Almost Through

Sorry for the prolonged silence on the blog! I've got just one week left before the end of this Summer Session. We're down to the last 7 quizzes in my PLANTS class and the last Discussion in my MONEY class. Then each has an online Final Exam which I will take on Sunday and Monday, respectively. Should be interesting!

The PLANTS class has been by far the harder of the two, but I've learned a great deal in both of them. Two great books in the MONEY class deal with the present economy and why the average middle-class American family is struggling financially. Major changes in how financial institutions do business has occurred in the past 20-30 years that make today's economy a very dangerous place for the average family. There are no longer any limits on loans like there used to be. A bank has the legal right to loan anyone any amount of money for any interest rate without repercussions. Bankruptcies have skyrocketed and foreclosures are commonplace.

In the first book, Two Income Trap, the authors (a mother-daughter combination) contend that the main reason families are struggling in today's economy isn't due to over-consumption or frivilous spending. In fact, they say that families have lost their "safety net" by having both parents in the workforce! The true value of a stay-at-home mom (or dad) is that when a crisis happens or the breadwinner is laid off, the non-working parent can take a temporary job to get the family through the crisis. With both parents working and the family relying on BOTH incomes to make ends meet, when crisis comes there's no fall back position. Their research is comprehensive and very well presented. Astonishing in today's climate to see someone -- anyone -- advocate for a stay-at-home parent! Yay!

Their second book All Your Worth, by the same authors, details a very sensible method to get your spending into balance between "Must-Haves" (the bills you have to pay each month), "Wants" (fun money), and Savings (to build a better tomorrow). No matter what your income, they recommend a 50/30/20 ratio with no more than 50% of your income to pay your bills, and a minimum of 20% of your take-home pay into Savings. The rest is fun money!

It is very heart-warming to read the positive feedback during the class "Discussions" from these twenty-something kids just starting out in life. This kind of wake-up call so early in their financial life is so essential. Being in college is great, but if they don't know how to manage their money after they graduate, what's the point? And it's positively amusing to see the young females visibly squirm with the concept of staying home to raise their kids! In actuality, the authors don't say one parent MUST stay home, they mostly recommend not relying on both incomes to pay the bills. Families who have both parents in the workforce are better off using mom's salary for FUN stuff like vacations and home remodels! Because if something happens to one income, or grandma needs year-round care, or divorce intrudes, there is some breathing room in the finances.

Well worth the read if you need to combat the summer brain drain!