Almost Frugal » Notes On Culture

Economic Gardening And Personal Finance

Nicole — Thu, 10 Jun 2010 19:13:24 +0000

I had breakfast this morning with Sheila, a friend and one of my former bosses, when we got to discussing business and the entrepreneurial attitude in general. She then mentioned the term economic gardening, which I had never heard of.

The idea was developed in Littleton Colorado in the 80s when one of the area’s largest employers left town, leading to increased unemployment and an important question for the economic development people in the community: What do we do now?

Before this, economic hunting, or recruiting big companies to come to an area and create jobs, was what was done. In this new era, Littleton issued the idea of economic gardening, or growing the jobs within the small businesses in the community. This became a big idea not just for Littleton but other communities across the United States.

Whether you have heard this term or not, it’s easy to understand that this idea is more important than ever. Beyond business and economic development, it can be seen in personal finance and people’s budgets on an individual or family basis. People are growing their own jobs, saving small amounts of cash consistently, and otherwise thinking small moving towards big rather than having something big just show up.

Growing is harder work but in many ways, much more empowering. With growth, someday you will have what you are working towards versus hunting where you may never find it. In uncertain times, who wants to leave things to chance?

I think if you are reading this job, you are already economically gardening in your own life (or at least thinking about it). An isn’t it nice to know you can go on starting your financial life rather than wishing for your economic ‘prince charming’ (in the form of a perfect job or some sweepstakes to knocking on your front door with a big fat check)?

So whether you’re a business person or not, I thought this was a fun concept to know about. So what are you growing economically?

Economic Gardening And Personal Finance by Nicole | Permalink | 3 comments

When 50-50 Doesn’t Add Up

Nicole — Thu, 22 Apr 2010 20:43:03 +0000

Some Ideas About Sharing Expenses in a Relationship

I saw an interesting guest post at Budgets Are Sexy today about how a couple that lives together but isn’t formerly committed could financially work. The post discusses splitting things 50/50 and not combining accounts for shared expenses.

As a non-married person, this made me uneasy for several reasons. (Note: I am in a committed relationship and we don’t live together.)

In my relationships, I’m usually the lower earner, and this is not uncommon. According to Women Employed, 60% of low wage earners are women and 1/3 of the female workforce in the United States is a low wage earner (compared to 1/5 of the male workforce). If you want to look at a bunch of depressing/infuriating graphs about income disparity between the sexes, check out this study. And as my blood starts boiling, here’s me stepping off my feminist soapbox…

Regardless of which partner has less take home pay, splitting things 50-50 seems unfair to whoever is making less money. For example, I lived with a boyfriend who owned his own house and could not have afforded half his mortgage if I wanted to. That said, he had bought the house before me, and was unable to sell it, so if I had a shared role in the decision, I wouldn’t have chosen to live there. What we decided to do was have me pay the equivalent of 25% of my salary towards the mortgage, split the grocery bill, and have him cover the additional expenses with home ownership. Since my name wasn’t on the paperwork, this made me comfortable and he continued to get the equivalent of what his former roommate had paid in rent.

Some of my friends were appauled but the thing is, it was our relationship. We both agreed to the terms and this arrangement kept me out of the poorhouse.

Also another issue to consider is that most women do more household chores than their male counterparts, and these tasks are not compensated. To earn my keep when I lived with my exboyfriend, I did the dishes, cooking, and laundry as regular chores. We both spent an hour once a week cleaning the house together. So while I paid less as far as rent, I think I made up for it in other aspects.

In short, a 50/50 finacial split isn’t necessarily an equal relationship. Sure, having a rule like this avoids having to have the uncomfortable money discussion but discussing what you need and want sounds like a good opportunity to set some terms, financial and otherwise, that both people in the relationship can agree with.

While my current boyfriend and I don’t live together, he is at my house a lot. (He lives with other people and I live alone so it’s easier.) We don’t go out much because neither of us make a lot money. We mostly end up going for hikes, cooking dinner, or watching movies. So he chips in $10-$20 a week to help with household expenses like groceries and helps me with some chores like dishes and cooking. If we ever move in together or when things get more serious, we’ll re-evaluate but for now, we both think it’s equitable. He is also clear that I won’t live with a boyfriend again unless we’re at least engaged. If you like it, put a ring on it indeed!

This is, of course, my unique experience. I think living together can work if everyone is clear on the communication.

And not until I am married will I ever combine my finances. As the Budgets Are Sexy post fantastically put it:

“If he can’t commit and sign on the dotted line for our happily ever after, then he can’t be allowed to sign on the back of my credit card.” (You can see the Budgets Are Sexy post here.)

I’d love to keep the discussion going about this. So money when you aren’t married: Should finances be combined? And do you think 50-50 is fair?

When 50-50 Doesn’t Add Up by Nicole | Permalink | 9 comments

What Do You Think: Financially Sticking It To A Company

Nicole — Thu, 15 Apr 2010 21:48:55 +0000

As consumers, we now have a few venues to take out our frustrations with a company. We can tweet a complaint, to all our friends and directly to a company if we want. We can write on their Facebook wall, or reply to their latest newsletter. And of course, there are the traditional venues: writing a letter to the editor, calling customer service, or simply walking into the establishment and having an actual conversation.

Recently I’ve heard of a few ways people are financially ‘sticking it’ to companies in addition to or sometimes in place of complaining verbally.

My friend Nick sent me this link, which tells people how to mail heavy objects on the offending company’s dime in response to junk mail. In short, you tape a ‘no postage necessary if mailed in the United States’ envelope to the outside of a package filled with, say, bricks or something else heavy. Upon delivery, the company pays the postage. The website explains this is perfectly legal and the only way we will stop receiving junk mail.

Another person I ran into told me about his friend who Googles expensive keywords (I guess ‘pay day loans’ is one) and then clicks on the sponsored links of companies he doesn’t agree with, chuckling that he costs a sketchy business profiting off someone’s desperation for cash $10 for his click. (I tried to find a link for this idea but my brain doesn’t seem to be working well today.- If you have one, let me know and I’ll add it to here, and give you credit of course.)

In other words, we’ve gone from communicating to action, only some of these actions are costing the company we disagree with money.

While I do have a thing for great customer service and treating people well, I have a problem being outright mean. But are these practices mean, or sending that company a message that they don’t seem to be hearing verbally? Do people feel increasingly desperate in this economy and use these tactics to get some control back they feel they’ve lost? Am I too uptight?

So I’d love to know: Heard of other ways people are making companies financially pay for bad behavior? Do you think these practices are ethical?

What Do You Think: Financially Sticking It To A Company by Nicole | Permalink | 7 comments

Retirement Savings in France

Beth — Wed, 14 Apr 2010 11:04:45 +0000

When we left the U.S. six years ago, we had the beginnings of our retirement savings. I had participated in a 401k plan with my first employer, which I then rolled over into an IRA when I went to another job. It wasn’t a huge amount of money, but it was a start. My husband, as well, had put a bit aside through his own company plan.

An international move is a huge expense, and most of what we had we spent once it was converted into readily available cash. It went towards buying a car, new furniture, and putting a down payment on our apartment. Basically, we were starting over from scratch. Today, after five years with the same company, my husband has begun to build his back up, thanks to a modest company plan. But what about my retirement?

I’ve been working for the same employer for four years now on a yearly renewing contract. I have the status of a “contractuelle” employee, which basically gives you zero benefits (apart from our fabulous health care system, which I would have anyway regardless of my job). Of course, I automatically contribute to government pension (the equivalent of U.S social security), and back in the day that would have been enough to ensure a comfortable retirement provided I had worked my requisite 37.5 years.

Today, government pension isn’t in such good shape as it used to be, and as in the U.S. it’s important to have another plan for retirement savings. Since I don’t work for a company that offers me a savings plan, I have to figure out how to save on my own, no easy task in a system that is not geared towards private retirement savings.

In terms of basic savings plans, I have two options: fixed-rate accounts and the variable-rate accounts. The fixed-rate accounts, or CAT (comptes à terme), allow you to invest a certain amount of money for a given period of time at a guaranteed rate. The return is not staggering but it’s a sure thing.

If you’re interested in keeping money in an account for an indefinite period of time, a variable-rate account may be your best bet. Because we don’t pay much in taxes (contrary to popular belief, a very common phenomenon in our socialized country) we are eligible for a LEP account, which allows us to save up to 7700 euros each, tax-free.

The Livret A account is very popular and has only recently become widely available. It allows savings of up to 15300 euros per account. Accounts are available to children as well, so we could have as many as four for our family. When it first opened up to multiple banks, it was at a good rate; however, the rate has since gone way down and the return is now minimal (though only marginally below that of the LEP). But again, it’s a sure thing.

I’m not someone who likes to gamble with money—I like a sure thing. My husband is more of a risk-taker and ultimately, probably more realistic when it comes to our finances. At our age we need to take a few risks to make up for our slow start to retirement savings. In terms of stock market accounts, there is the PEA (plan d’epargne action) which can be opened in different forms depending on your portfolio. If held for at least five years, the capital gains are tax-free.

So what’s the best way for me to plan for my retirement? As someone with a minimal amount of financial knowledge, how can I make the most of my savings?

Note: As I’ve said, I’m no financial expert. Any mistakes or misinformation is entirely the fault of my own limited knowledge. However, this is the way the system works to the best of my understanding.

Retirement Savings in France by Beth | Permalink | 3 comments

Changing Habits and Going Against the Norm

Kelly — Mon, 21 Sep 2009 10:00:08 +0000

One of the ways that French people great each other is with a kiss (no, not a French kiss!). Depending on the region, you kiss each other on the cheek, or more correctly touch cheeks and make a kissing noise, two to four times. It’s called the bise (sounds like bees) and is short for bisou (bee-zoo), or kiss. Women do the bise to other women and to men, but men only shake hands unless their very good friends or family. Either way, there is always physical contact when people see each other.

To illustrate how important and pervasive this cultural habit is, I’ll tell you this story from yesterday. I was driving home from the grocery store and the car in front of me actually stopped, in the middle of the road, so that the driver could do the bise with a guy walking down the street. It’s like waving to people you know, but holding up traffic at the same time!

People just have the reflex to do the bise with others which is why, when you break the convention, it’s a bit disconcerting. I’ve been sick lately, and beyond not wanting to give others my cold, our new workplace precautions against the H1N1 flu bug advise against touching others. So no bise for me, which means that people have a bit of a jolt when I back away from them. “No bise? OK!” they say, waving their arms in front of their faces. “Pas de problème!” They agree, but they have to think about it for a minute first.

It’s made me think about how much harder it is to live the frugal life and try not to spend a lot of money when we live in a society that encourages such a large amount of consumption. There is a trend towards frugality at the moment, but I wonder how long it is going to last, when all we hear is: Cheaper. Better. Newer. More.

France isn’t quite as overboard as the United States when it comes to consumerism, shopping, buying and buying more, but the push towards buying and having more and more exists and is getting stronger. There are clothing store chains that have sales like ‘Buy one, get four free’ which adds a whole new twist to the BOGO offer!

I find it easier to be frugal when I’m with other people who are frugal. Many of my friends are also trying to save money, live within their means and so on. Part of this is due to circumstances (most of us have young kids, and don’t have the energy to do much shopping, let alone the money) and part of it is due to conviction (paying off credit cards= good; carrying debt= bad).

Changing the habit of spending money heedlessly is something that most of us have been working on for a while. We might not be perfect at it (not yet, anyways), but it’s getting easier, at least for me. I’ve stopped buying things online, stopped shopping as a hobby, started grocery shopping from a list. I don’t have expensive hobbies anymore, don’t buy DVDs or CDs, go out to concerts and movies.

There are still two big areas where I need to improve. The first is eating out at fast food restaurants, because I haven’t planned a real meal and we’re stuck for time (or I think we are, at least!). The second, is that little voice in the back of my head that says “It’s OK, you can always put it on the credit card and pay it off later.” I don’t, but like doing the bise, it’s a habit that’s hard to break!

And you? What bad financial habits have you been trying to break?

Changing Habits and Going Against the Norm by Kelly | Permalink | 8 comments

Going to the Doctor in France

Kelly — Mon, 20 Jul 2009 17:08:56 +0000

I know that this is a politically charged issue, and that it’s a risk to bring it up here on Almost Frugal, where I really try to stay away from controversial topics like politics. But any discussion of my life involves at least some of the issues involved with living in France, and this happens to be one of them. The media in America have a hard time sometimes offering an unbiased view of what certain things are like in France, just as the French media often have their own particular bias about the United States. This post is not about promoting a political agenda, rather just describing my experience going to the doctor’s last Thursday.

I came home from work early Thursday morning after only being there for about an hour, and this after a five day weekend to boot, four of which had been spent with a fever and flu-like symptoms. I took a few aspirin for my pounding headache and fever, curled up in bed and tried to fall asleep. My husband came home at lunchtime however, and badgered me into making an appointment to see the doctor. So I called our neighborhood doctor, who is in fact a practice of three general practitioners who see the whole family. When one of the doctors answered the phone (no receptionist), I made an appointment for that afternoon.

My husband came home from work early, to take me to the doctor, and we drove the five minutes to her office, which is located in the center of our village, in a small apartment over the grocery store. We rang the bell and went inside to the small waiting room, which I assume used to be a bedroom. In fact, there are four units over the grocery store, and the other three continue to be used as apartments.

There was only one other patient waiting, so we didn’t have to wait long, which was good, because the reading material in French doctors’ offices leaves as much to be desired as in American doctors’ offices! Then the doctor called us in to her office.

After taking my social security insurance card, and inserting it into the reader, she started asking me how I was, what my symptoms were etc. Then I lay down on the examining table, she did a brief examination and a throat swab. While we waited for the results, she asked after the general health of the rest of the family, scolded me for not resting enough and reminded me that I need to get a tetanus shot. Then she wrote me a prescription for antibiotics and a work stop order, for two days off of work.

I paid her €22 by check. After finishing, we went downstairs and next door to the pharmacy where I again used my state insurance card. This time I received my antibiotics without any out-of-pocket expense, and the and private state insurance will reimburse the pharmacy.

The whole visit took about 1.5 hours, from when I left the house to going home again, and she might even have made a house call, had I been too sick to move. Admittedly, people living in Paris, or very rural areas won’t experience the same sort of treatment, but the general ease of the system is about the same. The cost of the visit will be automatically transmitted to the state insurance office, and I will be reimbursed €17 by them, and then another €4 by our private insurance company. While I won’t be paid for the two days that I didn’t work, if I had had a longer sick leave, I would have been paid at about 80% of my regular salary.

For more on healthcare in France, including numbers, see these two posts: Healthcare in France and Healthcare in France- an American’s Story.

Going to the Doctor in France by Kelly | Permalink | 11 comments

Money in France and the United States

Kelly — Wed, 15 Jul 2009 10:00:19 +0000

A little more than a year ago, I wrote a post called A Tale of Two Budgets, in which I did a very unscientific comparison of budgets from two families: mine and a family living in the United States. As happens with so many posts, people commented on it, and then as it got pushed further and further into the archives, the comments died out.

A few days ago, however, somebody left a comment on the post saying that he didn’t agree with the numbers supplied by the American family. And then, a few days later, he came back with his own set of comparisons, from his personal experience spent living in both NYC and Paris.

While you should go back to read the original post (and all of the comments Charlie left), the comparisons Charlie made were so interesting that I’m highlighting them here.

Charlie says:

For the record: because ages of budget/income vary by income-level, I will stick to Cost-of-Living figures. Over the last 30 years, I have lived/worked in NYC (urban & suburban), Chicago, San Francisco, London, the Netherlands (Amsterdam & suburban) and Paris, while keeping a home in the USA.

Having lived in both, here’s a breakdown of the relative Cost of Living between living/working in similar areas in a world capital in the USA (NYC – W 82nd off Central Park West) and one in FR (Paris – 16eme near the Bois). Since the site is based on being frugal – the City named in each category is the one that costs LESS of our household income.

Housing – Paris

less than 27% of income vs NY’s roughly 40% (an equivalent to our Paris apt would cost nearly double in rent per month in NYC right now)

Utilities – Paris

about 30% less per month for comparable living space where heat/water chgs are collective

Phone / Internet – Paris

In NYC – a bundle incl TV, unlimited US Telephone calling & 15mbps Internet is $100-120/month. Paris (w/unlimited calling to 60 countries incl US) is €30/mon.

Cell/Mobile phones – NYC

Paris is just catching on to price competition in mobile phone services.

Insurance – Paris

Auto/life is about the same, home is less – but INCL Medical/Hospitalization plus “top-up cover” (i.e. Aflac in the US /”mutuelle” in FR)???
Insurance total cost in Paris is about than 35% of what our insurance cost us in NY… with lesser coverage and higher deductibles (which are nearly non-existent in France or Med Ins)

Entertainment – Paris

Film tix are about equal. But across the board (we are avid cultural fans): concerts, dance, museums, plays etc are cheaper in Paris than in NYC. i.e. West Side Story musical perfomance – Paris top ticket 110 vs Broadway 165 / Alvin Ailey in NYC was $165/seat vs top ticket of 105 in Paris next week.

Air Travel – TIE

Both have substantial discount airlines

Savings

France generally saves more of its income than in the US, although that has changed a great deal with the advent of foreclosures sweeping the USA

Home Repair – TIE

Groceries – TIE

although fresh green groceries are a bit cheaper in Paris as are dairy products

Sundries/Electronics – NYC

For reasons too deep to dive into here, Paris is more expensive for almost all manufactured goods including cars, household electronics, computers, tools, etc

Dining Out -TIE

one can find a range of restos at any price point in either city (although in Value For Money, I’ll take Paris’ food and wine)

Local Tax – TIE

unless you are wealthy, there is no local tax other than a consumption tax (VAT/TVA) in Paris plus habitation and TV services tax. Paris VAT is 19.6% but (to my knowledge) NYC charges about 10% VAT PLUS up to 8% income tax. Owned Property tax is higher per assessed value in NYC than Paris a well unless you are assessed a “wealth tax” which near evens it out.

Medical Care – Paris

The cost of services, tests, care and prescription medicine is about 10-20% of the same services in NYC. eg: an MRI in NYC = $1000-1500 vs Paris = €89, 2 wk course of antibiotics: NYC $60 vs Paris €5-7

Transport – Paris

Metro/Bus/RER system 1.50/11.40/56€ for 1 trip/10x/month pass
New York city Subway/Bus = 2.25/20/89$ for 1 trip/10x/month pass
Paris->Amsterdam via TGV = 50€ vs NYC->Wash DC on Amtrak = $155 (for a shorter distance)

By the way – before anyone brings up currency conversions, one who has lived overseas knows that conversion (though hard to stop doing in your head ‘-) does not apply when talking about residents who earn the currency they spend — only to people who earn in one and spend another currency, which is quite rare. In general, its 1-to-1 units even tho NYers may earn a bit more doing a similar job, but that is impossible to discuss in this limited context.

Money in France and the United States by Kelly | Permalink | 8 comments

Know Where You’re Going

Kelly — Mon, 06 Jul 2009 05:54:15 +0000

My oldest son is starting first grade this year.

In France, children start school in the September of the year they turn three; they go for three years to nursery school, or maternelle, before going to elementery school, or primaire. So while starting first grade this year isn’t quite as emotional for me as it was when he went to school for the first time, it is still a big deal.

But I digress.

In fact, my son will not be going to the same school that he has already been attending for three years; he’s been accepted into the international public school. This means that he’ll be doing most of his classes in French, but will also have some classes in English. More importantly, it means that he’ll be with other bilingual, bicultural children.

However, enrolling him in this school, although he’s already been accepted, means dealing with French bureaucracy, which, I’m sure you’ll understand is a frustrating affair, to say the least.

The other day I decide to tackle the unpleasant chore of submitting his paperwork. I decided to leave the kids with my in-laws, so I drove from my end of town to their house. Then I drove from their house to the Prefecture, or city administration headquarters, to enroll my son. Once I got there (and paid for parking), however, I decided to look at the letter of admission one last time before going inside. Lo and behold, it said that I needed to do the paperwork at a local branch of the Mairie, or mayor’s office. When I looked at the map, the place I needed to go was back on the other side of town, near my in-laws’ house.

Grrr.

So back in the car I go, in the sweltering sun and heavy traffic. When I get to the mairie, the woman informs me that I need to bring a whole slew of other documents, photocopied and in triplicate, before she will accept our file.

The point of this story is that, had I looked at the letter of admission, and a map before setting out, I would have saved myself a whole lot of time, frustration and gas. And I find that I often do the same thing with my financial goals as well.

I often don’t take the time to read the documentation, or plot out my objectives in detail, or map where I’m going or want to go before heading on my way. And by doing so, I often feel frustratred and out of control, with no clear result at the end of the day.

I know this about myself, and I know that I need to remind myself to sit down and plan things out before I jump into things. I’m working on it, and slowly improving.

But the follow up trip to the mairie will have to wait til next week!

Do you plan things like your financial goals in advance, or just jump in feet first?

Know Where You’re Going by Kelly | Permalink | 4 comments

It’s Labor Day

Kelly — Fri, 01 May 2009 15:48:52 +0000

Today is Labor Day in France (and most of the world in fact). It’s a special day here, the only day when the entire country stops working, and unlike the US where Labor Day marks buckling down and going back to school, it’s the unofficial start of summer here. Sundays, even though they are supposedly the day of rest, are different; although it’s against the law for most shops to be open, some still are, especially small, family run shops. Or boulangeries (French people do love their fresh bread!). Buses and trams still run, McDonalds is open until midnight and there is activity as normal in touristy areas.

But today is different- everything is closed, even the public transportation shuts down, at least in the city in which I live. It’s a day for people to be with their families, in parks or at home, a day to celebrate being able to work by taking some time off!

Another funny thing about today is that it’s the one day where people are legally allowed to sell things in the streets (not themselves, of course!), and political parties usually sell small bouquets of lily-of-the-valley to finance their work. France’s legal system considers that it protects small business owners and private individuals by not allowing people to sell things without the proper permits; garage sales are illegal for example, unless run by an association. So today really is special in a lot of ways.

I like this holiday quite a lot now that I have a car, and a house, and a family, and have something to do instead of being trapped at home all day wondering what to do! But I can imagine that, as many people that are happy about having the day off (and a three day weekend to boot), there still are others who feel that it’s just one more day to get through, and even worse, without the distraction of shopping, or being able to get around on public transport.

So, here’s to all who have jobs, and are able to take time off! And to those who don’t have that luxury, here’s to hoping that this time next year you’ll be able to celebrate the start of summer by wishing for a day off yourself.

Happy Labor Day!

What’s your favorite public holiday? When does summer start for you?

It’s Labor Day by Kelly | Permalink | 4 comments

5 Things About Money in France

Kelly — Mon, 16 Feb 2009 11:00:42 +0000

Living in a different country is a fun (although not always) way to learn how attitudes towards money can change. Here are some things I’ve learned through eight years in France.

1. The French are savers- with almost the highest rate of savings in Europe. Over the past ten years, the average number of French households with savings accounts fluctuated around 16%, while in the United States it hovered closer to 3 to 5%.

2. Credit cards are almost unknown in France. This is because most people use their debit card to pay for things. Many people also have an overdraft account attached to their checking account, with the overdraft charging around 12% interest.

3. There is no credit bureau in France- which can lead to problems for French expatriates, as there is no official ‘credit history’ when they leave France. Instead, each company develops its own method of determining a loan candidate’s financial trustworthiness.

4. The average salary after deductions (but before taxes) for a new teacher in France is €1200 per month (14,400 annually) while an experienced teacher will earn twice that. The average salary for traditional public school teachers in the United States increased 4.5 percent in 2006-07 to $51,009 ($4250 monthly before taxes), according to the AFT’s latest teacher salary survey.

5. Gas costs about the same as it does in the US, at least until you add in taxes. Approximately 70 of the price paid goes to the state.

Have you ever spent long periods of time abroad? What did you learn about money and spending?

5 Things About Money in France by Kelly | Permalink | 16 comments