Monday marked the end of the last budget cycle of my employed life. My budgets run from the 20th to the 20th, timed to follow American Express’s billing cycle, since I charge everything other than recurring monthly bills and then pay it in full each month. This provides a nice annual kickback, usually around $250 of “free” money that goes direct to savings.
Knowing that my base net income of Social Security and part-time teaching will come to about 57 percent of my current net—and that from net I’ll have to pay eleven times for Medicare what I’m now paying from gross for comparable healthcare coverage—I’ve been cutting the discretionary budget a little at a time. It’s gone from $1,500 a month to $1,200, then to $1,000, and it now stands at $800, about as low as I can manage and still eat.
(And as I write this, I realize the figures I posted yesterday were bizarrely wrong! If you believe what I wrote then, you’d come up with a net unemployment income of 70 percent of my present net salary, which is dead wrong. Where on earth did I come up with a figure of $32,900 for my present net income?)
So, back to the budget: I’m reducing discretionary spending by 53 percent, which, because there’s not a thing I can do about regular monthly costs such as utilities (cut as low as they’ll go right now), taxes, and insurance, will cut my living standard significantly but still not cut the mustard. Oh well…
This month being Christmastime, as usual I’m over budget, though not as seriously as it looks.
Not realizing that M’hijito was taking two days of vacation time this week, I went with him to Costco on Sunday, by way of stocking up for the big bash we’re throwing on Christmas day. As a result, I charged up $133 at Costco and another $35 at Costco’s gas pumps, pushing me way over budget. If I’d waited until yesterday, I would’ve finished the November/December budget cycle $10 in the black. Instead, I’m $158 in the red, against the $800 “practice” budget:
Fortunately, I didn’t change the credit union’s automatic transfers of $1,500 a month into my credit-card budget piggy-bank, and so the truth is that account holds not $800, not $1,000, nay not even $1,200 but a whole $1,500. This means that in spite of the extra cost of the glasses I also purchased this month, I’ll have plenty to cover the total amount charged up on the American Express card.
But next month… Next month the New Regime starts in earnest. And given the revelation that my figures for net income were way too optimistic, obviously I’m going to have to stay within the $800 budget, and probably well within it.
Given the costs of running the house and owning a dog, that’s an unreasonably constrained budget. It looks likely that, unless a miracle happens, within the year I will have to sell my house and move out to Sun City, where taxes are 50 percent lower and insurance is about 30 percent lower. May have to find a new home for the dog, too.
I just knewI wasn’t gunna get away from the Great Desert University without at least one more thrilling episode.
This week I started using up the 176 hours that constitutes the use-it-or-lose-it part of my accrued vacation time. I entered 40 hours in the annoying online form PeopleSoft makes us use, leaving a balance of 304 hours.
Comes this message in the e-mail from our bidness office manager:
I am trying to finish up your vacation payout and need to know besides the 450 hours you took last week if you plan to take any more time this week or next. I want to make sure what I submit is correct.
Wow, did I get these figures wrong! My take-home salary is far more than what appeared in the original of this post…I don’t know where I came up with a figure of $32,900. I was even sober when I wrote this! Corrected figures appear in boldface next to my original wrong calculations.
Well, it’ll be interesting to see what happens next. In 2010, my gross income will be significantly less than half of what I earn today. Assuming state and federal taxes total no more than 20 percent (a big assumption!), the combined net of Social Security and teaching will be $9,700 ($17,710) less than I net from my salary today. That doesn’t count what I make freelancing, because next year I will not be allowed to earn freelance income. Since Social Security’s rules will limit me from earning a living wage, 2010 will be a year of real penury. It remains to be seen whether I can survive under those circumstances.
By “survive” I mean “stay in my home, eat, keep my dog, and live through a 118-degree summer.”
There are a couple of extenuating circumstances.
I’ll get a chunk of vacation pay that should net out to about $3,965 (assuming GDU doesn’t pull another of its numbers on me, another Big Assumption).
About $1,900 remains in the S-Corporation, after paying for the MacBook. If I can finish the page proofs I’m reading before Christmas, I could in theory push the 2009 drawdown to about $2,200. It probably would be better, though, to delay that job to 2010, so as to leave its payment in the corporate account to cover things like printer ink and computer repairs with nontaxable money. So, let’s say I net about $1,500 from what remains of freelance income.
This will give me a grand total of $28,985 (net, if taxes are not too extortionate) to live on next year. Compare that to my present net of $32,900 ($41,210).
Two strategies may enhance things a bit:
Even though I hope to avoid drawing anything from retirement savings in 2010 (so as to wait and see if investments continue to recover from the crash of the Bush economy), to have the state consider me “retired” so that it will disgorge the $19,000 it owes me for unused vacation time, I will have to draw a few bucks from my 403(b) until such time as the bureaucrat in charge of that program approves me. So the plan now is to draw down $500 a month until we know the sick-leave payment has been approved. That process can take as long as three months, and so I’ll probably have to pull out about $1,500, adding (optimistically speaking) another $1,200 net to the 28 grand.
Now we’re approaching a net of $29,200 ($30,185), which is $3,700 ($11,025) less than I bring home today.
My share of the mortgage on the Luke house will be paid with $10,000 worth of tax-free dividends from an antique whole life policy, giving me a year’s reprieve on having to draw those payments down from savings.
Still…where is that $3,700 ($11,025) shortfall gunna come from?
Well, I put $573 a month into savings right now. That adds up to $6,800 a year. Of that, only $3,900 is nonnegotiable: I have to self-escrow that much to cover the property tax, homeowner’s insurance, and car insurance. So if that’s the only money I set aside, in 2010 I can devote $2,900 to living expenses that I used to put into savings.
So, now I’m only $800 ($8,125) short of the amount I actually spend on living expenses. That, I’m sure, can be managed through frugality and tight budgeting. (Yeah, right! Only if I sell my home and take up residence under the Seventh Avenue Underpass!)
This scenario applies only to 2010. If I have to continue refraining from drawing down savings in 2011, then things will look different. I can earn about $10,000 a year freelancing—in a good year. So the net of teaching three-and-three will come to $11,520 (in the unlikely event that taxes don’t rise much); the net of Social Security is about $12,000. Add net freelance income of around $8,000, and you get $31,250 ($31,520) as the base net income, not counting savings drawdown, in 2011.
On the surface, that’s not too bad—pretty close to what I’m earning now. (Holy Hell, it’s over ten grand less than what I take home now!) But it doesn’t count the cost of Medicare, eleven times what I’m paying for health insurance today; and it doesn’t count the cost of the mortgage, which on its own represents about 1 percent of my total savings. (I am screwed, screwed, ge-screwed!)
And we have to remember that taxes and insurance will not stay the same. On the federal level, sooner than later we’ll have to pay the cost of repairing the damage done by the past decades of ill-advised leadership. Locally, the state is still a phenomenal $1.4 billion short, even after the Draconian budget just passed by the legislature. If the most basic services are to stay in place—firefighting, police protection (forget services to the sick and elderly poor)—then our dim-bulb legislators must face the fact that they will have to raise taxes. Homeowner’s insurance, too, never goes down; and when I reach the point where I’m forced to replace my 10-year-old car with a newer model, taxes and insurance on that will increase, too.
If my investment advisers are right that my savings will return to something resembling their former glory after a year or so, then I should be able to get by on a 4 percent drawdown…as long as I can dodder into a classroom. (Dream on!) That, of course, will not be forever.
But the day after tomorrow will have to take care of itself. (By then I’ll have starved to death, so someone else can figure out what to do with the day after tomorrow.)
I must have figuredmy income on a 24-period basis rather than the actual 26 pay periods created by PeopleSoft’s hideous biweekly pay scheme, since I bank the so-called “extra” paychecks in savings. Even that is wrong, though: the annual total would be $38,040. What hat the $32,900 figure came out of, I can’t imagine!
This is one of SDXB’s specialties, something he found years ago in a newspaper under the title “Ivory Coast Ginger Punch.” It’s easy to make and incredibly delicious.
Here’s the original recipe:
4 cups unsweetened canned pineapple juice
4 cups water
1/4 pound fresh ginger, scrubbed and cut into one-inch chunks
1/2 cup lemon juice
3/4 cup sugar
Mix the juice with two cups water in a large bowl. Whir the ginger in a blender with the remaining two cups of water. Pour the puréed ginger and water mix through a wire strainer into the pineapple juice, squeezing as much liquid as you can from pulp. Discard pulp. Add lemon juice and sugar to taste. Pour the punch into a pitcher and cover; chill about two hours or as long as overnight. To serve, stir and pour over ice to serve.
Personally, I’m less than fond of canned pineapple juice, which has a metallic flavor, so I came up with this variant, using frozen juice:
a large container of frozen pineapple juice
water
about 1/4 to 1/2 cup sugar
juice from one or two ripe lemons
a good-sized chunk of ginger, cut up into 1/2 to 1-inch chunks—the more, the zingier
All these measurements are to taste, BTW. For example, pineapple juice starts out pretty sweet, to my mind, and so I don’t think it needs 3/4 of a cup of sugar(!). But if you’re a steady soda pop drinker, you may want it sweeter. Experiment.
Put the pineapple juice in a blender. Using the empty juice container as a measuring cup, add a container of water. Add the sugar and the ginger. Now purée the bedoodles out of it. Purée as though after tomorrow there will never again be a blender in this world. Once the combination has morphed into a smooth liquid, pour it through a strainer into a pitcher. Using the back of a spoon, press the liquids out of the solids that collect in the strainer.
Add three more containers of water. Taste. If you like, add a little more water. Squeeze one or two juicy lemons into the punch. Stir. Taste again. Add more sugar or lemon juice, to taste. If you have a lime, some fresh lime juice also is nice.
This stuff is irresistible. It’s great for kids and teetotalers as is. You will find, though, that it calls out for rum. Use caution! It’s so easy to swizzle down that spiking this punch could put your guests face forward on the floor.
Woulda sworn I had a photo of this, but noooo…. So here’s a Christmas photo. All the neighbors have their Christmas lights out, but the hands-down favorite is the Burning Bush. Every year this guy climbs up on a skyscraping ladder and wraps his tree from its topmost limbs to the base of the trunk in layers of lights. He has so many lights wound around the tree that he can change colors: one night it’ll be blue, another green, another white… This particular evening, he had several colors on at once.
Well, this is going to be a busy weekend! We have 15 people coming for Christmas dinner, with another three tenuously invited (they’ll come for wine and hors d’oeuvres, at least). So this weekend M’hijito and I need to get together, buy food and choreograph a strategy for cooking and serving a mountain of food around all the other things going on.
He, of course, also has to attend his father’s Christmas. I was surprised to learn that his dad didn’t know about the jamboree casa mia, and so evidently M’hijito plans to show up there with as little fanfare as possible.
Complicating matters, SDXB is driving into town to attend the midnight service at the Cult Headquarters, where I will be singing for two chivarees, one earlier in the evening and one in the middle of the night. He’s planning to stay overnight and then join us for the dinner party.
To my great delight, we’ll be singing the Biebl Ave Maria on Christmas. We did it for the Lessons and Carols service a week or so ago, and so I thought our director wasn’t planning to have us do it for the midnight service. It is beautiful beyond belief, and so I’m pleased SDXB will be able to hear it. As a crazed right-wing aging RC, he still pines for the Latin mass. He should enjoy the midnight chivaree, which is about as high church as American Anglicans can get. Our pastor like to chant the Eucharist, and when you combine that with the best music the choir director can pull together (and he being who he is, that’s pretty amazing) and with censers censing and bells ringing, SDXB should feel right at home.
At any rate, after singing until after midnight, I’ll have to get up early and fix something for him to eat for breakfast, since he won’t go out to eat. Then race to prepare the house for the shindig. Meanwhile the choir director is having an open house that we could (read “should”) appear at, and one of my RAs may show up here with her two little girls for wine and snacks. Hm…this means we’ll need to have something for the girls to drink…maybe I’ll make that pineapple punch, which everyone loves and can be spiked with rum one glass at a time for the grown-ups.
Darn! I thought I’d posted that but can’t find it. I’ll try to find time to put that recipe up between now and Christmas.
Other alternatives for the small fry and the young mother With Twins: fizzy lemonade, virgin English majors (is there such a thing?), frescas made with frozen raspberries or cherries. Hmmm… We could make any of those things, really, as punch for everyone, and then add booze to individual swiggles for those who want it.
