Devils in the details

Because the specifics matter. It’s one thing to say that Citi wasted some of the money taxpayers sent its way via the bailout; it’s another thing to say Citi wasted some of the taxpayers’ money by upholstering the pillows on the private jet Sandy Weill took to Mexico over Christmas vacation with Hermes scarves. It’s one thing to say Wall Street bankers felt pressure to chase profits; it’s another thing to say they achieved those profits by systematically robbing a whole generation of pensioners and working-class homeowners, under the noses of the politicians they bought with tens of millions in campaign contributions.

This from Matt Taibbi, at his True Slant blog, on Fareed Zakarias's defense of capitalism as it stands.

The devils (plural) are always in the details, but that doesn't matter to those who trump ideological frameworks as Bibles for how we should lead our lives. To some, the Market is an omnipresent, omniscient force of good will that works for the betterment of all. Really we know that not to be the case. Just as communism isn't a perfect idea, or Christianity still has some kinks to work out, capitalism - as a system - is just as flawed as the rest.

It may be the best way, but it's far from the perfect way. The chasing of money for the sake of greed alone is bound to produce criminals. Period.

To say the system is flawed is an understatement, and one that we keep uttering to make ourselves feel better when this kind of thing happens from time to time.

The road to self-improvement

Home sick today, after having my top two wisdom teeth pulled out. The experience wasn't a fun one (I nearly ripped the dentist chair's arms off during the procedure), but it had to be done. So this morning I woke up to a bloody pillow, a sour feeling in my stomach, and two less teeth. Joy.

But I did manage to attend my final Financial Peace University Class last night with Suzanne, ending a 13-week long session of self-discovery and budgeting education.

Suzanne's boss paid for her to take the class, and since you're supposed to take it with a spouse - and she didn't have one - she invited me to attend with her. I was pretty skeptical at first. I was thinking it was another one of those get-rich-quick schemes; you know, buying or selling crap, real estate scams, etc.

Now, however, I'm so glad Suzanne invited me. The class has been one of those experiences where you wonder how you ever got along with out it.

Not that I've ever had big problems financially. I've always been pretty responsible, especially since leaving school. Except when it comes to debt, in which case I thought everyone gets in debt while they're at school. Right? Who doesn't have a student loan or a credit card these days?

"The borrower is slave to the lender," Dave Ramsey says, a quote he took from the Bible. Ramsey is the one who instructs the class (via a DVD series we watched at a local breakfast place, every Tuesday night). If you haven't heard of Dave Ramsey (he's got a pretty popular radio show), I suggest you check him out. At times he can be arrogant and tough, but he knows what he's talking about.

His motive is simple: get out of debt so you can use the money you're currently paying to credit card companies to build actual wealth.

And use financial methods our grandparents used. Not so much a can filled with cash on top of the refrigerator (or in the freezer, as my grandpa used to do), but building an emergency fund for those sure-to-come events in life, or buying things with cash and bargaining when the situation fits.

The plan involves baby steps and debt snowballs and all kind of neat (but truly legitimate) tricks to get yourself out of debt. Just the other week I paid off a credit card I've had since college. I even over-paid, so they have to send me a check for the remaining balance. And I'm going to frame that check to document the first time a debt-causing business has ever owed me money. It's a pretty good feeling.

Next will come a few other credit cards I've had, then paying off my vehicle early, then my student loans, and so on. I like the thought of not owing anyone any money, and I really like the thought of the house I could buy with all those saved payments. Imagine what you could do if you didn't have any student loan or credit card payments. I've already started imagining.

The whole thing has been a blast. I've started selling a lot of my crap on eBay, and I'm doing pretty well. With the money I've raised, I can hammer away at my debts. The program also includes budgeting, which I've always strangely enjoyed, and I'm finding that I'm spending less and saving more. That may mean I'm the designated driver a few more nights a month, but I have plenty of fun with the money I have.

Last night we had a nice potluck and handed out "graduation" certificates, but the over-arching theme of the night was people breathing a collective sigh of relief. This stuff should be taught at the high school level, before the credit card companies get to you, but we were all glad we learned it now. Better late than never.

I've also met a few new friends, and found out that just about everyone has money problems of some sort. The trick is, as Dave says, to manage your money - not let it manage you.

So off I go. Ready to pay off another credit card probably by the new year, and then another, and then I can use all the money I was making payment with to make bigger payments on the stuff that's left. It's brilliant. And I can't wait to be debt-free.

Dave Ramsey encourages the class to take the knowledge and spread it to others (free of charge!). I think that I'll save up and buy my dad a spot in the next class, because I know he's never been great with money.

It's probably the best gift I could give him.

One for the money, two for the show

I collected my first freelance graphic design paycheck yesterday.

One of our vice presidents here at the credit union is starting a neighborhood association - near downtown Jackson - that will address property values, crime, security and such, and she wanted me to design a flyer/invite to send to all the residents.

"I'll pay you," she said.

Well, how about that?

She gave me the details - who, what, when, where, why - and said she wanted an "urban" yet "classic Jackson" feel to it. That was all. The rest was up to me.

Luckily my new digital camera came in last week, giving me the first real opportunity to use it. I took it to each of the neighborhood's four street corners and took shots of the street signs, then used them on the flyer.

She was pleased. There was a bit of tweaking, but she liked the finished product.

Then came the "billing." I'm a rookie at this type of thing; how much is my time and effort really worth on the market? When I worked for Jackson Magazine they gave me a flat rate for each story. But here I could charge for my time or a flat rate for the whole project.

I ended up doing a bit of both. I figured, since this was a non-profit, organization-type group, maybe $10 an hour would be okay (figuring that, if I ever got corporate projects, I would charge them double - which is still a deal, I think). So I downloaded a neat little time-clock application that automatically made an invoice as you worked on your project.

I guess you could call me a "small business person." Small as in "$20 and one project" small.

That's what I charged her - $20. I spent about two and a half hours on the flyer, but I shaved the last half hour. What can I say? I just like doing the work.

She even came up to me after and said her mom really liked it, and might commission me for more projects.

Dave Lawrence - open for business?

I've toyed with the idea of doing freelance stuff on the side. I always thought it would be cool to design local bands' concert posters, or do flyers for non-profit groups in town (usually because they look so eye-scratchingly awful). This is a good start.

But now I have to think of a name for my new little enterprise. And a logo. Maybe some letterhead and a business card.

I'll need an intern, of course, and an administrative assistant. Maybe a CFO.

Now taking applications...

Money: it's a gas

"Most don't know enough about money" ran the headline in last night's paper.

More and more articles, I've noticed, have focused on people's inability to save - and how they are falling deeper into debt. The national savings rate has been in the red for months now.

And hey, with so many credit card and home equity options out there, not to mention an insane consumer-driven market, it's no wonder more and more people are going in to debt.

More than 2 million people. That's how many bankruptcies last year.

The tips for saving, I've been reading, include putting just a little bit away out of each paycheck, keeping a budget, tracking where your money goes, and paying off the bigger credit card debts as soon as possible. Also, avoiding those little Starbucks trips every day can save quite a bit over time (I always think about smokers when this tip crops up).

Also, with the instability of Social Security, the alarm has been sounded about retirement savings - especially with our generation.

I like to think of myself as a savings success story. I remember college, and how much I used my Associates Student Visa card. I paid tuition with student loans. I worked, sure, but it wasn't enough. I survived on debt.

And now most of that debt is with me today. But the difference is now I have money in the bank (sorry - credit union).

Out of each weekly paycheck, I send $100 into my savings, $10 into a Christmas Club (greatest invention ever) and $10 into a Vacation Club, with an extra $25 going into a second savings account that helps me pay off my credit cards.

I also deposit into my 401(k) every week. In fact, I switched to a no-payment health insurance plan and put the money I saved into my retirement account.

I'm lucky. No one really taught me how to do this - it just seemed to make sense to me. I remember feeling so insecure financially in school that I resolved never to feel that way again. And it's worked.

Lately, though, it's come into even sharper focus. I've started to use the Quicken software on my iMac to track my ins and outs. At the end of each month, it gives me two charts: income (yellow) and outgoing (blue). Basically, am I making more money than I'm spending? In the three months that I've tracked, two of the yellow graph bars are bigger than the blue one. So I'm two-and-one since January.

It's taught me to think about purchases before I enter that PIN number, or click "checkout" on a web site. Do I really need this? Can I live without it?

It used to be I could never say no. I felt like I was fueling the retail economy on my own, thanks to my credit card. I think Driver told me I was "a great consumer."

Now my credit cards are in hiding, and only come out when I need to make a giant purchase (my iBook, say) or fix my car. That feels good.

No, that feels better. It's the security I'm after, and in some ways I've achieved it.

I don't know about advice. I still have relapse moments. I usually don't spend any money during the week, but then blow a bunch on weekends (bars, trips, friends, etc.). And - in the middle of all this - I'm taking a huge trip in May that will virtually wipe out my savings.

Sometimes, though, I like to treat myself. I think I've earned it.

I've found that saving even just a bit each week adds up pretty quickly. Save $25 a week, and that equals about $100 a month, which equals about $1,200 a year. You save $1,200 a year and you'll be sitting pretty good. Better than the national average, certainly.

Money - it's a gas. But I'm learning how to keep it all from blowing away.

Now off to eBay...