Mapgirl wrote about what she’d do if she lost her job and I thought it was a great idea for a post and tagged along. So, what would I do if I lost my job?

If I lost my job, my first move would be to tap the network of individuals I know in the area to see if their companies were hiring. The majority of those folks, at least the ones working for companies that would be looking for a software engineer, all work at my former employer, who would likely not be averse to hiring me back because I left on very amicable terms. Beyond that, there are a few other folks in the area that work for similar employers and since software engineers are usually in relatively strong demand, my best bets would be with one of them.

However, beyond that, I think I would start considering pursuing a career in another field, perhaps into something in the business management arena and less in engineering. If I were to go in this direction, I’d probably tap into the employment services department over at Johns Hopkins, where I’m pursuing an MBA, and see if they could put me in contact with folks looking to hire. I knew a lot of people out of school with engineering degrees that scored finance jobs because of the analytical skills they acquired in school, even though it was a different field.

I don’t think I would consider going the self-employment route and work on websites or anything like that. While it is certainly fun, it’s fun because I put in a limited amount of time on my own schedule. If the blog thing were elevated to my main source of income, I think that would ruin the allure and entertainment of it all. To write because I enjoy it and because I’m trying to share the things that I learn is fun, to write because it’s my job… I think that would ruin it. In addition to the enjoyment aspect of it, the unpredictability of it would also be a problem for me. Whatever it makes this month, there’s no guarantee they would make the same next month, or the next month. There are just too many unpredictable aspects involved for me to rely on it full time… plus it doesn’t come with health benefits.

Fortunately for me, my fiancée is employed and I have no dependents, so the pressure to immediately find income is not as high; but if my fiancée didn’t have a job or I had children, I’m sure I wouldn’t have the latitude to be casual about finding a new job. Either way, I don’t like being a bum so I suppose that’s enough self-pressure to find some gainful employment.

So, what would you do if you lost your job? Find another one in the same field? Different field? Or would you use it as an opportunity to do something completely different?

The article I just read was a little dated (Oct 2006) but it highlighted a very interesting service that I think is pretty cool, it’s essentially a rental service for accessories - jewelry, purses, etc. It’s a slightly different take on fractional ownership, most common in planes and yachts where you buy the right to fly a plane or sail a yacht for a specified number of days a year, and is more like Netflix, except for high end accessories.

Bag, Borrow or Steal was started by a couple guys who saw how much time, money, and energy their wives were spending on finding purses and handbags that matched their wardrobe. You pay $10 a month and then a per-item weekly fee but you get to borrow all sorts of stuff. A quick look on their site saw four levels of membership, based on the quality of the goods (Couture, Diva, Princess, Trendsetter) with membership fees ranging from $20/mo to $175/mo.

While my fiancée doesn’t buy a lot of handbags or accessories, I can see how these types of services can be very useful. The thing with shoes, handbags, and accessories is that after a little while the novelty of the thing wears off and they just don’t get worn anymore. They aren’t like cars, where you only have one and you use it until you need a new one, they’re constantly being swapped in and out of the rotation until they’re forgotten in the corner of the closet. While I don’t foresee anyone I know signing up for this (unless they have a Faux category with fake LV and Gucci purses for $5 a month), it certainly fills a need.

Source: MSNBC

Wow, did he just write that? A personal finance blogger doesn’t want to be rich? Is he insane? Should we even be reading a blog about money from a guy who doesn’t even want to be rich? Yes I just wrote that. Yes I don’t want to be rich. No I’m not insane and yes you should be reading and I’ll explain what I mean. Oh, and when I mean rich, I mean like lottery rich. The reason I don’t want to be rich (even though I will strive for it, just like everyone else chasing the American Dream) is because it comes with a lot more problems than it solves and the problems that it can’t solve are the ones that are especially difficult because they can’t be solved with money. Oh, and if the big red sign and the over the top talk didn’t give it away, this is a Devil’s Advocate post.

100% Of Lottery Winners End Up Dead
Winning the lottery actually kind of sucks. If you can get past the obvious play on words (100% of people end up dead… eventually) and think about the stories of the past lottery winners, very few end up in a solid financial situation a few years after winning. The reason is because all sorts of people come out of the woodwork and ask for a hand because you’re suddenly rich. Not only that, but those people feel as though you’re obligated to help them because you have so much money and if you don’t there will be hell to pay. Another reason? All sorts of crazies come out of the woodwork because they want a piece, legally or illegally, and they will stop at nothing to get it. Lastly, you can’t protect yourself against yourself. Lots of lottery winners quit their jobs, lose direction, start spending money like wild to entertain themselves… and end up coked up and dead in a ditch somewhere because a robbery went wrong. Don’t think this is true? Follow the sad tale of the last Powerball winner.

Lots of Rich Kids Are Spoiled
Why do people work? To provide for themselves and provide for their families. Working 8+ hours a day does wonders for keeping someone out of trouble, so what happens when you don’t have to work? You get yourself into trouble! See, if you were born with a silver spoon in your mouth, a few million in a trust fund, you can likely live the rest of your life very comfortably without working. If that is the case, what incentive is there for you to study hard, work hard, or do anything except play hard? None! It’s very difficult to teach someone to work hard if there is no incentive to do so, kids hardly want to do homework as it is, certainly don’t make it harder by letting them know they don’t ever really need to work. Sure, the “rich kids are spoiled” idea is an unfair generalization but, like all generalizations, it’s rooted in part in truth. Check out Paris Hilton, she’s about to go to jail and she’s lighting up a joint.

Poor People Less Likely To Be Robbed
Who is more likely to be robbed, me or someone rolling in a Mercedez Benz, wearing a Rolex, and sporting diamond studded earrings? If you would rather rob me, you’re a freaking fool. Rob the dude rolling in a Benz on his way home to his mountain villa because the return on investment will be much much higher and the chances of something going wrong is much lower. It’s lower because money is less important to Mr. Rolex, so he has a couple grand on him and you stick him up, he’s going to give it to you because a couple grand ain’t crap to him. You stick me up and I’ll fight tooth and nail to keep my twenty bucks and my Quizno’s frequent sandwich buyer card… and that damned card is expired anyway.

So, the moral of the story is that you don’t want to be filthy stinking rich.

About to start comparison shopping for a new digital camera? How about a new memory card for an old digital camera? Well, whatever you’re looking for, the best way to find the average price something is going for is to check the completed sales lists on eBay. eBay is a better gauge of prices than comparison shopping engines like PriceGrabber because you can typically find better prices on eBay for the exact same products because those sellers have less overhead and are typically extreme bargain hunters, able to get low prices though creative use of coupons and promotions. Remember though, only look at the Completed Listings (and filter out on price to filter out accessories) and be sure to account for any accessories the seller is throwing in.

Let’s take an example, if you look at the completed listings for the CASIO EXILIM EX-Z70 that have an end price over $50 (to cut out accessories), you’ll see that the CASIO EXILIM EX-Z70 plus a 1GB memory card will cost you around $200 (including shipping); no memory card and the price drops about $10-$20 less. If you try PriceGrabber, the CASIO EXILIM EX-Z70 isn’t even listed! If you check Amazon, the CASIO EXILIM EX-Z70 goes for about $250… so, the moral is that eBay is a good price benchmark if you want some quick and dirty information.

After my recent trip to China, thoughts of how I should’ve best converted by hard earned US dollars into Chinese RMB were still in my mind and so I scoured the internet in preparation for my next trip out of the country, whenever it may be. The problem is quite simple, how do you get the most USD into the local currency without paying through the nose in fees, getting ripped off in the rate, or converting too much (in trying to save money) that I find myself blowing it on stupid trinkets in the airport on the way out? The answers essentially boil into four possible choices but in the ever changing environment of money, before making any decisions for yourself, verify that the fees I’ve listed are still current though the essential ideas will likely remain the same.

Credit Cards
Credit cards are usually the best option because the currency conversion is usually at the wholesale rate, not the retail rate you’d be expected to pay if you chose to exchange money at the airport, hotel, or bank. The credit cards also offer the same level of security internationally as you would expect domestically. The downsides are that some card issues will charge you a currency conversion fee as high as 3%, I tracked down a list of credit card currency conversion fees a few days ago - tops on the list was Capital One that had no fee.

ATM
Not everywhere takes credit card so your next best option is to withdraw cash from a local ATM. You get the benefit of exchanging money at the wholesale rate with the flexibility of using the local currency, the only downside is that you’ll probably be socked with an ATM fee (experts estimate a flat fee would be around $1-$5 where a percentage wuld be 1-2%), one that’s larger than the typical fee you may see in the US. Other tips, cleaned from a dated MSNBC article, include changing your PIN to something that’s only four numbers (a common limit internationally), and making sure you can find a PLUS (for VISA) and/or Cirrus (for MasterCard) ATM where you’re going.

Traveler’s Cheques
Like cash with some added security features, cheques are expensive options and only available on a limited basis. For the purposes of this article I only looked at American Express Traveler’s Cheques which seemed like a good option only if you didn’t have a credit card and didn’t trust yourself with cash. AMEX offers traveler’s cheques in foreign currencies but there is usually fee associated with purchasing them, $15 if you order them online (fee waived for Gold Card and Platinum Card holders) plus shipping and handling. As for the use of them, you may find it difficult to use cheques, especially at small local shops that won’t recognize them, and converting them at a local bank into currency may come with a small fee as well. For the added security, you sure get nickel and dimed all the way to your purchase. (AMEX Traveler’s Cheque FAQ)

Exchanging Cash
This is probably the worst option (though next to AMEX Cheques depending on how much) because your exchange rate will be retail, which is always going to be more expensive that wholesale. Also, no matter where you go to do the exchange, the exchanger is going to want to take a little piece and put it into his or her pocket. Banks and hotels are usually your best options, they will typically offer the best rates but keep yourself aware of the rates every day so you can tell if you’re getting ripped off. Also ask if there is a currency conversion fee associated with the conversion, sometimes there is and it’s not listed on the board.

Ultimately though, remember that we’re talking a couple percentage point differences between each of the options so ultimately it might not matter terribly, it’s just good to know where all the options stands in case you are put to a decision on the spot. Should you pull out a credit card or use the cash you have? Should you hit up an ATM or convert some money from USD at the airport? The differences will be minimal but that doesn’t mean you shouldn’t be smart about it.

If you have any tips you want to share about spending money internationally, please do share! I don’t do a lot of international travel so my experience is limited, I’d really like to here some seasoned travelers share their best tricks. Thanks!

Images by wajakemek, Trevor D., and erin.

Him of Make Love Not Debt just recently wrote about Asian Culture and Finances and the concept of children supporting their parents and asked that I share my own thoughts on the subject.

I don’t feel compelled to “pay my parents back for raising me” nor do my parents feel as though they should be “paid back for raising me,” however, I do whatever they ask because they’re my parents - not because I feel obligated because they raised me. At the moment I don’t send money home not because I’m a derelict son but because my parents didn’t ask me to, if they did I would certainly send money home. If my parents did need money, I’d send it in a heartbeat; I very much believe in the concept that everything is the family’s money. What I make goes into a pot that can be used for anyone else in the family, it just happens to be in an account with my name on it (or in an account with someone else’s name on it).

The thing is, every family dynamic in every culture is different. Take for example the story of Mai, who was laid off and still spent $6,000 on his parents for a vacation package to China. In my family, if I was laid off, the last thing my parents would want me to do is spend $6k so they could go on a trip to China. I don’t know if that out of responsibility or what, but in my family it wouldn’t be something that made sense. No job and you spend $6k on anything (let alone a vacation for anyone, you can always wait until next year after a job has been secured)? That just wouldn’t fly. (Of course, that story might be a little overblown just to get in the papers but whatever)

How does this work with my fiancee, who isn’t Asian? It better jive just fine because that’s the way it is.

Just kidding. She’s fine with it because her sense of family is just as strong as mine, though the basic ground rules are slightly different as one would expect from a different family and a different culture. She’s a very caring and generous person, even to strangers, and so if you ask for her opinion of caring for someone who is actually related to you, it’s a no-brainer. I don’t think I could marry someone who wasn’t. (Crowd: Awww…)

Just as a friendly reminder to all of you who still use regular USPS, the rate hike will take effect on May 14th and a first class letter will go from 39 cents to 41 cents. Dymo, whoever they are, is giving away ten 2c stamps so help you with the surge, offer ends Sept. 1.

FMF explains how not all index funds are not equal whereas MBH discusses how not all priority mail boxes are equal.

Nickel writes about the latest 6 month Citi Divident Platinum Select promo, but I say down with these stupid teaser promo rates!

JLP makes a case for diversification as the Dow hits new all-time highs while the NASDAQ isn’t even close to its former peak.

Flexo’s auto insurance is going up but not as much as he thought it would considering his accident. My insurance cost has been going down by around $25-$40 every single renewal (I pay for 6 month increments), not sure why other than I’m getting older?

Ever wonder what it meant when someone said your home was on a 100 year flood plain? I write briefly on what that means at Homeowners Insurance Guide.

Don’t think you should review your insurance policies? Don’t think you really need an emergency fund? Read this story from Trent about the things he learned The Flood of 1993 (of the Mississippi River, where a levee broke, it was bad) and you’ll likely think twice. Three times even.

JD lists five ways to earn a little more money. I thought it was funny that one of the reasons for doing this was to pay off debt and one of the ways to earn cash was to sell your stuff, makes you wonder if some folks are filling up one hole by digging a new one.

Congratulations goes out to…

• Stephanie
• marie
• Tyler
• geri g
• Tricia

I’ve sent out emails to the winners, if they don’t respond by next Friday (5/18), I’ll select any necessary replacements. Other bloggers may notice that entrants who were bloggers also won a free link in addition to the key, a double bonus! Have a great weekend!

I can understand why certain things in our tax structure have phaseouts, like who is eligible for the earned income credit and who is permitted to take what deductions, but the phase out for the Roth IRA simply doesn’t make much sense.

The general purpose of a phaseout is so that only a select few are able to take advantage of something because they are perceived to need the help. In the case of the earned income credit, it’s designed to help those with low incomes and so it makes sense that you must earn under a certain amount to qualify. In the case of some deductions, such as the mortgage deduction if your home is less than $1M, it makes perfect sense because folks who own multi-million dollar homes don’t need an extra hand with homeownership. If they did, they would’ve bought a more modest home.

But it’s the Roth IRA… it’s sole purpose is to give you some tax diversification by allowing you to save $4k a year and have it grow tax free. The money is taxed before it enters the IRA, so the rich get do not get a bigger benefit (in fact, they pay more for the benefit of a Roth IRA because their marginal tax rate is higher). Is the government saying that the rich don’t need tax free growth? The Roth IRA is only a better choice over a Traditional IRA if your marginal tax rate is higher when you’re retired - when is that more likely, when you’re making a lot of money now or when you’re making a more modest amount now? I’d say the latter but those in the former group don’t have a choice in contributing (or is the government protecting the rich from themselves? conspiracy!)

So why do you think is the reason or reasons why the phase out exists?

I’m not a fan of credit cards that offer promotional cash back offers because, let’s be honest, they charge their interchange and processing fees regardless of what their reward program is, so why not kick as much back to the cardholder in Month 1 as you would in Month 7 (or 13)? So, when Citi announced that the Citi Dividend Platinum Select Card would now be offering 5% cash back on purchases at gas stations, supermarkets, drugstores, convenience stores, and utilities for only 6 months, I thought that was a joke. I’m sorry, that particular Citi card is going to get a coveted share of wallet with a joke rate like that, especially since Citi just reduced the rewards from this 5% to the current 2% rate.

Listen Citi, you won’t get people applying for your card and putting it in their wallet if they only get 6 months. Make it permanent. Consumers, don’t get duped by these types of offers. Applying for new cards all the time, chasing a few measly percentage points on cashback is going to be brutal to your credit score. Find a card that won’t play these cashback games, apply for it, and stay loyal to it so the card companies know they can jerk people around by adjusting the rules as they see fit.

It’s clear that Citi regrets their decision to reduce the rate from 5% to 2% (otherwise why offer the promotion?) and it’s clear that they also enjoy the added revenue from not paying out as much (otherwise why make it 6 months and not permanent?), so don’t give them a reason to herald this offer a success by clamoring back for 3% extra for six months.