Did You Pay For College?

Posted by random olio

I recently read this discussion called: “Why Kids Should Chip in for College.” It is a discussion I support. I had to pay my way through college and while it was tough, it was good life experience for me. It starts the reality that life costs money in a big way. Maybe you do not have to have your child pay for school completely, but they should contribute. If not, what happens when they graduate? Will you continue to pay for their life? How have you helped them to prepare for the next stage of their life where they have to pay rent, utilities, food, car payments, insurance, etc.?

These days with the zillions of technical devices we have at our finger tips, the ease of access to credit cards, and dwindling checking accounts, those graduating from college will have a harder time balancing the cost of their wants with the bills they will now have to pay, with the amount in their paychecks. Do we need to shift the balance of what we are doing for kids today? Have we taught them the value of the cost of life itself?

I remember a class we had to take in high school. I cannot remember what it was called, but what I do recall is that we had a section on stocks. We were split up into teams and we had to decide what stocks we were going to buy together based on the research we did on the company, the rate of return, and many other factors. I cannot remember how well my team did, but it sparked a new thrill inside me of something I had never been exposed to – investing. What I find interesting about this class that we were required to take, was that we never learned about the basics of money: balancing a checkbook, living within your means, interest rates, deciding between how much you can make saving versus paying off debt, and saving for retirement. These aspects of personal finance would have benefitted us way before we were ever at a place to actually invest in stocks.

I wonder how many college graduates know those core personal finances ideas. Are most college graduates savvy with their social media profiles, and maybe how to create their next app, but not ready for the basics of paying their rent, and saving for their next plane ticket? Are we coddling kids today, rather than finding ways for them to be set up for success?

What do you think? Are we preparing today’s college graduates for their best financial future?

How do you make your money decisions?

Posted by random olio

Do you talk with your spouse about money? I do, but I know it is not necessarily the norm. I am what you might call a money freak. Even so, I have relaxed over the past year. I am maybe now more of just a fiend rather than a freak. Growing up without many things has made me keenly aware of where I spend my money, and yet, that only matters if Chris and I are on the same page about money.

We were not always on the same page. It is something that has evolved over time. The evolution has happened because we talk. We talk about most purchases. Some of you might say that is a bit over the top, and yes it might be. Regardless of whether it is extreme, it works for us. There is no ill will about what either of us has purchased because we both agreed on it before dropping the credit card. You might ask, “Do you talk about every single purchase?” The answer is no. For the most part we do not talk about the normal everyday purchase, like grocery items, but we do talk about most purchases over $100. It means there is no resentment, and it is easy. It is as simple as sending each other a text if we want to make a larger purchase. If the other is not sure, we wait until we can have a regular conversation.

Why does it work? It works because we have a few rules, and it is grounded on a sense of respect for the other individual and their opinion. We have shared finances, so we believe that we have a shared stake in the decisions on how we spend that shared money. One of the first rules we have is that we do not spend outside our means. If we cannot afford it, we do not make the purchase. It would have to be an emergency for us to spend outside our means. I strongly believe that if you buy only what you can afford, you will have a lot less stress in your life, and if you take that stand you will feel more like you, then living outside of who you are. The result of living within what we can afford, means not living off of our credit cards. Whatever we charge must be paid in full when the bill arrives. It feels more honest and true to who we are, when you can actually pay for your purchase.

This is what works for us. It is in no way a judgement for how others make their money decisions. I found this older LearnVest post about how a couple handles their money decisions. I liked this line:

“Because of our open running dialogue about our finances, we never argue about money, unlike most couples.”

It is true. Honesty with open communication means little to no arguments about money. It does not mean that the conversations are always easy, but it does mean you are connected about how you want to live your life, spend your money, and engage in the world together.

What works for you?

*UPDATE* Wow. I am in a bit of shock. In full transparency, everything I just wrote about apparently happens only 99% of the time. In the time it took me to write this post, my husband strayed from our agreed-upon protocol for the first time in over 10 years and made a large purchase without discussing the final details together first. Although the purchase was made with the best of intentions, he knew better and got an earful from me. No, not because I’m a hard-ass and felt the urge to raise my voice, but because he should have had a simple, open dialogue about it first, come to an agreement, and then dropped the cash. #stilllearningtogether #patienceplease

Separate Finances? Shared Finances?

Posted by random olio

I was inspired by this article: “Separate Money Sane Marriage,” and it leads me to ask a question for those of you that might read this blog post. Separate finances vs. Shared finances? What are the pros and cons? I have resisted from doing a google search for everything the experts say. Partly because I think that the experts will be on both sides, and honestly I think that it is different for each couple or partnership. What works for one might not work for another.

I lean on the side of shared finances. I say that because it has worked for us. Maybe it is because of our communication style to talk about everything, including our finances. Maybe it is because when we got married we were broke, in debt, and we worked together to get out of debt, pay off credit cards, and student loans. It evolved into the idea for every facet of our lives: “What is yours is mine, what is mine is yours.” There are ebbs and flows when things we decide for Chris are more expensive or vice versa. That is part of marriage, part of life.

I can respect those that keep their finances separate, but I want to understand more about why. I know for some they might get married when they are older, and just prefer to continue to live their financial life as they have throughout the years. Why do others make that choice? What are the pros and cons?

I am curious to hear what you think! Feel free to leave a comment with your thoughts.