Voo Doo Economics, Anyone, Anyone...

Lots of random thoughts of the day…

(1) Advertising.  I just read Consuming Kids, Protecting Our Children from the Onslaught of Marketing & Advertising. It was Ok, but there are times that the gal is a bit looney.  Although I agree with the general proposition that corporation branding has gotten out of control and that I don't really like the idea of Loo and Kali being nothing more than a target audience, I don't really think that broad based regulation of advertising is the way to go either.  I do think that there has to be some ounce of consumer responsibility.  It's sort of like blog advertising (which I'm sure will always be a gignormous ongoing debate in the bloggi-munity).  If we are to believe what is being reported, internet advertising is the new holy grail: micro-targeting, results based spending, etc, etc…  Although I personally dislike internet advertising, I'm not going to tromp on those who make a living from it.  Bravo for them.  Wish I could do the same.  But I do what I think is responsible for me.  I NEVER click through any side bar advertisements.  It I see a product that interests me, I'll do my own separate research.  And I always take the products being hawked through bloggers with a grain of salt, knowing that, like product placement, there are usually ulterior motives involved.  The only place I'm not so good at?  Books.  I'm pretty omnivorous with the reading, and I've actually bought a lot on internet suggestions.  But I'm ok with that.

(2) Spending.  I've cut back pretty drastically on my own personal consumption.  When I was an unmarried DINK, I spent a Carrie Bradshaw fortune on my personal upkeep every month (clothes, accessories, spa time, gym, make-up, other grooming essentials).  And despite that, I managed to pay off my college debts in under 10 years.  Now that I have all new law school debts (twice the amount and twice the fun!), two kids to think about, house-envy (as well as so-not-enough-money-to-afford-a-down-payment-itis) and a job that makes me wish I didn't have to have a job, I basically spent the last 3 months paring down my expenses.  Here is my list of things I've cut out of my life:

• All coffee shop expenses.  I haven't started packing lunches yet, but (shh! this is our secret) when I have to stay let and get to order in on the company's dime, I always order cheap and extra (we have a dollar cap) so that I have enough for lunch the next day.
• All spa/salon expenses.  I used to get a facial once a month for about $120 a pop.  I'd also get my hair cut/colored about once every three months for probably about $200.  I haven't gotten a facial since Loo was born and haven't gotten my hair cut in about 18 months.  I know this is kinda drastic, and I'm going to get a cheapish haircut soon because my poor sorry head of hair desperately needs it, I'm budgeting $60 for that.
• Pared down wardrobe.  Last year, I bought three pairs of shoes (one for work, one for a wedding and one for fun), two dresses (for the wedding), three suits and a half a dozen sweaters and slacks (for work).  If I had to guesstimate, I'd say that it was a total of about $3500 (and I'm going to guess that I used to spend closer to $6k a year on clothes and shoes in my DINK years).  But these were extraordinary expenses, since I was returning to work, and am about 2 sizes bigger than my pre-preganancy size.  I bought everything in the early spring, and basically spent nothing until last week, when I used a $200 Ann Taylor gift card I got for Christmas.
• Handbags.  My Achilles heel.  I used to spend easily 2-3 thousand a year on handbags.  (How stupid can I be, and I basically don't use any of them anymore).  I finally buckled last week and bought this beautiful Cole Haan bag, my first handbag in a year.  It's expensive, but since J and I didn't do Christmas for each other this year, it was my Christmas present (with J's approval).
• Going out.  If I've gone frugal here, it's mostly due to the kids.  On average, in my DINK days, I would eat out at least 4-5 times a week (if at an average of $25/meal, that would be a whopping $6000 a year!) and go to 2-3 movies a month (add in snacks for a total of $300-400/year).  We still do take out about 1-2 times a week, but that is much cheaper than eating out, and we saw one movie (total) last year.

Now that I look at this, how the heck did I manage it on my reasonable, but still lowish salary?  Oh yeah, J and I lived in subsidized housing in Asia.  Right.  Obviously, any savings in my personal consumption is largely offset by the costs of Loo and Kali.  But somehow, those costs don't seem as extravagant to me as a $7500 Birkin (no, I don't have one). 

All this leads me to:

(3) Waste.  My passions in life are WATER and GARBAGE.  No, seriously.  I think about water and garbage all the friggin time.  If I knew how to get into the business, I would seriously consider a career in water or waste management.  Clearly my over-consumption had an impact not only on my bottom line, but also on the environment.  I cringe to think of how much stuff I contributed to our landfills.  I'm still very very far from perfect, but I've improved in the following ways over the past year:

• I no longer buy bottled water.  This is a big deal for me because after all my years in asia, where the water is largely unpotable, I was sorta programmed to drink only bottled water.
• I've started to buy carbon offsets for when I travel.  I used to travel a whole heck of a lot, now I travel almost not at all.  So I don't have to offset too much, and I'm not yet fully decided that this is a real solution.  But in the meantime, I offset the small amount of flying I do do.
• I heart my prius.  Ok, not really a last year thing, but we ditched our second car when we moved to Boston from BFV.  We just have our prius now, which we hardly drive at all.  So we're significantly down on our carbon footprint.
• Socially conscious giving.  I don't give gifts anymore (except to psycho MIL, who would be very upset with not getting a gift, and the girls).  Instead, I donate to causes that I think match the recipient's personality in the recipient's name.  Last year, I donated to the Nature Conservancy, Kiva, the Red Cross, Care, and various universities.
• Using the library.  I've really started to take advantage of the library at J's school.  I used to buy most of what I read from Amazon or Powell, but now, I'll read the library copy first, and buy only what I think are must keeps (or what I can't find at the library).  The internet has helped hugely with this.  I can browse online when I have time, then I just email the call number to J, and he has the librarian pull the book and interoffice to him.
• Less consumption (see above).

Things I still want to do:

• Buy more local produce.  Not that they're not available, but right now, our nanny does most of our grocery shopping, and she's not so comfortable driving with the girls.  So we're stuck with supermarket foods for the time being, though I do buy organic when possible.
• I'd love to move somewhere where I could walk or bike to work instead of relying on even mass transit.  That would be cool.
• Energy conservation.  If we ever get a house, I'm planning to renovate it to be maximally energy efficient: double pane window, extra insulation, solar panels, the whole nine yards.  Because the $1000 + oil bills for heating are just scaring me.
• Downsizing.  We're used to having a lot.  We moved from a pretty large home in BFV to a itty bitty Boston apartment.  So we have a huge storage locker full of STUFF.  I'm hoping we'll either start looking for a house or decide to move locations by the end of this year, then I can really start to edit our STUFF.
• Politics.  Ok, global warming?  Deforestation?  Pollution?  Diminishing water supplies?  So want to get involved, but so don't have enough time.  Nuff said.

(4) Services.  This article is depressing.  Because I am a semi-subscriber to the great capitalist way.  And I say semi because I believe that we need to temper the benefits of capitalism (entrepreneurship, innovation, self-improvement, higher standards) with a careful government hand. 

I think globalization is mostly faboo.  Because I was part of it, because it was what allowed me to spend years working and living in asia.  Because I worked in all sorts of factories in asia, and I saw that it could be good.  But I could not ignore the deleterious effect it had on the U.S., where my heart and patriotism ultimately rests. 

But the U.S. should not be a production society.  Or we should produce, but we shouldn't produce toys and clothes and shoes.  We should produce movies, software, the highest tech goods (like the MacBook Air – droooool), energy efficient cars.  And we should have the best damn service economy in the world.  Because (1) you can't export most services and (2) if Americans are spending more on services, then they spend less on goods, then less consumption = less waste. 

And there are so many good services.  All teaching is service based.  All childcare.  A really good meal, a really good massage (mmmm)…

So it's strange to me that we are more likely to cut the services out from our budget before the goods.  Why is this?  Do we need stuff more than we need things done? 

(5) Resolutions.  I am not a resolutions kind of gal, but some of the PF bloggers have made a big to do on setting goals and trying to achieve them.  So here are my (short and sweet) financial goals (in order of importance):

• Continue to max out my 401(k).
• Try to fully fund the emergency fund (if we're suppose to have enough to cover out costs for six months, and assuming that our childcare can be reduced if one of us is not working, I think we need between $30-35k)
• Pay more than the monthly payment due on my student loans every month.
• Open 529 accounts for Loo and Kali and get $3-5k a piece into them.

Notice there is NOTHING about saving for a house.  Because for now, these goals are more important to me than real estate, and I think this will just about suck us dry.  If there is anything left at the end of the year, that will go toward our down-payment fund.

(6) Obama Obama Obama.  Please get yourself out of this quagmire and be the candidate we all know you can be.  Because (1) you will not be running against Bush, and where is all of your talk about bipartisanship?  Extend a hand, brother, extend a hand; (2) Billary annoys me too, but people say that she can be pleasant to work with, as long as not in a campaign competition context.  She'll always be a force in American politics, President or not and besides, this is below you; (3) Senator Edwards is your friend.  He needs to be back in the spotlight, pronto, because 14% of the vote is nothing to scoff at when you're seriously trailing in total candidates.  Two voices with the same message (i.e. Clinton represents everything that we as a nation are trying to move beyond) is always better than one.

Comments

[halfmama]

Your title made me laugh. I was just talking to G about that line the other day.

I'm so impressed with your cutbacks and resolutions! I should print this out and try and follow the same.

We saw a financial planner years ago, who told us we need to put away $400-600 a month PER CHILD if we want to pay for college. Yeah, right.

We did, however, get a UPromise card, put away our airline-accumulating cards with a big sigh, and start using our UPromise card for EVERYTHING. I used to use my debit card for everything. Now I use the UPromise and just pay it off every month. We put some money away for the twins every month in their 529/Upromise accts but nowhere NEAR $400. At least the UPromise helps out every month. We'll take whatever we can get. You get more points w/the credit card and even more when you use/buy UPromise affiliates (like Mobil gas).

If we can pay for some of their future education, I'll feel a little bit better. But... OUCH.

[Mama Nabi]

(wow, the powers that be do not want me commenting here - this is my 3rd attempt...)

Yeah, I coughed up some coffee when I read what you and halfmama are doing to put away month for 529 accounts... damn, LN better get some scholarships or it's home-colleging! (no, I kid - once I'm on my own budget, I'm hoping to start something... small scale but.)
THat purse IS cute. One of these days, I will get me a real purse instead of using pockets and diaper bags.

I think, inspired by this list, I will make my own budget list. I like your socially conscious giving idea... although, I think I may have a hard time giving up my one weekly indulgence of soy latte... :-)