Take Credit for Being Credit-Wise

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While it does interfere with the comfortable digestion of my breakfast, I usually watch the morning TV news for twenty minutes or so, just to see if anything important has happened in the world…and I have to watch carefully, as most morning TV shows just consist of cute exchanges, truncated conversations with important people, or the rehashing of stories that have minimal significance but maximum power to pull in an audience. Recently, though, I watched a story about how credit card companies are raising their interest rates to 30%, and how that might border on “usury” - which is supposed to be illegal. 

As a young adult, I didn’t even have a credit card.  I got my paycheck, put it in the bank, and used checks against what I actually had in my account in order to pay bills.  If there was anything over at the end of the month (and if there was, it was very little, as I was making only $11,000 per year as a college professor), I considered it “splurge money” and used it on something stupid.  Today, I’ve got lots of credit cards, but never pay any interest, as we pay off the bills in full the day they arrive.  Admittedly, in between being a young adult and today, there have been some stupid and/or disastrous times when the use of a credit card put us in debt, and it took effort and pain to pay it off. 

I say all this to make it clear that I’ve “been there and done that” like everyone else.  And ultimately, I think the answer is: don’t use a credit card unless you have every cent in the bank to back it up.  Don’t consider it a credit card at all - consider it a cash card.  In fact, you might consider only having a debit card, which means it can only be used in relation to what you have, and not what you wish you had.  That way, you won’t have credit charges which can rip apart the fabric of your life.

Here’s another idea:  take the time to earn what you want - that special car, a home, jewelry, a vacation - instead of having your folks give you a down payment for a house you can barely afford.  Take the time to build your foundation, and when you can finally afford the next step in your life, you’ll feel much more accomplished, proud, special, and downright happy.

How About Some “Reverse” Ageism for a Change?

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I read in my local paper about a formerly wealthy 90-year-old man who now has a job as a “greeter” in a local store.  It seems the company that managed his money was making bad use of Bernard Madoff’s Ponzi scheme and all was lost…especially since this gentleman’s once fully-paid-for home was re-mortgaged to get a third of a million dollars more to invest in this debacle.

Ironically, one of the factors which keeps people alive longer and healthier in mind, body ,and soul is having work, i.e., some purpose and activity not only to occupy their minds and time but to challenge them.

Coincidently, a dear friend of mine owns and runs a lovely hair salon.  It seems that every month she complains about the “young thing” at the front desk. It seems young women can’t be counted on to come to work regularly, much less on time and do their jobs as receptionists and appointment bookers.  Obviously,  this is not one of the highest-paid jobs in the universe, but young people today seem to feel entitled to “more” rather than grateful for “a foot in the door” and potential long-term opportunities.

Here’s where these two stories intersect: I told my friend that she should hire a retired, mature woman who would appreciate the extra money, would like contact with lots of people as colleagues and customers, and would probably love having her hair done for free.  The mature woman would appreciate the excitement and daily mission, and my friend would probably get one of the most reliable workers she’s ever envisioned.

Were I hiring right now, I’d be a reverse “ageist” and get somebody with a work history and the maturity to appreciate an opportunity where they can still be important to somebody about something and get paid for it!

Kids Don’t Have To Go To Bed Hungry

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At a recent media fundraiser, I was asked how a parent in southern California could best tell a child why he or she would have to go to bed hungry.  My answer (which was met with some silence) was that in southern California, there is absolutely no reason for any child to go to bed hungry, and that parents should do whatever it takes, legally, to make sure that didn’t happen.

That means going to your local church and other available community resources for temporary assistance, getting some part-time, even menial, work in the evening for some extra income, going to “big box” stores with friends or relatives to pool your resources and buy cheaply in bulk….I could go on and on.

I remember one point in my own family’s life when we went through every pocket of every jacket and pair of pants, every drawer, and every little “box-like” entity in the house to pool together enough money to go to McDonald’s with our son.  I remember crying in the mall one day, because we didn’t have enough cash for a second pair of shoes for him.  I remember being angry and scared, and I remember hunkering down with my husband to figure out how to solve the problem.  I’ve been there.

Dave Ramsey is in print and on just about every television program, giving good advice on what to do about your financial situation.  Check him out.

Blessings in Disguise

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I have always been impressed with the mentality of the Mormons with respect to the issue of charity.  I had a tour of their main charity facilities, and was amazed at what I saw and learned.  There are absolutely no handouts – they barter!

Here’s how it works:  if you could lose your home, or if you need food, clothing, medicine or toys for your children, the Church takes financial care of your needs.  In exchange, you provide services to the very mechanism that rescued you.  This means that folks in the bakeries are people who have benefited from the charitable services; those helping in the stores that sell thrift clothing, housewares and food are those who have benefited from the charitable services, and so on.

The basic concept is to preserve a sense of dignity and pride in those who have temporary need by giving them an opportunity to use their skills in the service of others.  Walking around the premises, I felt the uplifted attitude of all who were there:  smiles, waves, and straight backs.

The Church of Jesus Christ of Latter-Day Saints provides for people all over the world – not only with goods and goodwill, but with the opportunity to not lose a sense of self when “things” are lost. 

I probably sound like an advertisement for the Church of Jesus Christ of Latter-Day Saints.  I am not a member of their religion, but I am impressed with their charitable philosophy, because I believe it teaches our children their real value, while motivating and uplifting them at the same time.

Their young people who graduate high school are expected to go on two-year “missions,” reminiscent of the Peace Corps.  These young people come back much more mature, as they’ve experienced the pain and need of others, and have sacrificed two years of their own comfort to be of service to others.
Other youngsters just don’t want to skip a beat in their acquisition of iPods, cell phones, and other “Internet in your hand” gadgets.

I believe that the economic disaster our country is in right now is a kind of blessing in disguise with respect to values. Without values, life just provides us with “things,” but not necessarily with any profound meaning.

Economic Challenges

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I cannot even estimate how many recent callers fall into two discrete, and unfortunate, categories:  the first are largely women calling to find out how they can better deal with the bitter resentment they have toward their husbands, because of economic stress; the second are largely men calling to find out how they can better deal with the feelings of failure as a man because of economic stress.

To the women, I say “Unless he actively burned money in the basement, gambled it away, or spent way, way, way over budget, your fears are turning into rage toward the one person you should turn to, and not on.”  When they (generally) limply come back with “Yes, he spent more than we had,” and I come back with “And, didn’t you?” then the meeting is called to order.

To the men, I say, “I am heartened that you see your responsibilities so clearly, but you are letting your shock get in the way of your problem-solving skills.  You see a hungry tiger in your living room, salivating over your kids.  Shock sets in, and you can be depressed that you don’t have a stun gun or you can’t figure out another way around that tiger to save your family.  We indulge in the shock and sadness of it all, but now it’s time to see the challenge.”

I have teenagers with small incomes from part-time jobs call, wondering if they have to “share” with their parents who are up against it.  Can you imagine that?  Instead of being rather excited about the ability to contribute to the family at a time of crisis, many of our teens are only looking out for “Number One.”

All cities are having charity drives not only for the holiday season, but for victims of fires and personnel layoffs due to incompetency in government and private industry.  Most of the time, this issue is food, but sometimes children’s lists include iPods and laptops!  Can you believe that?  What have we taught our children about humble survival and retrenching when they are still focused on high-priced electronics?

Day Care Bites the Dust

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I know I have made myself quite a controversial subject by my insistence that children be loved, cared for and raised by their mommies and daddies instead of hired help and institutionalized child care. As I have said many times, children evolve each and every day…and those minutes need to be influenced by and experienced with the people who matter the most. This is why I am thrilled about the one-sided effect of the current economic problems in America.

According to a recent report in USA Today, parents nationwide are telling day care providers that “they must scale back or abandon their services. Instead, they keep kids at home with grandparents or up-end their work-life balance because gas and food prices have become prohibitive and average child care costs outpace rent and mortgage payments - even for those drawing salaries.”

Of course, the day care industry is scurrying around trying to come up with a plan to save itself. Many are offering all kinds of hours and financial deals. The USA Today article, after noting that the 2005 U.S. Census Bureau data (the most recent available) indicated that 2.65 million preschoolers attended day care, and that current statistics of un-enrollment were not available, called the situation “distressing.”

Sure it’s distressing for an industry that has been so effective in its marketing, that parents who actually raise their own children are made to feel guilty for doing so. But it is not distressing for the children, who will now be in the arms of people who love them and are there to teach, nurture, support, and experience life with them.

Sure it’s distressing for parents who have to reconsider and reconfigure their lives to accommodate raising their children. But, they will find surprising rewards in the true experience of family.

The hysteria from the child care industry has included dire warnings that parents will leave their kids home alone, in cars, or with strangers who might hurt them. That sort of child neglect and endangerment goes on in spite of filled-up day care establishments and should be dealt with through social services (to help families make better adjustments in their priorities) or through the legal system (where children are removed to live with safer relatives or foster care).

If it is true that every cloud has a silver lining, then the “shine” is there for many children of parents who can no longer pay the $3,000 to over $10,000 a year for day care, because mommy or daddy is coming home to you.

Is Personal Responsibility Passe?

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When marriages get difficult, people “bail out” by divorcing, and flippantly propose that the kids will be fine.  When school children are failing classes, the tendency in American education is to drop standards on performance examinations, drop the tests altogether, or punish the hard-working children by eliminating valedictorian status.  When folks decide that their business or financial situation isn’t paying off, they declare bankruptcy and ultimately give the bird to those who trusted them enough to do business with them.  When the auto industry makes cars that aren’t popular, Congress votes to bail them out financially.  When mortgage companies and banks loan trillions of dollars to people who can’t possibly pay their monthly bills, we have a world-wide financial crisis requiring the average, hard-working citizen to give up his or her compensation to save the day.  When people do stupid things, like put hot coffee between their legs while driving a car, a company has to pay out from its profits to compensate for a customer’s irresponsibility.

This is not really about finances.  As many have pointed out, during the Great Depression, unemployment was higher than 20%, and people found themselves unable to pay their bills through no fault of their own.  This is 2008, and unemployment is about 5%, and people find themselves unable to pay their bills totally by their own fault!  Why?  Because they want to live a lifestyle they have not yet earned.

This is about character and honor as well as the philosophy of earning your blessings.  I have told many a parent not to buy a home for their newlywed children, because they would be robbing them of something to work towards together, in addition to the thrill of the accomplishment.

Dozens of CEOs are walking away from disasters they helped create with hundreds of millions of dollars of “reward.”  Millions of Americans are walking away from the disasters they greedily and irresponsibly signed up for by putting their names to a promise they could not keep.

This is not the American spirit of old, and it’s certainly not the way to bring up our young people.  I hope they have learned from this.   Instead, I worry they’re just blaming the Wall Street fat cats or the Federal government.  To quote Shakespeare:  “the fault lies not in our stars…but in ourselves.”

Do Financial Crises Cause Marital Crises?

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The world’s finances are being shaken to their core because of - well - cheating and greed.  Nonetheless, people are being laid off, large companies are going out of business, small businesses can hardly pay for even minor fees to keep themselves afloat, and the price of gas keeps yo-yoing.  The good news is that you can buy a car for under sticker price…as long as you don’t need a loan; you can also buy a house for a pittance…as long as you don’t need a loan.

A number of financial advisors have reported that their biggest problem is not the most obvious one, which is explaining what folks should and shouldn’t do with their cash, savings, and investments.  As it turns out, their biggest problem is how husbands and wives are turning on each other with blame and rage or turning away from each other with blame and fear.

Feelings of concern, anxiety, sadness, confusion and fear are, frankly, reasonable emotions when tornados, hurricanes, and earthquakes hit your community…it is reasonable to slap your own - and maybe each other’s - foreheads, regretful that you both didn’t plan better.  But ultimately, it happened to each of you and all of your neighbors and you have to respond in a constructive way despite your personal pain.

Feelings of concern, anxiety, sadness, confusion and fear are, frankly, reasonable responses when the financial bottom falls out from under you.  It’s not unusual to want to look for the cause of the disaster whether it is a bank CEO, the President, the Treasurer, modest-income people who borrowed to live beyond their means….or….your spouse.

“Kicking the dog” because you are upset with your day is animal cruelty.  Kicking your husband or wife when you are both in the same lifeboat is also cruel, and it is destructive to the marriage and the family.

Perhaps it is true that one or both of you made some financially unwise moves with investments or by spending too much and living beyond your means with credit cards and loans.  I think that in these situations it is always best for the person in charge of the “errors” to simply own up to screwing up, apologize, and then offer to help make things right.  Once your spouse has thrown himself or herself on your mercy, do not ever make them feel stupid or bad in an attempt to regain a sense of superiority or control. 

When things go wrong, turn TO each other with compassion, solace, and a pledge to be a team and work it through together, survive it together, brainstorm together, and work together.  No matter how sad you feel, this is the time for lots of attention and great sex.  Endorphins and orgasms go a long way to keeping you both cheerful about life and life with each other.

The financial situation in America and the world, as well as the Dow, will come back up.  Make sure your marriage weathers the storm so that you can both be there to enjoy it.