Reflections on 2012

Happy 2013!

If my Facebook feed is any indication, it seems like 2012 was a polarizing time.  Some folks had a great year while others are sighing in relief that the last twelve months are over.  It seems like no matter what, everyone experienced a lot of change.

For me, 2012 was a trying year, one that threw many challenges my way.  I'd like to say that I handled them all with grace and came out relatively unscathed, but that's not true.  2012 was the year of never-ending frustrations and it wore me down. 

Right before last Christmas, I found out I had a Vitamin D deficiency and learned my body could no longer tolerate birth control pills.  I then rang in the New Year with a trip to the ER.  Early in spring, Mike deployed overseas and both of us went through one of the hardest deployments in our relationship.  The last few months have brought a complete diet switch for me, a terse and negative election season, a friendship that painfully deteriorated out of the blue, and a very full schedule between work and teaching. 

Over our Christmas vacation to Jamaica (details forthcoming!), I had time to ponder this past year and what lies ahead.  It's been a thought at the back of my head for some time, but I've realized that I'm not satisfied with some key aspects of my life, mainly in the area of work-life balance.  With my tolerance for stress and frustration waning, 2013 needs to be different.

I'm still working out the details.  I have some self-reflection ahead to make vague feelings into coherent thoughts and then turn those into actionable plans.

I don't have concrete New Year's resolutions but vague goals.  I want to:

Be physically healthier
Have more satisfaction at work
Continue with financial watchfulness
Make rest-and-relaxation a habit

What are you hoping for in 2013?      

The Dream of Owning a Home

It's no wonder that home ownership can become a burden in the US: stagant salaries, the burst of the housing market, foreclosures, changes in loan approval, rising energy prices, the value of mobility.

Despite the turmoil of said markets, Mike and I still want a house one day.  I've never thought of renting as "throwing money away," especially now that we have a wonderful place to rent with no headaches.  However, a home provides a certain level of permanency that a rental contract does not. 
I'm not here today to talk about the intracacies of buying a house, something we condo-dwelling leasees have no experience in.

Instead, I want to talk about whether the benefits of a home outweigh the disadvantages.

When I look at our finances, I see no room for saving for a down payment.  We're still struggling to clear off some older debts and not use our credit cards for gas and groceries each month.  At this point, the discussion of a home is more of a philosophical one, even though it's on our minds as we think about the future.

But I increasingly wonder whether owning a home is really worth it.  

We have friends whose children are our age and have happily rented their whole lives.  People abroad live like this. Virtually everyone our age rents. Turn back the clock some and you'll find it was trendy to live out of a hotel.  

On the other hand, we know people who feel saddled by their homes.  Empty nests once perfect for multiple children now too large to take care of, mortgages out of control, property taxes doubled, great houses untouched on a dismal market. 

When I look at the advantages of owning our own place, I see:

• A place that isn't subject to the rules of a lease, such as the number of nail holes put into the wall or how many pets we can have.
• Having a space that can be modified if we wish - walls taken out, upgraded appliances, colorful paint, different or no carpet.
• The advantages of better controlling our energy consumption, such as programmable thermostats, dimmable light switches, and maybe renewable energy.
• The potential for more square footage and storage space.
• The ability to pay a mortgage that's lower than our currently monthly rent.

However, I see some drawbacks that make me wonder:

• A house means lost mobility - you can't just pick up and move anymore.  In this economy, being mobile is a huge boom and I'm not sure if I'm ready to lose that.
• Maintenance costs are higher - no landlord to take care of it.  
• Same with updates, both cosmetic and structural.  A roof replacement, for example, will easily set you back thousands of dollars
• You have property taxes to deal with.
• You're investing in something that you may not see a return on.
• Rent doesn't have interest - mortgages do.

Right now, it's hard for me to look at these lists and think that owning a home is worth it.  Maybe it would be more attractive if we were in a better financial situation.  All I know is that owning a home is a major expense - one that should never been taken lightly.  We could never swing it as is.   

Perhaps it wouldn't be such a bad thing to rent into our late 30s - the time frame I imagine it will take for us to stabilize our income and save for a down payment.

What are your thoughts on home ownerships -- thumbs up or thumbs down?  What are your housing plans for the future?

Planning for Deployments

Did you know only 1% of the country serves in the military?  Statistically speaking, you're more likely to know someone who's black, Mexican, or gay than someone in uniform. 

I spent this past weekend in family readiness briefings.  Yes, that means Mike is deploying.  To keep national security in check, I cannot say when or where.  Let's just "far away" and "soon."

Preparing for the financial end of a deployment involves rather long checklists.  I feel lucky that I'm already in charge of our finances and bill paying, so in that regard, it's a smooth transition.

However, many items have to be arranged ahead of time so there's aren't hiccups while he's gone for the majority of the year. Some of these are easy and I can do by myself, others we need to do together:

• Reduced car insurance by moving one car to a "storage" rate
• Suspend Mike's cell phone line
• Obtain Power of Attorney (PoA)
• Renew lease prior to deployment
• Figure out taxes, will likely get extension
• Develop a plan for the extra income
• Get passwords for any financial accounts of Mike's I'm not on so I can pay bills

I find that many people are surprised by what a deployment involves on the home side.  You have to remember that one person is left behind to deal with it all. Couples have to have a lot of trust in the remaining one to manage everything, but good planning will take care of most of that. 

This certainly isn't our first rodeo and I've got few worries about what lies ahead.  As a spouse with no children, a busy career, and family in state, I have little to take care of but myself and the cats.

In many ways though, after attending the briefings and having a concrete to-do list in hand, this deployment is starting to feel more real. 

The Difference Between Planning and Banking

First off, thanks to all who gave feedback about the nature of the blog.  It really helps me to know that the readers I have enjoy what I create.  Hopefully when my work schedule isn't so demanding and this term of teaching is over, I will be back with renewed energy and increased posting frequency!  xoxoxoxx to all

After several weeks of adjusting to some recent news, I can now admit that Mike and I had been pursuing some job opportunities in another part of the state.  There was an opportunity for Mike that we learned about this summer, and we've been sitting on this knowledge for several months between the job actually opening, the application process, and the interview.

Long, disappointing story short, the job was given to someone else.  I had even applied to a position and it also didn't go through.

One of the chief disappointments with the outcome was either of these jobs would have been a financial golden ticket for us.  Salaries twice as high as they are now, job security, steady opportunities for pay raises and advancement. 

However, Mike and I set us up for even greater disappointment.  You see kids, there's a world of difference between planning for and banking on something.

Banking is much like gambling - it's risky, there are no guarantees, and the house usually wins.

Planning is a responsible approach - you mitigate future risk by your actions today. 

When it comes to finances, you should be planning as much as possible.  Planning applies to your savings account, 401k and other retirement investments, medical expenses, and vacations.

Banking, however, is disastrous.  Banking is making financial decisions today based on something that has a high probability of not happening.  Banking is what Clark Griswold does in Christmas Vacation: he puts a downpayment on a pool because he's banking on a large Christmas bonus that never materializes.

Mike and I knew we were edging past planning and into banking during these last months of uncertainty.  There were so many factors in the air that we began to lose sight a little.  We were dealing with the possibility of a complicated move, where one of us had to stay in order to fulfill some obligations.  That meant apartment shopping and two rents to consider.  There's a deployment in 2012 that was an unaccounted factor.  I'm still knee-deep in medical testing that hasn't yielded any answers yet.

We did two things that we regret.  First, we took Mike's classes down from full to part time, anticipating he might have to pick up on short notice and go.  This cut his GI in half, removing $700 of our income each month.

This resulted in us backing off of reducing our debt aggressively.  We were back to treading water, not moving forward.  This was due to both the lessened income, but also a growing mindset that our income problems could soon disappear altogether. 

This is precisely the problem with banking.  And I would recommend you avoid it all at costs because you could be making decisions that end up hurting you.

We came out of this with little more than a scrape, honestly.  And with a good lesson learned to boot.  In fact, we took what we had been hoarding in our savings account and eliminated 2 credits cards to make up for lost time.  So not a major foul.

The situation also caused us to look more deeply at our finances.  We know that my salary will be fairly static.  I make just over $26k and that's not likely to change in the next year.  We also know that Mike's GI Bill won't change provided he's taking 2 classes every term.  Since he won't be done with school until 2014 (the deployment will push things back a bit), we can reasonably say we'll be pulling in $46,000 annually for some time. 

This leads us to several conclusions.  We need to continue being creative with our money to get rid of debt.  We also have to find some way of funding a savings account with what is already coming in.

It's also made us consider if Cedar Rapids may not be the place for us to settle.  We moved to the area with the intention that we'd be here for 2-5 years, gain some financial security, and then go to the next spot.  Clearly we were ready to move with these job prospects.

However, the only problem we've had here is getting Mike a job.  That's it.  We like the distance from family (2 hrs is a nice buffer) and we're clearly in love with Dubuque.  We can drive 5 hours and hit Chicago, the Twin Cities, St. Louis, or Kansas City.  The bike trails and parks are excellent.  There are cultural options each week and we've yet to explore Iowa City 20 minutes away.

So who knows.  Once upon a time, it was common to have a 5-year plan.  You could reasonably set goals based on this time frame.  No longer, my friends, no longer.

Mike and I have limited our planning to 2012 and 2014 respectively.  Next year will be an unusual one for us.  With Mike deployed, he'll earn in 6 months what I do in a year.  That clearly is a financial windfall and you'd better believe we have some distinct plans for the income.  We are going to capitalize on this with every ounce of energy we've got.  

Next year will also mark my 2-year anniversary with the magazine.  Should I get a pay raise, it might help me establish what I can expect for salary increases in the years to come.

2014 is when Mike gets done with school and will be on the market again.  If he were to find a job, and one that he liked, it would be mighty hard to leave the area and terribly easy to talk about buying a home.  

Now, we aren't banking on that.  Who know what the economy will do in the next three years.  There's a very real chance that Mike will finish with classes, look for jobs, and be without any income at all for an extended period of time.  You can bet I'm planning for that now when I think about our savings account.

So the lesson of the story here?  Recognize the difference between if and when with your finances.  If could leave you down a path of regret. 

How a Government Shutdown Affects Us

Hopefully as you know, our government is headed for a shutdown.  This is the result of several budget impasses, some of which started last year.

(Source)

I’m not going to get political here much except to say we’re registered Independents for a reason.  Neither party represents their constituents, and traits like cooperation, reasoning, compromise, and respect flew the coop a long time ago.

Some individuals have been calling for a government shutdown.  They think this will prove some point about how little we actually need government services.

 (Source)

Here’s the thing though. Take away all of the finger pointing, blaming, toxic rhetoric, and party alliances. 

This ideological battle hurts real people. 

Let me tell you how this hurts us personally.

·       We are a military family.  60% of our monthly income comes from the government.  This will simply cease to come in.  No GI Bill, no drill pay. That’s over $2,000 that will be eliminated from our budget.  How well do you think you could cope if, on short notice, that amount of money disappeared from your budget? 

·       Not only does pay stop, but military employment stops.  Should this thing drag into next month, Mike will have no drill.  This means no employment, no pay.  That’s $350 that won’t be earned, can’t be recovered.

·       The VA system of hospitals and clients is federally funded.  Mike receives monthly services through them.  These too will be put on hold.  No medical care, no appointments, no prescriptions.

This whole thing puts our ability to pay rent and bills, purchase groceries, or get gas in jeopardy.  I’m not exaggerating or being alarmist.  We don’t have $2,000 in a savings account to patch us through.  We don’t even have $200. 

The funny thing is, we don’t even have it that bad.  We have friends who are deployed right now, work full time on active duty, or need intensive medical care. 

Military families, not to mentioned thousands of federal workers, depend on their government income.  Just like you depend on your employer’s salary.  It’s no different, except I doubt very much your business is going to go belly-up and suddenly not pay you.

It’s supremely stressful right now, knowing that we could be in real financial trouble through no fault of our own.  How do you approach a landlord, for example, and explain you can’t pay rent because the government didn’t pay you?  I can’t imagine them being very sympathetic.  

The budget has to be decided by midnight tonight or it will close its doors.  I am very thankfully that Mike’s GI payment came in yesterday.  So we are mostly covered this month. 

When he receives his drill pay is another question.  If his GI Bill comes in next month is also up in the air.  Who knows if he’ll have drill next month.  

We’re not magicians.  We can’t make money appear out of thin air.

(Source)

I’m hoping our representatives can come to an arrangement tonight.  I really do.  I just wanted to share, in a concrete way, how political actions have real consequences.  

Life is Not Like Chess

“Indecision is like a stepchild — if he does not wash his hands, he is called dirty, if he does, he is wasting water.” (African proverb, randomly found on the Internet)

Indecision and I are become quite intimate.  We just received news that once again, a really good job for Mike has eluded us.  Back at Square One, which oddly looks like a trendy café name or union station.  Alas, it’s the Capital of Indecision, a country with a certain penchant for elusiveness.

Mike’s options are clear at this point: remaining in school and continuing applying for jobs.  Avoid going stir crazy at home every day.

My path is not so clear.

We are going on 10 months in Cedar Rapids.  It’s clear that while my salary can “support” us, in the sense that bills are paid and we have food, we are nonetheless in a precarious position.  Our single-income state generates the following problems:

·         Prone to using credit cards as supplement income for basics

·         Inability to have a savings account

·         Eliminates even thinking about retirement planning

·         Complicates reducing our debt

·         Doesn’t provide room for little luxuries, like simple day trips or visiting family

If it weren’t for Mike’s GI Bill payments, we’d continue to have some serious financial problems.  While the money is being used wisely, it’s also not enough to address any of the above (except for credit cards).  It’s just keeping us floating a little more comfortably while we tread water.

As of late, I’ve been questioning how fiscally responsible it is to continue in my job.  I have the potential to earn more than I do now.  But is it worth the risk?  My mind has been sifting through scenarios as of late and none of them have really solidified what the next step is.  So here are some of my thoughts piecemealed together to form some semblance of coherence:

·        I should get my application in again to the Upper Iowa center in town.  It looks like the Waterloo commuting opportunity has dried up.  If I get my application in again, perhaps go in person, I might be able to land a few adjunct classes.  This would allow me to stay in my current job and earn a little on the side again.  This is the lowest risk option, but if played right, could lead to a full-time job.  What would happen if instead of an adjunct spot, they offered me a salaried position?  What if they only wanted me to adjunct for composition classes?

·        The whole teaching thing leads me to think of the bigger picture: whether I want to keep myself available for higher education and keep my teaching experience active.  For example, I passed by applying to a full-time teaching post at the local community college because the load was high (5-5), 80% would be composition classes, and no salary was listed. How badly do I want to work in higher education?

·        There are other jobs in the area I could apply to related to my degree.  ACT and Pearson both have positions available with $35-40k salaries.  But is it worth selling out my educational values (not contributing to standardized tests) to provide for my family better yet possibly get into a job which I may not like at all?

·        Leaving my job as of current could actually be detrimental for my future prospects.  Nationally, most editing jobs are looking for 3 years of field experience.  I have 10 months. Is a higher salary at another job worth having only one year as an editor on my resume?    

·        In lieu of my one year with the company, a raise would be appropriate since I have the same workload as my colleagues yet a lower title (read lower salary; I don’t give a hoot about status).  However, even if I did get a small raise, which is unlikely, that still doesn’t provide us with much more wiggle room. It would also be the top of the ladder since there aren’t any other positions to be promoted to. This means that ultimately, the job can’t keep me for the long haul. Doesn’t that mean I should just stick it out until Mike finishes school and we can be free of Iowa then, calling these the Lost Financial Years?

All of these lead me to one big question: what do I want to do with myself?

I have specialized degrees and qualifications.  I also have standards about how I want to live my life.  Neither of these are contributing to a 401K. 

So what’s a gal to do?  Sell out to live more comfortably and secure a better financial future, or stick with it and try to make it work?  Hope that Mike gets a great job after graduation and that I find a higher salary?  Who’s to say in this economy that this simple expectation will ever be a reality?  What if this is as good as it gets?

I just had a dear friend land her first job in her chosen field (gerontology, the elderly).  While she had to take a little pay cut, she will never be out of a job.  From this moment on, she will only become more marketable in her profession.  This is super exciting.

I, on the other hand, have my feet in two fields that are going through massive upheaving: publishing and education.  A future in either is quite a hazy prospect.  Given the way higher education is going, I’m deadly realistic about my chances of landing a full-time spot.  Having been in publishing for year, I’m not sure about how well I’d like my future days doing exclusively this.  I’m not sure if I have the gumption to stay innovative as the field digitally redefines itself, though writing for a food magazine would be heavenly.

My path used to be tidy and neat.  Go to grad school, go to PhD school, get a job, get tenure.  There were hundreds of predetermined checkpoints to meet, a clear ladder to get from Point A to Point B.  You knew what was expected and what could be a misstep.

Now I think my greatest problem is that I feel everything could be a misstep.  I’m not comfortable with this.  I loved playing chess.  It was a great game because you only had so many moves you could make, only so many moves your opponent could make.

Life is not like chess.  There are no more black and white squares to preplan for.  I know this is what life is about: the grand adventure into the unknown, your future is what you make of it, yada yada.  But financially, your future is defined by your ability to plan.  How’s that for being at odds?      

I had intended to make this blog post short.  In fact, it’s the same length as one of my unwritten features, which are due on Friday.  Either way, it was good to put these thoughts in writing.  It’s trite to say there aren’t any easy answers and I know and accept this.  It’s more difficult to admit that you want to do your best but don’t know how.