Well, the GRE is over and done with, and I have to say, the studying and the prep course paid off. Sorry for the absence—it's been a very full few days. I'm a little loopy with freedom, and busily planning social outings and recreational spending. I've got a bunch of stuff to catch up on, and may be draining my emergency fund (temporarily!)—updates are to come!
Friday, July 27, 2007
So much like in my last post, all the good advice I received here ended up being moot—my employer added my freelance income to my regular paycheck and withheld 401(k) contribution and taxes from it. I guess I'm glad to have the extra 401(k) contribution, but to see my $335-ish check dwindle to $205 (for a month and a half's work) is a little...well, pathetic. It's enough to make a girl want to pad her invoice!
And doesn't that withholding seem a little excessive? If you subtract the 401(k) (less than $25), it ends up looking like I'm in a 33+% tax bracket, which, I assure you, I am not. Maybe they're doing this to cover the self-employment tax? Or maybe I'm just going to get a big fat tax refund...which is fine, I mean, I'm not opposed to that (interest-free loan blah blah notwithstanding) but I do actually need the money to cover my grad school applications, so I'm sort of thinking of taking an extra exemption.
Anyway, I'm opening an Electric Orange checking account for this money, which seems the best of both worlds—interest and easy access. I don't want to have to scoot this money around too much (it's too slow and annoying), and since I know I'm going to be spending it, it seems expedient to slap it into an account with a debit card, so I can charge related expenses directly to it. I've already spent $140 of the $200 on the GRE registration fee, anyway.
Wednesday, July 25, 2007
Thanks for all of the advice you gave on the last post, guys--I really appreciate it. Unfortunately, the issue is moot, as I didn't get a second interview. It sucks not to be good enough at something to do something wonderful that you want to do (and to not know what the something is). Anyway, the point on lining up references for the future, in particular, is well taken.
Tuesday, July 24, 2007
So, I went on an interview yesterday afternoon--a big group interview at one of the places I volunteer. I love this organization, and I want the job on offer badly. I'd gladly put off grad school for a few years to do this job. I want this job. Are we clear on that? Good.
Now, I haven't actually heard yet whether I'll be getting a second interview or not, but if I am, I'll need to bring with me three references, at least two of which should be professional. The problem, of course, is that no one at my current company knows I went on this interview, for obvious reasons.
Theoretically, I could approach the editor with whom I work most closely and say, "Look, I'm not interviewing around--I'm just interested in this one organization, and if I don't get this job I'm not going to go on any other interviews. Can you recommend me?" The problem, of course, is that if I don't get this job I'm proceeding with grad school applications, and I feel like it's disingenuous.
But my other options are limited:
My boss from my art magazine internship, the one who loved me? Gone. I could try to track her down, but it might or might not work.
My boss from the public relations office at school? Gone. She's definitely not trackable. I could ask, instead, the director of alumni relations, who asked me to write a couple of pieces for the alumni magazine, but I didn't generally work closely with him.
My work on a major student event? Didn't have a "boss"--it was run by a student committee. I could give them the name of a friend who worked on the committee, who would happily tell them about how hard I worked despite having emergency surgery during the run-up to the event, but she's my age and I wonder about how much credence they'd give her recommendation.
And it seems bizarre to omit my current job, which has gotten so much more of my energy and effort than any previous employment. I could theoretically ask someone with whom I don't work as closely and in whom I feel comfortable confiding, but I'm not convinced that will carry the same weight.
I don't really know what to do here. My only hope is that I'm reasonably well-known to the organization from my volunteer work (like, I'd met all of the staff members in the room yesterday), and if I explain the situation, they may waive the requirement.
Monday, July 23, 2007
I blew it on my Friday evening out, where "it" equals $55 (well, okay, $15 of that was covering a friend's drinks, and she'll pay me back, though probably in drinks).
I did fine on the food. It was the booze. Need I say more? (If so, I will invoke a magical pair of words: frozen margaritas.)
But it was a really lovely evening. I got some grad school advice from a friend who just finished a one-year Masters and is starting his (philosophy) PhD in the fall: we talked housing, stipends, and the GRE. And in a particularly lovely surprise, a friend dropped in whom I wasn't expecting to see for another full calendar year--she's in the Peace Corps in Swaziland, but home to attend to her mother's illness. That's a sad reason to get a chance to see her, but I was glad nonetheless that I could.
We pooled our knowledge about an absent friend's relationship status (conclusion: he and his lovely girlfriend are no longer together). The academics, Peace Corps member & workin' folks razzed our doctor- and lawyer-to-be about having to pay for our dinners in future. The law student promised that if she gets a firm job, she'll buy dinner for everyone. The med student told us about his first cadaver. K showed up late in the evening, and it warmed the cockles of my little heart to see how well he gets along with all my friends. They were psyched to see him, and there was a point at which he was explaining his volunteer work and pulling the big fat biography he's reading out of his bag to get to his computer and show us the graphic he made at work--I all but swooned.
I had a cigarette out on Amsterdam with the Peace Corps friend--she said she has to drive her mom to the hospital to see her doctor, because her mom can't drive herself. It's not the entree prices--this is how you know we're growing up.
Bottom line: I can cover the cost, and I had a great time, so it's no big deal to do this every now and again (though it would help if I were more realistic in my cost projections: I need to know that I'm not going to end the evening having spent under $20). Sure, I could have--and would have liked to have--saved another $25 this pay period, but how often do I get a chance to sit down with this great bunch of kids? Not that often. Once or twice a year--though this time, it looked like everyone was going to be in town for awhile, so we may do it again in just a couple of weeks.
Don't worry: we agreed on a cheaper restaurant for next time.
Thursday, July 19, 2007
Tomorrow night, I'm getting together with a few high school friends--a bunch of great kids I've known since I was 12 or 13 and whom I really enjoy. We're all very far-flung at the moment: one is a Gates Fellow at Oxford, another a law student in Boston, another in med school (I forget where, but not New York)--then there are two of us who have entry-level jobs here in the city.
It was the law student who picked the restaurant, and she picked a $25-for-an-entree place on the Upper West side. Imagine if you wanted to get a drink! Or dessert! I'm straining my budget by going out at all, so this kind of place is pretty thoroughly outside my means. (I wrote her an email to say that it was a little expensive for me, but if it suited everyone else, I'd work around it--and I will, by eating home first and getting something small and inexpensive out.)
Is this how we can tell we're growing up, by the increasing prices of our entrees?
Wednesday, July 18, 2007
ISPF writes something that rings very true to me--she's talking about the idea of "cycles" of frugality. She does a very nice little graphic of what one could call a "frugality wave"--it's like a sine curve, where the line is one's actual expenditure and the x-axis is one's average expenditure. I feel like I've been in a high, even extreme section of the frugality cycle recently, saving more than 25% of my take-home pay, and now I find myself chafing a little, wanting a little more room, a little more income of which to dispose towards pleasurable ends.
Here's the reason this doesn't worry me: like ISPF, I cycle within a fairly narrow range--for me, the amplitude is no more than $100 or so. I'm never not saving anything at all (we're talking cash here, not retirement--obviously, because that's a paycheck deduction), and I'm certainly never spending more than I make. I also don't think the high point of my spending is excessive, though I may have to keep an eye on that end if the pattern remains the same and my salary increases.
For the moment, though, I'm happy to look at this the way ISPF does: it's just a natural fluctuation, and as long as the extremes aren't too extreme, it's nothing to worry about.
Tuesday, July 17, 2007
K's sister got married in April, and in September, K's brother is following suit (dear readers, do not begin holding your breath for a third K Family wedding announcement). K's parents have just very generously offered to pay for our tickets to Oklahoma City and our hotel room while we're there. I will still need a dress, and probably new shoes as well. This means that I have to stop pouring the money I usually allocate to that sort of thing into savings, which I've been happily doing for the past couple of months.
On the one hand, I'm disappointed; I enjoyed the momentum I was achieving, and I had begun inching my savings goal (originally $4,500 but recently revised up to $5,000) towards $5,500, and I may not be able to hit that if I start spending money on clothes again. On the other hand, I've been sort of pressing the proverbial pedal to the proverbial metal, and I'm starting to get itchy to have a little more (proverbial?) wiggle room, especially as I eagerly anticipate having a social life again within two weeks (GRE on the 30th!). And obviously, the damage is a lot less than it would have been had K's parents not been inclined to be so generous. So I think I'll try to carry through on my July goals for this next paycheck, but after that I'll scale back, chill out a bit, and start thinking about shoes (I've already got a dress mentally picked out).
Monday, July 16, 2007
Seriously, you guys, I'm never buying roast beef from a deli counter again.
I made a roast last night! Roast beef from a deli counter or pre-packaged costs what, six bucks a pound? Roasting your own costs maybe half that. Last night, I bought a 4.1-lb. rump roast for less than $13, and after getting it home and doing a little internets research, discovered that although it sounds intimidating, cooking a roast is really, really easy. If you're not going to get fancy with rubs and marinades (which I wasn't about to), it goes like this: take roast out of packaging, whomp in baking pan fat side up (so it self-bastes), stud with garlic slivers, rub with olive oil and salt, stick in oven. Three hours or so of idleness later, you're done! The only downside is that you don't get thin, even slices off a roast unless you're a really brilliant carver, which I'm not. Still, I think the savings is worth it.
I was contacted a few weeks ago to be interviewed for this article. The author wanted to use my real name but not mention the blog, so she wouldn't be "outing" me. I wasn't up for having information about my finances--especially about an issue that inspires as much intergenerational and class-related strife as this "getting money from your parents" thing does--tied to my name, searchable by employers and the rest of the world on the internet. Given how busy I've been, I lost track of the whole thing and fell out of touch with the author, but reading the article, I'm glad I didn't agree to be interviewed. With one exception, I think there's a sense that these kids just don't know how to sacrifice, that they're draining their parents' retirement accounts because they can't get it together.
This is not the case with the money I accept from my parents--it is a drop in the bucket to them, and an extremely substantial amount to me. Moreover, it's not money that goes to cover necessities for me--I live on what I make (in fact, I live on substantially less than I make), and the money I accept from my parents is used as extra savings, a way of ensuring that I can get the most out of the financial opportunities of youth.
I'm not saying I might not have been another exception in the article, but still, I think I made the right call.
Thursday, July 12, 2007
If there is one thing I know, it is how to live cheap in New York--especially in the summer, which, as it happens, is when most tourists visit New York. So we can call this frugal New York tourism, but if you're a native, don't be shy about picking something up (or about correcting me!).
So here's the first tip: Shakespeare in the Park!
The Public Theater puts up two plays a year at the Delacorte Theater (enter at 79th on the East Side or 81st on the West--the latter is easier), and tickets are free, with one caveat: you have to wait in line to get them. Tickets are distributed at 1 PM, but you need to be there way before that, so you'll spend a chunk of time sitting in line.
This one's pretty well-known by New Yorkers, but plenty of people don't know how it really needs to be done.
There's a very, very easy way of determining when you need to arrive to get tickets: go by at noon on a comparable day (i.e. a weekend if you want to go on a weekend, the day before if you want to go on a weekday) and ask people when they arrived. Do not ask the first person in line; he/she will almost always say something ridiculous like, "Well, I got here at three a.m. and waited on Central Park West until five when the park police wouldn't shoo me away..." No. Don't go there. Ask someone at a reasonable place in line, 50-200 people back (depending on how intent you are on good seats), and take their answer as your arrival time. (Last Sunday, a friend and K and I had to show up at ten to six--yes, A.M.!)
Pack food. There's a deli that will deliver to the line, but they're slow, inefficient, and, you know, not the cheapest option around. I'd recommend bringing a sandwich (or alternate actual meal item), some easily packable snacks that don't need to be super-cold, a thermos of iced coffee (or whatever you prefer), and a bottle of water (freeze it overnight for a combination cold drink/ice pack). Even for those of you who don't have home refrigerators in New York, stocking up at a grocery store will prove cheaper and more convenient than ordering.
Also bring: sunscreen, sunglasses, a blanket (a cushion to sit on would be nice, too--you don't usually get the grassiest of spots), and entertainment (a book works, but a board game is even better).
At nine or ten, Delacorte employees will tell you to go home if you have no chance of getting tickets, but if you time your arrival properly, this shouldn't be an issue. Instead, they'll tell you that your chances are good, that you can't leave the line (hence the importance of the packing!), and that you can request two tickets for every one person on line.
You get your free tickets, you go home to nap, and you return at 7:30 for an 8:00 show.
The last performance of Romeo and Juliet was Sunday (and I'm so glad I caught it). A Midsummer Night's Dream runs August 7 to September 9, and I encourage you to go. It's a fun, frugal, and characteristically New York way to spend a day.
Wednesday, July 11, 2007
In my recent frugal food efforts, one thing I have found to be consistently true: chicken thighs are a better buy than chicken breasts. Breasts are drier and more expensive. People buy them because they're an easy shape to deal with and because they're slightly lower in fat--but really, the difference is a very slight one, and the thighs' flavor is the better for the little bit of extra fat (also, it can mean that the same amount of food is more filling). You can trim off the visible fat if it bothers you, but mostly it cooks off easily, leaving behind tender, juicy meat for less money.
Check out this easy recipe from Apartment Therapy's The Kitchen for a way to dip your toes into the wonderful world of chicken thighs.
Tuesday, July 10, 2007
So, I'm shortly to get my first check for freelance work. It's going to be in the neighborhood of $350. As I've mentioned, I'm earmarking the money from this job to pay for my grad school application process, but what do I do about taxes? I've done a little light research, but most of the stuff I've found seems to be targeted towards people like K, who are full-time independent contractors, not people who have W-2 jobs but earn side income on a a freelance basis. Do I need to do quarterly estimated payments? Will I need to pay the self-employment tax? Should I bother setting aside money for taxes, or should I just assume that because the amounts are small, my W-2 withholding will cover my entire tax bill?
I know lots of my readers have additional freelance income. Any resources you can point out or personal experience you can share would be greatly appreciated.
I have a friend (no, this is not a "Doctor, my friend has an itch" situation), a smart, ambitious, beautiful, Ivy-educated friend, who is going about her retirement planning in a highly unusual manner. My friend has a solid job, at which she makes somewhere in the low 40s. She plans to pursue graduate study. She likes living well, but has no illusions that her preferred field will provide for her lavishly--it should provide for her well, especially since she's good at it, but it's not hedge funds.
Also, she is having an affair with an extremely wealthy older executive. From whom she receives money on a monthly basis. A large amount of money. She doesn't use this money to buy designer clothes, or eat out daily, or get regular facials. She invests it. We haven't talked about the details of her investment, but her expectation is that this money will provide for her in retirement and perhaps contribute to the endowment of a not-for-profit she hopes to start. If she continues to receive this amount of money on a monthly basis for, say, two years, invests it, and sits on it until her mid-60s, she'll have something in the neighborhood of 7.5 million dollars, less taxes (her investments are in taxable accounts). And that, indeed, seems to be her plan. This means that she'll never have to save for retirement out of her salary, and she'll still end up with quite a lavish savings.
Aside from the tax consequences--Is someone paying gift tax? I would think investing money of indeterminate provenance would be a big fat red AUDIT! flag--I kind of think this is brilliant. I'm jealous of the incredible speed with which her investments grow. That sounds way better than my slow and methodical plodding.
I know that there are emotional consequences to these kinds of arrangements, and that some people (including some of my friends) find the whole situation sketchy, and not without reason, but I think it's hard to deny that my friend is being extremely smart here.
Madame X recently did a post on personal finance for mobsters. I'm intrigued by the way these unusual situations lead to unusual financial planning--I think it's another case in which talking about money is a way of talking about people. Any other tales of "extenuating circumstances" finance?
Monday, July 09, 2007
Mapgirl tagged me, so here are eight things you may not have known about your humble blogger.
1. I follow the Casey Serin saga with the enthusiasm of a housewife watching her stories.
2. My favorite Shakespeare is Twelfth Night. I find it extremely strange and kind of creepy, which is part of why I like it so much. I wrote a paper in college about how it subverts genre expectation--a lot of people think it's sort of the epitome of the Shakespearean marriage comedy, but I think they're entirely wrong.
3. The only thing James Joyce ever wrote that I have not read is Finnegans Wake, and I have no plans to rectify this omission.
4. Sometimes I eat sorbet for breakfast and pretend it's fruit.
5. I drink enormous amounts of seltzer. When I was a kid, my parents used to get crates of it delivered in those glass bottles with the carbonating tops, like clowns squirt in old movies. Now I'm hooked.
6. I hate humidity.
7. I smoke the occasional cigarette: about one pack every two weeks.
8. I cry just thinking about the final montage of Six Feet Under. Seriously.
No pressure, but if I were to tag folks, they'd be s/100/30, the Bizarros, gradgirl, and Wanda.
Friday, July 06, 2007
Two interesting articles today, both for people just starting their financial lives.
1. Put Your Finances On Autopilot, from Kiplinger's excellent Starting Out Center, is a primer on ways to start out on (or readjust to) the right financial foot easily and painlessly. I'm going to send this one to a friend who graduated a month ago and yesterday asked me for advice about managing her money. I continue to be surprised by the number of people who aren't aware of the number of simple and easy options available for money management in the pragmatic, daily sense, especially with the glories of the internets all around us.
2. Popular Advice You Shouldn't Take, from the Wall Street Journal's "Getting Going" column, is more controversial. Much of the advice is sensible (buy a moderately sized house, don't be suckered into buying cash value life insurance, and start out investing at your comfort level), but the author also argues against accruing an emergency fund. He argues that we can borrow in the event of emergency (he advocates plastic and/or 401(k) loans) and that our money can work harder in 401(k)s and Roth IRAs. While it's certainly true that the interest rate on liquid cash in even the highest high-yield savings account isn't competitive with what you earn in a tax-sheltered mutual fund, I still believe in the value of a cash reserve (and am leery of the wisdom of borrowing in an emergency--isn't it a little like being kicked when you're down?).
I used to feel very differently. Given my youth, health, employability, and total lack of dependents, I thought, who needs a big emergency fund? Here's the thing, though: I do not have a set plan for my life. If I knew that I were going to continue working at this job, advance, get married, buy a house, and have kids, well, I might be bumping up my retirement contributions and saving for a down payment right about now. But for me, and I think for a lot of young people, money is the power to make choices based on what I want to do and where I want my life to go rather than on where next month's rent is going to come from. I think I'll have more freedom with $10,000 in the bank, and I think having freedom is completely crucial at this stage of life.
Tuesday, July 03, 2007
Overheard in my office:
"I'm living the American Dream: I'm living beyond my means!"
The speaker was joking, but it still spazzed me out. She and another office friend and I were talking about credit card debt--she made fun of me for my tendency to pay off individual charges on my card right after I make them (admittedly, this is overkill), and we made fun of her for her contention that paying something on her debt every two weeks means she doesn't pay any finance charges (they have to issue another statement, she says, which prevents interest from accruing--that can't possibly be true, right?).
This is all in good humor, and I would never seriously try to preach to her about financial responsibility. It's just not my place, and clearly, she's not in a place to start thinking about that right now. And you know, I guess that's fine: people come to things when they're ready, and she's not.
I think our mutual teasing conveys a kind of mutual respect, somehow, and that does seem to me to have something to do with the American Dream.
Monday, July 02, 2007
My June net worth is up at NetWorthIQ--it's $17,234, an increase of 7.41%. There's a big fat asterisk next to this one, though, for one important reason: I currently have two months' worth of rent, rather than the usual one, sitting in my checking account right now, waiting for my check to clear my landlords' accounts. They never sent us an invoice for last month, and we finally got a bill right before this month was due, so we just sent them in together. So this number is inflated by about $630, which is about half of the increase. I'll probably be flat on July's net worth for this reason. Even without that deceptive number, though, I did okay--I'm hoping that I may crack the $20,000 mark by the end of the year, and this month starts to make that look possible.