Why do student loans suck so much?

We’ve been over this before.  My hatred of student loans and debt in general is well known.  But now I feel I have some new reasons to despise them.  I’ve been working with some people lately on building their credit and during this time I’ve found out that student loans like to screw with us in ways that, quite honestly, don’t even make sense under normal circumstances.  Of course, in the insane world of banking they make perfect sense but that’s a story for another day.

Look at this accident I got into while contemplating my student loans.  Truly horrific stuff.

Look at this accident I got into while contemplating my student loans. Truly horrific stuff.

You see, when you’re going through your few years at school, whether it is undergrad or graduate, and you have student loans paying for everything, you’re hurting your credit score.  Most people will tell you that by taking on term debt, which is what a student loan is, that you’re going to help add credibility to your name in the eyes of the banks.  While this may be true traditionally, it fails to take into account the years you spent in school, not paying that term debt down.  Even though you’re in school and either no payments or just some interest payments are required, you’re dinging your credit score.

What?  No one has mentioned this to you?  Yeah, I didn’t know either.  What happens is that because your term debt goes years without declining, the algorithms at Experian and TransUnion (and that other one whose name I can’t remember) look at it as though you are a bad payer.  It doesn’t matter that no payment is required, just that the balance is either not changing or going up (if the interest accrues while you’re in school).  While I completely get it…wait  no I don’t.  Nothing is due!  Gah.

Ok ok, this is fine though.  Sure your credit score went down but you saved up a lot of money in your first job post school and you have decided to be super responsible and pay off your student loans early.  Sure you lose the tax deduction but who cares!  No debt!

The banks care, that’s who.  And because you paid the student loans off early and they didn’t receive their interest, you’re going to get your credit score dinged.  Insanity.  Despite the fact that you just paid off your debts and have proven yourself to be a good risk for the banks in terms of them receiving their principal, you have made yourself a risk to them.  A risk that they will not receive their profits off of the interest.  Once again, insanity.

Normally, I don’t rant like this.  I get the system has quirks and I accept that.  However, coming across these to items while trying to help people improve their credit makes me furious.  There’s just no reason for this to hurt you at all, especially when a student loan is considered “good debt.”  What this does whole experience has told me is that people need to keep track of their credit!  There are two websites that can help you do this.  The first is www.creditkarma.com.  This site is run by TransUnion and gives you your score and a quick rundown of your report.  It’s a good free way to make sure you don’t have any derogatory marks on your credit.  The other site is the government’s annual credit report website.  Government regulations require the three credit bureau’s to give you free credit reports once a year.  These reports will be thorough and will tell you everything about your credit, including the names and numbers of the firms that gave your derogatory marks.  These two websites can help you sort everything out.  Often, you will only need to make a few calls to remove derogatory marks from your record.  Not the student loans, just people saying you didn’t pay on time.

Hopefully this post makes people think twice before adding another $5K or $10K in student loans when they may not need them.  Looking back, I wish I had done more to prevent getting my student loans.  Until next time folks!

 

Photo courtesy of Rool Paap

What does affordable actually mean?

Affordable is a tricky word.  If you look at it simply enough, when an item is affordable then you can spare the money to buy it.  But I’ve been thinking a lot about this lately.  I’ve had discussions with various friends about this, largely stemming over the potential large purchases in life (cars, houses, engagement rings) or the month to month costs that we regularly incur (iPhones, iPhones, iPhones).  What I’ve realized is that most people have very different beliefs over what affordable means and when certain things are affordable.  So everyone is on the same page, I think we have to define the term for pretty much all purposes going forward.

So many iPhones, it's just...wait what the hell is that big thing??

So many iPhones, it’s just…wait what the hell is that big thing??

Defining what is affordable and what is not has to be a fluid state.  What’s affordable for someone making $20k a year will probably be significantly different than for someone that is making $100K a year.  That can get even more skewed if the person making $20k a year is actually just collecting that in dividends from their $1Million in mutual funds.  So let’s just try to set some base rules.  We’re talking major purchases and everyday recurring transactions.

1.  Homes: The rule of thumb that you will hear from bankers and mortgage brokers is that your monthly home payment shouldn’t be more than 30% of your gross income(income before taxes) for that month.  There is actually a decent amount of debate here in the personal finance community, mostly because frugality is constantly desired.  A modest home can achieve just as much love and happiness as an expensive home can, while saving you a huge chunk of cash.  Let’s look at the numbers here if you’re on a budget with a $50k a year gross income.  That means your take home gross is $4,166.67 a month, before taxes.  This means that your home payment can be as high as $1,250 a month.  That doesn’t sound bad until you realize that your take home, after tax income is only about $1,450 each pay period (semi-monthly pay).  So on the first of every month you pay your mortgage and than have only $200 until your next paycheck to cover your expenses.  In the interest of keeping our budgets in check and maximizing savings, I think that 20% is probably the actual best number for someone to pay for their home.  Realistically, this should be for both a rental and for a home (yes, I know that with property tax deduction you can do more for a mortgage but hey, we’re trying to simplify!).  Verdict: no more than 20% of gross income

2.  Cars: This is a simple one.  We’ve mentioned it in the past and I’ve stolen it straight from the Financial Samurai himself.  Never purchase a car that costs more than 10% of your gross annual income.  If you make $50K a year, then you better find a good and reliable $5K car to purchase.  I know that I’m guilty of not following this rule myself but, in my defense, I hadn’t started trying to turn my financial world around at that point.  And I wouldn’t do it again.  The truth here is that by using a disciplined approach on this big purchase, you don’t have to suffer the opportunity cost of money lost on car payments when they could have been spent on investments.  If you’re serious about getting your finances in shape, it’s essential to follow this rule.  Verdict: no more than 10% of gross income

3.  Cell Phones: Everyone has one.  Everyone.  And pretty much everyone out there has an iPhone or an amazing Android.  However, the plans from the big providers can cost you well over $100.  I don’t pay for my plan (company phone) but I know that the cost is somewhere around $125 a month.  Now, it’s ok for my company to expense it but for me, that’s a steep price to pay.  There are other, better plans, from some carriers out there that will run you less than $50 a month.  T-Mobile offers some extremely competitive plans in this area with unlimited data.  Another great plan is Republic Wireless.  On their network you pay $19 a month, get a pretty good phone and end up with unlimited talking, data, and texting.  You have to hook it up to your wifi network at home but I’d say it’s worth the cost.  If I didn’t have a work phone, I’d probably go with this.  Verdict: No need to ever spend more than $50 here

4.  Discretionary items:  A lot of every day items tend to be things that people think they can afford.  I’m talking about clothing, a night out, or an expensive dinner.  While I don’t think we should restrict ourselves completely (it’s ok to buy yourself something nice every once in a while), we all have to stick to our budgets and live within our means.  If someone has a goal of saving 30% of their salary a month and has 30% tied up in their car and home payments, well, they only have 40% left to split up amongst utilities, gas, groceries, and taxes.  Those items can take up to 30% of one’s income.  That means that only 10% is left for the fun discretionary things.  If you make 50K a year, you’re not going to have much more than that 10% to really spend on the extravagant things in life.  Verdict: 10% of your income is discretionary, no more!

I know that some of these items seem fairly harsh but we all know that we spend too much money. Without sitting down and really quantifying what affordable truly means in dollars, we will never really know.  Use these amounts as guidelines or maybe you have some of your own.  I’m sure that there might be a category or two out there that I’ve missed!

 

Picture courtesy of Nobuyuki Hayashi

Working from home

With my new job, I have a new office.  It’s a tiny corner of the apartment with a decent view of the outside.  I have a nice desk, a printer, and a pretty great monitor setup.  You see, for my new job I’m working remotely.  I’ve mentioned it before but now that I’ve been doing it for more than a month, I have a much better idea about what it truly entails.  And while I definitely am loving the flexibility with regards to my sleep schedule, it’s definitely lacking something that you just get when you work in the office.  There are, specifically, four things that people have warned me about:

1. Decreased productivity

2. Loss of creativity

3. Complete loss of interpersonal skills

4. A slow, creeping madness

When we get right down to it, there is some truth to this.  With regards to number 1, I’m actually absurdly productive, it’s just different.  For example, working at home has led to me doing a tremendous amount of work over a 2 hour period followed by a relaxing 20 minutes of watching, say, Community.  Then I’m right back to work, pushing paper and making finance stuff make sense!  The problem here is that sometimes, if you don’t feel like working, you have to move mountains to get your normal workload done.  Seriously, mountains.

For number 2, a loss of creativity, I’m not exactly having a problem there.  For starters, I was never that creative to begin with.  Can’t lose it if you don’t got it.  But still, the threat is there.  Luckily I have a couple of interesting projects going on that require me to use what little creativity I have.  Like this site or my wedding.  Between those two and a couple of other items, I’m not at a loss for creative outlets.  But what I can see happening is number 3, losing the ability to actually communicate with people.

Losing my ability to talk to people, reason with them, etc, is a HUGE fear I have with regards to working from home.  See, one part of my job that most people don’t realize is that I spend large portions of my day on the phone working out deals.  So I have to interact with people every day.  My job literally depends on it.  So the only way I’m able to keep that ability is to start getting out there and meeting and interacting with more people.  So, I joined a kickball team (Saved by the balls) and am making a point to go out more often.  Now, I’m not spending a lot of money when I go out but it’s definitely been a lot of fun and has kept me reasonably sharp for work.

Now, number four isn’t a real fear for me.  I have an amazing fiance here to keep me from really losing my mind.  But if I do, you, the reader, will likely be the first to really notice.  So, uh, yeah keep an eye out for that.  Thanks!

When it comes down to it, working from home has been great.  I don’t have to commute, I can sleep in if I want and I am eating WAY healthier.  It also gives me a bit more time to work on the site, which I love.  I think it’s one thing that everyone needs to try at least once in their careers.  It’s giving me the possibility to move to a less expensive city and potentially own a house!  It opens up possibilities that being locked to a desk just doesn’t quite allow.  Until next time folks.

Everything is going to be just fine

Turns out that 2013 is the first year since 2005 that the percentage of 18-34 year olds living at home has declined.  This actually is GREAT news when you think about it.  When you look at the chart, you see that the percentage of that age group starts growing in 2005, several years before the recession actually began.  2005 is the year that homes started getting too expensive for people in that age group, creating the logical conclusion for those folks to move back home in order to save up for a downpayment.

So what does this mean?  Well, we can look at two factors that most likely matter:

1. The unemployment rate for this age group is dropping, allowing people to afford to move out

2. More people in this age group are getting married! And married people can’t live at home with their parents.  I mean, they can but that’s just weird.

With people beginning to move out of their parents’ basements or the apartments above the garage (I’m looking at you Kirk Cameron), we’re brought to the age old discussion of renting vs buying.  Right now this is an interesting discussion for me in particular, as I may or may not be moving to a Northern California city at some point in the next three or four months.

Or Argentina.  Argentina looks nice.

Or Argentina. Argentina looks nice.

We’ve spoken about renting vs buying before but I’ve started to get slightly annoyed with some people lately.  I won’t name names, mostly because they’re not online people, but in general, they don’t get the concept.  Here’s what I typically hear from them:

“Houses aren’t great investments because your money would be better off in the stock market.  The housing market went up like crazy before but you missed out on the recovery.  Besides, in the long run houses only appreciate at 1% a year, adjusted for inflation.  So why bother buying a house?”

Nope, nuh uh, no.  See, my problem here isn’t the whole housing appreciation thing.  I get that.  That number, however, is based off of housing appreciation from 1890 to 2011, adjusted for inflation.  That’s a pretty serious long term timeline there.  Longer than I will likely be alive but that’s beside the point.  The point here is that the alternative to buying is not investing that money in the stock market.  It’s renting.  And renting is the WORST.  There is 0% return on renting.  In fact, you’re just a consumer there, paying for someone else’s lunch.  I’m tired of people comparing buying to investing.  When you buy a house and your mortgage is comparable to what your rent would have been, you’re always going to come out ahead.

And with that, I think I’m officially in the market for a house, depending on where it is.  Preferably one with a gold leafed Eucalyptus tree in the backyard.

Wedding planning sucks

The thought of getting married to the woman of my dreams is awesome.  Seriously, I feel ridiculously lucky that I met her, somehow got her to go out with me and then eventually fall in love with me.  It’s absurd when I think about the whole story but hey, I’ll take it!  However, this has led me to a problem.  This is a somewhat large, not even remotely insignificant problem.

Weddings are expensive and suck to plan.  

Now, this is in no way an indictment on the wedding planning industry (that will likely come later) but seriously, this is rough.  See, the fiancé and I are having troubles with this.  Since we don’t know where we want to live, we don’t know where to have the wedding.  Since we don’t know where we want to have the wedding, we can’t entirely budget the event right.  Since we’re trying to pay for it entirely ourselves, we’re in a bit of a bind.  We initially wanted to have it next fall but at this point, we’re already too close to it.  That’s right, TOO close.  It’s a year away and it’s too close.

Then there is cost.  Even though I can’t quite budget things out yet, I’ve got a pretty good idea about the true cost of these events.  Last year, the average cost of a wedding in the U.S. was $28,400.  That’s more than my car cost.  That’s a downpayment on a house!  What’s even worse is that that is the national average, including places that are cheap.  In NY, the average was over $76K.  In Chicago, it’s nearly $50k.  Right now, I live in Los Angeles, a fairly expensive city in its own right.

They're smiling now but you should've seen them during the budgeting period

They’re smiling now but you should’ve seen them during the budgeting period

The Fiancé and I are trying to beat that amount.  Right now, the goal to get under is $20k.  I think we can do it but we’re going to need to find the right place, a good caterer, and some significant compromises.  For example, a lot of places charge you obscene amounts of money just to have your ceremony and reception there.  I’ve seen everything ranging from $4000 to $35K.  What’s worse is that is before you take food or the bar into account.  For us, we’re considering a cash bar (sorry everyone) and maxing out our cost per person for catering at $45.  With 100 guests, that will be $4500.  If we included a full bar, we’d likely be looking at another $3000.

None of these costs include silverware and plates, tables, chairs, and other items.  Some places may include them but many seem to charge extra.  After location costs you start having to take into account the wedding dress, rings, tuxes, invitations, etc.  Before you know it, the wedding is costing WAY more than you anticipated.

I’m hopeful that in the next few months, we’ll figure out where it is we’re going to live.  Then we’ll be able to get on from this limbo place we’re currently in.  Once we do, you’ll finally see my ridiculous wedding budget spreadsheet and my wedding cost tracking page.  Of course, if anyone wants to donate time or cash to helping us plan our wedding, we’re more than happy to take it!  Until next time

Photo credit to Meagan Jennett at www.meaganjennettphotography.zenfolio.com.  Get a shorter website name!

The first four rules of investing

So some of you out there might think that the stock market is the key to your growing fortune.  And while you’re mostly right, especially if you have a 401k or use index funds to grow your wealth, you’re also kind of wrong.  Not by much, mind you, just a tiny bit.  The reason here is that more fortunes are lost on Wall Street than won.  This isn’t exclusive to just stocks but extends to private placements, forex trading, futures trading, the commodities market, and even bonds.  The reason here is that many people, quite simply, don’t understand the way the market works.  So here are four rules for investing in individual companies, just to start, to help keep you safe, grow your wealth and keep your mind at ease.

1.  Neither give advice on what stocks to buy nor take advice blindly from people, whether they are brokers, investment bankers or simple some blogger writing about stuff.  Let’s face it, if you don’t know a company inside and out, know their growth record, profitability, when their debt is coming due, etc, you probably don’t know the company well enough to invest in them.  Some people, mainly technical traders who work off trends in the market, might argue that you don’t need to know anything about a company to profit off this.  While this may be true for traders who make millions of dollars a year, it is rarely true for the individual investor putting a couple hundred dollars into the market.

2.  Take your profits when you do and don’t worry about missed profits.  Sometimes you buy a company, sell it for a profit and then watch it keep going up.  Yeah, that sucks.  But you still made money.  Don’t get greedy!  When you invest, it’s the little things that matter.  Making a sure profit is better than taking a loss.

a.  There is of course a minor side note to this rule.  If you’re investing in the market, don’t day trade and make 30 or 40 trades a day! Be selective, find a good investment and hold onto it for the long term. You’ll lower your tax costs on the transaction by turning it into a long term capital gain and you’ll weather ups and downs more easily.

3.  Profits will come and go from day to day.  Some days you’ll be up 3 or 4% while others you may be down 10%.  Don’t let the bastards get you down.  You need to be patient, trust yourself and the decisions you made.  You may have to adjust your stocks over time to account for material adverse changes in some investments but overall, be patient.  It’ll take you much further than panic and fear will.

I think this guy has it down pretty good

I think this guy has it down pretty good

4.  You can’t survive the market without capital, patience, and an understanding of risk.  It doesn’t matter what you’re trying to invest in, eventually you’re going to run into rumors and ghosts.  You’ll hear people telling you to bet big on this one opportunity, that you can make a fortune shorting this penny stock while going long on porkbellies and trying to corner the orange concentrate market.  You’ll need to be patient in your actions, never push your risk beyond what is safe and don’t jump into any market if you don’t have the capital to survive it.

There are two running themes through all four of these rules.  They all have to do with patience and the psychological strength one may possess.  Ultimately, these are going to be two of the most important aspects of any part of your life.  If you’re investing, you need to be patient but also able to walk away from a loss without letting it break your stride.  You need to be patient while paying your debts in life and never be afraid that your plan won’t work.

You may recognize this philosophy a little bit from Mr. Money Mustache and from Stephen Covey’s book The 7 Habits of Highly Effective People.  It has a lot to do with how we run our lives and how we handle investing.  The basis here is that there are only so many things that we can control in our lives but we concern ourselves with many things we have no influence over.  Investing falls firmly into this.  We can’t control where the market goes, which company will be profitable and which company will fail.  Concerns like this are not things we can control.  What we can control is when we buy and sell stocks.  We can control how much profit or loss we will incur.  This is the psychological strength we need in our day to day lives.  It allows us to be patient and strong during market ups and downs and allows us to recognize what we can and cannot control in our day.  

So stop worrying about the market, the debt limit, etc.  You can’t control those things.  If this whole debt limit showdown gets to you, then vote for someone else next time or run for office yourself, because that’s the limit of your control here.  If you’re going to start investing beyond index funds, follow the rules above.  You can’t control how the market will function but you can control your actions on the market.

Fear, Patience, and Faith in the Process

I was checking out an article the other day about Facebook.  The article basically scolds the people who panic-sold Facebook when it was in the $20’s for being impatient and letting fear rule the day.  This got me thinking about the whole process of investing and how it is connected to what we do in our everyday lives.  I don’t just mean the products we buy but I meant the way we choose to act on a daily basis, both internally and externally.

Let me start at the beginning here.  If you know me, and I think most of you do to some extent, you know that I have a tremendous amount of faith in the process.  What I mean by this is the process that occurs during our lives when we embark upon a normal, everyday commitment.  This can mean getting hired out of college to an entry level position, working your ass off for promotions and better paying jobs, hustling for connections, and then one day, ending up with a job that pays well and that you’re content with.  Or maybe you’re out of shape and decide to go to the gym, eat healthy and put in the effort rid yourself of flub.  Eventually, you’re in shape because you put in the work.  I’m saying is that in life there is rarely a roadmap but there is a direction for us to move in so we can accomplish our goals, whether we know them or not. There will undoubtably be ups and there will most certainly be downs.  Life is a process and it’s constantly evolving. We have to trust in the process, stay humble and patient, and one day our efforts are rewarded. 

 

Just keep going up that hill...

Just keep going up that hill…

There are two aspects of the process that I see most people struggling with..  First and foremost, people have trouble recognizing that there is even a process to many aspects of life.  They get trapped in the drudgery and bogged down by the nonsense without ever seeing which levers they need to pull to make their lives move forward.  I’ve spoken about this before and I’d have to equate it to the concept of unconscious incompetence: if you don’t see a problem then obviously you won’t think one might exist.  You may be unhappy but just not know why.  Unfortunately, there are way too many people out there like this.  You probably know someone like this.  It’s someone who thinks the system is out to get them or keeps getting in their own way through self-destructive habits but wonders why they are behind all their friends.  If you can’t recognize that there is a process to the many aspects of life, you won’t be able to effectively move forward in the process.  It require reflection on yourself in a way that many people are unable or unwilling to do, because of the hard truths it may reveal.

The second problem I’ve seen is patience.  We ALL have this problem at one time or another about one thing or another.  This is the part of the process that the author of the article on Facebook mentioned above (see, I’m tying it all together!) and is a problem that many of us struggle with every day.  Many of us get impatient in our careers and want to end up in high level roles much sooner than we’re ready.  We get impatient and want to graduate college sooner.  We want to buy a house before we’re ready, an expensive car, etc.  We’re impatient and we know it.  In the article mentioned above, the individuals who took part in the Facebook IPO and then lost money selling their shares suffered from a slightly different type of impatience.  Fear of financial loss led to impatience which eventually caused them to sell their shares, incurring an actual loss.  They lost faith in the process, grew impatient, and let fear drive their decisions.  The moment you allow fear to guide you, you will make mistakes and it will cost you dearly.

No matter your career path, you can’t let fear be a driver of decisions.  If your goal is financial Independence and you begin investing, understand that you will likely lose money at some point.  Life is a process. It’s going to keep going, so trust it, be patient and don’t let fear make the decisions for you.

 

I’d like to thank Allison from Any Afternoon and my Fiancé from Petite Gourmande for helping to review this post and keeping me from going crazy.  Thanks guys!

Is a Sou Sou right for you?

Also, what is a Sou Sou?  So some of you may have heard of this before but most of you haven’t.  I first heard about it from Planet Money a few months ago and I found it pretty interesting.  You see, a Sou Sou (or sou-sou) is an informal savings group.  Every month or week or other indeterminate length of time, you and your friends put an equal amount of money into a pot, after which the money all goes to one individual in the group.  The order in which everyone gets the money is already set so you know when you’ll get your money.  If there are 12 people in a group and they each save $100 a month, then that means that each one of them will get at least $1200 during one month of the year before the order starts over again.

I may have rushed that explanation a little bit but seriously, I find this savings method fascinating.  It developed in West Africa and the West Indies ages ago and people continue to use it to this day.  Interestingly enough, while doing a little research on it, I found that most young people use it to help pay for going to Carnival, quite possibly one of the most awesome and amazing looking things ever.

 

Definitely a good use of the Sou Sou.  Definitely.

Definitely a good use of the Sou Sou. Definitely.

But back to the reason I find this fascinating.  See, one of the main problems most people have with trying to establish their financial independence and even with trying to build good habits is a lack of self control and accountability.  What a Sou Sou does is it makes saving a group activity.  If you don’t put in your payment one month, you let down your friends and family and screw them out of their payday.  You break their trust they have in you.  This guilt alone should keep every member of the Sou Sou from letting bad savings habits creep into the mix.

While you’d be better off putting the money into a savings account or an indexed mutual fund and using compound interest to help build your cash, I can completely understand people utilizing this.  First off, it would be sweet to get a nice lump sum amount every once in a while.  I mean, what if the 12 people put aside $100 a week, instead of a month.  That means that every 12 weeks you would get $1200 put in your pocket.  That lump sum right there is amazing!  And you’ve built a good savings habit.  If you take that cash and sock it away somewhere, you’re good! You may have missed out on the interest but the fact remains, you’ve taken control of one aspect of your life and you’re helping others do it as well at the same time.  That’s not just great, that’s admirable!  One of the things I strive for is to help people get their finances under control and begin to take back their lives when it comes to money.  A sou sou can do more for a group of people than I ever could!

If you want to do a Sou Sou, I suggest getting together with close friends and family and putting one together.  Start out with people you trust.  If you want to really branch out there, there’s actually a website you can check out (http://sou-sous.com/home/) that is a sort of online community to help keep you accountable.  In the long run though, you’d probably be better off sticking with your close friends and family.  Trust is always going to be the most important thing when money is changing hands.  If you don’t trust someone, then you probably shouldn’t do a sou sou with them.  Or do business with them.  And definitely don’t tell them embarrassing stories about that time at that place. You know the one I’m talking about.  Definitely don’t tell them that.

So, in other news, I’m really looking for more interesting and innovative DIY finance tricks and tips, like the sou sou, that can help me and others improve themselves in their financial goals.  If you read or hear about anything, drop me a line!  If you’d like to write about it, let me know and we can absolutely feature you on the site.  Until next time!

Leaving LA

Got your attention, didn’t I?  Sorry for the hook there but it’s not necessarily a true statement yet.  Right now, the Fiancé and I are starting to evaluate our options.  Since I work remotely, it means that she can find a job she wants, anywhere in CA she wants, and we can go there.  Even better, it means that we can seriously re-evaluate how much money we are spending on our apartment, gas, etc, and find a place that can save us thousands of dollars a year.  Maybe, just maybe, we can even find a place where we can buy a house.

Unfortunately, most of California is pretty expensive.  The cool places to live (San Francisco, LA and San Diego) are all ridiculously expensive and don’t accomplish much with respects to saving us money.  That leaves the more inland cities of California and really, that means only one place: Sacramento.  We’ve been looking into Sacramento as a potential place to move eventually for a few weeks now and might even take a trip up soon in order to check it out.  I know, I haven’t even been there before but I’m considering a move there.  It’s crazy talk!  But remember, I’m a bit of a crazy person in the first place.  Besides, Sacramento has a couple of things going for it!  Things like:

  • Friends!  Some friends of ours have already moved up there and they LOVE it.  Always good to have a built in base when you move.
  • Lots and lots of legal positions.  It’s the capital of the largest state economically and population wise in the US.  The laws that get passed here tend to have a much wider range of influence than what happens in Providence (Sorry Ted).  This means lawyers galore!
  • Right between Tahoe and San Francisco.  Two places that are seriously awesome.  The fact that I could easily drive over to Tahoe, one of the best places to snowboard in the country, makes me a bit giddy.  Just saying.
  • Cheap, Cheap property.  The median 3 bedroom home price in LA right now is $524K.  In Sacramento it is $186K.  Not only that but the schools, in the right neighborhoods, tend to be much better than anything that the LAUSD has to offer.  I’m just saying, it’s a big difference.
Definite small city vibe

Definite small city vibe

Seriously, the house prices kill me.  Looking at homes in LA is just awful.  You can’t find a house in an OK area in LA that is under $450K, which by the way is WAY over any budget I could possibly ever come up with.  In Sacramento, we could buy an actually starter home in a good neighborhood for under $250K.  That means a 3 bedroom, two bathroom house with a bit of a yard for roughly the same amount or less that we pay now for a 1 bedroom apartment we do not own.  It may just be me but I definitely like the thought of owning rather than renting.

Mostly though, Sacramento (or San Francisco or San Diego) would just be a good change of pace from Los Angeles.  I’ve been here for four years now and the Fiancé has been here her whole life.  And quite honestly, LA has never been my place.  Some of you out there probably know what I mean.  It’s just never felt like a permanent home type place.  That’s the best way I can describe it.  Even with my current apartment, the dog, my Fiancé, LA still is just not quite the right place for me.

Now, obviously I need to visit Sacramento.  I’m not going to move to a place sight unseen.  The last time I did that, I ended up here in LA!  And lived in a fairly ghetto (although cheap) apartment for years.  But I at least feel confident that if we make a move, it will be the right one.

The Summer Hiatus is over!

And I’m back!  My summer hiatus was a fun distraction but it’s obviously time to get back to work.  So where have I been?  What’s been going on?  The past few months have been some of the busiest and craziest of my life.  Let’s go over a few things so I can catch you guys up:

  • I quit my job!
  • I got a new job!
  • I got engaged!
That's right, it's real!  And she said yes!

That’s right, it’s real! And she said yes!

I know I know, she said yes.  Never would’ve guessed that would happen to me! Huge life changes for me.

With regards to the job, well, I was at my previous company for almost four years.  It was a long time, I learned a lot and the people I met there were amazing.  Ultimately though, my upside just seemed limited.  An opportunity has come along that allows me to do roughly the same job but in a more senior capacity, with more freedom and leeway.  The best part of this job?  It’s remote.  I’ll be making significantly more money with a fantastic bonus plan all while working from my apartment.  And yes, Jackson the dog is EXTREMELY happy about this turn of events.

See, excited.  How can I say no to this face?

See, excited. How can I say no to this face?

So what does all of this mean?  Well, first off, I’m down a few thousand dollars from buying the ring.  Secondly, I have to save a whole lot more money for a wedding.  And third, well, third is the interesting part.  Since I work remote, it means that the fiancé and I have the opportunity to potentially move around a bit, find a cheaper place to live and get us a bit closer to financial independence.

You may have also noticed some changes to the site.  During the layoff I tried to find a wordpress theme that worked better for me.  Although the last theme looked good, it was a pain in the ass to try to customize.  It would never do quite what you wanted it to do.  But the theme isn’t going to be the only change.  Soon there will be a recommendations page and a Facebook page, both of which are long overdue.  We’re also going to be revamping the format for a little bit.  For the next few weeks, I’ll only be posting on Mondays, Wednesdays, and Fridays.  Starting in November, I’m hoping to have Tuesdays lined up as guest columnists, with Thursdays being book and product reviews.  As always, I’m looking for ideas and people to help for both days.  If you want to become a contributor to the site (perhaps you travel the world on a budget or are a lawyer looking to dispense some worldly advice) just send me an email and I’m sure we can work something out.

Look for my first new REAL post coming this Wednesday!  I’ve built up a bit of a reserve of content for the past few months, with lots of ideas and concepts that I need to throw out there.  Until next time!