2

What’s so wrong with saving money?

I’m reading a Newsweek article entitled “Stop Saving Now!” It’s overall message, if you couldn’t guess from the title, is that in order from our economy to recover we – as a society – need to start taking more risks and throwing our fiscal caution to the wind.

This brings to mind a time when I received an allowance and I had a choice to save the money or spend it. My parents would advise to save it so I could buy something bigger than what I could with just a few dollars. At that point, there was no risk in not receiving more allowance, but nonetheless the general principle was that risk-free “saving is good.”

It almost makes me ill to think that our entire economy revolves around – well – greed and bad decision making. Not that penny pinching is the way to go, but when an article compares our entire society to Las Vegas casinos (where gambling revenue is down — in January, Nevada’s casinos reported, gamblers lost 14.6 percent less money than they did in January 2008, notes the article), I start to get a bit queasy. Why should we be expected to live our lives with such high risk in order for our economy to work? Isn’t there something wrong with that equation?

“It’s tempting in this period of contraction to mimic Thoreau, to live simply and deliberately. But if we lose our penchant for gain and risk, we’ll lose some of the essence of what makes us American.”

5

Loans Between Friends – Not Always a Good Idea

Have you ever lent money to a friend or relative? In times of economic hardship, more and more often our friends come to us with a request to borrow funds. Or maybe we are at a loss and need a few bucks to get by for the month, and we ask a friends to spot us the dough.

The New York Times reports that it’s best to stop and think before lending money to anyone, even a good friend. The article highlights a professional financial planner who ended up lending her manicurist(!!!) $3000. Her manicurist needed the money to avoid eviction, and tugged on the emotions of a woman who would otherwise advise clients not to lend money to personal acquaintances.

For me, I like to lend money to people in need, but not to my close friends. Instead, I use Prosper’s P2P lending system. At least I can do a credit check on the person before deciding to lend them money, and I can earn a decent amount of interest back in return. (Then again, it looks like it will be a while before I can lend on Prosper due to some legal trouble they’re in.) If I were every to lend money to a close friend, I’d have to think of it as a gift when I part with the funds. If I get it back, all the better.

Q & you A:

What’s the most you’ve ever lent a friend? Did you get that money back, or did it ruin your friendship?

1

The Accidental Breadwinner: Some Women Have Their $hit Together

Thanks to The World of Wealth for pointing me to this fascinating NY Times article called The Accidental Breadwinner.”

Writer Karen Karbo details her three marriages, her long-ago dream to be taken care of by her breadwinner husband, and the reality of her making most of the dough in each of her marriages. She writes how a friend, whose husband made enough money to give her time off for a few years to “figure out her life” ended up with a cheating husband, stuck in a marriage in fear of now having enough money to live the life she’s become accustomed to.

Karbo poses the question, “Is it better for the longevity of a marriage if one party (usually the woman) feels financially trapped?”

Well, yes. Marriage, just like any other business relationship, tends to survive longer the more complicated it is to get out of. But that isn’t the kind of marriage I want to be in. Does it really take three marriages to get it right? Karbo sounds like she’s found happiness now, with split incomes and an unromantic agreement on who pays for what (including who pays for who’s kids.)

As I’ve written before, I’m worried about my current relationship because I’m the half of the duo motivated by money. That means my dreams of being the woman who works part time and takes care of the kids while my hubby brings home the bacon are all but dashed. Those dreams aren’t real anyway, but they certainly are, in the back of my mind, what I expected. That’s what happened to my mom. She went to school for fashion design and worked in the industry for 10 years, only to quit when I was born and become a housewife. And she’s always been afraid to leave my father because, like Karbo’s friend, she doesn’t want to also leave the life she’s grown accustomed to. The money she’s used to spending. Even if she did get a job, she’d likely be earning minimum wage. At 50 something years old, how many raises can one expect before retirement age approaches?

I refuse to get stuck in a marriage that’s destined for a situation like that. I’d rather be the breadwinner, accidental or predetermined. Still, my dream is a marriage where both parties bring in a sizable amount of income. My aunt and uncle are prime examples of that type of couple. The husband owns a one-man marketing firm, stays home, takes care of the kids, and still takes in six figures. The wife works as a marketing exec for a magazine, and also takes in six figures. Together, they own a nice house in a really nice neighborhood. That’s the kind of life I dream of. I can only hope that Mr. Sweetheart will realize that asking for raises is an expected and acceptable part of being in the workforce.