Money To Live

August 26, 2009

How would you spend $20 K?

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

Over the past year, each of my parents independently received about $20,000. This money was not included in their expected income for the year; they already had enough to cover all the monthly bills. They did not discuss their plans for spending the money together, and each  decided to spend (or has already spent) the money in a very different way.

My father received the money in regular intervals throughout the year. He took the amounts in cash and spent the money on groceries, gasoline, spending money on trips, and other household items. And, admittedly, he slipped some money my way, which I spent primarily on groceries and gas.

My mother received the money in a few big chunks and is using it to completely pay off their joint mortgage.

How would you spend an extra $20 K that was not expected and was not a planned part of your budget?


August 19, 2009

The Modern Way to Float

Filed under: banks,spending,Uncategorized — by moneytolive @ 5:00 am
Tags: ,

Decades ago, it was common to float a check. For my reader(s?) born after 1990, here are two examples:

  • I go to the grocery store and write a check for $200, even though I know I only have $150 in my bank account. I expect to receive my paycheck tomorrow, so I can count on the paycheck being deposited before the grocery store cashes my check (it used to take several days to a week).
  • Watch the Leonardo DiCaprio movie, Catch Me If You Can.

With the rise of debit cards and check scanning technology, the time between writing a check and the funds being withdrawn has shrunk from a span of days and weeks to a span of seconds and minutes.

The modern way to float a check is to use a credit card.

Credit card users fall into two buckets:

  • “floaters” who use the card for its various perks (rewards, convenience, consumer protection, etc.) and pay the balance in full each month
  • – “debtors” who don’t have the money to pay the balance in full each month

When talking with “debtors,” I have sometimes had trouble explaining how I use my credit card, but now I found a good way to explain it: I use my card the same way people used to float checks. For each transaction, I used to have a grace period of 2-6 weeks to pay for the transaction. With recent legislation (sec. 163), the grace period is now 3-7 weeks!

August 12, 2009

Budgeting gone a bit too far

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

A friend was formerly affiliated with a peculiar non-profit. She organized a regular lunch series and was originally told not to worry about the budget for food – order as much as you need, and we will cover it – she was told.

After several months, she was called in and was told that the pizza budget was dwindling. Could she change her order? Well, of course. She was surprised and had no intention of burning through the allocated food budget.

Upon further discussion, though, she was told that there was plenty of money left, just not for pizza. Couldn’t she order sandwiches to use up the sandwich budget?

August 5, 2009

Alternative wedding registries

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

A dear friend got married a few weeks ago, and her “house registry” was featured on Smarty Pig:

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