Happy Mother’s Day! If you are looking for an exemplary mother, besides your own of course, then the book and movie, The Prize Winner of Defiance, Ohio is a great place to start. We just watched the film on Netflix and it was truly remarkable the amount of love, perseverance, and frugality that the mother possessed.
Chili, pumpkins, beautiful Autumn foliage and of course influenza, yep it’s that time of year again. The flu shot (vaccine) can be found almost everywhere nowadays. Our local pharmacies have more signage out advertising the flu shot than an election campaign on November 1st. Some employers, like Shae’s, even have flu shot drives on site.
Last flu season (Oct 2013 to May 2014) only about 34% of 18-64 year olds were vaccinated but the same age group made up 61% of hospital cases. So the myth that flu only affects children and the elderly is totally bunk.
This year, in order to help protect Frugal Boy and our sanity, we each received a flu shot.
So what exactly is the flu shot and how does it protect you from getting sick? Each year, researchers try to predict what strains of virus will be prevalent in the upcoming flu season. They then grow those viruses in chicken eggs, deactivate the grown viruses, and combine them into one big slurry that is your vaccine. The inactivated viruses in the vaccine cannot make you sick, they are for lack of a better word, dead. Your body however doesn’t know the difference, so it produces antibodies to fight off the ‘dead’ invader. Once your body has created antibodies to counter the viruses, you have an immunity to that particular strain of influenza. This immunity takes about 2 weeks to develop from when you receive the vaccine so if somebody in your house already has the flu, you’re probably too late to get protected.
It is difficult to say how effective the flu shot is because there are many variables for each year and individual. If you’d like to read more, the CDC has a webpage dedicated to the topic.
Finally, the conversation of the flu shot wouldn’t be complete without talking a bit about side affects real and mythical. Unless you have an allergy to eggs or latex, the basic needle stick in your arm flu shot will only give you a sore arm for a couple of days. There are a few nutters out there that claim that mercury in a flu shot causes autism. They are full of crap, and here is what the vaccine information sheet has to say about that,
Some inactivated flu vaccine contains a very small amount of a mercury-based preservative called thimerosal. Studies have shown that thimerosal in vaccines is not harmful, but flu vaccines that do not contain a preservative are available.
So take off your tinfoil hat, and if that is too much to ask for, just get a darn flu shot that doesn’t have preservatives.
Shae’s shot took 5 minutes out of her day (employee clinic), mine took 25 minutes (doctor’s office). Walgreen’s and CVS are probably somewhere in-between. The cost is a whopping $30 without insurance. If you’re reading this blog, chances are good that you have health insurance. So go get vaccinated and save yourself from several days of misery!
Today is the Illinois Primary election and as primaries go, it is predicted to have a low voter turnout (25-30%). Many voters are either apathetic or simply don’t know about primary elections. Unlike general elections where a candidate from each party squares off against the other (Obama vs Romney), the primary election decides the party’s candidate for the general election. So if you complain that there are never any good candidates in a general election, it’s because you didn’t vote for them in the Primary!
Also, primary elections include many local positions and questions. For instance, our county sheriff is being elected today because there is no democrat challenger, so whomever wins the primary vote for sheriff gets the job. We have a semi-closed election in Illinois, meaning that in the Primary you can pick what ballot you want (Republican, Democrat, Green, NonPartisan, etc.). The next primary you can choose a different one! Choose the ballot that gives you a greater voice in the outcome of the elections.
A big local impact that will affect citizens directly is a proposed increase in sales tax from 7.25% to 8.25%. If you only ever vote in general elections, you may be missing out on the chance to voice your opinion on matters that affect you.
We took a family walk to our nearby polling place this morning.
Frugal Boy wasn’t impressed with the democratic process. We’ll have to work on that attitude.
We just finished our Federal and State 2013 tax returns. We had overpaid on both, so it was imperative to get the returns filed as soon as possible so we could get our refunds. Every year, our goal is to be as close to 0 as possible for refund or amount due. The reasoning is simple, if you owe too much then you could end up with a penalty. If you pay too much and are owed a refund, then you gave the government an interest free loan. That money could have been working for you instead of Uncle Sam.
Over the past three years we have been getting better at estimating our final tax bill.
In 2011, we had an underpayment of almost $9000 (OUCH).
In 2012, we had an underpayment of about $4500.
In 2013, we had an overpayment of $1000.
There is obviously still room for improvement, but it is encouraging to see the numbers moving in the right direction (closer to 0).
One of the benefits of doing your own taxes is that it helps you learn the system. After a few years of filling out your own taxes you can see where you are getting punished and where you can get rewarded. Using this information, you can make informed decisions for the next tax year so you can reduce your effective tax rate. A good CPA should also be able to make recommendations for your specific circumstances, but I doubt your average national tax chain shop like H&R Block or tax software such as TurboTax will give much insight into the process. Those types of places want you to be confused and scared so you keep on coming back to them each year.
Anyway, getting back to the point. I like to use the effective tax rate to see how well we are managing our tax burdens. You can figure your own effective tax rate by taking the number on form 1040 line 61 (or whatever is marked total tax) and dividing it by line 22 (or whatever is marked total income). You can see how our effective tax rate has gone down over the past three years as we have learned to take advantage of tax protected retirement accounts like a 401k.
You can even compare your tax rate to the 2012 presidential candidates courtesy of the Wall Street Journal. Mitt Romney was at 14% and Barack Obama was at 19%. MSN also has some additional reading and statistics on effective tax rates.
I suspect that we will be able to reduce our effective tax rate even further as we add a dependent child to our household and take advantage of tax protected accounts even more (Health Savings, 401k, 529, etc. etc.).
Do you know what your effective tax rate is/was?
April, the dreaded tax month, is on the horizon and it isn’t too early to start thinking about what you may owe to Uncle Sam.
The nice thing about crunching some numbers now is that there is still time to play the numbers in your favor. For instance, if you make estimated quarterly payments (like I do for my home business) then you can still adjust your Q4 payment, due 1/15/2014. This might help you avoid a penalty for paying too little. It might also save you from getting a refund (aka a 0% loan to Uncle Sammie). Also, you can still contribute to your tax protected retirement plan until April. If you are toeing the line between tax brackets a large contribution to your retirement account may put you into a lower bracket. Below are the tax brackets for 2013.