Gails Blog

In my humble (yah!) opinion, The I-Work-Hard-So-I-Deserve-It Gremlin is, perhaps, the hardest to combat. Having slaved away in the mines all day, we feel entitled to a pint with the boys, that new pair of shoes, or dinner out. We need a glass of wine to relax. We need a vacation. We need a new car.

Nothing brings this home faster than when I see people lined up to exchange their money for the latest techno-gadget. I can’t believe that people are so rabid to spend their money that they’ll get in a loooooong line, get rained or snowed on, sleep on the sidewalk just the be able to say they had it first. (Really? First?

Many of the couples I work with demonstrate that they’re walking around with the I-Work-Hard-So-I-Deserve-It Gremlin in tow. They’re willing to exchange their future incomes (yeah, that’s what credit is, people) for STUFF they deserve to have. I’ve had people tell me, “We work really hard, we deserve a vacation.” I’ve had people tell me, “I have a great job, I deserve to drive a nice car.” And I’ve had people tell me, “I do twelve-hour shifts, I deserve dinner out.”

Hey, for all the people who want to drop $700 on the latest cell phone who HAVE THE MONEY IN THE BANK, I don’t have a thing to say to you. It’s your money; spend it any way you wish. But for the dopes who are planning to put that new phone on credit and then carry the balance around for a few years at some ridiculous interest rate (any interest rate), give your head a shake.

The thing about the I-Work-Hard-So-I-Deserve-It Gremlin is that it can trick you into pledging many years of future income for the pleasures you’re seeking today. It doesn’t care how much interest you’re going to have to pay, how much more expensive that Have-to-Have-It item will be when you tack on the interest, or how long it’ll take you to get out of debt. And it doesn’t care that what else may end up losing if your circumstances change and you find you can’t pay for that holiday you deserved.

Advertisers know that people love to take a stroll down Luxury Lane with the I-Work-Hard-So-I-Deserve-It Gremlin. They put it in their clients’ slogans, sing it to you, show you people just like you who are buying what you will come to feel you, too, deserve.

Nowhere has the I-Work-Hard-So-I-Deserve-It Gremlin done more damage than in the arena of home-ownership. We have come to believe we deserve to own our own homes. Never mind that we haven’t had the commitment, the discipline, or the foresight to save a downpayment. Lenders have played into this delusion by offering borrowers far more credit than they should have access to. So there are people who have bought homes they can barely afford. Sadly, when the time comes to renew the mortgage, even a small upward movement in interest rates will make payments unmanageable.

The current foreclosure mess in the U.S. is the fallout of hanging out with the I-Work-Hard-So-I-Deserve-It Gremlin.  Re-framed as a “right”, the American dream of homeownership was assumed by too many people who never considered the true costs and sacrifices required to make the dream a reality. And so now the dreams have been shattered and families are finding themselves out in the cold, literally.

I see a lot of people struggling to repay debt for things they felt they deserved. In 2006, almost 100,000 Canadians had to file a creditor proposal or declare bankruptcy because they lost the struggle. In the U.S., 618,000 people filed for bankruptcy. I’m willing to bet dogs to donuts none of those people felt they deserved it.

BTW: No blog tomorrow. We’re taking the kids to Stratford for some Romeo & Juliet and Hamlet. Back Monday. Have a great weekend. 

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He who dies with the most toys wins. This sentiment is usually attributed to men. I’m not sure why, but it applies to anybody who has been listening to the Having-More-Means-A-Better-Life Gremlin.

In our very consumer-focused, advertisement driven, marketing molded world, “better” has come to mean “more”. People think that their lives will be better if they can just figure out how to have more – more big screen TVs, more shoes, more money.

Ya know what, based on my experience, more STUFF doesn’t make us more HAPPY. Nope. In fact, I’ve seen an inverse relationship. It seems the more UNHAPPY we are, the more STUFF we need, as if it is a balm to soothe our sense of what’s missing.

If more made us happy, then lottery winners, people who inherited, and people with the highest income would be the happiest in our land. Not so. Studies have shown that those who suddenly come into “more” are often worse off five years later.

According to a study by Princeton economist Alan Krueger and Nobel Prize-winning psychologist Daniel Kahneman, “The belief that high income is associated with good mood is widespread but mostly illusory.

So why this obsession with accumulating STUFF? Why the drive to have the latest phone, the newest in fashion, the shiniest car? It may simply be that we’ve stopped measuring the richness of our lives by the things we take for granted, that other people would die for. Things like clean air, an abundance of water, healthy food, good health, the availability of education, meaningful work, and freedom of religion and speech, to name just the most obvious.

When Barbara Walters interviewed billionaire David Geffen and asked, ‘O.K., David, now that you’re a billionaire, are you happy?’ his response was ‘Barbara, anybody who believes money makes you happy doesn’t have money.’

Bill McKibben’s recent book Deep Economy: The Wealth of Community and a Durable Future explores the idea that the foundation of our economic assumptions must be re-evaluated and re-tooled. While our civilization has conditioned us to believe that more is better, it ain’t so. However, many of us are willing to go deeper into debt every day to prove how well we’re doing.

We have substituted consumerism for what people really want: love and community, a sense of belonging, worthwhile effort, happiness. The work of overcoming our rampant consumer addiction can only be done inside ourselves. Nobody else can fix this for us. We need, individually, to fix it for ourselves.

How?

Move from being Impulsive to Thoughtful. Stop choosing short term gratification over our long-term benefits. Saving for retirement might be boring, but it’s going to be really important when you finally do stop working and are looking for a way to keep a roof over your head and food in your belly.

Stop Rationalizing. You can always find a “good reason” to scratch your acquisition itch. We are the masters of rationalization. We’re saving so much on an item, we just have to buy it. People take this to the extreme buying things they don’t need, don’t want, and can’t use, just because they’re focusing on how much they are saving. (Hey, if you’re spending you’re not saving.) Or we decide that buying “quality” is worth going into debt. Really? Or we focus on some extraneous issue: since I am fat, I need to spend more money on clothes so people won’t think I’m ashamed of my body. Hmmm. We apply this rationalization to why we need to buy a certain car, acquire a bigger house, or  wear brand names. It isn’t about meeting needs. It’s about the Having-More-Means-A-Better-Life Gremlin weaving its magic spell.

Undo Your Illusions. People confuse the medium for happiness with the actual results, the most famous example being money. Even though money itself doesn’t make people happier, we continue to work harder to get more money. More is better. But it isn’t. Sometimes more is just more.

Alan Krueger and Daniel Kahneman study found a weaker-than-expected correlation between income and happiness. Looking at a Bureau of Labor Statistics survey on how people with various levels of income spend their time, they discovered that women who make over $100,000 a year spend 19.6% of their time having fun, while those who make less than $20,000, spend 33.5% of their time kicking back or socializing.

The Having-More-Means-A-Better-Life Gremlin is misleading us to work for more money even when happier pursuits would ultimately do us more good.

How are you going to conquer the Having-More-Means-A-Better-Life Gremlin? Books, websites, gurus on “simplification” abound, and the message is trickling down slowly. Very slowly. And perhaps now that we’re having to spend significantly more of our income on NEEDS — fuel for our cars, fuel for our bodies — we’ll move back to focusing on what’s really important, and not on the STUFF. 

Tomorrow’s Gremlin: The I-Work-Hard-So-I-Deserve-It Gremlin

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I’ve just finished working with a couple that I LOVED! Sweet, enthusiastic, bent. So much room for improvement. The first thing I noticed when I Dropped My Bag And Had A Quick Look Around was that there wasn’t a corner of the house that didn’t have a doodad of some sort in it. I asked if this was part of her culture – if she was recreating the home she’d grown up in. Noooo. That wasn’t it. She was just a Stuff Gatherer. I pointed out that there wasn’t a corner of the house that didn’t have a little table with stuff on it, candles, or some other doohickey. She didn’t see what I saw.

Later I went into the main floor bathroom and, as I was having a pee, I noticed that in front of me, in the corner, was a set of candles – tall – just standing there in a threesome. How strange, I thought. When I glanced under the sink, there in the corner was a picture, leaning up against the wall, UNDER THE SINK. I brought my Tchotchke Queen into the bathroom. She gasped. She’d never noticed that she was filling her corners with STUFF.

Three gremlins were at work in this house. And I’m sure they inhabit many homes, so I’m sending you around your house to look for them and evict them. I’m going to deal with them one at a time so you have some time to come to terms with these gremlins if they are at work in your psyche.

First up, the I’m-the-Shopper Gremlin, which was always whispering in Lucy’s ear. Since she was responsible for keeping her house beautiful, keeping her children beautiful, keeping her husband beautiful, she was always shopping. She loved a good bargain and made a habit of hitting the Everything-60%-Off-Everyday Store every chance she got, which was usually EVERY DAY during lunch hour since there was a store right across the street from work. And she hardly ever went in without buying something. New hand towels, a shirt for her husband, clothes for her kids, a beautiful set of glasses, another picture, yet one more candle… Her family had made her responsible for the acquisition of what they needed and she was taking her role as BUYER very seriously.

Problem is, the I’m-the-Shopper Gremlin has no clue about the difference between a NEED and a WANT. It just wants to SHOP. And so, with this gremlin whispering soothing messages of love, caring and responsibility in her ear Lucy shopped.

The first thing I needed to do was bring her to her senses on what was a NEED versus what was a WANT. With some help, she had to go through rooms of her home and take out the “wants”, piling them up for me to see. More importantly, she was piling them up so she could see the crap she’d gone into debt for. What a success! Worked like a sledgehammer. So there was Lucy, surrounded by her stuff, wondering how the hell she could have been so unconscious in her shopping.

Lucy isn’t alone. There are loads of people who do this. But Lucy got the message. As I was showing off my new, snappy shoes (pink, green and yellow high-heeled sandals which I picked up for $16), she quipped, “Were they a need or a want, Gail.” Ha!

So how do you get a handle on the I’m-the-Shopper Gremlin?

Some people decide they will only shop one day of the week. You’ve seen me encourage fams to do this, since it takes away the temptation of the Impulse Buy.

Some people decide to shop with a list and only buy what’s on the list. If they see something they want, they add it to their next list.

Some people declare a moratorium on shopping, deciding to participate in Shop-Free days two or three or four days of the week. So they can’t buy ANYTHING on Shop-Free Saturday, for example.

Then there are the folks who challenge themselves to see how long they can go without buying anything. (Usually gas and food are the exceptions since they are virtually always NEEDS.) If they do shop, they have to start their counting again, and they’re always trying to beat their last best No Shopping Streak.

If you’ve got this gremlin running rampant through your life, what’s your plan to cope? Without a plan,  the I’m-the-Shopper Gremlin will not only end up costing you a lot of money, it’ll also end up making you spend way more time than you should have to DUSTING! ? Boo, hiss to the  I’m-the-Shopper Gremlin.

Up next, the Having-More-Means-A-Better-Life Gremlin.

The unemployment rate in Canada hit 6.2% in July, despite record high employment rates in Alberta, Manitoba and Nova Scotia. With all the crap happening south of the border, unemployment is likely headed up in the short term as we deal with the credit crisis. Often, when we find ourselves out of work, we duck and hide, embarrassed at our change in circumstances. And we spend. Unwilling to admit that things have changed, and with time on our hands, we spend and spend and spend. Well, if you’ve seen my show, you know where that leads.

In my last blog, I talk about the unemployment rate in Canada and the potential downturn we may experience. I thought I should give you some world figures to put things in perspective.

The credit crisis is causing rising unemployment in the UK, with official unemployment figures for last month the worst since 1992.  The UK unemployment rate is 5.2%.

In the U.S. people are cheering because their unemployment figures seem great compared to elsewhere, but July’s rise in unemployment was the seventh straight; the current 5.7% is the highest rate since March 2004.

According to Eurostat, the Statistical Office of the European Union, unemployment sat at 7.3% in the euro area in June 2008.The lowest unemployment levels were recorded in Denmark (2.7%) and in the Netherlands (2.9%); the highest were in Slovakia (10.5%) and in Spain (10.7%). Poland sits at 7.3%, Bulgaria and Ireland are at 5.7%.

The Organization for Economic Cooperation and Development (OECD), which is made up of 23 European countries and Australia, Turkey, New Zealand, Canada, Mexico, the United States, Japan and South Korea, is predicting an average rise in unemployment in 2008 and 2009.

So what do you do if you find yourself out of work?  Here are 9 Things to Do if You Lose Your Job:

1. Tell your family not to panic. Yes, things are going to be different for the short- or medium-term, but you’ll weather this together. You need to have a clear sense of what your priorities are so that you can work together to get through this without fighting, bitching, snarking, crying, or being a’feard.

2. Tell everyone you know that you need a job. Many jobs never make it to the advertisement pages since people in a company will be asked if they want the job, or if they know of anyone they could recommend for the job. The more people you tell the better your chances are that someone will put forward your name. Be clear about what kind of job you are seeking and what your skills are, and someone may be able to help you get a new job. But also be open to experiencing something new, and using your skills in different ways. If you hated your last job, don’t get another one just like it.

3. Apply for employment insurance benefits. While this is usually barely enough to keep body and soul together, it’s still better than a kick in the teeth. If you find employment before your benefits begin you can always cancel the claim.

4. Start looking for a job. Dust off your resume. Hit the web. Some part-time work that supplements your income while you’re looking for a full-time job will help to keep you busy and focused on making things happen. One of the biggest problems with unemployment isn’t just the lack of money, it’s the abundance of time and the sense that this will never end. Get busy.

5.  Cut your expenses. First, you need to cut back to the bare minimum so that you can make your emergency fund (you have one of these, right?) last as long as possible. Ditto your employment insurance benefits, your severance, your partner’s income or whatever else you may have that you can use.  Cancel the cable, decide between the home telephone and the cell phone, don’t buy anything that isn’t food, and consider your quarters your entertainment budget. Second, since you may not find a job paying the same money, you need to decide what your Basic Costs of a Good Life are so you know how much salary you can live without.

6. Talk to your creditors. Don’t ignore your bills. Contact your creditors and explain your problem. Offer to make regular smaller payments that you can afford for a short period of time. Ask for an interest rate concession. Get those credit payments in line with your new income.

7. Embrace change.  In all likelihood if your industry is in retreat you’re not going to find a similar job for similar money easily.  Two part-time jobs may be as good as one full-time. Contract work may be a good option for rebalancing your life. Business opportunities may present themselves and you’ll have to have your eyes open to take advantage of them. Don’t be closed to a relocation if that’s what it takes to get you back on track.

8. Take care of yourself.  Don’t climb on the couch and hide. Don’t dig into a big tub of cookie-dough ice-cream. Don’t stop exercising, socializing, empathizing. If you find yourself becoming really sad about your situation, find someone to talk to about it. Don’t let yourself go into a nose-dive. Keep to a schedule and keep your focus. Volunteer so that you can keep meeting new people, widening your network, and putting more people into the job-hunt on your behalf. Take a course to update your skills or learn new ones.

9. Keep your sense of humour. When things get tough, our funny bone is the first to go. Don’t let it. You can do so much when you’re smiling. Your interviewers will see you differently. Your family will be reassured. Your friends won’t run and hide when you call. Hang on to that funny bone!

There’s no longer such a thing as a Job for Life. Gone are the days when you retired from the first company that hired you. The new reality is that you can expect to have up to eight – count ‘em EIGHT – careers over your working life.

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Don’t read this if you’re a Republican or a Conservative. 

I hope y’all are having a lovely weekend. It’s pouring here so I’m at my computer fooling around. As I mentioned in a previous blog, I’m working on a series for university students that will hopefully help with planning and dealing with student debt. If there are any specific things you want me to cover, let me know and I’ll try to work them in.

Another question: I’m thinking of making The Money Tree Myth, my book on how to teach kids about money, available at Lulu as I did with A Woman of Independent Means. I’m just trying to ascertain if there’s sufficient interest to be worth the effort. Let me know if you’d find this book useful. 

You’ve all been terrific and have made this one of my favorite things to do. I want it to keep working for you. If you have questions about life, the universe and everything, think about what you would like to know more about, and then ask me a specific question to which I can respond in a blog. If there’s something that makes you go, “Hmmmm” I want to know about it. If there’s something that bugging you, tell me. If there’s something that you just can’t get your head around, throw it at me. I’ll do my best to keep it simple and straightforward.

If there are sites you regularly visit that you’d like to suggest to other readers, please do so.  I have, from time to time, suggested places you might like to visit. But I won’t put up a blogroll because:

1.  I’d have to keep it up-to-date; links expire and I don’t have the time to keep checking back, and
2.  I’d hate to have a site on my blogroll that then posted something I just don’t believe in. So I’ll continue to make suggestions, but those suggestions will be dated in my blog so you’ll know when I last looked at them.

I added the bookmarks below to make it easier for you to keep track of your favorite blogs, but I’m not sure if this is something y’all will actually use. Let me know. If it’s not useful, it’s toast!

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The big news of late is how much more expensive it is to a) eat, and b) get around.

These are pretty basic needs. Most of us can’t walk everywhere we need to go and even if we could, the cost of fuel is pushing up the goods and services that have to be transported to the stores where we buy them. Eating… well… that just goes without saying.

So why does the consumer price index make it look like we’re in such fine shape? Inflation, while pinching us at the gas pump and in the supermarket, doesn’t seem to be reflected in the numbers we hear on the news. That’s because there are a lot of things that make up the Consumer Price Index (CPI) basket including:

1. Food – 18%
2. Shelter – 27.9%
3. Household operations and furnishings – 10%
4. Clothing and footwear – 6.6%
5. Transportation – 18.3%
6. Health and personal care – 4.3%
7. Recreation, education and reading – 10.4%
8. Alcoholic beverages and tobacco products – 4.5%

The products in the basket are weighted based on their common usage – those are the percentages. The weights determine the impact that a particular price change will have on the overall consumer budget.  For example, a 5% rise in the price of milk would have a much greater impact on the average budget of consumers than a 5% increase in the price of tea, because people spend on average more money on milk than they do on tea.  The weight for Canada assigned to milk (0.69%) is greater than that of tea (0.06%).  Without weights, price changes for all commodities in the CPI basket would be given equal importance in the calculation of the All-items index. Here’s one of the problems: according to their own documentation the current set of weights refer to household expenditures for 1992. 

With housing prices having skyrocketed in the last decade, me’thinks the numbers could be a little off. Housing is eating way more than 28% of our budgets in many parts of the country. Ditto the fact that while some costs have risen dramatically affecting everyone’s budget, others have fallen, affecting only some people’s budgets.

The costs of computers, TVs, software, audio equipment, clothing, appliances and new cars have gone down, offsetting the increases in things like food and gas, to make inflation appear less dramatic than most of us are actually feeling in our wallets.

And while the price of a box of yogurt may appear to have remained stable, food manufacturers are dealing with the increases in costs not by raising their prices, but by reducing the amount they put in the box. So quantities are going down, while prices seem to remain stable. (Have you noticed that your food containers hold less food? Check it out.)

Ultimately, as the costs for covering our Essential Expenses rise, less and less will be available to spend on the bottom half of the CPI basket of goods. The problem with that is a vicious cycle: we don’t buy TVs or cars and the manufacturers have to lay off the workers who build them; then people laid off don’t have the money to keep body and soul together.

This would have started a long time ago had so many people not had credit available to buy the things they really couldn’t afford. We’ve been buoyed by a credit bubble that’s burst in the U.S., Australia, and elsewhere around the world. Don’t let the pundits fool you. We’re in deep doo doo and we’d better learn to live on what we make FAST.

There is no doubt in my mind that we will see increases in unemployment across the country as we come to terms with our new economic reality. The really sad part is that we might be able to hold on with one income in our family, if we didn’t owe money to every Tom, Dick & Harry. With our debt loads having reached record levels, we don’t stand a hope if we don’t get ourselves in the black. And SOON.

The economy, like the stock market and life itself, is a cyclical thing. Where we are today is not where we will be in six months, a year or a decade. But if we don’t have the tenacity (and the emergency fund) to hold us through the bottom of the cycle, the cost emotionally and to our families’ sense of well-being can be devastating.

So, what’s it going to be? A new TV? A better cell phone? Or the peace of mind that comes from knowing you can weather the economic storm that may or may not be just around the corner?

For those of you who have been asking for episode #s and show titles, here’s a list. I’ll post Season 5 as soon as it begins to air in the fall (October, I think.) 

Season 1:
 
1001 - Drowning in Debt
1002 - Dancing Around the Truth
1003 - Physician, Heal Thyself
1004 - Without A Safety Net
1005 - Buy Now, Pay Later
1006 - A Life of Convenience
1007 - Buying Into Bankruptcy
1008 - Taking Care of Business
1009 - The Romance With Cash Advance
1010 - No Laughing Matter
1011 - The Princess and the Paupers
1012 - The Great Wall of Silence
1013 - The Money Pit
 
Season 2:
 
2014 - The Juggling Act
2015 - The Wake-Up Call
2016 - No One At The Helm
2017 - Driven To Debt
2018 - Let’s Make A Deal
2019 - The Vicious Cycle
2020 - Back to Back Baby Blues
2021 - Foreclosure
2022 - Poor Choices
2023 - Small Business, Big Dreams
2024 - The Blame Game
2025 - Playing House
2026 - The Wedding Special
 
Season 3:
 
3027 - The Mushroom Princess
3028 - Taking Charge
3029 - Half-Baked
3030 - It Takes Two to Tango
3031 - The Showdown
3032 - Love Among the Ruins
3033 - New Marriage, Old Debt
3034 - Gail Force Winds of Change
3035 - Life In The Fast Lane
3036 - Single Mom Shake-up
3037 - Does Daddy Know Best
3038 - He Says, She Says
3039 - The Worst Family Ever?
 
Season 4:
 
4040 - Complete Clean-up
4041 - Get Financially Fit
4042 - The Bottom-Dwellers
4043 - Love Affair With Luxury
4044 - Raising A “Stink”
4045 - Lights! Camera! Action!
4046 - Champagne Tastes, Beer Budget
4047 - Out Of The Man-Cave
4048 - Up In Smoke
4049 - Bye, Bye, Bling
4050 - Don’t Ask, Don’t Tell
4051 - Hogwild
4052 - ‘Til Dogs Do Us Part 

I’m about to become the proud momma to two new Bichon Frise puppies. They were just born and will be ready to come home to momma in about eight weeks. Coincidentally, I just got a credit card statement with a stuffer for pet insurance. Hmmm. Signal from the Universe? So I got to thinking about the issue of pet insurance and whether or not it’s worth the money.

Pet insurance is becoming very popular because vet costs are rising and interventions are becoming much more expensive. According to the American Veterinary Medical Association, Americans spend more than $20 billion dollars a year on veterinary care.  In 2003, fewer than 1% of an estimated nine million Canadian pets were insured. ConsumerReports.org says that’s because pet insurance doesn’t offer good value for the money you have to put out.  And I quote:

The problem with pet insurance is all its fine-print pitfalls. Indeed, buying a policy may end up increasing a pet owner’s total expenditures on veterinary care by thousands of dollars, according to our analysis of five plans. That’s because on top of deductibles required by all the insurers, plus any co-pays, unreimbursed costs, and exclusions–all of which you pay out-of-pocket–you also pay premiums. Seemingly small $11 to $50 per-month premiums can add up to $2,000 to $6,000 or more over a pet’s lifetime.

See their take on it. (http://www.consumerreports.org/pets/0307vet2.html)

If you decide in favour of pet insurance, it appears you have to be careful; you don’t want to just pick any old plan. There are policy options you’ll want to ask about such as benefit limits, deductibles, and, most importantly, what’s covered. Ask about:

• enrollment period: from what age to what age. Some plans cover critters from 8 weeks old to death; other cut off coverage at 8 years or so (hey, isn’t this exactly when you’re most likely to need coverage?)
• wait period: Plans often have a wait period of up to 21 days from the time you fill out the application until the plan goes into effect. Some plans also require a vet checkup before the plan is activated. 

• benefit limit: the maximum the plan will pay out a year or over the life of the plan
• deductible: how much you must pay from your own pocket for each claim; some companies let you choose a deductible and reduce your premiums (by a smidgeon) based on the deductible you’ve chosen; with other plans, the deductible increases as your pet ages. Keep in mind that low premiums with too-high deductibles just aren’t worth it.
• co-pays: the plan pays up to 80% (or whatever your plan pays) and you pay the difference
• discounts for multiple pets
• coverage for pre-existing conditions: some plans will cover if the condition has been completely cured; other plans consider genetic conditions to be pre-existing. For example, Doberman Pinschers tend to suffer from Wobbler’s Disease and cardiomiopathy so those might not be covered for your Dobi.
• coverage for cancer
• coverage for sterilization
• coverage for preventative care: which would take care of your vet visits (most plans require at least an annual vet visit to keep the plan in effect)
• monthly cost: costs vary tremendously with the type of plan you sign up for, running anywhere from $10 to $100 a month. Basic plans cover the costs of accidents (like being hit by a car) and some common illnesses like eye and ear infections. Top of the line coverage may cover routine preventive care (such as vaccinations and neuters/spays) and even alternative therapies like acupuncture and hydrotherapy. Some even cover the costs of cremation or burial of a pet, and include extra coverage upon accidental death. (You should also check to see if the premium will change after you’ve taken out the plan, and by how much.)

I got quotes for insuring one of my puppies from a variety of sources and it looks like it might cost about $60 a month for a good level of coverage. And since many of the plans I looked at have a cut-off when the dog turns 8, after spending almost $6,000 in premiums, I’d be back on my own. Also my last Bichon Frise, Sabrina Sabu-Yabu, never had a day of illness and lived 14 great years, so the breed may be hardy enough to not require pet insurance.

So I’m looking for some feedback. What’s your experience been with pet insurance? Worth it or not? And were there any surprises when you tried to make a claim or after you had had the plan for a while?

One of the couples I worked with is setting some bad examples for their kids. He is stressed out by work, by the debt, by his failure as provider and gets angry quickly. Then he begs forgiveness by buying his daughter something. Mommy is substituting spending for doing, dropping an average of $150 a month at the local dollar store on crapola. Geepers creepers.

This got me thinking about how complicated we make our lives with our children. We want to make all their decisions, creating total dependency, and then we whine because they can’t do anything for themselves. We’re so obsessed with them not making a mess we won’t let them pour the juice. We’re so nuts about the image they’ll create we won’t let them wear mismatched socks. We’re so focused on them having fun, we don’t let them have any downtime to just goof off.

I’m not sure when parenting became a University course, but it has. Just look at the proliferation of books on the subject – mine included, on how to teach kids about money – and you’ll see that raising kids is such a complicated thing we need to have a doctorate to do it right. 

How about some simple rules, which not only apply to teaching kids about money, but also to teaching kids about life.

Rule #1: Remember that they’re always watching you. You know that old saying, “Do as I say, not as I do”? Well, kids learn from what you do. Shop without a list and they’ll learn that when you go into a store it’s to impulse shop.

Rule #2: It’s just as easy to learn bad habits as good ones. Browsing serves a purpose. Unfortunately, in our time-pressured world, we haul our kids in and out of stores, seemingly without purpose, always buying something. If you never leave a store without buying SOMETHING, your kids will quickly learn that their purpose in going into a store is to find something to buy. You can’t then turn around and say, “Do you think we always have to buy something?” because the answer is, “Yes.”  That’s what you’ve taught them. Bad habit. And all because you don’t follow…

Rule #3: Explain everything you’re doing. Yes, it can become tedious, so it doesn’t have to be EVERYTHING, just most things. You can’t take cash from a cash machine without explaining how it works or your kids will think, “the machine just gives you money.” You can’t write a cheque without explaining how it works or kids with think, “cheques are money.” You can’t leave a tip on a table without explaining what you’re doing or your kids will think ,“Mommy forgot money on the table, I better pick it up.”

Rule #4: What goes around, comes around. If you’re truthful with your children, you have the right to expect the same from them. But if you lie, obfuscate, and only tell part of the story, why would you expect any less from them. Remember rule numbers 1 and 2? Hmmm.

Rule #5: Keep it simple. The more complicated you make something, the harder it is to deal with. Complicated outfits mean kids will get it wrong and look dumb. Simple colour combinations help them get it right.  Complicated rules for how kids can get and use their money are hard to understand and keep straight.  That why the Magic Jars work so well (for both kids and adults); the system is simple to understand and use.

Rule #6: Don’t try to do too much at once. Over-scheduling kids lives doesn’t make them happier. Kids need down time to just hang, think, imagine, process, cope. And jamming a whole bunch of money lessons into a day, week or month won’t work either since time is important for practicing and processing. Here’s a line from a Joanie Mitchell song (or was it Joan Baez?)… “Take your time or time takes you and drains your soul away.”

Rule #7: Prepare your kids. Telling your kids what you’re going to do helps them create a mind-map of what’s going to happen. Ditto teaching them about money.  Lay out what you’ll be teaching them before you get into the actual lesson so they know what to expect. If you’re going to teach about allowances, tell them you’re not going to get into loans, advances, work for pay or all the other stuff that can make the discussion really complicated, you’re just going to be talking about how much, how often, and what they can do with their money.

Rule #8: Be prepared. Just as you wouldn’t dream of heading out without bag of clean-up stuff and a set of nibblies to hold hunger at bay, you also have to be prepared when you’re teaching kids about money. Don’t trying giving a kid her $7 in allowance using a five and two ones. How will she put away her 70¢ for saving, or divvy up money between her Planned Spending (for that new CD) and her Mad Money?

Rule #9: Routine is your friend. Keep switching the day when you give the allowance and watch your kid eye you suspiciously. Forget to give the allowance and you’ll prove you’re not trustworthy. Change the rule on how the allowance can be used based on every new situation and you’ll teach your kids you’re a scatterbrain.

Rule #10: Know when to let go. It’s not worth all the hassle to get on your kids’ cases about everything. Know when to let things go and just relax. As long as you deliver a consistent message, love them and have their best interest at heart, they’ll turn out fine. If you’re doing anything “because of the principal of the thing”, it’s because you’re too lazy to weigh each decision on its own merit.