Ace Wisdom

It struck me the other day that my esoteric (look it up) ramblings about money, earnings, debt, and budgets were falling on deaf ears. Yawn!
But then the other day one of you Grasshoppers made reference to people viewing themselves as “money machines”. Huh? Yeah, each person works hard every day to earn cash and you get paid every week, every two weeks or monthly. That cash you get makes you a money machine. You have cash to spend on what ever you want. After all, you earned it.
No one has any idea of how long the money machine will spit out hundred dollar bills but hey, for right now, keep it coming. So you take your cash and pay mortgages (or rent), car payments, boat payments (boat payments?), utilities, medical bills and kids shoes. Suddenly your cash machine is being stressed. There is no more cash until the next payday. What if it breaks down? What if there isn’t enought?
I’ve touched on budgeting and planning subjects in the past and you can go back and re-read some of the entries. My message for today is that you own your own money machine. Hell, you are the money machine. If follows that as the money comes out, YOU SHOULD PAY YOURSELF FIRST.
Pay yourself first takes many forms including contributions to your retirement accounts such as 401ks and pension plans. Actually, the dedections from you checks for Social Security are going into the government abyss that hopefully will provide future income. A regular deposit to a savings account is paying yourself first.
When I say pay yourself first, I mean put cash in your pocket every payday. You are your own cash machine. Who is most entitled to the cash. YOU ARE! I know it is a simplistic concept but you can budget cash payments to yourself. The cash can be used for anything you choose. You don’t have to explain it’s purpose to anyone. If you want a Starbucks latte with whipped cream, live it up. If you want that copy of “Cosmopolitan”, go for it. If you want to take your loved one out to a movie (afternoon prices are reduced), have a ball. If you want to get “smashed” at the local bar, it is your choice. When it is gone, it is gone and you have to wait until the money machine kicks out more cash next week.
Your mother and I have both been paid cash on EVERY payday. Reality is that sometimes it gets spent on necessities like golf balls, outboard motor oil and camera lens. But, just having the discretionary cash is a good feeling. It represents a tangible, visual positive outcome of all the long hours spent earning the cash. In Milwaukee in the 60’s, your mom and I got $5 per week. Hers went to bowling and mine went to golf. To be fair, $5 in the 60’s is probably like $25 per week now. We have increased the amounts slightly over the years but we do indulge ourselves with “piddling away money”. I used to call it F.U. (i.e fun use) money. It is mine. I can do what I want with it. I don’t have to explain it use to anyone.
If looking at yourself as a “money machine” brings perspective to managing your money, go for it. Regardless of how you manage your money, you can find cash to PAY YOURSELF FIRST.
Love,
Dad

It is September, 1977 and your Mom and I had just purchased our first cottage. Included in the sale was a small row boat that had a two horsepower Evinrude engine. It wasn’t designed to pull water skiers but it was easier than rowing. It was clear to me that if you wanted the full “lake experience”, we needed a bigger, faster boat. With the onset of winter, a different boat wasn’t a burning issue.
We now move forward to the Spring of 1978. I had limited knowledge of boats and outboard engines so I was determined to find a used “rig”. I kept watching the classifieds and I remember an ad for a poweri boat that had a Mercury engine and a trailer for about $1600.
Late one warm April afternoon, Christopher and I went out to Sheboygan Falls to look at the boat. It was kind of cute. It was red in color with a black 65 hp Mercury engine. It was mounted on a narrow trailer that seemed in pretty good shape. We bought it on the spot and I remember paying $1400 cash. If my memory serves me right, I had the foresight to have a trailer hitch mounted on our car earlier in the month so we could tow it.
Chris says the boat was a Mercer. What the hell is a Mercer? I know there are Glastrons and hundreds of prestigious names in boats but I had never heard of a Mercer. If memory serves me right, there is a town in Wisconsin named Mercer and one company built boats. Of course they were called the Mercers. Dah! Ah, the creative genius of Wisconsites.
Our little red Mercer was a good first purchase. We knew nothing about boats and we could make mistakes with little financial risk. It turns out the back of the boat where the engine was mounted had been damaged. Neither Chris or I noticed the cracks in the transom and they would become a problem. The 65 hp Mercury engine turned out to be worth every penny we paid.
That little boat was tough. It sank in a storm along side our pier. We had to repair the back transom as the cracks got bigger. Our neighbor on 6th street, Ken Hansom helped to reinforce the motor mounting plates and rebuild the back with fiberglass gel. It was stronger than ever but it was a “scarred craft”.
By the time we bought the goldflecked Glastron, we had a lot more experience in boats and we transferred the 65 hp engine to the Glastron. It turns out the combination of the new boat and the 65 hp engine was a special combination. It was balanced and trimmed out to go about 55 mph. Whoa! That was a long way from our first 2 hp Evenrude.
But who could forget our first little red boat. It was priced right. It was tough. It never failed us. It was the little red boat that could! When we traded the red boat, I asked what the trade value was. I can still hear the laughter of the salesman. Would you believe “0”. For months after trading it, you could see it sitting on a pile of junk in back of the boat dealership. The boat will always hold a special place in my heart.
Your mom says we should have dug a hole in our back yard to place the boat in. Then if we filled it with sand, we would have had the sexiest sandbox in the neighborhood. It would have been a neat idea.
May the little red boat rest in peace!
Love,
Dad

When I was a young boy growing up in Plymouth, dreams of doing it for the first time was intriguing. The problem was getting up the courage to try it.
They say anticipation makes the heart grow fonder. Well I had thought about doing it for months. The summer of 1953 was going to be indelibly etched into my memory.
My biggest fear was failure. What if my expectations weren’t met? It could be devestating.
I would ride out to Crystal Lake several times per week to attend swimming lessons at the Crystal Isle Inn. The yellow school bus was always filled. I do remember Jenna Lujack, a bronzed blond classmate, was always on the bus and boys swarmed around her likes bees to honey. Of course the bright red, or yellow, or polka dot bikini’s didn’t hurt. It was on one of the rides that I decided today would be the day to do it.
The first thing I needed to do was skip out of formal swimming lessons. Besides, there was no way I could do it for the first time during lessons.
My goal was to get to deep water and the cement raft with the diving board and high tower. That seemed to be where all the fun was. The girls were always screaming. Some people spent the whole afternoon getting a sun tan on the raft. Yes sir, the raft was where all the action was.
So after sneaking out of the dressing rooms, it was pretty easy to avoid all the swimming classes and I made my way towards deep water on my way to the raft. The problem was, I couldn’t swim and I reached a point where my feet were just touching bottom. The raft was still 20 yards away.
Thats right Grasshoppers, my goal was for the first time, swim out to the raft where all the “big boys and girls” had all the fun. It meant taking a risk without supervision and swimming the magic 20 yards. My buddy Charlie Gertz had done it the day before and of course he said “anybody can do it”. In hindsight, the risk was small because I could swim on top of water or under water long distances but I always had the safe feeling of being able to put my feet down if I got tired.
So when no one was watching, I pushed off towards the raft in a slow crawl and what do you know, I suddently was at the raft and climbing up on top. That wasn’t so bad. In fact just to prove it, I dove into the water headed back to shore and repeatedly returned to the raft. I had done it for the first time. You never forget your first time.
By the end of the afternoon, I was jumping off the tower and playfully swimming back to the raft. It was easy and my confidence soared. My summers would never be the same. No more boring swimming lessons. Just the raft with it’s social life baby!
It is interesting that with some of my childhood history invested in Crystal Lake that we bought a several cottages on Crystal in later years. I will say that I knew the lake and maybe some of the early experiences influenced our decision.
So you see Grasshoppers, there are many firsts in life and some seem scary. Each time you conquer the fear, you grow a little. There is always a new challenge. There is usually a satisfying reward. So if you feel yourself becoming afraid of something, many times if you push through the fear you’ll enjoy the rush! Go for it.
A word of caution. Don’t swim alone. It is stupid! What was I thinking?
Love,
Dad

Grandma Alice was pulled into the mystique of the City Club by my dad Bucky during the early 1940’s. My brothers and sister were born during that time. Bucky’s dad (Chalk) died in 1946 and a soap opera began. Bucky’s mom, Myrna married a “dead beat” in the late 1940’s. Bucky and Bob got involved the the business of the City Club in the late 1940’s and early 50’s. The “dead beat” piddled away the assets of the City Club and Myrna ended up broke. Alice got to watch the whole thing from our upstairs apartment.
Alice’s dream was to get out of the City Club after my dad died. It was literally sucking the life out of her. So when Ray Torke came along, it was a ticket out. They bought the farm on the hill on Hightway 23. Alice had become a very, very strong individual by this time and Raymond wasn’t exactly a nurturing mate.
So for the next 20 years Grandma Alice lived on the farm. You Grasshoppers got to experience Saturday morning breakfasts with Alice.
Grandchildren were always special. They got treated very well on the farm. Your cousin Valerie, Debs, and cousin Mary Alice seemed to warrant special attention but I don’t think any Grandchild felt left out.
Breakfast with Alice was a “happening”. There was lots of bacon and eggs. The bacon was fried at very low heat so that it didn’t burn and eggs were fried in butter. You never got what you ordered. If you wanted one egg, you probably got two or three and eventually would be offered more. One piece of bacon meant 4-5 pieces. The German Hospitality Creed was in effect! Stuff your guests! All of this made for a memorable experience.
For years my brother Jerry lived on the farm while working at Kohler. Sometimes he would join us for breakfast. My brother Jack sometimes would show up for the gathering. Ray Torke would come in from from feeding the sheep to eat and usually the conversation turned stupid or he would go off on a non-sensical rant.
Preparing breakfast was work for Grandma Alice. As time went on, her diabetes kept getting worse and of course her smoking habit caused breathing and coughing problems. So the Saturdays got more difficult and I know there were times she really didn’t want to see anyone.
I do remember rooms filled with smoke. Alice smoked. Jerry Lee smoked. Jack smoked. It got the the point where it wasn’t as much fun but the breakfast made it worth while.
I also remember helping Alice with her diabetes. She had to prick a finger and immerse litmus paper in the blood. Dependent on the color of the litmus paper, it determined the amount of insulin she would have to take to stabilize her “system”. We would argue about the shades of pink and blue in the litmus.
Alice deserved better in life. Her struggles embittered her. My dad died leaving her with tremendous responsibility. She did what she had to do. She survived.
By the time grandchildren began to arrive, Alice was a different person than I remember growing up. The softness was gone and the family I had known would never be the same.
But who could forget breakfast with Grandma Alice? My guess is that every Grandchild has a special memory. It was a special time.
Love,
Dad

I am not a computer geek. I know that I appear resistant to change. I am however, aware of things going on around me and every now and then, someone or something tweeks my interest.
Mark Cuban is a self-made billionarire. At last tabulation, he was worth $1.8 billion and the 164th richest American. He dresses sloppy. He loves sports. He appears to be a non-conformist but I suspect he is steeped in traditional values.
Mark and a buddy started Broadcast.com which is an online computer gateway to broadcasts of college and professional athletic events around the world. So here is a man in his 30’s developing software systems that bring him things he loves, namely sports. Did I mention he owned a sports pub while going to college? At the height of the frenzy for computer software and equipment in the late 90’s, Mark sold Broadcast.com to a little company called Yahoo. He suddenly had $1.9 billion in cash and he was still in his 30’s. What guy wouldn’t like to be in Cuban’s situation.
So what does he do with all the money at a young age? Most of it is in cash. He draws interest on the cash but he isn’t stupid. He is not going to risk being poor again.
Then he buys things that make him comfortable. He owns a 24,000 square foot mansion in Dallas. He flies a $41 million dollar Gulfstream jet that takes him where ever he wants to go. He drives a yellow Hummer, a 2001 Explorer and has 2-3 Lexus cars are trucks.
Oh yeah, for business entertainment he bought the Dallas Maverick basketball team. He spoils all his NBA players by providing exquisite locker room amenities including individual TV’s by every locker and high-tech sound systems so that players can relax before all games. He screams at the referees and generally shakes up the whole NBA establishment. In other words, he has some fun with the billions. He claims he is losing money with the Mavericks but I would seriously doubt that. He paid $280 million for the the Mavericks and it is probably worth double that amount. I guess it depends on how you define, “losing money”.
He did marry in recent years. It is the only move he made to taint my image of him as a role model. Just Kidding! Ha-ha-ha.
If you ask Mark if he was lucky he will respond by saying “hell yes”.
I do want to share his business philosophy because he is rather candid and blunt. The measure of business success is getting rich. If you are rich, you are successful. His goal was to put competition out of business. Money is the ultimate scorecard. If you are in an industry and you are getting the money and your competitors are not, you win! Marks role model was Andrew Carnegie who believed “it is patriotic to get rich”. There is a distinct lack of mention of human compassion in any of Mark’s philosophy.
Now we come back to reality. Money does not buy happiness but it is fun to live vicariously by watching a pub owning entrepreneur bounce through life.
So Grasshoppers, there is always hope. You too might just get lucky. I suspect that each of you may be richer in some ways than Mark Cuban. You do not need billions to be happy.
I guess I’m just jealous. I always wanted to be able to sit on my ass and do nothing but spend money and have fun.
It is the American dream.
Love,
Dad

Federal Imcome Taxes are coming due. You need to file by April 15, 2006 your statement of imcome for 2005. Your employer insists that you claim a specific number of dependents at the beginning of the year and then deducts federal income tax from every paycheck. If you are lucky, the deductions taken from your check will total your calculated annual tax obligation and you with neither owe any money or be due any money at the end of the year. Yeah, right!
Trying to estimate a tax obligation a full year in advance is the “impossible guess”! How could you possibly know what is going to happen during the year. Maybe you will have high medical expenses or alternative minimum tax will kick in or you will lose your job or your property tax bill will sky-rocket. Uncertainty, uncertainty, more uncertainty.
From a pure financial standpoint, owing federal tax at the end of the year is the best scenerio. That means you get to hang on to your money longer and keep it working for you until you have to settle with the IRS. I think the rule is that you must prepay 90% of the current year obligation to avoid any penalty. Most people do not like to owe year end taxes because there is a negative stigma that goes with having to write a check to settle up.
From an emotional standpoint, most people pay too much federal income tax from their paychecks hoping that they will get a refund at the end of the year and then they can buy that TV, camera lens, or take a trip. Receiving the windfall is positive and buoys the spirit. It is a lousy financial management to receive a large refund but receiving hunks of cash are euphoric.
In truth, a couple hundred bucks one way or the other for year end tax obligation is not a big deal. If you receive refunds of several thousand dollars, you are not managing your money well.
Here is my message for the day! Don’t pay to receive a refund early. Many people find out they are getting a “windfall” refund and then if they pay the tax preparer a fee, they can get money immediately (after the tax preparer subtracts his/her fee). Usually those fees are exorbitant. It is not uncommon to get charged $30-40 for the ability to get $300 cash refund immediately. That is 10% of the total and probably calculates to be 100-300% annual interest charge. That is ridiculous. Most refunds take 3-4 weeks. You waited 12 months (a full tax year) and then several months to file your federal taxes, why do you need an immediate refund. I call the immediate refund “extortion money”. If your refund is needed imediately, you probably have bigger money problems.
Do not pay the fee for the privledge of getting you federal tax refund immediately. In most cases it is some high powered loan company ripping you off.
Love,
Dad

No, I’m not talking about “lines” in your face or any other part of your anatamy!
Nor am I talking about “pick-up” lines when you are/were dating.
Isn’t there a song that has to do with love-making in a car? Something about “passion by the dashboard lights”. It is where the guy promises to love his date in the morning and his “line” is “absolutely he will”. Of course that is a crock. That is not the kind of line I’m talking about.
Prince Charles is in “line” to the British throne. He is 60 years old, but his Queen mother is in her early eighties with a genetic lineage that will take her to over 100. Charles can be in line for his whole life waiting to receive his birthright and die never achieving the promise. That is not the line I’m talking about.
Green Bay Packer fans can sign up and get “in line” so to speak for season tickets. At the rate people die or surrender their tickets, you might achieve elgibility for tickets in 50-60 years. That is not the line that is the object of this blog.
It is not the 30 years waiting to get tickets to the Master’s Annual Golf Tournament.
It is not the “lines” at the DMV. At least there you get a number and everyone is treated the same. It only takes you two hours to get the lousiest picture on your drivers license that you could ever conceive.
It is not chosing the wrong line at the local bank. My “line” at the bank is always the wrong one. The other lines move and I’m still sitting there.
No sir, my cynicism regarding “lines” is directed to to checkout “lines” in the grocery store. I usually stop to pick up several items that take less than a minute to checkout. Somehow, I always get behind a person (usually female) that makes a career out of “checking out”. First, she fumbles in her wallet for a discount card. It is usually in some hidden pocket. Then she has picked an item (among many) that either doesn’t have a price or the computer doesn’t recognize. Then the phone call for a person to check the price. The line doesn’t move during this process because the computerized register is full of information and it must get the addition info to procede. When entering prices begins again, you think the line will finally move. Nope. Out come the coupons which need to be swiped individually. There is one coupon that doesn’t “compute” slowing down the process. Finally, a grocery total comes and the lady asks if they will take a check. After much fumbling, she finds her checkbook. She asks if she can make it out for $20 over the grocery total and then proceeds to fill out the check and her checkbook register. The computer needs to check her credit and okay the check. Finally, the lady puts all of the stuff back in her purse (unused coupons, checkbook, store specific discount cards, etc.). If the chit-chat has stopped, the line moves. I have ignored the lines that require under 15 items and people have 30-40. I have ignored “self-pack” stores where packing begins after all the check-out shinanagans. I have ignored the “welfare stamp” routines. I have ignored the cashier running out of quarters and leaving the register to get necessary funds. I just scratched the surface.
And then I whip out my store specific discount card, have cash ready in my hand and check through the 4-5 items I needed and I’m out in 60 seconds. Why can’t the world be more like me?
We are all victims of “lines”. They clutter our lives. We could be painting the ceilling on some magnificent chappel. We could be inventing a Salk polio vaccine. Or we could be doing genetic research to find the cure for cancer. But no, we are wasting away in some grocery store line.
I realize I need to let go and relax. Hey I do feel better! I think I can survive my next “line”. I hope you can too.
Have a good day.
Love
Dad