Father Sez

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Conserving water in the household – it’s all a matter of attitude

Monday, December 22nd, 2008

The Simple Dollar wrote a nice post titled “5 simple water conservation methods – Do they save real money”. 

Of all our utility bills, our water bill is the cheapest. So even a 50% reduction in water usage would probably not result in a big deal in terms of real savings. Still, I feel that the thought process that goes into conserving water is a very strong and fundamental part of overall frugality.  

I was born into a household that had no tap water. We were lucky. My mother(and us once we were old enough to carry a pot ourselves) had to walk only about 300 yards to bring back water for cooking and drinking from the village drinking well. Occasionally we had to tag along to carry a pot or two ourselves. (My mother could balance one on her head and carry two more. It was usually about 2 – 3 trips a day. So conserving water was an issue drilled deep into our minds from very young. 

A tap in full flow. It would do its work just as well at half or less the flow. 

Not so for my children. They are used to the house with taps all over the place and gushing clean water coming out each and every time the tap was turned on. So my children do not have the same attitudes with water. 

The Simple Dollar has pointed out 5 simple ways to conserve water, one of which is to install a low flow shower head. I prefer to use low flow all the time we turn on the tap, when washing our hands, washing vegetables or anything. Turning the tap on full blast and washing just wastes lots and lots of water. If the tap were to be on low flow (i.e. turned on low), then the task might take a wee bit longer but save a ton of water. 

Muslims have to pray 5 times a day and each time they have to take ablution to cleanse themselves. And this process often results in tremendous waste of water. Just imagine the waste in a household such as ours with 5 children plus the 2 adults. In Ghana and Sudan, it’s the norm to use just a little bottle of water for one’s ablution. I think the Ghanaians and Sudanese and others from the dry Middle East regions probably think that Malaysians are amongst the most wasteful characters on earth.  

I yell at my kids every time I see them running the tap full blast. Imagine washing a spoon with the tap water running full blast. It’s enough to make a strong man cry!  

3 months of water gathering this way should be enough to instill good water conserving habits, don’t you think?

As I said earlier, saving water is not going to add big bucks to our savings, but it drives home the point of generally not being a wastrel. This attitude will play a very pivotal role in shaping our future lives.  

Picture Credits: Google 

A taste of cold turkey treatment …… a little at least

Monday, October 20th, 2008

Quite a bit has been written about internet addiction (a Google search turned up 4.9 million pages). Internet addiction seems to be ranked up there with other more punitive forms of addiction like gambling etc. 

To quote Louise Nadeau, a professor at Montreal University’s Department of Psychology:

“The problem isn’t widespread but we know of serious cases in which teenagers don’t leave the house, don’t have interpersonal relationships, and have been isolated in front of their computer screen for the past two or three years, and only speak in the language of the characters they play with in network video games,”   

 

And whilst I am not a teenager nor play any video games, it looks like I may be one of the characters the good professor is talking about.  Checking my mail, looking up the political blogs, reading the online news portals, and checking my blog stats 3 – 4 times a day sure seem sufficient criteria to put me in this classification of an internet junkie.  

To make us want to check the Net is a pull that is difficult to define. Certainly it is not important, much less urgent, yet there is this craving. I am a late starter. I think it was only in the late 90’s that I started using email etc. We were then in Ghana and not having phone lines in our house we had to use cyber cafes. So the use was not that prevalent.

When I returned to Malaysia in 2001, by then all office computers were hooked up and we were online all the time we were in the office.  Now we also have Internet at home. 

The following study by Kimberly S. Young of the University of Pittsburgh at Bradford on the same issue was published in 1996. So perhaps now the malaise is even more widespread and deeper rooted.

There have been times when I have gone without looking at the Net for a day or two. This is usually when I am traveling and the transit airports did not have facilities that were cheap. Perhaps the longest was the one week I spent in India when my mother passed away. Somehow I feel that week should not count. 

Now I want to purposely try a week without any connection with the online world.  I’ll be in Jakarta for the rest of this week. I’ll be coming back late on Friday night and on the Saturday we have a full day planned for visits to family and friends. I am going to Jakarta without my laptop (just swinging my arms like a tourist (as my old geology professor told a bunch of us after returning from a 3 day field trip)). So it will be about 6 days without accessing the Net.  I want to see how strong the pull would be.

I am confident that no important messages such as those requiring my services to resolve the world’s financial crisis or to settle the repatriation of the Nigerian princes untold millions in an African Bank will be missed as I’ll still have my cell phone with me.  

The only negative may be that my Reader Inbox will be overflowing and I may not respond to comments as soon as I should. 

Let’s see how this “semi medical” exercise goes.   

Note: 

No, my son and I are not at the above depicted stages yet. And we are sure we’ll never be. The pictures are from Google Images.

Getting a grip on sunk costs when doing a personal finance makeover

Wednesday, September 24th, 2008

One of my favourite personal finance blogs, Get Rich Slowly, had a great piece on the sunk cost fallacy. It’s truly good stuff and should be recommended reading for anyone of us intent on changing our personal financial positions. 

One common factor that should be present in almost anyone with a “not so good” personal finance situation would be some of the investments and purchases made in the past. Expenses that we thought (at that time) would be useful and pay for themselves   many times over. And many of these come with recurring costs. 

When we set out on changing our pf habits, these recurring costs are sometimes quite difficult to eliminate. The thinking that we have is…”Oh! We have already spent so much, how do we throw this away?”. So trapped in this thinking, we continue throwing away more good money after bad. 

Examples of these would be subscriptions to various clubs or societies for which we had earlier paid hefty joining fees, Timeshare purchases, purchase of a car with a high monthly instalment etc. 

GRS quotes from the book, Why Smart People Make Big Money Mistakes (and How to Correct Them). 

Once your money is spent, it’s gone. It has no relevance. To the extent you can incorporate that notion into your financial decisions, you’ll be that much better off for trying. If you’re debating the sale of an investment (or a home), for example, remember that your goal is to maximize your wealth and your enjoyment. The goal is not to justify your decision to buy the investment at whatever price you originally paid for it. Who cares? What counts, in terms of getting where you want to be tomorrow, is what that investment is worth today.

This is also a rule in management accounting, when financial evaluations are done to decide on issues like producing ourselves or subcontracting etc. Expenditure made and done with are ignored. The only things that matter are the future outflows. 

This was the rule that I used when we cancelled our club memberships (two of them) and our cable TV subscriptions. Now we have done the same with our Timeshare. Just cancelled the bloody thing and save the annual subscriptions that came with it. (Man, it did hurt! But time should heal all things). 

Sunk costs are just that. Costs spent and gone. Nothing that we do now will change that. What matters is what we would be spending in the future. Is it an expenditure that we  would make, now that we have a new mindset? Just ask yourself this. If the answer is no, then just cancel and be done with it.

I have.

Harsh economic times and rising number of scams – let’s not lose our hard earned money

Sunday, June 29th, 2008

As the present harsh economic realities sink deeper and deeper into our lives, we are forced to look harder and harder for ways and means to make our Dollar (or Ringgit or Yen or Rupee or whatever) stretch further. Frugal ways of living become the norm. Wants are tossed aside as we struggle to meet our needs. 

This situation also forces us to look out for ways to improve our income. We look far and wide for such opportunities and our minds may become more susceptible to “get rich quick scams.” 

I am not sure if there are any scientifically proven relations between rising scams, fraud and con jobs during harsh economic times, but it sure feels like it. 

The world has already been exposed to the Nigerian scams, or what is commonly known as 419 schemesVariations of these scams are now circulating over the Internet, seeking the gullible amongst us to invest or to pay some sort of fee in the promise of some untold riches.  

We, Malaysians have been exposed to a variety of scams. And some of us are still falling for them. 

Like this lady who lost a total of RM200,000 (US$ 62,500) in the belief that she had won RM90,000. 

And this lady who tried to ward away bad luck and ended up getting a lot more than she bargained for 

And yet another lady who fell for the “I am from your bank and I need your credit card as there is a virus in the chip” line.  

It seems that certain types of people are more susceptible to fall for scams. The victims are usually: 

-         married men, (despite the examples above)

-         have college degrees, (so education does not seem to be a major diferentiator)

-         more optimistic about the future,

-         earn more than USD30,000 and

-         those who rely on themselves for investment decisions. 

I also think there has to be an element of greed involved, in that the victims expect returns that are ballistic.  

There is a lot of skill involved in scamming. Those of us who have seen scam themed movies like “The Sting” can appreciate the amount of planning and precision that was put into the whole exercise.  

These scam artists are now armed with technology and throw their nets far and wide at negligible costs. Even if one or two victims are caught in the net and reeled in, the ROI’s the scam artists gain are truly phenomenal. 

As fears of economic depression gather steam the scam artists are going to have a field day getting their victims.

Over the last six months, I have been approached by: 

- a person who called my mobile number and claimed to be calling from our High Courts on some offence that I was supposed to have committed. Luckily our local papers had been carrying stories about such scams so I was able to get off. (The scam is to frighten the victim that they were being charged by the Anti Narcotics police and that all their bank accounts would be frozen. They would then be “advised” to transfer their money to a “safe” account, which of course would be emptied soon after by persons unknown.  

- a person who emailed me claiming to be working for a reputable London jeweller. She claimed that the jeweller was buying some cleaning fluids which could be obtained from Malaysia at a fraction of the sales price. She wanted me to be her agent so that I could buy the stuff and export it to her. 

- a person who claimed that his client, a philanthropist had died leaving a fortune and his will required that the money be given to another philanthropist. And that my name had been selected! 

I urge each and everyone of us to be even more careful now. When approached by people we don’t know (these days the approached are usually by text messages and email) offering fantastic investment opportunities…..just stay away. 

As bloggers we can also do something about these scams. We, too, can spread the word around. We can tell ourselves, our family members and friends about any scam that we run into and remind them that opportunities that are too good to be true are usually just that.  

Additional useful readings: -

a) Former con victim, Annie McGuire’s web page to help prevent fraud 

b) The FBI’s page on some common fraud schemes. 

Credit Cards Are Not Designed for Daily Living Expenses

Tuesday, May 27th, 2008

This is a guest post by Tisha Kulak who is a writer for Creditorweb.com, where she writes about credit card offers, personal finances and credit card matters.

Economically times are getting harder than ever. Nearly every aspect of a person’s basic needs have gone up in price and those living paycheck to paycheck may be considered lucky to make it from one paycheck to the next. Due to the increasing costs of so many things, consumers are being faced with tougher financial decisions.

Many families no longer have the cash needed to buy basic grocery items and necessities and ultimately turn to their credit cards to survive. Utilizing credit cards to maintain daily life is not a financially healthy situation.

However, many consumers have no other choice. They are using credit cards to keep the lights on and food in the refrigerator. The trend is becoming increasingly popular and equally dangerous. Credit card balances are going up but family income is staying the same. Many consumers are not able to even make the monthly minimum payments. By not paying more than the minimum each month, people are digging themselves in even more debt. Balances will take many years to pay off in full and average consumers typically have more than one credit card with an existing balance. Add into the mix a missed or late payment and the balance grows even more outrageous.  

The best thing for any consumer with credit card debt is to really understand how much they owe. When family budgets are stretched to the maximum and there is no good outlook for paying down the debt, turning to a professional financial counselor may be beneficial to avoid falling behind and ruining your credit score. Once you have fallen behind, it becomes all the harder to catch back up. It is also bad for the economy as a whole because consumer spending ultimately decreases as there just isn’t enough money to go around.  

For those who feel they can not survive without using credit cards to maintain daily life, there may be a need to seek financial support from the community or local welfare office. Check out programs to help with utilities, buying groceries, and other necessities in order to stay on track  Debt management companies may be able to help you pay down your credit card balances in a shorter period of time. They may also be able to work with you on a realistic budget to get your through the worse of your financial situation. Not seeking help when you need it will eventually make your debt even worse and it will stick with you for a long time.  

Credit cards were not designed to keep your family going each week. Responsible credit card use dictates that anything you can not pay off at the end of the billing period should not be charged on your credit card. Before you turn to credit to help you make ends meet, consider all other available resources first and only charge what you can afford.

 

Cosmetics – Is there a way to lighten this outflow from many a lady’s wallet?

Thursday, November 29th, 2007

Sometime ago we talked about preparing our children for the onslaught of advertising that they would face daily in their lives.  

Billboards, newspapers, magazines, TV, internet ads – the advertising industry is a mighty formidable one.  The basic premise is that without using or owning the product being advertised, we are inferior in some way…..and their product would fix this. 

There are many ads for some really useful products, but, many, many more needless ones. 

One big sector is cosmetics, and as parents of 4 girls, my wife and I have to address this.  

In the days of old, almost all cosmetics were based on folk remedies and very light on the budgets. Not anymore.  For a young girl starting off in her career, where she would be mixing with mature men and ladies, the pressure to look good (as in air brushed cover girl good) is incredible.

A significant part of the monthly budget goes into buying cosmetics. What about going back to the days of old?  Those days when home  remedies and natural cosmetics were the norm. The ladies of old were as lovely as any of the models that we see today on glossy magazine covers. 

Even some doctors are advising us not to spend too much on personal care products. Read the Frugal Duchess’ story on this here.  

Will my daughters even consider this option at all? How do we start?  

There are resources such as Indian Home Remedies and books like Natural Beauty at Home, More than 250 Easy to use Recipes for Body, Bath and Hair. 

I suppose this is something they have to be comfortable with. As parents, we just want to point out to them that there are other cheaper and possibly better options to just buying the latest cosmetic that is advertised.

Facing and overcoming advertising terrorism

Monday, November 12th, 2007

The Number 1 cause for a bad financial position is “living beyond our means.”  

And very often, the most likely suspect for this would be a  consumerist attitude of buying things that we can really do without, or could have gotten the same functional facilities a lot cheaper.  

Not surprisingly, the oil that lubricates this is advertising. (Another prime cause may be “peer pressure”). 

The advertising industry’s relentless targeting of the teenagers and even younger children, has raised a lot of eyebrows.  Punny Money has posted a well written post on this and has coined the term “advertising terrorism”, (most apt, don’t you think) to refer to the scare tactics the industry uses to get us to open our wallets. 

And if we open our wallets too easily, we should be on the road to living beyond our means…..a clear no-no. If advertising can make even mature adults buy things that we often end up not using, or regretting, imagine the effect on the younger generation.  

So how do we prepare our children to face this onslaught of advertising? This onslaught that makes them feel that without the product being advertised, they are inferior, or not hip, or whatever. 

This is not going to be easy.  When our children were toddlers, there were many a time, when the TV was used as a “babysitter”. Our children’s cravings for KFC, and for McDonalds are clear cut signs of the success of advertising.  

As our children grow older, the items desired and seen advertised become pricier. Fancy overpriced handphones, (some of which are advertised as fashion items), cosmetics, food supplements, cars and car accessories etc., will soon feature in the list of “must haves” of our children. 

Hence it is clear that we must take on the task of educating our children on how to objectively view advertisements.  

Ms. Susan Carney writes about “Why and how marketers target kids”. She says :- “Many ads focus on creating insecurity about something, such as appearance. They focus on convincing the viewer that they have a problem that needs fixing and then propose to fix the problem.”  Many kids unwittingly buy into this message and as a result end up being hyper critical of themselves as they feel that they do not fit a certain image that they believe is necessary for their happiness. 

We have to help our children become more critical viewers. Help them recognize what is behind the hard sell. Ask them to identify the theme the advertiser is using to connect with them. Ask them to point out the “need” that is being projected that the product promises to fill.” 

This makes a lot of sense to me. But how do we start doing this? These days, it is quite uncommon, I think, for the family to watch TV together. The availability of a multitude of audio and TV channels have created this divide. 

Perhaps we should start a family TV viewing day, with one family member choosing the program each week or month and analyzing one ad along the lines of Ms. Susan’s advice.  

Maybe we could set a permanent agenda in our Family Meetings, to name and to give reasons as to why a particular advertisement may actually in fact, be misleading. 

What do you think?   

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