One Huge Step: Hair Dye

I have a weakness for dying my hair. I started at my friend’s house in high school, when my very light, very naturally blonde hair just wasn’t suitable for someone trying so desperately to look goth (me).

Hair dye became a habit, and not an inexpensive one. I’ve been dying my hair in some capacity ever since high school, usually at salons.  Every time I’ve tried to save money by dying my hair at home, it hasn’t panned out. My hair is never exactly the right color, or the color doesn’t last as long. I usually end up right back at the salon, paying more money to have my hair look like what I had in mind in the first place, spending more than I would have if I’d just made an appointment in the first place.

I’d probably be tempted to hurl myself from the Golden Gate Bridge if I had a grand tally (financial and chemical body burden wise) of what I’ve paid for the “privilege” of bathing in color-dye chemicals every few months since the age of 15.

So, in December, I decided the time had come to stop dying my hair, once and for all. First, doing so was downright hypocritical. Here I am, reading food labels like a paranoid maniac, buying all-natural-organic everything, making my own food, making my own natural skin care stuff, and… dousing my scalp in chemicals that have been linked to cancer. And paying a damn lot to do it.  Makes perfect sense, no?!

I tried to find salons that used non-toxic or at least less-toxic dyes, and aside from Aveda (which costs a fortune) I couldn’t find many. Two and a half full months went by. And then the new hair and the old dyed hair didn’t look so great together, and I found myself scowling in the mirror every day. I finally lost my patience and, after much of my chemical-paranoia research, bought some EcoColors hair dye in a color that matched my roots (Medium Ash Blonde). And…

I have the best home dye job EVER. I love it more than most salon results I’ve had. As long as I have EcoColors, I’m not paying for a salon dye job again. Yes, it still has *some* chemicals in it, but in trace amounts compared to most salon dyes. My hair is in better shape than ever, much better than it is after salon treatments, and best of all, it didn’t have the usual hair-dye smell. I smelled like lavender essential oil instead. Bliss!

Yes, it costs $17.50 for a home color kit, 2-3 times what drugstore brands cost. But it’s less than the $40-$50 at the local beauty school, much less than $95 at the hipster salon I admit I went to, and much less toxic. I am so, so happy this worked out. Thank you, EcoColors!

No Refinance After All

Argh. A refinance of my 30-year-fixed mortgage is just not in the cards for me right now. The rates did nothing but go up after I applied, so by the time I got approved, they were 6.175% for a 30-year-fixed refi (the rates are much lower if you’re a first-time buyer applying for a brand new mortgage loan, I’ve since learned). That puts my break even point at almost 26 months, which screams “not worth it!” to me. I really have no idea if I’ll own my condo for that long.

I have to learn how to track rates at the level of detail that banks and credit unions can. We hear about interest rates in the news when they drop, but they change on a daily basis and I don’t know how to track that accurately. If nothing else, I’m now approved for a refi in some capacity and will call the credit union as soon as the rates drop, pay an application fee, and lock in a good rate – if it works out that way.

What will you do with your “stimulus” check?

The whole idea that spending one’s hard-earned money is supposedly stimulating is a bit perplexing to me.  Yes, I “get it.”  I know how the world works.  Still.

Salon’s “How the World Works” ran a fun poll on what readers intend to do with their checks.  It’s available here:
http://www.salon.com/tech/htww/?last_story=/tech/htww/2008/02/08/fiscal_stimulus_poll_results/

Like many of Salon’s respondents, I plan to transfer mine straight into the ING emergency fund.   But a girl can dream, for a moment…

I WANT to spend my stimulus check (and tax refund) on:

• A Tempur-Pedic  mattress (the mid-level, $4,400 one).  Dear heaven, my grandparents bought one (with the Tempur-Pedic pillows) and I swear I’d do almost anything to have one of these.  Even they, financially stable that they are, would not lie down on the top-level mattress for fear that they’d lose the will not to spend the $6,000ish required).
• A surfboard (which is just bound to happen at some point, me having some insane urge to swim with all the Great Whites out at Bolinas.

And… that’s pretty much it.  Those are the only things I really truly want.  Well then.  Glad I checked in on that deadening consumer desire.

And you?  What do you want to spend that check on?

We Owe China, Big Time

I occasionally get questions, but more often flak, for not buying things made in China. I’m sometimes accused of racism, anti-globalization sentiments, and so on. This leads to my trying to explain the vicious cycle of American over-spending and debt to China, which I don’t think most Americans truly understand or want to think about. It’s hard to have fun shopping and “getting good bargains” when you pause to think of where your dollars really go. Best not to think about it and instead enjoy how cute you look in that adorable new sweater.

Fortunately, a recent article in the Atlantic does a much better job than I ever have of explaining the intricacies of American over-spending, foreign debt, where our dollars really go, and how the quality of life in China held “artificially low” by the Chinese government. I strongly encourage everyone to read this article. The Atlantic has the full-text article available online for non-subscribers at:

The $1.4 Trillion Question by James Fallows
The Chinese are subsidizing the American way of life. Are we playing them for suckers—or are they playing us?
http://www.theatlantic.com/doc/200801/fallows-chinese-dollars

This snippet that drives the point home: “In effect, every person in the (rich) United States has over the past 10 years or so borrowed about $4,000 from someone in the (poor) People’s Republic of China.”

I think the highlight of the article is the author tracing the purchase of a $30 electric toothbrush at CVS to China, which begins at the top of page 3 with this paragraph:

“Let’s say you buy an Oral-B electric toothbrush for $30 at a CVS in the United States. I choose this example because I’ve seen a factory in China that probably made the toothbrush. Most of that $30 stays in America, with CVS, the distributors, and Oral-B itself. Eventually $3 or so—an average percentage for small consumer goods—makes its way back to southern China.

When the factory originally placed its bid for Oral-B’s business, it stated the price in dollars: X million toothbrushes for Y dollars each. But the Chinese manufacturer can’t use the dollars directly. It needs RMB—to pay the workers their 1,200-RMB ($160) monthly salary, to buy supplies from other factories in China, to pay its taxes. So it takes the dollars to the local commercial bank—let’s say the Shenzhen Development Bank. After showing receipts or waybills to prove that it earned the dollars in genuine trade, not as speculative inflow, the factory trades them for RMB.”

And a few paragraphs later:

“And thus our dollar comes back home. Spent at CVS, passed to Oral-B, paid to the factory in southern China, traded for RMB at the Shenzhen bank, “surrendered” to the PBOC, passed to SAFE for investment, and then bid at auction for Treasury notes, it is ready to be reinjected into the U.S. money supply and spent again—ideally on Chinese-made goods.

At no point did an ordinary Chinese person decide to send so much money to America. In fact, at no point was most of this money at his or her disposal at all. These are in effect enforced savings, which are the result of the two huge and fundamental choices made by the central government.”

And the Chinese people are less and less pleased about this, a development I understand and will follow. Like the aforementioned average Chinese person, I don’t decide to let our government make some of the decisions it does about spending. I vote as I can and contact my representatives, but it doesn’t mean they do what I say. I can, as one person, decide to send less money to China and stop subsidizing this cycle. All of us can. Most of my money, though not the government’s, is at my disposal. We are all in control of our own money, or should be, and most of us trying to get out of debt and save are aiming for control of our money.

So. I don’t buy goods from China because I don’t want to contribute to this cycle. It is simply not fair for Chinese workers to live the way they are, with a lower quality of life than they should have, while we Americans load up on seasonal bedding and more clothing than we can wear in a year and more shoes than we could wear out in five. I deplore entitlement-minded behavior and our country is full of it. Living without credit card debt and within your means, without using any cash “on loan” from anyone aside from yourself and your own earnings, can remove you from this cycle a bit more.

At the end of the day, we’re U.S. citizens whose government might be doing things we don’t agree with, but each of us can contribute LESS to this unsustainable cycle that has to end some day. It’s hard, but it’s going to be harder later. Buying cheaper goods seems to save money, but our being sheltered from the true cost of goods (i.e., the long-term impact of being beholden to China and at great injustice to the regular old Chinese working person) is what’s allowed us to accumulate so many things we don’t need: Cheap goods have only enforced the idea that we can and should have more, rather than less, and we are sinking ourselves into debt both as individuals and as a nation so we can have still more of it.

Values

I’ve got to let this Suze-style rant of incredulity out. This would be a “my two cents” type of post. Technically, this story is none of my business, or yours for that matter, but someone told me about it and I didn’t ask. It contains what I think are some good financial lessons and illustrations of the values that, I’m sad to say, were and perhaps still are normal in the area in which I was raised.

I grew up in Detroit down the street from Joe, Jane, and their two children, Mary and John. Mary is my age, John is my younger brother’s age. We all went to elementary school together and walked to school every day, etc.

My mom is still in touch with Jane, so we’ve heard about how John, Jane’s son, recently lost his house in foreclosure. He, like so many others in Michigan, was unemployed for more than a year. He worked in construction, the housing market tanked, and not a whole lot was getting built anymore. John, his wife, and brand new baby have had to move in with her parents in an extremely rural area, a very long drive from any area with jobs (and Michigan doesn’t have a lot of those anyway right now). My initial response was the usual “What the hell are you doing having a baby NOW?” They’re 26, time is still on their side. But who am I to say, and that baby’s here now.

Still, I felt badly for John… until the following facts came out.

• John’s father co-signed a mortgage that John and his wife couldn’t qualify for on their own. No one involved seemed to think this was a sign that maybe, just maybe, John and his wife couldn’t afford, shouldn’t have, and weren’t ready for a house. Dad co-signed away. Sometimes, when you think you’re helping your kids, you’re not.
• Dad was subsequently surprised when John couldn’t afford to pay the mortgage, so Dad started making payments that ended up totaling $10,000.
• John lost his job. He received unemployment for six months but was out of work for a year. Because John was house poor, throwing everything he could at the mortgage and still not being able to afford it, he had no savings. I mentioned he had a wife and a baby to care for, right?
• When John was unemployed, and able to care for the baby all day, his wife did not so much as look for a job. Great. Real way to be a team. It’s not as if the baby would be without a parent, he would have just been with a different parent while SOMEONE worked. Still, working at all was unacceptable to her.
• They lost the house in foreclosure, finally. There’s a lot of credit card debt; bankruptcy is on the table.
• Fortunately, John finally found some work with health benefits, about a month ago.
• They still can’t afford to live on their own, so they’re living with John’s MIL for free. They are not contributing toward rent because MIL wants them to save money to get back on their feet. This makes sense. In addition, MIL’s house is in a rural area so the gas costs for John’s commute are not inconsequential.
• MIL has offered to watch the baby all day (she’s retired but in perfect health and pretty young, in her mid-50s, totally capable of this task) so her daughter can go to work. No, says the daughter, I don’t want to. In this case, I think her mom needs to say “Then you can NOT WORK in your OWN HOUSE” but I digress. Or she can trot out the “This house is not a democracy” my dad was so fond of.
• But the icing on the cake is that my grandparents, also knowing of this trouble, heard John and his wife need a new car and offered to practically give them one of theirs. I mean, for thousands of dollars less than they would have been able to sell it for, because they’re all right financially and they want to help. This is just how my wonderful grandparents are. They also made up odd jobs for John to do while he was unemployed so they could give him money in a socially acceptable way.
• So what does John say to the offer of the car? Wait for it… “Oh thanks but we’re buying a brand new SUV.”

And this perfectly displays the Michigan mentality I recognize so well from my home town. You may not have a job. You may not have a house and thus no drive way to park a car in. You may have debt up to your ears. You may not be able to afford your own housing, your own savings, or any savings for your child. But dag nabbit, you’ve got a really nice car that guzzles even more of that gas that now costs close to $3 gallon.

This is what it was like on my street on the northeast side of Detroit. Tiny houses, roof needs replacement, house needs a paint job, lawn’s a mess, but damn that’s a nice car in the driveway! I’ve got My Ride.

And no, no one in John’s family still has a job at a Detroit automaker that gets them any kind of discount.

I make $110,000 a year and I could not comfortably afford an SUV payment, insurance, and gas AND my housing and putting what I should be in savings, as well as emergency savings for my periodically laid-off autoworker father. But John can afford it, right? Does it matter?