Financial advice

16 Sep

This past week, we went to a financial advisor, and after giving her basically all the information she needs to completely steal our identities, empty our bank accounts, and raid our (rather small) savings pool, we now get to wait a few weeks before she comes back with the assessment. I am guessing that she’ll inform us that we’ll never be wealthy enough to get that pony I’ve had my eye on, much less the handcrafted, 10 bolts of awesome, Glaser Designs briefcase I’ve always wanted. The stables for my zorse is definitely out of the question. Plus, she’s likely to say that there’s no way we’re either mature enough or financially secure enough to have a kid, so we should definitely put that on hold for another 5-10 years (5 for the finances, 10 for the maturity).

Though this may not totally be true. A study by the USDA on Lifetime Expenditures on Children (careful there, that’s a .pdf I’m a pointin’ at) shows that even families with over $98,000 household income spend between $19,380 and $23,180 on their kids from birth to age 17. Now, that doesn’t include college. But it does include non-public education and child care. Of course, tuition for a year at Princeton is currently $48,580. Times 4 years, adjusting for 18 years’ worth of inflation, etc etc, we’re totally fucked.

Anyhow, it seems to me that my rustic knowledge of financial advising was captured here a couple years ago, and it hasn’t changed: reduce spending, passive index funds, diversified by broad “lazy funds” categories, don’t trust anyone whose job depends on their ability to hold on to your money. I would add that increasing the amount you automatically save every month is probably a smart thing to do.

Of course, we don’t do any of this. But you should!

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2 Responses to “Financial advice”

  1. Krista September 22, 2010 at 7:12 pm #

    I’d really like to know where it is that people get paid decent wages and have such low expenses related to all things kid-related. I’m not even going to get into the costs of formal education here, but swim lessons are $13/20 minutes. Milk is $5/half-gallon. And diapers… ay. So, really…. where?

  2. Peter September 22, 2010 at 8:36 pm #

    Well, to be fair, Honolulu and NYC are probably not the best bets for cheap babies. This 6-br, 4-bath, 6650 square foot home in South Bend, IN goes for $615,000. On the other hand, this 3-br, 4 bath, 5800 sq. ft apartment on Central Park South is reduced to $29.75M.

    But still, the median dual-family income, is $86,400, if the statistical abstracts can be believed. I’m just guessing that things are much cheaper elsewhere, by a lot. And that people don’t really spend much on their kids. Or else I’m just not getting it. Maybe they’re not using diapers at all, and letting their kids run around the backyard pooping on the plants? Swimming in the swimming hole is free? I dunno.

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