You can pray to Abaddon all you want. He’s not listening.

The previous Secretary of the Treasury, Hank Paulson, got our vote as the most corrupt, incompetent, unethical man ever to hold the position. Yet as low as he set the limbo bar, his successor cleared it with inches to spare. Tim Geithner has done more than any single man to prolong an economic miasma that walks like a depression, talks like a depression, yet is never officially referred to as such. After 6 years of low employment, stagnant wages, and ever-increasing sectors of the economy being handed over to the state, the word “recession” is euphemistic.

Even before Geithner’s 1st day on the job, he’d “neglected to pay” $35,000 in taxes. This didn’t come up before the confirmation hearings, and the taxes presumably would have stayed unpaid had he not been the person deemed most qualified for the job. His solution? Pay the taxes plus a 42% penalty. Big deal, it’s only money, and thus he let his personal financial situation serve as an apt omen for the nation.

The $35,000 is a ten-millionth of the amount Geithner was entrusted with as his share of the bank bailout (see Paulson, H.) Geithner handed said taxpayer funds over to the banks with the biggest influence in the White House and on Capitol Hill, but only on the laughably weak condition that said banks spend a few million less in executive bonuses than they otherwise might have. But hey, AIG paid all the money back:

AIG disabled comments on this video – we can’t imagine why – but you can look at the number of likes and dislikes for an idea of how the commercial and AIG’s reputation are resonating with the American people.

Wouldn’t it have been easier to just run 60 seconds of a cufflinked hand flipping the bird to the viewers?

One good thing about Geithner, he helped gauged the indolence of the American people. If Americans can’t rally in the streets and seek literal blood after he and his cohorts shamelessly and gleefully lengthened the depression, then there’s no telling how pliant we’ve become. If the new Secretary of the Treasury is anyone other than this guy,

America’s Greatest Hero

expect more of the same.

Depressed yet? Welcome to another Carnival of Wealth. Some good personal finance blog posts, some awful ones. We do it every Monday, weather permitting. Let’s see what we’ve got:

Harry Campbell at Your PF Pro recommends against front-loading your 401(k). You might lose matching funds if you reach your annual maximum with plenty of year left to spare.

We’ll indulge her, but the woman who calls herself “Mochi & Macarons” is taking this pseudonym thing a little too far. Heck, even “Sam” Wes “Dogen” at Financial Samurai chose an actual human name to hide behind. What’s she afraid of, anyway? Anyhow, she writes at something called The Budgeting Tool, and we only wish we’d thought of that as a nickname for Trent Hamm at The Simple Dollar. Mochi & Macarons (screw it, we’re calling her Diane) argues that being single is more expensive than being married.

First, tell that to Tiger Woods, Rupert Murdoch, Michael Jordan, Paul McCartney, Craig McCaw, Mel Gibson or Garth Brooks. Second, we’d tell you more about what Diane had to say but the barrage of font colors and sizes on her site made our heads hurt.

Speaking of pseudonyms, “Bill Smith” at 2013 Taxes explains how the IRS has delayed the start date for electronic filing. It’s now this coming Wednesday, which is 8 days later than usual. This shouldn’t concern you, because you should be paying your taxes at 11:59 p.m. on April 15. In fact, you should mail your taxes from Pago Pago just to keep Uncle Sam out of your pocket for a few additional hours.

Here’s an example of the kind of useless post we include only to make fun of. From Carmen at My Best Car Insurance 101,

Every driver has to have car insurance and no one likes paying more to insurance companies than they must, especially when you can find cheap quotes online.

That’s garbage. Don’t waste our time with your repetition of the obvious. This post also includes half a dozen instances of our least favorite word, “consider”, as in:

Any driver with a car loan should consider carrying GAP insurance

Don’t tell us to “consider” doing something. Either tell us to do it, or don’t. To wit: “Consider smoking less.” That was easy, wasn’t it? The considering, we mean. It takes a matter of seconds and it doesn’t change a thing. “Consider” is a weak, ineffective word used by dullwits and the uncommitted. At least have the strength of your own opinions.

Holy crap, there’s an accredited university teaching personal finance? There is, and it’s the University of Kentucky. John Kiernan at Card Hub explains this major development in education. While the schools that teach music appreciation still outnumber the ones that explain how to build wealth, it’s a start. John also includes one of the most unintentionally funny lines in CoW history, after pointing out that Kentucky ranks 46th in the nation in financial literacy:

Kentuckians are more financially savvy than residents of states like Arkansas, Mississippi, Louisiana, and West Virginia

From Odysseas Papadimitriou at Wallet Blog, the skinny on private-label corporate bonds, a/k/a floating-rate demand notes. Offering returns that dwarf those of 5-year CDs, these are nothing more than debt marketed by major corporations. The downside is that you can sell them only back to the company you bought them from.

Darwin of Darwin’s Money explains how he negotiated 10% off the price of hundreds of dollars of flooring, just by throwing irrefutable logic at the Home Depot clerk and his manager.

The remarkably similar Dan at ETF Base lists the 8 largest exchange-traded funds on the planet, how much they have under management, and what kind of expense ratios they charge.

(Something from My Life Insurance Quotes 101, cousin to My Best Car Insurance 101. Should we lambaste it? Nah, whoever’s behind it has already suffered enough today.)

But if we are going to lambaste someone, we regret that the opportunity to do so to a cherished CoW submitter has presented itself. (This ties in to what we were saying earlier about the word “consider.” Hear us out.) From Louis Garner at Wallet Hub, a tip on how to save money on alcohol:

I’m not going to tell you to stop drinking…it’s naïve to think people won’t inevitably buy alcohol. Instead, I merely want to help you save as much as possible in this major spending category.

How about “I’m not going to tell you not to stop smoking…it’s naïve to think people won’t inevitably do something so obviously detrimental to their health. Instead, I merely want to help you incur as mild a form of emphysema as possible.” Same freaking thing. Louis starts his piece by positing that we’re a nation of negative-worth debtors, then explains how to spend money on something that’s always a luxury.

Castelmavre: “This is a producer that’s reasonably widely available. Vintage after vintage is outstanding, and a bottle only runs $13-$15.”

It does? Then we just discovered an easy way to stop $13-$15 from leaving your wallet. This isn’t hard, gang. Either justify your frivolous expenses, or stop making them.

Will at Card Guys employed the services of our favorite hack blogger, journalistically trained Miranda Marquit, to emphasize his points about how to save money by…budgeting!

With a traditional budget, you add up all of your income, and you add up all of your expenses.

And on and on it drones through umpteen paragraphs. (Do people still say “umpteen”? Upon further review, we got that from a Donald Duck cartoon that was released probably 70 years ago.)

Carefully think about your current financial situation, and decide what type of spending plan or budget is most likely to work for you.

Probably a nice gal, but Sweet Jesus she’s awful.

We’re due for somebody good. “Good” means interesting, unique, worth reading because the post comes with a tangible benefit. Like this one from Amanda at My Dollar Plan, who explains when you might have to file a tax return even if someone claimed you as a dependent.

Even reading a clear, informative explanation of a tiny part of the tax code makes our heads spin. For instance, if a church (“or qualified church-controlled organization that is exempt from employer social security and Medicare taxes”) paid you at least $108.28, you might have to file. Ditto (Do people still say “ditto”? Ah hell) if your gross income is more than the larger of $950 or [earned income + $300.] But yes, let’s continue to make the tax code more complex with every passing year. The Chinese will bow down to our formidable bureaucratic power.

The remarkable Paula Pant at Afford Anything returns with a moral tale about assumptions. The Atlanta-based landlady had to eat several months’ worth of potential rent payments because of an oversight any one of us would have made.

Michael at Kitces.com, America’s youngest bridge player, explains the benefits that can accrue for getting your mortgage at the Bank of Mom and Dad. He doesn’t mean a handout. He means a formal loan that skirts the lending requirements of America’s financial establishment. Until the federal government starts regulating parental loans, which sounds inconceivable and absurd until you remember that the Department of Agriculture once sued a farmer for growing his own wheat (because that meant he “unfairly” didn’t buy any, and thus he affected interstate commerce.)

One of the paradoxical laws of blogging is that the non-native English speakers usually have a better command of the language than the alleged anglophones. Pauline Paquin at Reach Financial Independence is in the former category. She explains how to give to charity while still taking care of business at home. Pauline is unapologetically in debt, and with good reason – to finance real estate investments, not to travel the world, although she’s doing that too. And she’s carrying zero consumer debt (big difference between that and a mortgage, and if you don’t know that, click here.)

Dividend Growth Investor is loading up on ConocoPhillips, which is paying giant dividends and trading at barely 8 times earnings. He likes it so much he’s not only bought it, but replaced Exxon Mobil with it in his portfolio.

Big finish. The brilliant Jason at Hull Financial Planning explains the logic behind and likely result of the Jumpstart Our Business Startups Act, and again we wish our elected representatives were as committed to reducing the debt as they are to creating clever acronyms. The new law basically makes crowdfunding easier. Let’s just say Jason doesn’t give the idea his full enthusiasm. In fact, we thought he was likening it to gambling even before he made a blatant Las Vegas comparison in the piece’s final line. If you visit Control Your Cash purely for entertainment, check Jason out. He’s perceptive and funny.

As is PKamp3 at DQYDJ.net, but you knew that already. This week he lists all 50 states (and 1 federal district) by a telling metric – net federal benefits per capita. Hawai’i is the biggest net teat-sucker in the nation, or would be if D.C. didn’t exist. In fact, the District is so far ahead of any state that it requires a logarithmic scale to fit our nation’s capital on the same graph as everyone else.

Suba Iyer at Wealth Informatics says there are 9 reasons (at least) why you aren’t making more money. Her suggestions are not only all valid, but come with their own counterarguments. Nos. 5 and 7 are particularly discouraging. But hey, more opportunity for the rest of us when the people who love to justify their poverty continue to do so.

Finally, Andrew at 101 Centavos introduced us to “Stupid Labeling Tricks”. If you’re the kind of person who doesn’t want rBGH in her goat milk derivatives, this post is for you. And if you don’t know what the acronym stands for, or why the underlying substance has such a bad rap, maybe you should find more important things to do than protect yourself and your sensitive family from non-existent threats.)

(Side note: Your humble blogger went to his local REI outdoor store a couple years ago to get a water bottle. Some of the ones on hand were advertised as “BPA-free”, incorporating an acronym never heard before. It didn’t matter what BPA was, or how many parts of it per trillion it would take to compromise someone’s health, the manufacturers still found the absence of BPA compelling enough to advertise it to a gullible public. They might as well have said the bottles were “fat-free” or “unleaded.”)

Thanks again for joining us. New post Wednesday. Another new one Friday. Anti-tip every day of the week. Goodnight now.

Our favorite line about this ridiculous story:
“The last Punahou High School graduate with a made-up girlfriend ended up becoming President.”
Here’s a picture of her. Yes, she’s white.

Last week, we presented the Hawai’ians Are Ignorami Edition of the Carnival of Wealth. This week, one of Hawai’i’s most famous sons got caught creating (and abruptly murdering) an imaginary girlfriend. Which he followed up by telling doleful stories of “their” relationship, without mentioning nor offering nor being asked to offer photographic or any other kind of evidence of her existence. Yet any college football player, let alone a Heisman Trophy finalist, should be awash in vagina from the moment he sets foot on campus for his first recruiting visit. Assuming he wants to be, that is.

The only people dumber than Hawai’ians are journalists, and we’re not even talking about the ones who blindly and breathtakingly reported on the poor nonexistent woman’s demise. We’re talking about the ones who still, after the fact, ask questions like “Was Manti Te’o in on the hoax? Or was he an innocent dupe?” As if there could be any doubt.

So yeah, mildly closeted (or colossally bored) football player reinforces the stereotype we brought to your attention last week. Let’s see if any of this week’s Carnival of Wealth submissions are dumber than Manti Te’o:

Certainly not this first one from Will at Card Guys, who makes a bold but clear suggestion: spend with your credit card. Don’t freeze it in a block of ice, or give it to your golden retriever to bury in the back yard, or whatever else the leading personal finance blogging simpletons are telling you to do this week. Put as much as possible on your card. Why? Why not? You have to pay your mortgage or parking or grocery bill anyway, so why not earn some rewards for no incremental effort? Unless you like carrying fistfuls of cash and writing checks, in which case it’s 1955 and how are you reading this without a computer?

After a brief sojourn, Ken Faulkenberry at AAAMP Blog returns with a piece on Benjamin Graham. If you’re not familiar, the late Graham (he really did exist, there’s a death certificate and everything) was Warren Buffett’s investing mentor. Graham used a figment of his imagination, “Mr. Market”, as the protagonist in a parable about value investing. Graham never let the fiction go beyond that point, resisting the temptation to create a backstory that involved Mr. Market’s college or any fatal diseases. To quote Ken,

If every investor did their research and only bought stocks with a margin of safety below the intrinsic value of the company, the market would be efficient and fairly stable.

Of course it isn’t, and why? Because people typically invest with something other than their brains. Be aggressive when everyone else is pessimistic, and cautious when they’re optimistic, and you’ll probably come out ahead.

Suba Iyer of Wealth Informatics gets her drugs cheaply, and does so without claiming indigence nor being Canadian. Instead, she…well, if we told you you wouldn’t read her post. Also, her post features one of the few good comments in the history of the internet.

Andrew at 101 Centavos is so lucky – he gets to travel the world! (Just like some other people are lucky in that they get to build useless emergency funds and spend years paying off their credit card balances.) No, Andrew just prioritizes. This week, a dispatch from Malaysia and/or China. Want to live in one nation or the other, or somewhere in between? Andrew explains the reasons for and against.

At press time, only a handful of states don’t levy an income tax (you can be damn sure the CYC principals live in one). But with Washington, D.C. throwing stalemate on top of impasse and mixing in some gridlock for good measure, several states are looking at eliminating their income taxes and replacing them with (or increasing their extant) sales taxes. Bill Smith at 2012Tax.org explains which states are doing this and why.

Taxing consumption is better than taxing income. Every dollar of income has to be either spent or saved, so if you tax consumption, you’re encouraging people to save. When your nation has a negative savings rate, as the United States does, then an incentive to save (e.g. a sales tax) is practically a necessity.

“The back bacon fell off my cutlery and onto my runners, so I grabbed a serviette.”

Or translating into American,

“The Canadian bacon fell off my silverware and onto my sneakers, so I grabbed a napkin.”

Kyle at My University Money introduces another word from the Canadian lexicon, “residence”. Or as American college students call it, “the dorm”. Heck, even “university” is a Canadianism, used where regular folks say “college”. Schools on either side of the 49^th have noticed that not only can they name their own prices for tuition, they can do the same with room and board. Kyle tells you how to avoid paying too much. (We’d recommend that you forget about a degree and go to trade school anyway, but what do we know about money?)

This is either a CoW rookie, or we haven’t been diligent in remembering who’s already submitted and who hasn’t. No, it must be the former. We would have remembered someone this good, as any guy who uses words like “emeriti” and “appurtenant” is alright by us.  Jason Hull at Hull Financial Planning explains what’s in store for the person who jumps off the wage treadmill and starts his own business. The first few weeks/months/maybe even longer will be a challenge, and even once you’re successful there’s still a temptation to never take a break, seeing as you become both financially and emotionally invested in a business that bears your name. Still, as far as we’re concerned that remains a better deal than working for the man.

It took a while, but new submitters are finally helping to shove the garbage submitters out the door. Michael at Kitces.com returns with an analysis of the estate tax exemption. Thanks to the laughably titled American Taxpayer Relief Act of 2012 (the roadblock hastily hammered a few inches from the “fiscal cliff”), you can hide up to $10½ million in estate taxes from the IRS, as long as you die and leave everything to your spouse. The exemption is indexed to inflation, too, something the brain trust behind the Alternative Minimum Tax never thought of. Long story short, Michael has determined that you probably no longer need a bypass tust. However, you still need a tax accountant, as the CYC Diagonal Tax ($x exemption, y% on the remainder, lock Congress in a room until they reach a consensus on what values those variables should take) has yet to be adopted.

Contrary to what you might think, Dividend Growth Investor doesn’t buy-and-hold-for-eternity. Even though he concentrates on stocks that provide a consistent income, he’ll still unload a dividend stock once in a while. For instance, if it cuts its dividend. See what his criteria are and why he replaced his Con Ed stock with that of a natural gas master limited partnership that you’ve probably never heard of.

Another rookie: some chick in Calgary homeschools her kids, because they have ADD and were getting bullied in regular school. “Bullying” used to mean physical violence, but these days it can mean someone failing to invite a classmate to an Earth Day party: no word on which kind of bullying is going on in the Calgary school system. Anyhow, she writes on Canadian Budget Binder about how she does it. The blog’s About page says that the site also features advice on coupons and frugal recipes, so don’t expect it to become a CoW regular.

Harry Campbell at Your PF Pro explains what “Restaurant Week” is, why it’s a waste of money, and whether you need to live in San Diego to understand what he’s talking about.

The magnificent Neal Frankle at Wealth Pilgrim can move effortlessly from nuts-and-bolts advice (he is a Certified Financial Planner™, after all) to more visceral, inspirational stuff. This week, he lists the reasons why it’s so hard for many people to make lasting financial change. One big culprit is data overload:

Make yourself a promise that you are going to spend no more than 1 hour a day for 2 weeks researching your problem.

Harder than it sounds.

Where’s the drivel this week? It’s one good post after another. PKamp3 at DQYDJ.net explains a heretofore unpublicized “benefit” to Obamacare (you know, that overarching law that swung on 3 votes in the House, ended up costing 42 Representatives who voted for it their jobs, and was upheld by a single vote in the Supreme Court.) Your Health Savings Account might only be valid until the end of the year, at which point the Department of Health and Human Services could indirectly render it obsolete. Meanwhile, we’re still trying to figure out how an individual’s health care – almost by definition, the most personal service in the world – became a public good in the first place.

Mich at Beating the Index is another prodigal returnee. The maven of the Canadian energy industry introduces us to Bonterra, a light oil producer that a) recently bought a competitor and b) not only pays a dividend, but has increased it in 4 consecutive years.

Last week Michael at Financial Ramblings explained how to get the best of both worlds by splitting your IRA contributions between a traditional and a Roth. This week, he tells you what to do when said Roth reaches its income limits.

Charles Davis at Wallet Hub is the rare academic who toils in the real world. He explains how if you’re shopping for a house, Federal Housing Administration loan requirements have changed. Changed, as in “tightened”. But if you have a modest net worth, an FHA loan is probably still your best method for getting into a home of your own and out of some landlord’s revenue column.

Over at Wallet Hub’s cousin, Wallet Blog, Lynn B. Johnson (not to be confused with the chick who writes that awful comic strip) gives us the kind of opening line that a only a seasoned CoW submitter can get away with:

My husband and I are typical of a lot of married Americans: we both have student loans and I lost my job last year.

But how can that be? A college education is a guaranteed path to an increased income! Everyone says so! Anyhow, Lynn B. managed to find a repayment program suitable for a jobless lady. She has 25 years to pay her loan off! In other words, most of a working career. Yup, a university degree (presumably in something other than the hard sciences.) There’s nothing like it.

Finally, from Liana Arnold at Card Hub (another cousin), details of the Dodd-Frank whistleblower program. If you catch your boss violating federal securities law, you can get up to 30% of any sanctions levied. (Note: Clean out your cubicle before trying this.) Or just don’t for someone else in the first place. See Jason Hull, above.

And just like that, it was over. Join us again Wednesday for a stunning new post (and tomorrow for the Anti-Tip of the Day.) Ciao.

Virginia’s most famous native son? Thomas Jefferson. Hawai’i’s most famous? This 800-pounder, who did manage to live to 38. And had a wife and a kid, if you can believe that.

If you’re the kind of cultured Northeasterner who finds nothing funnier than making fun of people from, say, Alabama and how stupid they are, spend a couple of days in Hawai’i and see how quickly you reassess your hierarchy of dumb.

Adam Carolla was right. Hawai’ians are stupid for several reasons, a major one being that the islands are only so big. And so isolated. The unavoidable inbreeding puts the royal houses of Europe to shame. Also, the Hawai’ian alphabet has only 12 letters, making it impossible to articulate any abstract or higher-level thoughts.

Here’s an example of how dumb Hawai’ians are. The Hawai’ian word for “half” is hapa, which is obviously a corruption of the English word. There’s no f sound in Hawai’ian, so they went with the closest substitute they had available, p. Every Hawai’ian word has to end in a vowel, hence hapa. Now…

The islands were discovered around 600. Captain Cook didn’t show up until 1778. These people went 1200 years (and presumably would have gone longer) without anyone ever saying, “I just split this thing in two, and now I need a name for each piece.”

For those of you in the rest of the world, who can read, we present yet another edition of the Carnival of Wealth. Personal finance wisdom (and occasionally, what only Hawai’ians might consider wisdom) from our favorite bloggers. Shall we?

Madison du Paix at My Dollar Plan submitted her post 3 seconds after last week’s carnival went live, and seeing as we no longer have a formal deadline, it’s only fair that she go first. Madison writes about the (groan) “fiscal cliff”, the most preposterous scaremongering story to hit our national consciousness since Orson Welles convinced some dullards that Martians were colonizing our planet. (Remarkably, some of the dullards lived on the Mainland.) There was no “cliff”, metaphorical or otherwise, that our economy was going to go over. Although it was preposterous that our elected superiors gave us barely 2 days’ notice as to what our 2013 tax rates would be. Said superiors will continue to spend money we not only don’t have but will never have the creditworthiness to borrow. They’ll continue to raise taxes. Our economy will remain stagnant. But boy, that Sophisticate-in-Chief is a charmer. And our incoming House members and Senators? So enlightened and diverse! More ladies (and Buddhists, and bisexuals) than ever! Remember, their identities and personae are far more important than what they’re pitching.

Oh yeah, Madison’s post. She summarizes – quite beautifully – what the fiscal cliff deal means for our taxes.

The Control Your Cash Woman of the Year makes her awaited return to these parts. When the year began, Paula Pant of Afford Anything and her boyfriend wanted to see if they could live on one income. Not because she wanted to sit at home and eat bonbons while crafting tea cozies to sell on Etsy, but because she wanted to take one of their incomes (hers) and invest every farthing of it. Paula did – well, the two of them did – and she gives the results.

This is why we named her our Woman of the Year, and why the balloting was not close. Paula does not come from exorbitant means. Yet she’s in her 20s and is not only deriving much of her income from investments, she’s doing it while living a rich and fascinating life. She’s visited more countries than all of you combined. She has the freedom most of you dream of only in theory, and will spend all day justifying why it’s impossible to achieve in practice. Yet she’s doing it and will continue to.

Even more remarkably, she’s not one of these obsessive cheapskates who vacations exclusively in adjacent counties and collects notable rocks while doing so. She doesn’t merely have freedom, she capitalizes on it. We should all live like Paula. But no, keep slaving away at that job you hate in the hopes that a few years down the road, you can get promoted and commit even more of your finite existence to said job.

Suba Iyer from Wealth Informatics? Where has she been? (Note her name – well, her maiden name – at the top of our main page.) Today we found out that she’s spent…$95,000 on rent for the last 5 years. The definitive spicy meatball. In some places that kind of money will buy you a decent house, not all of them Detroit neighborhoods. She negotiated a lower monthly obligation, which isn’t quite as good as buying, but it’s far better than paying too much rent.

Free Money Finance has case studies of 2 people who quit their jobs and lived to prosper. (Here are a couple more.)

The ever-mysterious Dividend Growth Investor gives his response to the “fiscal cliff”. He feels that such ephemeral concerns are meaningless when his holding period is, and we quote, “forever”. Man, he’s not kidding about preferring dividends over appreciation. Again, D.G. Investor gives his handy capsules of some of the obscure companies that he invests in:

The Coca-Cola Company (KO), a beverage company, engages in the manufacture, marketing, and sale of nonalcoholic beverages worldwide.

From PKamp3 at DQYDJ.net (that’s Don’t Quit Your Day Job, ICYDK) comes a fantastic recurring feature: he and the rest of his brain trust use option prices to determine where the S&P 500 is going to end up. Last time, their predictions failed egregiously. But like Thomas Edison figuring out ways not to create an incandescent light bulb, the DQYDJ team has taken its failure and made something of it.

Jake Thompson at Becoming Your Own Bank is relentless, if nothing else. Long story short, his site is a commercial for the family business – not just life insurance, but whole life insurance, which is the worst kind. His post does give us an opportunity to offer up some handy grammar tips:

• Possessives take an apostrophe, plurals don’t.
• “Buy” is a synonym for “purchase”. “By” is something different.
• “Peace of mind” is an idiom meaning contentment, satisfaction. “Piece of mind” is an Iron Maiden album (and they were well aware of the homonym when they gave it that title, thanks.) Seriously, you have difficulty with this?

Also, while Jake’s post is undated, there’s a comment on it that’s dated 4 months ago. So thanks for giving us something timely, Ace. And even though we long ago lambasted the family patriarch’s book on whole life insurance, which is written even more ineptly than this whale patty of a blog post, the Thompsons still submit to the CoW. Good for them. Kids, banging your head against a wall repeatedly is crucial to your success in the real world. Especially if you supplement it with whole life insurance.

Let’s shower and rinse after that, and welcome Neal Frankle of Wealth Pilgrim back to the CoW. Neal received an all-encompassing and unbelievably general question from a reader – essentially, “How do I invest?” Obviously that requires a long and detailed answer which includes its own set of questions, but  Neal manages to be both succinct and helpful in his response.

From Michael at Kitces.com, an analysis of more of the doublespeak and obscurantism surrounding the American Taxpayer Relief Act of 2012. If you’re retired, you can make a Qualified Charitable Distribution from an IRA. Remember, you’re not doing this to guarantee your place in heaven, but rather to limit any tax bite. One problem – the law wasn’t passed until after the 2012 tax year ended. What’s better than a Congress that not only doesn’t let its citizens know the tax schedule for the upcoming year, but keeps the previous year’s hidden too? Michael concludes that QCDs are largely a waste of time anyway, and that if you really want to give to charity and not the IRS, you should donate stocks that appreciated. Once again, Michael does some brilliant and vital if depressing work about what our taxes are going to look like over the next few lean years.

Andrew at 101 Centavos has an outlook similar to ours on the absurdity of the fiscal cliff.  Andrew did the filthy but vital work of digging to see which companies and industries your elected representatives have chosen to be the winners and losers this time out. Wind energy gets yet another chance to pretend to be profitable, government ward General Electric gets to defer taxes. Andrew explains it in his inimitable way:

Calling the office of national politicians, also a pointless exercise for an individual peasant voter. Like leveling up in a video game, it’s a short-term false accomplishment. There, got my “voice” heard.

Trent Lott was a Republican. John Breaux, a Democrat. And yet here they are hand-in-hand, working for the same lobbying outfit. Might even shower together at the same gym, for all we know.

Andrew doesn’t just complain, though. He tells ordinary, non-connected folk what they can do to minimize the damage and be less poor in the coming years, which is the pusillanimous 21st century version of what used to be the American Dream.

You people could’ve nominated Ron Paul for the presidency, the one guy with enough guts to point out the rapidly falling sky. But no, he’s crazy.

Yes. Teacher Man at Young & Thrifty asks if you should get a Costco membership. We did this 3 years ago, but the lessons still apply. Teacher Man lists some disadvantages to shopping at Costco, one of which isn’t valid at all:

You really can’t walk out of there without spending at least $75 to $100

(He means “at least $75”, or possibly “at least $100”, but he can’t mean both.)

You’re not supposed to walk out of there without spending at least $75. (Or $100.) It’s called bulk shopping. Your humble bloggers dropped $206 at the nearby Costco today in fact, and can now go the next 6 weeks without buying eggs, or mahi mahi, or chicken, or bacon, or cat litter. And of course, the thrilling conclusion:

Readers, do you think Costco is worth it or not?

(groan)

Have a Roth IRA and a traditional one? Michael at Financial Ramblings says that’s the way to go, arguing that if you contribute to a Roth up to the amount where you don’t have to pay any taxes on withdrawals ($19,500 in his example), and put the remainder of your contributions in a traditional IRA, you’ll lower your tax liability as much as possible.

Needs editing, but here’s another debut CoW entry – this one from James at Free in 10 Years. James offers data to buttress the argument that impulse buying is a legitimate phenomenon. Did you know people buy more convertibles when it’s unseasonably warm? And more 4-wheel drive vehicles when it’s snowy? James also recommends that you “plan purchases in advance”, which is a much better idea than planning them retroactively.

Charles Davis at Wallet Hub explains how mortgage points work, and does so clearly and concisely. If you’re not familiar, mortgage points are a means for saving money by paying up front instead of deferring over decades. Pay 1% of your mortgage balance immediately, and it might knock ¼ or ½ of a percentage, uh, …point off your interest rate. Despite their confusing name, mortgage points are useful to both borrowers and lenders. Charles illustrates how mortgage points work in more detail than we have time for here.

Finally, Liana Arnold from Card Hub has returned from her brief incapacitation to give us the credit card landscape report. Which is…? Glad you asked. She shows how annual percentage rates, introductory rates etc. have moved over the past 3 months. The data are fascinating (reward bonuses have increased 15%?) and go back several years.

Thanks again for reading. Buy our book. Check us out on Investopedia. And don’t do drugs. Aloha.