(Financial) Retard of the Month for May

May 30, 2012

 

Meet The Simple Dollar's archnemesis, National Park Bookstore Patron

 

We don’t pick on Trent Hamm of The Simple Dollar because he’s an inviting target, although he is. We pick on him because he fancies himself as an advisor. It’s right there in the subtitle of his blog: “Coupons and Financial Advice.” Yet if you acted on his counsel, your life would be an endless treadmill of calculating barely perceptible savings on mundane activities. And who knows what you’d be missing out on.

Headhunter: Hi, Ms. Bland? We’re looking for a new sales associate and we think you’d be perfect for the job. Whatever you’re making now, we can double it. Can you come in for an interview?

Simple Dollar Devotee: Where are you located?

Headhunter: On the corner of 1st and Main.

Simple Dollar Devotee: Well, that’s 15.98012 miles from my house. My Prius gets 42.29830 miles to the gallon (I’m obsessive like Trent, therefore I calculate such things to the 5th decimal place.) So with gas at $3.989 a gallon I’d be paying $3.01 to interview with you.

Headhunter: You do realize that this is a phone conversation, and that I can’t hear your italicizing and bolding, right?

Simple Dollar Devotee: Plus my car depreciates at an average of 12.31209¢ per mile, so that’s an extra $3.93 I’d be spending to go to this interview, for a total of $6.94. If you don’t hire me, that’s a sunk cost.

Headhunter: (snoring)

Plus, Mr. Hamm is the most ungainly writer ever to sit in front of a computer. He figures that because he’s got the rudiments of composition (largely) under control, he’s therefore the personal finance answer to Joyce or Dickens. No. Knowing the rules of football doesn’t make you an all-pro. At best, it might make you a back judge.

Just like knowing how to reuse Ziploc bags doesn’t make you an expert on personal finance, just a lunatic. Guess how many results the word “frugal” returns when you search for it on The Simple Dollar.

6,340. “Frugality” gets another 6,290, for a total of 12,630.

The word “and” occurs in the New Testament only 10,684 times.

The Baha Men want to know if Trent Hamm can sing any other songs. Keanu Reeves thinks Trent has limited range. Euclid’s definition of a line said that The Simple Dollar is too 1-dimensional.

The latest foolishness from the Most Inane Voice In Personal Finance is so good, it bumped another Trent Hamm submission for Retard of the Month. This week, Trent teaches us how to save money at…tourist attraction gift shops. You know, because such places are an everyday temptation. Also, “keep your money in your wallet” is only 6 words and therefore too short a recommendation to be useful as far as Trent is concerned.

I particularly don’t like it when you go through a museum exhibit or a tour of some sort, only to find yourself dumped into a gift shop.

The children are hungry and thirsty and often tired after such a trip

Who under the age of born-in-the-19th-century uses the word “children” instead of “kids”?

This is absolutely my least favorite part of traveling and visiting new places. It’s often an expense. It’s always a hassle.

Fortunately,

years of planning family vacations with a frugal mindset has helped me to avoid these traps more and more often.

At this point, does Trent need to use the qualifier “with a frugal mindset” when describing any activity that he does? We can’t even cite ridiculous imaginary examples here to illustrate the point, because the real ones are better. The generic go-to activity would be “brushing your teeth ‘with a frugal mindset’”, but damned if he didn’t already beat us to it. Several times.

Here are some of the tactics we use

Trent has a 4-point strategy for not buying snow globes at the Grand Canyon.

(1) Do the research. Before you go on vacations, spend some time researching the places you’re considering visiting. Find out if these places force you through a gift shop or not, and use such techniques as a negative when considering whether to use that item as part of your vacation.

How does that play out?

You: Hello, Roman Colosseum?

Her: Ciao.

You: Avete un negozio di souvenir?

Her: Sì. cosa ti piacerebbe? 

You: Never mind. Thank you. (To your traveling partners) Okay, that’s out. Damn. I really wanted to see the Colosseum, too. Alright, next up is the Pyramids. Anyone know Arabic?

Wait, what did Trent say?

use such techniques as a negative when considering whether to use that item as part of your vacation.

So “don’t go”, you’re saying (verbosely)?

Also, what are the “techniques” here? What is the “item”? Maybe Trent knows Arabic, because God knows his command of English is brutal.

a gift shop needs to be my option, not foisted upon me.

Yes, because gift shop clerks are notorious for holding visitors at gunpoint until they agree to take home a logo canvas bag.

(2.) Your first step should simply include digital photographs.

Then a Trent Hamm specialty, the immediately succeeding unnecessary follow-up sentence:

If you want to remember something, take a picture

But wait, Trent. Why would someone take a picture?

so that you can look at it later.

Of course! Knew it was something, couldn’t put our finger on it.

Again, we haven’t omitted anything. We’re in the middle of one unbroken stream of Trentness:

Similarly, recording your thoughts in a travel journal while going from place to place on a vacation can be wonderful.

Stephen King once wrote to aspiring writers that “the adverb is not your friend.” But he never met Trent, who never met a –ly he didn’t fall in love with.

Also, “wonderful” is on that list of words that no heterosexual man should use:

Tummy
Veggie, or veggies
Wonderful
Fabulous
Soupçon
Gorgeous
Onesie
Booties
Adorable, unless used ironically

There are probably others. Wait, we’re building to something here. Behold The Most Trent Passage Ever:

I often look for natural souvenirs to bring home, such as unique rocks. We have stones from tne (sic) north shore of Lake Superior and from the Arbuckle Mountains in our yard. Other family members have bricks and baseballs found on vacations.

Notwithstanding the convenient location of the Arbuckle Mountains, that sums it up right there. The Hamm clan collects rocks, bricks, and baseballs. And note the verb “found”. Trent’s not talking about a foul ball that landed in his kid’s glove at a minor league game. His family members find baseballs while on vacation. Where do you go to find a random baseball, i.e. without going to a sporting goods store and paying for one? Do the Hamms wait outside Little League games and steal them when no one’s looking? Does going to a Little League game in a strange town qualify as a vacation in Trent’s world? And would doing so count as an “end experience” or a “peak experience”? We’re guessing “end”.

Look, no one’s saying you should overindulge your kids. But come on. No, Junior, you can’t have that $10 field guide to the Birds of North America. Instead, how about this mostly intact cinder block your dad discovered in the parking lot?

Don’t spend like an idiot, that’s a given. But for the love of Pete, if you consider a rock to be a souvenir (not a geode, not iron pyrite, an ordinary rock), the best thing you can do for humanity is to throw said rock up in the air and catch it with your forehead.

Filed Under: Bad Examples, Financial Retard of the Month Tagged With: , , , , ,

The Ultimate Christmas Gift

December 23, 2011

Last year, American Express created a website that concentrated on personal finance: GetCurrency.com. They solicited writers from among the most prominent personal finance bloggers. We offered our talents, and the GetCurrency.com editors found our submissions wanting. Meanwhile, they’d run posts from that earnest imbecile at The Simple Dollar who tells blatant lies about how his 4-year-old has started a college fund.

As 2011 enters the home stretch, guess what? Control Your Cash is going better than ever. As for GetCurrency.com, here’s a recent screenshot:

Schadenfreude, and it feels so good…

So here it is again, our annual post about the best possible Christmas gift. We recommend this gift as suitable for giving to just about any individual or business. Except for GetCurrency.com; for them we’d go with a cemetery plot and a gravestone. Season’s freaking Greetings. 

From a utilitarian perspective, giving gifts makes no sense. Generally speaking, you buy gifts for people who are likely to buy you gifts – hence the term “exchanging”. Receive a gift from someone you had no intention of buying anything for, and you’re selfish and inconsiderate. Do the opposite and you’re a sucker. And if you do buy something for someone who buys something for you, custom dictates that the gifts can’t be of disparate value: hence the ludicrous practice of removing price labels. After all, nothing ruins the joy of receiving a thoughtful and apposite gift than finding out the donor spent too little on it.

Think about it: you spend money to get people things that you hope they’ll like. If they don’t, you’ve wasted your time and resources. Thus the most useful possible gift is the one perfectly adaptable one: cash. But again, the suitability of cash runs into the brick wall of decorum. ‘Tis the season to be gauche. And again, if the recipient adopts the same logic about gift-giving, you end up exchanging cash for cash. Reduced to its fundamentals, the transaction is easy if quotidian: instead of you buying me a $150 gift and me buying you a $160 one, I should just give you $10. Then we can spend the next year discussing how I’m tacky and you’re cheap.

If you’re the parent of a young adult, or otherwise have someone in your life whose net worth isn’t yet where yours is, here’s a mutually beneficial idea for a decidedly American gift that isn’t cash: the next best thing, credit.

The average college graduate receives that bachelor’s degree with a 5-digit Sallie Mae obligation. As for the prudent and responsible students who manage to graduate with no or minimal student loans, doing so usually means there’s hardly enough money remaining to create any kind of nest egg. The wealth-building years have begun in earnest, but there’s almost nothing to lay a foundation with. Renting an apartment for the next few years (an investment with a guaranteed rate of return of -100%) wipes away much of the equity a young person could be building.

If you can afford it, lend your upwardly mobile kid enough to cover the down payment on a modest little domicile. Even buying the tiniest of townhomes gives him or her the opportunity to build equity, and to exercise the care and consideration for one’s things that renters have no incentive to.

Say you find an $80,000 condo that requires a 20% down payment to avoid private mortgage insurance costs. Financing the remaining $64,000 at today’s 3.40% 15-year rates means your kid would write monthly checks for $454.39, which makes far more sense than spending $800 on a larger rental house in a fancier part of town.

Remember, this isn’t a gift in the traditional sense. As the giver, you’re expecting something in return – regular payments, with interest. If you can give your kid a 100-basis point break on market rates, she could pay back that $16,000 loan back to you in $105.93 monthly installments. Which should be pretty easy to do, especially if she’s collecting rent from a roommate. Of course, we’re assuming she’ll be making gradually more money throughout the life of her concurrent loans.

The real “gift” in this situation is something intangible but vital: an introduction to real-world finance, and a chance to exercise responsibility. It’s the ideal meeting of a recipient whose ambitions outweigh her wherewithal, and a donor with the ability to make the recipient’s transition into the world of commerce run a little more smoothly.

So for a close loved one who’d stand to benefit from the gesture, don’t “give” a gift. Lend something instead. That way you can help foster a sense of ownership and responsibility, which beats a trinket or a consumable any day of the week.

**This article is featured in the Carnival of Personal Finance #341: Christmas in Australia Edition**

Filed Under: Making Smart Choices, Shopping Tagged With: , , , ,

Carnival of Wealth, miserable cold edition

December 5, 2011

The Midway in the Pacific isn’t as dismal as this one

 

So, what shivering part of the Northern Hemisphere are you reading this from? Have you resorted to making a fire out of seldom-used furniture yet? It’s sunny and 80º here at our undisclosed location, a perfect situation for a) rubbing it in your faces and b) presenting the latest installment of the Carnival of Wealth. Again, these are personal finance posts from the genre’s most prominent bloggers, arranged in handy mini-paragraph form. Get readin’.

Remember the good old days, when every time you bought something with a credit card, you gave a minimum-wage clerk your credit card number and a copy of your signature? Boomer and Echo do, and argue that security has since gotten worse. They regale us with the tales of prospective tenant Amy Adams and theft victim Bill Brown, the least plausible pseudonyms we’ve ever heard. Tune in next week to see how Carmine Cappuccio, Don DeLillo and Edna Everage combat identity theft.

Marjorie Rochon at CardHub tells us that there are a few things you can count on every non-denominational holiday season that alienates neither Jews nor Muslims Christmas: time off from school; an overweight, bearded out-of-towner breaking into numerous houses in the neighborhood via chimney; eating too much; and gift cards. Learn how to handle that last one.

Some people pride themselves on not shopping at Walmart, as if low prices are somehow gauche. Odysseas Papadimitriou of Wallet Blog is not one of them. He bought a loved one an electronic Walmart gift card for Black Friday, because nothing shows you care like cash equivalents do. You’d think delivery of an electronic card would be simple, but for Odysseas it was anything but. For a company whose logistical prowess is world-renowned, Walmart dropped the ball this time.

We hadn’t heard from Jim Wang at Bargaineering for a while, but he’s back with a post on credit scores and how they impact the interest rates you might pay. Until Fair, Isaac & Co. make the credit score formula available to the public, we’ll have to keep guessing as to what makes a good score.

The recondite Paula Pant at Afford-Anything brings it again. Go to her blog, now, and subscribe to her feed.

Here’s why she’s good. She wrote about wealth vs. happiness this week, and unlike the 805,394,217 other people who have written on this topic, she doesn’t offer up some pablum about how money can’t buy you happiness, be thankful for what you have, no dollar amount can compare to the smile on a little child’s face, etc., etc. Instead, happiness is correlated with…well, if we don’t tell you here it’ll force you to click on the link and read her post.

Aloysa at My Broken Coin claims that “the best things in life should not cost you a thing.” But they do. Or, as a former Control Your Cash Man of the Year put it:

 

Turning 180º, you can’t accuse Daniel of Sweating the Big Stuff of breaking out clichés. He argues that doing what you love for a living could be a bad thing.

At Control Your Cash, we’ve distilled the secret to wealth into two sentences: Buy Assets. Sell Liabilities. Do that often enough and you can’t help but build wealth. Free Money Finance did the same thing, with different (but equally valid) sentences. Check his version out here.

Tim Fraticelli at Christian PF thinks it’s possible to negotiate without losing your soul, or your shirt. We’d add “determine what the other party wants” to his list of 4 tips.

Suba at Wealth Informatics thinks Christmas gifts are a waste of time and money. She’s right, and we write basically the same post every year, but hers has way prettier graphs.

This week’s Trent Hamm Memorial* Obvious Sentence Award goes to Kevin McKee at Thousandaire:

My mother has four siblings (my aunts and uncles). 

Thanks, Ace. Anyhow, Kevin hits on one of our favorite topics this week: whether entrepreneurs have it better than corporate employees do.

Darwin’s Money comes with something so depressing, we almost didn’t want to run it. We wanted to fly to his house and give him a hug. He and a partner bought a rental unit, dotted all their j’s and crossed their x’s, then had their parade rained on by a zealous (and we’re thinking, extortionate) insurance company.

Time for our in-depth deconstruction of the week. Our victim is Hank at Money Q&A, who offers advice in “Four Places to Find Great Stocks To Invest In” that swings between curious and horrible.

I routinely can look on my desk and the desks of my coworkers to find the products of great, quality companies to invest in.

Hank also thinks you should look for investing ideas from your kids’ toys, your kitchen, and the mall, which is not only a careless way to write a post, but insane. This is Barbra Streisand’s investing strategy. (She once said, “We go to Starbucks every day, so I bought Starbucks stock.”) Hands up, every GM vehicle owner who bought GM stock in 2009. Here’s Hank’s best line:

Have you seen the explosion of True Religion jeans? If you had, then you would have been in on one of the great growth stocks of the past year or so.

Really?

Yes, TRLG’s stock has risen 50% in the last year, so you can add Hank to the list of retroactive stock market millionaires. But does he think we should buy the stock today? It trades at 19 times earnings. The company lost $44 million (on revenues of $364 million) last year. And in a recession, $300 douchebag jeans are among the first things people cut out of their budgets.

Corey at Money Reasons goes confessional this week, acknowledging that his wealth plan might not be unassailable. He’s got at least a couple of backup plans ready to go, and an irrational fear of being defrauded by someone like Bernie Madoff. (If someone like Bernie Madoff has even partial control over your money, you’re already rich.)

Alright, back to the horror. Miranda at Financial Highway has 4 ideas for earning extra income, all of which are impractical and none of which any sane person will ever try. Wait, didn’t we goof on this submission already? Yes, we did. She sent it in 2 months ago, and we tore it to shreds that time. If she wants to come back for more, who are we to deny her masochistic fantasies? Anyhow, her idiotic suggestions:

1. Offer to deliver pizza, sodas and cookies to college students between the hours of 10 pm and 3 am. Yes, because the kind of students who are awake to eat junk food in the middle of the night are rich enough that they’ll pay someone else to bring it to them.

2. Scrapbooking for other ladies. As Miranda puts it,

They can bring over their photos, and you can put them together, in an attractive and memorable presentation.

We average only half a vagina between us, but we thought the whole purpose of scrapbooking was to immerse yourself in an activity while your husband’s at work and your kids are compromising your sanity. Are we at the point where we’re now farming out hobbies? Why not hire someone to golf or fish for you while you’re at it?

3., and this is the most ridiculous one of all:

(Y)ou can purchase portable toilets that can be rented out. Instead of just renting them out, though, you can make them a little bit nicer. Clean them up. Add air fresheners, include nice soap and lotion, fluffy hand towels, and decorate the inside. These nicer portable toilets could be rented out for upscale outdoor events like weddings, company parties and special receptions.  

A free copy of Control Your Cash: Making Money Make Sense to the first person who can show us evidence of a portable toilet whose purveyor lined the inside with decorations and “fluffy hand towels.” (Miranda: “You see? That’s my point. No one else is doing it! The market is all yours!”)

Portable toilets run about $800 apiece. To do this you’d need to buy multiple ones, and you’d need somewhere to store them. And a way to transport them. And…oh, for God’s sake, we could write another 326-page book just on what’s wrong with this idea.

Let Miranda’s post serve as a warning: if you’re going to submit to the Carnival of Wealth, step your game up. Merely writing the first thing that pops into your head will either get you rejected (if you’re lucky), or will get you published as an example of everything we’re not looking for.

That might be the single worst piece of advice we’ve ever seen. To truly grasp the absurdity of her post, don’t just read our summary. You really need to behold it in its original splendor.

And once again, thanks for letting us put this together. Let’s do it again next week, y’all.

 

*No, he’s not dead. But he is overweight.

Filed Under: Carnivals Tagged With: , , ,
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