order to start this little essay, I need to establish a foundation.
We’re going to go shopping… with a child.
you’ve ever been around a child with money, you probably know
the drill -- they believe ten dollars will buy the world. It’s
an honest mistake… especially when we are talking about the ages
of 4, 6, 8, and such.
dollars might be a video game… used or discounted or if nothing
else at least suitably entertaining for kids.
dollars might be a toy.
dollars might be a movie… a hat… a stuffed animal… a puppy!
Ten dollars might be a puppy!
as adults we shake our heads and smile. Because even if that ten
dollars could be a puppy, the reality is it won’t be a video game
AND a toy AND a movie AND a hat AND a stuffed animal AND a puppy.
will be one of those things.
then it will be spent.
would argue it’s not that children don’t understand the value
of money (although I readily admit that is part of it). Instead,
I think the major portion of it is that they don’t understand
the permanence of spending money. In other words…
only get to spend that ten dollars once.
we can discuss and debate and consider the ideas of saving money,
investing for the future, making wise purchases with thorough
research, and any other concept you want… the idea I’m trying
to establish for us and this essay is simple -- when money leaves
your wallet for a purchase, you don’t get that money back.
now we can move one step further up the ladder.)
years ago… and I do mean ten-plus years ago… I made a fancy observation
about finances. Well, maybe it wasn’t that fancy. But it was,
I thought, a really good observation. I’m going to make it again
here… with a slightly different example…
you want to stop the school bake sales? I may not agree with you
-- at all -- but I understand what you are saying. Some kids have
allergies… and good lord we can’t have our children buying cupcakes
and eating unhealthy snacks. Stop the bake sales! Got it.
then… the money raised with those bake sales might have been used
to pay for uniforms for school’s athletic teams… might have been
used to support field trips… purchased new equipment… supported
the yearbook… and so on.
more bake sales.
are you planning to pay the costs that once were covered?
reaction. That’s the result of my fancy observation. No bake sales…
need to bridge the revenue loss.
get me wrong folks. I’m not telling you to have the bake sale.
That isn’t a must for me. I’m just saying that, in my opinion,
if you want to be active and vocal about the need to get rid of
the bake sale then you need to be accountable and responsible
for what comes next.
will be no banning brownies and then complaining when your child
needs an additional $10 to go on the annual trip to the local
along to the next rung.)
article from Carl Richards. (Link from the finance area
of yahoo.com, no longer active.)
about saving money and investing and… well, it uses that great
old example of giving a penny on day one and doubling it every
day for a month and ultimately realizing amazing results.
I like it. There’s some good, solid advice in there. And it isn’t
presented in some amazingly complex or totally out-of-touch way.
me give you a real example: Say you have Sarah, who decides
at 25 to save $1,000 a month. She does that for 10 years.”
now, with that line, we’ve completed the foundation and reached
the top of the ladder. I can begin the story about how difficult
this economic recovery is, and why so many people seem lost about
what is going on.)
me give you a real example. (Because, frankly, I don’t
know many people that have the resources to save $1,000 a month.
Great in theory though. That said, this is an example. It is meant
to portray a situation we can all picture, and does not reflect
one specific family. Ok? Good…)
years ago, a family with a fairly low income liked to gather everyone
together each night at the dinner table. (I know… I promised a
real example… just stay with me.)
It’s a family of four. Mother. Father. Two kids.
every Friday, they order a special take out dinner as a treat,
rent a movie, and settle in to spend some time together.
times change. The company where mom and dad work have started
taking $5 extra each week out of one of the paychecks to cover
the medical benefits.
nine years ago, the family adjusted Friday night. Gone was the
full meal with breadsticks or extra egg rolls, and in was a pizza.
times change. The cost of cheese and other ingredients go up,
and a large pizza from that great place down the street is no
eight years ago, the family adjusted Friday night. They still
order the pizza, but they couldn’t rent a movie and had to cut
back on their cable package, so they began a family game night.
the family is getting bills from the routine doctor visits. (Nothing
amazing folks. Just basic annual visits for mom and dad and the
kids. There are co-pays that are going up… and changing costs
of medication… and some procedures are no longer covered on an
price of gas has skyrocketed. Which in turn not only means more
dollars for running the car, but also an increase in the costs
of heating the house.
are no annual raises at work… the cost of living doesn’t care.
same family of four is no longer gathering once a week for a little
treat while setting up a quiet and fun evening together. Instead,
mom and dad are trying to figure out how to pay the mortgage,
send a check for the bill for their portion of a tonsillectomy
or colonoscopy, and put oil in the tank before January arrives.
this point in our story, we look at the media. They are offering
up some coverage of a comedian, in prime time, that says to the
audience something like this (my words, but you all can recall
this): “To get through these difficult financial pressures, all
of us need to pull together and make some sacrifices.”
course, I don’t believe “comedian” is the technical term for that
person asking us to get ready and expect tough decisions and sacrifice.
Officially, I think the person was called a candidate.
little problem is easy to spot… especially if you read my real
example and nodded about how costs have been rising in all areas
for our real family. And that is -- most people don’t have much
left to sacrifice. By the point this comedian is relaying the
“news” that we all need to make some tough decisions, most of
us have already made tough decisions and sacrificed.
look at the foundation I was creating. (Remember the foundation?)
have ten dollars in your wallet. You spend ten dollars on something.
You no longer have ten dollars in your wallet.
people in this country aren’t looking to trim unnecessary expenses.
They’re debating which credit card bill is the most important
one to pay because they can’t send legitimate checks out for all
of their necessary household expenses.
won’t pretend to know all parts of the Affordable Care Act. There
are likely some previsions in it that I’m missing. But let’s move
along to the bake sale part of my progression… you know, now that
we’ve established that no one has any money to spend.
government is requiring companies to provide medical benefits
to employees or pay a fine. (Yes, there are provisions for small
businesses… but we’ll just keep moving along as if the business
in question is required to provide those benefits.) As I understand
it, there are two conditions involved…
If not providing medical benefits, the company would be subject
to a fine of $2,000 per employee.
The employee in question must work an average of 30-hours or
more each week.
let’s get the funny thing right out of the way. According to most
estimates I’ve seen, the average annual cost to an employer for
providing medical benefits is -- any guesses? -- more than $5,000.
Not that this is going to happen, but let’s go to the ridiculous
extreme -- as an employer, what would you rather pay… $5,000-plus
per employee or $2,000 per employee?
So now you see where it can be absurd. The less funny thing… many
companies are already adjusting the scheduling of their employees
to -- yeah, you got it -- less than 30-hours per week.
on… hold on… you mean now we’re headed toward a destination where
many people are not only being asked to sacrifice well after their
ten dollars was taken, but might have to do it on 75% of their
paycheck? If you think that’s mind-numbingly hysterical, get ready,
because it gets even better. You could be held accountable for
not having medical benefits and be forced to pay for them or pay
a fine. (Not a tax. No, of course not a tax. It’s a fine.)
And, you may have noticed that without raising taxes… the comedians
promised we average folks wouldn’t have our taxes raised… our
paychecks have already gone down by roughly 2% in 2013.)
know what this reminds me of?
juggler is performing. He’s blindfolded. But the audience wants
more. So he’s blindfolded and juggling three running chainsaws.
Audience wants more. So he’s placed on a tightrope 50-feet in
the air. More. So two more chainsaws are tossed into the routine,
and the tightrope is set on fire.
most Americans have adjusted their lifestyles and made difficult
changes, we’re given the speech that sacrifices need to be made.
And because we dared laugh in disbelief, the prices of gas and
groceries rose, medical benefits are threatened, and paychecks
cut. Basically, I hope we can all handle adding the chainsaws
into our routine… because it wasn’t enough for us all to be blindfolded
and 50-feet in the air. (Fortunately… we all have medical coverage.)
don’t have any answers. Maybe this is just a rant. Perhaps just
an attempt at opening eyes (and an attempt that some may have
stopped reading several hundred words ago). Perhaps this is a
good way to turn this observational essay toward a conclusion.
places I looked at said that college tuition rose by roughly 6%
about four or five years ago. Most places told me that the average
college graduate in 2010 had roughly $27,000 in debt just from
tuition bills and loans. And, most places I found said that unemployment
for college graduates has never been worse.
does that mean?
if you are graduating from college today, chances are very good
that you don’t have a house or anything else tangible, but you
owe more than your parents have ever paid for a car… good luck
finding a job in your field, never mind finding a job at all…
and, the costs of that education, for those of you with kids that
haven’t reached college age yet, is growing faster than your paycheck.
remember the paycheck, right? The one that isn’t getting an raise
and has dropped in 2013 and just might be sliced by about 10-hours
a week? That one.
not trying to be funny here. Well… in parts I am. But I’m also
trying not to be naïve. What I am trying to say is that there
is a disconnect here.
politicians are posing and debating and talking about sacrifice…
and while they taunt and twirl and spin stories of their heroic
activities… and, more accurately, while they watch polls and try
to gauge results or factor in how opinions may change because
of their actions before they do anything… I think the only conclusion
is to say they do not get it. Not at all.
media is covering stories about a coin that could be valued at
one trillion dollars. We’re being given details about ways this
presidency will finish its run and leave its legacy. We’ve been
told that if you turn the prism of unemployment or cost of living
or whatever to just the right angle there’s a rainbow to be seen.
I like rainbows. I also like lollipops and puppies. I can’t get
any of those into the envelope when I pay my bills.
a light at the end of this tunnel. And while some people are looking
at rainbows, hopefully a few people in positions to do something
about it will recognize it just might be a train.