Ace Wisdom

I unknowningly participated in simplistic business research when I was a kid growning up at the City Club. I didn’t realize the magnitude of the research at the time, but in hindsight it taught me valuable lessons.
My Grandma Myrna had invited “Big John” from Sheboygan Restaurant Supply to stop at the City Club to discuss “shot glasses”. She bought most of her restaurant supplies from Big John. I think I was about 12 years old at the time and I was invited to this serious meeting. The objective was to find a new “shot glass” for the bar. You know, the old “shot and a beer” routine. The new “glass” must hold less booze but look like it was actually more. Huh?
Big John brought along 10-15 different shot glasses for review. The City Club had a habit of filling shot glasses to the very top to make the customer feel that he got his moneys worth. Acceptable practice is to deliver a minimum of 1 ounce of liquor. Myrna wanted to find a glass that (1) delivered at least an ounce of booze, (2) looked like there was a lot of booze in the glass, and (3) actually delivered less liquor than the present glass. She was looking for the perfect shot.
There is big money in shots of booze. You get about 30 shots from a bottle of brandy and you can do the math. If you get $1.00 per shot (I actually don’t know current rates), a bottle of brandy can produce $30 in revenue. If a bottle of brandy costs $10, the profit would be $20. Pretty good profit margin. Now imagine if you could get 35-40 shots from that same $10 bottle of Brandy. Hey, we were talking major profit improvement.
We lined up all the potential new shot glasses on the bar and carefully filled each with one ounce of Brandy. The one that filled closest to the top of the glass and looked like it contained the most booze would be the winner. I never realized how many deceptive ways you can design glass bubbles into the bottom of a glass to make it look full. There was one glass that did it all. It looked full and it wasn’t. It reduced the amount of booze in each shot but because it looked very full, the customer would feel good. Myrna would improve her profit on a bottle of Brandy by 10%-20%. Big John got a order for a gross of new shot glasses. Everybody wins.
In reality everybody didn’t win. The customer was being deceived into believing he was getting a whopping shot glass of booze and he was actually getting less. What the hell! He was happy and didn’t know the difference.
Why recount this early business research? Well I went to buy a tube of “Obsession After Shave” at Marshall Fields. I got the Obsession shave balm for $35. They give you a travel kit along with a small sample of Obsession. You walk home with the big bag of stuff which makes you feel like you got your money’s worth. They always give the kit so it was the same last time I bought it. When I got home I placed the tube of new after shave next to the old one. I noticed the new quantity of after shave was 5 flluid ounces. The old tube was 6.7 fluid ounces. I checked my last purchase and found I paid the same price. So let me see, I got 1.7 less ounces of after shave in a flashy presentation for the same price. Most people wouldn’t think about it but I just got screwed out of 1.7 ounces, a 25% price increase. Damn! I may just go back to English Leather.
So my lesson Grasshoppers is that most things in life are not as they seem. Isn’t that a revelation. Stay alert. Spend you money wisely. Don’t let the world switch your shot glasses.
Love,
Dad

For those of you who remembered our 46th wedding anniversary, a sincere thank you for all the congratulatory messages. For those of you who didn’t remember, it is too late to apologize. Some of you Grasshoppers will be dis-inherited and Ryan Eisenhardt will be adopted. Can you believe Ryan personally conveyed his congratulations.
My bride and I celebrated by dining out and exchanging “cards”. Actually she misplaced her card to me and I’ve got to wait until she finds it. I’ve got a lot of jokes that could be offered here, but I refrain.
I do remember our wedding day, April 2, 1960. I was a student at UW-Oshkosh studying to be a math teacher and looking forward to a lifetime of financial riches. Yeah, right. Our lifetime commitment was made on a weekend. No trips to the Bahamas. No excursions to Europe. Nope. I had to be back in school by Monday morning.
I got home from school on Friday night, stayed at home (City Club) and looked forward to Saturday’s events. I remember having a black suit that fit kind of funny but it had to do. I got dressed Saturday morning and wandered down to the bar room in search of someone that could help me with my tie. Chuck Andes was available. He gave me instructions on how to do a “double knot”. I remember patrons of the City Club launching a series of jokes about marriage and laughter abounded.
We got married in the Plymouth Catholic Church Rectory at around 11:00 AM. The rectory? Yep, small and intimate. The Priest was Father Ziegler. He was elderly and rather perfunctory in his approach. I don’t know why, but I remember the rectory was decorated rather blandly and it seemed musty. As sunlight streamed in the windows, I could see dust mites drifting on the rays.
Attending the ceremony were George and Lyla, Grandma Alice and her dad, Jiggs. I think Addie and Jerry Lee were present. Chuck and Myrna where there. I hope I haven’t forgotten anyone! Maybe Aunt Francis?
You get the picture. Two 19 years olds ready to face everything that the world had to offer.
The actual marriage ceremony was short. I don’t think I missed any of the “lines” that you repeat after the Priest. We exchanged gold band wedding rings.
Your mom says she remembers the kiss after the Priest said “you may kiss the bride”. She said it wasn’t your average peck on the lips. It was a long passionate kiss. That kiss sealed the deal. Together forever! Does anyone really understand the enormity of the commitment?
We had an intimate dinner at Riverdale in Sheboygan and mostly family attended. It was one of those April days with clouds and sun alternating thoughout the day. A reception was held back in Plymouth at George and Lylas.
We borrowed George and Lylas black Pontiac Bonneville with the 400 cube engine and positraction drive for our wedding night. Why is it I can remember every detail about the car?
After a one night get-away to exotic, romantic Fond du lac, Wisconsin it was back to our regular routine. Shelby went back to Mooney and Mooney law offices on Monday morning. I was back at class in Oshkosh.
I do remember thinking on my way back to Oshkosh “what did we do”?
So 46 years together began with a memorable kiss. Each year is a gift. There are many, many special memories. Somehow it all worked out. So to my bride, Happy Anniversary. Thanks for the kiss!
Love,
Dad

It must be a “carry-over” from years of business. I just hate to do things that I view as wasteing my time. Things like standing in line at a fast food restaurant is annoying. Long lines at the bank or waiting for the dreaded renewal of my drivers license all are designed to make me angry.
Well this morning I went to my local “Big B” auto dealership to get my oil changed. In an effort to keep my Saab in good operating condition I change oil every 5,000 miles which is much less than the advertised 10,000 needed for change. Waiting 10 minutes for the “service door” to open to just get my car to the check-in counter should have been a clue. I kept my instructions clear, “just oil and filter”. I signed a slip that I authorized anything up to $65.
So I was off to my seat in the customer service area. Sitting next to me was a slick salesman for drugs and medical supplies in the area. He had on an earpiece that allowed him to talk to clients without holding his cell phone. The little shit spent 40-45 minutes trying to impress secretaries, nurses and doctors with his spellbinding sales pitch. Meanwhile I was trying to watch the “View”. I mean it is important for me to listen to those liberal left wing sweethearts. You get the point. Listen to the salesmen or the View. I was in hell.
‘When I was a kid I would change the oil on my cars. You have to uscrew a filter, let the oil drain, screw in a new filter and dump in 4-5 quarts of oil. 10 minutes top! It is not rocket science.
After about 45 minutes, the service manager comes in and says my tires should be rotated. This is a ploy to get me to spend more money. Un-beknownst to the manager, I had my snow tires taken off yesterday and we strategically placed all the tires in the right places on the car based on wear. I did not need to rotate tires and spend another $60. They’re not playing with any dummy here! No rotation.
Then after about 1 hour and 15 minutes they announced my car was done. My expectations were about $25. The bill came to $61. You are kidding! Nope. The oil was $35, filter $10 and labor $15 plus tax. To be fair, I got free burnt coffee and they did run my can though some sort of automatic car wash.
General Motors wonders why it is in trouble? Yes it is drowning in a sea of promised benefits to workers. Yes it has many inefficiencies. Yes it has missed the boat on cars that are fuel efficient not to mention lack of innovative design. But did it ever think about giving a customer what he/she wants? Quality products at a fair price and service that is customer oriented.
I happen to own a Toyota Camry. I can drive to the dealership without making an appointment for an oil change. I am promised I will get my can back in less that 30 minutes and the bill is never more than $25. I get free soda and coffee. Car washes are random depending on how busy they are. Toyota knows their customers. I still hate wating for an oil change but Toyota minimizes the pain. The last time I looked Toyota was making big money.
Well one good thing did happen. I had my blog to vent on! I feel better. Now I need to look forward to my next battle with General Motors. I can hardly wait.
Love,
Dad

I have come to the conclusion that most people know nothing about “saving”. I have made the assumption that it is axiomatic that the concept of savings is understood by everyone. I’m finding that is not true.
Saving is a required for financial success. It means the discipline to put money aside for your future.
Savings should become a habit. Setting money aside on a regular basis is the engine for accumulating wealth. You can’t invest until you’ve saved some money.
Savings should remain essentially untouched. If you tap into your savings account it should be for something that you’ve planned for or possibly for an emergency. Some people have a goal of a larger home. Sometimes emergencies occur and when your basement is flooding with water, you don’t quibble with the plumber about how much he charges. There are legitimate uses of savings.
You can save regardless of your level of income. You can always set money aside, even if it is $5 per week.
Saving never stops. It is like breathing. Pay yourself first. Who is the most important person in your life? The answer is “you are”.
Saving can be an account at your local bank, credit union, or savings & loan. Saving can be a 401(k) at work where you authorize putting your pre-tax earnings into a deferred account. Saving can be the equity in your home that builds up after years of paying off the principal while simultaneously your home is growing in value.
Saving is usually slow. It can be weekly, semi-monthly or monthly or annually. It comes with discipline.
Savings give you choices. If you have money in the bank, you can choose alternate services or products. Your are in control. Money gives you access to lawyers (when necessary), doctors of choice and decisions on where you want to live your life.
The way to grow your personal savings account is to spend less or earn more. Earning more allows more dollars to be set aside and as your income grows, the amount of money set aside should grow. As your careers progress, you should be able to accumulate more.
Save people. It is important. It is necessay. It should become a way of life.
SAVE, SAVE, SAVE. Why is the concept so hard?
Love,
Dad

Maintaining medical insurance coverage has been a saga. Primary insurance through Medicare, supplemental insurance through another company and additional insurance for drugs. Then there is dental insurance (which we don’t have). Eye visions costs are not in the insurance. What have I missed? You get the idea, medical coverage is expensive and complicated.
So I wonder, how did things get so complicated? Growing up in Plymouth, our family doctor was Dr. Dietsch. He was kind of gruff but very caring. He knew most of the families personally and his motivation was not money.
Dr. Dietsch had an office in the building “kitty corner” from the City Club. You could not schedule an appointment with Dietsch. He posted the hours that he would be in the office and you would sit in the waiting room until it was your turn. Sometimes you could walk into the office and he could see you immediately. Sometimes people would be standing in the second floor hallway waiting to get into the “waiting room”. No exceptions. You waited your turn.
Dr. Dietsch had a side entrance to his office and sometimes while you were waiting, he would sneak out to have a sandwich at the City Club or to run an errand. So it would get frustrating as you sat in the waiting room anticipating your turn and he wasn’t even in the office. Living downtown like we did, we knew where his car was parked and we knew of the places he might go if he snuck out. So we planned our visits knowing his “where-abouts”.
Dr. Dietsch hardly ever wrote things down. I remember that a penicillin shot was $2.00. If you didn’t have the cash to pay, he supposedly wrote down the amount and would bill you later. He never billed later.
Dr. Dietsch would make house calls. If you were sick in bed, he’d swing by, treat you and be on his way. What doctor makes house calls today?
Dr. Dietsch was the family doctor for both the Andrews family and the Steger family. So when mom was expecting Debs in 1960, Dr. Dietsch was the physician of record (I think Dr. Steffan actually performed the delivery because Dietsch was out of town). I remember the doctor bill for her birth being $75. Compare that to today. I think today a doctors care for a pregnancy is over $3,000. Kelly’s delivery was also under the care of Dietsch.
Somehow we’ve evolved into a world of specialists, expensive testing machines and medications. I guess we’ve improved as attested by the age that people live. The average age of men and women today is over 80. Back in the 60’s it was around 65. So we are living longer because of medical improvements.
I miss Dr. Dietsch. He was part of the “community family” and you knew he cared. He wasn’t driven by the money and he treated people the same, young and old, rich or poor.
Alas, I have adapted to the new world of medicine. It is cold. You are a number. You will get treated when the doctors are ready. Have your insurance card ready. Hope you don’t run into a financial disaster.
Somewhere up above, Dr. Dietsch is looking down and shaking his head in disbelief. I shake my head in disbelief.
Maybe I’m just getting old!
Love,
Dad

Retirement accounts have ungone fundamental changes over the last 25 years. Historically companies promised a pension to long time loyal employees. Unfortunately there have been too many company failures and employees have lost their pension plans.
The popular vehicle of choice, is the 401(k) plan. It allows you to set aside pre-tax dollars of your own until you retire and most companies participate by matching your contribution. Companies are required to place the money in a trust which means that if the company should fail, your money is protected.
Each company allows you to invest money within your 401(k) in different ways with different degrees of risk.
The money coming from your paycheck is 100% yours and vested immediately. The company contributions usually aren’t totally vested until after 5 years.
If you leave a company (i.e. move on), the 401(k) belongs to you. Every company must write a master plan that determines how your 401(k) plan is handled should you leave. Some companies will allow you to remain in their
401(k) plan even after you leave but no further contributions can be made to the plan. Why would you remain in an old plan? Usually because your money has been invested in really good options and you are happy to leave it where it is. Most companies force you to move your 401(k) somewhere else because they don’t want to have any administrative fees in managing your money. So plan on having to move your 401(k).
The best option is to move your 401(k) to an IRA (Individual Retirement Account) administered by a bank, brokerage or mutual fund family. You can transfer without every taking posession of the money. If you take the money from the 401(k) yourself and transfer it to an IRA, you have 60 days to complete the transaction. Don’t do that! If you fail to get the money transfered properly in 60 days, you pay a 10% penalty to Uncle Same and you pay all federal and state taxes on the total sum. Once your money is transfered to an IRA, you decide how the money is invested. Some people are not comfortable making investment decisions for their IRA but there are some real simple options. Contact your free financial advisor to get some ideas.
Another option is to roll your 401(k) of the “old” company into the 401(k) plan of the “new” company. Some companies allow this option, some do not. Again the reason for rolling the money into a new company plan is they give you investment options that you perceive as really good and you feel comfortable doing it.
Every situation is different Grasshoppers but the Queen of Wisconsin Vision and the Princess of Minneapolis Web Designs both face decisions.
Unless there were truly exceptionally difficult personal situations, the option of cashing out the money should be avoided. My personal choice is a rollover to an IRA run by a reputable mutual fund company.
It is your money. You worked hard for it. Don’t lose control of it.
Love,
Dad

I have had several requests to blog about selling a house. Boring! But wait, Kelly just sold her home, Chris and Shelby unsuccessfully tried to sell their house and Debs is thinking about selling her place. Paul is on a five year plan to move up to a house with more amenities. And Margaret? Who knows but I would bet a dwelling is in her future. So here goes. My intent is to just “frame” the sales real estate transaction. You can get “Real Estate for Dummies” to tell you how to go about the sale.
First, it is your house. You get to decide the parameters of the sale.
Second, it is probably your biggest asset and it is important that you realize the maximum return from it’s sale.
Third, it is your money! You decide how it is managed.
I am not going to deal with selling a house yourself. Kelly did it in a good Madison market but it takes research and special efforts. The payoff is that you save 6% commission. The risk is that you don’t price it properly so you lose potential sales dollars or you make costly financial mistakes. And then there are the potential legal entanglements that could arise from selling yourself.
Most people sell through a real estate broker. Appleton is dominated by Coldwell Banker and Sheboygan is ShoreWest. When you sell through a real estate broker you sign a legal document giving them the right to represent you in the sales/marketing effort and such things as a 6% sales commission (which is negotiable) and the length of time they represent you. Usually they want a contract for 6-12 months. I prefer 120 days because it creates urgency on their part. You can always renew.
A licensed real estate agent is obligated by law to represent your interests. That means they work for you and if they compromise that representation in any way, you can sue them. They should do what you want.
The real estate agent is a licensed professional hired to perform sales/marketing functions as it relates to your home. Generally they bear all the costs associated with advertising and marketing efforts. The term professional is important because they should be above reproach on integrity. Now that you are done laughing, we will proceed.
You should get at least two and possibly three quotations on the sale of your house. A professional will do comparative sales analysis, examine recent sales in your area and make recommendations about the salient features of your home. The highest price projection may just be a sales ploy to get you to sign a contract hoping that you will accept lesser offers. My rule of thumb is to get a fair price for your property and then move on with your life. If you hold out for an exhorbant price, you might be waiting a long time. Use common sense.
Lastly, you will sign several legal documents that determine all conditions of sale. They hold up in court. Verbal commitments mean nothing. Understand everything in writing. Get everything in writing. A good real estate professional will insist on everything in writing. Read the “sales listing agreement” with the agent very carefully to be sure it is what you want. When someone decides to make an offer to buy your house, they will fill out a “offer to purchase” contract. Read it very carefully before signing it. You will be bound to it when your house sells. I have always used a lawyer to draft my offers to purchase a property (even with my real estate brokers license). I have also have used a lawyer to review someone’s offer to purchase a property from me. The legal documents are key to the sale. Sometimes, lawyers can save you money.
Of course you have to deal with the inconvenience of vacating your home for showings, open houses and quickly arranged “walk throughs”. Are we having fun yet? And oh yeah, a real estate agent will tell you the things that you should do to improve the appeal of your home. Things like paint, furniture arrangements or upgrades of things that are important to buyers. You decide what you will do but I’d suggest you listen to the real estate agent. Selling is what they do!
Then you sell your house. You take the huge profit that is left after paying off your mortgage loan and apply it to the purchase of a bigger house and you wait on average 5-7 years to do this exercise again.
Love,
Dad