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I'm torn. I can't decide if my love for our dog outweighs my distaste for feeling duped into buying yet another kind of insurance: pet insurance. Yes, it's real with actual revenue numbers to back it up. Opinions vary regarding its merits: this piece acknowledges the value, while this piece does not. Then there's this information about calculating the worth of your pet.
If you ask me, it's impossible to put a price on a face like Gertie's. But I think I'm in the "factor it into your budget" camp. In other words, instead of paying premiums to a pet insurance company, open a pet savings account and "pay yourself" instead. If we put money aside now, not only will it be there if we need it but we'll get the benefit of compounding interest.
But that's only half the story, the money-saving, budget-conscience half.
Isn't there a stewardship issue here? Don't think so? Maybe this piece will change your mind. It willl certainly incense the hard core pets-aren't-people-they're-possessions crowd. Even a big-time pet lover like myself was taken back. Listen to this:
APPMA reports that 42% of dogs now sleep in the same bed as their owners. I'm not judging anyone... yet.
Half of all dog owners say they consider their pet's comfort when buying a car. I barely consider my kids' comfort.
With annual growth nearing 50%, the pooper scooper industry is now experiencing a lot of consolidation...There's a "pooper scooper industry"?
I'm not going to say that some of these crazy things people do for their pets are morally or even financially wrong because I don't know their heart or their giving. But it's hard not to have questions when you learn that Fido could be put on a cocktail of Slentrol and Reconcile; one for the unwanted pounds he put on while being depressed and the other for the depression from all the canine separation anxiety. My question in particular: Why medicate when he could just have liposuction and go everywhere with you in your canine-cozy Caddy? ;-)
Is it just me or is there a financial stewardship issue banging around in here somewhere? I think so, or at least there certainly can be without proper balance. You see, I want my giving to reflect how much I love the God and love other people. So it's more about my love for Him and less about my lack of love for Gertie.
Besides, when pet cloning comes down in price, Gertie will know how much we love her for the rest of her lives.
(This piece originally appeared in a July 2007 blog post (membership required) of The Sound Mind Investing Weblog.)
The New York Times' Bucks blog offers good follow-up info on a topic we discussed in the June issue of SMI (subscribers' link): using multiple savings accounts as an aid to reach specific savings goals.
From Bucks' writer Jennifer Saranow Schultz:
A growing number of banks are offering features intended to help you allocate various savings accounts to specific goals.
As of [July 1], FNBO Direct customers no longer have to fill out complete applications to open new savings accounts. Instead, FNBO Direct fills out most of the applications for them. The new feature is aimed at making it easier for customers to open multiple savings accounts, each of which customers can name for a specific savings goal and all of which customers can track online with the same user name and password....
Since last year, Ally Bank has also had a similar offering, including the ability for customers to quickly set up multiple savings accounts, "nickname" them and see them all in one place online.
A spokeswoman for ING Direct, which has long offered such features, said 10 percent of the bank's customers had multiple savings accounts, with the top five nicknames (or savings goals) being "savings," "vacation," "emergency fund/rainy day," "house" and "taxes."...
Many credit unions also offer similar features as do other banks, including Capital One and Bank of America.
As we noted in our June article:
Having a series of dedicated savings accounts creates a structure that will help you follow through on your savings goals, especially when combined with automatic transfers from your checking account.
Goals can be a powerful driver of behavior, and being able to see — at a glance — how much is in each of your accumulation accounts (as well as in your emergency fund) lets you know exactly where you stand in relation to your various savings goals. As you see your balances rise, you'll be encouraged to keep moving forward.
For Ally customers, step-by-step instructions for setting up multiple accounts are here. Details for ING customers are here.
Below, Bob Lotich of ChristianPF.com explains how he uses ING's multiple-savings-accounts feature, which he calls a "virtual envelope budgeting system."
"Christmas Club accounts are now largely a thing of the past (undercut by the rise of easy credit)..." — so I wrote in the current issue of the Sound Mind Investing newsletter in an article on multiple savings accounts (subscribers' link).
That's true — Christmas Clubs have faded into the past for the most part.
But a reversal may be in the offing. Sears/Kmart promoted a Christmas Club program last year. Now, the New York Times reports another major retailer is rolling out such a club for this year:
Toys "R" Us is counting on an Eisenhower-era tactic to get consumers to spend this Christmas. The toy retailer will begin offering a "Christmas Savers Club" [this week] that allows shoppers to put money away with the company for holiday gifts.
Participants will receive a card similar to a gift card, and can contribute funds to it through cash or credit card payments. As an incentive Toys "R" Us will add 3 percent interest on the balance.
The program is a throwback to what banks and credit unions offered in the 1950s and 1960s before credit cards allowed people to spend money they did not have.
Our Level 2 article focused on Christmas Clubs run by banks, but many retailers had them too back in the day — to build customer loyalty, of course. That's exactly what Toys "R" Us is going for.
Shoppers can sign up for the program in Toys "R" Us stores, either at the cash register or the customer service stand. The company will add the interest on the balance as of Oct. 16, and the funds will be available Oct. 31 for purchases at Toys "R" Us and Babies "R" Us stores and Web sites.
Earning 3% is nothing to sneeze at these days, but unless you are absolutely, positively planning to buy something from Toys "R" Us — and you know exactly how much you're going to spend — it's probably better to set aside your Christmas savings in an earmarked bank account.
Earlier this week, I talked about the benefits of having multiple earmarked accounts with host Bob Crittenden on Faith Radio's Faith Meeting House program. Listen below (13 min.) — or download an mp3 (right click/save as).
The fundamentals of good financial management aren't difficult, but they do require 1) planning and 2) discipline to stick with your plan.
In a short interview Monday on Alabama's Faith Radio, SMI assistant editor Joseph Slife (right) talked with host Bob Crittenden about the importance of having a savings plan. In a follow-up to air soon, he'll discuss a simple way to make sure your savings plan works.
Use the audio player below to listen — only 7 minutes!
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