DISASTER RELIEF: Charitable Giving

I am sitting here in my intact and fully powered home so grateful to have survived Hurricane Sandy with such good fortune.  Sadly, the broadcasts are full of endless devastating images of the aftermath of this natural disaster.  Just a few miles in every direction are people without power, people without food and supplies, people without access to transportation, people whose homes are flooded with a mixture of water and sewage, people whose homes have been looted, and people whose homes have been burnt to the ground.  In an effort to help these people I am reaching out to my small audience and pleading for any contribution you can give.  It can be money, it can be your time, it can even be your blood.  And in the spirit of broke and beautiful I hope to share some important lessons.

Sadly, there are those who seek to profit from the misery and devastation of others.  While I would very much like to reach out on a local level to victims of Hurricane Sandy, donating to an established organization or charity is the best way to avoid frauds and con artists.

Unless you are personally connected and can vet the person raising money, donate to a well run relief organization that is equipped to handle assistance in such extreme situations. With any big organization, there will be administrative costs, but at least you can be certain help is being given. The Red Cross donates 91 cents on the dollar to victim relief.

If you are in the area of devastation, distribution of water, food, and supplies will undoubtedly be appreciated.  Unfortunately sending these supplies to the relief organizations may not be as effective as the charity may not have an infrastructure or staff to receive and transport them.

Lastly, leave a paper trail.  When you give cash, it’s hard to track if something goes wrong.  You will need the receipt for your taxes anyway.  Check the charities’ background with the Better Business Bureau before donating to be sure.

Better Business Bureau (Charities):

http://www.greenville.bbb.org/charity/

The following is a list of organizations/places seeking donations for the victims of Hurricane Sandy.  Please note the many ways you can contribute.

The Red Cross

Donations will provide shelter, food, emotional support and other assistance to those affected by the storm.

Money: www.redcross.org

Mobile: Text the word “Redcross” to 90999 to make a $10 donation.

Blood: Donate blood.  Call 900-933-2566 or visit www.nybloodcenter.org.  Supplies are low in the most affected areas.

The Salvation Army

Donations fund the shelters and feeding units set up along the east coast to serve the most heavily hit areas.

Money: www.salvationarmyusa.org

Feeding America

Distributes emergency food, water, and supplies to victims in the disaster zone.

Money: www.feedingamerica.org or call 800-910-5524

Foodbank NYC

Gathers food donations from the local community and distributes them through affected areas. Local level.

            Food:  www.foodbanknyc.org

            Time: www.foodbanknyc.org

AmeriCares

Provides medicine and supplies to those affected by the hurricane.

           

            Money: www.americares.org

New York Cares

Distributes aid to disaster victims.  Local.

            Time: www.newyorkcares.org

Save the Children

Provides hurricane relief to families and their children

            Money: www.savethechildren.org

Mayor’s Fund

Raising money for NYC hurricane victims on a more local level.

            Money: https://www.nyc.gov/html/fund/html/donate/donate.shtml

Town of Hoboken

The town of Hoboken, NJ is literally underwater and is asking for help distributing supplies to victims of Hurricane Sandy at their town hall.

            Time: http://www.hobokennj.org/2012/10/hurricane-sandy-update-and-call-for-volunteers/

John Jay High School: Brooklyn

Helps disaster victims and collects donations. (Specifically seeking belts and clothing for men and children).  Local.

            Time/Clothing: John Jay High School Park Slope

Breezy Point Queens Relief Fund
One of the most devastated areas of the storm with fire burning down 110 homes.  This local fundraising campaign was recently verified by NBC News.

              Money: https://www.wepay.com/donations/hurricane-sandy-raising-money-for-breezy-point

Habitat for Humanity
Helps victims of natural disaster rebuild their homes.

              Money: Call 1-800- HABITAT (422-4828), press 0 when prompted.

Recovers.org/communities
Find out what relief is needed in the affected areas of Astoria, Red Hook, Staten Island, and the Lower East Side.  Volunteer opportunities and necessary supplies are listed for each community.

             Time/Donations: www.recovers.org/communities

I will continue to update this list as I investigate and vet charities and organizations contributing to Hurricane Sandy relief.  If you know someone who has started a legitimate charity in connection with this disaster, please let me know and I will add it to the list.  Please pass this post along.  Thank you for reading, thank you for your time, and thank you for your donations. 

$$$ DREAMS

As I sit here twiddling my thumbs waiting for the hurricane to come and power to go out I figure I should write a bonus post for the week.  Everything from Broadway to the New York Stock Exchange is closed today so what better excuse to sit and read my blog :)

But really, what a wonderful gift.  A full day at home, not running to work or sitting in traffic or trying to take care of a million errands all over town.  Rather than waiting for the insanity of the holidays to set resolutions and goals, this day of total stillness is a perfect time to reflect on past patterns and reevaluate, setting goals for the future.

I touched on  the importance of goals a bit in last weeks post “Emotions and Money” as well as last months post “What is Your Why”.  Obviously, they’re important- so now that there’s this downtime, I want to go ahead and break down financial goal setting step by step.

1.     Make a list of all your financial goals. Be specific.

-       I want to pay off my credit card debt.

-       I want to create an emergency fund.

-       I want to save for retirement.

-       I want to go back to school.

-       I want to buy health insurance.

-       I want to see more shows.

-       I want to buy new clothes.

-       I want to take dance class.

-       I want to take more vacations.

-       I want my business to support me.

-       I want to buy a new computer.

-       I want to buy a house.

These are just examples, the list can be as long or as short as you want.  But dedicate at least 10 minutes to take inventory of all your financial wants and needs.  And no judgement.  This list is just for you, so allow yourself to indulge in any dream, no matter how big or crazy. 

2.     Break each goal down into specifics.  This will take some time.  You will need to do some research to specify realistic DATES, COSTS, and NEXT STEPS.

Let’s start with hypothetical goal #1.  “I want to pay off my credit card debt.”  This is a big one with broke beauties so I’m going to spend some time breaking it down.

Here’s your new favorite website, www.dinkytown.net.   This is a website that specializes in financial calculations.  You can play with the numbers on anything from auto loans to retirement savings.  But for now let’s focus on credit card debt.

You will need to input the following

-       Current balance. (Let’s say $6,000).

-       Interest  rate on your card.  (Let’s say 14.5%).

-       Pay off goal.  (Let’s say 18 months).

-       Current monthly payment. (Let’s say $200).

-       Additional monthly charges.  (Should be zero).

-       Annual fee. (Should be zero). 

If I set my time frame to 18 months, with the hypothetical numbers above, I will need to increase my credit card payment from $200/month to $373/month.  If the results of your input are unrealistic for you, adjust the numbers in the calculator until you find a plan of action that you feel you can stick with.  That might mean calling up the credit card company and working to negotiate a better interest rate.  It might mean giving yourself a longer time frame to get to a zero balance.  By adding an additional six months to the scenario above, I reduce the monthly payment to $289/month.  Yes, I’m paying more interest in the long run, but it’s better that goals be realistic rather than stress inducing.  If you have a card that charges additional monthly or annual fees, it’s time to stop using that card to make purchases immediately.  Yes, you will need to pay down the remaining balance on the card,  but all future purchases are to be made with cash or a no fee credit card. 

            Other goals will be more simple to break down.  Let’s take another hypothetical goal.  “I want to see more shows.”  Let’s get specific.  “I want to see a Broadway or Off-Broadway show once a month.  This will cost about $50/month.” Done.

            Once you get through your entire list of goals, breaking down dates, costs, and next steps you may be overwhelmed.  Which brings us to step 3.

3.     Prioritize your goals.  If you did your homework in step 2, you should have a pretty good idea of how much it will cost each month for each goal.  Chances are you’re not gonna have nearly enough money to cover it all at once, so you’ll have to prioritize.  The vacation and new clothes may have to wait while you take care of the health insurance and emergency fund.  You can prioritize in one of two ways. 

                                               i.     Simply rank each item on your list in terms of importance.

                                              ii.     Divide your list into categories and rank the items within each category.  It’s probably not realistic to wait to buy new clothes until you’ve accomplished everything of higher priority on the list.  By grouping your goals into categories, for example, Career, Leisure, Education, Financial Security, etc.  You can create a greater sense of balance by tackling the number one priorities in each category then working your way down each list.

Don’t be overwhelmed by the numbers.  If it’s too much to pay off your credit card debt and see a Broadway show every month, focus on one goal before moving onto the next or save a little for each.  You’ve already made a huge step by setting a goal, getting specific, and prioritizing.

“ People shy away from specificity because they’re in love with the idea of dreams staying forever intangible, ethereal “dreams”. Hey, they think, if I can’t put a price tag on my dreams, they can’t be grounded in reality, and therefore I never have to realistically save for them.  On the other hand, once you put a price tag on the thing you desire most, once you reduce it to a monthly cost, you will quickly grasp the amount of sacrifice and commitment that needs to go into it […] Prioritizing your dreams is a powerful process.  It may be that once you know the hard mathematical facts, you’ll realize that some of your lesser goals aren’t really worth the effort.”

-       The Money Book for Freelancers, Part-Timers, and the Self Employed by Joseph D’Agnese and Denise Keirnan (full review to come).

     

I LOVE this passage and I wanted to share it as it relates so perfectly to everything we’ve discussed up to this point.  OK, one last step.

4.     COMMIT!  So here’s the hard part.  Breaking a habit (like smoking) or implementing a lifestyle change (like a diet) are very difficult things to do, and financial changes are no different.  The best thing to do is to create accountability with yourself and with others.  Share your goals, create a support system, and try creating or using an online accountability system like www.stickK.com.

Don’t let your dreams stay dreams forever.  Define them in tangible terms and action steps today.  Once you’ve read through this you won’t even need the power to stay on to get started.  Get out a pen and paper and ride the storm out with some powerful and specific goal setting.

EMOTIONS AND MONEY

“If I had more money, I would…” 

How would you finish that sentence? 

Pay down debt? Retire?  Travel? Buy a home?  Whatever your answer, it’s probably something you’ve envisioned many times.  Now, as you imagine this world with more money, think of how you feel.  Good right?  The anxiety and fear around your personal finances dissipates, you slip into a sensory fantasy of sunshine on your face, mojitos on you lips, sand between your toes, salt water in the air, and ocean spread out in front of you.  Oh so good.

Welcome back to reality.  Did you notice a major change in the way you felt from your “more money” fantasy to the present?  Probably.   While money and personal finance seem logical and mathematical, the external elements of the two are dictated by strong internal processes- emotions.

On one end of the spectrum is what we explored at the start- our dreams, and all the deliciousness they make us feel.  On the other end is fear.  Fear of loss.  Fear of success.  Fear of failure.  Fear of the unknown.  These dreams and fears shape our behavior, and the emotions associated with them directly influence our relationship with money.

So… In order to master our money we must face our fears and set goals to achieve our dreams. 

Go ahead and make a list of all your fears.  Not spiders and snakes, but fears related to money.  For instance, “I fear consumer debt” or “I fear not having enough money to cover my expenses”. 

Then identify what steps you can take to overcome that fear.

“I fear consumer debt” so  “I will cut up my credit cards”.

Or

“I fear consumer debt” so  “I will make all purchases with cash”.

“I fear not having enough to cover my expenses” so  “I will analyze my spending and see where I can cut back.”

Or

“I fear not having enough to cover my expenses” so “I will ask for a raise or find additional sources of income.”

By planning ahead while you’re in a logical frame of mind, you’ll reprogram yourself to feel confident with your cash rather than allowing emotions (like fear) take over.

Allow your newfound cash confidence to pervade your life.  Don’t let feelings of low self esteem lead you to spend cash on things to fill a void or for short term satisfaction. You can’t change your inside by buying things for the outside. Emotional spending can be expensive and destructive, pushing long-term dreams father away. 

Help yourself out by setting financial goals.  Write them down and be specific.  Some should be long term, big picture goals, like the dreams we identified at the start.  Others should be short term.  Look at them every day.  Keep them in your wallet next to your money.  Each time you open your wallet to take out cash or a credit card, your goals will be staring you in the face, reminding you to ask yourself “Is this purchase going to help me get the results I’m aiming for?” “Is this going to make me feel great in a way that improves my well being?”

By setting goals and changing the course of negative spending patterns, emotional spending becomes conscious spending.  And conscious spending is the key to mastering personal finance. 

GRATITUDE

I’ve been admittedly down the last few weeks.  Unemployment and unexpected expenses have made for a pretty bleak autumn thus far.  Wallowing has done nothing for me so I’m changing tactics and working on gratitude.  If you’ve ever read “The Secret” or heard of “The Law of Attraction” you’ve heard that the energies you put out are the ones that you attract.  Well I can definitely attest that wallowing begets more wallowing.  If instead I reflect on the things for which I am grateful, perhaps I’ll receive more to be grateful for.

            This blog is largely focused on a lack of money and ways to avoid unnecessary spending.  While it’s important to have a realistic understanding of where you stand financially, the mindset with which you approach the numbers should be one of appreciation 

for what you have, rather than contempt for what you don’t.  Whatever amount you have in your bank account, it’s an abundance to someone.  Instead of feeling like you’re barely getting by, give thanks that you can pay your rent, your heating bills, your grocery tab.  When you get a paycheck, instead of thinking, “I’m not making enough”, think, “I’m grateful that money is coming into my life and I’m open to receiving more”.  When you see change on the sidewalk, pick it up, enjoy it, and be grateful that money is flowing towards you.  By perpetuating a sense of abundance rather than lack, you’ll attract more prosperity.

            If you have a hard time thinking of your finances as abundant, look at other aspects of your life that are.  Give thanks for friends, family, work, hobbies, anything and everything.  By giving thanks and allowing for all forms of abundance, you’ll also be allowing more money to enter your life.

            Don’t worry; I haven’t gone completely new age on you.  I’m still a hard ass when it comes to needless spending and properly saving (stay tuned for next weeks blog).  But from time to time it’s important to take a moment, stop worrying or wallowing, and give thanks for what you have.    

SEASONAL SPENDING: HALLOWEEN EDITION

It’s that time of year again.

October through December is a three month long annual indulgence.  It starts with the Starbucks pumpkin spice lattes and lingers through the New Years Day hangover.  Columbus Day apple picking, Halloween, Thanksgiving, family reunions, holiday parties, vacation, secret Santa, Christmas, and finally New Years provide excuse after excuse for months of endless eating, partying, and spending.

  

If you’d like to make it to 2013, or even November without depleting your bank account, take a moment to put your seasonal expenditures in perspective.  Let’s just take on October for now.  

According to a new survey released by the National Retail Federation, Americans plan on spending an average of $79.82 on costumes, decorations, and candy this year (up from $72.31 last year).  And it’s the adults (not the kids) who are driving up the average! What?!

If you’re reading this, you’re probably full-grown adult- there is absolutely no reason on earth to be dropping the big bucks on Halloween crap.  This doesn’t mean no fun, no pumpkins, or no parties.  It just means avoiding Ricky’s, Party City, and the seasonal departments of Kmart, Wal-Mart, and Duane Reade till the end of the month.  The good news is, you can raid the stores on November 1^st for cheap candy and, if you must, clearance items for next year.  But dropping $50 to $100 on a costume you’re going to wear once is nonsensical if you’re someone who worries about making monthly rent payments. 

I intend to spend Halloween at home, cooking up some beautiful seasonal squashes and pumpkins from the farmers market and treating myself to home made dessert, hot cocoa, and TBS’ inevitable programming of "Hocus Pocus".  Won’t cost me more than any other Wednesday night.  But if you’re looking for a more rambunctious evening, here are some ideas to help keep your spending under control.

1.     Get creative.  Instead of rushing to the store for costumes and decorations, see what you can make from things you already have at home.  Use pinterest for inspiration. If there’s something you’re missing, consider thrifting first.

2.     Find out if your family members or friends have costumes you can borrow or trade.  GreenHalloween.org is a website that actually specializes in costume swaps. 

3.     If you know you’ll have trick-or-treaters, buy a bulk bag of candy from a discount or dollar store, you know you’ll want the leftovers to hold you over till Thanksgiving anyway.  If you’re afraid you’ll eat all the candy before the day arrives, buy something you don’t like so you won’t be tempted.

4.     If you tend to have an abundance of trick-or-treaters on Halloween, hand the candy out yourself.  One per person.  If they don’t like it, remind them they can trade with friends later.  Remember, there’s a childhood obesity epidemic, no full size candy bars.

5.     Instead of going out and spending at a club or bar, host a Halloween themed game night or an autumn pot luck.

Spending money on Halloween may be the definition of frivolous for adults without children.  While there is no room for frivolity in the broke life there is plenty of room for fun, creativity, imagination, and friendship to make it a beautiful holiday.

Shit Happens.

I went to get a loose crown checked out at the dentist this week.  It quickly turned into a $250 tooth extraction and sheer panic over the $1800 dental implant I would need to replace it.  Shit happens.  And when shit happens, you need to have an emergency fund in place to cover the cost.

An emergency fund is an easily accessible stash of money for “shit that happens”- or emergencies.  It’s NOT for taking a vacation or buying ANOTHER new phone.   It’s the money you live off of when you’ve been laid off unexpectedly, the money you use to fix the leak in your roof, the money for your medical bills when your teeth, your bones, or God forbid your heart give out on you.

The sad reality is that something unexpected and expensive is going to happen.  You are not immune.  So if you’re thinking, “I can’t afford to have an emergency fund”, start thinking, “I can’t afford not to”. It’s been shown that those who don’t have emergency funds are more likely to amass debt.  Start saving now before you find yourself in a hole you can never get out of.

Experts recommend setting aside anywhere from $1,000 to 9 months worth of living expenses for your emergency fund.  The suggestion that I would have an extra 9 months of living expenses just lying around is laughable to me as it probably is to all the broke and beautiful; so let me offer my suggestion.

Open a high yield savings account with an initial deposit of $1,000 to start.  If you don’t have $1,000, make it happen.  Look back at the post “What Do You Have To Offer?” for some ideas.  Now in my opinion $1,000 isn’t going to get you very far in an emergency, so once you’ve made the initial deposit, contribute weekly, bi weekly, or monthly to your emergency fund until you’ve built a nice cushion.

I have about three months of living expenses saved up.  In an ideal world, I’d have six.  After getting my teeth fixed, I’ll probably have one.  Time to prioritize the emergency fund.   I recommend your emergency fund contributions being your top priority after basic needs like housing, food, and transportation until you hit the three to six months of expenses mark.

If you have trouble saving, set up direct deposit to your emergency account.  If you like to spend impulsively, don’t get a card attached to the account.  While your emergency money needs to be accessible (not tied up in a retirement account or risked in investments), you don’t want it to be so readily available that you blow it all on the new iphone with one swipe of a credit card.

Now start saving- and be safe.  Shit will happen, but at least you’ll be prepared.

AFFORDABLE NYC HOUSING

Affordable housing in the New York City Metro Area.  What a contradiction.

The search for a place to live is never easy- regardless of whether you’re looking to buy, rent, or sublet.  But add to that being broke in one of the worlds most expensive cities and you’ve got a serious challenge.

Experts recommend spending about one third of your take home pay on your rent.  Unfortunately, while the city’s median household income has barely moved in the past ten years, the average apartment rent has climbed by 27%.  In July 2012, the average Manhattan apartment rented for $3,461.  That means you’d have to be making over $10,000 A MONTH (over six figures annually) to live there and be “living within your means”. Thirty percent of New Yorkers wind up spending over HALF their income on rent.  Don’t be in that thirty percent!  That’s money out of your savings, your emergency fund, and your retirement- places where you really can’t afford to cut corners.

So, do you sift through the endless crap, scams, and unpredictable roommates on craigslist or spend a fortune on a broker?  Do you splurge on a convenient studio or couchsurf from place to place? 

For the purposes of this post, let’s assume a down payment is nowhere in your immediate future and you’re not applying for subsidized housing (a possible future post).   

So “For Rent”. The rental market typically slows down in the winter months.  To get the most bang for your buck, consider waiting till the holidays.  The move may not be pleasant, but the savings will be worthwhile.

Now, let’s start with priority number one, location, location, location.

If you want to get real about saving money, get real about location.  With the exception of Washington Heights, Harlem, Inwood, and a few other northern extremities, Manhattan is not really in the picture for the broke and beautiful.  That being said, if you MUST stay on the island, look for something noisy or ugly.  A construction site (second avenue subway line anyone?), a tunnel entrance or exit, an above ground subway (excluding the high line)- yes, there are some quality of life considerations here, but if you’re willing to swap an eye sore for a commute, you can save a lot of money by renting in one of these kinds of locations.

Unfortunately, Manhattan is not the only pricey NYC area.  Apartments in Williamsburg and Hoboken give me sticker shock.  Look for the neighborhoods that aren’t incessantly written about in the paper.  Walk away from the street with the trendy restaurants and bookstores.  Even a block or two over can mean a major price difference.     

Once you settle on a neighborhood the easiest way to save money is to avoid a hefty brokers fee.  Look for homes with a “For Rent” sign in the window or for buildings with a rental office on site.   Negotiate directly with the landlord, bypass the middleman, and save the cash. 

The last time I moved I walked through the streets of my desired neighborhoods and wrote down the addresses and numbers for all the buildings with a “For Rent” sign.  Within two weeks I was in a spacious three bedroom for $1600/month!!! Needless to say, I wish I’d never have to move again. 

No luck spotting “For Rent” signs?  Check with the doormen/ front desk associates in some of the bigger buildings. They may be able to provide some insider info or direct you to the buildings’ leasing office.  Also keep an eye out for moving sales, moving trucks, or people dumping their odds and ends on the sidewalk.  Introduce yourself and ask if the landlord has found anyone to take over the lease.  Not only will they be able to give you a first hand account of living in the prospective apartment, but they might just let you take a look around.

The internet is another good place to start your search.  Notice I said “start your search” and not “complete your search”.  While there are so many resources and so much information regarding housing online, there are also so many scams and cons.  Do not wire or send money without ever having seen the apartment or spoken directly to the landlord.  If something sounds too good to be true, it probably is.  Spend some time getting a feel for the market so you can identify when something is a good deal and when something is a too good to be true scam.

The following is a list of websites and resources to help you get a feel for the market and get you started on your search.

Listings/ Classifieds

NY Times

NY Daily News

NY Press

AM New York

NY Post

Village Voice

New York Magazine

Websites/Resources

Craigslist

Pad Mapper

Street Easy

Naked Apartments

Urban Edge

Citirent

NY Habitat

Best of Luck!