Isn’t investing gambling?

It is understandable that we MSers, facing exceptional circumstances, want to protect any money we make from being squandered.
 
Our medications and healthcare costs are astronomical. Also, as a population, we physically may be forced to retire prematurely.
 
Like the U.S. Securities and Exchange Commission (SEC) says “Knowing how to secure your financial well-being is one of the most important things you’ll ever need in life.” 
 
This is especially true for us.
 
The MSer’s finances
 
Traditionally banks paid enough interest to make just saving what we could until retirement prudent. Unfortunately, not anymore.
 
How “safe” is a savings account if you leave all your money there for your working life, but the interest it earns doesn’t keep up with inflation when you are no longer working and need it?
 
This is why many people keep some of their money in savings, but look to investing to amplify their other money. For most people, the only way to attain financial security is both to save and invest over a long period of time. 
 
Generating vs. earning
 
I suggest we think about our finances as needing to generate income rather then simply earning it. Viewing it in terms of generating an income “takes the power out of (the provider’s) hands and places it into your own.”
 
It reminds us that we still have a lot of control over our future, maybe even more than this disease does.
 
I work hard for my money. It makes sense that my money should be working for me, too.  Why should investing be only considered the playground for the wealthy?
 
I resolve that it shouldn’t be. And for those of us in the U.S. with chronic disease, who live in this capitalist society, it is even more imperative.
 
Isn’t it gambling?
 
Well OK, yes and no.
 
For example, my clutter is gambling: 
“I purchased bargains with potential usefulness. I bought things as a gamble. I gambled on the chance that one day, my dreams would come true. I would turn into the kind of person who mended expensive but damaged clothing. I would be the tinkerer who repaired a lamp that made guests gasp in delight…(But) an amazing bargain that ultimately makes my life more difficult isn’t an amazing bargain at all.”
from Dana White’s book Decluttering at the Speed of Life
 
So is playing baseball:  “You can’t steal second base and keep your foot on first.” (Frederick B. Wilcox)
 
Thus I guess that investing is gambling too, but it’s risk that can and should be mitigated.  (You should never risk more than you can lose and still be okay.)
 
So “learn to earn”
 
While we probably aren’t born knowing how to invest, I think everyone should learn at least the basics.
 
Visit the SEC website. If you are still working, take advantage of webinars, podcasts and classes offered by your 401k provider. Be careful about the sources of your info, but you can teach yourself.
 
And ask for help if you’re scared. The MS Society offers free or low-cost consultations with experts
Tagged : / / / / / / /

I’m an MSer and a debt-oholic

Not unlike so many Americans, we battle debt but having a chronic illness in a country that does not have universal healthcare means that we are responsible for the slack on our own.
 
And all those costs like co-pays and coinsurance and medical equipment and incontinence supplies fall largely to us. 
 
How I became a debt-oholic 
 
When I was in college the credit card companies were eager to get us to sign up for a card. In our own name. How could I not? Now I recognize that as the seduction of a drug dealer. Just a little taste and then they got you.
 
Ever after, for the most part, I carried a balance and paid the interest on my credit card. I figured it was a small price to pay for the privilege.
 
I was convinced that, within reason, I could charge what I wanted when I wanted it and pay it off in installments.
 
What I should have done
 
First, amass and save a cushion, a small emergency fund, maybe $1500 in current times. Then keep empty credit cards in case of emergency, like the water main breaks or the heater goes out. 
 
(I like this idea better than accruing a large emergency fund. But another good place to stash additional emergency funds might be in your Roth 401k: although it is a retirement account, you could take back out little chunks up to the total amount of your contributions only, not any earnings, at any time with no penalty! I guess it depends on how you define ’emergency’.)
 
If you do need to use the cards, you must pay them back down to 0 again as soon as you can. That needs to go on the top of your priority list.
 
The plan in a nutshell
 
  1. Have 1-2 cards in your own name with zero balances that you can use as security when renting a car or getting a hotel room, but don’t use them to pay with! You are just showing vendors that you are good for it, that they can trust you. 
  2. If you must use a card, pay off the entire balance at the end of the month, ideally before any interest has been applied, but definitely as invoiced. 
  3. If you must carry a balance on the card, strive to pay it down quickly. And keep your eyes out for transfer offers that make sense for you.
  4. If you owe multiple loans and/or credit cards, note the interest rates of each and pay as much over the minimum payment as you can on the highest. Also I think you should never pay just the minimum on anything you owe. (And make sure there is no prepayment penalty that a lender wants to charge you for paying off the loan early. Hello? It’s your money! Not sure when that idea started, but it is definitely not consumer-friendly!)
When you pay even $1 over the minimum, it goes entirely towards just the balance, so if the agreement of your loan is that you are being assessed interest on whatever your current balance is, you can reduce the underlying balance this way: by paying extra over the minimum on all debts, even if it is as little as pennies! And as you pay one card off, you can add that payment amount to the payment amounts of the next one, and so on.
 
Opinions expressed are my own
 
Other stuff

Tagged : / / /

How I moved to telework

I’m an MSer. And I’m disabled. And I still work a full-time job. From home. Curious?
 
As Y2K started, although I was experiencing what I thought would be a temporary problem with one hand, I had just graduated college with a master’s degree in Library and Information Science. I felt like a right and proper grown-up!
 
But by Nov. 2002, the pharmaceutical company I had been working for was suddenly acquired by another company. They decided they didn’t need two librarians, so they laid me off and offered me severance pay until the end of the year.
 
New Job
 
I went to have a drink with a friend from grad school who worked at a legal start-up. Knowing about my MS, she wanted to help but also thought her small company could use me. So she urged me to talk to one of the founders. I had some experience in that field, so he offered me a job on the spot! 
 
In the beginning HR was already aware of my MS so I never had to decide to disclose. I did a little research, and wrote a few articles. Soon I began taking on more responsibility for the structure of the site in what would become an extensive web portal of free information to explain law to lay-people. 
 
Company Gets Bigger
 
Our company kept growing. I continued to go to HR every few years, after a doctor’s appointment, or when I had an allergic reaction to a new med, for example, to keep them apprised. I was always concerned when there was a staff turn-over that everyone was aware of my situation. I also began to work from home one day a week.
 
We had always provided a website with tons of free articles that explain legalese. But we now also help solo- and small law firms be more efficient, help them create websites, and provide advice about social media and marketing their services.
 
At one point I took over the user support “queues” that before had been farmed out to individual employees, each queue owned by a different employee, responsible for checking and replying to users. A thankless task not loved by anyone. But by offering to consolidate and take the whole thing over, I think I elevated my role in the organization.
 
Transition
 
In 2007 I started having trouble driving. So I asked for “reasonable accommodation” and transitioned to working from home full-time.  It didn’t hurt that my new supervisor was stationed in Florida then. I keep regular work hours and call-in to attend all-hands meetings, for example.
 
Currently I act as the entire consumer service team, not to be confused with the (paying) customer service team. Since I am one of the longest-lasting original employees, I am very familiar with, and can thus quickly find, where something is that a user wants. 
 
The situation works well for me. I work very well alone, but also am a team player when needed. Of course as history has shown, change happens. But I do feel comfortable with my employment for now.  And this is just one example of how to do this. 
 
Editor’s note: some of this has appeared in print before.
 
Other stuff

Tagged : / / /

Einstein ❤ compound interest?

Did Albert Einstein declare compound interest to be ‘the most powerful force in the universe’? The website snopes.com which tries to verify urban legends rules it “dubious”. Nevertheless, I geek out a little on the idea.

image from lorna.typepad.comDid Albert Einstein declare compound interest to be 'the most powerful force in the universe'? The website snopes.com which tries to verify urban legends rules it "dubious". Nevertheless, I geek out a little on the idea.
 
Simple Interest Bad-ish
 
Simple interest just acts like a fee assessed on your remaining loan amount as you pay it down each pay period, for example. This is why, when you are paying down a mortgage or credit card balance, it is always helpful to add even a few dollars more toward the principal to get it down as quickly as you can. 
 
In this situation, interest will only be assessed on the remaining balance.
 
(You also want to make sure there is no "prepayment penalty" you would have to pay in the event you pay the whole thing off early–shocker–although if there is, you can decide to pay it anyway or to slow down your payment schedule to stretch it to the finish line. But what a better problem to have!)
 
Compound Interest Good
 
In contrast, compound interest on your savings, for example, is interest assessed on your new balance then added to your principal so the next pay period your balance is principal plus the interest added to it in the last pay period and so on. 
 
You wouldn't want it assessed this way on a loan balance, but on your savings, this is how, if not touched, it can grow. This is what is meant by compounding and it can be good.
 
Credit Card Debt Bad
 
But compound interest assessed on credit card debt is bad. The debt is bad for everyone, but especially bad for us because we need to be judiciously using all of our resources to meet "our highest priorities."
 
And interest on credit card debt keeps us from saving or investing and is non-deductible on our taxes.  
 
In a recent NMSS Presentation Dick Bell of Bell Financial said to think of it like this: "Not paying $500 a month in non-deductible credit card debt could be $500 more you add to your savings or retirement. "
 
Next Steps
 
He continued, saying "Your earning power is your greatest asset." But reminded us that a person with M.S may not be able to work a full day or even to work to full retirement age.  
 
And while we may not be able to affect our income (in the short-term anyway), we can affect our spending. So the first thing to focus on is getting rid of credit card debt. That and starting an emergency fund.
 
If you have no extra money, could you return cans, for example, to just get $2 extra dollars? Then add $1 to your credit card bill and $1 to start your emergency fund.
 
Bell insists that "Success breeds success." Even baby steps count.
 
Finally, as we have seen, using a credit card for an emergency should only be considered as a last resort. And if you do use it, try to pay it off as soon as possible.
 
Related
 
Tagged : / / / /

Money tips for MSers

Since your earning power is widely regarded as your greatest resource, for those of us with MS it is even more critical to make financial plans as soon as possible,

image from lorna.typepad.comOne of the things I wish I had been more conscious about when I was first diagnosed, was my money flow, being more disciplined about saving.  And it seems that is more common than I thought: a recent article in the New York Times reports that 45% of Americans surveyed said they have not saved anything for retirement.  
 
And since your earning power is widely regarded as your greatest resource, for those of us with MS it is even more critical to make financial plans as soon as possible: MS is a disease that tends to manifest in early to middle age, sometimes causing MSers enough disability to be forced out of the workforce early. Which shortens the time we have for earning power and lengthens the time we may be drawing down on whatever disability funds we have.  You see where I’m going with this?
 
It is also an expensive disease, with most MS medications, currently recommended that you take the rest of your life, costing several thousand dollars a month.  🙁
 
In a recent presentation held by the National MS Society, Dick Bell of Financial Education Partners Foundation, describes Financial Planning as “Directing your limited resources to meeting your highest priority goals.”  Here are some of my takeaways.
 
1. Keep a quarterly scorecard
 
As I’ve explained before, I’ve always used “making a budget” as a way of making sure the things I needed covering were covered with how much or how little I was bringing in.  Bell calls this a “financial scorecard” instead. It’s a quick summary of your assets and liabilities, a snapshot of where you are with your money.  
 
He suggests we track our income, our expenditures, our debt, our savings, and any investments quarterly on a spreadsheet. He points out that we are raised to be competitive and that in this case we are only competing with last year’s version of ourselves.  As in sports, if we don’t measure it, how will we know if we are winning, or even getting better?
 
“Success breeds more success and that’s why we need to keep a scorecard.”   I like this. I’m keeping it.
 
2. Pay off your credit cards
 
Really, I believe that paying any interest should be avoided: credit cards, student loans, personal loans, even loans from your parents. Of course that’s “Do as I say, not as I do” as I have been carrying credit card debt off and on since college. Ouch.
 
Bell argues that not paying $500 a month in non-deductible credit card interest could be $500 more each month we could be saving for retirement.  So I think getting rid of it and not creating more in the future needs to be one of the aforementioned highest priority goals.
 
3. Shop only with a list 
 
Always make and stick to your list when shopping. If you discover other wants, add them to a later list.  When you revisit that list, you may find that you prefer cash in the bank instead. 
 
And pay cash whenever possible. Again, according to Bell, people who pay cash tend to spend 11-17% less than those who pay with a credit or debit card.
 
“The most critical part of getting ahead financially is living on less than you bring in each month.”   You may not be able to quickly adjust your income (although I can see several possibilities here), but you can easily control your spending.
 
4. Keep learning things
 
Having now lived with MS for years, I find that I come back to these a few websites regularly for money answers. I’ve had them bookmarked for years, so I’ve seen that I really can trust them. Well, I trust what they say but I’m no expert and am frankly a timid investor. Again “do as I say” yadda yadda yadda.
But sometimes I am bolder than others, and so I would challenge you to try to do something, maybe one thing a week, even something small, towards a financially stable future.

Tagged : /

Reluctant budgeter

I’ve always seen making a budget as “more of a guideline”.

I’ve always seen making a budget as a way of making sure the things I needed covering were covered with how much or how little I was bringing in. I actually never saw it as a hard and fast rule, but “more of a guideline” as Barbossa in Pirates of the Caribbean put it.
 
So I was really surprised to find that so many of my friends are vehemently against them, think they hinder spontaneity and limit flexibility.  I feel just the opposite. How can you be flexible without knowing what you have to play with?
 
But then again I am a bit of a control freak. C’est la vie 
 
Example: A Basic Budget

I have tried some online apps to do this, but have yet to find one I like. So I am still just plugging along with Microsoft’s Excel spreadsheet software which is what I’ve been using since I first left home.

  1. Start by listing all items you can think of that you pay for every month in column A. Brainstorm monthly, semi-monthly, and annual dues as well.  Don’t spend a lot of time on this at this time.   
  2. When you are finished, you may want to move items around in the list to place like items with like items, then skip to column E, title it ‘Net Amount’. and then go down the list and write the approximate payments you make per increment. In this example life insurance is $41.28 per quarter, water is $60 every two months.  If you know the actual payment, put that in but it’s nothing to interrupt yourself to correct at this point. 
  3. Go back and title column B ‘Frequency’,  write the frequency of payment.  (In the above examples, I’d say Quarterly and Bimonthly, but you might find that confusing because bimonthly means both twice per month and every other month. As you can see, I listed both in separate columns.  I told you, ‘control freak’!) So let’s stick with digits so we can use that in our equations: how many times a year you are required to pay. In the above, 4 and 6, and if you want, add another column after that but before the Net Amount for the multiplication sign, and after for the divided by 12 instruction*
  4. Then title the next column ‘Net Monthly’, you will write a calculation multiplying the net amount by frequency and dividing into twelve to get a monthly amount.  For water, it looks like this =C18*E18/12, where c18 is 6 (times a year) and e18 is 60 (the amount due each time I pay) divided by 12 (months). 
  5. For the last column, ‘Net Annually’ I use =G18*12, which is the amount I just calculated multiplied (again) by 12 for the year.

*These notations are just for show.  In Excel, which is spreadsheet software, you will need to preface actual commands with the equal sign. But if you want to show an actual equal sign you will need to enclose it in quotation marks like this: =”=”
You can see the actual formulas by pressing CTRL + ` (grave accent–on my keyboard it is to the left of the “1”). Hit it again to return to the standard view.

What it looks like

 

Showing the Formulas

Tagged : / /

Add income streams

The average MSer should strive to have multiple income streams, or at least more than one.  

I came across this claim recently: "...the average millionaire has 7 different income streams." Wow.  Way to ensure financial security!
 
More relevant to us is that the average MSer should strive to have multiple income streams, or at least more than one.  
 
For example
 
If you are still working, you have your salary.  And if you are still getting a paycheck, whether or not you decide to disclose your diagnosis to your employer, you need to now seriously consider that you are ultimately self-employed. Investigate telecommuting.  Ask for a raise. Start squirreling away money for an emergency fund
 
If you have a life partner who is able to work, too, and you share financial decisions, this may be a second stream of income. Discuss amongst yourselves.
 
If you are no longer able to work but are eligible for it, get on Social Security Disability (SSDI) as soon as possible.  The goal here is to have a stable source of funds and then try to maximize it as much as possible. Save where you can. Resolve to only buy with a coupon. Stock up when items are on sale.
 
If you can no longer work, and are not eligible for Social Security, you can have a pity party for yourself for half a day at most, then dry your tears and keep reading.
 
Any savings could morph into another stream of income. Check out 401(k) rules, IRA/RothIRA, annuities, other investment vehicles. (I trust and always start my money research with The Motley Fool website). But if you haven't started to save, do it now. Start today. Give yourself some flexibility and choice in the future.  
 
Finally, consider starting a "side hustle" or two.  One of the most tempting to me right now is shopping for stuff at thrift stores to resell on EBay. Check out other ideas here:
 
 

Tagged : / / / /

On shelter, food and money

In times of panic, I take a few deep breaths then try to calmly assess my current situation–my shelter, food & money–to realize that right here, right now, right at this exact moment, I’m okay.

When first diagnosed, you may suddenly feel like you are in a free-fall, that this was not what you were expecting, or that you knew something was wrong but now that you hear it, you imagine in an instant how differently your life will be, at least in the next few months.
 
In times of panic, I take a few deep breaths then try to calmly assess my current situation–my shelter, food & money–to realize that right here, right now, right at this exact moment, I'm okay.
 
With that in mind, I present these helpful categories:
 
shelter. 
Initially I wanted to call this category 'home' but I realized that some people are not in a place they would consider a 'forever' home and might flinch at the term. Maybe you are newly diagnosed and intending to move right away, or maybe you are temporarily in a rehab hospital or some other residential facility.
 
Maslow's hierarchy of needs says that at the most basic level we need shelter. So whatever your shelter situation, I hope you find information you can use in this category.
 
food.
Here I discuss my own experiences with ms diets and creating a meal plan. I also will share some easy recipes I've tried and recommend, some I plan to try, and maybe even report on some fails!
 
money.
This is a place where I review basic finance, income, as well as any other employment and estate planning issues.
 
assists.
Finally, the category for things I use to help me. Àlso product reviews, self-help tips and tricks, maybe even an occasional helpful quote or positive affirmation.
 
I was diagnosed with multiple sclerosis (m.s.) in July 1991 so I've been learning to live with it for more than 25 years. Follow me here to learn and share things.
 
And know that you can do this.

Tagged : / /

Things to do when newly diagnosed

MS is not, in and of itself, a terminal disease. As far as I know it does not kill, although it may cause you to lose your ability to walk, to talk, to feed yourself, even to breathe. But it is not a degeneration of your muscles. It is a degeneration of your nerves.
 
This is what we believe as of today: it’s a neurological disease. I also think we agree that it most often originally manifests in the brain and spinal cord, and sooner or later affects the signals sent to other parts of your body.  
 
There has still not been an actual cause identified, nor is there a cure. Know that you did nothing “wrong” to cause it, and you certainly did not ask for it. And while there are medications on the market today that attempt to slow-down the progression of the disease, they work on everybody differently. It may take some trial-and-error to find the one that is right for you.
 
These are some first things I’d recommend you do when newly diagnosed:
 
  1. Forge a relationship with a doctor. Find a neurologist, ideally an MS specialist, but more importantly someone you can work with over time, someone who listens to you, someone you can reach when you have a question. This may be the doctor who diagnosed you, but maybe not. Remember that no one cares as much about you than you do. Make sure you are working with someone who honors that.

    Consider that you are now creating your own healthcare ”team”: general practitioner, neurologist, physical therapist, ophthalmologist, psychologist, naturopath, dentist, gynecologist, etc.  Maybe print out a DATED list of all members on your “team” and give it to each one to be kept in your file, along with a list of all medications, even vitamins and supplements, that you are currently taking. Keep regular appointments with each and give them updated lists at every visit.

  2. Start prescriptions ASAP. Get on medication as soon as possible. As drastic as it might seem in the beginning, when your first symptom may have already gone away, most of the time M.S. continues to do damage behind the scenes. And when you do begin to show symptoms, it may be to late to reverse any damage.  At this time there is no known way to do that. 

  3. Do something from your bucket list. Do something you’ve been wanting to do, however small, right now, today. For example, I’d wanted to learn to ride a motorcycle for years before I got diagnosed, so I used it as an excuse to start, enrolled in a motorcycle safety course, then bought a used bike, got licensed for it, commuted on it for a number of years, and finally quit to do something else on my list. I could never ride now, so I’m glad I did it when I was still able to. Consider starting your own “bucket list”, things you’d like to have experienced or done before you can no longer do them, or before you die, i.e.”kick the bucket”.

  4. Introduce yourself at a support group.  Contact a local chapter of the National Multiple Sclerosis Society (NMSS) to find one. Take advantage of their free resources while you are there. Also check into other related groups (see list below). In the beginning of this journey, you may find a support group but think you have nothing to offer and besides, everyone there seems so much worse off then you and who wants to be reminded of how bad things could get? But resist that thought.

    Whether you go regularly or just whenever, consider this part of building your team.  It is always helpful to know others on this path, and while your acquaintances may start to refer to you others in their lives who have just been diagnosed or touched in some other way by this disease, do not allow this to be your only contact with other MSers; going to a support group is a sure-fire way to be around groups of others who know what it is like to be living with this.

  5. Examine your spirituality. Decide what you do or do not believe. Enough said.
Finally, if you are so inclined, find a diet or other eating plan that you can stick with.  I started off in a flurry, determined to make any dietary changes that made sense to me. After a year when I wasn’t seeing any evidence it was helping (how, exactly?), but I also didn’t have another “flare up” (and it never occurred to me to connect the two!), I quit the diet, joking that “A life without cheese is no life at all.”
 
Would it have made any difference to my situation now? Who knows. There has not been any scientific research to prove definitively that diet makes a difference. But if I could do it over again, I’d stay on the side of “restricted”, liberally allowing myself to “cheat” rather than giving it up entirely.  If you are interested in diet and MS, the “Swank” diet seems to be the authority: originally published in 1972, it’s been revised and updated incorporating new research ever since. (The Multiple Sclerosis Diet Book Swank, Roy.)
 
Be gentle with yourself.  Know that this will not be a sprint but a marathon.  
 
Related stuff
  • MSAA MS Association of America, a U.S. nonprofit organization founded in 1970.
  • NMSS National MS Society, a U.S. nonprofit founded in 1946.
  • NARCOMS North American Research Committee on MS, global registry for MS research, established in 1993.
  • PatientsLikeMe.com A health information sharing website for patients, launched in 2011
  • MSFriends NMSS program for peer-to-peer phone support
Tagged :

Use power for good

$50,000 is a lot of money to us; for big corporations, it’s only a drop or less.

I feel like I'm getting first-hand experience that I can share with my peers as they age.

OH and I cheer each other up by telling ourselves that we are "going first," testing the water.

Have to be concerned about falling?  I'm already there.

Need to walk with a walker? I already do. Use a wheelchair? Yep.  [And friends that are arranging to borrow loaners for me are getting experience too!]

Get a disabled placard? I got it [And even though I am not driving anymore, I still use it when going out with friends.]

Buy and wear disposable underwear? I've got experience.

Use a pill container? (That's for you, J!) Sure.

I talked to a caller recently about his frustration with the hospital billing him instead of his health insurance company because they didn't want to "deal with the company" anymore.  [Sadly, I have experience with this, too.]

I'm guessing the caller would prefer not to "deal" with either of them either!   This seems so childish to me.

I look at this situation and am disgusted.  We are sick. We can't spend our limited energy to mediate hurt feelings between the hospital and the insurance company.

$50,000 is a lot of money to us; for big corporations, it's only a drop or less.

I think the majority of us would like to honor our debts [if they are, in fact, our debts, not the hospital's bloated idea of place to start negotiating] but maybe just not in the time frame when they want it.

Don't even get me started on the costs we have to bear for the expensive medications that may or may not even be working!  There is still no way to test for that; we can only wait and see.

And when you are just trying to do your best, make ends meet, and hang on until the next day when hopefully it will be better, petty squabbling between big corporations seems so pathetic.

I wish I could slap them and say "Grow up!"  

Tagged : / / / /