(Disclosure: Links in this post are affiliate links, so if you sign up for Plan to Eat, I get a little something. However, this is not a sponsored post, and I really have been a happy Plan-to-Eater for the last year. )

Tuesday, November 8, 2016

Five frugal things

1. Our dryer stopped working - it spun but had no heat. Peanut took the whole thing apart and identified a likely problem, ordered one part (even with next-day shipping, it was cheaper than buying it locally, sadly) and replaced it. That wasn't the problem, so he went on to the next small part, which he was able to get locally, and bingo! A $30 fix, and enough understanding of how our dryer works now that we might be able to keep it going forever. WAY better than a new $300 dryer!

2. We managed to be realistic about how many trick or treaters we'd have this year, and didn't overbuy candy to the extent that I have done in the past. I'll say it here for posterity: one bag is plenty. (There is a commercial district near here that does trick or treating, and maybe that's why we don't get many kids at our house - we had more than last year, but still under twenty, I'd say.)

3. I voted last week, at one of the early voting centers available in the state of Minnesota, where you don't need a reason to cast what is effectively an absentee ballot. I consider this frugal because I saved time (and time is money!). Also, if I'd had to wait in the lines today, I would have ended up eating my feelings in purchases snacks, so in a way, it saves me money too.

4. Working hard to bring my lunch every day - I usually get frozen lunches at the grocery store for about $2.50 each, or I take leftovers. Compared to $8-10 for a lunch downtown, it's not bad!

5. I control a large budget at work, and we are in budgeting season for next year. I am so thankful for the experience I have in being actively involved in managing my personal finances, because this would be a very difficult task if I didn't have that background. Pro-tip: take a personal finance class in college if you can; it actually might help you more than your general ed requirements!

Friday, October 21, 2016

Health insurance

When Peanut decided to stay home with the kids, we had to switch from his company's insurance to mine. It's been fine so far but it's really interesting to see the kinds of things we have to think about now that we didn't think about before.

Peanut's job paid for the entire premium for our health insurance. I have never seen that as a perk anywhere before, and it was awesome. It was a high deductible plan, but even so, the deductible wasn't that high (around $3,000) and the coinsurance/max out of pocket was an additional $3,000. Pretty much everything we ever threw at it was covered, and we didn't need to get referrals or anything. This is the insurance we were on when Pickle was born, and for the first couple years of her life we didn't have to pay that due to the state medical assistance she received. In all, that health insurance company paid out at least $1.5 million in claims for our family and we never had a single problem or issue with them at all.

So I was a little nervous about switching to a new health insurance company.

My job shares the premium payments with the employees, and both the deductibles and max out of pocket were higher than our old insurance. This is why at the end of the day, our take-home pay situation hasn't changed much even though my salary on paper is 14% higher than Peanut's was. On top of the increased actual cost to us, we also had to make decisions about primary care networks - one of which means we have to do a lot of legwork to get referrals documented appropriately but save $90 a month, or the other one that works more like the old plan worked where we just go to wherever we want for whatever care we need, but we pay for the privilege. If Pickle still had lots of specialists, we'd probably have to go with the latter, but we decided to take on the work ourselves of managing the paperwork and having slightly cheaper out of pocket expenses up front.

And it turns out, I'm really glad we went that route. We haven't needed and don't expect to need any referrals in the next three months, and it was just announced this week that in January my company is switching to yet another insurance company, which will have lower premiums and out of pocket expenses than we currently have. I don't know about their referral requirements yet, but I do know that we haven't spent any time to set up any primary care situations with our current insurance (at least not for Peanut or me) so we will have saved more than $300 to do nothing but take on a little risk.

Insurance was never something I thought a lot about, until we really needed a lot of it. We are so fortunate to have had such a good experience with an insurer (and a secondary state insurance) and it has drastically changed how I feel about that out of pocket amount now. I assume we'll spend it all in a year (4 out of the last 5 years, that's been true). I can start a year knowing that our max OOP is $6,000 or whatever, and just think, okay, that's about $500 a month for four people for all of the medical costs we can expect to have in a year (add in premiums and it's probably double that, but pre-tax stuff is so removed from my daily consciousness that it's like it doesn't exist). It's an easy way to budget for it, whatever we don't end up spending is bonus to our bottom line, and it takes a lot of the emotions and politics out of it.

I wish I could solve the health insurance system for everyone, but that mental shift has done a lot of solving it for our own budget. I used to begrudge paying anything on top of premiums for some reason, and now I treat it more like a sunk cost. The rest of it is a racket, but the perspective helps me deal with the bills that come in for an emergency room or urgent care visit.

Tuesday, October 18, 2016

Sold a car!

We sold one of our cars - the sedan that I complained about 18 months ago. We sold it to a family member for about half the blue book value, as a favor to them and also to us, because then we didn't have to do anything in terms of work but vacuum it out and sign the title. No advertising, no test drives, no worrying if someone's cashier's check is valid. That car has a lot of life left in it, and while I hated getting kids in and out of it, I feel a little guilty about getting rid of it before it was really and truly driven into the ground. I have actually never sold a car before - both of my previous vehicles were donated as scrap because I drove them until they didn't work anymore.

We still have our Rav 4 and the Jeep, which is stored for the winter. We should be getting a refund on our car insurance for the sedan and the Jeep, since we pulled insurance off it while it's stored.

It's been a bit of a shift to go from being used to each having a child-safe car we can drive to only having one of those, but not too bad. Peanut has taken up biking around our neighborhood which is great in a number of ways. We'll probably use some of the money from the sale of the sedan to upgrade his hand-me-down bike and get a nicer bike trailer for the kids, but bikes are definitely a lower-cost commuting option, when your commute is five blocks to the local preschool!

I take the bus most days, which is way cheaper than paying for downtown parking, way better for my mental sanity since I can read on the bus instead of glower at other driver's from my own car, and also helps me leave work at 5 on the dot every day. I had forgotten how nice public transit can be, and it's weird how easy it is to fall prey to the notion that I "need" to have my own car for going to and from work, where I pay $14 for the privilege of leaving it all by itself for nine hours. I am also getting so much more reading done!




Time-poor

It seems like you're usually either strapped for cash or strapped for time - or both, but rarely wallowing in an excess of either.

At any rate, I'm now time-poor even if we're doing okay financially. I was thinking the other day about how my idea of retirement is basically that I still want to work but I just want to control my own schedule. I don't know what job is out there that lets me do that, but that's what I want to retire to. Peanut on the other hand has more time on his hands than probably ever before in his life and he's enjoying it. I don't quite know how he has so much time to do projects he wants to do, because I sure didn't feel like that when I was staying home with kids! But I guess they are almost a year older than they were when I was last home 24/7, and they are getting better at entertaining themselves every day.

It's budget season at work. This is the first time I've ever had to manage a budget at work, and I'm really glad for the practice I have of managing our personal budget in such detail - I don't know how I'd cope otherwise. There is very little guidance or oversight of the budget creation process, but a lot of nit-picky details. I sat down today and did some SUMIFS and pivot tables to take a lot of the manual labor out of the process - and a project manager actually got teary-eyed at the amount of time Excel could save her now going forward. I thought it was maybe a bit of overkill to have pivot tables in our own private budget, but I'm glad now that I knew how to implement them at work.

Our spending is already down quite a bit in the last two months -between not having a nanny anymore and the savings we see from me not eating lunch out as much as Peanut did, we are enjoying feeling a little flush. After we pay bills this month we're going to max out one of our 2016 Roths, which will hopefully scratch the itch of wanting to spend without that spending being wasted.

I got a new cell phone and switched to Ting. My last phone was having some battery problems (totally dead by 3 p.m. even without being used at all), although I kind of wish that I'd tried harder to find a solution to fix that phone. Change is really hard for me and this sounds so stupid to say but I've had a lot of stress and anxiety about finding and getting used to a new phone. The savings from being on Ting is nice (and my old phone couldn't work on Ting), so that helps.

Trying to explain money to kids is hilarious. Pickle kind of understands it (she knows you can exchange it for stuff but has no concept of value) but Baby Bear has no concept at all. All he knows is that dogs don't use money because they don't have any pockets to keep it in. Ha!

Tuesday, September 6, 2016

Role Reversal

Today is a big day in the Moneybags household. Today, I become the breadwinner, and Peanut becomes a stay at home dad.

Yay!

It's an option we talked about before we had children, and again when our kids were born, even though it seemed unlikely that I'd end up making more than him at any point (I have an advanced degree, but picked a not-lucrative field). But that's the situation we are in, surprisingly, so when our nanny gave notice a few weeks ago, we decided to go for it rather than find another paid caregiver.

It puts us almost exactly in the position we were in a year ago, when Peanut was the only wage-earner. My income is higher but my health benefits are more expensive too, so it comes out to almost exactly the same take-home pay. We'll be able to save some and live well. The kids will benefit from seeing a man as the primary caregiver (it's weird to think that if they remember any parent staying home with them, it will be Peanut and not me). I will benefit by not having to stay home, and by turning over a lot of the housework to Peanut. Peanut will benefit from getting to experience primary caregiving and getting a break from a career/job where he was getting burned out. We'll both benefit from walking in the other's shoes for a little while. Our nanny benefits by getting to do something she's always wanted to do (she didn't leave us for another family but for a unique job opportunity overseas). Everybody wins!

Probably the most challenging thing about it will be for me to let go. Peanut is a #1 fine dad, and he doesn't need my "help" or advice. I don't want to be one of those moms who leave a list when the dad "babysits". We've been talking about which chores we'll each do (when Peanut worked and I stayed home, I did everything but yard work, but the reverse doesn't make sense) but other than that, I am mainly looking forward to never having to make dinner again! (And so is everyone else.)

Sunday, August 21, 2016

Retirement Savings: Mission Accomplished?

There are so many ways to look at money, particularly at what is "enough". I've been thinking, reading, and writing about money for a long time now, but I always love coming across a new perspective that resonates with me, particularly when it comes with a pleasant surprise related to my own financial situation.

One example of this is the question how much do you need to save for retirement? Well, enough to retire on, obviously. We've calculated this out a couple different ways, and have a number in mind, which is about 10 times more than we currently have in retirement savings. It feels like it's so far out of reach. We're in our mid-thirties, and in the last ten years we've managed to put away a six-figure amount in retirement savings, but if we're trying to make to a seven-figure amount...sometimes it hardly seems possible.

Then Peanut stumbled upon this post from Mr. Money Mustache, The Man Who Didn't Realize He Was Already Rich. Basically, a guy in a pretty good situation feels like he'll never get to his savings goal but some math shows that, in fact, he has already saved enough to retire at age 65 - even if he never adds to his retirement account again! Therefore, he is only working to meet his current needs and/or save additional money in order to move up his retirement date. That seemed like a neat way to consider our financial position, and when Peanut did the math - woo hoo! - he found that we're already there.

To put it into more concrete terms, here are the numbers:

Retirement goal: $1,200,000
Current savings: $163,000
Compound Annual Growth Rate: 7%*
Yield in 30 years, with no additional savings: $1,240,797.57
Yield in 30 years, at our current savings rate: $2,279,866.22
Yield in 22 years, at our current savings rate: $1,261,218.61

WHAT THE WHAT. (Do the math for your own situation here.)

That means that, starting today, we could re-deploy our savings (currently around 10% of our income) in a bunch of different ways - we could move our planned retirement date earlier, we could start serious college savings funds for the kids, or we could up our standard of living. Or we could continue like normal and make big fancy retirement plans. Or we could choose to take lower-paying jobs that don't provide us with a lot of extra for savings since we really only need to cover our daily expenses for the next 30 years.

In reality, it probably won't cause any drastic changes to our lifestyle. Peanut and I are both fairly conservative, so we will save more than the minimum we need for retirement. We'll continue to take advantage of the tax benefits retirement accounts and HSAs offer. We might up our college fund savings rates, and we are definitely planning to cut our income (more on that soon!) with confidence. We'll build a bigger cash emergency fund than we've had the last couple of years. I'm not really one who's been super interested in early retirement - in a way, I've experienced that by staying home with kids for three years. And it turns out, I really like working! But man, the freedom that comes along with being able to take a job for the job instead of the paycheck - that's cool.


* Despite the fluctuations in the market the last 10 years, this is actually a conservative estimate looking at a period of 30 years or longer. See for yourself, here.

Saturday, June 11, 2016

This Week's Frugal Win

I was issued a laptop on my first day of work, and I carry it home with me most nights. I noticed it was getting a little scuffed from being carried in my bag. I don't want a dedicated laptop bag so I figured I'd buy one of those slim sleeves to slip it into. I've been too busy to get to the store or even look around online when suddenly I realized that I could probably just make one super easily. So I did!

 I used this tutorial, and in about an hour came up with something super cute - for FREE.


I used leftover quilt fabric for the outside (a pattern I bought at a quilt show in Paducah a few years ago for 50% off), leftover quilt batting (I always save the scraps for some reason), and for the lining, the bottom half of a family-company-branded t-shirt (I'd used the logo part shirt to make a pair of pants for my kids a year or so ago). I still need to put a closure on the flap, but guess what - I have buttons and velcro in my scrap drawer too.



 For less time than it would have taken me to get in the car, drive to the store, look for what I wanted, buy it and drive back, I had the satisfaction of "using up" and "making do" and every time I pull it out of my bag, I am reminded of a) the trip I took with my mom and sister to get that fabric, which I love and haven't used in a project yet; b) the fun of being creative (first time in a while I've made something instead of just repairing something), c) the fun of being frugal, and d) that shopping doesn't always have to be the solution to a problem.

Monday, May 9, 2016

Our Nanny Costs

We've had our nanny for almost three months now and she's wonderful. We found her through Care.com, a website for hiring caregivers of all sorts. We pay her well and provide a lot of standard benefits that more traditional jobs have. It's a huge expense, but childcare is definitely an area where I feel justified not cutting corners.

Care.com was very easy to use to find a nanny - first I poked around at the people who were advertising themselves as nannies to get a sense of what the expected pay rate was and what types of jobs people were looking for. Peanut and I both work full time, so we need more than full time coverage, and we quickly realized that that wasn't something most people wanted to do. We also discovered that a lot of potential nannies wanted to care for kids from their homes or bring their own kids along, which I just wasn't comfortable with. One of the big benefits of having a nanny is not having to get the kids up and out the door every morning, and I didn't like the idea of having someone else's child in my home all the time.

Still, there were lots of great candidates on Care.com, so I signed up for a three month membership, which cost $63.20. A paid membership allows users to message nannies who have posted that they are looking for jobs, and also to post a job for people to apply to. I did both, and I got a TON of applications. Many people got weeded out early on - they were looking to be paid under the table, or were only available part-time, or it otherwise wasn't a good match. We interviewed four women, and made two offers. The first accepted and then had a family emergency which caused her to have to resign before she started, and the second we hired and has been with us since.

She works 50 hours a week (8am-6pm M-F) and gets paid a regular hourly rate for 40 hours + 10 hours of time and a half. She also gets five days paid sick time and 10 paid vacation days. And she gets off any holidays that we are off work, and still gets paid if Grandma comes and picks up the kids for the afternoon or something like that. This is intentional - if I'm going to book her time, then I need to pay to make sure she is available when I need her.

In terms of benefits, we don't pay a health insurance benefit (in large part because she has health insurance already, which is great for us financially - it's expensive!). We provide a car for her to use while she's working (so we don't have to transfer car seats in and out of her car), and we provide a credit card for her to use for gas and expenses for the kids. Paying for cell phone service was another common benefit we saw, but we opted out of that - we don't call or text her that often, and she already has a phone. We also withhold her income taxes and send them to the IRS, and we also pay into unemployment benefits for her. This and social security were two of the big reasons we didn't want to pay someone under the table (in addition to it being illegal) - unemployment and social security are important safety net benefits, and I expect my employers to provide them. Therefore, I will provide them for my employee.

All of the paperwork and calculations are kind of a pain, so we chose to pay for a payroll service that Care.com owns (Peanut corrected me: we use the service provided by Intuit, maker of TurboTax*). It manages withdrawing the money from our account and depositing it into hers every week, generates a pay stub, calculates withholding, spits out all the paperwork for her taxes every quarter, and will provide the tax paperwork for both us and her next year. It costs $22 a month.

Oh, right, and the question you are probably wondering most - what do we pay her? We offered $15 an hour, and she countered with $16 an hour. I was both proud of her for negotiating and kind of devastated at how much more it seemed to increase our expenses. In the end, I realized it was only about $2,000 a year - and I really was proud of her for negotiating! We settled on $15.50 an hour, which is only for those first 40 hours - after that, she gets ten hours at $23.25 per hour. All told, she's grossing about $43,000 a year (more than I made at my last job!). With taxes and the service fees, we're actually paying out just under $47,000.

It's a lot of money.

It's more expensive than the most expensive fancy daycare that we looked at. To us right now,though, the benefits of having a nanny (not having to get the kids out the door in the morning, not having them around lots of other kids and getting sick, them getting to go out to parks and storytime and develop a close bond with a single long-term caregiver) are so worth that cost. It feels right to me to pay someone a living wage to do a job that's really hard. And, astonishingly...even after paying her, I am STILL making more than I was at my last job. So it's not like we're missing the money; we're still coming out ahead.


I love this division of labor - payroll and taxes and all of that is his responsibility and while I have access to all the information through Dropbox and our finances spreadsheet, I know that he's taking care of it so I haven't bothered to memorize all of the details. Participating partner FTW!

Thursday, May 5, 2016

Women at Work: Sexism, money, and career

I just finished this really excellent book, What Works for Women at Work, and I feel like I need to talk about it with someone.

I've had kind of a weird career, maybe, in that for the first time (after about a decade in the workforce), my direct supervisor is a man. Previously I've always reported to a woman, and in most cases, those women also reported to women. Three of the four CEOs at my various jobs have been women. Most of the people in my master's program were women (easily 75%) and even more of the professors were women (easily 90%). Publishing is pretty heavily dominated by women in all divisions, so my experience isn't unusual for the industry but it's in no way representative of business as a whole, even in the United States in 2016. That's sad but it's a fact. What's also startling is that there can be a lot of sexism (conscious or unconscious) that holds women back, and is even perpetrated by women against women - and I was pretty startled to find myself in some of the examples given in this book.

What Works for Women at Work was written by a mother-daughter team and is based on social science research and interviews with women in different places in their careers. They've identified four buckets of sexism and have strategies for coping with each. The four buckets are Prove-It-Again (how women's past accomplishments aren't enough to gain faith in their future accomplishments whereas men are often promoted based on their potential rather than their accomplishments), The Maternal Wall (and rather simply decrying the way society isn't set up to accommodate families, they talk about the unconscious attitudes we have towards women who work and women who have children and how we need to resolve those), The Tightrope (how women get typecast as either a bimbo or a bitch), and The Tug of War (how womens' issues in the workplace are exacerbated by generational conflicts and other ways womens' actions can support or hinder progress for women as a whole). There's also a chapter about the additional bias faced by women of color which was super eye-opening for this white girl.

As an employee, I've not often had cause to think that I might be the target of sexism in the workplace. I've had to deal with a twinge of it since becoming a mother (worrying about what people might think when I went back to work while Pickle was still in the NICU - shouldn't a good mother stay at her side? Never mind that Peanut had gone back to work within a few days after her birth, and no one was judging him for being a bad father for doing so). I've also had to consider whether sexism would prevent me from re-entering the workforce in a way that would keep my career on track (thankfully, that didn't end up happening - but it was definitely harder road to get a job with a three-year gap on my resume). But on the whole I haven't bumped up against outright visible sexism.

And I think that's why this book is so important - because it showed me areas of unconscious sexism that I not only have encountered by have been guilty of perpetrating myself. I have noticed how my perception of a female colleague starts to change upon learning she has children, whereas my perception of a male colleague does not. I don't think that the woman is less competent; in fact, it's almost always the opposite - but why should it change only for women and not for men? I've also made assumptions about whether female colleagues will announce a maternity leave shortly after getting married. I've never done anything besides make those assumptions, like give them bad projects or anything like that, but it was still surprising to realize that as egalitarian as I like to think myself, I've got unconscious bias just like everyone else. The first step to eradicating it is to become aware of it, and What Works for Women at Work is so helpful at bringing that awareness about.

Saturday, April 2, 2016

Feeling the FIRE

Peanut and I have decided to set up a BHAG - a big hairy audacious goal for ourselves. We're going to aim to retire in twelve years.

We probably won't actually retire - but we want to be capable of doing that. Peanut stumbled upon a post at Mr. Money Mustache about the simple math behind retiring early, and we realized that with my job, we can actually pull this off. By saving 65% of our take-home pay, we can stop working in our mid-40s. It'll probably take us 18 months or so to get to the point where we are saving a full 65% of our income (because we need to do things like build up the emergency fund and pay off the car) but given that we're used to living on one income and have managed to pull off big financial plans before, this seems within our grasp.

To sum up, we'll need to basically keep living as if we only have one income, and save the rest of our money in official retirement accounts and other types of investments (because we won't actually be eligible to withdraw from retirement accounts by the time we're ready to retire). We'll have to pay off the car, have a healthy emergency fund, and not increase our housing expenses (we could also focus on paying off our entire mortgage instead of retiring, but we're not focused on that because Reasons). We likely limp along with a 30% savings rate for a couple of years until we no longer have full-time childcare expenses - that accounts for as much as 30% of our gross income right now. Once the kids are in school, it will feel like we got a huge raise!

I wouldn't say we've been floundering about without a financial goal, but "pinch pennies to be able to save a few hundred bucks a month on one income" is not a super inspiring way to manage one's money. "Bust our butts for the next decade to be financial independent forever" is WAY more exciting. Financial Indepence Retire Early - that's something to get fired up about!