Handling Finances

I keep summarizing our finances to my wife. I let her know where our money is kept and how much money we have. We discuss our plans and goals regularly.

Still, when I asked my wife where she would find our emergency fund if I was incapacitated in an emergency, she had no clue. It turns out that while my wife is interested in our finances and in our financial future, she really couldn’t care less about the details. Before we got married, she was generally good with finances — spending less than she earned while occasionally paying a bill late due to disorganization. Now that I take care of money and keep her updated as to our general progress toward goals, she just doesn’t bother to pay further attention.

I don’t think that’s a problem — as long as we continue to communicate and align our goals, we won’t run into serious problems if just one of us takes care of financial details. Still, she does need to be able to access our money in an emergency, so I’ve begun working on my alien abduction package. It will include instructions and important account numbers for all our accounts including which accounts she owns and which (like retirement accounts) will need to be transfered to her if I’m abducted (we don’t like to talk about me dying).

We don’t yet have a safety deposit box, so I will likely be encrypting a copy I can keep in a reasonably secure online file-saving account.

It’s taking me a bit of time to get this together, but I’ll post a reasonably scrubbed version as Mrs. Micah did at the link above. It should make reasonably interesting reading as it will include both the location of my money as well as the reasoning for this location and special instructions on how accessing it may be complicated.

It’s my dream card come true!  While perusing my daily dose of blogging, I found an article about the Revolution Card at CashMoneyLife.com.  This credit card is exactly what I’ve been looking for, but as such a new service, it isn’t yet accepted by the merchants I use regularly.

The Good Side

The credit card is friendly to merchants (unlike existing credit cards in the USA) as it only charges a reasonable 0.5% per transaction rather than the more common 2+%.  As much as I like getting cash back, I’d rather not throw even more money at greedy banks and keep it circulating in my local economy!  I find the high interchange fee rather unpalatable and perhaps even immoral as the pseudo-monopoly held by visa and Mastercard has restricted any competitive cost-down pressure.

The card also has no name or number embossed on the front and even better — it can only be used with a pin number, not a signature!  That means unlike debit or credit cards that can currently be used by thieves since nobody checks signatures, this card can only be used illicitly if somebody steals both the card and your pin number (not likely).

For even more security, you can generate temporary pin numbers — great for online purchases, or a one-time thing at a store you don’t quite trust.

The Down Side

Patrick at Cash Money Life had some good criticisms of the card — namely that since it requires a pin number, it will be more difficult to process in places like restaurants and bars where they’re traditionally taken or kept as collateral for a tab.  Since you have to be present and (presumably) sober to use your pin number, this card won’t be as handy for people who regularly eat out.  Still, I feel rather nervous leaving a credit card with a waitress as the magnetic strip can be copied and stolen so I would welcome an excuse to follow the waiter to a card swiping machine.

The biggest issue for me is the short list of stores that accept the card.  While they include large chains like Kohls, CVS, Walgreens and Rainbow, they don’t include my everyday stores like Cub Foods or Target or even any gas stations as far as I can tell.  I will apply for this card as soon as I feel like I would use it regularly, but they have some recruiting to do before I personally will take the plunge.

The Verdict

The advantages to this card are not huge.  While security is highly important to me, credit card companies universally cover any fraud past the first $50 so financially it’s not a huge issue.  It’ll still be a huge hassle to get your money back, but it’s not hard to get your money back.  I’d much rather have a card that largely prevents theft, but I don’t feel my money is in danger now.

Some people with good credit might be able to get competitively low rates (the rates are largely based on credit history) but you could probably get an even lower rate with a card that charges higher merchant fees for obvious reasons.

The main advantage, then, is the low interchange fee which users never see.  Quite honestly, I’d be paying a bit more for my purchases than I do currently as I wouldn’t receive kickbacks in the form of ‘cash rewards’ for my credit card purchases.  At the same time, the more of my money that goes directly to those that provide goods and services I want, the better for the entire economy.  It’s a small effect, but barring legislation like that in Australia that limits interchange fees to 0.5%, I’d prefer to vote with my wallet and use the more efficient method.

For me, then, the main down-side is the limited acceptance of the card.  I’ll be watching this card closely and as soon as I see it being accepted by gas stations or my local supermarkets (or even better, some of the smaller stores I shop at), I’ll get myself a card and ‘be part of the revolution’ (sorry — I couldn’t resist).

I’m not interested in discontinuing my blog, but I’ve come to realize that I’m starting to stretch to meet self-imposed deadlines.  Regular posting was quite valuable as a tool to get me started, and I’m reaching the point where I must either start relating tiny personal details or simply recycle other bloggers’ content to stay as active.

I will continue to post 1-3 times a week which will let me focus on topics that I think haven’t been covered everywhere else and to put more research into each post without skimping on the rest of my life.

In other news, I’m not alone in thinking that buying in bulk isn’t always the best or even the most frugal option as I wrote about here.  It’s good to know I’m not alone in my difficulty with sugary (or any snack really) cravings.