HELOCs to pay for gas?

A friend shared this picture on Facebook and I got a nice chuckle from it. Chances are everyone has made similar jokes about getting loans for certain day to day items but still it is pretty funny.

It also reminds us that no matter how much planning we do there will be certain costs that get away from us. Something like the price at the pump seems like an obvious candidate although this can be mitigated somewhat.

I'm not one who thinks it makes sense to buy a new car to save some number of dollars at the pump. I think reducing this expense might be more efficiently achieved by planning the week out a little better to try to reduce drive time. Then maybe when a vehicle needs to be replaced, go more economical at that time.

While a little ingenuity might be able to help minimize actually paying out an extra $200 per month for gas, this may not be the case with health costs. A large and annual increase in insurance premiums, as one example, may not be so easily mitigated.

Some expenses go down in retirement but those will likely be finite. If you have a $1500 mortgage then once you pay that off you stop making a $1500 payment. This year we are paying $331/month for a high deductible HSA. Since we've had this plan our premium has gone up 10-20% per year and in my opinion there can be no certainty the future increases won't be larger which makes future planning for this expense very difficult.

On one of my posts on Seeking Alpha a recently retired reader commented that retirement isn't quite as expensive as financial professionals tend to convey. I am not retired and he is which does carry some weight. My observations and general industry thought is that in early retirement the tendency is to spend more on things like travel and toys. At some point the travel slows down and there is then less spending and then the spending increases again for later stage health care.

It should be obvious that everyone's own circumstances are unique but some variation of the above is common. Embedded in the one comment about retirement being cheaper than planners tell you is the potential conflict that exists in that it is in most planners' interests for clients to save a lot and spend a little. I can't say this does not exist but I think most of the audience here is comprised of do-it-yourselfers.

The best thing is to run your own numbers, think about your own costs, vulnerabilities to your own financial situation--for example the threat of a large vet bill is one for us. A $1500 vet bill combined with getting caught off guard with needing new tires could make for a problematic month for many people. My own set of life experiences and biases leave me wanting to make a priority of not getting caught off guard financially. The simplest starting point I can think of is reducing the overhead IE minimizing the expenses.

On another note, I am thrilled about the impending start to the NCAA Basketball Tournament. In addition to rooting for San Diego State (my alma mater) I will be rooting the South Dakota State Jackrabbits, the other SDSU and Long Beach State along with most of the underdogs from game to game.

For whatever reason I still dislike any variation of the word dance when used in connection with the tournament. Amusingly I watched the McNeese State/Lamar game the other day Derek Wittenburg, yes that Derek Wittenberg, was the analyst for the game and must have used the word dance or dancing 91 times. Obviously he knows more than most of us about the NCAA Tournament but still...enjoy the games.