Social security survivalist

We're unpacking books today.  I added a survivalist book to the retirement shelf - that earned me some strange looks.  But retirement is a challenging "maybe someday" planning process - not unlike survivalism, where one must contemplate threats both known and unknown, far off in the future, and prepare a plan for countering the threats that seem plausible.

So the survivalism book can get hoeky and weird, but it really is a retirement book.  Survivalists fear that the breakdown of society will lead to poor access to essential supplies.  Retirement planners know that the breakdown of the IRA balance will lead to poor affordability if essential supplies.  Same thing, different approach.  The personal security aspect of survivalism seems germane to retirement planning, as well, given that old age can usher in physical infirmities that make some elders more subject to abuse.

So I flipped through the survivalist book.  It talks about buying durable versions of common goods so that replacement/repair is less required.  That's a good approach to retirement planning, too.  Financially, the retirement plan should cover offense AND defense - offense is maximizing financial reserves and income, while defense is minimizing expenses.  Repairs by others take retirement income - a fractional reserve of the income earned decades before - and spend it on current wage rates.  There's GONNA be a disparity there that doesn't favor the retiree. 

Financial gurus like to talk about financial independence - the ability to survive without a job.  Retirement is forced survival without a job.  Good financial planning - on both the offense and the defense side - improve the odds of surviving with a decent standard of living.  Survivalists don't focus on maintaining access to European vacations, they focus on maintaining access to the basic necessities and minimal comforts.  That's the first step in retirement planning, too.

So, yeah, the survivalist book stayed on the retirement shelf in our bookcase.  Right next to "how to save a million dollars for retirement" and "how to retire with less than a million dollars."  Interestingly, both books spend some time on the need to live a little below your means.

How to lose a customer for life, or How I learned that AAA sucks (and alternatives to Triple-A)

Move, car starts acting up, call Triple A – oh, by the way, I moved, please change my address - - > Happy customer :-)

Have a lousy week, decide “I’ll take a weekend getaway!”  - - > Happy customer :-) Try to order a map from AAA but can’t because Triple A California won’t mail to Oregon, but AAA Oregon/Washington won’t serve me because my membership is still in California region  - - > Annoyed customer sends web request to AAA to please make the region transfer that was requested  MONTHS ago

Round and 'round she goes with AAA by e-mail.  Not such a happy customer.

Reply from AAA:  No. You must  prepay another year if you want us to mail you a map during your current membership period. - - > Take me off auto-renewal

Reply from AAA:  No.  You must have California take you off auto-renew. - - > Okay, and, hey, California, while you’re at it, cancel my membership and refund the rest of the membership period since I can’t use it anyway!

No Reply from AAA

So I call AAA.  Get very rude CSR.  Oh, we did process your cancellation, we just didn’t bother to tell you so**.  Oh, and we’re not going to refund the balance, it’s only refundable in the first 90 days.   

- - > Customer asks for copy of relevant membership contract that says it’s non-refundable – I was sure I remembered it being refundable at any time.  

CSR says no, you can go search our website if you want to, I’m not sending you anything.  - - > Disgusted customer doesn’t really give a flip about the $20 or so, just doesn’t want d-bag company to keep the money as profit on d-baggery, hangs up phone

Then CSR does send the refund policy.  Which means “nannie-nannie-boo-boo I’m right, suck it!"  Now I’ll include the e-mail exchange, because it’s short and pithy and, for anyone who ever needs to find the membership terms, there's a link, since Triple A CSRs get to decide whether or not to help you find it.

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From: AAA C"s"R

To: Fed-up Customer

Subject: RE: Here is the information you requested

http://www.csaa.com/membership/compare-our-membership-levels/membership-terms-and-conditions

2. Membership, Reimbursements and Other Policies

Refund Policy
AAA does not provide refunds on fees for enrollment, instant activation of ERS benefits or ERS calls beyond Membership coverage. We will provide a pro-rated refund on Membership dues at any time. If your refund is requested within the first 90 days of your Membership year, we will deduct any ERS charges incurred on your behalf. We pro-rate the refund of Membership dues for downgrades. 

(Note: Highlighting as sent by TripleA "Member Generalist;" Employee signature redacted in pity)
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From: Fed-up Customer

To: AAA C"s"R

Great, so please refund it.  That IS a period between “We will provide a pro-rated refund on Membership dues at any time” and the next sentence, right?

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From: AAA C"s"R

To: Fed-up Customer

If your refund is requested within the first 90 days of your Membership year

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From: Fed-up Customer

To: AAA C"s"R

Yes, that is the next sentence: “If your refund is requested within the first 90 days of your Membership year, we will deduct any ERS charges incurred on your behalf”.  Periods are used to end sentences, to convey that the contents of one sentence are complete, and that the next sentence conveys a new idea or expands upon the previous idea.

The relevant sentence, which is the one I am asking you to act upon – because I am NOT in the first 90 days of my membership year (and thus the sentence about the first 90 days does not apply) is “We will provide a pro-rated refund on Membership dues at any time.”  This is an “any time” and I am asking for that pro-rated refund on my membership dues.

Thanks so much for your help!

 

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From: AAA C"s"R

To: Fed-up Customer

Subject: RE: Here is the information you requested

can I get your member number again please

(Note: the obvious time and effort put into punctuation and courtesy, in an attempt to convey the value AAA places on customer service)

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I sent my member number.  No reply.  

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The annoying thing is, that’s 4 different customer “service” reps in a row that didn’t help.  Not one employee stopped and thought “are we doing the right thing for this long-standing customer?  If our policies are not helping our customer, can I find another way to provide the customer with the service which we promised to provide in exchange for the fees we received?”  Not once.  All I wanted was a map.  Mailed to my address, which they have had for 7 months or more.  Instead, I got a demand for more money – which they knew that they would get in ~a month, because I was on auto-renew.

So the last C”s”R was really douche-y, but I can’t blame that one employee.  When it’s four employees in a row, that’s not a bad draw – that’s a bad company.  Note to companies - when you've had a customer for almost 20 years, cancel them politely or they'll never come back.  Don't be a douche about it.  You created the problem and you refused to fix it in a fair and helpful manner; you created the system where my easiest solution was to cancel. 

Anyway...

It got me thinking about why I’ve wasted so much money with AAA.  They’re ultra-expensive as Motor Clubs go (I've been paying ~$150/yr. for a couple).  They don’t cover my RV, so I have RV tow insurance – which is the better bet – and it turns out my RV insurance covers my passenger cars, too.  Damnit, I’ve been renewing AAA out of habit because I might have needed them when I was 22, dumb, poor, and didn't think I could afford towing (yet I never needed a tow, so AAA membership was wasting money I couldn't afford – I did say I was 22 and dumb).

When I’ve needed a tow, I’ve had to wait a loonnnggg time for Triple A; if I’d been a cash customer, I would have had leverage to get a faster response or to choose another tow company if the first one took over an hour to come out.  Maybe I was paying for the convenience of having a single number to call – but my credit cards have services that offer the same convenience.  And a lot of repair shops have relationships with tow companies; the repair shop has the leverage to maintain good service and fair prices.

Here are some alternatives to Triple A:

Do you even need roadside assistance coverage?  

Maybe not.  If your car(s) is (are) newer, the manufacturer may provide free roadside assistance.  If you take good care of your vehicles and rarely leave your keys in the car, run out of gas, or leave your headlights on, you may never need roadside assistance.  I've had AAA for nearly two decades; if I had paid full retail on every single call AAA ever covered, it would have cost me a few hundred dollars, but I've paid AAA more like $2k+.  I almost never use their discounts; there are other programs that offer better discounts.  I justified the membership by the maps - back before GPS, those triptiks were pretty handy.  Not $2k handy, but sometimes we need help rationalizing a waste of money.  Of course, now AAA won't mail me maps under my paid-up, non-cancellable, non-refunded, non-transferable membership, so moot point.

But I think I do need roadside assistance coverage.

Okay, then here's some options:

• Allstate Motor Club starts at $52/yr. up to $108, with no extra charge for your spouse.
• Your car insurance policy probably offers roadside assistance as an optional add-on.  With USAA, it costs ~$1/month per car.  If you get car insurance through Costco for Executive Members, roadside assistance may be included already.
• If you have an RV, your RV roadside assistance might cover your cars, too.  Good Sam does.
• I you're an AARP member, roadside assistance is available for $36 (one person) to $101 (up to 6 family members) per year.   *
• Better World Club bills themselves as an eco-friendly Motor Club and they offer car, RV and even bicycle coverage; from ~$55 to $150/yr. - and they waive the enrollment fee for people switching from AAA
• Visa and MasterCard offer dispatch service.  It's not insurance, but a negotiated program where you pay a flat-rate per service call.  More details on Credit Card Deals. 
• American Express includes roadside assistance with most of their cards at no extra charge.
• Most cell phone carriers offer roadside assistance for a few dollars a month per phone.
• Pepboys offers $50 flat-rate towing to your nearest Pepboys.
• American Motorcyclist Association includes MoTow Roadside coverage (cars AND motorcycles) free with membership on auto-renew (membership costs $49/year)
• eCarCare costs $44-64/year plus $15-20@ to add family members.  Their comparison chart shows Triple A's Plus program having a limit of 100 miles per year, not per incident. ??

I'm going to sign up with AAA anyway

Good luck.  But note that when you add a 2nd user to your membership, the discount is nominal and it does not increase the benefits - i.e., you still get the same number of covered calls, but you share them. Also, you don't actually have to sign up with AAA today to use them if you need them later - that "instant activation of ERS benefits" in AAAs refund policy?  For a fee of ~$45 (in addition to the membership and enrollment fee), you can sign up and "instantly activate" Triple A immediately if you need a tow.  Which suggests that it really only costs them about $45 to get you towed - of course, that's about the same price as calling Mastercard or Visa, and you don't have to pay a separate membership fee.  See "Five Reasons to Cancel Your AAA Membership" from StopBuyingCrap for some thoughts on the instant activation approach - because AAA seems to value NEW members a lot more than existing members.  And be careful to check whether you're getting a NEW membership or renewing an old one.  Costco got slapped with a class action for applying membership payments from the date the old one expired rather than starting on the date a lapsed member signed up, but AAA seems to still be doing this bill-you-for-the-last-three-months approach to payments from lapsed members.

AAA segregates members into different regions that apparently have different policies and prices, and their cookie system shuffles your web session to the club nearest where you logon - which may not be the club you joined.  Make note, since the policies, prices, and terms you see on their site may not be the ones you get.

Here's a post about a AAA member who tried to cancel due to illness making her unable to drive anymore; 2 weeks into her membership period, AAA refused to provide a refund. I don't know if she was in a region that doesn't offer refunds, or if they just ran into the same brick wall I am - even when the policy allows refunds, you have to fight to get it.

Another one on AAA's patchwork of membership policies and inadequate documentation of the policies they hold members to: "I did a little research and could find no disclosure of AAA’s nonrefundable enrollment fee. To be fair, AAA doesn’t have a central site — each chapter runs its own site..."

* If you object to AARP's lobbying, please note that AAA also uses members' funds for lobbying.

** Fun tidbit - I logged onto AAA today to see what I had been paying; the website shows I'm still on auto-renew.  So the saga shall persist, it seems,

Rural residents cling to the old ways

Foreclosure Trouble Spreads to Those Who Bet the Farm (Wall Street Journal): "'We overstepped common sense with regard to debt,' he says. '[My] income was always pretty decent, so you always felt like you could make it up down the line.'"

I've read about lots of urban/suburban homebuyers walking away from their homes, saying it's not their fault, they shouldn't have to repay their loans, even claiming that the buyers who don't pay their loans are somehow "victims." Even the Wall Street Journal's tax columnist recently said of short sales "it doesn't seem fair that you could have a $100,000 tax gain from a sale that leaves you $50,000 in the red with your mortgage lenders".

But when it comes to rural residents and farmers, the victim claims don't seem to be surfacing. Instead, we get crazy statements about personal responsibility, living up to one's agreements, learning from one's mistakes.

But those crazy hicks know something that a lot of us smart city-folk seem to have forgotten: Taking personal responsibility is empowering, and those poor hicks are going to have a better life because of it. I can't control the world economy; I can only control my own earning choices, saving choices, and spending choices. I can't wish liars and crooks out of existence, but I can read my contracts carefully before I sign them. I can't change the fact that I've been laid off, or that my business revenue has hit the skids, but I can learn from it, start building up a "rainy day fund," resolve to never again make a critical, expensive, long-term obligation (like, oh, say, a mortgage?) without giving it a lot of thought and carefully considering whether I can meet that obligation over the long haul, in sickness and in health, through booms and busts and births and deaths.

One of my high school classmates had the world on a platter. She was smart, athletic, pretty, healthy, popular, and she was going to her first choice college. Until winter of her senior year, when her father died without insurance. Her mother had been a stay-at-home mom with no job prospects. Suddenly their entire world was destroyed; the prom dress was returned to pay for groceries, and the family spent graduation week moving out of the house as it went into foreclosure. What is ordinarily a joyous time for a young person - celebrating completion of high school, anticipating the promise of college, envisioning a bright future - became a crash course in the real world. Losing a house is hard - losing a father, a house, a college plan, a mother's confidence, and one's faith in the world, that's a real loss.

In a way, my classmate gave me a glimpse of the future. Her family was upper-middle-class, capable of providing financial security OR "the good life." They chose the larger house, nicer clothes, better vacations, superior summer camps. All good things to have, but all luxuries. Had the parents experienced a bit of a strife earlier on, perhaps they would have taken life insurance or put away a little cash for emergencies. While you cannot absolutely prevent death, layoffs, and other life-altering experiences, you can plan and reduce their impact.

We all feel great compassion for those who die younger than expected. We feel compassion for folks who are laid off. It's a little harder to feel compassion for someone who experiences the shock of: their mortgage payment rising to the level spec'ed out in their mortgage contract. Yet these are all life-changing events, and they are traumatic in inverse proportion to our preparation for them. If we cannot tolerate the mere thought of such things, we can at least build up a cushion of savings, keep good, organized records, find a way to prevent the preventable and take the sting out of the unavoidable.

(Older post that got stuck in my queue and I just discovered it today.)

Foster care for Deployed Soldiers' pets

My Nat'l Guard sister e-mailed me something about soldiers leaving their pets (and the rest of their families) behind when they're sent to war.  Sis has been deployed a number of times, and has some experience with the scramble to make arrangements for kids and pets.

The military does not provide pet care.  So I wondered who does.  For many soldiers, pet and child care is a private arrangement with family and/or friends.  But many folks don't have family (i.e. foster kids, orphans) and/or their family and friends are unable to take in the soldiers' pets.  There are some great non-profits that step in to help out.  Here are some.

General tips about military pet options from the American Humane Society:

http://www.americanhumane.org/animals/adoption-pet-care/issues-information/fostering-military-pets.html 

Foster homes for deployed soldiers' cats:

http://www.operationnoblefoster.org/

MilitaryPetsFOSTER Project

https://www.netpets.org/militarypet/foster.php

Guardian Angels for Soldier's Pet

http://guardianangelsforsoldierspet.org

I have no personal experience with any of these organizations, so they're only listed as a starting point for your own research.

If you're able to offer foster care for a soldier's pet, or looking for a worthy charity, these organizations might be worth looking into.

Megaflation? Inflation and Ultra High Net Worth

We're seeing companies like Groupon selling for billions of dollars.  It now costs $300 Million+ for a really nice yacht.  The 20th anniversary Louboutin shoe runs $4k at Barneys (and it's kind of ugly).  This is a special kind of inflation.  It's not a mere multiplier of the previous value of the dollar, but the value of the dollar to a narrow band of consumers - the ultra-rich.  If you sell commodity chicken breasts - the kind you find in every grocery store - there is a limit to what you can charge.  Too high, and you won't sell enough chicken breasts to pay your electric bill.  But if you're selling ultra-luxury products, it's almost suicidal to sell them at prices the masses can afford - the ultra-rich luxury shopper wants exclusivity, and the only way to get it is to put products beyond the means of the masses.  Dollars inflate in context.  The dollars of the wealthy are a unique context.  By ultra-rich standards, millionaires ARE the masses.

The World Wealth report takes an annual snapshot of the wealthy.  Their 2011 report - as listed on their website - doesn't seem to define their current meaning of the terms High Net Worth Individual (HNWI) and Ultra-HNWI, so I don't know if the minimums have changed, but wikipedia cites the 2007 Wealth Report as defining HNWI as millionaires and Ultra-HWNIs as those with assets greater than $30 Million. "Global HNWI population and wealth growth reached more stable levels in 2010, with the population of HNWIs increasing 8.3% to 10.9 million and HNWI financial wealth growing 9.7% to reach US$42.7 trillion. The global population of Ultra-HNWIs grew by 10.2% in 2010 and its wealth by 11.5%."  Wikipedia cites the 2007 Wealth Report, indicating 3.3 Million HNWIs in North America, and 41,200 Ultra-HNWIs.  That would include the Bill Gates' of the world, whose billionaire status makes the common millionaire a mere slumdog, but American billionaires number in the hundreds, not the 10s of thousands.


MeasuringWorth.Com takes a few different approaches to comparing inflation over time.  Instead of using a mere CPI multiplier, they offer additional approaches, including "Economic Power," or wealth as a share of GDP, intended to convey how many adjusted dollars it would take to have roughly the same influence.  Comparing a WWII millionaire against today's dollars, MW comes up with:  "In 2011, the relative value of $1,000,000 from 1945 ranges from $10,200,000.00 to $67,700,000.00."  The $10.2 Million figure uses a GDP deflator*.  The $67.7 Million figure represents how many current dollars it would take to have about the same level of influence or power.  To enjoy the same economic status or prestige, however, would cost only $30.4 Million 2011 dollars.  Yet the CPI Inflation calculator tells us only that $1 Million 1945 dollars are equal to $12.5 Million 2011 dollars*.  It depends what you're buying.  Chicken breasts are one thing.  Supra-human rights and influence are something else altogether.  George Soros cracked the top 10 on Forbes 400, and I don't think he had to break a nation's currency last year to do it.

So next time your mind boggles at the idea of the Facebook boy being "worth" Billions, take it with a grain of context.  John D. Rockefeller was a billionaire (with a B) in 1916, back when that was real money.  In 2007, the NY Times estimated that Rockefeller's inflation-adjusted net worth would be about $192 Billion.  Interesting, most of the 30 Wealthiest Americans Ever in the NYT article made their money facilitating American production/exports (coal, oil, railroads).  Compare that to the top 30 on Forbes' 400 list today - software, Walmart, hedge funds/investing, casinos, media, retail, candy... I'll grant, software can facilitate production, but most of the rest are either making money by shuffling money around, or selling people crap they don't need instead of selling tools/materials for creating durable goods.  In our modern economy, the money isn't in the steak, it's in the sizzle or in the e-mails and databases tracking the steak or the sponsored ads, newspapers, and magazines selling the steak.

The Forbes 400 starts with Bill Gates @ $59 Billion and ends with a 4-way tie for 397th place @$1.05 Billion.  The ranks of the billionaire club are still pretty durn small.  Their combined net worth is about $1.5 Trillion.


* CPI is especially a joke in the context of the ultra-rich.  In explaining why it makes sense for the CPI to use the price of hamburger when steak price increases would push "inflation" measures up, BLS said: "Thus the index does not reflect the fact that consumers can and do, to some degree, insulate themselves from the impact of higher prices by adjusting their spending to favor relatively lower-priced goods or services. Consequently, the current CPI, when compared with a measure that reflects this substitution effect, tends to overstate the rate of price increase consumers experience." Because I'm sure the ultra-rich totally trade down from Mercedes to Honda and from First Class air to staycations, right?

The thing to remember about CPI is that many government-contract inflation adjustments are pegged to the CPI.  By tweaking the CPI to understate inflation, the government reduces the cost of inflation-targeted obligations like Cost of Living Adjustments.  They have a huge vested interest in underestimating inflation.

Cable TV and Real Estate Frivolity

When I was a child, we had no cable TV and Al Gore hadn't invented the Internet yet.  When I was sick and stayed home from school, the kind of sick where you're too sick for school but not sick enough for hospital, I watched TV.  Being a child, I couldn't follow the thread of soap operas.  Which meant that my sick-day-TV options were 1) nothing, or 2) game shows.  I opted for game shows far too often.  Game shows seem to prefer contestants who look like Midwestern housewives, but act like they are high on ecstasy and speed.  They grasp hosts in bear hugs and smile at the audience and yell at the machines.  It's like Vegas without hookers and desperation.  Children need cable TV so they have an option 3) anything else.

As I try to close on a house, I eagerly await status updates from people like mortgage reps, utility companies, and real estate agents.  At times, I refresh my e-mail many times a day.  On critical days (today is a critical day), I refresh my e-mail every 30 seconds or so.  This results in much time spent watching the e-mail in-box for changes.  The changes don't appear.  In my mind, as I see the Send/Receive Progress box vanish with no new e-mails, I hear the "wah-wah" sound of old game shows.  After several failed draws, I refresh again, ever hopeful, and my mind shouts, "come on! big money! approved! cheap rate buy-down!"  Come on, people, my house awaits!

I will not divulge details of my house hunt-catch just yet; but it is awesome.  If it were a game show prize, it would require two scantily-clad models to flail their arms at its awesomeness.  Maybe 3.  Remember the show with the doors, and the bad prize would sometimes be where they'd open the door and a donkey would walk out?  This house could totally have a donkey walk out a door, and it would still be awesome.  Awesomer.

 

I thought that relocation was going to be awesome:

Then I found out that relo couldn't find temporary housing, scrambled to find a hotel, was stuck in a hotel for months, and discovered that the frequent police visits are not security patrols, but meth-freak-out transporters:

This is me about to close on housing awesomeness:



There are just a few more steps, and then we move in and sleep on the floor, because the movers need 10 days to schedule our delivery (10 days of storage payments, of course).  I have done my part.  Now I must wait for others to do their stuff.  So I refresh my e-mail, in hopes that each will reward me with confirmation that they have done their part.

And I get a new message!  Eureka!  This might be it!

But, no, it's just a status update from LinkedIn.