I could buy a one- or two- year T-bill paying better than 2.25 percent. So why would I buy a CD paying half or three-quarters percent?
Here’s a quote from a good post on the difference between “feeling broke” and “being broke,” that also touches on tactics for getting by when you’re pretty close to that latter category—topics I wrote a lot about for Wise Bread.
What made me want to comment is a bit right near the beginning where the writer talks about the discontinuity in housing prices: Down to a certain price point you can pay a little less and get a little less space and slightly downgraded amenities, but there’s a breakpoint where that quits being true:
That’s the drop-off you experience at the lower price levels – there’s nothing between “This is a tiny but acceptable apartment” and “Slum apartments in stab-ville”.On The Experience of Being Poor-ish, For People Who Aren’t – Resident Contrarian
The point I want to make is that this is only true in general. If you had to find 100 apartments that were cheaper-than-basic but not in a slum, you’d probably be out of luck. But unless your job is to find apartments for poor people, that doesn’t really matter. For your own household you only need to find one apartment that’s cheap but not in a slum, and across your city there’s probably several of those. (Maybe a small apartment building that’s not part of a complex, maybe a three-plex or four-plex, maybe a duplex owned by a retiree who is looking for a very low-maintenance tenant, maybe a big old house that was cut up into apartments, etc.)
The author is clearly aware of this—he goes into some detail on applying similar thinking to furniture (where you only need to get a great price on a great dining room table once and it’ll last the rest of your life). Applying it to apartments is different for various reasons (mostly having to do with urgency and risk—you can’t just wait indefinitely, because being homeless is different from eating off a TV tray table while you look for a great deal on a dining room table), but it’s not completely different.
For the first decade after my former employer closed the site where I’d worked, Jackie and I did a lot of that—looking to satisfy each need we had with one instance where we could get something of very high quality at an especially good price. It’s a tactic that works great, but only in a narrow range of circumstances. It’s not so good for people working long hours at a difficult job, because they lack the time and energy to do the search. It’s also not so good for people who are really broke (not just broke-ish), because these sorts of deals often require that you have cash on hand to close the deal immediately.
Here’s one of my old Wise Bread articles applying this thinking more broadly: How to have an above-average life for below-average prices.
Too bad the Fed doesn’t have any epidemiologists. Or virologists working on vaccines.
My brother adds, “They probably don’t even have any mixologists.”
Of course, it is cocktail hour…
Vicki Robin of Your Money or Your Life is right about responding to Covid-19 if you’re financially independent:
I wake up every morning asking, “What can I do for others to ease their material or psychological pain as Covid-19 upends our lives?” and “How can I use my leadership in communities of influence to increase vigilance where people are slack and calm where people are freaked?” The privilege of financial independence is the ability to serve.
With no card number, CVV security code, expiration date or signature on the card, Apple Card is more secure than any other physical credit card.
While @jackieLbrewer was working at the bakery there was a cash register glitch. For several days they took credit card payments on paper, writing the number down by hand, and then entering them manually at the end of the day.
Those customers would have been totally secure from being able to buy bread.
The government shutdown gives renewed relevance to this 4-part series I wrote for Wise Bread at the peak of the financial crisis: Getting by without a job, part 1–losing a job
At some point in the last few years, presumably related to my writing for Wise Bread, a whole bunch of PR flacks started sending me their press releases—mostly about money stuff, with a little writing stuff and journalism stuff thrown in.
It has been very tedious, but I have hesitated to mark these messages as spam, because the topics are things that interest me (even if the actually email messages are almost never of any interest whatsoever).
After spending a year or two just deleting all that crap manually, I’ve spent a few minutes today making a filter that grabs that stuff and puts it in a folder called “Lame PR” so I don’t have it cluttering up my inbox.
So far I’m sorting by sender, because I think there are only about a dozen senders behind the majority of this crap. Maybe I’m mistaken. There may be too many senders. But I doubt if they’re doing the spammer tricks to make this stuff hard to filter. (They’re hoping that I find their “content” so useful, I’ll be using filters to make sure I do see their content!)
Once I get them filtered out, my inbox will be much more useful than it has been.
Some years back, I read a financial newsletter article that offered a technique for predicting inflation rates six months in advance. It had charts that compared its predictions to actual results, that showed that it was pretty accurate. Not perfect, but more than close enough to be useful for short-term planning.
Then I read the details. Their “technique” was this:
- Take the actual inflation for the previous six months.
- Double it.
As I say, their technique was pretty accurate. Partially it was accurate because the economy rarely turns on a dime—recent trends tend to continue. But it was more accurate than that, because half the months they were “predicting” had already happened! Even if the next six months were rather different from the previous six months, that would only produce so much change in the full year results.
I think that was the point when I decided to let my subscription to that newsletter expire.