The cost of dying

Hello world. Sorry I've been so quiet; balancing apartment-buying (eeek) and work is brain-and-time consuming. The real-estate adventure has yielded a ton of blog material, but I feel like I need to sit on a fair bit of it until the closing contracts are actually signed and stuff can't suddenly go awry -- which it has been on a fairly regular schedule. So I'm stockpiling material and planning lots of updates in a month ...

Meanwhile, I wanted to drop in a link to one of the best magazines pieces I've read in years: "Lessons of a $618,616 Death," this week's BusinessWeek cover story. (The cover itself is also breathtaking, with its fade-to-white line "The End of Life." The whole package is a wonderful reminder of the unique ways design and writing can fuse together in print.)

Health care is a topic I frequently come back to in this blog. I can't think of any financial decision more urgent -- what wouldn't you pay when you life is at stake? I also can't think of any financial system more utterly broken in this country. You think the housing market got irrational during the last decade years? It's nothing compared to health-care spending.

Amanda Bennett and her reporting colleague, Charles Babcock, do an astonishing job illustrating both the micro- and macro-economic issues of our current health system. The story's eye-grabbing headline number, $618,616, is what it cost for a seven-year fight against the kidney cancer that in 2007 killed Bennett's husband, Terence Bryan Foley -- "father of our two teenagers, a Chinese historian who earned his PhD in his sixties, a man who played more than 15 musical instruments and spoke six languages, a San Francisco cable car conductor and sports photographer, an expert on dairy cattle and swine nutrition, film noir, and Dixieland jazz."

It's a vast number -- not to corporations and Fortune 500 CEOs, but to those of us who budget carefully each month to pull together rent or mortgage checks. "I think had he known the costs, Terence would have objected to spending an amount equivalent to the cost of vaccine for nearly a quarter million children in developing countries," Bennett writes. "That's how he would have thought about it."

It's a number with almost no basis in tangible costs. The list price on one chest scan was $3,232. Medicare pays less than $300 for that scan. UnitedHealthcare pays almost $2,600. Empire BlueCross pays $775. What does it actually cost? "The documents revealed an economic system in which the sellers don't set the prices and the buyers don't know what they are," Bennett reports. "Prices bear little relation to demand or how well goods and services work."

Was one life worth this investment? Bennett does a deft job illustrating how fraught and unanswerable that question is. "Who did the paying? The health insurance system depends on healthy people bearing the cost for sick ones like Terence," she writes. "Should you have had a voice in Terence's final days? Would I make the same decision with my money for your loved ones? These are things I think about now but can't answer."

And yet. The intensive medical intervention -- at a six-figure expense -- bought Terence some statistically improbable extra time. I'll leave it to Bennett to describe what those extra months meant to her family -- stop reading this, go read her article.

I have my own version of the story, which almost certainly colors my health-care views. My mother was diagnosed with cancer when I was 14, and died of it when I was 16. I'm almost 32 now, which means I've lived nearly as many years without her as I had with her -- but there still isn't a day I don't feel how strongly how who she was affects who I am (hi, pitch-black sense of humor and perfectionistic streak! Also, the financial geekery. I like reading SEC filings. There's no way that's not genetically influenced by my bookkeeper mom -- it's downright unnatural.) And four years ago, I spent most of a week haunting the ER and waiting rooms at our local hospital. It was a medical problem with a lingering aftermath, and a fresh reminder -- not that I needed one -- of how essential good health is to having a life you enjoy living. And how financially fraught trying to safeguard it can be.

Fixing our health-care system is a bogglingly complex undertaking. There's a thousand ways changes can go wrong, and just as many ways for those with vested financial interests to hijack improvement efforts. But there's also a giant cost to leaving things as they are. And even for those like me, like Bennett -- with top-quality health insurance and the financial resources to navigate the labyrinth -- it's a badly broken system.

We can't afford to maintain the status quo.

Notes from the trenches

I'm now midstream on the buying-real-estate process. Almost every email I've sent in the past week begins with "EEK!"

The status: We made an offer. We haggled. The seller counter-offered not just a different dollar figure but an entirely different apartment. (It's a big building, about 250 units, of which a bit more than half are sold.) We liked the new (cheaper!) apartment much better and asked why we hadn't been shown it before. Answer: Because the asking price was vastly higher than the one on our original target. But since the square footage is a tad lower, the developer will take a lower price on it -- despite it having various other advantages that made it, to us at least, more attractive.

NYC real estate is insane.

Someday I will have a proper blow-by-blow, but here's what I've learned so far:

-NYC real estate is insane but the closing costs are off the planet. My whole real-estate quest started because I got envious of my friend's story of buying a Baltimore townhouse with an FHA loan and total cash costs of $4,500. My cash costs? We will be damn lucky to get out for $40,000. That includes 3.5% down and -- the really ouchie part -- NYC's smorgasboard of closing costs. Corcoran has a breakdown that seems accurate in my limited experience so far.

-If you're buying NYC real estate, do anything you can to get a CEMA (Consolidation, Extension and Modification) from the seller. I'm told they're more work for the banks and the lawyers, but they also save you vastly on the tax costs. Originating a new mortgage costs you almost 2% of the sale price in New York taxes. A CEMA transfers the seller's existing mortgage to you -- you only own taxes on the difference between their mortgage and your new one. We got a CEMA, and it's saving us a five-digit sum.

-On other hand, even with a CEMA you'll still get hit in New York with property transfer taxes. In our case, that also equals just under 2%, which has to be paid at close. Did I mention how much NYC real estate bites?

-If you're planning to tap investment or retirement accounts, start setting things up as early as you can. I'm pulling money from my IRA (Fidelity) and David's IRA (Vanguard).

When we went to transfer funds to cash in his IRA, we found that Vanguard didn't have proof of his taxpayer ID. That required sending in a W9. We're now waiting for it to process.

In my IRA, direct deposit of funds you're withdrawing requires activating a connection with your checking account. Fidelity claims that takes seven days, but I activated last Wednesday and my account says it won't be ready for transferring until this Friday. Then the actual transfer can take up to five days to process. I imagine I'll be paying the $15 fee to wire cash, which I could have saved if I'd set up the electronic account connection sooner.

Selling investments to move the money to cash also takes time. I did that too last Wednesday and am still waiting for my VWO trade to settle.

-If you can avoid an FHA loan, do it. It's pricey, costing 1.75% of the loan amount upfront (you can fold the cost into your loan, but you still have to pay it) and a monthly premium of up to 0.55% of the loan amount (calculated annually, paid monthly). It takes the place of PMI, which you don't pay on FHA loans. In our case, the premium adds $260 a month to our payments. If you have the money for a more substantial downpayment (we don't), you can avoid all this.

-EEK!

Hold breath, leap

Last time I posted, I was consumed with changing bank accounts. (I'm trying Schwab now, btw. Will report back soon on it.) Life is odd in how damn fast it changes.

We're trying to buy an apartment.

I kind of don't want to say much in case I jinx it, but if this works -- or if it irrevocably doesn't -- I'll post all the gritty details. The short version: The annual lease on our apartment runs out Feb. 28, and we'd planned to move. I **loathe** moving, but after five years here, I can't pretend any longer that two people, two cats and 2,000 books fit into a glorified studio with one (ONE!) closet.

I grumpily started scoping out rentals. I pretty much assumed that these days, if you can't put up 20% for a downpayment (and in NYC, that means six figures), you're toast. But one of my friends recently bought a house (in Baltimore) with an FHA loan. And I'd been hearing about various Brooklyn condos getting FHA approval. So I did a bit of poking around -- and found, much to my shock, that it has suddenly become a somewhat viable option.

You lock yourself out of most listings if you need to go the FHA route. I'm told getting approval for single family houses is very hard (many still exceed the loan-size caps, even though they've been raised), and you flat out can't do a co-op, which is what vast swathes of the NYC apartment market are.

But there's a half-dozen high profile Brooklyn condo projects that now have the fast-track FHA approval. And there's one I'm really drawn to. And we found a unit in it that is really, really intriguing for us. And I spoke with the building's preferred lender, and he gave us the green light for a loan with his bank. (5.5% interest! at worst! he thinks maybe less!)

So after two days of incessantly banging on my HP 12-C to work out all possible fees, contingencies, etc ... we're about to ready to put in a bid.

EEK. This feels like jumping off the high diving board.

Chase's incredibly sleazy WaMu bait-and-switch

Well, I need a new bank. Again.

As mentioned before, I have one hard-and-fast, possibly irrational demand for my bank accounts: No fee for using outside ATMs. I'll pay a fee to the ATM operator. I think the fees are obnoxiously high ($2 to spit out some cash? Really?), but I can at least recognize that the ATM owner is providing me with a service. For my own bank to charge me a fee for daring to venture outside its ATM network is punitive and controlling and it makes me wildly angry.

I realise that getting as wound up as I do about something that, at the outside, would cost me maybe $100 a year is unreasonable. I'll drop $100 for a dinner out without wincing. But. For whatever reason, this is my flash point. I do not want to do business with a bank that charges me for outside ATM withdrawls.

The last time I went bank shopping, WaMu won in large part because it didn't have outside ATM fees. That turned out to be not wholly true -- WaMu sneakily snuck in fees for checking your account balance at an outside ATM, even though withdrawing cash was free -- but I grouchily decided to let that stand.

When WaMu went down, this was my biggest and most immediate concern about getting rolled to Chase: ATM FEES, DO NOT WANT.

It took Chase nearly a year to actually force migrate me from the WaMu platform to their own, which finally happened in full in July. Chase sent out a giant, thick packet of diclosures about my new bank account. I, of course, skipped right to the ATM fees section, and found what seemed to be good news. For ex-WaMu customers, Chase was creating a new account, "Chase Free Extra Checking." Key difference between that and Chase's usual checking: No outside ATM fees.

I was pleasantly impressed. Chase seemed to be doing the right thing by its WamMu crowd. I carried on, relatively happy with my new bank.

Until this morning, when I went to balance my checkbook. And found, littered through my November transaction register, two $2 fees labeled "NON-CHASE ATM FEE-WITH"

What. the. hell!?

So, spitting bullets, I called Chase customer service. The rep explained that my account terms called for no fee for the first two non-Chase ATM withdrawls each month, and a $2 fee thereafter.

NO, I fired back. NOT TRUE. I have here this giant thick account disclosure paperwork stack which explicitly says no fees ever ...

While she put me on hold to go find an account specialist, I went Googling.

And found this blog post, with a warning in the comments about "IMPORTANT CHANGE TO NON-CHASE ATM FEES
FOR CHASE FREE EXTRA CHECKING"

Oh bugger.

Seems Chase snuck a pretty significant change in the account terms into the fine print of September statements. Here's the thing: Like almost everyone else on Earth these days, I have paperless statements. I don't read them. I scan my account register to reconcile things, but don't go reading fine print each month. And Chase never sent any kind of alert or special disclosure about "hey, we're changing the terms of your account, here's the explainer to read."

I pulled up the electronic version of my September statement, and sure enough, there's the ATM fee change notice. A whole TWO MONTHS after Chase helpfully assured me it wouldn't change fees. And the "two a month" bit is temporary -- starting 2/2/2010, all non-Chase ATM withdrawls are slapped with fees.

I'm pissed off and bank shopping.

It's not just the fee. It's the slimy way it was snuck through, and the lack of transparency, and the general sense I've always had from Chase that customer service is way, way down on their priority list, significantly below "pry every dollar we can from the marks we do business with." I always hated the way they treat credit-card customers. I shouldn't have expected them to treat banking customers any better.

So. Anyone have a bank they actually like? With no ATM fees. Because I am getting the hell out of Dodge, before Jamie Dimon's hordes figure out a way to slap a surcharge on customers for consuming oxygen or whatnot.

Must be love

The spouse and I just had an epic, high-volume heated debate about federal financial regulation. Now that we've made up, I'm utterly amused by this. Perhaps this is a topic they should add to premarital counseling -- "What's your theory on housekeeping? Do you want kids? And how do you feel about the last five Treasury secretary appointments?"

Silicon bonanza

Twenty years ago right about this month, my dad went out and bought our family's first personal computer. It was an Apple IIGS, and ours was the first family I knew of with our own computer. I recall it costing around $2,000.

My sister and I loved the new computer. It arrived just in time for me to hit middle school and start having papers to write, and I still can't fathom how anyone did that before electronic word processing. My family also had an electric typewriter, which I think I might have used to write precisely one school paper, but even then I had the sense that typewriter was more of an archaic novelty item than an actual functional tool.

The IIGS was eventually joined by a Mac (nominally bought for my Mom to use for her business, but Lisa and I mooched it frequently), and when I went off to college, I spent all my savings buying a Mac laptop. It had a 500MB hard drive and cost me about $1,000.

Not long after that, my sister got a first-generation iMac, and thus began our era of everyone in the family having their own PCs.

Since that first college Mac laptop, I've run through more computers than I can count. (In several cases, the line between what was 'mine' and what was my job's computer has been fuzzy -- starting my sophomore year of college, I had a school-issued laptop for my Residential Computer Assistant gig, which I basically used as my own personal machine as well as for work stuff.) But for the past decade, one split has been clear: I have my computers and David has his, and the two sets stay very separate.

Some of this comes down to preference. I like desktops, and by the end of college I'd made the switch from being an Apple fan to preferring Windows. (Yes yes, I know, this makes me an inferior human being. Trust me, there's nothing you can say on this that David hasn't already.) David strongly prefers Macs and laptops. So as soon as we had the spare cash, he went out and got his own MacBook.

This popped to the front of my mind right now because my current desktop has been showing signs of impending death for months. It's only the second desktop I've had since 2002, and I got about four years out of it, so I can't complain too much about having to upgrade. I took the early Windows 7 reviews (the general tenor seems to be "well ... it's waaay better than Vista ... and seems to be actually ok ...") as a sign that I should finally let go of Windows XP. So, sitting on my living room floor and waiting to be installed, is a new HP Pavilion desktop with Windows 7. Total cost: $544. Can't complain about how computer costs have fallen over the years.

But I'm curious: Are David & I now the aberration or the norm? Do most families share one computer, or does everyone (adults, at least, and probably older teens) have their own?

Also, I remain slightly boggled by just how damn much computing power we get to take advantage of these days. David's standard computing lineup consists of: MacBook, iPhone, iPod 60GB classic, BlackBerry, fancy Canon camerathingie I forget the details of.

My computing setup: Windows desktop at home, HP Mini netbook for travel, BlackBerry, cell phone (very primitive Samsung, but it does have a browser), Palm (Tungsten E2, and I remain in deep denial about Palms basically being discontinued), iPod nano and Bluetooth-equipped Canon PowerShot. And all of that together costs less than my family's first IIGS. Wow.

Paychecks -- YAY!

One of my goals for 2010 is going to be "regain this mythic Work-Life Balance I hear talk of." But for the moment, I remain buried in gianter stacks of Things to Be Edited than I'd ever imagined existed. Possibly deciding "sure, I can manage 50 pieces for this upcoming big package!" was not one of my cleverest moments. (Caveat: I like my job better than any I've ever had, which is nifty. However, I wish I had 40-hour days in which to do said job.)

But while I've been toiling in the edit mines and not blogging, David returned to the working world. Six months after he quit his job, he's landed a new one.

Which changes our economic picture quite a lot.

We managed the one-job period better than I expected. Dropping to one income was always one of my personal nightmares, and it's been a happy surprise to find that we managed to pay our rent on time every month, cover the bills, and not slip into more credit-card debt than we can clear up in a month or two. This remotivates me to actually attempt some frugality and savings when we return to our usual two-paycheck state.

David's new job has two key features that make it very of-the-zeitgeist. First: It's a contract job. The general idea is that if both sides are still happy in a few months, it will convert into a standard salary-and-staff position. But he came in the door as a freelancer, and for the moment, the company prefers to keep it that way.

Which is fine by us, since we're covered on the only area of staff-vs-freelance job I don't want to live without: health insurance. My company has an absurdly good plan, and David switched onto mine as soon as I took this job. Paid time off, a 401(k), job security and other such luxuries would be nice, but as long as he's got health coverage and is getting steady paychecks, I can't get too fussed about 'em.

Second: David landed this job through personal networking, not a recruiter or job board. Personal networking of an especially oddball sort. He and a friend of his volunteer as Stats Dudes for the local roller-derby league. One of the skaters is a statistician. She and David got to chattering, and when an opening for a statistician came up at her company, he used the ref to get in the door. Ask me which of his many interests and hobbies would lead to a job, and I would never have guessed roller derby ...

We're still a few weeks away from actually getting that first check, and having to sort out freelancer taxes is going to be lots of fun. (I am suddenly very grateful for an excellent article a freelancer pitched me a few months back: "Freelancers: How to not screw up your taxes.") But we're at least tentatively back to full-operating-budget status.

And as the cliche goes -- David losing his job (in a roundabout way, since he quit) may have been, unexpectedly, the best thing to happen to us all year. He spent almost 10 years there, and many were good years, but things had gotten pretty rough. He needed new projects and challenges. Having a few months' break cheered him up astonishingly much, and he's really enjoying the new gig and the people he's meeting there. I thought quitting a job in the middle of a recession would be a horrendous mistake, but it seems to have led to much better things.

I like when life works out like that.

(Edited to add -- I've had this blog almost four years and never before made a "jobs" tag? How odd.)