Jonathan Clements's Blog, page 51

Direct Dealings by Marjorie Kondrack

You can’t put 10 pounds of potatoes in a 5 pound bag, but all my life  I gave it a good try, and had a lot of interesting life experiences. I thought of ideas for a small, part time business venture that might provide a new opportunity to explore my creativity, with a flexible work schedule.

I got my chance— a neighbor invited me to a home demonstration party she hosted for a Beauty Consultant who sold cosmetic products.  I found it interesting and something I might have a natural  affinity for.  I was self-motivated and enjoyed meeting people.

The products emphasized skin care with a complement of a few basic make up items. They were quality products, attractively packaged and priced at an affordable mid-price range. But little did I realize I had wandered into a field known as Direct Sales. Of course I wasn’t aware of all the pitfalls—you don’t hear much about those, and sometimes it’s best not to hear.  Would any of us embark on anything if we knew what hurdles we would have to overcome?

The company, however, provided you with high level training and unlimited support.  They had a successful business model and I  learned from other consultants who  were kind, respectful, and helpful.  All I had to do was sell. Figuring it all out was the challenge, especially for someone who never sold anything before. A common mantra was “fake it ‘till you make it.”

I had my own little business; started with low investment capital, mainly to pay for my own inventory.  Customers sampled products, got individualized attention, and went home entertained, enlightened and satisfied. I  never touched the women who participated in the demonstrations but would walk them through giving themselves an actual facial.  They loved it.

It was an age thing too.  My most enthusiastic customers were around 40 years old—the age the first lines around the eyes begin to appear and aging becomes a reality.  Care of the skin becomes a priority.

Meanwhile, finding hostesses for the demonstrations was an ongoing quest. I had to be inventive there.  I developed several methods to assure enough bookings and I put everything I had into a given session.  Since my best candidates came from women at the presentation, I took advantage of the captive audience.

No matter the product or service, selling is selling—but first you have to sell yourself.  Everything depends on your resourcefulness.  A prospective hostess would size you up and decide if you were someone they would invite into their homes to meet their friends in an intimate setting.

I achieved a level of success and especially enjoyed the fellowship among the consultants.  But real success requires hard work and building networking relationships.  The real money was in recruiting  and training new consultants for which you received additional compensation, but that also required more time, effort and attention.

The demonstrations were held at night.  I  had to be on my toes at all times, never wavering in any aspect of product knowledge, and confident in my delivery.  Putting it all together required longer hours than I had anticipated.  I wasn’t making very much money.  But I gave it everything I had.  I learned to overcome obstacles and increased my level of comfort in speaking to a group.

Nothing, however, remains stagnant.  You either forge ahead and advance your position, or assess the future.  And my reality was that it was encroaching on my obligations at home—everything came in second to that.

Once you decide something is not really for you, the endgame begins. But I learned so much about the psychology of selling and human behavior, and met many interesting people who invited me into their homes, trusted and befriended me.

It was a positive experience which added to my personal development and provided invaluable insight in how to engage positively with others. I learned so much about selling and marketing skills. And I had some memorable adventures along the way—no regrets—But no Mary Kay pink Cadillac.

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Quinn’s super frugal experiment. Are you up for a challenge?

Five years ago I wrote a HD article titled Food for Thought. It was about all the food we waste and, of course the money as a result.

Yesterday I mentioned to Connie that we have things in our pantry and fridge we don’t even know we have. She was sure that was not the case. Today I pulled out a bag of candy and other goodies we had forgotten from Christmas. I’m assuming it’s from last Christmas but that is not a certainty. 

I went shopping this afternoon and picked up a few mini bagels. I usually freeze the ones we won’t eat in a day or two. Guess what, there were six already in the freezer. To make matters worse I discovered a container of cream cheese in the back of the fridge. It would go great with the bagels except it was a bluish green in color. 

With all this food in the pantry, the fridge and the freezer. I threw out a challenge. I bet we could live for a month on just what we have in the house. Think of what we would save on groceries and gasoline. There is even the possibility of losing some weight. 

Connie is not enthusiastic about the idea. But I have a plan. 

First we cut down to two meals a day supplemented by snacks from the good supply of popcorn and pretzels we have on hand.

We use everything in the refrigerator first, then the freezer and finally the pantry where an assortment of canned goods are stored with perhaps a little mixing of all three. 

We have boxes of pasta, ten cans of tuna (it was on sale) and an array of soups on hand. I could get creative with a few meals. Nothing wrong with an omelet for dinner either. We could bake bread or biscuits. I’ll make a turkey pot pie. Somewhere in the depths of the freezer there is turkey pieces lurking. I know there are bangers and white pudding I bought from England. I could use my new rice maker as there is a bag of rice in the freezer we bought in Charleston last year - along with grits. 

There is a virtual treasure trove of possible culinary delights about the house. 

I may not follow a budget, but I keep track of “best by” and expiration dates, so I will use everything in the most efficient order. Of course, there is the chance we forgot to add a date to something in the freezer or to label what it is, so surprises are possible. 

Sounds like a plan to me. Are you up for a challenge? No cheating, you can’t stock up in advance. 

This may be beyond just a challenge though, based on what’s happened to our investments in the last week, it could be a necessity. 🤑

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What Kind of Loss Is This?

On Tuesday, I underwent a partial knee replacement on my right knee. It was a necessary step after more than a year—perhaps longer—of persistent pain that disrupted my sleep and made daily walks nearly impossible.

But here’s the twist: while the surgery was meant to relieve my suffering, the post-operative pain is even more intense. Even with strong medication, it’s a new level of discomfort. And physical therapy? That promises its own form of agony for the next three months. After that, I’ll go through it all again with my left knee.

So, in essence, I traded a long-term, chronic pain for a sharper, more intense—but temporary—one. A lifetime of suffering exchanged for a concentrated period of hardship with the promise of relief.

What kind of loss is this? How do we define it?

And more importantly—doesn’t this feel familiar?

Markets experience pain too. Long-term economic drags, unsustainable trends, and financial misalignments eventually reach a breaking point. Sometimes, the market chooses to rip the Band-Aid off—an intense, painful correction in exchange for future stability.

Is that what’s happening now? Are we enduring a necessary, short-term pain that ultimately leads to a stronger foundation?

I certainly hope so. Because in both surgery and investing, the goal isn’t just to avoid pain—it’s to ensure a healthier future.

WDH

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Lesson Two From Taking Care of a 102 yo in Her Last Year of Life- Preparing Oneself for Death

In the final month of my mother in law’s life my wife felt like  her care was failing her mother.

First she was concerned that her mother seemed depressed. Her mother started not wanting visitors, she wouldn’t get out of bed one day when my son was visiting. She lived for social interaction, so this behavior was unusual. When she was downstairs sitting on the couch with us she spent more and more time with her eyes closed with a full back heating pad. My mother in law also started eating less and less going from 1/2 a bagel at breakfast to less than a quarter, and not wanting cravings such as Barnum and Bailey’s Animal Crackers. We were rightly concerned about malnutrition.

Eventually my mother in law refused to get out of bed. My wife and I, being medical professionals, were concerned about the possibility of bed sores, pneumonia, and blood clots from a lack of mobilization. We also noted at this time her blood pressure was getting too low so the only medication she ever took for this was decreased to the minimum dosage (pretty amazing).

While my mother in law was hospitalized for the final time I asked the nurse if she had any information about what we could expect to see/experience in the coming final days. We received a booklet entitled Gone From My sight-The Dying Experience by Barbara Karns, RN. To our amazement as we read the booklet we realized that my wife was not failing to care for her, but that her mother was in fact preparing for her death.

The second paragraph above describes preparations which occur 1-3 months before death, and the third paragraph describes preparations one to two weeks prior to death.

If we had this information before the sequence began my wife would not have felt as if she was failing her mother, but we could have had advanced notice of a naturally occurring process prior to death and we could have reluctantly embraced it.

Note:  Barbara Karns’ has a series of five booklets entitled End of Life Guideline Series which can be purchased on Amazon. This series could be invaluable to many of us older HD readers who are in the later stages of life facing the passing of older relatives, spouses, and ourselves.

 

 

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Finding Your Balance by Dennis Friedman

If I were 40 years younger, I might be rattled by the stock market selloff on Thursday, the day after the President's tariff announcement. Back then, I was living in a studio apartment above a garage on an alley, trying to make ends meet while saving to buy a home. My investments were mostly in the U.S. stock market and cash.

Today, Rachel and I find ourselves in a different place. We're a retired couple whose house is paid off, and our investment portfolio doesn't only consist of U.S. stocks; we also own plenty of bonds and international stocks that helped cushion the selloff yesterday. Our broad-diversified portfolio of 45% stocks, 45% bonds, and 10% cash will never earn us bragging rights in the investment arena, but it does give us a steely spine in times like this.

I’m not advocating for an asset allocation like ours because we all have different financial goals, time horizons, and risk tolerances. But this old-fashioned approach of investing in low-cost, diversified index funds spread across U.S. stocks, international stocks, and bonds seems to have worked for us over the years.

I don’t think anyone knows how long this economic upheaval will last, but I do believe we have enough cash and high-quality bonds to ride out this stock market downturn. More importantly, I sleep well at night.

At age 73, I realize there are other things in life that can be more unsettling than the horrendous selloff we just experienced. Losing your health or a loved one can put things in perspective when facing a down market, especially when holding on to diversified investments usually doesn’t result in a loss.

I admit we did make one emotional decision before the tariffs took effect. We sped up the purchase of a laptop computer and an iPad prior to the President announcing his tariff policy. But that will probably be the only thing we’ll do in this economic environment, other than rebalancing our portfolio to our target asset allocation.

 

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Hitting Repeat by Jonathan Clements

Earlier this week, I asked readers, “If you could go anywhere in the world on your next trip, where would it be? If you could savor any experience, what would it be?”

I didn’t offer my own response—because I didn’t have one. At this point, I don’t have a strong urge to go to some exotic locale or try some new experience. On the other hand, there are places and experiences from my past that call to me. But which would I most like to revisit?

When I asked myself this question, my mind raced through various turning points in my life—getting into Cambridge, joining The Wall Street Journal, the birth of my children, meeting Elaine. But probably because of my physical deterioration over the past 10 months, my brain settled on a 5k (3.1 mile) road race I ran in July 2007—an event that necessitated some plane tickets and race entry fees, but for which money really wasn’t a central element.

What made the race special? It wasn't pleasant, it wasn’t the fastest 5k I ever ran and it wasn’t among the dozen races I won over the decade or so that I was a fairly serious amateur runner. But the race was a family affair, plus the physical exertion was such that it’s seared into my memory. Indeed, I can remember the details of the race in a way I can’t recall any other I ever ran.

It was July, and I was down in Key West, Florida, visiting my father, then age 74, who lived there full-time for the final 15 years of his life. My two kids were with me, and my sister Tory drove down the Keys to join us. All five of us ran that day’s race, held as part of a week of events to celebrate Ernest Hemingway, who made his home in Key West—and made its bars famous.

I’ve always preferred morning races. This one, however, was held in the evening. The temperature was still a blistering 95 degrees when the race started, and the humidity was beyond oppressive. I’ve never run a race in worse conditions.

Almost immediately, the lead group of runners fractured. There was a dozen in the front group, and the second group—which is where I found myself—was about as large. I figured I was in 20th position and headed for a disappointing finish.

As we turned left off Whitehead Street toward the naval dock, the two groups came back together and I started working my way through the pack. After a circuit of the dock, I found myself in fifth place, sitting on the shoulder of a lanky, bearded runner, trying to match his pace. We left the dock behind and turned back on to Whitehead. There were six-tenths of a mile to go.

I gestured to the runner ahead of us. “He’s in third,” I said to my companion, who seemed far stronger than me. “You should go get him.”

“I’m cooked,” he said.

It was a reminder that I wasn’t the only one suffering. I grunted, picked up the pace and decided to give it a shot. I quickly found myself closing in on the runner ahead, who perhaps was also wilting in the stifling heat and humidity. I was tempted to sit on his heels and take a brief rest, but didn’t want to give him any reason for encouragement, so I accelerated.

For that final stretch, I had a feeling I’ve never had before or since—a sense that every muscle in my body was working in concert. It’s a sensation I can still recall. Sometimes, in my daydreaming, I’ll relive those closing yards sprinting down Whitehead. I finished third in 17:30, far from my best time, and yet I doubt I’ve ever raced harder.

Afterward, there was a post-race party in the garden of a nearby guesthouse that was one of the race sponsors. With the running over, the weather seemed a whole lot less suffocating and the evening turned magical.

I sat with my family by the sea, drank the free beer and watched the sun disappear. Less than two years later, my father would be struck and killed by a speeding driver. That 2007 visit wasn’t the last time I’d see him, but the memory also isn’t tinged with sadness, like some of my later memories are.

That brings me to today’s question: If you could relive any experience from your life, what would it be?

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Tariffs and our retirement assets

I searched and searched the forum for a post about what HD readers are doing in response to the effect of the uncertainty of tariffs on the stock market but I found nothing.  It’s as if the markets did nothing today.  So, please tell me what you are doing regarding your investments in the face of this unprecedented economic assault on the world economy by someone who just discovered the quaint notion of “groceries”.

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Today’s the Day!–Well, Sort Of (by Dana/DrLefty)

I've had April 1 on my calendar since last July. Today is the day I can apply for a July 1 retirement date from my university. It also happens to be the date I can apply for Medicare because of my 65th birthday on Aug. 1.

I knew how to sign up for Medicare and what to do because we just did so for my husband, who turns 65 in May. Last week, I reviewed the materials from the retirement webinars I attended at the university so that I'd be ready to go on April 1. I woke up early, all excited. Made myself get on the Peloton bike for 10 miles or so before settling down at the computer.

Finally, I poured my second cup of coffee and sat down to get it done. The Medicare sign-up went quickly and easily. (I was feeling a bit nervous about what I've heard about the SSA website with all the staffing and funding cuts, but it was fine.) After reading through the materials from CalPERS (our retirement system that provides our current medical care), we both applied for Medicare Parts A & B but nothing else yet. CalPERS will coordinate our benefits and we'll have the same plan we have now. My husband's already received his Medicare card and his IRMAA statement. We can upload those IRMAA forms to the CalPERS portal to be eligible for partial reimbursement.

I then started the retirement application process but sadly hit a snag. I checked a box saying I had reciprocity with another retirement system (I worked for two different state universities), and that meant that my application was automatically bounced to a manual review process by the local office. I can't proceed any further until they act on it, which should take 5-7 business days. What a letdown!

I have announcements all ready to go--my Facebook friends, the various university offices that need to know...but I'm going to wait until the application is completely submitted. Among other things, on Facebook I'm going to post a clip from the Eagles concert we went to at Sphere last fall. I love the Eagles. "Desperado" is my go-to karaoke song. "Take It to the Limit" is my absolute favorite. But at this particular stage, the third verse of "Already Gone" has been speaking to me, so I made a video of that part of the live performance and will post it along with my retirement announcement:

Well, I know it wasn't you who held me down
Heaven knows, it wasn't you who set me free
So often times it happens that we live our lives in chains
And we never even know we have the key But me, I'm already gone
And I'm feelin' strong
I will sing this vict'ry song
'Cause I'm already gone

Oh, P.S. Today is also my "last first day"--my first day of class for spring quarter, which will be my final one. I'm sure I'll have some nostalgia.

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I don’t feel comfortable being “wealthy”

I have been pondering over this post for several days. I fear it will be misinterpreted, but here goes.

I don’t feel comfortable being wealthy. Like it or not, justified or not, planned or not I meet the typical definition of wealthy. These days that seems a dirty word - even though I’m not near the eight figure mark let alone ten.

I just finished our income taxes and it actually feels like we did pay our fair share. We pay IRMAA premiums and tax on 85% of our Social Security. Don’t get me wrong, I’m not complaining. The good thing as I see it is, wealthy is better than being rich. 

The terms "rich" and "wealthy" are often used interchangeably, but there's a subtle, yet significant difference between them.

A rich person might have a high-paying job and live a lavish lifestyle, but their financial security could be vulnerable if their income suddenly stops.

A wealthy person, on the other hand, possesses assets that generate income, providing them with greater financial independence and stability.

Being rich is about having a lot of money, being wealthy is about having financial independence and security.

How do you know which you may be? I think it’s a feeling of security, but you can always measure yourself against the data. For example from the Federal Reserve on net worth. What their surveys show.

Ages 45-54 median $247,200 average $975,800

Ages 55-64 median $364,500 average $1,566,900

Ages 65-74 median $409,900 average $1,794,600

Age 75 +     median $335,600 average $1,624,100

So, if you exceed these numbers you might be wealthy. 

Investopedia has an article explaining net worth at various ages. Thomas J. Stanley and William D. Danko, authors of "The Millionaire Next Door: The Surprising Secrets of America's Wealthy" offered this formula as rule of thumb:

“Ideal” Net worth = Age X Pretax Income / 10

For example if your income is $60,000 and you are age 55, your ideal net worth according to these guys is $330,000. That seems mighty low to me. 

In many cases home equity will exceed that number. 

On the other hand, it looks reasonable when compared with the Federal Reserve data, but I wouldn’t call it “ideal.”  Actually, I don’t think it’s wealthy either. 

Does it all matter? To someone getting by on $45,000, earning $100,000 may be wealthy and so on. Some people with modest earnings may have accumulated a hefty net worth. 

In any case, there are better ways to be wealthy that don’t involve money. In that regard I feel we are well into ten figures. 

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Where Next? What Next?

Suppose money were no object. If you could go anywhere in the world on your next trip, where would it be? If you could savor any experience, what would it be?

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