Coffee heat rising

Moments of Fame

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BankerGirl does an awesome job of hosting the169th Carnival of Personal Financeamid a frenetic schedule that includes planning a wedding, a big workplace project, and teaching. She kindly included Funny’s rumination on the real cost of an intellectual worker’s overhead. Among the amazing editor’s picks, check out what Bob is up to at ChristianPF: the guy isconverting his car to run on water. On a subject near and dear to my heart, over at Moolanomy Pinyo considers the benefits ofcollecting one’s Social Securityat the earliest possible moment. Harvesting Dollars wondersif you’ll really spend less in retirementthan you do while you’re working (IMHO: if you’re already frugal and you don’t have to buy special clothes for work or eat out for lunch, probably not). Quest for Four Pillars adds to the retirement discussion withan interesting rumination on the 4 percent rule; here, too, readers add some useful insights. If you like your cookies frosted, check out My Dollar Plan’s discovery that the $7,500 first-time-buyer’s tax credit is sadly misnamed. And speaking of financing real estate, My Two Dollars wonders how to go aboutgetting a mortgage when the largest part of your income is from freelancing; though I thought it was impossible, several of his readers offer solutions. Well, speaking of retirement dreams and mortgage schemes, it’s time for me to get up and go to work: don’t miss this carnival, ’cause it’s full of outstanding posts.
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Frugal Babe hosts this week’s Festival of Frugality, where Funny’s squib on Ikea appears. My attention was instantly caught by Jacob’s post at Early Retirement Extreme about saving big bucks by moving into an RV; just last night while walking the dog I passed by the RV that usually appears in front of one of the neighbor’s homes this time of year and thought…that could be the answer…. Speaking of mobility, you have to see the amazing Thriftymobile at Miss Thrifty. The Happy Rock has decided to buy real food instead of processed & prepared gunk at the grocery store…oops, sorry. We shouldn’t call it “gunk,” it being against the law to slander foodstuffs these days. Hank at MiB has come up with an interesting hack involving Costco’s cash cards.
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At Funny’s sister blog, The Copyeditor’s Desk, the 76th Carnival of Money Stories has gone live. My favorite posts there were FMF’s story about his kids’ views on paying taxes and Jim’s interesting remarks on Roth conversions and Blueprint for Financial Prosperity. Since I wrote this carnival, I’d like to point out that several people who submitted posts to the Money Stories carnival also submitted the same posts to the Festival of Frugality. One managed to be included in both round-ups.

The rules to most carnivals specifically state that entries should be original and submitted to only one carnival. I can see why you would hedge your bets with the Carnival of Money Stories: so many people submit posts that aren’t really stories that a relatively small percentage of submissions are accepted. It really isn’t difficult to tell the difference between a narrated story and a list of tips, though. Why not simply submit the “5 Ways to Save” posts to a carnival that’s looking for them and leave it at that? If you think you have an actual story, send it to the Money Stories Carnival first; then if it doesn’t fly there, next week send it to the FoF or the CoPF.

Saved from my own fecklessness

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This weekend the fates conspired to keep me from spending money.

A week or two ago, while running around town with a friend who was looking for a particular combination of furniture, I came across some dining room chairs that exactly fit the description of the fantasy chairs I imagined would go with the table I bought four years ago. My mother’s kind of Shakery looking chairs work fine with this table, but I’ve always believed that a set of wheatback chairs with wicker seats would be just the ticket. When I got the table, I thought it would be fairly easy to find such a thing, but no! Months and years have gone by, and I’ve never spotted exactly what I wanted.

Until I came across these. They looked much like the one in the picture here, only in a nice medium walnut finish, not painted black; and the design is a little more polished. Perfect: $315 apiece, marked down for a moving sale.

Ohhkay….six of those would come to $1,890, plus 8.3% government gouge equals $2,046. A bit stiff, especially since I’d drained my diddle-it-away savings to buy the sideboard I’ve also been craving for the past several years. Four of them would cost $1,362. And there was some degree of hurry: the store is moving to a part of town that’s a long way from where I live, into an upscale area way too rich for my blood. I hardly ever go there; with the cost of gas where it is, I’m unlikely to venture out in that direction, even to get something I really want. Besides, the sales guy indicated the chairs weren’t about to sit around his floor for long.

So I dropped by on Friday and asked if I could buy just one on approval, to see how it would look with the set. No problem. Schlep this home, and…

Yeah, it looked really, really gorgeous with the table: like they were made to go together. But…

But the dining room is separated from the family room by a step up: the dining room is a slightly sunken room, so you make one step down from the dining area into it. Satan and Proserpine, the previous homeowners, took out the infelicitous wrought-iron railing that further delineated the spaces, creating a broad open area where nothing interferes with the sight line. The family room is the nicest and prettiest room in the house. When I sit at my accustomed spot at the table, I can look across the table into this lovely room with its big fireplace, skylights, Arcadia door, and handsome, simple furniture. I really like enjoying the view of the most pleasant room in my home.

Well, the chair backs are high enough that when you sit at the table, what you see is not the room but the back of the chair across the table! Nice chairs, but not what I want to gaze at while I’m dining alone. My mother’s chairs are low enough that they don’t intrude.

Saved from diddling away $2050 on unnecessary furniture! Back to the store the chair went.

Onward to more unnecessary objects: At Pier One, I recently bought some new dishes, my old set being scratched up and very tired. They’re mostly bright yellow, with blue trim here and there. To go with them, I wanted a set of cobalt blue placemats.

Think anyone, anywhere carries cobalt blue or navy blue placemats?

N-o-o-o. Not a chance!!!!!

After driving from pillar to post in search of a mat to go with the dishes, I finally found the perfect thing at Sur la Table. They had five. I needed eight. The saleslady called the catalog to order me three more: no way. She now suggests I drive halfway across the city to their other store to pick up the other three mats. I decide not.

While I’m walking around The Great Indoors, a repository of some of the most hideous products of the School of Ugly Design available anywhere, it occurs to me that one doesn’t really need table mats. Why use a placemat on a table whose surface is made of reclaimed European warehouse flooring, two-inch-thick slabs of polymerized pine with layer after layer after layer of dark wax rubbed into it? The thing is impermeable! A little water or wine spilled on it will wipe right up.I have a perfectly fine table cloth that can be used for guests.Why do I need placemats at all?

I don’t. Do you?

One less thing to spend money on. One less thing to have to wash and iron and put away.

We have a lot of STUFF in our lives that we think we need because we’ve always had them and our parents always had them and so that must just be the way things are done. Do you find that’s so? What’s in your home that you don’t really need?

To move or not to move…and if so, where?

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Yesterday’s confirmation of my suspicion that I won’t be able afford to stay in my home after I retire is disturbing. I will have to move someplace cheaper to operate. And if I need to carry a mortgage to do it, I’d better find a place sooner than later. No one will lend a house-sized chunk of money to an old lady trying to live on Social Security.

If I’m going to stay in the Phoenix area and not live in a three-story walk-up, there are only two choices: Sun City or a foreclosure in the city’s gentrified core. The city stands down off the property taxes in the historic district (the locals consider a house that’s 50 years old to be “historic,” a bit of a joke but hey…it’s Arizona). Right now three or four such shacks are on the market.

The historic area known as “Willo,” part of the larger Encanto district, is exceptionally well maintained and pretty: gentrified with a vengeance. My ex- and I lived there for 15 years. We moved after our son got big enough to play outdoors—surrounded with a blighted area boasting the highest per-capita drug use in the city, Encanto is infested with homeless mentally ill and dangerous criminals. We felt it was unsafe to let him play outside, particularly after one of the neighbors (yea verily: an elderly woman) was killed by an ax murderer. A woman living alone down there really needs a large dog. But (sigh) I suppose that can be arranged.

I saw two derelicts on Third Avenue as I drove down into the area this afternoon. One of them was so spaced, the poor guy, he was stumbling up the middle of the street. On the other hand, when I stopped to look at one of the vacant repo houses, I chatted with a yard crew. Their foreman said his company cleaned up and did handyman work for the bank that now owns the place. They were up on the roof the other day replacing parts in the air conditioner when two squad cars full of cops showed up and, pistols drawn, ordered them to explain themselves.

So that would mean the cops are showing up, something they rarely bothered with in the past. I remember the time The Walker, a mentally retarded gentleman who used to walk around and around the neighborhood, oblivious to the traffic on Third and Fifth avenues, from early in the morning when the settlement house tossed him out to evening when he could go back to bed. One hot day he passed out on my neighbor Chuck’s lawn. Chuck called 911 to get an ambulance for him, and the despatcher said—I kid you not!—”Don’t worry, he’ll sleep it off.”

They figured the old guy was a drunk, and they didn’t give a damn that drunks were passing out on people’s lawns. Chuck had to call the city, raise Hell, and put a block under it to get somebody to come take care of the man.

On the Night of the Screaming, it was an hour before the cops showed up. They almost arrested my husband, who appeared, coming home from a firm meeting, about the time a squad car surfaced. This was the time a rapist tried to come in the side door, having got himself all hot and bothered after he watched me, through a window, doing some calisthenics. I went to another door, threw it open, and started screaming “Fire!” LOL…didn’t know I even could scream that loud.

Anyway, the prospect of watching a house burn down brought the neighbors out, which scared our boy off. They watched him lam out of there on a bicycle.

That’s the neighborhood I’m planning to move back into. On the other hand, the mayor lives there now. That would explain the improved police presence. The city has long been anxious to gentrify that area, and these days people with lots of money have moved in. So…times may have changed in Encanto.

Because of the area’s exceptional charm (it’s actually the only charming district in the entire Valley—otherwise, all the housing is ticky-tacky sprawl, except for the huge and hugely expensive 1950s ranch houses of North Central), prices ran up very fast and stayed up, long before the Bubble. In 1968, three months after we moved into our very beautiful Santa Barbara-style house, a Realtor came to my door and offered $100,000 for it. We had just paid $33,000. Twenty years later, after I Ieft the marriage, I considered moving back into the area, but by then prices were utterly out of the question.

No more. The bust has brought prices for some very sweet little places back down under $400,000. If I can get three and a quarter for mine, I probably can afford as much as $370,000.

Right now an exceptionally pretty small house, shown above, is on the market for $365,000; probably the price can be negotiated down. It’s pretty tiny—1,488 square feet, compared to the 1,860 in my present hovel—but it has three (minuscule) bedrooms, an office, and, a valuable rarity in that neighborhood, an actual garage with a garage door! And a pool, freshly replastered. The roof looks new. The house has a new HVAC system…very big, indeed. The kitchen has been remodeled; the distressed owners left a restaurant-style gas stove and a big, brand-new refrigerator. Strangely, they built an outdoor fireplace on the far side of the pool, in a space too small for outdoor furniture; but it’s atmospheric, I suppose.

Three hundred sixty-five grand is cheap for that area. That’s $245 a square foot. Just down the road, on the street where our babysitters used to live, someone is trying to get $850,000 for this little manse: at 2,520 square feet, that comes to $337.30 a square foot. Now I will say, it’s a lot more elegant inside and out; it has a huge, fancified kitchen, the most stylish of all possible swimming pools, and a large, swell bathroom with a whirlpool tub. And no place to park your car. One extracts 2,520 feet from those places by converting the garage into a “guest house” (read “impossible to air-condition studio”).

Another place around the corner from where we used to live is on the market for $525,000. The seller boasts that the taxes are $1,780, significantly less than I’m paying on a house worth something around $300,000. Cute little fellow, isn’t it? It has a nice big kitchen, an office with handsome built-ins, big bright rooms, and the original tiling in the bathrooms, very attractive. At $228.25 a square foot, you get 2,300 allegedly livable square feet, again because the garage has been converted and you have no place to park your car. Understand, there’s no neighborhood in Phoenix where you can safely leave your car outside, and this particular high-crime area is not a place where you would want to leave your car sitting en plein air all night long. One of our neighbors popped out of her home one morning, jumped in her car to go to work, started to back out the driveway, and, turning around to watch where she was steering, found a derelict sleeping in the back seat. When she got her husband to evict the uninvited tenant, the man was indignant to have been awakened at such a ridiculously early hour.

The house I saw where I stopped to talk with the workmen was on the market for $270,000, having failed to sell at auction a week or so ago. The reason for that, I expect, is that it backs onto the commercial strip facing McDowell, a busy and loud main drag, so that the view from the backyard is the backside of some aged, run-down commercial buildings and their gigantic garbage bins. Needless to say, few people are willing to buy a fixer-upper of a repo for anything like what the bank wants to get for that thing. At any rate, while we were chatting I noticed a pile of broken car window glass in the street. The crew’s super said the car had been broken into while they were off at lunch. So: a garage is a nonnegotiable, as far as I’m concerned.

All these nervous-making issues notwithstanding, the area has many things to recommend it:

  • An amazing esprit de corps exists among the neighbors. People live there because they love the old houses and they love living in the central part of the city. They’re vital, young, and generally quite friendly. When we lived there, we knew and socialized with neighbors for three blocks around; in my present house, I haven’t exchanged more than 200 words with any of the neighbors except for La Maya and a lady down the street who has a dog about Cassie’s size.
  • The neighbors keep the houses up. Every yard is perfectly groomed. No one looks out her window to see anything like Dave’s Used Car Lot, Marina, and Weed Arboretum.
  • It is a lot closer to the Great Desert University than where I’m living. I could get to work in ten minutes flat.
  • The city has fostered a midtown cultural and arts district. The neighborhood is within walking distance of the main city library and two vibrant museums.
  • The train will go right up Central Avenue, four blocks from the coveted house. It will carry riders downtown and let them off within walking distance of the theater district, making it possible to enjoy plays and music without having to pay $10 or $15 to park your car for a couple of hours. There’s a baseball stadium downtown, too, for those who enjoy athletic events and can afford to watch them.
  • My friend VickyC lives in the general area.
  • Once the bust is over, property values can go nowhere but up.
  • Taxes are kept low (although nothing can stop the city and county from rescinding the special tax district).
  • It’s within walking distance of Phoenix College, where in my dotage I undoubtedly can pick up some classes to teach, to the tune of a couple thousand bucks a semester. This would be an easy way to pick up some pin money. Since the college has a writing program, I’m sure I can get hired to teach something less torturous than freshman comp.

The other possibility is to move to Sun City.

The biggest advantage of Sun City is price: it is extremely cheap to live out there. SDXB’s taxes are half of what I pay, and when he moved his homeowner’s and car insurance dropped to a third of what he was paying here. It also is very quiet and relatively safe—the crime rate is low, and since the notorious Sheriff Joe Arpaio knows that elderly right-wingers (which describes most of the populace) will keep him in office, he provides prompt and effective police coverage. The houses are built for old folks: many are intelligently designed, and they have lots of storage. Most have double garages. There are two big hospitals and several life-care communities, amenities one needs to think about as one ages.

For $300,000, for example, you can buy this place. Truth to tell, it’s a better house than anything in the price range in Encanto. It’s bigger, it’s newer, it’s in a safer area, it has an updated kitchen and interior, and it backs onto a golf course. Similar houses can be had for lots less: most of the sellers are either old folks who have been carted off to a nursing home or out-of-state heirs, both sets that fall into the “distressed” category. Houses are not selling in Sun City, with the result that every second shack is on the market. For $290,000, I could buy a place on a fake lake, with its own private dock.

And lo and behold, here’s a house with a pool, right on the golf course, with a kitchen best described as vast: it appears to be SDXB’s model, which is a nice house. It’s on the market for $259,900. I expect I could stand to live in this place.

So…why would I even consider spending $65,000 or $100,000 more to live in a smaller house in the noisy, crime-ridden heart of a big city?

Why, indeed?

Well, for starters, because it is Sun City.

  • It’s a ghetto for the elderly. I’m a big-city girl. If I’m going to live in a small town, I will move to a real small town, not a “planned community” that plans out the sound of children playing.
  • My politics lean to the left. Most elders in this part of the country lean to the right. Chances of finding sympatico friends are almost nil.
  • Sun City is full of couples. It’s difficult enough to make new friends when you’re old. But when you’re a single old person in a culture where people don’t care to have a fifth wheel along, it’s almost impossible.
  • Watching old movies does not strike me as a cultural event.
  • I can’t think of anything more depressing than watching the few friends I would manage to find grow more and more decrepit. While I enjoy friends my age, I also crave the acquaintance of younger people.
  • It’s way, way too far away from the university. If I can, I intend to keep my job another two to seven years. I wouldn’t want to make that commute every day for two weeks, much less for seven years!
  • My son hates it and has said he will not drive out there to see me.
  • The ‘burbs have moved west and surrounded the Sun Cities. As a result, the entire area is crowded, hectic, and crazy-making.
  • The Sun Cities themselves are’burbs: vast tracts of almost identical houses turned out of a limited number of cookie-cutter molds. They are ugly, dreary, and monotonous.
  • When you use the term “quiet” about Sun City, you mean the silence of the mausoleum.

So, while I’d love to turn a $40,000 profit on the sale of my house, I don’t think I’d like the trade-off. A smaller house in the central city would be less work for me to take care of and, with the taxes controlled and fewer square feet to air-condition, would cost less to operate. While I wouldn’t come away with the extra money I need to pad my retirement savings, expenses at least might be manageable.

It’s worth looking into.

Thank goodness! And . . . gasp!

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Two scary envelopes arrived in the mail today: one from the county tax assessor and one from my financial manager. I figured both would bring bad news.

And yea verily: even though the sale value of my house has dropped $50,000 over the past couple of years, the assessor’s biannual estimate of its value has gone up by $33,000, raising my taxes from the $1,500 I paid when I moved in about four years ago to almost $2,100.

However, this moment of gloom was relieved by a report from the redoubtable Stern and Reimer, who, despite the drumbeat of unnerving economic news, contrived to make my investments earn $2,265 in August.

LOL! Just about enough to pay the taxes!

In fact, I have the tax money in hand, accumulated by dint of a $300-a-month setaside from my paycheck. So I can pay the assessor this year. But next year: ????

The $3,600 annual impound into a savings account is to cover property tax, homeowner’s insurance, and car insurance. It used to cover annual car registration, too, but because my car is now eight years old, I can pay that out of cash flow. If my car were newer, I couldn’t do that.

Now the problem is . . . the combined cost of 2008’s property tax, homeowner’s insurance, and car insurance will come to $3,700.

And three hundred bucks a month is pushing the envelope of what I can afford to set aside. State employees received no merit or COLA increases this year, and will not as long as the economy is in the toilet. In the past, we’ve gone several years at a time with no raises whatsoever. So: they raise our taxes, but they don’t raise our pay.I haven’t retired yet, and already the basic cost of keeping the government from confiscating my home or my car and providing enough coverage to rebuild if the aluminum wiring sets fire to the joint is passing my ability to pay it.

What this demonstrates is what I’ve already begun to suspect: I will not be able to stay in my home in retirement.

If there was any question about that, this tax bill answers it, plain and clear.

Unbundled! Qwest strikes again

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So, I’m reading my Qwest bill and notice some long-distance calls to Austin, where I know exactly no one. I also want to find out what they want me to do with the useless modem the Filipinos sent and to cancel the $3.99/month roadside assistance plan that recently proved to be ludicrously useless. After dialing the customer service number printed on the bill, I again make the acquaintance of Qwest’s damnable robot, which eventually puts me through to one “Josh.”

Amazingly, this “Josh” speaks English. Yea, verily: he’s a native speaker. In the course of probably 40 minutes spent gabbing and wasting time on hold, I learn he grew up in Las Vegas and presently is living in Logan, Utah, where he works in Qworst’s call center to support his lifestyle as a ski bum.

The Josh brushes me off about the unidentifiable long-distance calls but agrees to discontinue the laughable roadside assistance disservice. Along the way, he remarks that he can save me money on the phone bill. Figuring he wants to sell me something (he does, but not till later), I rise to this bait. How, I ask, does he propose to do this?

“Well,” says he, “I see you have DSL, cell phone, and a land line. I can bundle them together, and it will save you $10 a month.”

“They are bundled,” say I.

“No, they’re not,” says he.

“The only reason I got the DSL was because Qwest sent an ad touting its cut-rate bundling. I called your company and specifically ordered the bundled service, and I was told that was what I got.”

“Look at your bill,” says the Josh. “If it doesn’t say ‘bundled service’ on the front page, then you don’t have bundled service.”

“The bill is unintelligible,” I observe. “None of it makes any sense at all. It is a document designed to confuse the customer.”

The Josh does not deny this. He proceeds to do the bundling thing, and now magically my bill drops by ten bucks a month. Not wanting this lucre to burn a hole in my pocket, he suggests I upgrade my cell phone service. I say I never use the cell phone and the only reason I got it is that pay phones have pretty much disappeared and I have to drive an aging car across a freeway to get to work; the cell is only for emergencies and I don’t need an upgrade. He then proposes I get their TV service. I say I don’t watch TV.

He is incredulous.

“You don’t watch television?” he squawks.

“No.”

“Never?”

“Never.” This is a slight exaggeration, but the Josh need not know it.

Discouraged, he now suggests I replace the old, perfectly functional modem with the new one, which I haven’t yet shipped back to Qworst. I say I’m not looking forward to fiddling with a CD and the connection, which invariably gets screwed up, and I can’t afford to be offline over the weekend because I have to do a blog carnival.

“What’s a blog?” the Josh inquires.

Beginning to suspect the man smokes something that doesn’t have nicotine in it, I ask him if he’s serious. He insists he doesn’t know what a blog is. I try to define blogging in one sentence.

He says for nine bucks, they’ll send a service guy over to install the modem. I say “sold!”

Now—get this!—he tells me I must immediately ship the free modem the Filipino staffer has ordered back to Qworst, so that the service dude can replace it with another modem, which will cost me $100. But lucky me! Qworst will be sending me a $50 rebate coupon!

Oh, thank you, honored phone company!

Not until I get off the phone do I realize that the Josh has figured out, during the course of conversation, that the modem in the box is the same kind of modem the service person will install, that at one point he subtly backpedaled to maneuver me into letting him replace it with one I have to pay for, and that the Josh probably gets paid by the amount of junk he can sell to the customer.

So here’s what we have:

In August 2006 I ordered what was presented to me as a bundled set of services. This “bundling” never happened. The result was that for the past two full years I have been overcharged $10 a month for a service that was misrepresented to me. That adds up to a $240 overcharge. More recently, I was made to jump through an hour’s worth of hoops while two marginally English-speaking technicians tried to figure out, over the telephone from their stations half-a-globe away, what was wrong with my DSL connection. Their assessment was wrong. Incorrectly thinking my modem was on the fritz (in fact, Qworst’s serviceapparentlywas down, something the company had not bothered to share with its men and women in Manila), they sent me a new modem, telling me it would be free of charge providing I shipped the old one back. This device is a newer model. A stateside Qworst customer service person smoothly switches out this free modem for an identical one, to the tune of $100, promising a $50 rebate. So, all told I’m out $290 in fraudulent and questionable charges.

Charming, eh?

If there was any question whether the robot voice expresses the disdain with which this corporation’s leadership views the Great Unwashed, interaction with Qworst’s live voices quickly dispels that.

What’s an intellectual worker’s real overhead?

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Over at The Copyeditor’s Desk, TM opines that a freelance editor working from home does business with a very low overhead: a computer, an Internet connection, appropriate software, some inexpensive paper, a few pens or pencils, maybe babysitting or day-care costs.

On a superficial level, I’d agree with that. But I’d like to argue that there’s a lot more cost behind editing, writing, graphic design, programming, and similar pursuits than just hardware, software, and some office supplies. The truth is, none of us can do our jobs without one very expensive piece of overhead: education. By and large, the more education the intellectual worker has, the more his or her skills are worth . . . but the higher the person’s overhead.

Consider what a good education costs. An undergraduate degree at an in-state public school can easily run you $15,000 to $20,000 a year. We paid $40,000 a year for M’hijito’s four-year degree at a private liberal arts college.

Two years of graduate school will take you to the M.A. (assuming you’re trotting right along): add another $30,000 to $80,000. A professional degree will set you back even more: the Great Desert University, which bills its law school as “among the lowest of all American Bar Association accredited law schools,” presents in-state students with a tab of $35,041 and bills out-of-state students $47,606. At GDU, a Ph.D. in a less marketable subject, such as English, runs from $7,052 a year for in-state students to $19,606 a year for out-of-state students (not counting books, housing, food, transportation, and personal costs); attaining a doctorate can take six to eight years.

So… A bright mind, a bachelor’s degree, and a few years of on-the-job experience probably will put you in a position to freelance as an editor, a writer, a graphic artist, or a computer programmer. Let’s figure the start-up costs:

Computer: $1,000
Printer/FAX/Scanner: $300
Internet connection: $360/year
Software:$300 (e.g., indexing program, etc.; assumes MS Office comes with computer)
Student loan: $8,724/year (approx: $60,000 repaid over 10 years at 8% interest)
Office supplies: $200
Desk: $300 (Ikea or other knock-down furniture)
Chair: $100 (Ikea or other cheap furniture)
Total: $11,984

Assuming you could bill 30 hours a week (a generous estimate, indeed!) and you needed a pre-tax income of $40,000 to live on, you would have to gross $51,984 a year to get by. Giving yourself two weeks of vacation time, you would have 1,560 hours in which to earn that amount, meaning you would have to gross $33.32 an hour: consistently and steadily.

This doesn’t count items that would be in your house anyway, such as a telephone connection, air conditioning and heating, water, and access to a bathroom and kitchen. And the biggie: it doesn’t include health insurance!

If you had a low-end master’s degree that you managed to complete in only two years, you’d add $30,000 to the cost of your training (assuming you count books, living expenses, & the like). What the heck: let’s pay that back in 20 years instead of a mere 10; at 8% that would run you $426 a month, or $5,112 a year. This actually brings your annual overhead down to a mere $7,672; to get that 40 grand of pre-tax income, you’d need to earn $47,672, or $30.59 an hour over fifty thirty-hour weeks.

Hm. What if you had a Ph.D.? Let’s say eight years of graduate school at $14,000 a year, since research assistantships and fellowships usually cover most of your living expenses. Again, you pay it back at 8% over 20 years: $936.81 a month, or $11,244 a year! This puts your annual overhead at $13,804. Now you need to pull in $53,804 to end up with a pre-tax, pre-health insurance take of 40 grand: $34.49 an hour.

In any of these scenarios, you’re having to earn $30 to $35 an hour and bill 30 hours a week consistently for 50 weeks a year. That’s to bring in an amount that’s just enough to call a living wage. Sort of.