Some updated personal finance thoughts, including dog day care
As a follow up to our recent discussion on the costs of owning a pet, I recently read that there is a new doggy day care facility opening in the Rochester area.
I was interested to learn, upon doing a little research, that, in August, camp bowwow.com reported that “As an undeniable part of millions of families and hearts, dogs have succeeded in claiming not just our free time and affection, but also a significant share of our paychecks. The U.S. pet day care market recorded a valuation of $1.12 billion in 2021 and has a predicted CAGR (compound annual growth rate) of 6.8% from 20222030.”
That translates to $2.02 billion by 2030 that pet parents will spend on doggy day care. I can't imagine the costs that some families may be paying who are paying for both pet and child care, but I am sure that it is a financial challenge.
Nevertheless, pets are family.
If cash is king, what about digital currency?
On another subject, I know that I talk about cash is king all of the time, maybe too much for some readers who say, “OK, I get it.”
But I am reminded of it all the time. Recently, following a presentation, a high school student came up to me and said, “I get the advantages of using cash as much as possible, but everything is going more digital, and won't we eventually have only digital currency?"
I agreed with him about digital payments, but said that I don't know about digital currency any time soon, however, I do read and hear about it, and it scares me.
I told him I will continue to pay with cash as much as I can, so that I can stay connected to my hard-earned money as much as possible and sometimes pay less. I agree that it is getting harder to do. For example, at many airports most concession stands are digital payments only. On the other hand,, I was driving back from a school recently and there was a gas station that was cash only. The gas was 15 cents cheaper than the two gas stations within view. So why not carry some cash to take advantage of opportunities like that?
In addition, I told him that, even though it is not a cash thing, I still pay my bills with checks, so that I can stay more connected to my hard-earned money, even though I know it is not always as convenient. It was a good discussion. While we are on the subject of paying by check, I recently heard a radio commercial which said if you pay for the item by check you would get a 3% discount. Following up on that commercial, that day I asked two contractors if they had a cash price and a charge price. Can you guess the answer?
Birds of prey on wedding days
On a different subject, as many readers know, I am a volunteer outreach educator for Wild Wings, a bird of prey sanctuary in the Rochester area, so I was very interested in a recent article in the Wall Street Journal about couples hiring birds of prey to be ring bearers at their wedding.
So much for those adorable little kids! Apparently, for $1,200 in some places, you can have a hawk or a falcon swoop down and land on the arm of the bride or groom wearing a falconry glove with the rings. You may need a little training but that certainly makes for an unforgettable experience. I think it is even better than hiring those college mascots that we have talked about.
Have a great wedding day!
Review your finances
Here is something I discussed with some high school students recently after a presentation.
Once a month make an appointment with yourself to review your finances. Put your phone away and no Netflix, just review where you are on your financial goals, your financial plan, your spending, investing and your budget, including updating it if necessary.
As we have discussed, many of us do this at tax time and at the beginning of the new year, but why not one or two hours a month? Could it ever be something that you would regret doing?
Why teach personal finance?
I had an interesting conversation with a substitute teacher after a high school presentation. She was concerned that some of the lessons, tactics and techniques I talk about are very difficult to implement in today's expensive, high-interest rates economy, so what is the point?
The specific lesson she was talking about is getting a 15-year mortgage instead of a 30-year mortgage like most people do. That way you will save a ton of money on interest and build equity sooner. Her concern was that too many young people can't even afford to buy homes today, so what are they supposed to do with that information?
My response was that the lessons on what I call ”How to use finances for you instead of for my friends in the financial industry” may for some be aspirations, especially at any given time in their futures, but it is important to be aware of them and to understand the benefits of implementing them. They include having a one-time, four-year car loan, and never have another car loan or car lease in your life. Also, avoid debt as much as possible, and if you have to go into debt, for something like an affordable mortgage or student loan, do everything you can to minimize the debt or the interest rate.
In addition, debt is not about the monthly payment, it is about the interest rate and the term, and anything you can do to lower the interest rate or shorten the term will pay you big dividends. Finally, the only good debt is debt that you can afford to repay and you have a plan to repay, and it is your plan and you did the math to assure it's affordable.
Will they hear this in adds from the financial industry? That is why I teach it.
John Ninfo is a retired bankruptcy judge and the founder of the National CARE Financial Literacy Program.