This isn’t your grandparents’ recession.

Image by Ingrid Felix Victoria from Pixabay

(Happy Throwback Thursday! Given recent inflation rates, and some pundits’ responses to the very real struggles that some people face, I thought this post needed re-saying. It first ran on April 25, 2011; a version of the piece, written by me, originally appeared on MSN Money’s Smart Spending blog.)

When the going gets tough, it’s tempting to invoke our grandparents and their tribulations during the Great Depression.

I’m about to commit cultural heresy: A lot of their advice wouldn’t help us.

My paternal grandparents, who were 17 and 18 when they married in 1935 and had a baby the next year, knew an awful lot about living on an awful little. They’d make most of us modern frugalists look like Rockefellers.

But allow me to point out an irritating fact: The world was different then. When you look at our grandparents’ lives in context, you’ll see that it was easier to manage on relatively little. Not more comfortable, or more fun – just easier.

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Monday miscellany: Cheapest ways to be dead.

Recently a friend of my daughter’s suffered the unexpected loss of a family member who lived in another state. Her friend’s mother is unemployed, and the friend herself doesn’t earn much money. Abby offered “to do what I do best: comparison shop to find them the best deal.” The best she could find had a … Read more

A chance to meet a reader.

During the no- or low-spend February challenge, a reader named A. Marie mentioned she had been interviewed for the “Meet a reader” feature at a site called The Frugal Girl.

(That interview can be found here, if you’d like to go learn more about the awesome A. Marie. Go ahead. I’ll wait.)

Now: Who else is interested in being interviewed?

Yep, I’m appropriating The Frugal Girl’s idea. In part that’s because it sounds like great fun. After all, one of my favorite things about being a writer is getting to talk with people, and I’d love to chat with some of you in real life. (Well, over the phone.)

In fact, I have chatted with some of you in real life, during my travels, and it’s always stimulating.

The other reason I think “Meet A Reader” will fit here is that you folks tend to start conversations in the comments. Seems you’re already meeting readers, in a sense, and bringing us into the conversation. So why not make it official? 

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How to avoid overdrafting.

It can be surprisingly simple to bounce a check – and overdrafting can put a serious hurt on your finances, especially if you’re living on a tight budget. That’s because banks and credit unions can legally charge non-sufficient funds and/or overdraft fees multiple times per day. The Consumer Financial Protection Bureau recently reported that bank … Read more

Credit card requirements easing.

The good news: Banks have lately made it a bit easier to get a credit card.

The bad news: Banks have lately made it a bit easier to get a credit card.

According to the Federal Reserve’s new quarterly survey of bank senior loan officers, nearly 15 percent of large banks and 25 percent of other banks have eased the required minimum credit score in the fourth quarter of 2021. This trend is likely to continue in 2022.

Notice that not all banks are doing this. Notice, too, that I said it’s both good and bad news.

The relaxing of standards could help people who don’t currently qualify for credit, or who qualify only for cards with lousy interest rates and lots of fees. Getting a legitimate card and using it carefully can help them build their credit history. Without a solid credit history, you’ll pay more than you must for things like car loans, vehicles and insurance.

The idea is to get the best possible card and, more important, to have a plan to build credit, not create debt. That’s the “bad news” part: Being able finally to get a card could harm someone who doesn’t have a plan in place. A credit card is not the ticket to the good life, with zero consequences attached. It’s a tool, and like any tool it can be used for good or for ill.

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Monday miscellany: Porch pirates edition.

It’s not enough that inflation and supply-chain issues are putting a crimp in preparing for the 2021 holidays. Those dirty rotten porch pirates are back in business, too. According to a study from SafeWise, more than 60 percent of U.S. residents have had a package stolen in the past year. Obviously the holidays are prime … Read more

Financial gifts.

A fellow named Brandon, of Rinkydoo Finance, posed this question today on Twitter:

“What’s the kindest thing anyone has ever done for you financially?”

The expected “parents paid for college” answer popped up a few times. Other responses were things I’d consider not mere kindnesses, but rather enormous advantages:

“Gave us $10k cash for a honeymoon. Loaned us $100k at 3% to refinance my wife’s high-interest student loans.”

“When they purchased my business.”

“Someone anonymously donated $13,500 to my brother’s medical fund when he was battling brain cancer. Never found out who it was. (The number was just under the gift limit for the year so they would not need to file any paperwork with the IRS.)”

Here’s mine: 

When I was a 21-year-old unmarried mom, preparing to move from rural New Jersey to Philadelphia, an acquaintance took me out to lunch. He asked how I could possibly keep the baby and myself alive on my “permanent part-time” salary. So I laid it out for him: I make X dollars an hour, rent and public transit pass are X dollars a month, child care is X dollars a week, I just bought a scrub-board and we’ll eat a lot of beans.

Then I excused myself to the restroom. When I came back, he’d paid for the lunch and said, “Well, I have to be going.” After he hugged me goodbye, he put a slip of paper in my hand. Unfolded, it turned out to be a check for a month’s worth of child care. Immediately I said, “I can’t accept this!  It’s too much!” 

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Free weekly credit reports offer extended.

During the pandemic, the big three credit reporting bureaus offered free weekly credit reports through April 21, 2021. Normally each of the bureaus – Equifax, Experian and TransUnion – would give you one free credit report each year. The pandemic changed that.

And continues to change it: The bureaus have committed to making a free weekly credit report through April 21, 2022.

While the extension is a response to the continuing financial issues caused by the pandemic, you don’t have to be in dire money straits to check your report. It’s a good idea to make sure there’s nothing on there that shouldn’t be.

Recently I checked my Experian credit report and found an error. According to the report, I’d had a certain card since 1976. Except that no, I didn’t have a credit card at that time. I didn’t get my first card until about five years later.

I challenged the information and Experian was all over it. I got an immediate note saying, “We’re looking into this, sit tight.” Soon after, I was notified that the incorrect info had been removed* and they were sorry it happened.

Mistakes happen – and sometimes they can be very bad for your credit. 

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Monday miscellany: WFH and PF edition.

(Edited to add: The Freelance Writer Academy now offers scholarships! See below.)

Almost one in four U.S. residents joined the WFH (work from home) club at least part of the time since the pandemic was officially called in March 2020. According to a recent Bankrate.com poll, more than half of those (57 percent) said that working from had a positive effect on their personal finances.

Among those effects: fewer lunches out, no commuting costs, less need to dress up and fewer impulse purchases. Some also didn’t have to pay for child care, although how they got much done with kids at home is a complete mystery to me.

In fact, one of the least-favorite parts about working from home was simply the distractions while they were trying to work. Those surveyed also said they missed interaction with coworkers, and cited fewer chances for salary increases and promotions while at home.

Their favorite parts: more freedom, family time and sleep.

It’s worth noting that a lot of those who did well with at-home work were already doing well. More than a quarter of those surveyed (28 percent) earned $40,000 to $80,000 a year and more than half (54 percent) earned $80,000 or more. 

 

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