Saturday, October 25, 2008

Read "A Broom of One’s Own" for realistic insight into life as a writer.

A Broom of One's Own: Words on Writing, Housecleaning, and Life is a sublime little book of essays by Nancy Peacock.

In A Broom of One's Own, Nancy Peacock, whose first novel was selected by the New York Times as a Notable Book of the Year, explores with warmth, wit, and candor what it means to be a writer. An encouragement to all hard-working artists, no matter how they make a living, Peacock's book provides valuable insights and advice on motivation, craft, and criticism while offering hilarious anecdotes about the houses she cleans.

While reading the book, I couldn’t help but think maybe there is some truth to Penelope Trunk’s post five reasons why your should not write a book.

According to Penelope:
People who have a lot of ideas need a blog, not a book. A blog is more immediate, so you’ll get better feedback~
Nancy’s life as an aspiring writer was difficult. In her early years, a blog may have served her well. She struggled to get her stories published; writing and submitting 100’s of short stories to various publications in hopes one would sell. At one point, she even succumbed to writing fake true stories for True Confessions Magazine. A blog may have given her the immediate feedback she needed.

You'll make more money per hour flipping burgers than writing a book~
Nancy’s first book, Life without Water, did not bring her riches, immediate fame or prestige. After publication she still needed to clean houses to pay her bills. It wasn’t always easy, but she continued writing because she loved her craft. She says it best on page 53 where she writes:
"I think that in the beginning of my writing life I believed that writing, publication in particular, could, besides making me rich, also make me invulnerable. It might have been the stupidest thought I ever had, because there is nothing, with the exception of love, that has ever made me feel more vulnerable than writing and publishing."
Beautiful. I cannot give this book justice. If you have ever had any interest in writing or in an artistic career I highly recommend this book. Even if you don't have an interest in writing, I recommend this book. Her essays on housecleaning are thoroughly enjoyable; some of her cleaning clients remind me of people I know. This was both hilarious and scary.

Please Note, I am an Amazon Affiliate

Friday, October 17, 2008

401(k) Fees Rant

In addition to my recent angst regarding stock market volatility, I have just discovered one of the reasons why my 401(k) fund returns were always lower than I anticipated. My company has our plan pay for expenses such as our plan audit, which can run as high as $8,000 annually, plus the cost to transfer employee payroll files to the plan each pay period. Our payroll service provider tells me it is common for companies to have their 401(k) plans pay for these types of expenses.

What is included in 401(k) plan administration fees:
According to the U.S. Department of Labor, the day-to-day operation of a 401(k) plan involves expenses for basic administrative services -- such as plan record keeping, accounting, legal and trustee services -- that are necessary for administering the plan as a whole.

As an employee whose benefit package includes fewer benefits each year, I was upset that my company would require our 401(k) plan to pay for expenses such as the ones I mentioned above. Aren’t these expenses a tax-deductible cost of doing business? Can’t companies pay for anything anymore? My lousy benefit package and measly company match, 50% of the first 2% of salary deferment, suddenly seems even worse.

High 401(k) plan fees is not news to me:
I have read in the past, over time 401(k) plans may earn a lower rate of return than other types of investments due to high fees. A good fund should have a total expense ratio of 1% or less. My 401(k)'s funds typically earned lower rates of return than the funds in my IRA. I did try to determine the expense ratio for each fund, but was unable to find any mention of expense ratios in the fund literature provided by our 401(k) provider. I now realize these fees are usually hidden.

In the Kiplinger article, “The High Cost of 401(k) Fees: How Much Are You Paying,” Mary Beth Franklin writes:
Mutual fund returns in 401(k) plans are normally reported as net returns, meaning that fees for managing your investments are subtracted from your gains or added to your losses before calculating the annual return. Other costs, such as administrative and record-keeping fees, are often divvied up among plan participants but are not explicitly listed on individual investment statements.

You can read Mary Beth Franklin’s informative article in its entirety here.

Sunday, October 12, 2008

Top Salesman maxes out his 401(k) Plan

Our company’s top salesman, also known for his financially savvy, has requested our payroll department max out his 401(k) plan when issuing his commission check on Monday. He is under age 49, so he can contribute up to $15,500 for 2008. This check will include the majority of commissions he has earned this year; allowing him to take advantage of the plan's tax deferral in addition to the down market.

I cannot help but be comforted by his actions. This request comes at a time when I have been trying hard not to panic or do anything rash with my own 401(k). Over the past two weeks, many of my co-workers have stopped contributing to the plan altogether. In a year when this salesman is struggling to maintain his #1 position for the first time in 22 years, he has enough confidence and risk tolerance to pump a large chunk of his paycheck into the market. As he made his request, he said, “With twenty years remaining until retirement I would be crazy to stop contributing now; if the market were to completely collapse, which it won’t, the economy would be in such disarray stopping now wouldn’t make a difference in the long run anyway.”

"Enough Said"

Saturday, October 04, 2008

The Digital Camera Saga

For the second time in four years we have experienced problems with our Canon POWERSHOT S1 IS digital camera. Most recently, the image displayed in the view finder was completely black preventing any attempts at capturing a picture. This was a huge disappointment, since I first noticed the problem during a family outing where I very much wanted to take pictures.

Afterwards, I inquired with the camera store where we had purchased the Canon about the possibility of repair. I was told it would cost $140 for Canon to even look at the camera. Since this was the second time we had experienced problems with this camera, we decided to forego the repair and put the $140 towards a new camera.

We decided on the Nikon Coolpix P80. Unfortunately, you can no longer buy just a camera. The $350 purchase quickly turned into $450 with the addition of accessories. None of our Canon accessories: batteries, memory card or camera bag were compatible with our new Nikon.

After relaying my Canon digital camera saga to a co-worker who happens to be a photography buff, I decided to talk directly with the manufacturer about my camera. My co-worker’s experience with Canon has been that they always stand behind their products. Sure enough, Canon had recently issued a service advisory addressing my camera's problem. They volunteered to fix the camera for free. They emailed me a pre-paid UPS label and within a couple of days my Canon was back in our possession working like new.

This saga has worked out well in the long run; we now have a new camera we love plus a backup that works like new. That is, if we don’t think about the $450 were hadn’t planned on spending.

Lessons learned:
-Always contact the manufacturer directly if you are not satisfied with the distributor’s response to a service query. The camera store’s interest was in making a new sale not repairing our old camera.

-With technology constantly improving; items such as digital cameras, printers, mp-3 players and cell phones quickly can become obsolete. When replacing these items be prepared to spend money not only on the replacement item, but also on its accessories.