What’s inside? Here are the questions answered in today’s reader mailbag, boiled down to summaries of five or fewer words. Click on the number to jump straight down to the question.
1. Using my stimulus check
2. Gas prices and hybrid cars
3. Worried about returning to work
4. Wedding planning suggestions?
5. Safely storing cash at home
6. CSA and safety
7. Financial success and self-worth
8. Figuring out break-even point
9. What’s the plan after unemployment?
10. Castile soap questions
11. Cost of living troubles
12. Thoughts on windfalls
One of the blessings of the last month or two has been the fact that I live in a rural area where it is really easy to just go on a long walk without seeing another living soul. I can walk from my house to a small forest preserve, walk the trails there and walk home, getting about an 8-mile walk, and maybe see five other people at a distance.
The ability to go on these long walks every so often (and on shorter walks most days) has really made a big difference for me personally in terms of handling all of the changes. My wife (a school teacher) and my three school-aged children are all at home, I’ve had friends and family touched by the virus (thankfully not me, unless I’ve had it asymptomatically, as of this writing) and almost all of my social routines have been altered.
Working in the sun-drenched parts of our home and going on walks has been the most effective thing in my life for keeping my head clear so that I can be a good parent, a good spouse and a good writer.
Sunshine and fresh air really help.
On with the questions.
Q1: Using my stimulus check
My stimulus money arrived a few days ago and it has been just sitting in my savings account. Right now I think of it as an emergency fund and I am trying to live on unemployment and a side gig delivering stuff. I don’t have any debt except a student loan. Pretty sure my old job will be waiting for me when the rules change. What should I do with the money?
– Adam
I’d leave it in your savings account for now.
When you have your old job back and it’s clear that it’s going to be a healthy business going forward, then I would assess what your major goals in the coming months are going to be. Are you going to need to replace your car soon? Are you saving anything for retirement? Do you have an emergency fund of any kind besides this stimulus check?
What should determine how you use that money is, well, the specifics of your own situation. That’s why it’s personal finance — it has a lot to do with your own specific situation and needs.
Still, for now, I would definitely sit tight, keep trying to live off of your unemployment and any side gig money you’re making, and see how things unfold. You may yet need that money to make ends meet.
Q2: Gas prices and hybrid cars
I had been intending to get a hybrid car to replace my old Corolla because I mainly use my car for commuting. With gas prices around $ 3, buying something that gets 50+ mpg versus 25 mpg makes a huge difference. Now with gas prices at $ 1 a gallon it doesn’t make much sense. I will have to replace this Corolla as soon as things are fairly normal again. But I am unsure about getting a hybrid now. Thoughts?
– Brandon
I think that gas prices are at a temporary low point, artificially held low by a number of global arrangements between oil producers shifting a bit paired with a huge drop in fuel demand. Both of those things will correct themselves over the coming year or so, and so I expect gas prices to rebound back to their previous $ 3 levels a year or two from now.
In short, I wouldn’t abandon the idea of buying a hybrid just because gas prices are temporarily really low due to a conflux of global events. You may find that hybrids are easier to buy in the coming months because people will buy more gas-guzzling options in the face of these temporarily lower fuel prices, but, as I noted, the low prices are a temporary thing.
As an aside, my wife has been making jokes about how she could drive 400 miles in her Prius for $ 8 in gas but there’s nowhere for her to go.
Q3: Worried about returning to work
I work at a nonessential manufacturing plant that has been closed since mid-March. My employer has been amazing and has paid us throughout the closure but they are going to reopen the first day the state allows it. I am scared to go back to work because my husband is immunocompromised. He can work from home with his job and they are probably not going back to the office for a long time. So what I am scared about is going back to work and there is a second wave and I bring it home to him and lose him. We can just barely get by if I quit and switch to his insurance. I also feel pretty awful just quitting after taking pay for sitting at home for weeks. I don’t know what to do.
– Amber
If I were you, I would be extremely candid with your employer when a firm reopen date is set. Once you know the plant is reopening in full and you’re going to go back, talk to them about the situation. Find out what they’re doing to mitigate the risks and whether you and your husband are comfortable with that.
I think this process starts by talking with your husband clearly about what conditions of work outside the home are acceptable to both of you. What if your workplace instituted social distancing and mask-wearing at all times for all employees? (I have heard of some businesses intending to reopen with this as a policy.)
Know what exactly you need to be able to return to work and then use that standard to decide whether to return to work.
If your current job has a situation that’s close, ask if they can do the things needed to take it over the “OK” line for you. If they’re not close at all, then I’d quit and immediately start looking for a similar job in a situation that meets your needs.
Q4: Wedding planning suggestions?
My fiancé and I were planning on getting married in July. We were originally planning a big wedding of about 250 people at a local winery. After a lot of talk and heartache, we decided that it wasn’t reasonable to do this and canceled the event even though we have lost our deposit. We now want to do something much smaller, perhaps even done entirely over video. We have asked around for advice on how to do this minimally and would like some suggestions on what expenses we should eliminate.
– Brenda
Honestly, if I were you guys, what I would do is have an extremely minimal wedding with just you and a small number of people present and stream it live to the internet for everyone who would want to watch it. You can pull that off in a park with fewer than 10 people around.
You can figure out a way that you two like for you to come together, say your vows, kiss the bride and such. Perhaps dance to a song together, then turn to the camera and thank everyone for coming and tell them that you want to have a big celebration with all of them present for your first or second anniversary.
Then, do something like you were originally planning in a year or two when the situation seems more appropriate.
You can pull off that kind of ultra-simple streamed wedding with just a few helpers, and all of them could maintain social distance while doing so.
Q5: Safely storing cash at home
What is the safest way to store cash at home?
– Derek
The safest place to store money in your home is in a fireproof safe that is firmly attached to the foundation of your home.
The type of burglar that could actually get money out of that kind of safe is not the kind that is going to be doing random home invasions, because the risk/reward is bad. Common house burglars won’t be able to get in. Such a safe will survive a house fire, an explosion, or a tornado.
Let’s say, though, that you don’t want to invest your money in that kind of safe. If that’s the situation, you want to ask yourself what risk you’re most trying to avoid.
If you’re not concerned at all about the time it would take you to retrieve it and you have a yard, I’d get a small and very secure container and bury it in the backyard somewhere. Choose a spot where you’re sure to remember it and bury it as deep as you reasonably can. There, it will survive fire, tornado, and theft; your main concern is water damage or underground animals like moles. If you do this, you need to be absolutely sure you know where it is in the future, so I’d suggest keeping instructions on where to find it somewhere, like in your estate documents.
Is your concern theft? Then you should put your money in a spot in your home that’s difficult to access, like in your attic or buried in the back of a closet inside an inconspicuous box because those things would take a lot of time to find and a home burglar isn’t going to stick around that long.
Is your concern fire? Then put it in a fire-proof safe somewhere in your home.
Is your concern a tornado or hurricane? Then I’d bury it, as described above.
In any case, I probably wouldn’t keep more than $ 1,000 in cash on my property no matter what. I’d keep the rest in a bank, where it’s protected under FDIC insurance and will also earn a bit of interest.
Q6: CSA and safety
I found you through your post on CSAs. Do you have any info or resources about CSA and food safety? We signed up for one in January and they will be starting normal deliveries next week but they haven’t responded to my questions about food safety and coronavirus. Don’t want to just have this food go to waste.
– Joely
I’m sure Joely is referring to this article about CSAs. Sarah and I have participated in local community-supported agriculture in the past, but aren’t doing so this year. We may do so again in the future. Mostly, we’ve struggled to deal with the sheer quantity of food, particularly outside of summer months.
I think it depends a lot on how you receive the food distributions. Do you have to go pick them up? If so, they’re hopefully doing pickups in a way that maintains social distancing. In my experience with CSAs, this shouldn’t be much of a problem unless it is a huge CSA with a bunch of customers and limited pick-up time.
If they drop off at your door, all you have to worry about is cleaning the items a little before storing. Wash them thoroughly with warm water, particularly if you intend to eat them raw, then wash your own hands afterward.
If I were you, I’d change your questions for them going forward. Simply ask them if they will make any changes to their process of picking up shares to maintain social distancing and keep everyone safe. Unless they’re being super-unfriendly to their customers — and probably hurting their long term business — they should be doing at least some common-sense things to help.
Q7: Financial success and self-worth
Would love to hear your thoughts on this article:
Basing self-worth on financial success leads to greater feelings of isolation and loneliness, study finds from MinnPost
– Jerry
The link is a newspaper article summarizing this academic study, which “revealed that basing one’s self-worth on financial success is associated with greater feelings of loneliness and social disconnection, and this may be related to experiencing less autonomy and spending less time with family and friends.”
I have somewhat mixed feelings about this. I think that if your financial success goal is entirely oriented around maximizing the balance of your bank account, you will probably make choices along the way that will alienate your social relationships.
Having said that, I don’t think many people really do that. I think that many people who strive for financial success do it because they recognize that financial success underpins a lot of things they want in life.
I want financial success not because I want a fat bank account, but because I want my kids to have great educational opportunities, I don’t want day-to-day money stress and I want to be able to engage in hobbies and social opportunities as they seem interesting to me. I want financial success so I can be a good parent, a good spouse, a good friend, and a good community member. Financial success serves those things.
I think that if your goal is financial success alone, without a purpose, then you may find it lonely and alienating. However, if your goal is financial success in the service of a greater life goal, then you’ll find that the greater life goal will define whether you feel lonely and alienated or not.
The reason is simple: if you’re practicing financial strategies in the service of a broader goal, you won’t make financial choices that undermine that goal. I won’t make a financial decision that would alienate my friends or put my wife or children in awkward positions, because those relationships are why I seek financial success.
Q8: Figuring out break-even point
Whenever I’m making a decision to invest in something like solar panels or buying a fuel efficient car I want to know the break-even point when the more I pay upfront will pay off because of lower upkeep costs. Those calculations are always off because the numbers are faulty.
– Barry
They’re always going to be off because things are going to change between the moment you buy the item and the moment you get rid of the item. Fuel prices will go up or maybe go down. Your usage might change — for example, you might have a longer commute, a shorter one or you might start working from home. Energy prices will go up or maybe go down. Inflation will happen — but how fast will it happen?
You can’t control or even predict those things. All you can do is calculate based on the prices you have right now and some reasonable assumptions about the future, but those assumptions will never be perfect.
Because of that, I tend to rely more on general principles than specifics. I’ll almost always err on the side of buying the more reliable version if the cost per use or cost per year is even close to the same. I’ll almost always err on the side of the thing that requires less fuel or energy or maintenance if the calculations show the total cost of ownership is even close to the same.
The reason’s simple — I’d rather burden myself right now with a big upfront cost than burden my future self with a quick replacement or a lot of maintenance expenses.
Basically, a person simply can’t accurately calculate a break-even point because the numbers will change going forward. All you can do is roughly estimate it and then make a gut call based on that estimate. For me, when I do those estimates, I tend to go for the more reliable / lower upkeep cost version if the estimate shows that the two options are at all comparable. I don’t worry too much about calculating the break-even point incredibly precisely, because the numbers in that calculation will shift somewhat over time.
Q9: What’s the plan after unemployment?
Do you have any general articles about what people should be doing if their unemployment is running out and they still haven’t found a job? Thanks!
– Mary
This will definitely be a subject for a full article in the near future, but here are a few tips to follow.
First of all, be communicative. You are almost always going to wind up in better shape if you take the first step in communicating your situation with the people to whom you owe money. Try to work out arrangements with them that will enable you to stay in your home and maintain basic services and not fall into a deep cycle of late fees and unpaid bills. Very, very few businesses would prefer to just cut you off during a time of trial than to work with you for a mutually beneficial outcome.
If you don’t already qualify for it, take a look at the Supplemental Nutrition Assistance Program (SNAP). It’s a USDA-sponsored program that helps people keep food on the table during times of financial struggle.
You’re going to want to consider any job that you can get your hands on, so widen the jobs you’re applying for substantially. Don’t keep holding out for management positions or the perfect programming gig.
If you’re considering some form of self-employment (ideally, if you’re considering this, you’ve already started down that path), see whether you can get some assistance from the Self-Employment Assistance Program.
Finally, and this is most important of all, be proactive. Don’t hide from the oncoming problem. You should be out there every day, spending the equivalent of a full workday, getting yourself in the best position you can. If you don’t have a job, you should be spending a workday trying to get a job or to get resources to keep your head above water. Avoiding the problem or procrastinating won’t fix anything.
Q10: Castile soap questions
Had some questions about your castile soap post.
1. How far can you dilute it and it’s still good for use?
2. Have you tried any other brands besides Dr. Bronners and Public Goods?
3. Does it smell bad?
– Amber
Amber is referring to my castile soap post from a few months ago.
First, you should generally stick to the recommendations for dilution on the bottle or on the website of the castile soap you buy. If you dilute something so much that it’s not cleaning well, you end up using more of the diluted stuff to get the same effect. For hand soap and body soap, we cut it to 3 parts water to 1 part soap because I want to build up a bit of lather; for household cleaning, I cut it to 24 parts water to 1 part soap because I don’t want any lather or residual soap at all. That’s using Dr. Bronners soap, and I’m basically following the recommendations from their website.
I haven’t tried any brands of castile soap besides Dr. Bronners and Public Goods. That’s mostly because I haven’t had to buy any more, because we still have some of our original batch.
I don’t think the soap has much odor on its own. Many castile soaps that you buy have some sort of additive to provide a scent; I really like citrus-scented soaps, so the Dr. Bronners citrus soap smells wonderful.
Q11: Cost of living troubles
I am lucky enough to have a job where I can work remotely. We previously had the occasional face-to-face meetings and retreats every few months but those are on hiatus. I am now thinking about moving to an area with a low cost of living when it is safe, but I am also worried about the quality of life while there.
– Ronald
What aspects of quality of life are you concerned with? I’d start by really drilling down into what you personally mean by that. Are you concerned about not having anything to do? Not being able to find like-minded people?
I’ve found that, if you find at least a few people who are interested in some of the things you are, it’s hard to be bored no matter where you’re at, and that you can find people with at least some overlapping interests almost anywhere outside of extremely rural areas. College towns are great examples of this, as they often have a reasonable cost of living and a very wide diversity of interests.
If you’re looking at a particular place, I’d look for online forums and message boards centered around that place and start lurking there and asking a few questions. Ask if people would recommend moving there. Ask what the community of people who are into whatever you’re into is like there.
Q12: Thoughts on windfalls
I found this quote from Pirate Hunters by Robert Kurson and thought you might want to share it. Maybe not inspirational but very thought-provoking.
Treasure shows who you really are. It strips away every façade you’ve constructed, every story you believe about yourself, and reveals the real you. If you are a miserable, lying, greedy, worthless [person], treasure will tell you that. If you are a good and decent person, treasure will tell you that, too. And you needn’t find a single coin to know. It’s enough to get close to treasure, to believe it within reach, and you’ll have your answer, but once it happens it can’t be lied about and it can’t be [rationalized] away. For that reason, treasure is crisis, because what you get in the end is yourself.
– Jim
This applies to any big windfall in life, I think, whether it’s something you earned or something that fell in your lap. What would you really do if you suddenly had $ 10 million?
I know this much about myself: if I had more money than I needed to live a life similar to what I have right now for the rest of my years, I would feel really uncomfortable and worried. I know that beyond a shadow of a doubt. I would look at anyone struggling to get by and feel really, really guilty, and I know that I would feel better giving it to a charity.
However, I would be extremely negative toward anyone that tried to scam me out of the extra money. I’d do a ton of diligence before giving the rest away, and I’d feel really good about that process. Giving it to the first person with a tough story would not do it for me; I’d be mad at myself and frustrated with them. I would definitely follow an “effective altruism” tack with that money and give it in the way that would do the most good by a lot of reasonable measures.
That is honestly what I would do. I could definitely say no to someone telling me a sob story, but I would feel very guilty not helping people genuinely in need, and having a lot more money than I need would stress me out in terms of keeping it secure and safe.
Got any questions? The best way to ask is to follow me on Facebook and ask questions directly there. I’ll attempt to answer them in a future mailbag (which, by way of full disclosure, may also get re-posted on other websites that pick up my blog). However, I do receive many, many questions per week, so I may not necessarily be able to answer yours.
