Budget: Busted, Disgusted, and Can’t Be Trusted

Ugh! My desk is groaning under the piles of paper that have flowed in over the past three weeks. Did most of the bookkeeping to update this month’s budget, and now, thanks to a $205 pool repair bill and the $180 for the (discounted!) air conditioning contract, I’ve got all of $140 to live on between now and the 20th.

Emergency savings, set aside to cover the constantly recurring pool bills and similar little urgencies, are down to $1,300. That account normally hovers around $2,000. So I’d like to avoid having to draw more money out of that during this budget cycle…especially since, on the 21st (first day of the March/April cycle) the car has to go in for an oil change and to figure out why it’s tweeting out of its left front wheel. That’ll be another $200 to $400, you can bet.

Power, electric, water, food, taxes, and gasoline bills are all up—yesterday a little over half a tank of gas set me back $40—but my income certainly isn’t. Social Security rose a few dollars last January, but that was it. Adjunct pay never increases.

Luckily, this week is spring break, so I won’t have to drive around very much. Enough food is stashed in the fridge and freezer to last a week or ten days (I think…). Thursday I’m driving out to Sun City to meet SDXB and drive up to meet our friend La Maya at her weekend place in Yarnell. We’ll take his car, since I’m afraid mine won’t make it up the 2,500-foot climb. I wouldn’t take it into the desert at all these days, much less up Yarnell Hill. We’ll fly up to the old mining town, schmooze with La Maya for a few hours, and then fly back down the hill to his house, where we’ll meet his friends for a dinner of pasties, which he’s been planning for some time.

And that will be my only excursion for spring break. Or for anything: it’s been months and months and months since I’ve gotten out of this place.

Dang, but I’m tired of pinching pennies! I want this job so bad, so I can have just a few more years of a normal life. So many things I can’t afford are piling up: a new(er) car, paint jobs inside and outside the house, orthodonture on the twisted teeth…just to be able to get one of those things done would help. And I’m tired of being cooped up in this house. A walk around the park a vacation does not make.

But have to be realistic about my financial future: the likelihood of the school hiring me—an old lady already on Social Security—into a handsomely paid full-time faculty position is nil.

The accountant is about done with my taxes. I’ll only get about $1,800 back, from which I’ll have to pay her bill. Usually I get around $4,000, and I was counting on that to help refill the Survival Savings account. February’s RASL payment brought it back up to where it was eight or ten months ago, but that was the last of the three annual payments the state owed me for unused sick leave. So without that and with income taxes increased by $2,200, Survival Savings will last about eight months, at which time that little fund will be drained to zero. Then I’ll have to start drawing down retirement savings to make ends meet. Social Security covers less than half my base monthly expenses—significantly less than half, with all those increased bills.

Though net worth looks pretty good, certainly compared with that of most Americans, there’s really only $546,000 to support me through my dotage. And that’s likely to be quite a while: women in my family have lived into their mid-90s—and they were Christian Scientists. They did 100% without medical care. Imagine how long someone with those genes could live into the 21st century, with passing medical care, a lifetime of good nutrition, and no really grinding work. Assuming, though, that I only live to 95, starting a drawdown now is likely to run me out of money before I die. And a 4% drawdown is about $500 a month short of the amount I need to stay in my home and cover my present pared-down expenses.

The real estate class starts next week. That’s gonna make for five weeks of Tuesdays and Thursdays from Hell, but at least it will get over quickly. Relatively. I sure don’t look forward to having to sit in a classroom taking coursework. I spend enough time in classrooms, thank you. And to have to race home from class on T-Th, bolt down dinner, and race back out there to listen to someone drone on into the night does not appeal. However…one does what one has to do. Unfortunately, the other semester of this regimen isn’t offered during the summer, at least not in the junior colleges. You can take all three courses required for a license at a propriety school, to the tune of hundreds of dollars. But since my tuition waiver gets me into each class for $15 apiece, that seems counterproductive.

On the other hand, the longer I have to string out these courses, the longer it’ll take to give myself a shot at some other job.

Not that there’s much promise in those precincts. My mother had a real estate license. She sold exactly zero houses and earned exactly zero dollars. In the course of this career, she sandblasted the paint off the Mercury, driving through windstorms between Long Beach and the Salton Sea. God only knows how much she spent on gasoline to get back and forth between those two armpits. And she spent untold numbers of hours sitting in open houses, bored stiff.

So. I don’t have much hope for this endeavor. But…nothing ventured (etc)…

Garden spot at Salton Sea

Image: Abandoned, salt-encrusted structures on the East shore of the Salton Sea. GregManninLB. Wikipedia Project. Public Domain.

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E. Murphy March 12, 2012 at 8:19 am

I thought you were planning on downsizing. Isn’t that still in the cards?

If you can live with no pool, that should be a significant monthly savings.

funny March 12, 2012 at 9:22 am

@ E. Murphy: I just don’t see how I can afford to move. There is NOTHING in the areas where I want to live that costs any less than what I’m living in. The problem is, this neighborhood is probably the only affordable area in North Central that’s not pretty blighted. Houses in middle-class neighborhoods here cost the same as mine when they’re short-sales or foreclosures, and they’re not as nice. Scottsdale is out of the question; Arcadia is out of the question; Biltmore is out of the question. In the aftermath of the recession, the far West side has some affordable newer houses, but I really don’t want to spend the rest of my life under the flight path of the F-16s (and soon, even noisier F-35s) blasting out of Luke Air Force Base.

When I sell my house, I’ll have to pay a 4% to 6% realtor’s fee, much reducing the amount left to pay for another house. I’m not takin’ on another mortgage, so that limits choices, mostly to some pretty crummy places.

I could afford to move to Sun City and could live there more cheaply. But every time I go out there, I get depressed. If I had to live out there, far away from my friends, too far to drive to choir two or three times a week, and a long grueling drive to the campus, I’d probably act on the thoughts I’ve already considered about bringing a stop to all this shit. Frankly, I’m not in a big a hurry to shuffle off this mortal coil, but neither am I inclined to plod on through endless years of misery. And I’m certainly not going stretch it into my 90s that in some venue like Sun City.

Last year the cost of the pool averaged $8.49 a month, above and beyond water and electricity. Running the pump probably adds about $10 a month to the power bill. At most, the pool adds about the same to the water bill — much less in the winter, when evaporation is minimal. So we’re looking at a cost of at most $29 a month, as long as I maintain the pool myself, which is not very hard. Thirty bucks a month is really pretty modest. It’s significantly less than the cost of a cell phone.

When the time comes to replaster, though, I’ll be looking at a $10,000 bill. At that point, it may be worth thinking about filling it in. My neighbor’s (very affluent MD) son filled his in, once the kids were gone. That area could be quite lovely with a fountain beneath a nice big paloverde. From what I can tell, filling in the pool and relandscaping would cost about the same as replastering. Ten grand is a lot, but it’s less than selling this house and moving would cost.

frugalscholar March 12, 2012 at 9:57 am

I have a husband who is willing to do a lot of stuff–huge savings right there. Could your son do a thing or two around the house–you could pay him, but at least the money would stay in the family.

funny March 12, 2012 at 10:12 am

There’s an advantage to staying married. ;-)

M’hijito helps out now and then. But he has a grinding job and he’s pretty possessive about his private time.

Budget Glamorous March 12, 2012 at 11:23 am

Hopefully the other house you’re holding onto will get back on the right side of the market and you can be freed from that expense. I imagine that would help a lot.

I’ve had budgetary related feelings of despair since I was a very young woman with a very little baby. It is sometimes hard to see if and when things will get better. I am painfully aware that I’m one small disaster away from flat broke. I need to get a tree removed, my roof needs reshingling, the little loyal car needs replaced, still paying on the boy’s faceplant in the basement. Life never stops. The best I can do is put my little pennies aside and hope life doesn’t take too many of them away.

If it’s any comfort, you’re a real inspiration to read. You’ve made me laugh so loudly my cats were disturbed. You’ve given me things to think about. I appreciate that.

funny March 12, 2012 at 1:13 pm

@ Budget Glamorous: Yup.

Mechanic says my car should run another 50,000 miles, and some people say Toyotas can run relatively trouble-free for 200,000 miles, if cared for — that would give me another 80,000 miles before it really has to go. Still…I’d like a car that doesn’t make me nervous about running up to the northern part of the state.

Can you get someone to repair the shingles? Sometimes the underlayment is still intact enough to survive another few years, if loose shingling is patched.

LOL. Things could be worse: We could be living at the Salton Sea…

E. Murphy March 12, 2012 at 2:23 pm

OT for sure, but do you remember in the late ’50s when the Salton Sea was THE place for……….what, I don’t know? A resort house? A vacation destination? What was it supposed to be?

Anyway, it was highly advertised, and as a little kid in the LA area I was fascinated with living in such an “exotic” place. But my parents were working class and a second home was not in our budget.

funny March 12, 2012 at 2:53 pm

@ E. Murphy: Yes, it was much plumped during the 1960s, too, as “the next Palm Springs.” The Realtor my mother took up with was one of the people doing all that high-pressure marketing.

One hesitates to call it a land fraud, but it certainly was pretty silly. The saline pond that is the so-called Salton Sea rests directly atop the San Andreas fault; said pond came into being when heavy rainfall caused the Colorado River to overrun the headgates of an agricultural canal system, pouring unholy amounts of water into a dry riverbed. A large quantity of this water filled an ancient, dry basin, but because it had no outlet and, in the hot, dry climate, an extravagant evaporation rate, the water grew more and more saline. It was, in short, what we could call “a stagnant puddle.”

But there’s one born every day, and so some developers figured they could sell lots and houses on the, uhm, “beach” of this “sea.” They built a marina and laid out tracts. And amazingly, some people fell for it.

A hotter, more godforsaken spot can hardly be imagined, this side of the surface of Mercury. It was incredibly hideous. Your parents’ escape from this scam probably had more to do with brains than with budget. ;-)

frugalscholar March 13, 2012 at 4:56 am

Hey Funny, check this out: http://online.wsj.com/article/SB10001424052970204653604577251232717986316.html?mod=WSJ_hp_MIDDLENexttoWhatsNewsThird

Not sure if the link will work, but it’s a WSJ article on rebound in Phoenix home prices. Subscriber only, but if you do a search, you can often get a guest pass into the article.

It doesn’t change your day to day budget issues, but it may change your mood (a little!).

funny March 13, 2012 at 7:03 am

@ frugal scholar and readers: try this link: http://online.wsj.com/article/SB10001424052970204653604577251232717986316.html

Or google Timaros “As home prices continue to drop in most cities” with quote marks around the phrase but not around the reporter’s name.

This reflects exactly what is being said in my business networking group. We have a Realtor, a mortgage broker, and a couple of guys in insurance and investment, and they’re all saying the same thing. The Realtor says the city now has a shortage of houses in the $100,000 range, and that shortage is quickly moving toward the $200,000s. Bidding wars are pushing up prices, and buyers are snatching houses so quickly he can’t get his customers there fast enough.

Unfortunately, as the Journal article suggests, people are buying these places to convert them into rentals. While that’s better than an empty, vandalized hulk, it’s still not good for neighborhoods. We certainly have seen that in this area, where the Perp moved in to this 3 x 3-block tract, bought six houses from their elderly owners at rip-off prices, and filled them with renters on Harleys who were giving to parking semi trucks on the front yard. Even in the slump, houses a block away that are not in this tract sell for $50,000 more than ours; in good times, they sell for $100,000 more, even though they’re older, smaller, and not as pleasantly designed. Asked why, a Realtor once said to me, “It’s the neighborhood.”

This is the result of turning a large proportion of single-family homes in an area into rentals.

Except in a few small districts, Phoenix is already a dumpy, unattractive city. Most of it is dusty, tired, and blighted. Public schools are laughable. The middle class has moved out, to suburbs in Scottsdale, the far East Valley, and the far West Valley. They left behind a large underclass; a smaller working class of people with decent jobs but who are stuck in houses worth less than they paid for them; and four enclaves of affluent lawyers, business executives, and doctors who do not care to commute and who can afford private schools or who have no kids. Except for those four enclaves, most of the neighborhoods here are scruffy and ugly, or, like my son’s and mine, they abut dangerous slums.

Filling the few remaining safe, well maintained neighborhoods with rentals will serve chiefly to spread the blight to those neighborhoods.

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