Money Woes

Dear FHA,

With the current economic climate I've been working really hard to be more conscious about where I spend my money. I'm working really hard at finding places to put my money so it can work for me. I have a young child I want to send to college as well as a house payment. My job has a small 401K matching plan, but it won't be enough to support me and my wife when I retire, so I want to start saving for that as well. Do you have any investment tips that could help me achieve my goals?

Sincerely,
Goal Achieving Dad


Dear GAD,

Money seems to be the top issue on peoples minds these days. I also have had to tighten the purse strings in my financial life. Normally I wouldn't blink at dropping $200 on fireworks and Stetson cologne, but its hard to justify spending that much even on things as essential as those. With that in mind, I'll try to lead you to the river of wisdom I drink from.

1. Cut unnecessary costs. The number one way to save money is to spend less of the money that you do make. Look at your current budget and determine what you can eliminate. Better yet, try and find what you can keep and not pay for. I love having power but hate paying for it! With a few stealthily placed extension cords on neighboring properties, I enjoy the benefits of electricity without hemorrhaging cash. Similar strategies can be used to save money on water, sewage, and trash services. I would however recommend substituting hoses and buckets in place of extension cords for those particular endeavors.

2. Diversify your investments. The more places you have your money invested, the less likely you are to lose it all with one downturn. I fell victim to this several years ago. I had allocated almost my entire income to investing in snow globes. My portfolio was impressive as I had globes spanning from Maine to Hawaii, a place where it doesn't even snow! I was poised to retire in literally tens of years when an upstairs neighbor's meth lab blew, causing a percussion wave that knocked all of my investments from the display shelves and rendering their value near worthless. After such a monumental loss, I have headed my own advice and spread my investments to such areas as lottery tickets, topical T-shirts, and US Savings Bonds.

3. Secure extra income. Many people have hobbies that could garner them some extra cash in these tight times. Suppose you knit, you could sell scarves on e-bay. If you like to do video editing, try to find a wedding video someone needs some help with and is willing to pay. You really like to do drugs, buy a little extra and sell to your friends. There is no reason you can't turn your free time filler into a profitable venture.

4. Have realistic expectations. I know this one might be hardest to follow. Every parent wants to send junior to Yale, but will the benefits outweight the cost? Sure a great education is the right of every American. The thing you have to ask yourself is, what's junior going to do with it? Right now he licks windows and always seems to end up with pennies in his mouth. For him going to Yale will only be a six-figure piece of paper on the wall. I always say shoot for the highest point on the mountain that you can get to without spending a ton on a guide or having to take a cab there. Something like DeVry might be your best bet. It isn't just the fact you're only paying for two years of school, its the fact that junior will be working for an extra two years earning top wages for his Associates degree/certifcate field. The sooner you are earning the better. Plus Yale kids are all fags.

5. Act on your plans. The worst thing you can do is sit by and think about what you should be doing instead of actually doing it. I can say I'm gonna start saving money when I'm eight Red-dogs deep on a Thursday afternoon, but until I start saving it means nothing. Even if you just start with a change jar, preferably one that you can't easily get the money back out of, is a good start. Actions speak louder than drunken slurs.

6. Lie, cheat, and steal. Its been working for Corporate America for years. Golden parachutes, Government bailouts, bonuses paid on false earning reports. This one really speaks for itself, so get you some.

GAD, these are the pointers I would suggest to any parent that is looking to save for retirement and their childs education. Its a rough time right now so being diligent is the best you can hope for. If you truely love your wife and child, and want to provide for them as best as possible, follow this advice. However if you aren't that attached to your kid, get a large insurance policy, fake a house fire, and leave the kid in there. Instant chunk of change, and with all that college savings you could get a boat to play with on your new lake home. Just a thought.

Sincerely,
FHA