Should Balloon Boy's Parents Have to Pay Up?
The nation - or at least the cable news outlets - was captivated last week by images of what was thought to be a six-year-old boy flying thousands of feet high in a homemade balloon.
But was it all a hoax spearheaded by the boy's father, Richard Heene? The local authorities think so and are investigating.
News reports indicate that Heene may have pulled the stunt to snag a reality television show.
I am amazed at the number of people who think showing their ugly, gross, stupid, triflin' or ridiculous side on reality television is a way to prosperity.
The sheriff has indicated that he plans to seek reimbursement from the parents for the cost of the rescue attempt. So, this week's Color of Money Question is: Do you think the authorities should make the Heenes pay for the search for their son if this was, in fact, a stunt? Send comments to firstname.lastname@example.org. Please put "Heene Hoax" in the subject line.
Book Club Chat Today
Join me today for a chat with Noreen Perrotta, editor of Consumer Reports Money Adviser, a monthly newsletter that offers great personal finance tips. The newsletter was the October's Color of Money Book Club pick.
Submit a question now or join us online today at Noon ET. If you can't make the chat, read the transcript!
Banning Cell Phones At Work
As last week's the Color of Money Question, I asked if employers should ban workers from using their cell phones on the job.
Here's what you said:
"I hate it when I see employees obviously enjoying their calls when their desks are filled with paperwork, the store is in disarray, the checkout lines are long or their customers cannot get their attention for assistance," wrote Rina Lerner of Wayne, N.J. "When I am the customer it's all about me and I want 100 percent of the employee's attention."
Betsy Gorman of Big Flats, N.Y. says, "Hate to sound like a meanie, but I vote for banning cell phones at work. Probably one in 500 calls are true emergencies."
"I think we have forgotten what a true emergency is," says Sheri Wallace of Severn, Md. "For 100 plus employees, we don't get many emergency phone calls."
Jeanne Distretti of Memphis, Tenn. feels some leniency is in order. "We have many single moms employed as medical assistants," she said. "I initiated a policy that said there could be no cell phones in patient care areas but I tolerate a phone on vibrate if the employee goes to the break room to answer/return the call."
E. M. Taylor of Clinton, Md., says, "companies should have a policy in place that allows personal calls through their switchboard, office clerical help or individual employee phones."
N. Thompson of Kernersville, N.C. doesn't believe cell phones should be restricted at all.
"Are a few bad apples spoiling the bunch?" says Thompson. "This is the desperate act of a very weak management team who lacks the maturity and professionalism to deal with the bad seeds. I'd love for them to block my sick child from calling me. Better yet, if my child missed a bus or was stranded and could not contact me because my employer prohibited it, I would hire an attorney so fast it would shock them."
Is Layaway Better Than Credit?
I was also interested in what you had to say about layaway, which is making a comeback. But is it better than credit?
Here are some of your replies:
C. Ivey of Bowie, Md., says, "I think layaway, though viewed as something 'poor' people do, is a wonderful way to avoid high finance charges. I wish more stores would bring it back, but kudos to Kmart for keeping it around, they're getting my business for Christmas this year!"
Teresa Woods of Omaha, Neb., wrote: "No interest and it's a good hiding spot so that your children won't find their presents until Christmas!"
Rhonda Tsoi-A-Fatt of Washington, D.C., says layaway gives people options. "During the holidays especially, I've seen long lines at these payday loan companies, as people try to get money to pay for gifts for their children and loved ones. It's easy for well to do people to sit back and judge and say, 'well they shouldn't spend more than they have.'"
"My mom was so old school that she thought even layaway was a bad idea," wrote Karen Roeger of Fort Wayne, Ind. "If you don't have the money for it, then you shouldn't be buying it in the first place."
Jeannie MacDonald of Portsmouth, N.H., says, "Perhaps delayed gratification is worth something beyond just providing greater cash flow. Frankly, I barely remember what gifts I received last Christmas because they're opened and added to the pile of stuff around our house. Waiting to take a purchase home seems to raise a person's appreciation for it. Take that, credit card companies!"
Yeah! Take that.
But seriously, layaway is useful because it prevents credit card debt, but, on the flip side, it still doesn't prevent overspending. Just keep that in mind.
When the recession hit, consumer spending stalled. But with recent talks of economic recovery, many people are itching to shop again.
In Frugality falling out of fashion?, Annie Gowen explores this trend, writing about people who have ended their financial fast to shop again.
Personally, I'm with commenter "AndrearKline" who wrote in the comments section of Gowen's story: "When these people end up in Michele Singletary's column as deeply in debt-please don't expect sympathy from those of us who would never buy a $695 purse."
Leftover Chat Questions
I'm always sorry I can't get to everyone's questions during my online discussion. So here are two questions from two people trying to recover after being unemployed:
Q: My husband was unemployed for a year. He is finally returning to work. I kept things going -- paid for everything for a year. I made it, but didn't save anything for a year. We have always kept our finances separate, except for one credit card. He has enormous credit card debt and student loans. I have some credit card debt, but nothing outrageous. What's the best approach to tackling his debt and move forward? Do I have an obligation to help pay off his debt? I would really like to start saving again and would love getting some help on the mortgage, utilities, groceries, etc. On the other hand, I want him to be financially healthier.
A: I counted six times you said "I." Let's start there. I know lots of couples believe in keeping separate accounts and paying their bills separately. For many it works. For many it doesn't.
This is a "doesn't" case. I know the divorce rate is high. I know people keep their money separate out of fear of separating.
But look at your situation. It's all about what you want. What you need. What you are worried about. How about putting some "us" in this situation? I bet you both kept things going during your husband's unemployment stint unless he completely abandoned the family. If you (or your husband) were a stay-at-home spouse, wouldn't the income of the spouse working outside the home belong to both of you? Wouldn't it or shouldn't it be considered the family income?
So get off this "I" bandwagon and conquer your household credit card debt together. His debts are keeping you both down. Your separateness is keeping you both from prospering. So to answer your questions:
1. What's the best approach to tackling his debt and move forward? Combine all the debt that you both owe and start aggressively paying down on the debt starting with the lowest balance. On all other debts make the minimum credit card payment. Once you've paid off the debt with the smallest balance, move on to the next debt on your list. Doing it this way often gives people a psychological boost that helps them stick to their payoff plan. So, all extra funds you can muster up go to the debt at the top of the list. Do this for all the credit card debt, as well as the student loans.
2. Do I have an obligation to help pay off his debt? No, if you did not co-sign for any of your husband's credit cards or student loans, you do not have an obligation to pay them off. But you did sign up to be his wife in sickness and in health, for richer and for poorer. Think of this as a problem you both have and that two are better at getting rid of this debt than one.
3. How do we start saving again and get some help on the mortgage, utilities, groceries, etc.? Just as with your debts, treat ALL the household expenses as if they really, truly belonged to both of you, which they do. So combine your incomes - his new, your old -- and come up with a joint budget to deal with the household expenses and the debts.
As my husband says and I write in my second book, "Your Money and Your Man," one plus one can equal more than two--when you work together.
Q: My financial situation recently improved (got a job!) and I am paying down debt and saving money. I'm feeling some outrage though that we are always encouraged to save money, but banks are paying 1 percent or less on the accounts. I just checked bankrate.com, and there is one bank in my area that pays more than 1 percent without a large minimum balance or punitive monthly fees. How are we supposed to build our savings as a nation when the banks are almost making us pay for the privilege of letting them use our money?
A: Financial institutions not playing fair?
It's not fair that we get so little for the money we deposit for safe keeping at our banks and credit unions. But if the savings rates were higher that would mean the cost of other things for go up - loans for cars, homes, etc.
The way I deal with the low rates is to not think of my emergency money as money that has to grow or get a great or even good return. It really is your safety cash and depositing in the bank is safer (as long as you stay within the FDIC limits) than putting it under your mattress.
For deposit accounts, just keep enough cash to build up your emergency fund and your life happens fund. The latter is something I created to pay for the things in life that happen -car repairs, unplanned medical expenses, etc.
You can stay mad, but still save.
Charity Brown contributed to this e-letter.
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