HERE'S A RECIPE FOR disaster: a good internet connection, plenty of storage space, lots of time on your hands—and credit cards. Impulsive shopping has a name, oniomania, and the above recipe makes it all too easy. If you have a credit card, research suggests you’ll spend significantly more than if you were paying with cash or a check. The availability of 24/7 online shopping makes it just that much worse. Here are eight signs—besides the pile of packages outside our front door each day—that tells me impulsive spending has reached our house: 1. You get a “charge” each time you place an order. I’m not just talking about the credit card charge. You see something online and you think, “Wouldn’t that be nice to have?” It’s an item you wouldn’t have gone looking for—and wouldn’t have bought—otherwise. Now, with the tap of a few laptop keys, it’ll be delivered to your door. You get the added thrill of waiting for it to come, including tracking its delivery online. 2. You think you’re saving money. We love our Amazon Prime membership and our Amazon Prime 5% cash back credit card. The free shipping, with free returns and Prime Video thrown in, means we’re constantly saving. Problem is, all the money we’re saving puts a big dent in our bank account. 3. You forget what you ordered. My job is to monitor our credit card charges. My spouse doesn’t buy a few big things. Instead, she buys a ton of little things each month. We have a huge amount of small charges on our credit card. I’ve found charges that she initially denied making because she simply forgot about them. I challenged one such charge with the credit card company, only to later admit it was a purchase we’d forgotten about. 4. You buy stuff you don’t need. One day, I found a couple of containers of finger moisturizer on my desk at home. This stuff keeps fingertips tacky and is frequently used by folks who count money or sort paperwork. My wife is a bank teller, so I brought it to her, thinking she left it on my desk by accident. She looked at me sheepishly and said, “I thought you might want it. I bought it but I don’t want it now.” This happens more than I'd like. 5. You start buying stuff for others that they didn’t ask for. At some point, you run out of stuff that you want and you start making purchases for others. It’s too easy. You’ve got free shipping anyway and it goes straight to them without you having to leave the house to buy it, wrap it and take it to the post office. Even if it’s useful, it still isn’t your job to buy things for them, especially if they didn’t even ask for the items in question. 6. You buy large quantities that’ll last until you die. I have a box of staples that has sat on my desk for 30 years. I’ve used about a tenth of them. One day, I found two new boxes of staples sitting on my desk. My spouse bought them because they were “cheap.” [xyz-ihs snippet="Holiday-Donate"] She saw me brushing lint off my jacket. She bought me not one lint brush, but three. Don’t get me started on the 15 rolls of Scotch tape, 24 toothbrushes, 16 tubes of toothpaste, 27 cans of tomato paste or the back bedroom filled with toilet paper and paper towels. It’s not “cheap” or “a bargain” if it’s something you won’t use before it goes bad or you die. 7. You get mad if someone doesn’t want your purchases. I used to be afraid to reject some purchases my spouse made for me out of fear I’d hurt her feelings or make her mad. The result was items would pile up in a dark corner of the house and be long forgotten. I’m not that way anymore. I will lovingly tell my spouse that I am never going to use that item, and then I quickly get a return slip printed. She gets over it. 8. It doesn’t have to be online shopping, either. You can find great bargains, particularly clothes, at thrift or consignment stores. My wife was an expert at outfitting our five kids early in our marriage. She had a part-time job in a nearby city that had many such shops. She’d spend her lunch hour looking them over. Every week, she came home with a big bag of clothes and a big smile. So much so that I bought and filled several storage bins with clothes. They were stacked all around our house. Unfortunately, the bins were never opened again and what was in them became lost to time. Eventually, most of the bins were carted off to the Goodwill store. The thrill of the hunt had overtaken the needs of the family. So, what did we do to limit this disaster? First, it’s good that opposites attract because, if both of you are impulsive spenders, you’ve got big problems. One spouse has to act as the police, which in our marriage is me. I monitor all the financial accounts and, as I’m retired, I see all the packages that come to the house. That gives me an unfair advantage. I don’t argue with everything, but most purchases for me get returned. That has diminished some of my wife’s shopping fun. It also makes her feel a little guilty buying items just for herself. Second, my wife is nine years younger than me and still working. We live on my pension but max out her 401(k). This makes me feel better, because it means we’re still saving a hefty sum. Finally, choose your battles wisely. Some junk spending isn’t going to hurt you, and it does add some fun to life. Ken Begley has worked for the IRS and as an accountant, a college director of student financial aid and a newspaper columnist, and he also spent 42 years on active and reserve service with the U.S. Navy and Army. Now retired, Ken likes to spend his time with his family, especially his grandchildren, and as a volunteer with Kentucky's Marion County Veterans Honor Guard performing last rites at military funerals. Check out Ken's earlier articles. 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I'VE MADE A LOT OF investing mistakes in my time. In fact, if I ever wrote a book on investing, the title would probably be Don’t Go There, It Sucks. I’m a Kentucky hillbilly and, yes, that’s hillbilly talk. Another local colloquialism is, “Careful, or you’ll end up like Scrambo Hill.” I don’t know who Scrambo was. But apparently, he resided around our parts at one time, and you don’t want to end up at the bottom of the barrow like him. Let me say first that Cindy and I are financially secure today because we’re supersavers—and despite my investing skills. My two big mistakes are fairly common: trying to time the market and constantly shifting my investment style. You know what? Everybody has heard of Warren Buffett. He’s the senior statesman of Wall Street with an investment record to die for. Has anybody heard of Ken Begley? Uh, doesn’t ring a bell? Well, that’s my name at the top of this column. So, if everybody has heard of Warren Buffett and Warren constantly says that he can’t time the market, why does Begley think he can? That wasn’t a trick question. He can’t or, rather, I can’t. So, why do I try? Out of sheer freaking fear. Here’s what I’ve learned about myself: I have been a part of many a good panic and sometimes led a few. Why? I can’t stand losing money, even if it’s only short-term paper losses, and it sometimes causes me to make rash decisions. I’m not stupid, but sometimes I can be. Cindy and I had accumulated what, for us, was a large net worth in the late 1990s, with a fair amount of our money in the stock market. Even with a relatively conservative portfolio, the sinking and soaring of said market would involve larger and larger amounts of money. The euphoric feelings of the gains never equaled the despair of the losses. At one point after Sept. 11, 2001, our net worth had plunged about 25%. I always think of money in terms of how long we had to work to accumulate it. To me, money is stored work. That 25% loss was the equivalent of some three years of gross income, and it happened pretty dang quick. It was unnerving to say the least. [xyz-ihs snippet="Mobile-Subscribe"] To my credit, I didn’t sell in a panic and, due to dumb luck, even bought a bit when the market hit bottom. But then I did something that was really stupid. I started selling out a huge part of our portfolio in bits and pieces as the stock market rose. The money ended up in low-interest-bearing accounts, which we then held for years. I couldn’t even tell you how much money we could have had today, even considering the next big drops in the markets that have happened since then. But let me assure you, it would be a bunch. That brings me to my second big mistake: a constant desire to tinker with investment types, rather than sticking with index funds. I just can’t seem to keep my hands off my investments, frequently changing styles and directions. Financial tinkering is like following a compass, only you first follow it north, then south, then west, then east. You know what happens? At best, you’re going to get somewhere, but it’s going to take you a lot longer than just going in one direction all the time. At worst, you aren’t going to make any progress at all, instead ending up where you started or maybe even further from your goal. I’ve gone from growth funds to value funds to index funds. Sometimes, I’ve been lucky. But for the most part, it was a lot of work for a lot less gain. I should have just gone with a set plan involving index funds. We’d be much richer today if I had. So, have a safety net of cash to last for a few years, go with index funds, and stay the course through thick and thin. You won’t end up at the bottom of the barrow with Scrambo. You’ll also look a lot smarter than me. But based on my history, that isn’t saying much. Ken Begley has worked for the IRS and as an accountant, a college director of student financial aid and a newspaper columnist, and he also spent 42 years on active and reserve service with the U.S. Navy and Army. Now retired, Ken likes to spend his time with his family, especially his grandchildren, and as a volunteer with Kentucky's Marion County Veterans Honor Guard performing last rites at military funerals, including more than 350 during the past three years. Check out Ken's earlier articles. [xyz-ihs snippet="Donate"]

THIS IS MY FIRST article for HumbleDollar. I’m new to the site, but not new to writing for the public and, indeed, I’ve contributed regular columns to some small newspapers. My life has had more twists and turns than going down a Kentucky country back road filled with hillbillies, of which I am one. Kentucky is either the poorest state in the country or next to it by any measure you want to look at. Still, at age 65, I feel like I’ve had a rich life and done it all. I’m a husband and father of five. I’ve also had chronic health issues for 30 years. We’ve had family members struggle with depression. We suffered through relatively low-paying jobs with multiple employers that either had massive cutbacks, spinoffs or straight up went bankrupt. Yet our family has survived and at times thrived. I was never unemployed and sometimes held up to three jobs at once. But I sure had a lot of jobs I didn’t like. Still, it all paid off. In fact, I retired at 59, and my wife and I are financially secure. Three of our children became civil engineers, one a mechanical engineer and another an elementary school teacher. All graduated college with no student loans and some with substantial bank accounts. The youngest graduated this May. They still have their problems, but at least money hasn’t been one of them. How did this happen? It’s not hard for me to pinpoint the biggest reason. The life experiences of my parents resulted in who we became. My mother was raised by a farmer and grain mill worker during the Great Depression. She was one of 11 kids. My maternal grandfather was in the army in World War I and served in France. He lost a hand in a mill accident and later his wife when she was age 47. They had four sons in World War II at the same time. My grandfather did more with one hand than most people do with two. My father was one of six children. Dad served in World War II and had a brother-in-law who was captured at the Battle of Kasserine Pass in North Africa. That uncle became a prisoner of war for about 24 months. My dad’s brother was the mortar platoon leader at Pork Chop Hill, which was overrun during the Korean War. Dad opened his own business after the war selling radios, televisions and furniture. He was a heck of a salesman. My mom raised us kids and ran a small business out of the house as a seamstress making clothes and doing alterations. They were both workaholics because they had to be for their growing family. As a child, I learned pretty quickly that, if you thought life was unfair or you were overworked, you better not complain to our parents. They were too busy to listen and, in any case, they weren’t having any of it. [xyz-ihs snippet="Mobile-Subscribe"] One thing they did for us: get us jobs at an early age. I’m proud to say that I was the youngest one put out on his own. This is what defined me and set me up for the rest of my life. I had a paper route at age 10. Those newspapers were delivered seven days a week, 365 days a year through rain, sleet and snow. I had to collect the bill from the customers and then make my way to the post office to get a postal money order, so I could pay the newspaper each Saturday. I had a flat tire and learned my first lesson shortly after I began my “employment” as a paperboy. The inner tube was shot. I went down to the local hardware store and bought a replacement. Afterwards, I went to my father’s store and stuck out my hand, telling him the situation and expecting reimbursement. My dad hemmed and hawed, mumbling something about how I had a job now, but eventually he gave me the money. I was clueless as to what had just happened until my older brother filled me in. He said, “Kenny, you work now, so you can’t ask Daddy for anything anymore. You have to pay for it yourself.” I had committed a breach of etiquette, but accepted this news because my older brother was my idol. He was just looking out for me by telling me my mistake. My second lesson: Don’t be offended when good people tell you what you’re doing wrong. I never asked Daddy or Momma for anything again, and I learned that I needed to be independent. Yes, I was on my own. Those papers were delivered to the poorest section of town and to the housing projects. The third lesson from the paper route: While money won’t buy you happiness, the lack of money certainly buys you misery. You don’t want to end up like some of my then customers. They call it work because it can be unpleasant, but I learned from my customers that there were other things there were even more unpleasant than work. There are lots of stories from that paper route to the present day, with lots of success and maybe even more failures. I hope to relate them all on this website. I sure would like to help somebody the way my brother helped me so many years ago. Ken Begley has worked for the IRS and as an accountant, a college director of student financial aid and a newspaper columnist, and he also spent 42 years on active and reserve service with the U.S. Navy and Army. Now retired, Ken likes to spend his time with his family, especially his grandchildren, and as a volunteer with Kentucky's Marion County Veterans Honor Guard performing last rites at military funerals, including more than 350 during the past three years. [xyz-ihs snippet="Donate"]

IT'S ONLY BEEN relatively recently that mankind has come to rely on banks, brokerage firms and investment companies to build wealth. Tangible property—land, gold bars, houses, livestock and so on—was the standard of wealth just a couple of centuries ago. The Bible frequently cites cattle to signify someone’s wealth. If folks had “cattle on a thousand hills,” they were a billionaire in that era. Wealth was something that you could physically lay your hands on. By contrast, today, we can look up accounts on our computer and, in a flash, determine our net worth. It’s funny when you think about it: Figures on a computer screen can make our spirits soar and plunge. Meanwhile, physical assets can still represent wealth, of course. But some folks take this to an extreme—to their detriment. Let me explain. I’m an accountant by nature and training. Numbers on paper or a computer screen mean real wealth to me. It gives me a feeling of security knowing that my wealth is safely locked in a bank vault or somewhere similar that a thief can’t reach. Yes, scams and fraud exist. But I figure my intangible wealth is mostly safe as long as I act prudently and carefully watch over it. What about physical assets? They just don’t mean that much to me. My wife and I didn’t go for the lavish home when we built our house 32 years ago. Sure, houses can go up in value, but to us it’s just a functional living space. We didn’t build the house because we thought it would be a good investment. Yes, the house has value, but its worth just doesn’t feel as real to me as money on a computer screen. Owning our home does spare us the cost of renting. Yet we still have to pay property taxes, homeowner’s insurance and for the occasional major repair. All of these drain money from our net worth. I know many others feel differently. They get no happiness from figures on a computer screen. They need to own something physical to get a feeling of contentment. It could be a thousand different things: TVs, cars, shoes, Harleys, vacation houses. Nothing wrong with that—unless the things they buy don’t go up in value. Then, they can end up owning a lot of junk. My wife has worked as a bank teller at three different institutions over the decades. She told me once that I’d be surprised at the number of folks driving up to her window in expensive cars who are overdrawn on their checking account. Driving a fancy car makes them appear wealthy. The car is there for everybody to see. If folks act rich but don’t have money, there’ll be trouble when they want to retire. I’ve seen situations like that in my life, and I’m sure you have, too. Here’s a good example: One couple started out much more successfully than us. They got great, high-paying jobs right out of college. They made twice what my wife and I made in our best years, and that was just at the very beginning of their careers. Yet money seems to flow through their fingers like sand. Their yard is littered with old cars, motorcycles, ATVs, trailers and some things whose purpose has me stumped. None of this stuff is new, but when they bought it, they said it was “a great deal.” To me, most of it looks like junk. Every time they had two nickels that they could rub together, they ran out and bought something else. They got antsy when they had any cash in the bank. It demanded to be spent. Sometimes, they’ll travel across several states to buy a “bargain” car. These bargains sometimes had hidden problems and blew up in their face. Occasionally, they made money selling some of their bargains. But most just took up space around the house. Their garage is so full their cars don’t fit. I couldn’t figure it out. Why not just go to work, draw big checks, pay off the house early and max out their retirement accounts? It doesn’t require any special skill or ability. You just need the discipline to do it year after year. Why does this couple engage in such time-consuming futility? Then it hit me. These good folks couldn’t look at a spreadsheet and see real wealth. Instead, they had to put their hands on something physical to feel their wealth—even if it was an old junk car. As they advance to middle age, I fear their time for saving and preparing for retirement is slipping away. I also fear that they’ll hit some financial bumps in the road—a job loss or health issues—that will rock their world, and they won’t be prepared financially. Ken Begley has worked for the IRS and as an accountant, a college director of student financial aid and a newspaper columnist, and he also spent 42 years on active and reserve service with the U.S. Navy and Army. Now retired, Ken likes to spend his time with his family, especially his grandchildren, and as a volunteer with Kentucky's Marion County Veterans Honor Guard performing last rites at military funerals. Check out Ken's earlier articles. [xyz-ihs snippet="Donate"]

TWO THINGS HEAVILY influenced my financial life. The first was my short stint after college as an internal revenue agent with the IRS. The second was getting married and having five children. Result: I’ve spent most of my adult life as a tax-averse junky using retirement accounts to get my high, so much so that there’s a risk our retirement-account withdrawals will put us in a much higher tax bracket than when we made our contributions. I’m age 67 and Cindy is 58, and today we have 98% of our financial assets in retirement accounts. I was an internal revenue agent from 1981 to 1983. I quit because it seemed everybody who I met either hated me or was scared to death of me. Still, the job convinced me that I should legally avoid taxes at all costs. But how? Starting in 1981, 401(k)s became fairly common. The following year, traditional IRAs became available to workers with pensions. That’s when I started funding IRAs, which were then limited to $2,000 a year. I really liked the idea of avoiding taxes until retirement, which at the time was some 40 years away. I married at age 31 and my wife was 22. Opposites attract: I was a saver and Cindy was a spender. We often clashed over spending. We never made a lot of money and budgeting never worked for us. But we agreed on one important subject, and that was having children. I noticed that whatever we put into our checking account would mysteriously disappear by the end of the month. There were a lot of arguments over the years. We both thought that our marriage wouldn’t make it. After all, money arguments are the No. 1 reason marriages fail. After one bitter argument, I went into my payroll account and increased the withholding for my 401(k) by a couple of percent. It made me feel better, and it seemed preferable to arguing over how much we spent. I later did the same with my wife’s withholding. After we started having kids, it didn’t make sense for Cindy to continue working full-time. She worked one day a week as a bank teller for 12 years, before going back full-time. While she was working part-time, I made sure that we contributed the maximum each year to both our IRAs. I also contributed a large percentage to my 401(k). It was at this time that I started buying tax software. Before we would file our taxes, I’d use the software to run “what if” scenarios, so we could use our child tax credits in conjunction with retirement-account contributions to zero out our tax liability. Eventually, because of our large tax-deductible retirement contributions, we got to the point where we couldn’t use all of our tax credits. Still, we continued to make those retirement contributions. But we also started converting traditional IRAs to Roths, which led to more potentially taxable income and allowed us to use up the credits without generating a tax liability. During this time, I was working up to three jobs, including my part-time employment in the Army Reserve, where I served until age 60. I retired from my civilian job at 59. How did my wife take all this? Cindy didn’t really like it, but somehow money put into retirement accounts would never get touched. Contributions served two purposes. They increased our retirement savings, while also limiting our spending. My feeling was, if things got too tight, we could always lower our retirement contributions or take a loan against our 401(k) balances. The loans only happened a few times for small amounts. Our arguments over money grew less frequent. Any time I thought Cindy was spending too much, I’d remind myself that we were still super-saving for retirement, and my anger would pass. Our five children picked up on our tight-money ways. They attended public colleges in Kentucky that are relatively inexpensive. They had part-time jobs and paid internships during high school and college. They also received multiple merit-based scholarships, though no non-merit aid. One lived at home during college. Even though we gave our children little financial help toward college, each graduated with money in the bank and no debt. Our last child graduated when I was age 65. Four are engineers and one is an elementary school teacher. Three have master’s degrees. Believe me, we’ve had other major problems with our children, but handling money hasn’t been one of them. We’ve continued converting our traditional IRAs to Roths long after our eligibility for the child tax credit passed. Yep, we’re actually paying taxes now, but keeping it in the 12% bracket. Today, about 21% of our retirement accounts are Roths. I plan on continuing to convert until I start drawing Social Security at age 70 or perhaps until required minimum distributions begin at 73—provided, that is, we can remain within the 12% tax bracket. Cindy still works full-time. She contributes the max to her 401(k), and we also max out our IRAs. She’ll retire next July at age 59. We pretty much live on my Army Reserve pension, a tiny pension from a civilian job, and whatever is left from Cindy’s salary after her 401(k) contributions. More disciplined people could no doubt have done better. But we’re both happy with how things have worked out. We now splurge more on our adult children and grandchildren. We can also eat out and travel without worrying about money. In fact, I suspect we enjoy these things more than most—because we’ve done so little of them in the past. Ken Begley has worked for the IRS and as an accountant, a college director of student financial aid and a newspaper columnist, and he also spent 42 years on active and reserve service with the U.S. Navy and Army. Now retired, Ken likes to spend his time with his family, especially his grandchildren, and as a volunteer with Kentucky's Marion County Veterans Honor Guard performing last rites at military funerals. Check out Ken's earlier articles. [xyz-ihs snippet="Donate"]

IT TOOK FIVE FALSE starts to write this column. Each time, I’d inundate readers with information. So, here’s a sixth try. Have you ever seen those questions to financial advisors on the internet that say, “I have [insert dollar amount]. Can I retire?” How the heck could the advisor give a reasonable response? To answer the question, it takes more than simply knowing how much you have in the bank. You need a lot of personal and financial information to make the decision to retire. Much of it has to do with personality and family situation. Let me tell you how I decided to retire at 60. Retiring at that age wasn’t my plan. But I came to the decision that it was for the best. Here’s why. I’ve generally had at least two or three jobs for most of my working life. I’m not a workaholic. But you do what you have to do when you have a good wife and five kids. My wife Cindy and I have contributed to 401(k)s and IRAs for decades. She stayed at home to raise our kids for 12 years and she’s nine years younger than me. She works at a local bank as a teller. Cindy plans to work until age 59. Our ace in the hole for retirement has been my pension from 43 years of active and primarily reserve military duty. The pension started at age 60, increases each year with inflation, is larger than my future Social Security check and includes a family medical insurance plan through Tricare. We have no debt and we had two children in college at the time I retired. Both were covered by scholarships then and both are now employed. [xyz-ihs snippet="Mobile-Subscribe"] My last civilian job was working as an accountant for a company that printed magazines. Well, paper and ink had a good 2,000-year run, but that has been rapidly ending with the invention of the internet. The company had been dying a slow, painful death. That’s just the way it was. Many jobs were done away with over the years. But that was not the case with me. I watched folks above and below me get pink slips. Then their work would fall on my desk. I seemed to have had two important attributes: I could get the job done and I was a bargain. I never got paid overtime because I was salaried, and yet I did endless overtime. All the overtime and stress at a company that appeared to be on the road to bankruptcy was affecting my health, with high blood pressure and other medical problems. But I just couldn’t seem to pull the trigger and retire. The plan was to bank my military retirement checks and work until at least age 65. Then one Sunday, which was routine for me, I was at the plant and a supervisor I knew came by my desk. We got to talking about retirement. I mentioned that I could retire if I wanted to. I had run the figures once, and then had a financial advisor see if he agreed. He did. My friend looked at me in astonishment and said, “Ken, why are you here on a Sunday if you can retire? This isn’t a dress rehearsal for life. This is it. You don’t get a second chance.” He was right. If you enjoy what you’re doing, then by all means continue to work. It will probably extend your life a lot more than retiring. But if you have the means to retire and you really don’t like what you’re doing, it’s time to go. The extra money you make might not pay for the medical bills that could result from your decision to stay. You only have a limited number of years in what I call your “life bank.” Don’t spend most of this bank account doing something you don’t want to do. Retirement worked for us. Our marriage got stronger by bringing down our family stress level. I do all the housecleaning, laundry, dishes, mowing, grocery shopping and 1,000 other little tasks around the house. Cindy trusts me with everything but cooking. Smart girl. All Cindy has to do is commute two miles to work and come home in the evening. Also, we eat out a lot. Smart boy. Sometimes, retirement is the best answer. Ken Begley has worked for the IRS and as an accountant, a college director of student financial aid and a newspaper columnist, and he also spent 42 years on active and reserve service with the U.S. Navy and Army. Now retired, Ken likes to spend his time with his family, especially his grandchildren, and as a volunteer with Kentucky's Marion County Veterans Honor Guard performing last rites at military funerals, including more than 350 during the past three years. Check out Ken's earlier articles. [xyz-ihs snippet="Donate"]