Financially Free

Not too long ago BA

posted a graphic about savings buckets and it made me think about mine. "Pay myself first" has long been my motto and a deposit to my savings is always the first "bill" to get paid each month. Over the years, to manage my savings, I've experimented with different strategies and eventually settled on keeping separate accounts (buckets) for different purposes. Some people might think it's a lot to keep track of, but it works for me and that's what matters. To eliminate paper clutter, I access my statements online.

Here is the current situation with my savings buckets:

Reserve Account #1: Used for periodic expenses such as taxes, insurance, HOA and timeshare dues, ID home expenses, etc. I deposit a predetermined amount from our income (my pension and dh's job) to this account each month. I use a "moneylink" feature that enables easy transfers to and from my checking account.

Reserve Account #2: Used for rental property expenses. I deposit a small amount to this account monthly in addition to a small but consistent net rental income. The savings account is linked to a dedicated checking account used only for rental expenses. The purpose is to have a reserve to offset any vacancies and to pay for maintenance and repairs.

Emergency Fund: This account contains ~2 years of "no-frills" living expenses, to be used in the unlikely event that a major economic meltdown results in our state teachers' pension funds being frozen, reduced, or eliminated. In this economy, you just can't count on anything being constant, so I believe in being prepared. These funds are in staggered CDs earning 3.75-4.17%.

Tax Sheltered Retirement Accounts: Now that I'm retired I can no longer contribute to these accounts, but dh will contribute to his until he retires in June, 2009. I am not sure when we will draw from these, but we'd like to hold off until the mandatory age of 70 1/2. The financial planner I've used for many years has invested my 403b and IRA funds in various products that preserve the principal and earn a return of 2-5%. I have always opted for a "conservative" approach with my retirement funds, even when we've been in a bull market, something I'm now happy about given the state of the economy.

Personal Savings: Dh and I each have our own personal savings account that is our sole and separate property. Mine is with WAMU/Chase and his is with a credit union. We are free to use these funds as we please. For example, we draw from these accounts when we need to subsidize travel, a new laptop, or anything else. We each deposit equal amounts into these accounts each month, ~15-20% of our income.

My Fun Fund: Dh and I have a goal of traveling more in our retirement. So, I've decided to dedicate my small ING savings account for travel. The money saved in this travel account will include net earnings from consulting or part-time work and other misc. sources (e.g., recycling, rebates, etc.). Travel can be expensive, so having this dedicated account will motivated me to save in small ways that add up over time.

So, not including the retirement accounts, I have two "reserve" accounts, an emergency fund, our two personal savings accounts, and the ING Fun Fund, for a total of SIX accounts. It is a lot to track, but going online for balances and using a spreadsheet fore record-keeping makes the management easy. Especially now that I am retired, my savings gives me peace of mind, not to mention some welcome passive income.

Note: Stock dividends also provide passive income, but it is automatically reinvested. I don't consider the brokerage account as a "savings" account but rather an investment account that is liquid.

On my Mac, I use Firefox as my preferred browser. But, depending on the web-based program I am accessing, I occasionally have to use Safari or Explorer. Today, while using Explorer, I meandered over to SA and noticed that some blogs, including mine, do not show all of the widgets that appear when I use Firefox or Safari. Does anyone know why this happens?

Yesterday afternoon, dh and I went to the MacWorld Conference and Expo in SF. We wanted to go see all the newest gadgets in the exhibit halls and were able to get in free because of our work with the university (it's $25 per person just to get in to the exhibit halls). Then, while we were in line waiting pay for lunch, a very nice lady came up to us and gave us a coupon for $15 off. Our lunch was only $12.25 so it was completely free. One of our friends came with us and he insisted on paying for the parking ($13) since dh drove, so it was a pretty inexpensive outing.

I did spend $40 on a set of

Tweakers from Grandmax. These are small, portable speakers I can use with both my computer and my iPhone (for the iTunes feature). I tried out at least five different types of portable speakers, and selected these for the clear, powerful sound that is just incredible. They are reasonably priced (especially compared to some of the others) and will be perfect for travel... they even come with a sturdy pouch.

Tweakers are not widely available yet, but I think that once the word gets out, they will be a hit. My friend also bought some and now dh wishes he had bought a set to use when he needs to project sound from his computer during some of his presentations. Even TC the cat is fascinated with them!

Today I came across Thomas Jefferson's Ten Rules for a Good Life and thought it was worth sharing. IMO, these "rules" are still applicable 180+ years after he died:

1. Never put off till tomorrow what you can do today.

2. Never trouble another for what you can do yourself.

3. Never spend your money before you have it.

4. Never buy what you do not want because it is cheap; it will never be dear to you.

5. Pride costs us more than hunger, thirst, and cold.

6. Never repent of having eaten too little.

7. Nothing is troublesome that we do willingly.

8. Don't let the evils which have never happened cost you pain.

9. Always take things by their smooth handle.

10. When angry, count to ten before you speak; if very angry, count to one hundred.

Yesterday afternoon dh had to drop off some papers at the university and invited me to go along for the ride. Instead, I asked him to drop me off at my favorite Travelsmith outlet store that is close to where he was heading. He did and drove away. Lo and behold, the store was GONE... windows papered over, no sign of life. I called dh who came right back, then I called Travelsmith. Yep, they closed the Palo Alto store due to declining sales. Now the only outlet on the west coast is in Berkeley.

It's alarming to see the growing number of stores and businesses that have closed or are closing due to the recession. I see new ones all the time. The really sad thing is that people worked there... people whose lives have been impacted negatively. How is it in your neck of the woods? Are you seeing the same thing?

Yikes!!! I am shocked at how much I could theoretically buy on credit. Today, out of curiosity after reading monkeymama's post I decided to add up the credit lines on my credit cards, something I've never done before. I recently had a card closed by Cabela's because of non-use, so it also makes me wonder if I should close some accounts before another CC company decides it does not want/need me as a customer.

I only carry cards #1 and #2 with me, the rest are in the safe-deposit box. Since I pay off the cc bills monthly to avoid finance charges, I don't pay attention to the limits. And, I manage bills online, so I do not get any paper statements. Card #1 has a fee, the rest are "free."

I can see why it is so easy for people to sink into CC debt, especially if a financial crisis arises in one's life. Having this much credit could be very dangerous:

CC#1 - Airline Visa $35,000 LOC (most frequently used card, has a fee)
CC#2 - AmEx $27,800 LOC (used for Costco)
CC#3 - MBNA MC -$14,800 LOC (no longer used, opened 25 years ago)
CC#4 - LLB Visa $5,500 LOC (provides free shipping, rarely used)
CC#5 - Amazon Visa $12,500 LOC (provides free shipping, rarely used)
CC#6 - Chase Visa $8,000 LOC (provides gas rebate, rarely used)
CC#7 - Capitol One Visa $20,000 LOC (provides miles, rarely used)
CC#8 - Schwab Visa $20,000 LOC (rarely used, came with the account)
CC#9 - Macy's - Unable to determine LOC limit (rarely used)

I use the Macy's card occasionally when they have an additional 15% off promotion if you use the card (then pay it off when the bill comes). The LL Bean card gives free shipping and monogramming and this is nice at Christmas so I may keep it.

Apparently having all these cards has not hurt my FICO credit score but it still may be time to close some of them. First I have to investigate if there is an disadvantage to closing these accounts vs. keeping them open, even if I am not using them. I am not sure about the impact of closing accounts on your credit score. Does anyone know about this?

BTW, these numbers do not include dh's cards. He has 3 or 4 but only keeps one in his wallet and he uses it regularly for the rewards, but also pays it off each month.

Yesterday dh invited my DSS (31) and DSD (29) to lunch at one of their favorites restaurants which happens to be a national chain. It was not very busy so we were seated promptly in a private booth. The hostess gave us our menus and told us someone would soon be back to take our order. When my DSD opened her menu, she gasped... inside the menu was a $100 bill! Of course, we were all stunned. We even looked around to see if maybe we were on Candid Camera. (We weren't!)

We began a debate about how a $100 bill had gotten in the menu to begin with, and what to do about it. I suggested asking the manager if anyone had lost any $$, but not mentioning an amount... or that DSD could just give the $$ to the manager and let its disposition be on his/her conscience. DSD felt the $$ couldn't possibly be traced to anyone and that she should keep it because she had "found it." DSS adamantly agreed with DSD and dh agreed the decision should be my DSD's. Both DSD and DSS felt it was a "finder's keeper's" situation.

I suggested that DSD think about it and decide what to do after we ate lunch. Well, after lunch she made the decision to keep the $$ rather than turning it in "for someone else to keep." I wasn't comfortable with her decision and dh was no help ("It's up to her."). In the end, I decided not to fight the battle as I've had friction in the past with my DSD over her spending habits and I wanted to avoid conflict related to money. What would you have done?

In December we traveled to El Salvador to celebrate my aunt and uncle's 50th wedding anniversary. The best part of the trip was getting to know some family members I do not see very frequently, and of course, spending time with my "tios" (aunt, uncle). It had been two years since my last visit to El Salvador, the smallest yet most densely populated country in Central America. It is also the country of my birth.

I sometimes wonder how differently my life might have been had it not been for the devastating earthquake in 1951 that prompted my family to immigrate to the US where my sister and I grew up. Although we later became naturalized citizens, I continue to feel a bond to this unique and beautiful country, the source of many memories. As a child, we traveled to El Salvador every year or so. The visits became less frequent when I married, and then, the civil war began in 1980 making it more difficult to travel.

El Salvador is a country that continues to develop after the 12-year civil war that ended in 1992. In many ways, I see the influence of the USA. One of the most notable is the adoption of the American dollar as the national currency. It makes it easy for Americans to travel... no worry about currency exchange here.

The geography of El Salvador amazing: it is a land of beautiful volcanoes, lush rain forests, and compelling landscapes. You can travel from the mountains to the sea in a matter of hours.


One of my cousins has a house at the beach and it can be reached in less than an hour from their home in the city of San Salvador. The water is warm and the beach clean. A comfortable ocean-front home can be had for under $200,000, something unheard of in the USA. When I say ocean-front, I mean open the back gate and step onto the beach ocean-front.


We feasted on freshly caught oysters, shrimp, and fish. The house at the beach was one of my favorite places.


El Salvador's beaches are great for surfing, a popular sport. This is the view from the back deck of the house.


Tourism is a growing industry. El Salvador sometimes gets bad press regarding crime and danger to travelers, but we felt completely safe at all times. Of course, we were always escorted by a family member or a "motorista," familiar with the city and the traffic patterns. Rush hour in San Salvador can be just as ugly as it is in Silicon Valley or LA.

A favorite place we visited was La Palma, is a city known for its unique artistic style that features vivid colors and motifs from rural life. The buildings and even the light posts show off the unique art style.


That is my 80-year-old aunt in the green top... she is an amazing lady who has boundless energy. My dh is on the left. You can see wall paintings in the "La Palma" style on the right.


From my aunt's home, we can look down to the American Embassy, the largest in the Americas, situated in an area called Antiguo Cuscatlan. It is rumored that the building is built like a fortress, ready to house Americans in case of an emergency. There are many Americans living in El Salvador, and I think the number will increase because the American dollar goes much farther in El Salvador, making it attractive for retirees.

Some contrasts and comparisons with middle-class life in the USA:
-Many housing complexes, large and small, have 24 hour guards who monitor the premises and screen visitors;

-Homes are often built like "mini-fortresses" in that they have bars on the windows, heavy doors protecting the parking area through which you can usually access the front door. High concrete walls topped with concertina wire impede access through garden areas and back patios;

-Most homes that would be considered at least middle-class have an area called a "servicio" which is used by household help (e.g., nannies, maids);

-Homes are usually built without heaters... there is no need due to the mild climate;

-All banks and many businesses employ armed guards;

-Some food is more expensive or about the same as in the USA (canned goods, imported items) but some, such as fresh fruit, is far cheaper;

-Gas is currently ~ $2.25 a gallon, higher than it is where we live in CA;

-The cost of meals at many restaurants we visited (Caliche's, La Pampa, Hunan, Tony Roma's, Black Angus, etc.) is about the same as in the USA but beer and mixed drinks are much cheaper;

-American fast food is very popular (Pizza Hut, Burger King, McDonald's, etc.), especially with the younger crowd;

-Go to a shopping mall such as Galerias or La Gran Via and you will think you are in the USA... no difference, right down to the Christmas carols in English, Santa, and large trees with all the trimmings;

-In El Salvador, Costco is called PriceSmart and is a considered a good place to get bargains... membership required, just like in the US;

-Internet access is becoming more commonplace... we even had high-speed wireless where we stayed;

-Household help is very affordable by US measures: you can hire a full-time, live-in maid, motorista (chauffer), nanny, or cook for minimum wage that is about $175 a month. (One sobering thought: how does one live on $175 a month, especially when food can be as expensive as it is in the USA?)

And finally, one of my favorite things about El Salvador is the

cuisine. If you ever get a chance to eat in a Salvadoran restaurant, be sure to try the pupusas which are small stuffed corn tortillas. I also love the red beans with cream (frijoles con crema), fried plantains (platanos fritos), and the variety of fresh cheeses available. Now, I've made myself hungry.

That's me at the Club Tecleno, on the day of the anniversary party.

Once a year, I analyze our net worth to get a current picture of our financial position. To keep things simple, I don't include the value of autos or personal property. I use information from end-of-year statements and assessed values for real estate.

At the moment, fluctuations in our net worth do not have a significant impact on our lives. It helps that we live below our means and our income provides for our needs. In the future we will need to use assets to generate some income, but for now we are able to hold off. For example, we will draw from our assets if our pensions fail to keep pace with inflation (likely) or some other unexpected life event requires it. At 70 1/2 we will begin the mandatory Required Minimum Distributions from the tax-sheltered accounts.

Now that I've completed our net worth analysis for 2008, I know my goal of increasing our net worth by 5% in 2009 is very ambitious (see sidebar). Factors that could help: if real estate values bottom out and interest rates start to creep up... both possible, albeit not likely until the latter part of 2009, if at all. So we will see how things stand a year from now. Check out the page on my sidebar for my 2008 Net Worth Analysis if you are interested.

If you're curious how your own net worth stacks up against others your age and income bracket, use this

calculator to compare. I did, and I learned our net worth is above the median for people our age and income bracket... reassuring given that our net worth took a drop in 2008.

Here's another interesting idea: net worth vs. wealth. According to the calculator from The Millionaire Next Door, I am a PAW and my dh is an AAW. Authors Stanley and Danko argue that total net worth alone does not tell a good enough picture of one's wealth. What matters is how much worth you can accumulate on your income considering your own age. Therefore, a 30 year old making $25,000 who has a net worth of $80,000 has more relative wealth than a 50 year-old doctor making $200,000 a year who is only worth $500,000.

Both of the above calculators were borrowed from the Millionaire Mommy Next Door blog. She has a post with 110 calculators... a very handy resource.

Happy New Year everyone! We arrived home late yesterday afternoon from our trip to El Salvador... I will post highlights and pictures at a later date. While we thoroughly enjoyed our time there, it is great to be back home.

We brought in the new year quietly... just dh and I, and TC the cat who is delighted to have us home. Today has been a day to catch up on the snail mail, email, and my favorites blogs while I recover from a slight case of jet lag.

Later today I will spend some time on finances, particularly on calculating our net worth. One of my financial goals for 2009 is to increase our net worth by 5%. I plan to carefully review the monthly budget to identify some ways to achieve this. More on this later.

In a few hours, my dh and I will hop on a plane to visit family in Central America. Not sure I'll have Internet access while there, so I probably won't be able to keep up with SA member blogs, but I do look forward to catching up on your posts in a few weeks. To my blogmates at SA, may 2009 bring you good health, the love of family and friends, peace and prosperity.

Text is Happy Holidays! and Link is http://www.jacquielawson.com/viewcard.asp?code=1642606145724&source=jl999

Happy Holidays!

My cat is a casualty of my frugality, my dh teases. Why? I am unplugging the electric water bowl that filters and circulates her drinking water. The vet recommended this special bowl for my old cat, MC, before he passed away from kidney failure at age 18. I loved MC so much that I would have done almost anything to extend his life... and this bowl was one of the things I tried. According to my vet, cats prefer running water (an instinct from the wild). So, many cats will drink more if the water is "moving."

Well, the fancy bowl wasn't intended for TC, but she inherited it when she adopted us last December. The bowl is a royal pain in the patootie to clean, but I do it religiously and meticulously, otherwise it gets very yucky. Since we will be gone for a few weeks I do not want the pet sitter to deal with the chore of the weekly water bowl cleaning.

So, it's getting unplugged... and TC will have to get her fresh water daily from a large porcelain crock. No doubt, we might save a few pennies on the electricity, but that is not my motivation for unplugging it. TC will probably miss the running water because she likes to play with it, but at least she stays out of the toilet unlike MC... that used to be his favorite place for a drink if we forgot to put down the lid. And, I can always give TC back the special bowl when we return.

Or then again, maybe I will donate it to

Town Cats for their elderly guests.

Today felt like a super hectic day partly because I have so much to do before we leave on our trip in a few days. I started out early and dh went along on the errands, so that made things a little easier. I did get a lot done today:

Errands:
~Went to UPS and mailed Christmas package for my DDs and SILs
~Went to bank
~Made 10 Secret Santa deliveries
~Went to Staples to buy ink for the printer

Back at home:
~Entered grades on the web-based grade sheet for my class
~Did a load of laundry
~Ironed clothes I'm taking on trip
~Tried cutting TC's nails... (gave up)
~Wrote thank you notes for birthday gifts
~Confirmed with pet sitter and ride to airport
~Answered flagged email

Back out again:
~Had a late lunch with the professional group I am working with

Dh is now fixing his own dinner and I am not hungry at all after my late lunch. He is very good at fending for himself. In this afternoon's mail I received a pleasant surprise: a check for $1128.25. It is from a job I had offered to do pro bono but my former boss decided to pay me... and I'm happy to take it. I will set aside ~$400 for taxes, ~$400 to savings, fund 10 more Secret Santa gifts, and take the rest on the trip.

I still have lots to do:
1) Stock up on cat food and litter
2) Clean out refrigerator
3) Pack items that wrinkle
4) Go to bank again
5) Buy cleaning supplies the house cleaner wants
6) Make a doctor's appointment (for mid-January)
7) Pick up prescriptions
8) Make the rest of the Secret Santa deliveries
9) Type instructions for the pet sitter
10) Take TC to get her nails trimmed (or she'll scratch the furniture)

And I'm sure there's more that I just can't think of right now.

My daughter asked me why we would carry a mortgage if we could pay it off. Why not pay off the loan and not have a PI payment at all? Well to start with, my dh and I have different financial positions. While I could come up with my 50% of the loan, it would strain dh's resources to do likewise (it's complicated). So we will continue to have a mortgage on our CA house. And, thanks to a tip from monkeymama, we are now in the process of refinancing to 4.875% and this will save about $225 a month from the current payment. But assuming we could simply pay off the loan, would it be a good idea?

To answer this question using the new 4.875% numbers, I started with a

calculator that weighs various aspects of home ownership including the impact of property taxes, your standard deduction, and your tax rate. I also calculated the interest portion of our payment and what we could reasonably earn if we left the money in the bank. Here are the figures:

Annual payment (interest): $9263
Tax benefit by having a loan (per calculator above): $1936

Amount of interest earned on $190000 invested @ 4% = $7600
Minus 30% in taxes = $2280
Net investment income = $5320

Amount saved if we paid off mortgage: $9263 minus (5320+1936) = $2007

Bottom line: We could save ~$2000 a year we paid off the $190,000 loan, assuming my calculations are not flawed in some way. But we have decided not to for several reasons. Primarily, dh feels contributing his 50% of the payoff would deplete his cash reserves. We plan to live here only 5-6 more years, then we will sell our townhouse or rent it if we cannot sell. By not paying off the loan, we have access to larger cash reserves for future plans that include travel and possibly buying property in a foreign country. So, this compromise works for our situation.

In general, I think it is a good strategy to pay off your mortgage but everyone should assess their individual situation before doing so.

with my 2009 goal to reduce our carbon footprint. Our gas and electric bill came in ~ $10 higher than the previous month. But in comparing October and November 2007 with 2008, I have reduced energy consumption and saved money. We have had some mild fall weather, so this is likely a factor but I'll keep up the effort.

10/07 $87.16
10/08 $69.54
~20% less


11/07 $90.28
11/08 $79.67
~12% less

The semester is winding down and now it's time for me to meet with my student teachers for an "exit conference" to review their portfolios. It is a one-to-one meeting that lasts about an hour per candidate. I have been looking forward to these meetings because it's a time to reflect on the semester's successes and progress toward program requirements. Fortunately, I have a solid group of students and have no concerns with any of them... they are all on track.

My students asked to have our meeting at a little coffeehouse that's near campus but situated so that parking is free and abundant, unlike the university. So early yesterday morning, I went to the designated place and found a good table, one that would give us some privacy, relatively speaking, since it is a rather small but popular coffeehouse. It is not unusual to for study groups or faculty to park themselves for hours at this place. Between appointments, I observed those coming and going as well as people who sat at adjacent tables. Although I am not in the habit of eavesdropping, due to the close proximity of the tables I could not help but overhear some conversations.

Among the most "fascinating": Lady A and Lady B

Lady A: "So, you guys get any nibbles on the house yet?"

Lady B: "Nope. The realtor wants us to lower the price AGAIN! There goes any equity we might have. We may as well walk away if it goes any lower."

Lady A: "Oh, honey, I know what you mean. The equity in our house has dropped over 300 grand from a couple years ago. We thought we were all set but we'd be lucky to get a mil for it now. At least we don't have a mortgage."

Lady B: Silence.

Me, to self: Lady A, may I recommend a class in Sensitivity Training?

Another interesting interaction between mother and child waiting in line to order:

Boy (about 4): "Mama, I want one of these!" (grabbing a icing-decorated Santa cookie from display case.)

Mother: "No! Put it back."

Boy: "But I waaaaaaa nit!!!" (in whiney high-pitched voice)

Mother: "I said no!"

Boy: "I hate you!"

Mother: "Listen, you better settle down, you hear me?" Then she says to no one in particular: "He always makes me spend money I don't have!" and proceeds to pay for the cookie when she places her order.

Me, to self: May I recommend Parenting 101?

One of my 2009 goals is to reduce our carbon footprint (see sidebar). There are quite a few calculators on the web, but

the one I like gives me a good grasp on "doable" ways we can reduce our footprint. For our 2-person household, DH and I produce 16.44 tonnes (metric tons) of CO2 emissions. This is below the US average of 20.40 tonnes for a 2-person household. The average for the world's industrial nations is 11 tonnes, so we have lots of room for improvement. The worldwide target to combat climate change is 2 tonnes.

One way to reduce our carbon footprint is to become more efficient with our energy consumption (electricity, natural gas, gasoline). Another of my 2009 goals is connected to my carbon footprint: to reduce our gas/electric bill by 10%. Not only will it save us money, but also will have a positive impact on the environment.

When I worked, my school sponsored an annual holiday food drive and we filled many barrels with food for the needy. My students and their families donated generously, even though most had financial struggles of their own. Our efforts were recognized with awards and accolades, but to me the best reward was seeing the kindness and caring that this effort generated. Now that I'm retired, I do miss this event.

The local paper has been reporting that more than in past years, there is a severe shortage of food being donated to the local food banks. Understandably, the recession is a factor. Many people are challenged to put food on their own table and donating food, no matter how good the cause, is not an option for them right now.

So, this year DH and I agreed we would tell our close family, the ones we exchange gifts with (children, my sister and BIL, niece, nephew), that what we want for Christmas is for them to make a donation in our name to one of our favorite charities, the local food bank. We do not want to know the amount of the donation, just that one has been made.

Well, we've communicated our wishes, and everyone is on board... a few reluctantly because they wanted to get us "something." But I think everyone will follow-through. I love the idea for several reasons. First of all, we are helping others who are less fortunate. Secondly, no one will have to worry about what to get us. And last of all, DH and I are still working on simplifying our lives and really don't need any more "stuff" cluttering our small home.

Today I was reading an article about a young couple in the

"Millionaires in the Making" series on CNNMoney and something struck a chord with me. The husband in the article said he and his wife work at trying to "strike the delicate balance between saving for the future and living in the present" and that it is not an easy task. What a wise 27 year old! This young couple has saved some serious money, but they also understand the importance of enjoying the present.

This comment prompted me to reflect on my own experience and ponder the question of balance. All my life I've worked hard to save and prepare for my retirement and so now, here I am... retired. The future that was always the carrot that kept me focused is here. It is now. No more saving for retirement for me. I'm here.

In the last 15+ years since my daughters went off to college, I've probably been a workaholic, at least some of the time. My focus was on my job, working long hours, saving for retirement, working even longer hours, saving more... As I reflect about it, in some ways, before retiring, I had lost the balance in my life. And it wasn't because working longer hours resulted in more pay... I was salaried so it did not matter.

So here I am, happy to be retired and retired, trying to be happy. And while it's good to have the security of a pension and money in the bank - more than I will probably need in my lifetime - what was the trade off? I know I should have taken more time "to smell the roses," figuratively speaking.

Now that I'm retired, one of the things I've had to work on is learning to live in the present, to savor each and every day and revel in the simple pleasures that we can overlook when we make work an unbalanced priority in our lives. I have had to learn to get better at having fun and spending the money to do so without feeling guilty. It should not be this hard.

Balance is so important... and while I'm still working on finding my groove in retirement, I hope all the young people out there in the early stages of planning and preparing for the future do not forget to enjoy the present. Work to maintain that delicate balance because you cannot go back and "re-do" your life.

Yesterday my package from

Travelsmith arrived. I like many of their products but they can be expensive, so I watch for specials, promotions, or shop their outlet. I tried on the clothes and was very happy with my purchases. With S & H and tax I paid $75.30 for:

~ pair of "Seam Slimmer" black pants to replace a favorite pair (too loose) - $19.98 (retail $79)
~ white Coolmax 3/4 sleeve tee shirt, great in the tropics - $16.98 (retail $42)
~ pair of compression knee-highs to help leg circulation during air travel - $12.95
~ Purse-size Wonder cloth, chemical-free and great for traveling - $9.50
~ Emergency cell-phone charger - Free (Retail $25)

Oh, and they sent me a coupon for 10% off on my next purchase. There's just one little problem... the coupon expires December 1, 2008 and I received the package on December 4. Useless, but they would probably honor it if I squawked. I just don't have anything else I need to buy right now.

So, I saved over $100 for items I will use during my upcoming trip and for future travel as well. Now, I better go find stuff to donate... gotta follow my ROT #1.

$9.50 seems expensive for a square of cloth that is only 2 X 2 inches but it is chemical-free and will last for years. This one replaces one I forgot in a hotel room last summer... it's great for travel and gently exfoliates.

I have a friend, not a close friend, but someone I've known for a while and a nice person. Sometimes she grates on my nerves a little, so I do limit my contact. Well, I found out something today that's really been bugging me... and I'm beginning to think I might be overreacting. My friend has no children so her little cockapoo is like her "child." Being a pet lover, I understand this and it is not the problem.

When I ran into my friend while on a walk today, I noticed her pooch had on a cute little jacket. I commented that I had bought my cat TC, a cheap little "tu-tu" for her to wear in the Halloween photos I sent to some friends at my former workplace. These friends were instrumental in me adopting TC last December. The outfit cost $3.99 at Ross.... my friends loved the pix and strangely enough, TC loved wearing the tu-tu. It was all in fun.

Well, my friend proceeded to tell me in no uncertain terms that she would NEVER buy cheap clothes for her little "Fifi" (not the pooch's real name). In fact, all of Fifi's clothes are Louis Dog Products from

Fur My Pet. Puh-lease! I checked them out online and these dog clothes cost more than I spend on my own clothes. Would you buy your pooch a cashmere outfit that cost $105 and has to be dry-cleaned? Well, Fifi has several, plus a bed that cost over $100 that she "never uses."

My cat sleeps wherever she pleases, as cats are known to do, although she has a little carpet-covered drum I spent $49 on. It saves the furniture because she scratches her nails on it and I also stow all her toys in it. And I thought I had splurged on that. While I will not hesitate to spend on quality food and vet care, I draw the line on designer clothes.

So why is this bugging me? It's not that my friend can't afford it. She is wealthy, although she does not support any charitable causes by her own admission. Once when I was trying to get her to support Kiva, she told me she "doesn't trust" that her donations would actually be used as intended. I just feel that with so many people who are struggling, here is Fifi in her designer duds, living larger than the common man. I could buy 4 or 5 jackets for needy kids with the money spent on one of Fifi's sweaters. IMHO, there is something wrong with this picture. Or am I overreacting?

Around mid-December we leave for a two-week trip to El Salvador, the country of my birth. I have not been there for two years, so naturally I am excited about seeing my family. We will be celebrating my aunt and uncle's 50th wedding anniversary... a milestone nowadays and definitely one in our family where people either die or get divorced before reaching their 50th. Whenever we visit, DH and I are given the VIP treatment... everyone is kind and thoughtful and we always have a great time.

We will be there for Christmas, so I wanted to bring gifts, even if it is something small. My aunt, age 80, is my mother's younger sister and she has five children, and they are all married and have children of their own... so we are talking about a lot of relatives. Some I do not know well, others I am close to. Altogether, I needed to buy gifts for 26 people including a baby due in May. Packing all of this will be interesting to say the least.

I called this my "shopping challenge" because in keeping with import regulations, I had a $500 limit. Moreover, I rarely see some of these relatives so I don't know sizes, likes and so on. My challenge was completed well before Black Friday. A definite benefit of being retired is that I can go shopping in the middle of the day and not fight the crowds. And did I ever score some great bargains! So far, I've spent $319.94 for items that retail for $712.48. This takes care of 21 of the 26 relatives.

The only item I paid full price for was a beautiful, 8.4-inch digital frame that will be a gift for my aunt and uncle ($99 @ Costco.com). We will take photos of the family and the celebration and get everything set up for them while we are there. Everything else was bought on sale or with a discount of some kind. For the baby-to-be (gender unknown): Carter's blankets/bibs and a 7-inch Kodak digital frame for the parents (@ 50% discount). We spent more on them because they are generously housing us during our stay. For my aunt's five children, I bought five beautiful photo frames (5 X 7) and inserted recent photos of their children. This and some type of candy will be a "couple's gift."

Knowing these are favorites, I bought Sees chocolates, Jelly Bellys, and salt-water taffy. One cousin is getting a bottle of organic Napa Valley virgin olive oil to compare to that of his homeland (Milan, Italy). Three female cousins from a different branch of the family are getting a blouse, top, or Liz Claiborne PJs (I knew their size), and an XO wallet and handbag for a teenage cousin. Oh, and the ladies from the "Italian branch" of the family will also get some imported Italian soaps.

I gave up on the five teenage boys who will end up getting money (a new $20 bill). I just don't know sizes or what teenage boys like for that matter, so I saved myself a lot of stress and decided to just go with $$. The American dollar is the official currency of El Salvador, so this will have to do... money in a card. We'll also give some $$ to my aunt and uncle, hoping they'll use it toward a trip to the USA in 2009... or something special like that. And I know it will be OK because the invitation specifies "regalo de sobre" which is like the "money tree" people sometimes have at celebrations here in the US.

My favorite stores for bargains: Ross and TJ Maxx, hands down. You can't beat their deep discounts on name-brand items, but you do have to look around as sometimes these stores can get picked over. But this doesn't stop me... I am a patient shopper. Costco and Best Buy had good deals on high-quality digital frames. All in all, I am pleased that my "shopping challenge" was a success and that I stayed under budget. Now, I better go see about that packing...

December is a spendy month for many people, and it certainly is for us because it's the month property taxes are due. I generally pay our property taxes in early December, so today I wrote checks totaling a very tidy sum. This will take care of the first half of the property taxes. The second installments are due in April (CA) and June (ID).

I systematically save for property taxes since becoming my own impound manager a few years ago. (We carry a small mortgage on our CA home, otherwise this information would not be relevant.) There was a time the mortgage company managed the impounds (aka escrow account) but one day I realized that they usually take more then they need, and furthermore, they are earning interest on MY money. To manage the process, I created my own "impound reserve account" and deposit a prorated amount each month (it's an interest-earning savings). The prorated sum is the annual charge for taxes and insurance divided by 12. When it's time to pay the bills, I transfer funds to my checking account.

This strategy works for me because I'm disciplined enough to leave the funds untouched except for their intended purpose. I've known others who tried this method with disastrous results... they treated the impound account as an "emergency fund" rather than as encumbered money. If the money's not there when you need it, what's the point? Just let the lender manage it for you and be guaranteed its availability. Of course, you "pay" the lender for the service by letting them use your money for free.

The best part about taking control yourself: the interest this money earns for you adds up over time. For example, if you pay $6,000 a year in taxes (not unusual in CA), and make prorated deposits of $500 invested @ 2% compounded monthly, you will earn ~ $55. Keep in mind that the full $6,000 has not been in the account the entire year.

One caveat: stay on top of due dates because an inadvertent late payment will result in a fine, wiping out any earnings. This happened to me once when I was distracted by a particularly pressing issue at work, and I simply forgot. And what a dear price I paid for my oversight. So now I program due dates into my e-calendar to ensure a timely reminder.

Another point: if your mortgage includes PMI (mortgage insurance) because you have less than 20% equity, taking over your impound/escrow account is not an option.

Over the years, I have practiced what I call my Rules of Thumb (ROT). These are self-imposed "rules" I use to make my life easier or better. For example, ROT #1 helps me keep our small home clutter-free, especially after the massive purging of the

Great Downsize of '06. Following this ROT makes me think twice before acquiring more "stuff" I can do without (read: clutter, junk, dust collectors, gewgaws, useless objects...). I will share other ROTs later, but here is #1:

ROT #1: For any article of clothing or household item I purchase I must select a similar one I already own to give away.

How does this ROT help me? Well, to start with, I have an abundance of nice clothes, most of which are left over from my working days. And, because I take care of my belongings, these can last a very long time. They still fit and I wear them according to the seasons (sweaters, coats, jackets, shoes, blouses).

But sometimes I spot a good bargain and I begin to think I like it better than something I already have, or maybe some favorite piece actually gets worn out, or a household item gets broken. And, then there's the weight-gain situation. If I gain just a few pounds, some of my favorites don't look so good anymore. So, I might want to buy something new.

But, my ROT requires me to select a similar item (two is even better) to donate, give away, or throw away, depending on the circumstance. This insures I still have room in my closet to actually walk-in, and helps me keep impulse buying in check. It's not always easy to apply this ROT, so sometimes I have to work at it.

My "internal conversation" might go something like this:

Me: Ohhh, look at that cute little fleece jacket...and it's 50% off. I love the color!

Frugal alter ego: Yes, very nice. So, what jacket will you give away?

Me: Hmmm, I want to keep my down jacket, it was expensive and I wear it in the snow. My microfiber jacket is warm and water-repellant... gotta keep that one. I love my red fleece jacket that DS gave me... and the black fleece has zip-pockets I use for my keys when I go walking, so I don't want to give away that one... and...

Frugal alter ego: Well then, you really don't need ANOTHER cute little jacket, after all, do you?!

Anyway, you get the idea.

Kiva contacted me to confirm I have been accepted as a member of their translating team. I applied a few months ago, had to submit my resume and take a translating test (I passed). So, it's official... I am now part of the Kiva translating team, and I will work about 3-5 hours a week on the batches they send me. This is very doable and I have the option to decline an assignment if I am unable to meet the deadline (e.g., due to travel).

Before retiring, I spoke Spanish daily... 75% of my students and their families were Spanish-speakers, so it was a necessity. I also frequently translated newsletters and notices that were sent home with my students. Now, I only occasionally speak Spanish. By translating I will continue to use my skills and perhaps even expand them. Use it or lose it. Plus, it's great to be able to do volunteer work without leaving home, especially for a cause I believe in. Volunteering for Kiva is one of my 2009 goals, so I'm off to a good start.

Today is the last day of November and I've been blogging on SA for just over six months. So, I was thinking it might be time to share some things about me that most people do not know. I've read similar lists on Koppur's and baselle's blogs and found them interesting. So I've posted my list on my sidebar. I'd love to read your list if you are willing to share.

Today I spoke to two of my cousins in different parts of the world... DC1 is a first cousin who lives in El Salvador. She is my age and like another sister to me. We had a nice chat to catch up on family news. Before I knew it, 45 minutes had elapsed. In San Salvador there is a two-hour difference from CA time, so we usually find each other at home on a weekend afternoon. I can't wait to see her in a few weeks when we travel to ES.

A few minutes after speaking to DC1, her brother, my DC2, called me from Geneva, where he has lived for the last 25 years. He and I had a nice long chat, too. It was 11:45 p.m. in Geneva and snowing very hard. I love updates on how DC2's children are doing in college. What a very talented group they are. It is impressive that my DC2's three children are fluent in English (their mother is American), French (the language of Geneva), German (the other prominent language in Switzerland), and Spanish (my cousin's first language). He is also multilingual, like most of the Swiss.

Did I mention that both of my calls were free? This is why I love using

Skype. Not only are we able to communicate for free, we get to see each other on our computer's videocam.

I came across this interesting

article on Market Watch over my morning coffee... very timely just before the "Black Friday" kickoff to holiday spending.

I was surprised at how much the "average" person spends on holiday shopping. The article, "Recession-proof your finances," offers some good tips for saving money. How much do you plan to spend on your holiday shopping and are you doing anything differently this year?

Text is Happy Thanksgiving and Link is http://www.jacquielawson.com/viewcard.asp?code=1614082995724&source=jl999

Happy Thanksgiving

Why 59? Well, I decided I would have one for each year of my life and I will be 59 in 2009. When I started brainstorming, I had more than 59, but pared down my list to those that were most important (to me), including some that will be a challenge (losing weight) and others that I tend to procrastinate completing (eye/hearing exams). I removed my gardening goal because I love to spend time tending my container garden anyway, so it would be too easy. Exercising? Now that is a different story. And, yes, some goals are ambitious but I've always liked to set the bar high (e.g., save 15% of my retirement income). I created a page for my goals on my sidebar so I can refer to them frequently. As far as reviewing my 2008 goals... sadly, I didn't commit them to paper but my #1 goal was: Retire. Status: Accomplished!