How Should You Prepare For the End of the CARES Act?

What’s inside? Here are the questions answered in today’s reader mailbag, boiled down to summaries of five or fewer words. Click on the number to jump straight down to the question.
1. CARES and relocation money
2. Car financing question
3. Hello Fresh or Blue Apron?
4. Letting term life insurance expire
5. Low-cost backpacking
6. Paid off all debt
7. Thoughts on Wirecutter
8. Cashiers check scam?
9. Saving for more remote lifestyle
10. How to brain dump?
11. Saving for expensive 2021 vacation
12. Tablet as desktop replacement?

A few readers have asked about how we’ve been doing remote camping this summer. We’ve been using Hip Camp to find interesting remote campsites with very small numbers of spots (one or two spots). This basically leaves us completely isolated with no one nearby and usually with a lot of trails and other things nearby to explore.

Our favorite site was one that was on the same ground as a family farm. We camped well away from the actual farmstead at the foot of a hill that had a pump and electricity nearby, which was enough for us. There was also a building nearby of which part had been converted into a large bathroom. There was a small, stocked lake with a dock there and a small boat we could use, along with trails on the hill and some nice scenery. There was a nice state park several miles away that was basically empty during the week.

It turned out that this area was something the family had developed over time for family reunions. Several family members would camp in the area where we camped, the whole family would use the pond and the hill area for trail walking and other activities, and they’d also spend a lot of time over at the farmhouse as well.

If you’re looking for very isolated camping opportunities this summer, I recommend it!

On with the questions.

Q1: CARES and relocation money

My job laid me off in March and then in May they decided to stay closed for good. I don’t have a lot of other employment opportunities in this area so I have been job searching in a city about two hours away. I have been getting unemployment but things are going to get very tight when the extra CARES money ends in a month. I’m spending as little as possible already and trying to have an emergency fund. The problem will be if I get a job and have to move.
– Bradley

You’re absolutely doing the right thing by trying to live lean now and putting money aside so that you can live with smaller unemployment checks after the CARES Act runs out. (For those unfamiliar, people on unemployment are receiving larger unemployment checks through July 31 thanks to the CARES Act.)

If I were you, I’d designate some portion of that as a “moving fund” and then do everything possible to avoid tapping that moving fund in August and beyond until you’re actually moving for a job. I would start getting rid of possessions so that you can move with as few trips as possible, ideally with all of your belongings that you need to take with you fitting in one vehicle load.

I would also talk to people in your social network that might be able to help with this move, perhaps going with you to help transport some items and move things in and out. The more friends and family that can help you move, the less the cost will be.

I don’t know what kind of job you’re trying to get, but some jobs do offer some money for relocation for their desired candidate. It can’t hurt to ask. It sounds like you’re in a specific field where there are specific technical skills required, such that there’s both a small pool of jobs and a small pool of skilled candidates. Those types of jobs often offer some perks like relocation money. This can help greatly with the expense of moving.

Q2: Car financing question

I graduated in May 2019 and have been living with my parents ever since. I have spent most of that time trying to seek work. I did not own a car during college and have been using their car to drive to interviews. I got a job offer in February that was rescinded in March due to COVID-19. That job was in the area so I had intended to use the train to get to work. I recently got another job offer that starts on August 1. It is in another city so I have to move. I have little savings and need a reliable car to move. I have an apartment lined up that’s available starting July 22. I am looking at buying a car but have no savings. All of the loans are really low interest right now and a new car has 0% financing for 60 months. What is the best option? Older used car for cheap? Late-model used? New entry-level car? I don’t have any interest in a luxury car.
– Damon

Is it an absolute requirement that you have a car to be able to commute back and forth to work? If you went out to your car one morning and it didn’t start, could you take a bus or a train or a subway to work without much difficulty?

If that’s the case, then you’re mostly buying the car to make moving easier and to visit remote friends and family, not so much for commuting. In that case, I’d get an older car that’s still reasonably reliable, something 5–10 years old with 100K to 150K miles on it. I’d make sure a mechanic looks it over before buying it and, once you have it, I’d stick to the maintenance schedule like glue.

If your job absolutely requires you to be able to commute via car every day, I would get a very reliable late-model used car or a new car (I prefer Toyota or Honda for reliability). In an era where interest rates are so low and new cars are being sold with 0% financing at the drop of a hat, the case against a new car isn’t as strong as it is in an era where financing is a lot more expensive. Yes, you’ll get a better overall value buying a late-model used car, but the first 50K miles on a new car are the most reliable ones — you just pay a premium for them, but in an era with such low interest rates, the premium is about as small as it gets. If you’re buying an entry-level but reliable new car, that’s not a terrible option.

However, if you don’t absolutely need a car to commute every day and will have access to mass transit, I wouldn’t buy anything more than a fairly reliable older car. A 2013 Camry with 100K miles on it would be about perfect if you can find that at a good price.

Q3: Hello Fresh or Blue Apron?

During the lockdown, I just lived on mac and cheese, ramen and microwave foods. I’m trying to start actually making real food for myself but even simple recipes seem overwhelming. Have to make a long grocery list, go to the store, come home, figure out how to use six pots and pans, end up with a sink full of dishes and all to make a mediocre meal where I saved $5. I know it’s not that way when you get used to it but I am just not there. I am thinking about using “meal kit” services like Hello Fresh or Blue Apron to get used to cooking like training wheels on a bike. What do you think?
– Dana

I tried both services just to see what they were like and my experience is that they were pretty expensive for what they were. They do a good job of walking you through making a specific recipe, but if you go online and find a recipe for that dish and just buy the handful of ingredients for that dish, you’ll basically do the same thing at a fraction of the price. I don’t find those kits to be a good value.

If you really want to get more experienced in the kitchen, I would suggest starting by making your own versions of what you already like. For example, I’m assuming you make mac and cheese from boxed kits. I suggest trying this three-ingredient stovetop mac and cheese from Serious Eats. It’s not too complicated, but a step up from a kit. Then, start experimenting with different cheeses to see which ones really click with you.

What other freezer meals do you like? See if you can find a very simple recipe for that, from scratch, but don’t hesitate to use some shortcuts, especially when you’re first learning. For example, you can make a “hot pocket” using pre-made dough and some other ingredients. Then, try making your own dough once this seems simple. Do you like pasta? Try making your own pasta with sauce — just a jar of pasta sauce and a box of dried pasta. Then, maybe try making your own sauce a time or two.

Nothing here is going to result in a kitchen full of dirty dishes – at most, you’ll wind up with a dirty pan and a dirty bowl and maybe a baking sheet.

For me, I found that gradually stepping back and making each element of a dish from scratch was a learning experience, but it made the resultant dish better and I built some skills, too, without being overwhelmed.

[Read: Best Cheap and Easy Dinner Recipes]

Q4: Letting term life insurance expire

I am 34 and single. A few years ago I bought a term life insurance policy for 30 years as I wanted to lock it in during years when I thought I would be married and having kids, but we ended up getting a divorce and I have no desire to ever remarry. The policy seems rather pointless now as I do not intend to ever have dependents. Are there any penalties for just letting a policy expire?
– David

You’ll want to review the actual terms of your policy, but for most standard life insurance policies, you merely need to contact them in writing informing them that you wish to cancel your policy on the date that the next premium payment is due. So, for example, if you’re paid up through August 31, you’d send a letter informing them that you wish to cancel the policy on August 31.

This action should not have any consequences for your credit. However, if you choose to simply stop paying your premiums, there may be a report to the credit bureaus. Simply not paying will void your insurance contract, but it may also result in some negative credit impact on you.

If I were you, I’d send them a letter informing them that you wish to cancel your term policy on the date that your next premium is due, then contact them by phone a week later to ensure that they received the letter. That should be all you need to do!

Q5: Low-cost backpacking

My husband and I have talked for a few years about taking up backpacking as a hobby because we love going on day hikes. We decided a few weeks ago to try our first overnight hike in August or September, but as we looked into what we need to do to prepare for it, the startup costs are enormous. This feels like a rich person’s hobby. You have mentioned your family hikes a lot. Have you tried backpacking and if so how have you kept it cheap?
– Erin

Sarah and I are in the same boat you are. We have been talking about getting into backpacking, but have resisted it thus far because of the expense. Instead, we do a lot of day hikes — basically, the longest hikes that our children will tolerate — with a normal backpack that includes some food, a first aid kit, sunscreen and water.

Having said that, we have done a ton of homework about how we would go about this on a budget, both for our own interest and for a potential article down the road after we actually do it a few times. The big expense, from what we can tell, is the tent and sleeping bags. You need them to be lightweight, as you’re carrying them on your back for hours, and lightweight tents and sleeping bags are expensive.

Your best bet for your first hike is to borrow that equipment. I would suggest buying used, but lots of people are trying hiking and backpacking in this moment in time and there isn’t a whole lot of used backpacking equipment out there. Just ask around your social network as to whether any of your friends happen to have any backpacking equipment, particularly tents and packs and sleeping bags, and borrow them for your first attempt or two.

Sarah and I, unfortunately, do not have any local friends that we can borrow equipment from. I have a cousin in Colorado who is an avid hiker who has offered to loan us any and all equipment that they have if we visit them at the start of our hike (thanks, L.), which we may eventually take them up on.

Thus, our strategy has been to identify a bunch of tents and other gear that would work well and watch carefully for when those models are replaced and the outdated models go on sale. We’re willing to invest some money in this and we’re patient. One guide I have found useful in this search is this budget backpacking gear guide, which is a really good list of inexpensive starting gear that’s reasonably good quality, more than suitable for the first few hikes. It was recommended to me by my above-mentioned cousin, who also strongly suggested looking at Army surplus gear.

Q6: Paid off all debt!

I started reading your site in 2011 when we were first dealing with mortgage payments. We had student loans and two car payments and it just felt impossible to even keep the bills paid let alone get ahead on things. I found your site from Google searches and read a bunch of your articles and then read your book and Your Money or Your Life. My wife and I decided right then to cut back significantly on our lifestyle and focus on getting rid of all of our debt and then eventually reaching a crossover point. We had a child in 2016 and another in 2018 but we still kept plugging away and in May we sent in our last payment on our mortgage. We have zero debt and it feels great! Now we’re putting 20% of our paychecks into 401(k) and TSP and both maxing out a Roth IRA. We want to be able to retire when our youngest graduates from high school. Your advice and Your Money or Your Life changed our lives completely. There is no money stress anymore and I wake up feeling happy and like life is so full of possibility.
– Jon

Congratulations!

That moment when you send in that last mortgage payment and realize that you owe nothing to anyone anymore is a transcendent moment, isn’t it? At that moment, you have this feeling of control over your life that had been gone for so long. Having no mortgage payment, student loan payments or car payments just makes everything feel possible again, and that feeling for me at least is one that I would live on rice and beans for years to have in my life. It’s a feeling I want everyone to have.

It’s not easy to get there. It requires a lot of saying “no” to temptations, really learning what the difference is between momentary pleasure and a lasting positive in your life and a lot of planning ahead. That’s hard to do.

However, life is full of hard things that are worth doing. So often, when we do the hard thing today, it makes a far better life tomorrow.

Q7: Thoughts on Wirecutter

What are your thoughts on Wirecutter? Better than or comparable to Consumer Reports?
– Andrew

Those are my two go-to places for comparative reviews of products when I’m trying to make a buying decision.

Consumer Reports is my preferred source. It has led me to the right choice on so many different products over the years in terms of finding a really good item for a good price for whatever specific type of item I’m looking for. The problem is that the breadth of Consumer Reports is sometimes lacking. It doesn’t have comparative reviews for everything I’m looking for. Sure, for larger things, it’s usually got a recent comparative review — things like major appliances and cars. However, for smaller things — like household tools and blankets — it’s very spotty. I tend to still trust it for those things, as long as the comparative review is less than a year old.

If Consumer Reports doesn’t have a recent comparative review, then Wirecutter is usually where I go next. It will usually have a comparative review of the exact thing I’m looking for.

I should note that for many items I’ll buy a used item or an entry-level item first. If I find I’m not using it much, then I’m glad I didn’t invest a lot in the item. If I am using it a lot, I’ll keep using that cheap model until it either breaks or some design flaw drives me crazy, and that’s the point when I start looking at Consumer Reports or Wirecutter. I don’t always follow their recommendations, but I often do. I tend to go for the one that’s lowest in price unless it’s lacking a feature I’m specifically looking for.

Q8: Cashiers check scam?

I was trying to sell our old Toyota Corolla on Facebook Marketplace. Now that we’re both retired we just never drive it and it only has 80K miles on it. Figured someone could use a good commuting car and I hoped to sell it local for a good price. Someone contacted me and asked if they could pay by cashiers check. I agreed but then my wife said that it didn’t feel right. Is this a scam?
– Bill

It’s hard to tell from this story whether it’s a scam or not, but I would avoid accepting a cashier’s check from a stranger. I think your wife made the right call.

As a general rule, I would only accept cash for a sale like this. I would not accept a check or wire transfer of any kind. The only other option I would consider is an escrow service operated by your bank, where they hold the car in escrow until the check clears. If the person buying the car refuses to pay in cash and refuses to use an escrow service, then I wouldn’t sell the car.

This doesn’t mean that all cashier’s checks are fraudulent. I would accept one from a trusted friend or relative, as there are situations where they are useful. However, selling a car to a stranger doesn’t fall into that category.

Q9: Saving for more remote lifestyle

I am a software developer that works almost entirely remotely. I enjoy time to myself and spending my free time doing hands-on tasks and reading. During the shutdown, I came to realize that I really enjoy a more isolated lifestyle. I loved not having a calendar full of events that I didn’t really enjoy and I dread my calendar filling up again. My work should be 95% to 100% remote going forward, so I have the professional capacity to move into a rural area and establish a homestead. I currently live in a one-bedroom apartment and I have no debts. Do you have any suggestions as to the next steps regarding saving for this kind of life change?
– Marcus

The question I’d ask myself is whether you’re willing to go into debt for some of the initial expenses of this project. Are you willing to take out a mortgage to buy a piece of rural land? Are you going to build your dwelling there yourself, have someone build for you or buy a home that’s already built? What will those options cost, and are you willing to go into debt for them?

In other words, I’d start this thought process with a plan for what you want to do, then follow that overall plan with how you want to finance it. It sounds to me like you want to make this transition sooner rather than later. I’m guessing that you don’t have enough savings to buy a piece of land in a rural area and get it up to speed with your needs (meaning having power, sewage, water, internet and other services set up). That means you’ll likely be taking on debt to do this, so you’ll probably want to start looking at small parcels of land in areas that you’d consider moving to and getting pre-approved for a loan to buy that land and get it configured for your needs.

I’d probably start by putting a very small temporary dwelling on that land, like a trailer or a small prefab home, then do as much of the construction of your more permanent home and set up by hand as you can. As you noted, you’re wanting to do this in a hands-on way, so building as much of your home yourself and putting sweat equity into it will both scratch that itch and save you a lot of money.

If you want to save for it and do this without debt, aim for the cost of the kind of land you want plus a simple dwelling and the cost of getting basic services established. You can build exactly what you want from that foundation. Without knowing the area you’re buying in, how much land you want to buy and other factors, I can’t really give you any sort of a timeline for saving for this. I will say that if this is what you want to do, I would aim to live as absolutely minimally as possible in the meantime, save every dime you can, and spend your free time learning and making lots of specific plans. If your estimated timeframe for saving enough money is less than five years, I’d use a savings account for it. If it’s longer than five years, I would open an account with an investment firm and put at least some of the money into broad-based bond and stock index funds (bond funds if you’re closer to five years, stocks if you’re looking at 10 years or more). If your timeframe is that far out, though, I’d spend some time studying investment options; start with The Bogleheads’ Guide to Investing.

Q10: How to brain dump?

Reading your guide to organizing your time and tasks, I had some questions about the “brain dump.” I tried doing this and I ended up listing hundreds and hundreds of things and I just feel overwhelmed even trying to process them. How do you do this without being overwhelmed?
– David

So, a quick refresher for those who haven’t read the original article, a “brain dump” simply means that over the course of several days, you write down literally everything that’s in your head that is something you need to or intend to do in the future. You get all of it out of your head and down on paper so that you can organize it meaningfully and, even more important, don’t have to waste even a fraction of your focus thinking about those things because they are in a trusted system that’s not in your head.

For me, whenever I do a brain dump, I go back through the list and make a few changes. For anything that isn’t something I’m going to obviously do very soon, I ask myself if I’m ever going to realistically do this. Is this just a complete pipe dream? If I know deep down I’m never going to do it, I just cross it off. If it’s something I truly intend to do but it’s still down the road a bit, I mark it as “someday.” This tends to take care of a lot of things on that list.

Now that I have all of those tasks in a task manager, I have all of the “someday” tasks tagged and separated from everything else. I regularly look through them, particularly when I feel like I have some downtime, and I move a couple up into the regular tasks (ones I’m going to do soon) and delete a few more. If I have other “someday” ideas, I just add them in and tag them as “someday.”

To be honest, if I look at all of the tasks in my task manager, even just the ones that aren’t “someday” tasks, it is overwhelming. The thing that I keep in mind is that most of those things are important but not necessarily urgent, and by just taking care of a few each day, I will get through a lot of them.

Q11: Saving for expensive 2021 vacation

We typically go on a fice- to seven-day family vacation each summer. This summer we were planning on going on a “road trip” vacation with a couple of days in a cabin in New York and also a day spent at Cedar Point. Each year we save for our vacation in a savings account putting aside $250 a month so that we have $3,000 to spend on a nice trip. Without a vacation this year though we have decided to do something extra cool next year (undecided as to what). This means we will keep the $3,000 and keep adding to it giving us a $6,000 budget next year. Maybe a resort or Disney World or something. We are wondering if there is a better thing to do with that money than just letting it sit in savings.
– Brenda

Given that you know you will be using that money in a year, that you don’t really want to risk the balance, and that you probably won’t touch it until next June at the earliest, I would consider a nine- or 12-month CD at a local bank or credit union. A CD will keep your money secure without risking any balance loss and offer a better return than a savings account, though with interest rates so low the return isn’t that great.

Right now, you’re probably looking at a 1% return on a nine- or 12-month CD, compared to something like 0.1% or 0.25% in a savings account. That 1% does come with FDIC insurance — you won’t be losing any of your balance. However, the drawback is that you lose all of the gains if you take out the money before the CD matures — you basically won’t be able to touch the money for 9 or 12 months.

If you put in $3,000 in a 12-month CD at 1%, it will return $30. Comparatively, if you leave it in a savings account at 0.1%, you’ll earn $3; a 0.25% savings account will earn $7.50. Those aren’t big returns, but you’re looking at a pretty short timeframe without wanting to put any of the balance at risk and returns on those types of investments aren’t very good right now.

If I were in your shoes, I’d probably put it in a nine-month CD at the best rate you can find locally. Since you’re not going to touch it anyway, the $20–$25 you’ll probably make is better than earning $2 to $5.

Q12: Tablet as desktop replacement?

Our desktop computer is starting to have serious problems. It makes a loud whine if it runs for very long and shuts down on its own a lot. We are thinking about replacing it. We mostly use it for email, Facebook and for looking things up. No games or anything. Grandkids used to use it but just use their phones when they visit now.

We have been thinking about getting an iPad tablet computer to replace it and are wondering what you think of them. We paid about $600 for this computer and it lasted about nine years. Hope to get the same kind of value from our next one.
– Darla

There are a few things to consider here.

First of all, how much do you type on your computer? Are you often typing lengthy emails, or is it mostly just short ones? Are your Facebook comments or postings lengthy or short? The more text you type in, the harder a tablet becomes to use because you’re using an on-screen keyboard. In my experience, it works great for a small amount of text, but if you’re typing longer multi-paragraph things, it can become a little cumbersome. You can get an external keyboard, but at that point, you may want to just consider a simple laptop, like a Chromebook.

Second, how long do you use the computer in a given session? Is it a number of short sessions — 10 or 15 minutes, but more frequent — or is it longer ones like an hour or two, but less frequent? Tablets are wonderful for short sessions, but longer ones can be a bit tiring as you’re holding onto the tablet. Tablets are light, but you’re still holding it for a while.

It sounds like I’m nudging you away from a tablet, but I’m really not. I would vastly prefer to have a tablet if I’m mostly using it to read things or watch videos or occasionally type in search terms or short sentences. It does those things so well. I don’t do my writing for The Simple Dollar on a tablet, but I’m often using an iPad in the evenings when I’m reading stuff or watching a video or something like that — it just works so well for those things. For work, I use a full computer, but I do a lot of typing each day and I need a lot of screen space to position windows, and a tablet doesn’t really measure up for those things.

I think you’re in the “read things, watch videos, type in a few search terms, post a sentence or two on social media once in a while, maybe write a few sentences in an email once in a while” category, and if that’s true, then a tablet is a good idea.

My default recommendation for most home users is the entry-level iPad from Apple — in fact, this is literally the device I just recommended to my own parents to replace their old laptop. There are definitely cheaper tablets out there, but the build quality and lifespan of the entry-level iPad is quite long. I used one for several years, whereas my son’s Android tablet (which was cheaper) was borderline unusable after about three years of use. I think there are specific situations where other tablets are a good choice, but without a long Q&A, I’ll generally just point people toward the entry-level iPad of the moment.

You should definitely shop around if you’re going to get one. I’d check the various department stores (Target, Wal-Mart) in your area, electronics stores, and online retailers like Amazon at the very least. You can easily save 20% by looking around, and probably more.

Got any questions? The best way to ask is to follow me on Facebook and ask questions directly there. I’ll attempt to answer them in a future mailbag (which, by way of full disclosure, may also get re-posted on other websites that pick up my blog). However, I do receive many, many questions per week, so I may not necessarily be able to answer yours.

We welcome your feedback on this article. Contact us at inquiries@thesimpledollar.com with comments or questions.

The post How Should You Prepare For the End of the CARES Act? appeared first on The Simple Dollar.