A few months ago I read an interesting analogy in the book Talent is Overrated, by Geoff Colvin.
The average runner, says the author, thinks about anything besides than the painful fact that hes running. Elite runners, by contrast, focus on every ...
Continue reading A Day in the Life of a Low Performer
Is a University Degree Really Necessary Today?
Possession of a university degree is considered to be important by many employers. The question that we should consider is whether having a degree is the only door to a successful future.
Forty-one percent of university students drop out before ...
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How to Manage Bills and Save for a New Home When Your Income Is Spotty
Some of the most important things in life are always taken for granted. After all, most of us drawing a steady salary never consider how fortunate we are to get a regular monthly or semi-monthly paycheck. On the other hand, those who work on ...
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Why Service Industry, Banking, and Government Jobs Don’t Create Wealth
The high living standard that people enjoy in America -- and the rest of the world, for that matter -- is a result of the hard-earned work performed by our forefathers; most of them spent a lifetime of blood, sweat and tears, creating the wealth that ...
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7 Ways to Immunize Yourself from the Layoff Bug
Very few of us are immune from the specter of receiving a pink slip. In fact, I know of one married couple who both got laid off on the same day.
I've seen lots of advice on the web centered around the theme "You're laid off, now what?" But that ...
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Why Financial Success Often Depends on the Road Not Taken
Decisions, decisions. Like it or not, our lives are defined by them.
It's no secret that a big part of our financial success is based upon the decisions we make in life.
Just ask any person who has jeopardized their financial future by, say, ...
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Quit Sniveling: How to Make Lots of Money Doing What You Hate
Readers: Nobody has written more guest articles for my blog than my good friend, the inimitable Mr. Credit Card. Today Mr. CC is going to entertain us with another of his always thought-provoking ideas. By the way, Mr. Credit Card has just updated his business charge card recommendations for 2011, so please be sure to check them out if you're looking for one.
by Mr. Credit Card
Those of you who follow my Ask Mr. Credit Card blog know that I was recently on travel, visiting California. One of the highlights of my trip was being kingly invited to Len's place for a nice burger grill.
I always buy a new book before I fly to the West Coast and, on this particular trip, I bought Andre Agassi's autobiography. It was a most fascinating read for me because he told the story of his childhood and how he became a top tennis player.
The real shocker though was at the beginning of the book, when he claimed he actually hated tennis. What?! I could not believe it when I read those words!
It turns out that Andre's father was a tennis nut, and he was determined to train his young son to be the world's number one player.
Andre describes his training when he was seven years old. His father created a tennis machine that would hit a ball close to Andre's feet. During endless hours of practice his dad would constantly stand behind him and yell at him. "Hit the ball early," and "harder" were common phrases. I guess it should be no surprise that Andre ended up becoming one of the best hitters of the ball on the rise -- and a pretty hard hitter too.
When Andre was fourteen, his father decided to send him -- against Andre's will -- to the Nick Bolletieri tennis school in Florida. At first the plan was to go for only three months. Then, the folks at the school determined that he was the best talent they had ever seen, and three months eventually became "forever."
Andre was so good that he was able to negotiate a deal that allowed him to skip school. He eventually turned professional before he was twenty. He also went on to become one of the best tennis players of all time, and one of only a few players to ever win all four grand slam titles.
As a professional, Andre was never satisfied if he lost. He maintained a coach. He even hired a fitness trainer who imposed a ruthless fitness regimen that he faithfully stuck to throughout his long career, training for many hours every day.
How to Excel at a Job You Hate
So why I am telling you all of this? Though extreme, I think Andre's story is a clear example that you can excel at something even though you do not like it, assuming you are willing to put in the effort to be good at it.
And even though Andre did not like tennis, he still put in hours of work to be good at his chosen profession. Andre not only earned lots of prize money, but also in endorsement deals with Nike and American Express.
I can think of numerous people I know who dislike their jobs and yet stick to it and earn great financial rewards. I know many folks who work for investment banks and disliked their jobs, but they stuck with it and became good at it because it paid well. I guess there was some motivation there.
You may say that I'm using examples where the financial payoffs are great for those who rise to the top, but I would counter by saying that there are great rewards in any profession when you rise to the top.
And here is the thing that sometimes gets to me: I read lots of blogs (especially lifestyle blogs) and, to me, there are too many instances where you read about folks being "unhappy" with their jobs; everybody wants to make "passive income" and work only a few hours a week. While that is a worthy aim, I think before one starts to focus their attention to entrepreneurship, one should try to focus on being the best they can be in their jobs.
Figure out what it takes to succeed in your industry and profession. You may find that it will bring great financial rewards and you may be happier as a result. And trying to be the best you can be is a trait that is necessary if you ever want to be successful at your own business.
The Bottom Line
Len is always talking about sound money principals. Spend less than you earn, yes! Save, yes! But another important part of the equation is increasing your income. Making more money is a very important part of our personal finances but, too often, the "making more money" part tends to focus on ways to acquire passive income or, even worse, making money by blogging or via network marketing.
I urge you to refocus your attention on your present occupation (whether you like it or not) because I suspect we all can put a little more effort in getting ahead in what we currently do, and reap the resulting financial rewards. Even if we don't like what we're doing.
Editor's Note: Mr. Credit Card told me those were the best burgers and hot dogs he had ever eaten! Okay, not really. But he did have multiple helpings.
Photo Credit: loneymops ...
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How Being Absentminded Resulted In A $2750 Year-End Windfall
At least I'm calling it a windfall. Let me explain.
You see, if I leave a twenty dollar bill in a winter jacket only to rediscover it after it has been hanging in the closet for nine months, that's a windfall.
Now I can hear a lot of you out ...
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Why Baseball’s Jayson Werth Is Worth $126 Million (and You’re Not)
This is a guest post from my good friend, Mr. Credit Card, from www.askmrcreditcard.com. For the past three years, his Philadelphia Phillies have been the nemesis of my beloved Los Angeles Dodgers.
I certainly feel we can learn a lot from how baseball teams run their franchises and how they develop, buy, and trade players, and then apply that to our financial lives.
The Rumors and Free Agent Market - Baseball season is over and fans and aficionados are now eagerly watching the free agent market to see which players go where and who buys who. There are several top free agents in the market, but I want to highlight two in particular.
Firstly, Jayson Werth, who is the right outfielder for the Phillies the last three years is a free agent this season. Actually, he was a free agent until he signed a $126 million, 7-year contract with the Washington Nationals earlier this month. As the top right-handed outfielder in the free agency market this year, folks justifiably expected him to demand top wages and a fat contract, and he got it. As a point of reference, Matt Holiday landed a seven-year, $120 million contract the Cardinals last off season.
Cliff Lee is also another huge free agent in the market this year. He was acquired by the Phillies in 2009, but was traded this past season because it was perceived he wanted to test the free market! He moved to the Seattle Mariners and was later traded to the Texas Rangers before the trade deadline this year. He was obviously a big factor in the Rangers charge to the World Series.
Over the past three seasons, Lee was 48-25 with a 2.98 ERA, 17 complete games in 93 starts, five shutouts, 667 1/3 innings pitched, a 1.122 WHIP.
Lee is 7-2 with a 2.13 ERA, three complete games in 10 starts in the post season.
Although Werth is now off the market, baseball clubs still have to make a decision as to whether or not to bid for Cliff Lee and, if so, what they're willing to pay him. As I eagerly watch the free agent season play out, I can't help but see the parallel between the financial decisions baseball clubs make and personal finance decisions us fans make. Here's my take.
Never Settle For Being Average - Because Top Guys Get Paid A Lot More - Some of you might be astounded by the numbers that Werth and Lee can command. Well, that is reality folks. The top guys in any industry, whether it is the CEO, company founders, music artist, make a heck of a lot more than the average Joe in the same industry.
The top hedge fund owners with billions under asset management take home a lot more than the small ones with a "couple of hundred million in assets." Likewise, top music artists rake in a lot more than than average ones, and the top movie superstars make lots more than their supporting cast mates and even the people actually producing the films! Yes, that's life.
Open a pizza shop in your neighborhood and you are still an employee for yourself and making employee wages! Open a few more stores, and your rewards go up! Franchise your restaurant nationwide and you will become a really wealthy -- and if the world world likes your product, then the gap between your wealth and that of the common folks widens to astronomical levels.
So never settle being second best. Always strive to be the best in your work, your career because the rewards for moving up the ladder are exponential indeed.
Live Within Your Means - From the players, let's move back to the baseball organizations. Yes, Jayson Werth got a huge contract. So why didn't my Phillies sign him? It's because they already have a $146 million payroll. Even they need to "budget" just like the rest of us. If they signed Werth, they would almost certainly have had to sell or trade a highly paid player to make room for Werth's salary.
On the other hand, the Pittsburgh Pirates are not exactly an elite team. In fact, their payroll was only $36 million for 2010. Contrast that to the New York Yankees ($200 million) and there is a vast gap in their resources. Since the Pirates are certainly not playoff contenders, they have to settle for much less if they want to operate with their finances in the black.
The bottom line here is, whether we are millionaires, a billionaires or thousandaires, we all have to live within our means because, unlike the federal government, we cannot print money!
Always Consider Long Terms Costs And Obligations - There is always considerable debate as to how long a contract any club should offer a free agent. Lee and Werth are obviously valuable now, but the big question is will they still be good players down the road.
In our own personal finance lives, we have to consider long-term expenses as well. For example, trying to decide how big a house can we afford. Even if we can "afford" one based on our "present income", bear in mind that our "future income" may not be the same. It could be lower!
This is not to say you should not take on any long term financial obligations. But you have to make sure you are getting great value out of it and not overpay for these items.
There Are Different Paths For Different People - The Yankees are the biggest franchise in baseball. Their huge fan base allows them to get even bigger, spend more on very good free agents and keep winning. Their strategy has always been to be the biggest franchise. This is the same strategy followed by other big sports club like the Los Angeles Lakers and Manchester United.
The Yankees do not mind paying up for a free agent because they dislike trading their farm system.
Compare them to the Pittsburgh Pirates, who are obviously not a household name. For them, being the best baseball team and having the largest franchise is not realistic. So their approach on free agents is different from high-payroll teams like the Yankees and Phillies. Since the Pirates cannot afford top-tier talent they rely almost soley on their farm system.
We as individuals also have to plan our personal finances around our goals, objectives and means. For instance, should we open a joint account? Should we save our money or use it to pay down debt? How much should we put aside for retirement? No one can answer those questions for us; we have to do what is right for us. For example, some people can afford the annual fees and perhaps benefit from carrying an American Express Platinum or a Chase Sapphire credit card, while other folks may simply choose not to carry one at all because it might lead to overspending and credit card debt.
Be Creative And Seek Value - The Phillies didn't decide to sign Werth to a long term contract, but they can still be creative and perhaps find a way to offload another player like Raul Ibanez, and then rely on Ben Francisco and Dominic Brown to platoon right field.
We face similar decisions in our financial lives as well. Which house should we buy? Which car should we buy? Should our kids go to public or private school? If money is no object, then there is no decision to make, but for most people money is a constraint, so we have to prioritize and decide which choice provides the most value.
Treat Your Household Finances As A Business - When a baseball player gets traded against his will, or if a club does not want to renew his contract, he usually says "it's only business." Yes, it is business; a baseball organization has to do what is right for the franchise. It is the same with our household personal finances. We have to approach them like a general manager of a baseball club. We need to plan ahead and make decisions that are right for our individual situation. ...
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The (Dead)Beat Generation
Should you walk away from your mortgage just because your home depreciated?
So you refinanced. Or bought too much house. You divided the mortgage payments by your income, and decided you could swing something a few percentage points higher than the recommended 2533 because the market was rising and your house would make you rich just by existing.
You relied on speculation as an investment strategy (not even your own speculation, but other peoples.) But your house got cheaper, maybe cheaper than what you bought it for. Thats called losing money on an investment, which happens all the time, but people think it oughtnt when your bedroom and kitchen are inside the investment.
The market might bounce back. If youre 7 years in, lots can happen in the remaining 23 on a 30-year mortgage.
When you lose money on a stock, your (invisible) bank account gets wiped out. Owe more than your vehicle is worth, and it might get repoed. But stop making payments on a house, and theres a letter from the constable on the door, maybe some yellow tape involved hard to keep that quiet from the neighbors. Also, people getting forcibly removed from their house (its yours and not the banks only after you pay the entire mortgage) make for striking photo and political opportunities. After all, bankers are evil. Meanwhile, its the working stiffs just trying to make ends meet who get raked over the coals. (Wow, a sentence composed entirely of idioms. Mike Lupica approves.)
Some people who make enough to cover the mortgage dump the house anyway the strategic default. They assume investment values only move in one direction. According to Experian, that includes 20% of defaulters.
This is hiding behind the law. Stop making payments, and its not like youll be evicted that week. It takes months, even years. The idea here is to take the mortgage payments and put them toward, say, your credit card balance, figuring the lender will gladly renegotiate a contract you signed in order to get some sort of return on its investment.
Some borrowers think this is fine because if the lender kicks you out, itll be tough for them to sell the house to someone else in a down market anyway. The lender at least wants the house to stay lived in.
This is nonsense. Strategic defaults hurt everyone.
A strategic default does to your credit score what O.J. did to Nicole. Youll never be able to borrow either a) again, or b) until Congress and the White House decide that so many people need to improve their credit score that it just wouldnt be nice to let something as insidious as that have such power over their lives.
Whats the solution? Well, no politician of either party wants the other accusing them of standing by while old ladies and cripples are being kicked out of their houses. The government would then essentially renegotiate mortgage contracts, setting caps on future ones and insisting the lenders take less. Under this type of forced renegotiation, the borrowers dont even have to sack up and face the lenders themselves.
Besides, neighbors, professors, and the blonde lady on TV say defaulting is fine. And for PR reasons, lenders are hunting down deficient borrowers about as aggressively as the federal government goes after illegal immigrants.
Say you walk away from your mortgage, mail your keys to your lender (this is how its done), then rent somewhere. Your (old) neighbor follows, then a third. No matter how swank a neighborhood you deserted, the lawns turn brown and the pools green because no ones living in the houses. Which reduces the value of the remaining houses. Now the people who stayed behind and havent (yet) defaulted watch their homes values decline. Which means theyll likely owe more than their houses are worth, making it more likely that those folks will default. Continue like this, and you end up withDetroit.
When you declare bankruptcy, you can renegotiate to protect yourself from creditors. But strategically defaulting is the opposite you keep all your assets except the house and mortgage.
So what to do? Four choices:
1. Man up, economize and make your payments. Youre obligated to the lender, yourself (to preserve your credit), any kids of yours (unless you dont think you need to set an example) and society. If you steal from your lender, it doesnt directly affect the rest of us, but it makes civilization incrementally more difficult to live inthe broken window theory.
You dont like that answer? Its a house, for crying out loud. You need somewhere to live. No matter how much value it loses, its still better than renting and never building a dime of equity. Stop assuming that because your $100,000 house lost 10% of its value last year, itll lose a similar amount next year and by 2021 will be worth -$10,000.
2. Short sale. If you know you cant make your payments, and youve exhausted every possible way of earning or otherwise securing money, call the lender and come clean AS SOON AS POSSIBLE. Theyll sell the house at a loss, just to get you out of there and collect their money. Youll still be on the hook until the bank resells the house, but that wont last forever and at least you can stop throwing good money after bad.
3. Ask for a loan modification. Its begging, but your pride already left a while ago.
4. The Deed in Lieu of Foreclosure. Tell the lender, Look, I cant make the payments. Lets not short sell, Ill just give you the damn thing to get out of this debt. This hurts your credit rating the least, and tells the lender not to worry about you being one of those evictees who pours concrete in the toilets and makes off with the copper wire.
And next time, get a vanilla 30-year fixed-rate mortgage.
About the Author
Greg McFarlane lives in Las Vegas, winters in Maui, travels the globe and hates working for other people. He recently wrote Control Your Cash: Making Money Make Sense, a financial primer for people in their 20s and 30s who know nothing about money. You can buy the book here and reach Greg at greg@ControlYourCash.com. ...
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2009 Drive-By Movie Retrospective: Or How I Earn $4/Month Blogging (And You Can Too!)
Me: Well, Honeybee, thanks to Netflix you and I have watched a lot of movies from the comfort of our living room.
The Honeybee: I've got a question for you, Mr.Financial Genius: Is Netflix paying us for yet another one of your blatant plugs for ...
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What Would YOU Be Willing to Do for a Million Dollars?
Several years ago I wrote a very popular post highlighting the seven deadly sins of personal finance. Of course, one of those seven deadly sins was greed.
Greed often makes people do some really crazy things they wouldn't otherwise ...
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Flexible Spending Accounts Provide Free Money. Why Pass It Up?
The relentless rise of health care costs can really put a strain on your household budget. Even with an insurance plan, health care expenses can add up when you consider most people still have to pay deductibles, copayments and other items not covered by insurance.
A great way to offset these rising costs is through the use of flexible spending accounts (or FSAs). FSAs are employer-sponsored accounts that allow employees to make pre-tax contributions. FSAs provide tax savings that help offset health care and dependent day care expenses.
Any contributions you make to your FSA can be used to pay for out-of-pocket medical expenses that are not covered by your health insurance plan - so by taking advantage of FSAs you are, in essence, allowing the government to subsidize a portion of your unreimbursed medical expenses.
How FSAs Work
Let's say after sitting down and thinking it over, you estimate all of your unreimbursed medical expenses for the coming year will be $1000. At enrollment time, you instruct your employer that you wish to put $1000 in your FSA. Your employer will then deduct a portion of that amount from your paycheck each week (in this case, $19.23) before taxes.
At anytime during the year, you can tap the money in your FSA to cover your qualifying unreimbursed medical expenses, even if your account isn't yet "fully funded." In other words, if your FSA contribution for 2010 is $1000, you can withdraw all $1000 to pay for qualifying unreimbursed expenses incurred during the first week of January, even though you've only contributed $19.23 into the account.
How do you "tap" the money? I pay the fees in advance and then submit the receipts to my plan administrator who then issues me a check. But I also have the option of using a special FSA debit card as well that will make the payments in real time.
The higher your marginal tax rate, and the more you put in your FSA, the more money you'll save. Somebody that puts $3000 into an FSA and sits in a 25% tax bracket is essentially saving themselves $750 every year.
That's $750 of free money - so why would anybody pass that up?
Fear is a Lame Excuse for Leaving Free Money on the Table
As this New York Times article shows, most people fail to take advantage of FSAs because employee contributions to an FSA are "use-it-or-lose-it. What that means is if you fail to spend the money in the account before the coverage period ends, any unused funds are lost.
What a lame excuse.
Actually, it's a pitiful excuse - but a lot of people use it anyway. The Times article notes that although 85 percent of companies offer FSAs, only 22 percent of employees take advantage of them.
How sad.
I can understand being afraid of leaving free money on a table if it is being guarded by an angry rattlesnake. But to throw away free money simply because you're afraid you might not meet some silly little requirement is really inexcusable - especially when you consider all it takes for most folks to avoid that scenario is 30 minutes of their time so they can plan out and estimate in advance their unreimbursed medical expenses for the following year.
With two kids currently wearing dental braces, my unreimbursed orthodontia bills more than cover my $3000 annual FSA maximum limit imposed by my employer. But even when the kids weren't in the midst of their current orthodontia program, we had little trouble covering the maximum. When you consider eye glasses, contact lenses, saline solution, dentist and doctor copays, unreimbursed prescriptions, cold and other off-the-shelf medicines, band aids, and other qualifying expenses for a family of four, it didn't take much effort to get there.
Coverage periods depend on your employers specific plan, although most plans follow the calendar year. My company's plan even offers a very generous three-month grace period for filing claims.
If you are still worried about losing money, I would recommend you start slowly and gradually increase your FSA limit each year until you feel more comfortable with the process.
That's what I did.
The first year I took advantage of an FSA I only signed up for $500. That year I had reached $500 in unreimbursed expenses by June and I remember wishing I had signed-up to put more in my account. The following year I upped my contribution to $1000. By the third year, I doubled it again. I am now contributing $3000 to my FSA and it is a very important benefit I count on every year to help me save money.
Another benefit of the FSA is it acts as a quasi-savings device. We usually compile all of our receipts in a special file and then request our entire reimbursement check all at once sometime in the latter-half of the year. The $3000 check makes for a nice "windfall bonus" that we use to pay for big purchases.
What Are Qualifying Expenses?
Although there are exceptions, the list of qualifying expenses is usually big enough to drive an ambulance through. For a complete list of deductible medical expenses, check out IRS Publication 502. But, as cited in that Times article, here is an example of how varied the expenses are:
- Over-the-counter medicines of all types
- Cough drops
- Calamine lotion
- Mental health therapy
- Lab tests
- Dental braces
- Lasik surgery
- Aids to help you stop smoking
Just keep in mind that, as of 2011, over-the-counter medications must accompany a note from your doctor to qualify as an allowable expense.
Keep in Mind Your Employer Can Make Exceptions!
It is important to know that employers are free to choose what their FSAs will cover. The Times notes that while the vast majority of firms simply follow the IRS rules, some do make exclusions, so check with your employer's benefits department to see how your company varies from the IRS list of approved expenses.
In Conclusion...
FSAs are something to be embraced, not feared. They not only reduce your tax liability, they also can act as a de facto quasi-savings plan. Yes, if you fail to plan, you may end up losing a portion of your contribution - but that is a poor excuse for passing up one of the more valuable benefits that your employer provides to you.
All it takes is a small amount of planning on your part. :-)
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It’s Time Unemployed People Start Working For Free
Okay, not all unemployed people, but definitely some of them. Let me explain.
Last month the U.S. House of Representatives passed another 13-week extension of unemployment benefits on top of the current California maximum of 79 weeks. And just last week, Senate Majority Leader Harry Reid (D‐Nevada) introduced a proposal to extend unemployment insurance by up to 14 additional weeks for jobless workers in all 50 states. The proposal would also extend benefits for an extra 6 weeks in high unemployment states.
Assuming these provisions survive and eventually get signed into law by President Obama, it means qualifying individuals in California will be eligible to receive unemployment benefits for up to 99 weeks. (UPDATE: In April 2010, President Obama signed the bill into law after the Democratic majority in Congress passed the legislation on what was essentially a party-line vote in both the House 289-112 and Senate 59-38.)
The cost of this extension is estimated to be on the order of $70 billion. Of course, U.S. lawmakers have not figured out whether or how to pay for that, so they'll just cover it in a manner that requires the least amount of political courage. That is, they'll just print more money - damn the torpedoes and thank you very much.
That being said, for now let's forget about the financial impacts and just focus on the magnitude of time, shall we?
Ninety-nine weeks.
If we're going to talk about the length of time that certain people should be getting paid unemployment benefits, I have to insist on raising a bit of a stink. Come on, that's almost two whole years.
Hey, I have nothing against the number 99 per se.
Ninety-nine is a terrific number if you're the greatest hockey player who ever lived. Or a secret agent.
But 99 is a ridiculous number when it comes to the number of weeks the government allots some people to find a job while enjoying the luxury of a safety net. To be more specific, I have no doubt this is a big reason there are now a growing number of people who characterize themselves as being happily "funemployed."
According to this expose by the Los Angeles Times, the funemployed are "usually single, in their 20s and 30s and find that life without work agrees with them."
This story by CBS News asks, "If the economy is so dismal, why are victims of the recession smiling?"
I'll tell you why: Because a lot of people are collecting $475 per week in California or $900 per week in Massachusetts for doing absolutely nothing!
Most of those smiling people are single, under 35 and either have a low mortgage payment or are renting an apartment.
One of my coworkers was telling me about a friend of his who fits that profile who absolutely refuses to look for a job until his jobless benefits run out. He's having a blast and the Unemployment Office isn't paying enough attention to notice that he isn't really looking for work anyway.
And who can blame the guy? Why work for $10 bucks an hour stacking boxes when you earn $11.88 per hour sitting at the beach or skiing at Mammoth Mountain?
If the government is going to continue to extend unemployment benefits, then the state unemployment offices need to do a better job policing those who are receiving them.
I say that before anybody receives a single cent of extended unemployment benefits resulting from the Federal Emergency Unemployment Compensation program, they should have to prove they are making a good-faith effort at finding a job. After 52 weeks, and until they can show otherwise, people that have failed to meet such a modest requirement should be required to do community service for 20 hours per week in order to continue to receive further unemployment benefits.
After 72 weeks, the community service requirement for failing to demonstrate a good-faith effort to find a job should increase to 40 hours per week.
No community service, no check.
If you want to stay "funemployed," be my guest, Skippy - just don't expect the taxpayers to subsidize you.
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The 10 Most Overpaid Jobs
Oh, am I going to make some enemies today. ;-)
Last week I did a very well-received article on the 10 most underpaid jobs. Today I tackle the other, more controversial, side of the coin - the 10 most overpaid jobs.
First I want to apologize ...
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The 10 Most Underpaid Jobs
Most everybody thinks they're underpaid for what they do. But in reality, there are a handful of select jobs where this claim is especially true. Here's my take on the 10 most underpaid jobs. Unless otherwise noted, annual income figures are based on data from the U.S. Bureau of Labor Statistics.
After reading this list, if you think I've overlooked a particular job (like yours), please leave a comment and let me have it with both barrels. Just keep the profanity and ad hominems to a minimum.
10. Janitor
Average Annual Income: $23,500
Annual Income If It Were Up to Me: $45,000
Appreciation Meter: Office outcasts rarely invited to workplace birthday celebrations and promotion parties.
Why They're Underpaid: In office buildings and schools all over the world, janitors quietly go about their job of picking up everybody's mess. Their work is usually done behind the scenes, so it's easy to overlook the fact that they often have to deal with some really messy clean-ups like throw-up and excrement. When they leave work the place is spotless. They do this knowing the next day they'll just have to it clean up all over again. Talk about a Sisyphean challenge.
9. Youth Sports Referee/Umpire
Average Annual Income: $28,330
Annual Income If It Were Up to Me: $50,000
Public Appreciation Meter: Slightly above the small pox virus, but one notch below dog poop. Okay, okay -- two notches.
Why They're Underpaid: Without these extremely tolerant men and women, there would be no organized sports leagues for our kids. Despite that fact, the next time you want to pick-up a few fresh insult lines that would make a sailor blush, stop by your local park and take in a youth sports competition. When you consider all the abuse that these referees and umpires take on a daily basis, it is a wonder that anybody actually aspires to be in such a position in the first place.
8. Little League President / Board Member
Average Annual Income: $0
Annual Income If It Were Up to Me: $35,000
Public Appreciation Meter: More likely to be approached by folks carrying pitchforks & torches than "thank you" letters.
Why They're Underpaid: I was a Little League President for two years, so I know what I am talking about here. For a volunteer, the hours are extremely long - upwards of 40 per week. Everybody is always upset at you, calling at all hours of the night to complain about trivial things. And when you're not acting as the League's pin cushion you're playing psychologist, soothing the bruised egos of parents who all think their kid is the second coming of Derek Jeter. Good times.
7. Nurse
Average Annual Income: $65,130
Annual Income If It Were Up to Me: $150,000
Public Appreciation Meter: Not too bad, actually.
Why They're Underpaid: This job often requires a cast-iron stomach and entails very long hours with sometimes-grumpy and uncooperative patients. I say anybody who has to assist with surgeries, change bedpans, insert catheters, give injections and sponge baths, and provide other general care and comfort to the sick and injured on a daily basis is almost by definition, underpaid.
6. Exterminator
Average Annual Income: $31,210
Annual Income If It Were Up to Me: $125,000
Public Appreciation Meter: Exterminated.
Why They're Underpaid: Exterminators often have to work in dark and tight places. They're often required to work with hazardous chemicals too. The worst part though is they're constantly at risk of being bit or stung, or contracting rabies, hepatitis, or other diseases from vermin that most of us would just as soon never even have to look at: poisonous snakes, rats, black widow spiders, rabid raccoons, skunks, bats, gators, bees, mice, cockroaches, and rats. "Uh, Len, you said 'rats' twice." I know - that's because I really hate rats.
5. Septic Tank Servicer
Average Annual Income: $35,550
Annual Income If It Were Up to Me: $135,000
Public Appreciation Meter: "You mean somebody actually has to clean those things out?"
Why They're Underpaid: Their job description stinks - and I mean literally: Clean and repair septic tanks, sewer lines, or related structures. Clean and disinfect domestic basements and other areas flooded by sewer stoppages. Withdraw cables from pipes and examine them for evidence of mud, roots, grease, and other deposits indicating broken or clogged sewer lines. By the way, I'll give you two guesses what "other deposits" could be, and the first one doesn't count.
4. Embalmer
Average Annual Income: $39,320
Annual Income If It Were Up to Me: $150,000
Public Appreciation Meter: Better than some professions, but not as good as most.
Why They're Underpaid: When I was growing up I lived next door to a mortician. I still remember the empty industrial-sized containers of embalming powder he kept in his garage to store everyday stuff. My family became close with his and we did a lot of things together. Uncle Chuck was such a funny and easy going guy, which always amazed me considering his very somber duties at the mortuary, stories of which he shared freely with us kids as we became teenagers. One of his duties was embalming; it is a difficult and surprisingly physically demanding job. To this day I still remain amazed at how Uncle Chuck could be so easy going and carefree at home considering all the sadness and heartache he encountered on a daily basis at work.
3. Lineman
Average Annual Income: $54,300
Annual Income If It Were Up to Me: $200,000
Public Appreciation Meter: Only when the local power goes out.
Why They're Underpaid: Not too surprisingly, this job regularly ranks among those with the ten highest fatality rates. This job is much worse than that of a professional tight-rope walker, as it combines nerve-wracking heights with extremely high electrical currents. If that doesn't convince you, maybe this will. And if you have a few extra minutes, maybe even this.
2. Trauma Scene Clean-up Worker
Average Annual Income: $35,000 (according to answerbag.com)
Annual Income If It Were Up to Me: $250,000
Public Appreciation Meter: Dead on arrival.
Why They're Underpaid: Did you ever wonder who goes in and cleans up the blood, guts and random body parts after major car accidents, homicides and other similar tragedies? I don't think most people do -- they just figure a site magically cleans itself up after the authorities leave the scene. I once spoke to a guy who used to do this for a living and he said the job is absolutely horrific and often requires superhuman intestinal fortitude and emotional control. Here's a chilling job description that warns potential job applicants what to expect and here are some common tools of their trade.
1. Military Soldier/Sailor
Average Annual Income: $16,794 (First-year, enlisted)
Annual Income If It Were Up to Me: $1,000,000
Public Appreciation Meter: Getting better, but still not enough.
Why They're Underpaid: The job of a soldier is, without a doubt, the most underpaid job in the world. In addition to being charged with putting their lives on the line on a daily basis in order to protect us and our way of life, the soldier's job description also entails many of the difficult jobs previously mentioned. On top of that, they often have to do their jobs with minimal sleep, rations, and almost impossible living conditions. The freshest US recruits have to do all that for a base salary of just over $16,000 per year -- and after their military taxes are deducted it's even less. We should all keep that in mind the next time we think we're underpaid for what we do.
So there you have it: the 10 most underpaid jobs. If you're interested, you might also want to check out my list of the 10 most overpaid jobs -- I'm sure that'll ruffle a few feathers out there. ...
Continue reading The 10 Most Underpaid Jobs
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