Money To Live

April 29, 2009

Moving to Austin, TX

Filed under: Uncategorized — by moneytolive @ 5:00 am

I am moving back to Austin, TX, where I lived from 2000-2003 while studying at the University of Texas.

Reason #1 to move to Austin: Friends

A few days after being laid off, I had this conversation with my mom:

Mom: Why don’t you just move to Austin because C? [my college roommate and best friend lives in Austin]
Me: Hmmm … maybe.

A few hours after that conversation, I talked to C:

Me: My mom suggested that I move to Austin. What do you think?
C: Of course you should!
Me: Okay. : )

Reason #2 to move to Austin: Cost of living

Though at that point I had not done the research, I knew that Austin was a cheaper city to live in than the suburbs of DC. Taking into account cost of living adjustments, I can take a 30.5% pay cut and maintain my same lifestyle in Austin. Here is the break down of expenses:

  • Groceries will cost 14% less.
  • Housing will cost 61% less.
  • Utilities will cost 7% less.
  • Transportation will cost 8% less.
  • Healthcare will cost 9% less.

Reason #3 to move to Austin: Lots of jobs

College towns fare better in this economic downturn.

April 22, 2009

Tapping my emergency fund

Filed under: Uncategorized — by moneytolive @ 5:00 am

A popular (and controversial) topic in personal finance is the “emergency fund.” The standard advice for an emergency fund is to have 3-12 months living expenses in cash.

When I was laid off I had a little over $12,000 in cash savings. Half of this was intended as an “emergency fund,” and half of this was the beginnings of a “down payment fund.” Since home ownership is off the horizon for now, I lumped all of the money together and will leave it that way until I feel financially settled again. In Virginia, my minimum monthly expenses were around $2,000. Not counting unemployment and severance, I could survive for about 6 months.

An unexpected expense

I was pretty shocked when I realized I had never considered one aspect of my emergency fund: would I have enough money to move?

Soon after being laid off, I realized I did not want to stay in Virginia, and it would be quite expensive to leave.

The cost of moving would be more than $7,000, deeply cutting into my cash savings. To move out of my apartment, I would owe 4 months rent: 60 days notice of intent to vacate and 2 months penalty. With monthly rent at $1,610, it would cost over $6,000 simply to leave my apartment. Also, to move even some of my belongings halfway across the country would cost a minimum of $1,000.

I had not thought about moving costs, and a lot of other people are in this situation as well. Consider Detroit. Not only are people losing their auto industry jobs, but since the industry is dying and people are leaving, home prices are plummeting. To leave, a family needs enough money to pay for moving expenses and make a down payment on a new home (or deposit on an apartment). They may be unable to sell their Detroit home for a profit and may have to keep making mortgage payments on an empty house, rent out the house (possibly at a loss), or face foreclosure.

Fortunately, I was able to negotiate what I had to pay to break the lease. Instead of $6K, I ended up having to pay only about a third of that.

Dipping into savings

With the help of severance pay and unemployment benefits, I have not had to tap my cash savings yet. I hope to keep it that way, except for two, big upcoming expenses:

  • attend a residential yoga teacher training program (about $5,500)
  • pay the deposit of my next apartment

Since I do not have a job lined up, I am taking three weeks off from the job search to obtain a yoga teaching certification. Today my mom and I started a road trip to the Colorado Rockies, where I will be for the next three weeks.

April 15, 2009

What not to say to someone after a lay off

Filed under: Uncategorized — by moneytolive @ 5:00 am

What not to say to someone after a lay off

  • What are you going to do next?
  • Are you moving back to Texas?
  • Are you moving back in with your parents?
  • [While she is cleaning out her desk] So, who gets your desk?
  • Were you actually fired and you are just pretending it is a lay off?

As a rule of thumb, only make the comment if you could replace “lay off” with “divorce.”

For example, 48 hours after a couple announced their decision to divorce, would you say “Now that you are single, are you going to move back in with your parents?” to a colleague you have never socialized with?

I am still surprised by the question about if I were actually fired; the person went so far as to ask if I were fired for unprofessional conduct. If you know me at all, you know that is not very likely.

What to say to someone after a lay off

  • Here’s my card. We’re hiring.
  • Let’s go out to lunch tomorrow.
  • I would like to buy you lunch (or dinner or beer or a brownie).
  • We would love for you to visit us!
  • Here are some flowers for you!

Depending on who you are and who you say it to, this might be a good thing to say

  • It’s a blessing – in 10 years, you will be glad it happened.

Most of the people who I practice yoga with said this to me, and I know what they mean and where they are coming from. They said it genuinely and with love. If you can say it genuinely, then it is okay to say it to me.

April 8, 2009

Changes in Spending Habits, Part 2

Filed under: Uncategorized — by moneytolive @ 5:00 am

Ironically, since I wrote “Changes in Spending Habits” on February 11, my spending habits have changed significantly.

The original list:

  1. I save a lot more money …
  2. I have a more expensive apartment …
  3. I pay for cabs and garage parking with much less angst …
  4. I am a member of a fancy gym …
  5. I got a cleaning lady …
  6. I spend more money on clothes …

The new list:

  1. I aim to not spend all of my savings.
  2. I am a homeless wanderer. The closest thing I have to a home is half of a closet in my parents’ guest bedroom.
  3. (No change. I still pay for cabs and parking garages with much less angst. It’s not worth the stress.)
  4. I am no longer a member of a fancy gym.
  5. I am my own cleaning lady.
  6. I spend as little as possible on clothes. Two weeks ago, my mom took pity on me and bought me some $7 camisoles from Target.
  7. I give larger tips at the coffee shop. After initially cutting back on small tips, I now give larger tips to promote my money-making karma. Even with my new circumstances, I may be better off financially than the people serving me.

Why so many changes? I was laid off on February 11.

Out of respect for my own privacy and that of my former colleagues, I am not going to write about why or how the layoff came to be. At this point, I do not need any condolences – save them for January 2010 in case I have not yet found a new job.

Over the next several weeks, I will tell you about the experience. Look for posts on these topics:

  • What not to say to someone recently laid off
  • Tapping my ’emergency fund’
  • Moving to …
  • Downsizing my life
  • The drive away from the East Coast

April 2, 2009

Guilt-free book purchases

Filed under: Uncategorized — by moneytolive @ 5:00 am

I used to feel guilty about buying books because

  1. They cost money, and I could check out a book from the library for free.
  2. Books take up a lot of space and are heavy to move.

Lately, though, I have come to terms with buying books on the Kindle because

  1. By purchasing books for the Kindle, I am supporting Amazon.com – a website that I like and that makes my life easier.
  2. The author gets a royalty from my purchase. Since I want my favorite authors to keep writing, I want them to have the luxury to write and not take a day job.
  3. Electronic books do not take up physical space.

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