My House Divided
Catherine Horiuchi | Feb 13, 2025
I'M A HOUSEHOLD of one—in theory. True, one adult child lives rent-free in our family home in California. Her first full-time job’s wages are too low for her to afford an apartment in our expensive urban area. I’m also paying college expenses for another daughter living on campus 80 miles away. She’s working part-time and will graduate this coming spring semester. With a STEM (science, technology, engineering and math) degree, I hope she’ll find gainful full-time employment soon after. My son is in Wyoming finishing up an alternative high school program. He just landed his first paid internship at an agricultural lab, the first step toward a career in environmental science. I provided the security deposits to get him into his first apartment. I also drop a bit of money into his bank account at random intervals. I do the same for his sisters, just to take the edge off early adulthood. Finally, wherever I reside, I share quarters with the family dog. So, I’m never entirely a household of one. Yet I wonder if my living situation will simplify as my children take flight. Due to my frugality and some luck, I have choices when answering these four key questions: Where do I want to be? What do I want to do? Who will accompany me? How much will all this cost? This last financial question causes me more angst than the existential where-what-who kind because there’s less opportunity to recover from any significant money mistakes I may make in retirement. To ease my concerns, I’ve considered selling the family house in California, rather than continuing to spend energy and money tending to it. After half a lifetime there, however, I wonder how it would feel to lose my old neighborhood. A song from the scouting bonfires of my…
Read more » From Two to One
Catherine Horiuchi | Apr 30, 2020
FOLLOWING MY husband’s death, I went from feeling prosperous to precarious in the space of a few short months. For decades, I’d had something extra in hand, beyond the minimum sum necessary to keep going. That sense of prosperity was now gone. This wasn’t just my imagination. Studies have found that widows are significantly less wealthy than their married counterparts. One academic article notes, “The death of a spouse is an event that may precipitate a large decline in wealth.” Similarly, a National Bureau of Economic Research study found that, “The death of the husband very often induces the poverty of the surviving spouse, even though the married couple was not poor.” For me, a decline in wealth might have been fine if our life had been just the two of us. After all, my husband would no longer be spending the money that he would no longer receive. Problem is, I have three children who are not yet grown, and everything else that goes along with a family of four. Though we never expected nor precisely planned for an untimely end, it turns out that our work-life choices and hopes for retirement had created a financial buffer. We had saved a higher percentage of our earnings than many others and had done so for decades. Still, since my husband’s death, I have been anxious to avoid a steady decline in our family’s nest egg. To that end, I’ve adopted a strategy for ongoing spending that I borrowed from a health care manual: “To lose weight, eat half what you now eat.” We all know how hard it is to slim down by merely consuming a little less. Our brains and bodies outsmart our best intentions. It seems that, if we want to shed pounds, we have to set far more…
Read more » College Crapshoot
Catherine Horiuchi | Feb 8, 2021
A LIFE OF FRUGALITY might mean your children graduate college debt-free, which is a major accomplishment. But what about your happy-go-lucky neighbors, who spent every dime they earned and never saved for college? At issue here is the Free Application for Federal Student Aid (FAFSA), which is the basis for the all-important expected family contribution (EFC). The whole thing can seem like one big crapshoot, as I can now attest. The EFC may determine that your spendthrift neighbors’ kids also get to graduate debt-free. Alternatively, even though they have no assets to be assessed, the EFC may require a substantial contribution from their income each year. On top of that, even an EFC of zero is no guarantee that a university will offer your child a full ride, plus the aid package may include substantial loans rather than much-coveted grant money. Retirement accounts are ignored in the FAFSA calculation, as is home equity, though some colleges may look at both when doling out the financial aid they control. Still, prioritizing retirement accounts and building up home equity is crucial if you’d rather not be expected to spend a quarter of your net worth or more on college costs. Once the FAFSA is filled out, your EFC is instantly displayed onscreen, formulaically derived from investments, income and “prior prior year” tax returns. For a thrifty soul like myself, the EFC is trouble and, indeed, double trouble with twins. Worse, in another three years their younger brother could also start college, leaving me with a trifecta of savings-chomping scholars. Recently passed by Congress, the 2021 omnibus spending bill includes changes to simplify the FAFSA process and dumps the term EFC, with all its negative baggage, replacing it with a new “student aid index.” We’ll learn more when the index is implemented for…
Read more » Household Affairs
Catherine Horiuchi | Nov 20, 2024
IN JANUARY, I surrendered to passionate irrationality, buying a park unit in Arizona that has become my second home. Now I understand why, at least in the movie cliché, a man might buy house slippers for his long-suffering wife’s birthday, while giving flashy, expensive baubles to his girlfriend for no reason at all. My single-wide “girlfriend” is tiny and fragile, the bloom off her youth. Things that improve her are easily obtained. A phone call to a friendly fellow at a store, the provision of a credit card number, and—voila—my private world is transformed for the better. Rational me knows the value I derive from each expenditure might be marginal, perhaps an imaginary gain or even an actual loss. Meanwhile, our longtime family home in California could also benefit from a new refrigerator, as well as much, much more. Over three decades of living in that house, I’ve remodeled, bought new appliances, replaced a furnace, changed out windows, and completed countless other projects. I have clear memories of improvements that helped and ones that disappointed. As of today, my 2007 kitchen remodel refrigerator has yet to die, so I’m thinking it can wait another year. After all, even when I’m living in the old family house, I’m not staring at the refrigerator nonstop. I might be in the living room, or dining room, or upstairs or out in the yard, with no thoughts of refrigeration clouding my mind. Here in my immobile home, the living room is also the dining room and the kitchen. Its tiniest flaws, any neglected maintenance, sit in plain view. On top of that—though not always the case—improving my single wide can require minuscule amounts of time, effort and cost. Less than a single quart repainted the “kitchen” and, with under 20 square feet of visible…
Read more » Leaving Early
Catherine Horiuchi | Sep 24, 2020
LIKE OTHERS, I TOOK my first part-time job as a teenager and, once working fulltime, stayed at it steadily for decades. Being an adult meant being a worker, affiliated with some firm or another, one industry or another. My plans for ever exiting the labor force were vague: “Save for the future, so someday you will retire with honor and dignity to spend your waning days as you desire.” I saved steadily, putting me on track for future retirement. The past 15 years at work have been rewarding, challenging, and required every bit of skill and effort I could muster, and I loved my work. As friends and family retired before me, I began wondering if I’d be one of those people who never stop. But that changed in 2019. I spent most of the year dealing with my husband’s death and a spell of accident-induced temporary disability, before returning to campus last fall. But even before the first day of class, I notified my dean that I was considering early retirement at year’s end—assuming a suitable exit package could be structured. Due to my injury, my commute by car and train was difficult to manage. I was still grieving for my life’s partner and the future we had anticipated, with little clarity about the alternate future I was now creating on my own. Additional responsibilities as a single parent added to my worries. Whenever we discussed retirement, my husband—who was retired at the time of his death—encouraged me to continue working as long as I felt effective and engaged in my duties. Before he passed away, our plan had been for me to work another five years. By then, our youngest would be out of high school and we could unwind as empty nesters. But after my husband’s death…
Read more » When It Rains
Catherine Horiuchi | Dec 19, 2019
TWO WEEKS AFTER my husband’s death, we held a memorial service for local friends and family. Days later, after a reasonable amount of online research, I visited a car dealer. It’s my experience that bringing at least one youngster along speeds up dealmaking, plus a parent can get unvarnished opinions about life in the backseat. So I brought along my 13-year-old. The two of us test drove two used cars and bought one of them. The next day, I drove to work in the city, instead of taking a train from the park-and-ride lot, as I'd done for the prior decade. My goal was to shorten my commute and reduce my hours away from home. This ended badly when I slipped on wet pavement in a parking garage, resulting in an injury that required surgery and time off work. Having never endured such an injury before, it was a shock to realize that—for the first time in my adult life—I was neither earning nor saving money, especially during a period of such high expenditures. Further, we’d lost all my husband’s future cash flow and his sharing of family responsibilities. Would that I had a partner and decades of earnings to recover the lost cash. But instead, I was on my own, launching three young adults. I had read about the "widowhood effect." I was at elevated risk of illness, injury or death. I had been careful. But I’d already exceeded the three-to-five days off work allotted for a death in the immediate family. On top of that, we grieving people are often told to stay busy and try to get back to normal routines. While anyone can lose their footing on a rain-soaked walkway, possibly nothing bad would have happened if I’d kept to my familiar commute or, even better, stayed…
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