Here is the article in its entirety.

When I first started writing The Simple Dollar, one of the biggest struggles I had was figuring out how to redefine some of my friendships – a struggle I discussed at length.The problem was that a good number of the people I spent lots of time with were constantly engaged in activities that involved spending a lot of money. Constant golf trips, constant traveling to gaming tournaments, constant shopping for music and electronics – these were simply the things that we did.

Eventually, I came to realize that for some of the friends, these expensive activities were the sole basis for our friendships. Without the weekend golf outings or gaming tournament trips, several of my friends simply vanished into thin air. Other friends, of course, were (and still are) quite happy to do other things not necessarily based on expensive activities or shopping excursions.

In fact, one of our biggest social highlights now is inviting friends over to play board games in the evening – games like Ticket to Ride and Puerto Rico and Power Grid. An evening with dinner, a glass or two of wine, a few small snacks, a thought-provoking game, and some great conversation is a spectacular way to spend time.

Even further, I’ve found that engaging in frugal activities in my community – such as participating in service groups, attending community events, and so forth – has connected me to many new friends with whom I share a lot in common.

Some of you may be asking yourselves, “I have no interest in dumping my friends in order to get ahead financially!” And you shouldn’t! Friendships aren’t things that should be tried on and discarded on a whim like so many blouses on a discount rack.

Instead, a truly worthwhile friendship grows and changes with you. If your interests change – if who you are and what you value begins to change – then your friendship will either gradually grow with you or it will melt away, replaced by new friends.

I often look at friendships as falling into two classes:

One, you have friends that you associate with primarily because of shared interests. When I played Magic: the Gathering, I had friends who also played, and that was our primary touchstone of friendship. The same holds true for many things: location (the neighbors that you invite over for barbecues on occasion, but wouldn’t keep in touch with if either of you moved), employment, and so on.

These friends are wonderful to have, but their friendship is limited to the external things you have in common. As those things begin to change, your friendship will go away.

Two, you have friends that you associate with primarily because you care about one another. These friendships often begin with a shared interest, but then they grow into something more: a genuine interest in and caring for each other.

Take, for example, my closest friend, John. Our friendship began thirteen years ago simply because we lived on the same dormitory floor. Later, we found we had common interests in gaming (to an extent), but over time, it developed into a true friendship that has lived through many moves, career changes, interest changes, and so forth.

Why does the friendship persist? We care about each other. Not only am I concerned about his well-being (and he about mine), that caring extends to pretty much any aspect of each other’s lives that we’re willing to or wish to talk about. If John has a new interest, I’ll want to learn about it. If he has a problem, I’ll do my best to help him through it.

The problem comes in when people believe that the first type of relationship is actually the second type. They’ll keep working hard to maintain a friendship, even though the basis for that friendship is slipping away. They’ll keep going out for expensive golfing excursions, even though the cost is one that now makes them feel guilty and keeps them up at night. They’ll keep going clothes shopping, even though they’re trying to cut down that wardrobe.

In the end, the lesson is simple: don’t be afraid to lose friends if you change interests, passions, or activities. True friends will stick with you no matter what you choose, and when you do make that switch, you’ll find new friends that share your new passions.

The biggest stumbling block for this is that we all fear change. It’s easy to imagine losing the friends – it’s harder to imagine gaining new ones. Thus, we imagine ourselves lonely and empty and thus we keep engaging in things that don’t make us happy in order to stave it off.

Don’t be afraid of the right kind of change. Follow your heart – your true friends will follow, too, and you’ll find new ones along the way.

My employer has a mechanic who works full time, so we called him to get some advice. He asked us to do all the things we had already tried and still no luck. He then decided to come over himself and take a look at it. That didn’t accomplish anything. He even did something with WD-40 that I really don’t understand but it didn’t work so it doesn’t matter. Then he went and got a new key because maybe the key was too old. Maybe. That didn’t work either.

By this time my wife is real irritated. She has had nothing but problems with her Saturn since she got it and I was worried this was the last straw. She had been driving it for over a year with no instrument panel. By this, I don’t mean it was gone, it just didn’t work. It was real scary not knowing how fast we were going nor how much gas was in the car. We let it slide because she only drove the wagon in town and if anything happened, I was really close by and could come get her. Also, we didn’t really want to keep sinking money into something that was never right in the first place. She did run out of gas at least once but that was the extent of it. This was different. We couldn’t even get the car to start.

We replaced some engine parts on the car about a year ago to the tune of almost $1000 and this problem was looking pretty expensive too. Mostly because we didn’t know what was wrong and figured it would cost to have someone figure it out. Because my son was coming to live with us and we already had the baby and all her stuff piled into the wagon, we decided to just look and see what are options were on replacing the car completely. We really needed the extra room and the kids weren’t getting any smaller.

We had some money left over from our tax return sitting in the bank ‘just in case’ that I was going to use to pay a big chunk on my student loan (if they decided to settle) but I kept putting it off for whatever reason and they never answered my settlement inquiry. So I made that money represent my max car amount. I didn’t expect to find anything decent in that range but I sure wasn’t going to get another car loan. I was hoping to spend a couple thousand on a car that would get us by until we could save for a van. So my search began. Maybe I could find a cheap van while searching for a car?

Living in a small town like we do, there isn’t much opportunity to find vehicles for sale like you would in a big city while avoiding a dealership. I looked up our zip code online and was directed to dealers in the big city two hours away. Then I decided to pick up the little Classified Weeklies that are put out, hoping to get lucky. As I was flipping through the newsprint, getting more discouraged, I saw some rays of hope. There was a small section of vans and there were a few that looked pretty decent. A couple had a lot of miles, but I circled them anyways. After all, beggars can’t be choosers. Then I saw something that struck me as odd. There was a 2004 Chevy Venture for sale that only had 84,000 miles on it. This was far and away the lowest mileage of any of the vehicles I had looked at. The price was a little higher than I wanted to spend, but maybe there was hope.

With my nature, I didn’t want to wait to see if the van was for sale, so I called the number listed in the ad while I was at work. An older sounding man answered the phone and I asked him about the van and whether or not it was for sale still. He said yes and if I wanted to see it, the key was at a vet’s office in the next town over, a friend of his. The drive to the next town was only about 25 minutes away, so I called my wife and told her that I would go with my son to check the van out that afternoon. Maybe I got lucky?

Once we arrived where the van was parked, I was shocked at how clean it looked. I wasn’t expecting a junk pile, but I wasn’t expecting to see such a clean vehicle. I went in and got the key from the vet and took the van for a spin. As we got about two miles up the road, we decided to pull over and check the van out while it was running. Everything was checked, as best as we could, we really didn’t know what to look for besides leaks and wear. Satisfied with not finding anything, we took the van back, with about five minutes to spare before the vet closed.

I was satisified. We really wanted a van more than another car because of the extra space, but what about the price? I had learned while buying our house that there really is no way to ask for a lower price, you just have to get confident and do it. So I looked up the car on Kelly Blue Book, got what it was really worth in its condition and called the owner back. I offered him KBB value for a private seller and he said I would have to do better than that. So I asked him what would he take for it, lowest price. He said that he would have loved to get retail value but he would take $500 over my original asking price for it. I checked my emotions and told him I would have to get back to him after consulting my wife.

I looked up everything I could about the van and asked anyone I knew of what they thought about the deal. I then asked my wife if she was ok with the asking price. After consultation from all my counsel of friends and after thinking about the deal myself overnight, we decided to purchase the van. We went and picked it up the very next day after I drove it and couldn’t have been more pleased. We didn’t get a new car, nor one with all the bells and whistles, but we did get one that I feel safe that my family drives and rides in and for a price that I thought was fair.

And we did it all in three days. With cash. What a feeling.

• Our grocery budget will definitely be affected. My son eats constantly so this will be a hard thing to gauge for a while.
• Clothing budget. My wife and I don’t really buy new clothes, or clothes at all, except for a few times a year. How many times will we have to buy my son clothes or shoes and what’s a good budget for this?
• Allowance. My daughter isn’t old enough yet to get chore money, but my son definitely is. What is a good allowance rate? My brother in law pays his kids based on their ages and I think this sounds like a good idea.
• Travel Expenses. This is one part of the budget that will go down probably to zero. With my son living with us, we won’t be buying plane tickets every month. That might offset the grocery changes he will bring.

What else should I look forward to changing significantly in my budget? I hope there isn’t too much that I am not thinking of. I am pretty stressed out about the situation. There is so much to think about and I don’t want to forget anything.

That’s where every financial transaction involving a family member goes sour.

Fast forward about six years or so. My family and I are doing pretty well financially. We have set up a budget so that my wife can stay home with our newborn daughter, I have a fund to fly my son, who lives in West Virginia, to visit us almost every month. We are following Dave Ramsey’s plan of attack and have gotten a stranglehold on our debts and have actually just purchased our first home. My family and I have made a lot of sacrifices to put ourselves in the position we are in financially and we are happy with the progress we have made, but we know the fight isn’t over. All we have left as far as debt are some medical bills, my student loans and our mortgage. Oh, and that family gift that I didn’t know was a loan.

What!?

Yes, now that my family thinks I’m “rich”, they want that money back. It’s not that I wasn’t planning on repaying them at some point, we knew we would eventually be able to do it. However, it wasn’t something in the immediate plans. The problem is this: every time we talked to that family member, or someone closely related to that family member, we heard about the money. Not in direct ways though, just roundabout annoying ways. Like how hard-up this family member is (even though they take at least four out of town trips a month knowing they can’t really afford it) and how much that money would really help them out. I have tried to introduce this family member to Dave Ramsey and how budgeting has helped our lives so much, only after they asked for the information, but unfortunately the plan for getting out of debt and handling money with common sense hasn’t been as important to them as it has to my family and I.

Despite the fact that we weren’t planning on it and despite the fact that I knew the money would be used in a haphazard way (a personal judgement that has no bearing on anything really), I sent this family member the money I “owed” them. Will I ever know if I owed them or if the money was really a gift? Probably not but it doesn’t matter anymore. I wasn’t going to let money come between my sanity and having a decent relationship with my family.

As soon as I mailed the check, I felt a calm come over me that I wouldn’t have felt if I let this situation get any worse. Things could have escalated to the point where I couldn’t have talked to this person without anger being involved or if any happiness came to my family that had anything to do with money they would have tried to be make us feel shameful that we spent money “meant” for them. I definitely didn’t want any part of that.

So my simple advice is, don’t ever borrow money from a family member and don’t ever lend money to a family member. If they, or you, are in the position to give some away, with no strings attached, to help someone out. By all means go for it. Otherwise, you are just asking for trouble.

He would probably so, “Well that has worked for you so far, hasn’t it?”

I have listened so long, I know all his answers. Is that good or bad?

So now the only debts we have left to tackle are the various medical bills we still can’t sort out from the birth of our daughter (my wife kept her maiden name when we got married and the baby has a combination of both of our last names, a choice we both decided on, so I am sure we have confused the insurance companies a lot), my student loans (that have accrued almost $5000 in interest for no good reason) and our mortgage. That’s it. Well that and the $500 a year for a while to pay off the new home buyer loan. I wish they would let you pay that off early. I need to look more into it.

We want to drop a big chunk on the student loan, but we might hold out until the insurance stuff gets sorted and just pay it all off at once. Hopefully, it will all get solved soon. It will be nice to put the money we were paying on her consolidation loan into other things to get the debt off our back that much faster. I hope soon I can write to let you all know we are debt free except our house. 5 years ago I would have never imagined being in this position, nor would I have cared. Growing up sure is fun.

Wikipedia explains tax withholding in the United States as follows:

In the United States income tax system, employers are required to withhold a portion of each employee’s income and pay it directly to the U.S. Internal Revenue Service. This withholding acts as a prepayment of tax they will owe at the end of the year, as well as a direct payment of certain other taxes.

In the History of the U.S Tax System, the U.S. Department of Treasury describes tax withholding.

This greatly eased the collection of the tax for both the taxpayer and the Bureau of Internal Revenue. However, it also greatly reduced the taxpayer’s awareness of the amount of tax being collected, i.e. it reduced the transparency of the tax, which made it easier to raise taxes in the future.^[1]

A taxpayer will get a tax refund if the withholding for the year was greater than the income tax actually owed.

No one wants to owe the IRS at the end of the year but like I stated before, no one minds a refund. What are the refund’s benefits? You are giving the government an interest free loan for a year because, more than likely, you don’t know any better. The worst thing about it is you are lowering your take home pay throughout the year which is money you could be using right now, today. You just need to change the way you look at your tax liability. If from now on you look at your anticipated tax return as your money and not the government’s, you are probably going to be less likely to loan it out all year, right? The best thing you can try to do is break even at the end of the year.

So where do you start?

Do you remember all those forms you filled out when you first got your job? Well one of them was good old Form W-4. It is the piece of paper that tells your employer how much to withhold from your check. Your tax liability is based on the following things:

• Marriage/Divorce
• Birth of a child
• Home purchase
• Change in employment status for you/your spouse

Here is something that I didn’t know until recently and it is very important. You can change your W-4 as many times as you want. As many times, that’s right. But that’s how they get you. When you change your information and if something is wrong, it’s your fault and if you have any questions, most employers can’t answer you about any of it. So maybe you just guess and wait until your tax paperwork comes in. Or maybe you decide not to change anything at all. That doesn’t sound like a good plan to me.

That’s exactly how I used to feel. Then I read some and learned a little. Then I read some more and learned a little more. Eventually I felt confident enough to question my taxes. Then when I wanted to change my withholdings and balance my tax liability out for the year, I found the Paycheck City W-4 Assistant and figured out that I was supposed to be claiming 5 withholdings instead of just 1. I did get married, had a daughter and bought a house all in the same year, so that changed my liability a lot. If I hadn’t read and learned as much as I did, I wouldn’t have even thought to change anything. I won’t know until next year if my withholdings are correct, but I feel more confident in the fact that if they aren’t, I am not helpless in that fact. I can change my W-4 until I get it right.

Hopefully, this information will be beneficial to someone. If anything I claimed was true isn’t, please let me know. I don’t want to pass on anything incorrect.

Jonathan Jarvis did a tremendous job in explaining things. Here is part one. Part two can be viewed after the break.

here is the post in its entirety.

by Joe Scarborough

Host of MSNBC’s Morning Joe, former member of Congress

The Loyal Opposition

One of the more hopeful aspects of Barack Obama’s historic campaign in 2008 was his call for a new style of politics. It was a message that was appealing even to those of us who did not agree with many of his political views.

I was listening to Rush Limbaugh today (I do it because I like to get all sides of the news and I think he is hilariously arrogant) and he mentioned a story he read in The Boston Globe about people in Boston who were unemployed and now finding the time to do all the things that working had prevented them from doing beforehand. ?!? They were actually glad they were laid off. Rush said the people in the story talked about getting back into hobbies they missed, taking vacations and visiting museums; anything but seriously looking for a new job. I immediately passed this off as another instance of Rush slanting the story for his own gain, of which he is brilliant at doing, and went to lunch. When I came back, he was still talking about this story and I decided to read it for myself. He must have exaggerated something right? Right? Sadly, no. Unless I missed something or this was a big joke, these people they interviewed seemed pretty happy they were not working. The article even spoke of how there is less of a stigma with being unemployed nowadays than in previous time periods and seemed to try to make it seem okay. There was even a blurb from a professor about success syndrome to nail home their point.

The people in the article were now having to give up things never before considered; although the things they stated the parties involved were having to give up now were just things I would have been doing anyways. Here is an example:

“Winner’s epiphany has come at a price. The 46-year-old has cut back on the nanny, slashed last year’s Christmas budget in half to $400, and started shopping for less expensive groceries at Market Basket. The usual February ski vacation is being replaced by a stay-at-home vacation with the kids.”

If he isn’t working, why does he need a nanny?

Seriously! Seriously!

My grandfather would kick mine, his and anyone else’s involved butts for not having a job without being seriously dead. What has the world come to? I know this is just a very small group of people, but I’m sure instances like this are happening more and more across the country. Read the article at the source to get a better perspective or follow the break and read it here.

So what do you think?

For now, laid off and loving it

Some are finding respite in a life without work

By Jenn Abelson Globe Staff / February 23, 2009

A few days after David Adler’s wife decided to leave her law firm in December, he was laid off from his job designing software at Brightcove.It was shocking. And scary.

Until it wasn’t. Adler has quickly learned to appreciate some aspects of his unexpected unemployment.

The 42-year-old spends his days doting on his 6-month-old daughter, visiting museums with his family, and preparing for a possible exhibit of his photos at a local coffee shop in Dedham. Living off savings, unemployment, and severance packages, Adler knows he has to get a job eventually and has started the search. But for now, he’s cherishing every moment. “It’s our first child and I love watching her grow,” Adler said. “And it’s nice to have time off and get in touch with my old hobbies.”

As the ranks of the nation’s unemployed grows, more Americans are facing the reality of life without work. Despite the grim task of making ends meet (firing the nanny, bailing on Whole Foods, applying for unemployment), there is a newly forming society of people who are making the best of being laid off. They are rediscovering hobbies. They are greeting kids at the school bus. They are remembering what daylight actually looks like.

And the massive layoffs by companies nationwide – nearly 600,000 jobs were lost last month – has helped remove the stigma and shame of being unemployed, according to John A. Challenger, chief executive of Challenger, Gray & Christmas, a Chicago outplacement firm.

“There’s less of a ‘why aren’t you working attitude’ that is giving people some extra space and freedom to explore new directions and just take time off to do the things they’ve wanted to do, whether it’s spending more time with children, taking a class, or traveling around the world,” Challenger said.

John Stephen Dwyer so far isn’t missing his job or former office overlooking Chinatown. The 41-year-old Boston native was laid off in November from his $40,000-a-year job as education coordinator for the Clinical Research Graduate Program of Tufts University Sackler School of Biomedical Sciences. And he hasn’t started seriously looking for new work.

Don’t get Dwyer wrong – times aren’t exactly easy. He has applied for unemployment and now takes the subway instead of taxis. But he has started doing things he enjoys: taking a class in history and ethics of biotechnology at the Harvard Extension School; cooking food for the homeless; and attending weekday Mass at churches around Boston.

“I want this year to be the year in which I transition from doing something just because it’s a good job and pays well to doing something I’m interested in,” Dwyer said.

As bad as it feels to lose a job, temporary unemployment can provide a much-needed intervention to workaholics who can benefit from such a break, said Douglas T. Hall, a professor at the Boston University School of Management.

“It’s the success syndrome. You work hard, you do well. It’s very satisfying and that gets you more involved to start working even harder,” Hall said. “It’s a success spiral that people get into. And sometimes it takes some extreme experience to get out of that spiral.”

Kendra Winner, who in September lost her $95,000-a-year job designing teacher professional development training, described her escape from the spiral: “I’m loving being home because I no longer feel like the Eiffel Tower is crushing my skull. I was squeezing so much into limited bandwidth as a working mom. Now, I don’t feel like I’m chronically overcapacitated.”

Winner’s epiphany has come at a price. The 46-year-old has cut back on the nanny, slashed last year’s Christmas budget in half to $400, and started shopping for less expensive groceries at Market Basket. The usual February ski vacation is being replaced by a stay-at-home vacation with the kids.

“We’re trying to cut down any place we can,” Winner said. “That’s not fun, but we’re focusing on making memories.”

And these days, Winner has a hard time imagining going back to the crushing schedule of a full-time job and missing out on the simple joys, like staffing her first school field trip.

She is looking for work, particularly because she’s concerned her husband’s job at an advertising technology firm isn’t safe. And after spending a recent week home with her sick 3-year-old, Winner was starting to miss work.

Almost.

Jenn Abelson can be reached at abelson@globe.com.