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Welcome to fifty: My first health scare as a middle-aged man

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Three weeks ago today, I had a major health scare.

Because it was Monday, I was at the family box factory. I had just finished running payroll and had taken paychecks out to the shop. I exited the building and *bam* my chest just sort of seized up.

“Ouch,” I thought. But, being a Roth, my thought process didn't go much farther than that. (We Roths don't like doctors and we tend to deal with injuries for weeks or months or years before having them looked at.)

On the way back to the office, I stopped to talk to my cousin Duane. He was digging in the dirt, prepping a spot for his summer garden. We chatted about blueberries, tomatoes, and greenhouses. We admired the warm spring day. After a few minutes, I realized that my chest still hurt.

“I don't want to alarm you,” I said, “but I'm having chest pains. It's probably nothing. But just in case it is something, I thought you should know.”

I walked back to the office and sat down at my computer. Instead of going back to work, however, I googled heart attacks. I read the list of symptoms. I wasn't experiencing anything except chest pain but still…Every site said the same thing: Don't mess around. If you're having chest pain, have somebody drive you to a doctor.

Duane came in. “Are you feeling okay?” he asked.

“I'm still having chest pains,” I said.

“Do you want me to drive you to the doctor?” he asked.

I debated things in my mind. “It's probably nothing,” I thought. “Or maybe it's a panic attack like twenty years ago.” In 1998, I experienced two similar episodes that turned out to be panic attacks. I was under a lot of stress then. I'm not under a lot of stress now.

“Plus, if I go to the doctor, it could end up costing a fortune. My health insurance sucks,” I thought. “But if it is a heart attack and I don't go in, I could end up dead.”

“Well?” Duane said.

“Tell you what,” I said. “I know I'm not supposed to but I'm going to drive myself to urgent care. If you don't hear from me in fifteen minutes, come find me.” (There's only one logical route from the box factory to the nearest clinic.)

I gathered my stuff, hopped in my pickup, and drove slowly to the clinic. [Read more…]

Spare change: Awesome articles from elsewhere

How advertisers convinced Americans they smelled bad

Is couponing worth it? Can coupons actually HARM your finances?

Five common pitfalls of sudden wealth

Build wealth and happiness by eschewing status symbols (even if they're frugal status symbols)

Ed Sheeran is on track for the #1 concert tour of all time — WITHOUT gouging fans.

George Washington's rules of civility and decent behavior [PDF]

What it's like to be on House Hunters — twice. [I love this piece. "Reality" TV is anything but.]

The ER overcharged me, so I gave them a taste of their own medicine

Work-life balance is a myth. Instead, try to find the pieces of your job that you love.

You need to practice being your future self

Find an archive of all past spare change links on Pinboard.

By the numbers: My spending for March 2019

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March was a mixed month in my financial world. I ended March with a slightly higher net worth (up 0.6%) but my spending was the highest it's been this year: $5989.10. Yet, that spending was mostly mindful. I wasn't frittering away money on silly things.

If I wasn't buying dumb stuff, then where did my money go? A few worthwhile places:

  • I spent $653.31 on the yard and garden. Specifically, Kim and I tore out a big cedar tree in the corner of the yard, then converted that space to a small orchard. I use the word “orchard” loosely here. We planted three fruit trees, four blueberries, four grape vines, and a bunch of strawberries. I hope to write about this more in the near future.
  • I spent $625.72 on health and fitness. In the middle of the month, I had quite a scare. Out of nowhere, I had chest pains, so I visited the local hospital ER. My co-pays and prescriptions are reflected in March's spending — and there's more to come. (We're about to have a l-o-n-g article on the $6800 hospital bill I received in the mail yesterday. That'll happen in April or May.) Meanwhile, Kim had knee surgery at the end of the month. I paid for some of her stuff out of my pocket.
  • I spent $579.36 on gifts in March, which is very very unusual.
  • I paid the $450 annual fee on my Chase Sapphire Reserve credit card. (Yes, I know this seems like a lot. But remember the card comes with a $300 travel credit, which means my effective annual fee is $150. I believe I receive $150 in value from the card's other benefits.)

I don't consider any of that spending frivolous although I recognize that some of it isn't necessary. (Do we need an orchard? Do I need to give gifts?)

That said, I did have some weak spots in my spending. I bought several movies on iTunes. In fact, I spent $72.63 on iTunes in March. I need to be careful lest I return to my former profligate ways. No more looking in the iTunes store! I also spent $230.15 on alcohol during the month (most of which was beer).

How did I do with groceries? As you know, my food spending had grown out of control, which is one of the primary reasons I'm tracking my spending in detail this year. Last year, I spent over $1000 per month in food. This year, I'm spending less than $700 per month.

I was very proud of my food spending for most of March. I spent a total of $658.21 during the month: $468.27 on groceries and $184.24 on dining out. That's my lowest monthly food total in two years (excepting months during which I've been on the road).

Going into the last week of March, I'd only spent $241.87 on groceries. That's amazing! Things fell apart, however, when I stocked up on food for Kim's convalescence. Meanwhile, we only had three restaurant meals during the month. For one of those, I paid for two guests. Not bad. Not bad.

Quarterly Spending

Now that we've made it through the first three months of 2019, I was curious how my quarterly spending compared to last year. Monthly spending can fluctuate quite a bit. You can get a better idea of your actual habits by looking at a bigger picture.

Here are some highlights:

  • I spent $116.56 at the iTunes store during the first quarter of 2019. That's less than I spent on movies and TV shows during any single month last year, so that's a win.
  • I spent $2076.54 on food for the quarter, which is lower than any quarter in 2018. I spent $1179.53 on groceries, $323.52 on HelloFresh, and $542.29 on dining out. That restaurant spending is another big win. The grocery spending was good — better than any quarter in 2018 — but I feel like I can do better.
  • I spent a lot on health and fitness during the first three months of the year: $1752.60. And the thing is, it's not going to get much better.
  • This year, I decided to separate hot tub expenses into its own category. I spent $151.88 on hot tub stuff (chemicals, etc.) during the first three months of the year. And, no, that doesn't include electricity.
  • Our zoo — three cats and a dog — cost us $447.54 during the first quarter of 2019.
  • You know where I could save big bucks? By drinking less. I spent $586.36 on alcohol during the first three months of the year (and that includes four weeks during which I didn't drink a drop!). That's $6.44 per day. Time for me to cut back on my craft beer obsession…

I spent a total of $15,364.85 during the first quarter of 2019, an average of $5121.62 per month. That's not a great number, to be honest. It's pretty much what I was spending last year. Still, I'm trying not to get too stressed about things…yet.

The whole point of this exercise is for me to figure out where I'm spending my money and why. Once I have a clear picture, I can make some course corrections.

April Is the Cruelest Month

Unfortunately, April is going to have some crazy, crazy spending numbers. My accountant called yesterday to give me my tax bill. I owe $20,000. (I'm not joking.) The hospital called too. They wanted to let me know that I owe them $6800 for the ER visit in the middle of March. To cap things off, payment is due on the vacation that Kim and I booked a year ago. We'll be headed to Greece and Italy in August — but we're paying for it today.

Fortunately, I knew that some of these expenses were looming, so I have cash set aside to pay for taxes and our trip. (The ER visit was a surprise, obviously, and I don't have money set aside for that.) That doesn't change the fact that April's expenses are going to be insane, though. It just means I'm somewhat prepared for the insanity.

The upside to having a $6800 hospital bill so early in the year? It gives me a chance to make maximum use of my health insurance! My max “out of pocket” is $7900 annually. Since it looks like I'm going to hit that, it makes sense to address all medical issues that are bugging me in 2019.

At the end of 2018, I had a net worth of $1,334,227.20. At the end of March, my net worth was $1,397,545.18. That's a leap of more than $63,000 (or 4.75%). That's great! In reality, this simply reflects a hot stock market. My investment accounts are up $77,933.04 this year (11.45%).

A hot stock market can cover a multitude of sins…

Financial advice from my father (when I was nineteen)

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Dad at work in his shop“Who was there for your father when he died?” Kim asked me a few moments ago. She's interested in becoming a death doula, so she's reading a book about end-of-life care.

“It's odd you should ask that today,” I said after I told her the story of my father's six-year battle with cancer.

“Why?” she asked.

“Today is the equivalent day in my life as the day when Dad died in his,” I said. “It's ten days until I turn fifty. Dad died ten days before his fiftieth birthday. So, it's a somber day for me. I'll be thinking of him all day.”

Actually, I've been thinking of Dad all week.

It started when I published Naomi Veak's story about how she learned to stop feeling hopeless about money. In that article, Veak shared a letter her mother sent her when she was nineteen years old. Veak was a poor kid at a rich school, and she was struggling to figure out finances. Her mother offered some words of wisdom.

I had the exact same thing happen to me at the exact same age at the exact same college. I was a poor boy at this rich school. During my sophomore year at Willamette University, when I was nineteen, my father wrote me a letter filled with financial advice.

Today seems like a good day to share it with you folks. [Read more…]

By the numbers: My spending for February 2019

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One of my goals in 2019 is to get back to basics. I feel like I've succumbed to lifestyle inflation, so I'm taking the time to track my money in detail (using my fave tool: Quicken 2007 for Mac) in an attempt to identify problem areas. When I find money leaks, I need to decide whether to eliminate them or accept them.

While I'm skeptical that sharing my monthly spending report has any real value — and it invites unnecessary judgment (I'm already judging myself!) — popular opinion from GRS readers seems to be: Do it!

You folks like looking at my struggles with money haha.

So, here's a quick look at how I spent my money in February — the good, the bad, and the ugly.

February Spending Report

In January, I spent $4819.27 to support my lifestyle. In February, I spent $4556.49, a decline of $250.

That's great! But it still misses my target: $4000 per month. While this is an arbitrary goal, I think it's a good one. I feel like that's a sustainable level for the future. (If my income from Get Rich Slowly and other sources increases, then I can consider boosting my target spending.)

Here's a quick run-down of how I spent on certain key categories:

  • I spent $726.00 on food in February, up $24.99 from January. Of this, $146.41 was spent on dining out, which is extremely low for me. I spent $373.31 on groceries and $189.75 on HelloFresh. (For more info, see my recent write-up of two months with HelloFresh.) In 2018, I averaged $1038.03 per month on food (and spent $1104.97 in February of last year), so I'm happy with the decline so far in 2019. I'd like to see this drop even more, though.
  • Pet spending dropped from $186.63 in January to $112.14 in February. That still seems like a lot. As a point of comparison, I pulled up the numbers from last year. In 2018, I spent an average of $121.40 per month to support our one dog and three cats. Apparently, that's just how much it costs to feed and care for our beasts. (And they're certain they could eat more than we currently feed them.)
  • In January, I spent $326.08 on sin, a category I use to track how much I spend on alcohol, tobacco, and marijuana. (Pot is legal in Oregon. I don't often use it recreationally, but I use it nearly every night to help me sleep. A couple of times per year, I buy cigars and/or clove cigarettes.) In February, my spending on sin dropped to $117.15. This is primarily because I went four weeks without touching a drop off alcohol. And since I resumed drinking, I've been much more moderate in my consumption.
  • As I mentioned at the end of the year, the iTunes store is a dangerous spot for me. I have a tendency to browse and buy a lot of movies. In January, I spent only $3.99 on the iTunes store. Last month, I spent only $39.94. That two-month total of $43.93 is far below the $356.33 I spent at iTunes during the first two months of 2018. Progress!
  • In January, I had $1034.40 of one-time expenses. At the time, I worried that every month would have one-time expenses. That's still a worry. In February, I spent $376.80 to replace the bald tires on my new 1993 Toyota pickup. I also spent $1340 to renew our subscription to Broadway Across America (two tickets for seven shows throughout the year).

Despite spending $4556.49 in February, my net worth increased by $24,276.77 (or 1.78%) — and that's after a 2.29% increase in January. My net worth has grown $54,894.68 (or 4.11%) during the first two months of 2019.

I wish I could say my increase in wealth has come because I'm so damn smart, but that's just not the case. All credit goes to gains in the stock market. If we enter a rocky patch — or worse, a recession — my net worth is going to fall fast. When that happens, I want to be ready to cut spending, if necessary.

Final Thoughts

After two months of updating Quicken daily, I'm noticing some patterns. For example, my spending falls into four broad categories.

  • Fixed expenses (such as pets, insurance, and utilities) come to roughly $1100 per month.
  • Variable spending on necessities (such as food, haircuts, and home + car repairs) comes to about $1200 per month.
  • Variable spending on luxuries (such as books, sin, and the hot tub) comes to about $700 per month.
  • One-time expenses (new pickup, theater tickets, and the like) are totaling about $1500 per month.

I consider roughly half of my spending to be necessary; the other half is (mostly) indulgent.

The fixed expenses are obligations. They're not going away and they're unlikely to change. Variable spending on necessities can be altered, although there's going to be a floor for each expense. (You've been watching in real-time as I toy with my food spending, for instance.)

Variable spending on luxuries is by definition an indulgence. I could absolutely cut these costs, if needed. And, in fact, I have my eye on some of these. Finally, the one-time expenses are a mixed bag. Some, like the 1993 Toyota pickup, are necessities (or close to necessities). Others, like the theater tickets, are absolute luxuries.

I suspect that I'll want to re-evaluate some of my one-time expenses by the time the year is over. Some are more like annual expenses than “one-time” expenses, and I'd probably profit from determining which to continue…and which to cancel.

Kim and I enjoy our theater excursions and our Portland Timbers season tickets, but if we truly want to cut costs, some of these indulgences may have to go. We'll see. For now, I'm content tracking them and flagging them for future discussion.

Case study: Deep in debt but scared to take action

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Last night, as I do from time to time, I met with a GRS reader. Actually, Debbie doesn't read this site but her sister does. And Debbie means to. Although I met Debbie's sister last year at a Camp FI event, I'd never met Debbie before.

“So, what's your situation?” I asked after our waiter had brought us each a glass of wine. “What do you want to know about money?”

“Everything,” Debbie said, laughing. “I feel like I don't know much at all right now. I guess deep down, I know what I need to do. I just don't do it.”

I nodded. “I'm like that with fitness,” I said. “I know what I need to do, but I just don't do it. I know I need to exercise. I know I need to stretch. I know I need to eat better food. But for a lot of people — people like you and me — there's a barrier between knowledge and action. It doesn't matter if we know how to do the right thing. It's the action that matters.”

“I buy books about money but I never read them,” Debbie said. “I have Dave Ramsey and The Millionaire Next Door.”

“Those are both good books,” I said. Then, I shifted gears.

Looking for Purpose

“This might seem odd, but let's talk about your goals. What do you want out of life? What are your big plans?” Our waiter brought Debbie a bowl of mussels and me a plate of pasta.

“I want to make the world a better place,” Debbie said. “I'm young. I work for a huge multi-national company. But I don't believe in the company and I don't believe in my work. I get paid $20 an hour to bring people coffee and water all day. I have a bartending gig on weekends. I want to do something that matters. Maybe improve our food system, for instance. I hate how people eat. I want more people to have better access to high-quality food.”

“That sounds like a noble goal,” I said. “How do you get there from where you are now?”

“I don't know,” Debbie said. “It seems impossible. I have $80,000 in student loans but they're in deferral. I don't have to pay anything on them, but they still accumulate $600 in interest every month. How can I ever hope to catch up?”

“Yeah, that's rough,” I said. “I used to be in a similar position. Twenty years ago, I had over $35,000 in credit card and consumer debt. That's not the same as your $80,000, but it'd probably be equivalent to about $50,000 today. I carried that debt for a long time, just treading water, never getting ahead. I felt like I'd never get it paid off.”

“But you did it?”

“I did,” I said. “I did it by creating a gap between my earning and spending. Fundamentally, there are only two things you can do to improve your situation. You can make more money or you can spend less. Ideally, you'd do both. You want as wide a gap as possible between what you earn and what you spend. Right now, it sounds as if you don't have a gap. You have a deficit.”

Debbie nodded. I slurped down some noodles.

Two Familiar Foes

“How much is your rent?” I asked.

She looked sheepish. “I pay $1200 for an apartment in northeast Portland,” she said. She gave an address near where I lived after my divorce. “I know I should have roommates but I don't. I don't want the complications.”

“And what's your take-home pay?”

“Just over $2000 per month,” Debbie said.

“Yeah, your rent is pretty high,” I said. “I mean, it's not high compared to other places in Portland — it seems about average — but it's high compared to your income. Nearly 60% of what you earn is going to housing. That's a lot! The average American spends about one-third of their take-home pay on housing. So, that's a great place to try to cut costs. Maybe not right now, but over the long term.”

“I like where I live,” Debbie said, prying open a mussel.

“You might want to consider roommates,” I said. “Aside from your housing costs, it doesn't sound like the rest of your spending is outrageous. Honestly, if I were you, I'd try to find ways to boost your income. Especially since you hate your job.”

“I know,” Debbie said. “I've thought about that. I have a marketing degree that I'm not using. My current company offered to give me a raise and a promotion, but I turned it down. I would have been doing work that I hate even more. It would be difficult for me to be in a position where I had to represent a company I don't like.”

“Why don't you quit?” I asked.

“I did once,” she said. “But then I went back right away. I was scared to apply for new work. I don't have much self-confidence. I mean, I'm 31 and have a marketing degree, but I don't have any experience. Who would hire me?”

“I get the lack of self-confidence,” I said. “I totally get it. I struggle with that every day.”

“You do?” Debbie said. She seemed surprised.

“Yes,” I said. “Every day. Even today, I've been dragging around with my head full of negative self-talk. But here's the thing: I've learned to just do the stuff that scares me anyhow.” [Read more…]

By the numbers: My spending for January 2019

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You know how sometimes you let chores and errands and obligations pile up until there's nothing left but to ignore what you want to do and take time to actually do what needs to be done? Yeah, well that's what the past week has been like for me.

I've spent most of my waking hours cleaning and repairing the house, driving around Portland to take care of troublesome tasks, and calling companies (and government agencies) to close accounts and/or clarify questions. This includes six hours I devoted to replacing the kitchen faucet. Ugh.

J.D. vs. the Kitchen Sink

All this is to say: I haven't had time to work much on Get Rich Slowly during the past seven days.

That said, I have been diligently tracking my expenses. As I mentioned at the start of the year, one of my goals in 2019 is to get back to basics. I'd grown complacent over the past few years. I'd succumbed to lifestyle inflation. I want to cut back on expenditures large and small this year to bring my budget more into balance.

Let's see how I did.

January Spending Report

This month, more so than normal, I was eager to analyze my spending. I spent half an hour clicking through Quicken to see if/how my habits have changed since the first of the year. Here's what I found:

  • I spent $701.01 on food in January. Of this, $211.63 was spent on dining out, $346.63 was spent on groceries, and $137.77 was spent on HelloFresh. (The final $8.98 was spent on junk food. I track how much I spend on buying crap at gas stations and convenience stores.) Last year, I averaged $1038.03 per month on food, so this is a delicious decline of 32.5% from that level. Nooice! My hope is that I can cut this even more. Even with the drop, this is way way high.
  • I spent a lot on health and fitness in January. Much of this was spent to purchase a new indoor bike trainer — a stand on which I can place my road bike so that I can ride it in the house. I also bought a new yoga mat, etc.
  • The pets cost us $186.63 in January. Hmmm. I didn't know they were this expensive. Seriously, I haven't been paying attention to how much our zoo costs us. What really surprises me is that our three cats cost more than the dog!
  • I spent $326.08 on “sin” spending in January. That's way too much. I track how much I spend on alcohol and marijuana. (Pot is legal in Oregon, remember. I don't often use it recreationally but I do use it for sleep almost every night.) As I'll probably write about in the near future, my alcohol spending should decrease sharply in coming months. I've decided that I have a problem and I want to change when and how I drink.
  • I only spent $3.99 at the iTunes store in January! This is a huge win for me. I spent less than Kim did at iTunes this month, which is crazy talk. I spent far less than the $204.85 I paid in December. How did I do this? Simple. I didn't let myself browse the new releases. (That said, when I opened iTunes the other day, I did notice that a movie I've been wanting for a long time — Willow — is now available. It took some strength to resist that. I put it on my Wish List in hopes that I'll see it on sale sometime.)
  • I pumped $5141.33 into Get Rich Slowly to make up for a cash-flow crunch. We switched primary ad sources in November, and there's a gap while we wait to get in the new vendor's payment system. (Money came in last week. Yay!)
  • My home value continues to decline. Zillow now says our place is worth $422,000. Nineteen months ago, we paid $442,000. Since then, we've put in about $100,000 of necessary repairs — plus another $50,000 in upgrades. In other words, our home is worth $170,000 less than we've spent on it. This whole situation remains a sore spot with me. But, as many readers have noted, because Kim and I love this place and have no plans to move, it's a sore spot that doesn't really matter. (And I'll bet some of you would be happy if I stopped bringing this up.)

If we ignore the Get Rich Slowly cash infusion, I still spent $4819.27 last month. That's about $1000 more than I wanted to spend.

Looking through my list of expenses line by line, I actually see $1034.40 of one-time expenses. So, in theory, next month my spending should be under $4000. In theory. The problem is that I suspect other one-time expenses will arise. I have this sneaking suspicion that I'm constantly rationalizing “one-time” purchases…as if there should be a $1000/month line-item just for “one-time” expenses. I hope not. But I suspect it's true.

Final Thoughts

Last month, my net worth increased by $30,617.91 (or 2.29%). That's amazing! This was all because the stock market was on a tear, though. The gains aren't due to any acumen on my part.

My goal for the first quarter of 2019 is to become more mindful about my spending. Sure, I want to slash what I can, but my main aim is to be aware of where my money goes, to track it diligently so that I can make appropriate changes going forward.

I doubt I'll post a spending update every month — I'm not sure there's much value in these for anyone other than myself — but I'll publish a few throughout the year. If all goes according to plan, by the end of December I'll have broken some bad habits and built some better ones!

My 2018 year in review

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Across the web, I see other financial bloggers sharing their year-end financial summaries. Some folks had good years. Financial Samurai's net worth increased by 6.5% in 2018. Others had mediocre years. Fritz at The Retirement Manifesto saw his net worth decline by 2.1% thanks to a volatile stock market.

Me? Well, I'm embarrassed to share how my year went financially. It sucked. No, seriously. It was terrible.

My net worth declined by 15.2% in 2018 — nearly $250,000!

Here's a graph of the monthly changes to my net worth during the past two years:

My monthly net worth over time

What happened? Did I buy a Lamborghini? Did I spend a ton during my recent three-week trip to Europe? Have Kim and I been binging on cocaine and chocolate? Nope. While there's no doubt that my habits contributed to my loss of wealth, there are larger forces at play here.

Let's take a closer look. [Read more…]

Case study: Starting with less than zero

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I am not a trained financial expert. I'm not an accountant, I'm not a financial planner, and I'm not a stock broker. What's more, I've made many many money mistakes on my own financial journey. As a result, I've always been reluctant to sit down with people and go over their budgets.

That seems to be changing.

In March, I spent a couple of hours talking with a friend about her financial situation. A few days ago, another friend asked if I'd be willing to meet with him in the near future to puzzle through his budget woes. And yesterday, I took three hours to chat about money with my friends Wally and Jodie.

As always, I've changed names and certain identifying features in the story that follows. Unless I have explicit permission to share details, I do my best to protect people's privacy when I write about their intimate financial lives.

Wally and Jodie have recently begun dating. He's in his early forties (and recently divorced); she's in her late twenties. They both work in food service, and have done so all of their lives.

Their trouble — and the reason they asked me for help — is that they cannot seem to make ends meet. They work hard but never have anything to show for it. In fact, they feel like they're falling further and further behind.

“Can you help us?” Wally and Jodie asked.

“I can try,” I said. “Let's look at your numbers.” [Read more…]

How one young couple budgets and plans for the future

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This month's theme at Get Rich Slowly is relationships. All month long, we're focusing on how money affects our interactions with family and friends — and how family and friends affect our interactions with money.

A couple of months ago, I shared a series of career interviews that the Khan Academy has been producing on an ongoing basis. Each interview consists of three or four separate videos exploring what it's like for different people from different fields to manage their households.

Last week, the Khan academy published a joint interview with a married couple: Julia (a registered nurse) and Michael (a construction business owner). They interviewed each partner separately, then brought them together to talk about how they budget and plan for the future.

When Julia and Michael got together, Julia was the sole breadwinner for the family. Michael was still going to school and he was trying to start his construction firm. When they learned Julia was pregnant, they shifted gears. Julia went on maternity leave and Michael found a job at an auction house. They've been living on one income their entire marriage, but that will soon change as Julia gradually re-enters the workforce.

Julia and Michael used to live in Boulder, Colorado, but city life didn't agree with them. Plus, costs were too high. They chose to move in with Julia's parents in the country, which gave them a lifestyle they preferred and allowed them to save money.

In the interview, Julia and Michael break down their income and expenses. (Their largest expense — by far — is $600 per month for transportation!) They also describe why they've made certain decisions

“We wish we knew how expensive life was. Having a kid is very expensive,” Julia says. “Rent is expensive. When we didn't live on the farm, it was unaffordable for us. One of the most important things we've learned is to invest in yourself. It's okay to invest in your education because that's improving you down the road, improving your financial outlook.”

If you want to see more from this couple, here's Julia talking about what she does (and how much she makes) as a registered nurse and here's how she got her job (and what she plans to do in the future). Here's Michael discussing what his job is like and how he got his job.

As I said in December, I think this library of videos is an excellent resource, especially for kids who might be trying to decide which career to pursue.

College Grads: How to Increase Your Salary

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My oldest son recently asked: “What can I do to make sure I get a big, fat salary when I graduate?” He's a sophomore eyeing chemistry as his career.

Having spent his summer working nearly 60 hours a week in a warehouse, I think he's suddenly come to realize the full-court advantage of a college education.

So I took his question to the mat. How can a student leverage college experience in order to maximize his or her salary after graduation?

After talking with other parents, friends in human resources and school counselors, I came up with seven suggestions.

How to increase your future salary

1. Recognize the value of education

The more education you receive, the better your chances for a higher starting salary. Here are the 2014 median earnings of young adults aged 25-34, according to the National Center for Education Statistics:

  • $25,000 with no high school diploma
  • $30,000 with a high school diploma
  • $49,900 with a bachelor's degree
  • $59,100 with a master's degree

2. Choice of degree and college

When you talk to many high schoolers, it becomes clear that one of the top career choices is engineering. They also want to matriculate at an elite school or a top engineering school. Many parents have the same goal in mind, but does it really matter?

It does. Both in degree and school choice.

The 2015-2016 College Salary Report ranks over 1,000 public and private schools by their salary and degree potential. Cards on the table, I wish we had known about this as we were picking colleges. (The good news is that we have one left in high school who will benefit.)

3. Don't underestimate the power of professors

Professors stay in contact with generations of students, many of whom rise to management positions. There, they often have control over department purse strings, head counts and a certain sway with recruiters and talent resource officers.

If you develop a solid relationship with a certain professor, you can benefit from their knowledge and ability to network with well-connected alumni. This can make quite a difference in how vested your future employer feels in you and your story, which could potentially translate into an opportunity to impact your salary.

4. Internships while in college

The depth of your knowledge and industry experience can help strengthen your resume and possibly lead to a bump in starting salary when compared to fellow students with little or no experience. Term and summer internships can help you demonstrate your value to a potential employer.

Basically, your goal is to have a job lined up and waiting for you as you walk across that stage, diploma in hand, and finally leave college. But again, it's the internship experience and more professional resume which can result in a higher starting salary. Internships without salaries are very common, so take those opportunities to make less as a student and more as a graduate.

5. Negotiate your offer

Often, new graduates are afraid to ask for more when presented with an offer of employment. They are nervous, excited and don't know how the “game” is played with a prospective employer.

If you have more than one job offer, it's a little easier to leverage them to land your dream job at a higher salary. But if the salary is non-negotiable, you could still ask for a signing bonus, a monthly transit pass (where applicable), and additional personal time off/vacation. If an employer wants you bad enough, (s)he might throw some perks your way. But you have to ask for that.

Here's another tip for any job seeker: Go in knowing your full worth. It's common for an employer to ask what you made at your last job or what your salary expectations are. The big secret is that it doesn't matter at all! You should be judged on your qualifications, work ethic and credentials — not on your last salary or what you think you might be worth. Get to know the salary standards for your industry and go in with a confident attitude.

6. Get something published

Write something and get it published in a trade journal. Assist a professor on a technical paper that (s)he plans on submitting for peer review. Having a paper trail and building a case for or against something in your future profession can help get you noticed and perhaps highly sought after. You can turn that notoriety into cash on signing day. Athletes do it. You can too.

7. Network

Don't wile away the time in high school. Start networking now. And in college, keep networking. This is a good time to find out what your friends' parents do. Network with those parents, especially the ones in the same field you are pursuing. But even if they aren't, they might have friends, former classmates or relatives who are in that profession which can provide valuable leads.

Great networking opportunities include LinkedIn, industry association events, local business groups and fundraisers for community causes. Let's take an example. A graduate who lives in Chicago, majoring in communications might meet potential employers by joining a few of the public relations and marketing groups on LinkedIn, attending a Public Relations Society of America luncheon, getting involved with the entrepreneurial center at a local community college and lending a hand at a nonprofit where they can meet business supporters, board members and community influencers.

So skip a few frat and sorority parties and spend some time making a case for why you should be hired upon graduation and why you should receive a higher salary than some of your peers.

I'm proud that my son has the foresight to ask what he can do to improve his standing upon graduating from college. Now it's up to him to act so he can get the big, fat salary he wants.