Money and Happiness

Having “The Visit” At The Holidays

For many families, the holidays are one of the few times when adult kids, parents, grandkids, and grandparents get to see each other. That time together might be the best time to have a planned “Visit.” There are two common topics for the Visit: 1) finances; and 2) health and home. Today’s post will deal with finances. Next week I will have a guest post from Monica Stynchula, LCSW and CEO of ReunionCare, about health and home.

Members of the Greatest Generation are notorious for keeping quiet about money. Yet, as they reach old age, their Baby Boomer kids begin to wonder, “Do Mom and Dad have enough money to live on?” “What if they need in-home care?” “What if they need to make modifications to their home?” “Did they really need those $5000 new windows, or are they being scammed and not know it?” “If I had to pay bills for them, where do they keep their money?” “What if they have money or accounts stashed somewhere and they forget about it?”

Some parents may discourage the money topic by cutting conversations about it short. Perhaps they do not want to acknowledge their own mortality. Perhaps they are embarrassed about falling victim to a scam already. Perhaps they see all of their kids as spendthrifts who will not be responsible (regardless of their age, education, and career status). Perhaps they are afraid of having the keys to their car, or their home, taken away. And it’s not always the parents that don’t want to talk about it. Sometimes the adult kids are uncomfortable talking about their parents’ mortality, and they are the ones cutting off the communication.

Regardless, every time the topic, and its underlying emotion, is avoided, it feeds an elephant in the living room. If not acknowledged, it stays there, and gets bigger, until a crisis erupts, and everyone is forced to talk about it under duress.

How do you bring up the money topic before a crisis?  Try owning your discomfort about it up front. “There’s something I am struggling with talking to you about,” might be a good beginning, for example. Then let them know what you want to talk about: “There are two main concerns that keep coming up for me, and I need your help.” However, if they still shut down, keep your cool, and ​be empathetic: “I​f I were in your shoes, I would find this hard to talk about, too. Perhaps this wasn’t the best time to bring it up.” ​Try writing them a letter instead to keep the conversation going.

​​But, ​if you find the discussion goes even better than you thought, let them know how relieved you are: “Wow, I was so worried about talking to you about this, but I feel better now.” You may find you have paved the way for more open conversation, and even happier holidays with the family, in the future.

3-Minute Video: Having “The Visit” At The Holidays

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When Going Over Budget is Good

Last week I looked at my income and expenses for the first six months of 2014, comparing them to the budget I made at the beginning of the year. One category had a big surprise – groceries. Everyone knows about supermarket inflation, but upon further inspection I realized my own personal inflation was due to some “bad” (financially speaking) choices I have been making for my own “good.”

In my newly single life, I assumed I would be spending about two-thirds of my old married grocery budget. Instead, I found that I have actually spent more. My analysis showed three reasons – 1) my healthier food choices; 2) my love of cooking, especially for others; and 3) general grocery inflation.

When I go to the grocery store now, I hardly spend any time, or money, in the middle aisles. I spend it on the perimeter, where the produce is. As a result, I have managed to keep off the ten pounds I tried for several years to lose. But produce is generally more expensive, and not quite as filling, as packaged goods and carbs, so I buy more of it. It also spoils, so I buy more often.

I have always enjoyed cooking, but now I have someone new in my life for whom I especially enjoy preparing meals (lucky guy, huh?). Upon reflection, he estimated I am buying 75 percent of the groceries for our two households. And he is probably right. I nearly always send leftovers home with him, then bring groceries to his house, too.

Relatively speaking, I would guess that eating healthier, and cooking for two, have far more impact on my cash flow than general inflation has. But I have no intentions of stopping either one. I will find other areas to sacrifice first. Compared to the cash flow impact, my much-improved health and wellbeing is far more worth it.

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At What Tipping Point Does Less Become More?

A reader recently discovered a terrific online financial resource – www.mrmoneymustache.com. Mr. Money Mustache controverts conventional thinking (or rather, lack of it) about spending and saving. The co-authors, husband and wife, reached financial independence at the age of 30 by saving aggressively in their 20s. They are raising their kids and spending time as and where they wish. They are by no means “deprived.”

Of course, “deprived” is a self-determined definition. Related to our self-definition of “deprived” is our self-definition of “enough.” What is enough for some might be deprived for others. What is enough at one point in our lives might be deprived at another.

However, even for those who by everyone else’s standards seem to have “enough,” defining the tipping point between enough and deprived remains one of the toughest parts of constructing a useful plan for their financial future.  (Our calculations would be so much easier if we only knew on what day we were going to die, and how. Once the human genome is mined sufficiently to provide that, financial planners will be out of business.)

In fact, the more work we do on becoming mindful of what is “enough,” the richer we become.  One reason is that our society encourages us to confuse consumption of “more” (more money, more stuff, more status) with the pursuit of enough. Unfortunately, enough becomes like the end of a rainbow – the closer we get, the farther it seems to move.  Was there a point in your life where you were on the path of acquiring “more,” but stopped and realized you had “enough”? Did you change direction? If so, did you then feel deprived? Or, was it not so bad, maybe even better, after all?

Ironically, our pursuit of more can often be accomplished by doing with less. Let’s look at three money behaviors and see how this applies.

1) In spending: Examining what fulfills needs, what fulfills comforts, what fulfills luxuries, and what becomes clutter. The tipping point between luxuries and clutter is where more unhappiness is caused to acquire, own, maintain, insure, upgrade, or sell something than happiness is created by having it.

2) In investing: Understanding the unhappiness caused by taking unnecessary risk, or costs and fees, in order to reach for return. The tipping point between appropriate and inappropriate risk happens when “enough” return has not been clearly defined and maintained with discipline.

3) In sharing: Discovering the satisfaction of having helped another human, free of expectations of reciprocity or thanks. The more we stretch to share in this way, the better we feel. The tipping point between a mentality of scarcity and abundance is one of the most difficult to define, which makes it one of the most gratifying to discover.

Finding our tipping points can be a little scary, like stepping onto a tightrope and wondering if there is a net. When we think about it, few opportunities to stretch ourselves come without a fallback plan. But many opportunities come with rewards we can’t yet fathom.

Share your “less is more” experiences in the comments here, or email me at holly@hollydonaldsonfinancialplanner.com.

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The Unexamined Life

Perhaps there is something about middle age that spurs the urge to examine. At my 25th college reunion a couple of years ago, I had breakfast with a friend I hadn’t seen since graduation. She works for our alma mater, Davidson College, and therefore had attended lots of reunions. She said, “At the 10-year mark, everyone’s kind of comparing notes – who has how many kids, who has graduate degrees, what they did for vacations, etc., but by the 25th, nearly everyone has experienced some kind of life event, and they are a lot more mellow. The other stuff must not seem as important.”

It does seem that there are points in life when we question what is important, and this begins a process of examining our own attitudes and behaviors. One of my first experiences with examined behavior change was through Weight Watchers. I was 35 and about 20 pounds too heavy. I lost 15 and kept it off. Twelve years later, I fluctuate between 5 and 10 pounds over where I want to be. I still call it a successful behavior change. How did I do it? Tracking and accountability. Whenever my clothes get too tight, I go back to the WW method of writing down everything I eat. If that ever fails, I will go back to the accountability of meetings. In the meantime, I have developed much healthier dietary habits.

Lately I have been examining healthier conversational habits. For example, “listening” does not mean “wait until the other person is finished talking so I can say what I want to say.” Listening means to suspend all noise and chatter in my head and simply absorb and reflect on what I am hearing. To eliminate the noise and chatter, I have a rule: anything that I want to say while someone else is talking, I am not allowed to say. Like any other habit change, it has taken conscious effort at first, but now is becoming close to second nature. When I think of something I want to say, I tell myself to let it go, be present, and listen. If it is that important, it will come back up again in its own time. Being completely present with people, when I am able to achieve that listening nirvana, is freeing.

It is easy to underestimate how difficult behavior change can be. We rationally believe, for example, that the next time, we will just tell ourselves to act differently, and we will. We may have every intention to say no to cookies after dinner, to quit interrupting, or to quit worrying about things we cannot change. The more parts of life I examine, the more I realize I could spend the rest of my life developing new habits and undoing old ones. Behavior change is hard, but rewarding. If done in tiny increments, it takes longer, but isn’t as painful. Before we know it, changing one behavior has brought about a little more happiness. Little changes, over a decade or two between reunions, end up making a big difference.

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