This blog contains some simple tips and advice from two regular guys. We're not accountants, financial advisors, or brokers, so follow, ignore, or discuss our ideas as you see fit.

Saturday, February 26, 2011

A Little Household Frugal Tip

Posted By Paul

A nice little household frugal tip that I read on the Dollar Stretcher:
Whenever you open a can of fruit, instead of pouring the liquid/juice down the drain, save it in a salad dressing type container. Then add some balsamic vinegar, extra virgin olive oil, and spices to your liking to make a delicious salad dressing.

I also use it for braising meat, such as pork or chicken, and it makes the meat so much more flavorful. The store bought fruit flavored salad dressing can run about $4. You can make your own for a fraction of that. Enjoy your own gourmet salad dressing!
Krys in WA

I thought this was a cool idea since our little one has taken a liking to canned fruit so we've been buying quite a bit recently. Seems like a good idea to use the juice for something instead of just pouring it down the drain.

Friday, February 18, 2011

Diversification In Action, Another Plug For Tracking Net Worth

Posted By Paul

Long time readers of Frugalize will know that I watch my net worth very closely. (see a posting from 3 years ago tracking your net worth)

One thing I didn't mention in that article was that another advantage of tracking your net worth is that you automatically get an idea of how diversified you are (or aren't), and how that's working out.

About 7 years ago I started noticing that A LOT of my net worth was in real estate (i.e. my house). That was to be expected in that my house (like many houses at the time) was growing in value quickly. As my house became more valuable it became a bigger and bigger part of my total net worth. My other investments were doing fine as well, but they just couldn't keep pace with the crazy real estate market.

My reaction to this was to make it a point to focus more on OTHER types of savings. I wasn't someone who thought that real estate was going to just keep going up forever, so I decided I didn't want to have too much of my net worth tied up in real estate. Instead I focused on my emergency fund, and other types of investments. They weren't quite as exciting as the real estate market at the time, but I figured that since I'd already gotten a piece of that I didn't need to put all of my eggs in that one basket.

So today I realized one consequence of this choice was that in the last year or so my net worth has been tracking steadily up, even though the value of my home has been steadily trending down (Of course knowing the value of your home is always tricky, but I just use zillow for simplicity, and figure it is at least in the ballpark).

So even though my house is losing value, overall my net worth is continuing to grow. This is a direct consequence of having made other investments years back that offset the cooling real estate market now.

It's nice to know that my net worth isn't completely driven by the value of my home.

I think I'm going to stick with this strategy of always trying to stay diversified. I get a piece of every boom, and of course every bust as well. Thanks to the fact that I track my net worth I can honestly say that so far the strategy is working for me and overall I'm coming out ahead.

Thursday, February 10, 2011

Making sure my relatives have their wishes followed.

Posted By Paul

First of all sorry that I've been out of touch for so long, for the longest time I felt like I was so busy with stuff that I didn't have time to come up with a topic for this blog, but then I realized that a lot of the stuff I was dealing with was COMPLETELY relevant to this blog.

Also, sorry for the lame title of this posting, I couldn't think of anything clever.

Anyway, one of my new year's resolutions was to make sure that I knew my role when it came to my older relatives (parents, aunt, uncles, etc.) and their health directives. In particular I wanted to go to each of my CLOSE older relatives and ask them:

1) Did they have someone designated to make medical decisions on their behalf if they were medically incapaciated.

2) Did they need me to serve in that capacity in any way.

3) If so, then did they have a living well or any other info they could give me to make sure I knew what their wishes were.

It wasn't the easiest conversation to have because it's never fun to talk about these sorts of scenarios. I didn't want it to sound like I was sniffing around for an inheritance so I made sure to focus on HEALTH decisions (since I really have no expectations of inheriting money from anyone).

In some cases I was surprised to discover that my older relatives thought that I meant funeral arrangements, they'd say something like: "Oh, I already have a plot reserved." or something like that.

When I explained that I was more wondering about if they were in a coma or something and needed someone to make medical decisions for them, some of my relatives would just say: "Oh, just do what the doctor says." or "I don't want to be kept alive by machines." and figure that this was sufficient.

In cases like that I had to push my relatives a bit since telling me the info doesn't help if I'm not the person designated to make the decisions, and of course if I AM that person then I want more specific info as to their wishes.

I told them that if they had already designated someone else that was fine (even better than fine since it's not like it's a duty I look forward to), but if not, then I wanted to make it clear that if they wanted me to be that person then I wanted them to fill out a living will (and give me a copy) so that I would be able to follow their wishes if the situation came up. The last thing I want is to get an emergency call where I need to make a medical decision on behalf of a relative and have to guess at what to do or (even more frustrating) to know that they have a living will but it's somewhere in a drawer or safe deposit box where I can't get to it.

Also, with some of my closer relatives (specifically my parents) I also broached the subject of financial matters. For example I'm already a joint account holder on the bank accounts of my parents. I don't do anything with their accounts but it is good to know that if some emergency came up that I could access their accounts. This is especially good for piece of mind since my parents travel. It's good to know that if they were stuck somewhere and needed me to wire money for an emergency that I can just walk into a bank and help them out.

I'm also talking to my parents about setting up power of attorney, but I'm still working out some of those details. I hope to learn more about what I need to do in the near future as my wife and I are going through and getting all of our estate planning setup as well.

If anyone out there has been through this and is willing to share, I would appreciate any suggestions that people have.