Archives For May 2012

May 28, 2012

We had a great time at my brother-in-law’s wedding in Kentucky this weekend. In addition to the ceremony and the reception, we explored Louisville and even took in some races at Churchill Downs.

On the face of it, it was just another great time with family and friends.  However, when I think about it more, there were some really funny things that happened… will one of them stick with us the rest of our lives?  How about the half-life sized piñatas that the bride and groom had made of themselves?  Or the story of one of the friends who had a little too much fun that night and whose wife won’t let him forget soon?  Or how about the lady who swung too hard at the pinata and sent the stick flying into the audience (no injuries to report)?!

Will I talk about these stories when I’m an old man?  (Ok, age is all relative since my nieces and nephews already think I’m an old man!)

There’s a good chance I will remember some of these stories, but that leads me to another question.  Why do we focus the majority of our time on things we’d never care to talk about when we’re older?

Using this weekend as an example, my in-law’s friends were at the wedding reminiscing over some great times they had 30+ years ago.  These stories sure as heck weren’t about how they received a killer promotion or sacrificed spending time with their families for their careers.  No, the stories were all about adventures and great times spent with their friends and families.  Adventures that are now passed on to future generations.

Are you spending your time on things you and your family will talk about for years to come?  Here’s the important thing, money isn’t even an important element to making the stories.  Some of my best memories from when I was a kid came with very little money spent… our many treasure hunting hikes through the woods, sports in the backyard, and swimming at the lake.  Don’t let money be your excuse for not doing things you’ll like to talk about.

Going on adventures is something I need to work on.  For the 8 years since I’ve graduated college, the corporate job has filled most of my time with stress, time away from home, and concern for the next promotion.  I need to do a better job of creating memories with my family.

Three years ago, I wrote a five-year letter to myself talking about what I’d hope to accomplish.  Now, I need to think more about how I’m spending my time and if I’m doing the things now that the old me will like to talk about.  The greatest part is that I’ll have a great group of friends and family to talk about our shared experiences with.

Of course, time goes by so fast and before we know it we’re the old men.  As the great economist and philosopher Adam Smith wrote, “A youth, too unassuming and too unambitious, is frequently followed by an insignificant, complaining, and discontented old age.”

Will the old you be happy with you?

May 24, 2012

As we discussed last week, kids cost a lot of money; this got me thinking about what I’d tell my kids (if I had kids, and I actually had the guts to be mean). I probably wouldn’t really tell them this, but…

1. You can’t be anything you want to be

If you could be anything you want to be, don’t you think all adults would be doing something way cooler than what they are doing now? Why the hell do we have trash men and accountants if we all could be what we wanted to be?! Seriously, do you think I wanted to be a Consultant when I was a kid? No, I wanted to play ball like Jordan or rock like Ozzy.

If you want to excel at anything, you’re going to have to put a crapload of time into it and stop whining about it being hard.

2. Sometimes it’s ok to lie

Remember when our neighbor asked if it was our dog pooping in their yard and I said no? Well, sometimes it’s ok to lie. Most adults do it, they just don’t fess up to it. Lying is essential to keep harmony in our society. You just have to be careful about getting caught because then people won’t trust you.

3. Most adults are full of it, don’t listen to them

Earlier I told you most adults lie; this brings me to my next point… don’t trust adults. Don’t trust the experts that tell you coffee is good for you and then days later change their mind. Any time sometime tells you, “I had it so rough as a kid”, tell them to stop their whining and get a life.

4. Your friend’s dad isn’t on “vacation”

That’s right, they’re liars too. His parents hate each other and would rather pay for two homes than spend one more second around each other. In fact, if it wasn’t for your friend (which they had on accident) there’s no way they would be together. American’s suck at picking potential spouses. Be smart like me and pick a great woman like your Mother (and I’m not a liar).

5. You’re going to get old, enjoy it now!

I’d take three months off every summer and enjoy a nap every day if I could too. Trust me, just because I can drive a car and can lift you over my head doesn’t mean my life is awesome. Treasure never having to do anything for yourself.

You can fall out a tree and be fine or sprint from a standing position without pulling a muscle. Treasure it. Seriously, I tore my Achilles playing kickball!! Don’t even get me started on not having to buy anything yourself.

6. People are crazy

Do you know why our neighbor has 27 plastic and ceramic squirrels of various sizes outside of his house? Well, neither do I… sometimes people are just crazy. Don’t think it has anything to do with you or that you can help them. Oh no, all you should do is avoid contact with him but occasionally hide his squirrels so he has reason to believe everyone is ‘out to get him’.

Besides that, enjoy life… it’s going to be great!


Each year the US Department of Agriculture publishes their report on “Expenditures on Children by Families“.  This report gives us the estimated costs of raising a child until age IMG_352317.  You know, the scary numbers we hear about it costing a quarter of a million dollars to raise a kid – not even including costs of college?!?

Well, it frightens me every time I hear the costs of raising a kid, but I decided to dive into to the numbers to see what they really mean (other than people with kids will be broke!).  There’s good news and bad news; which would you like first?  How about I start with the bad since it already sounds really bad!   The average cost to raise a kid born in 2010 to the age of 17 is $226,920 if you make between $57k – $100k.  If you make less than $57k, the average cost drops to $163,440; if you make more than $100k, the average cost skyrockets to $377,040!!

I’ll give you a second to catch your breath before I tell you the good news.  The good news is you’re probably already spending a lot of that money now even if you don’t have kids but plan to.  I’ll get into the full reasoning as I go through each section, but the major reason is people purchase bigger houses with the intent of filling them up with little ones… and housing costs account for 31% of total child-rearing expense.  Ignoring housing costs, it already brings our $227k down to $159k over 17 years!  Feel a little better?

When do we spend all of this money on kids?

As I pointed out earlier, the amount spent per kids varies widely based on income level.  Costs for non-discretionary items (foods, clothes, etc) tend to be pretty similar among incomes because you can only spend so much on Gerber baby food.  However, costs increase big time when you start looking at discretionary items (housing, education, etc) because people tend to spend a lot more money on these items when they have more money.  Take a look at how costs are incurred when reviewed by age and income level. (Add in expenses by family, food somewhere)

Family expenditures on a child by income level and age - USDA

Not surprisingly, the costs tend to increase as the child gets older.  One basic reason is because the USDA factors inflation into the cost equation.  However, costs also increase because the kids eats more and they want a car.  Oh ya, and maybe a cell phone, iPad, and a new computer.

When we take the average spent per year on kids by income group, it looks like this;   For those making:

– Less than $57,600 – spend $9,614 per year per kid

– Between $57,600 and $99,730 – spend $13,348 per year per kid

– Making over $99,730 – spend $22,179 per year per kid

The good news is many of these costs are controllable.  There’ s a reason costs vary so widely by income level… because they can.  If you only have $5,000 per year to raise a child, I’m sure you’re going to find a way to do it.  However, it’s also possible to let your kid cruise around in a Hummer stroller with 20″ wheels at a much higher price!

Where the heck is all of this money going?

As mentioned before, the biggest chunk of expenses on kids is from housing (31%).  The second highest expense item is pretty close between food and child care/education.  These two categories move inversely from each other because when the child is younger, child care and education costs are higher usually due to day care, but then they eat a lot more when they get older!  It scares me to hear how much some of my friends are spending on day care (over $2,400 per month for two kids); I see why some of them want to transition to a one income family.  My mom also said that we (four boys) drank 12-14 gallons of milk per week while growing up.   Wow, that translates to over $150 a month in today’s dollars!

Family expenditures by category and age - USDA

Transportation costs average $120/month per kid until the child gets older and then jumps to $125/month because apparently they want their own car.  I thought the jump would actually be higher but transportation costs were estimated by the percentage of total transportation relating to child-rearing, which the US Department of Transportation says is 59%.  These numbers may not account fully for the purchase of a new car.  On the other hand many of us bought our own first car.

Clothing stays pretty uniform for a kid at around $60/month (get it, uniform?).  This isn’t a huge surprise as I noted in a previous article that we spend $144 per month on clothes for the average family.

Does it matter where you live?

The short answer is:  Yes, the costs of raising a kid vary widely by region.  It’s highest in the Northeast  where it tops out over $16,000 per year at age 15-17.  It’s lowest in Rural America where it tops out around $10,500 per kid.   I grew up in Oklahoma where private Kindergartens and high aptitude preschools weren’t in vogue so we were definitely on the lower range.

In fact, many parents are taking out pre-college loans in order to pay for their kids K-12 schooling!  That’s one of the most ridiculous things I’ve ever heard… and I thought four years of student loans for college was bad!!

Family expenditures on a child by region - USDA

In Conclusion, maybe it’s not that bad

Not all of these expenses are going to be brand new for you for each kid.   You’re probably paying for many of them now, and the ones you aren’t already paying for are controllable to some extent.   Also, as you have more kids, the costs go down per child.  If you want to estimate how much you’ll spend per kid and additional kids, check out the USDA’s child cost calculator.

What do you think parents, are these numbers representative of what you spend?

Use the rule of 72 to figure out how long it will take your money to double at different interest rates. All you do is divide 72 by the interest rate and the product equals the number of years to double.

For example, if you assume a 10% interest rate, the rule of 72 work as follows:

72/10 = 7.2 years for your money to double

I like to use this rule to forecast how much money I’ll have for retirement. For example, if I assume I have 35 years for my money to grow (from now until age 65), it would double almost 5 times at a 10% return (35/7.2 = 4.86). That means $10,000 would turn into approximately:

Double 1 = $20,000

Double 2 = $40,000

Double 3 = $80,000

Double 4 = $160,000

Double 5 = $320,000

This is additional proof of why it’s important to start investing today and to consistently invest over the long term.

At 12% interest, it will only take 6 years to double (72/12 = 6), but at 2% interest, it will take 36 years to double (72/2 = 36)!!

I like the rule of 72 because you can quickly do the math in your head to see how long it will take your money to double. However, it’s not exact and it doesn’t work real well if you’re trying to factor in additional payments. If you want to see how long it will take you to reach $1,000,000 with different interest rates, check out this post.

After I graduated from college, most of my married friends became SINKs (single income no kids) or DINKs (dual income no kids). It’s a common transition for our generation because it’s expected that both sexes will have jobs when there are no kids in the picture.

Many of these individuals went on to great careers and some of the SINKs transitioned to DINKs. After rounds of weddings, it was time for the next stage for many… rounds of kids.

Some of the women in the picture had already established a great career with a nice income. They swore they’d never leave the engagement and excitement of their careers. However, for many this changed when their new family additions came along. So what happens when DINKs become SIK (single income, kids – no pun intended!)?

If you’re transitioning to a single income family, things are going to change and there’s probably going to be less money to go around (obviously).

Since this transition is a major life changing event for everyone involved, make sure both of you are on the same page. If you’re not, it will nearly impossible to pull off because you’re going to be moving in different directions. Sit down with your significant other to discuss your short term and long term goals. Does the spouse think they’ll quit work for a few years or until the kids are grown up? Is there work they can do on the side to earn extra money?

After you are on the same page, the next step is to figure out your current and future financial picture. Many of the steps of transitioning to SIKs is the same as taking control of your money. You have to figure out what you’re spending today and know how that will have to change when you lose an income.

Here are the main steps to take control of your money:

1. Complete a current assessment

2. Track your spending

3. Create a spending plan

4. Monitor plan and adjust as necessary

5. Save some money

6. Attack your debt

After you figure out how much you are spending today (step #2), the main modification you’ll need to take is with step #3. Instead of using your current income to create your spending plan, use your new single-family income to see if you can get your current spending in line with it. If not, you may not be ready to make the transition.

If possible, the best thing to do is to transition to the single income before the time to quit even comes. If you can live off of the single income for six months without digging into savings, you’ll be in pretty good shape. If not, you have more work to do. Additionally, if you’ve survived the six month trial with a single income, you’ll have six months of savings as well!

If you haven’t had the kid yet, you also need to think about costs associated with the birth. According to the Cost Helper, typical costs to deliver a child are:

– Normal birth, no insurance: $9,000 – $17,000

– C-section, no insurance: $14,000 – $25,000

– Both births with insurance: $1,500 – $3,000

Apparently the baby gets a separate bill as well, which typically ranges from $1,500 – $4,000

In addition, you need to think about how much the kid will cost you annually.  According to the US Department of Agriculture, the average amount spent on each kid varies widely by income level, but looks like this:

– Income less than $57,600 = $8,480 to $9,630 per kid

– Income between $57,600 and $99,730 = $11,880 to $13,830

– Income more than $99,730 = 19,770 to $23,600

Don’t be too scared, because 31% of this is your estimated housing expense increase because of the child. If you don’t plan on moving after the kid, then you should already be at this number. However, you’ll also need to factor in some of the other expenses into your future spending plan.

It may sound dark and ominous, but another thing to think about is that some of your expenses might be cut when one spouse leaves the work world. Some savings areas to think about:

– No more paying for full time daycare!

– Decreased food costs because you should be able to cook more and eat out less

– Decreased expense on work clothes

– Decreased expense due to no more daily commute

It won’t be easy to transition to a single family income, but it’s important to focus on the upside. The upside of course is that you’ll be able to spend more time raising the kids! Maybe you can even teach them the five things formal schooling doesn’t teach us! It’s going to be hard… but if you both really want it, it will be worth it.

Have you made a transition to a single income? If so, what worked for you? (remember by adding your comments, you’re helping a bunch of other people!)

May 10, 2012

Another minute ticks away, and I can’t help but notice the sun’s final rays retreating to lands beyond. The heat that must accompany a warm New Orleans Spring day as such is no consequence to me because of my air conditioned room.

I’m comfortable.

On easy street!

It’s Thursday night. I know I should write another article for my blog, but I just don’t have the energy. From the television, Alex Trebek enlightens me with new tid-bits of knowledge that will soon disappear from my mind like the minutes that tick away from my time.

I’m comfortable.

My legs stretch before me with an acceptable excuse that my left foot must be above my heart to discourage blood from settling in the foot of my injured left leg. If my foot hangs down too long, the discoloration in my toes remind me that my body isn’t working normally. My calf muscle which usually assists in sending the blood back to my heart is blocked from movement by the cast. It’s forced into inactivity to allow healing of my Achilles tendon.

It’s ok though, because I’m comfortable.

The inactivity in my leg breeds the inactivity in my mind. However, the inactivity of my mind doesn’t result in a discoloration of an appendage, it results in lethargy of my being.

It’s ok though because I have an excuse. I have to rest while my Achilles tendon heals.

But why does the inactivity of my body directly result in the inactivity of my mind? That’s it, it shouldn’t! However, our bodies and minds are undoubtedly connected and when we stop one, the other one usually follows.

I believe things happen for a reason. For too long, I’ve waited around in my comfortable corporate job and hoped to someday have something more. This was a hope that was only backed up by inactivity and no pursuit.

My legs have been stretched out before me while I ride my bike with my feet on the handle bars. I haven’t been chasing my dreams because I’ve been comfortable. Things have come easy, and I’ve proven to be a success at work. However, I’ve told my wife that I feel like I could do so much more.

And then my legs are taken out from underneath me. Literally. Many people have experienced this same thing through other methods – layoffs, down-sizing, or other health issues. It makes sense, if I’m not even using my legs to chase, why do I even need healthy legs? I can just continue to ride my bike with my feet on the handle bars and be comfortable!

My dreams of pursuing my mission can wait until I’m not so comfortable! Is the purpose of my life, to not do anything that challenges me to the point that I might fail?!

Can you hear my loudening tone??  Can you feel my intensity as I get worked up about this??  Can you feel me ready to give my BATTLE CRY??

Well guess what, it’s not me creating the excitement inside you right now. It’s not me increasing your heartbeat and increasing your anger for shelving that dream. It’s you.

Ralph Waldo Emerson put it this way, “The youth gets together his materials to build a bridge to the moon, or, perchance, a palace or temple on the earth, and, at length the middle-aged man concludes to build a wood shed with them.”

We embrace inactivity and comfort and are satisfied with our wood shed. If things are going ok with work, and we’re happy with our personal lives, we embrace it. There’s nothing wrong with it. I’m incredibly happy with my relationships, current situation, and I feel very fortunate to have my job. So why can’t I leave well enough alone???

Well, my legs already got knocked out from me once; I’m afraid the next hint will be even less subtle.

I fought the inactivity tonight. One step at a time. I didn’t realize these emotions were stirring in me until I forced myself to start writing. I wanted to watch my TIVO’d “The Daily Show” from last night, but instead I forced myself to write.

In The Call, Oz Guinness wrote, “What is undeniable is that when comforts and convenience sap our energies and idealism, inactivity secretes sloth into our minds like a poison in the blood.”

Take control of your money, use your job as a tool, and continue the good fight!

Football players are usually separated into different positions based on their skill set. If you are 300 pounds and can tip over a car by yourself, you’ll probably be a lineman. If you can throw a football over a mountain, you might be the quarterback. However, there is a very small group of players that are simply called “Athletes”. These are the players that can play many positions and can’t be called just one thing.

In “How to be a Consultant“, I list the five ways to get ahead in your career by working like a consultant:

1. Become self-sufficient by building your network

2. Every time you start a new project you must learn very fast about the client and the work

3. You must keep up with the latest technologies and best practices

4. Project lengths are short; typically 9-12 months

5. Have a skill set that is in demand

One common theme among all of these is the ability to adapt quickly to changing situations and to be able to play many roles. Who does this best? An athlete!

As with most of my ideas, I picked them up from someone smarter than me. In this case, one of my mentors (John L) uses the “athlete” analogy to describe strong performers at work. He prefers to recruit ‘athletes’ to work for him.

So what makes someone a work athlete? John describes them the same as most coaches would describe an athlete. He looks for athletes who can:

1. Run fast = someone who gets sh#t done and moves at a pace that far exceeds his/her peers

2. Jump high = someone who continually raises the bar in terms of goals, results, etc.

3. Throw far = someone who has strength, courage and determination to really put something out there… for some to get and others to catch

It makes sense, right? Who wouldn’t want a team full of athletes? Well, you have to be careful. Just as in sports, you need to be weary of the work athlete who thinks a little too highly of themselves. You know the person, they might be great at what they do, but they drag the whole team down. Unfortunately, most bosses will keep these people around because they’re afraid they can’t replace them.

In addition to finding athletes, John is also great at forming teams who don’t have these ‘cancerous’ players who bring the whole team down. This one is a little harder to quantify, but it’s all about attitude. We need to be team players because most of us are working in group environments.

The good news is that we’re able to increase our athletic abilities and skills. I’m pretty terrible at golf, but if I play enough and try hard, I’m pretty sure I can get a lot better! We can also increase our work abilities and skills in order to become an athlete. Check out my article on how to succeed at work to learn more.


April 3, 2012

Thanks Susan Cooper for creating this awesome graphic!!

Time goes by so fast they say.

You turn around, and it’s the end of the day.

A week, a month, a year goes by;

And before you know it, it’s time to die!

So enjoy every moment and treasure every breath,

Because one thing is certain, you’ll never escape death!

– Dan Meyers

May 3, 2012

At least I’ve learned a few things from my latest injury

I never thought I’d enjoy a shower stool so much… I thought pruning is what stopped me from taking long showers… instead, I think it’s just that my legs got tired!

Shower stool

When you have a cast on your leg you’re always allowed to wear sweatpants. Wearing sweatpants can make you seem athletic…

Sweatpants Athlete

Or wearing sweatpants can make you look homeless.

Homeless Guy Sweatpants

You be the judge!

Dan Meyers injured

I totally get life alert now


All steps look like this (even my the three steps in my house)!

Scary Steps