Sunday, 26 March 2017

Breathing Room Money


I've heard this called something else involving a common expletive but you know what I mean.   Some people also think of it as a financial cushion or an emergency fund but it is more than that.    It's for the more major hiccups on the road of life that for some people end up being a chasm  from which it takes years to claw their way back up to the road.   I read an article a while back in (I think) The New Yorker about people who went from parking ticket to destitution and jail in relatively short order.   I think the article was more about the country's justice system and the delegation to private collection agencies and their unreasonable power.  For people living on the margins financially and earning $7 an hour a $200 parking ticket is an impossibility.     When tickets are farmed out to a private service with few scruples it becomes nightmare.   Every month without full payment adds a $35 service charge plus interest.   Other made-up charges accrue and before long the amount owing is in the thousands.   A couple of months in jail for failure to pay means eviction from your home and your children in foster care.    You develop a chronic illness in the jails and your children pick up criminal habits while in care.  Was the $200 parking ticket worth it to the state?

Usually 3 to 6 months is suggested as a financial cushion.    Back in the days when money was worth more I had the goal of accumulating $10,000 as the amount that I figured could support my family for a year of frugal living.   Attaining this goal was a tremendous relief.    I couldn't imagine a calamity that I would not be able to solve in a year's time.   For me it was similar to what some people feel with an insurance policy but for me, I knew for sure the money was mine and would be there for me should the need arise.

Sunday, 19 March 2017

Twenty-five percent gratuity


Tips (or gratuities) can be a controversial topic.   Some parts of the world, like Australia, don't subscribe to this custom which is viewed as something Americans dreamed up.   Others, like France, include an automatic service charge of around 20%.   Watch out that you don't add an additional tip if you are visiting.    Some travel guides recommend that in addition to the included service charge you round up the bill so that if it is 18.20 Euros (probably not much of a meal in France) you leave a 20 Euro note.

In Scandinavian countries tips were called drikkepenge or drinking money.   It was often the coin change from a bill and the idea was that the server would accumulate enough over the course of an evening to have a few drinks himself after work.  Wikipedia has a country by country guide which can be useful for world travellers.

Some jurisdictions justify a lower minimum wage for servers under the theory that they will end up with more than that by including tips.    Generally, servers in mid-range eateries expect to double their wage with tips; higher end restaurants and bars and expect exponential returns.   Most only declare a portion of the tips received - 10% is standard.   The tips received are distributed by an internally decided formula so that bussers, hostesses, cooks and dishwashers share in the largesse.  Some establishments have servers tip out on their gross sales which can be unfair if a large table doesn't tip at all.   The tip portion for the rest of the staff comes out of her other tips.   In a less than friendly restaurant there's room for abuse and revenge.  

Cruise ships add standard amounts to each passengers bill--something like $14. per person per day.   On a two week cruise a couple would pay almost $400 in gratuities.   An additional 18% is charged on bar purchases.   Most people appreciate the service provided by staff but there can be some resentment at feeling that customers are making up for low wages paid by ships flying flags of low wage nations.

I've read that in New York City, twenty-five percent is the standard gratuity in restaurants.

One objection that is raised concerns the many low wage occupations that do not receive tips.  What is the solution?

Friday, 10 March 2017

Spending Fast

Some people choose January as the month to go on a spending fast or buy nothing month, but any month would work.  You can't avoid paying your rent or mortgage and other key expenses but  all non-essentials are eliminated.   Of course, deciding what is essential can be difficult.    You have to be honest with yourself.   Would your life be seriously impacted if you didn't buy x?   Can you borrow it?   Can you buy it used?  Those are all preferable to retail price plus sales tax.

We all have our particular weaknesses and it is best to acknowledge them.   I have no particular interest in tools or cars but a shiny new catalog from LL Bean can definitely tweak my interest.  My intention was just to look but before long I found something--actually a few somethings--that would definitely enhance my wardrobe.   Fill gaps.    Go with something that was lacking something to go with.  

The Current U.S/CAD exchange rate is one thing that definitely gives me pause but LL Bean does make good quality long lasting clothes.   I would be getting my money's worth.    Pause . . . pause.
Trying to decide what to do I was reminded of the time an aunt sent me home with a good three quarters of an enormous Black Forest cake that was left from a social occasion she was hosting.   How many calories did that contain?   How many snacks and desserts and little side pieces would I end up eating from it?     In a burst of inspiration I picked it up, ran out to the garbage bin (in my slippers) and tossed the cake in.    It was an enormous relief.    I decided to recycle the catalog, but quickly.

A fast of any kind is meant to be short-lived.   A trial run in case you were ever in serious trouble.   Valuable information  is provided to see just how low you can go.  But you're in charge and get to decide what you missed the most and don't want to do without.

Friday, 3 March 2017

Charity begins at home



Charity begins at home.  Here's one definition:

A proverb that expresses the overriding demands of taking care of one's family, before caring for others.

That begs the question:    To what extent does one take care of one's family before stating the job's done.   There are always improvements that can be made in accommodation, education,  food and amenities.    You child might be graduating with a doctorate at age 30 before you consider you have finished.    Does that mean all other worthy causes and endeavours are postponed until then?

But, let's be reasonable, you say.   No need to provide the also proverbial silver spoon.  Moderation in all things even though nowadays that can be expensive.   Standards have gone up from the crust of bread days.    Modern families do not view their children as prospective workers on the family farm.

Raising children takes  money and time.   It is an important job albeit society doesn't provide a reward for a job well done.   No, parents of grown children who  have become productive and happy citizens can pat themselves on the back but there is no government cheque forthcoming.   No attached note of thanks for the money that has been saved by the state in resources not required.   Your non-delinquent children have not used police or juvenile court services, social workers or probation officers.    The healthy diet of home cooked meals, regular sleep and outdoor exercise have kept medical costs to a minimum.   And now your offspring are securely ensconced in the tax paying middle class.

Our society needs these types of people, at least the way it is set up at present.    Are their numbers increasing?   Should this be considered a charitable contribution to the country/world that dwarfs the need for any other?