Wednesday, August 26, 2009

It's All About the Coins

I performed that old familiar money ritual again. I opened my Superman bank (Motto: “Saving money is Powerful!”) and counted the coins. This is the ritual that so many of us find ourselves performing when our finances are suddenly uncomfortable. We check under the couch cushions, in the crevices of the car, and of course, we eye that huge bottle, jar, or actual pig-shaped container into which we usually throw all our change.

We put change in these banks for two reasons: 1. It is not cool to pay with exact change. Supposedly, only fussy old ladies do it, and no matter how fussy we secretly are, we don’t want to look fussy. We want to look cool and careless with money. 2. We formed the habit as children of keeping our extra cash in a container we could look at to see our wealth increasing, or shake to hear the lovely sound of coins clanging against each other. Reason #3 is a guy thing, but it’s actually just a subset of #1: Not wanting to ruin pants pockets fast by constantly loading them with change. Which cycles back to reason #1 again, because they sell change purses for men, those half-moon-shaped leather things that unfold with a little tray for your coins to be displayed. But supposedly, only fussy men, men who probably wear socks with sandals, carry those. Catch-22.

Anyway. A somewhat large, unexpected expense came up recently. (I should be expecting these by now, shouldn’t I? Didn’t I have an unexpected expense about a year ago?) Unfortunately, I find that cash is a bit tight this month (welcome to the club, right?), but I need to spend this money immediately. Even more unfortunately, I discovered that my rainy day savings, carefully laddered as the finance gurus have suggested, are months from being available without taking a major penalty hit. Ouch. When those CDs open, I’m going to change my strategy. Meanwhile, no way am I going to take a penalty to get my own money. I’d rather pay (less) to use someone else’s.

So I have been searching for the best option. Take money from an IRA? That adds to my taxable income for the year (and for some people would also mean an automatic 10% penalty), and I would rather not. Plus, anything I have invested in stocks, while certainly more liquid than a bank CD, I prefer to keep in the recovering market. It’s nice to see the values of stocks going up, but they aren’t back to where they were last year. No, I plan to leave my stocks alone.

Credit cards? Not the best time to be playing with them, but still, better than getting an unsecured bank loan at 15% or more. Or going through all the rigmarole to open a home equity line of credit, when there are penalties for not using at least $30,000 of it. That’s way too rich for my blood, and completely unnecessary when the issue is cash flow, not lack of funds. (Even as I write this, I have contracted to do a freelance gig that will more than pay for the loan I need to take out. It’s all a matter of timing.)

I was disappointed to learn that Chase has decided not to do those lovely, cheap wire transfer loans anymore such as I took out last year for a mere 3% fee and once before, entirely free. Everybody’s cash advances seemed to be at 19.99%. Yikes. I ended up examining the credit card statement junk inserts that arrive each month, comparing the language and the fine print on the offers accompanying “convenience checks” and “balance transfer checks.” And trying to figure out if they are one and the same thing. Which it turns out they are not. A convenience check, unless it is otherwise stated, is a regular cash advance, and thus is going to incur a cash advance finance charge rate (in this case, 19.99%) and might also include a transaction fee of several percent (in this case, 4%). Not what I want. Eventually, I found a good enough deal from Citi, a balance transfer with a 1.99% finance charge plus a 3% transaction fee. It also has the advantage of not involving me in excess transactions such as starting a new credit card account just to get a super low rate. I only need the loan for a very short term. (I could have tried a loan shark, but the rates wouldn’t be good. And I couldn’t do a payday loan, lousy as their rates are, because I am not an employee. I wouldn’t even consider a car title loan; again, lousy rates. Even as volatile as credit cards currently are, they remain less dicey than these choices.)

Imagine my surprise when, having gone through all my options, researched the details, and settled on a satisfactory plan, I suddenly found myself wanting to count the money in my Superman bank. I even got out my stash of coin wrappers and packaged up the coins. And then put them back in the bank. There is just something about cash. To the visceral child in me, coins represent cash even more strongly than bills do. Asking myself why, I realized that as a child, I seldom had any dollar bills in my possession. A nickel, dime, or quarter was exciting. On some level, this childhood valuation of money still has resonance, still connects to my financial life as an adult. And maybe I’m not alone. Maybe that is the real reason #3, why so many of us keep jars, bottles, pigs, and even superheroes filled with coins. Coins symbolize wealth. They have heft and character. They shine. They clang. I know that for some people it’s all about the Benjamins. But to me, it’s all about the coins.


EilisFlynn said...

You know, you could probably put that Superman bank on eBay to start another rainy-day fund ...

I pay exact change whenever possible for a simple reason: I know the people who work in the stores I go into, and I also know when they're most likely to need things like change and small bills. We have containers of change at home, and I guess I could just add to them, but those clerks need the change and I sure wouldn't want to have those jobs. (There's a reason I have an office job, far away from customers.) It helps them a little, and it helps me not having to carry change and aggravate the neck arthritis.

Anonymous said...

Coins are underrated. I've managed to buy a large TV, and float my day to day expenses for weeks on end on what coins I've managed to save. Susie Orman has changed her advice on how to handle credit cards. Now it is pay the minimum and build a larger cash hoard.