Bad Seed: Russian Adoption Scandal

by Ouida on April 18, 2010

The stoy of Tory Hansen, a 33 year old nurse from Tennessee, and Artyom (Justin) Savelyev the boy Ms. Hansen returned to Russia is a story about which much has been said but little is actually known.  Google results for “Tory Hansen” and “Russian Adoption Return” yield few news stories with actual facts.  What we do know is the name of the adoptive mother Tory Hansen, the name of the adoptive child Artyom (Justin) Savelyev,  his age and the amount of time he spent with Ms. Hansen and her family before being returned to Russia.  We also know that the child was unaccompanied to Russia.  The media frenzy that has followed is shameful to say the least.  We have a psychiatrist on Fox News who, having never spoken with Ms. Hansen or examined the child, espouses that in our instant-gratification culture some people simply don’t deserve to be parents.  We have resorted to interviewing the taxi driver who ferried Artyom back to the orphanage and opined that the child looked normal to him.  And a Russian Ministry official has been quoted as saying “who would be afraid of a 7 year-old?”

No one except maybe, it seems, the child’s parents and extended family.

The New York Times editorial today entitled, “A Safe, Loving Home” at least admits that we do not know all the facts in this case.  Unfortunately the editorial also says, “But returning a child like he was a damaged pair of pants is profoundly wrong.”

Unfortunately, in our society, children have become commodities.  Prospective parents pay tens of thousands of dollars to infertility clinics to become pregnant.  When they finally do become pregnant, their pregnancies are termed “premium pregnancies” by their doctors and other medical personnel involved in their care.  A quick trip over to http://www.adoption.org shows that international adoptions may cost prospective parents anywhere from $7,000 to $25,000.  During the adoptive process parents attempt to find out everything they can about a child and that child’s potential problems before attempting to integrate that child into a new family.  But the due-diligence process is anything but fool proof.  There may be incentive on the part of adoption agencies and orphanages not to disclose fully and antisocial behavior may not manifest until some attempt is made to socialize a child.

Fortunately the New York Times also included the articles, “In Some Adoptions, Love Doesn’t Conquer All” and “Adopting With Care, And for Good.”  Adoptive parents seem to have a great deal of compassion for Ms. Hansen.  Shirlee Smith foster parent and  former chair of the LA County Adoption Commission urges that we exercise care when considering this case, that it is not uncommon for children born and adopted in the US to be surrendered back to their adoption agency and that prospective parents may not be given accurate or complete information about the child they choose to adopt.

I personally know “Sam” who adopted and raised 3 sons.  When Sam relocated to New Mexico, he adopted a forth son, Tony.  The boy was 12 at the time he came to live with his new family.  The adoption was a nightmare.  Each of the children suffered abuse at the hands of this new family addition.  Sam’s home was turned into a war zone. Furniture was destroyed, holes were knocked into walls.  Sam worked with Tony extensively, then finally surrendered him back to the state at age 15.  A sad story indeed.

A somewhat thoughtful discussion that includes input by international adoption expert Joyce Sterkel suggests that parents may have few options when an adoptive child is violent and that adoption agencies that suggest they do may be disingenuous.

Honestly, I wish Ms. Hansen or a member of her family had accompanied Artyom back to Russia so that we could focus not on the manner of his return, but rather the steps that the US and International governments and prospective parents should take to assess the psychological needs of any child adopted into the US.

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Why Pensions Rock

by Ouida on April 17, 2010

Okay, so like I am middle-aged and I have a high-stress job.  I am also a perpetual planner, so I have been sitting down, looking over the books and planning my exit strategy.

The traditional retirement plan that my company offered was a pension.  In the early 90’s my company did away with its traditional pension in favor of a hybrid, fractional pay pension coupled with a 401K.  I got in early enough though that I could have chosen the traditional all-or-none pension, which would have required at least 25 years of service.  There was a time when I couldn’t even imagine being 25 much less staying in the same place for 25 years. I opted for the hybrid system.

I finally sat down to figure out what my income will be at age 60 provided I don’t play with the money prior to that time.  Here is what I found:

1)   Continuing to contribute to my 401K after age 51 will only result in modest gains to my portfolio.  Why?  Because the bulk of gains occur with time, new contributions made after age 51 will not have had sufficient time to grow.

2)   Even if I hit my “number” and begin distributions at age 60, the monthly income result will be modest.  Remember this rule: Even if you manage to accumulate one million dollars in a 401K, that sum translates into roughly $4000 per month

3)   The pension component will be a larger contributor to my income at age 60 than my 401K!

Something has been bothering me.  Current retirement planning is based on planning for markedly reduced resources and reduced standards of living.  The rule of thumb is that people should set themselves up to live on 75-80% of their pre-retirement income.  That theory breaks down at the lower levels of income.  Should we tell a person making $30K that they should plan to live on $24K in retirement?  Current estimates are that it will take $250K to cover retirement costs alone in retirement.

In the Time Magazine article:  Why It’s Time to Retire the 401K, the author concludes that each of the people interviewed would have been better served by a pension plan.

Pensions cost the companies who run them a ton of money, but they are a great employee perk and from, where I sit today, they should be part of all retirement packages. I have already written about the perils of Social Security in an earlier post. Social Security is insolvent. Current payroll taxes intended to fund the program are being spent as part of general revenues.  Makes me wonder about the future of this social safety net.  Bottom line is pensions rock.  401Ks don’t.  The market boom of the 1990s that made so much 401K wealth possible is not likely to be repeated in our lifetimes.  The inflation-adjusted compound annual growth rate for stocks from January 1, 1989 to December 31, 2009 was 6.26%.  That assumes the investor was able to take full advantage of the 1990s market boom.  The inflation-adjusted return for the last decade? -3.42%.  It is hard for me to see how anyone with a family especially can hope to save enough to fund anything other than a meager retirement and after 30 years of working and “doing the right things”.  That truly sucks.

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The Accidental Salesman

by Ouida on April 15, 2010

This post is inspired by Maren Kate of http://www.escapingthe9to5.com Years ago

I was talking to a friend of mine, Ted, an entrepreneur whose background is in sales  about the need to constantly promote your business. Honestly, I have always been annoyed by people who carry business cards and have their wares constantly on display.  It is almost impossible to go out to dinner with these people!

Maren posted “A Day in the Life of an Entrepreneur” on her blog.  Part of her daily routine is that she networks to find 2 new business contacts a day.  When I read her post, it hit me.  Success in business is about consistent self-promotion.

Some time ago, I was at a Cloning of Success (COS) workshop held in John Assaraf’s home. One person at the conference had been at another Assaraf event 6 weeks previously and had approached him about nutritional supplements.  He became a customer of her nutritional supplements business. At the COS workshop she developed other business relationships with a plastic surgeon and others.  This woman was always moving her business forward and no prospect was too big.   I know that her business generates a multiple six-figure income for her and her husband.

Sales and promotion are activities that we are simply not comfortable with.  We think of sales and we think of the door-to-door Electrolux salesman, the car salesman who ignores the woman in order to talk to “her man”, we think of buying things that we don’t need only to feel guilty about it afterward and we think of the blustery, aggressive sales person who “just doesn’t understand my needs.”

The fact is this:  We are all in sales even if by accident.  Launch a website and you have to promote it, you can do it the cheesy way, by buying software that leaves spam ads on websites or you can develop relationships with people of similar interests and add meaningfully to the discourse on their sites.  Lose a job and you have to promote yourself to get another one.  In this economic climate I have been surprised by the tactics people have used to land another job.  People have used Twitter, Face Book, have started blogs, have researched companies and put together marketing pieces for free to help that business move forward.  All of these tactics have at their heart self-promotion.  Create a product or service and, well, you get the point.

Self-promotion is difficult.  Most of us, me included, would rather act anonymously, posting flyers, posting ads hoping that someone, anyone will respond.  It really doesn’t work that way.  Self-promotion is a high contact sport and that is just the way it is.

You don’t have to have sales training and become the thing you hate in order to become an effective self-promoter, but you do have to be transparent, genuine, authentic and offer value.  Adam Baker posted the sales numbers from his e-book, Unautomate Your Finances, on his blog, http://www.manvsdebt.com Johnathan from http://www.mymoneyblog.com posts his 401K port folio on his site and Chris Guillebeau of http://www.chrisguillebeau.com posts his earnings from his site on his blog.  If you like where these guys are coming from, follow them, if not don’t.  But there is no mistaking who these folks are.

In the time of social networks, blogging, article marketing, widely available Internet access, we have all become accidental salesmen.

What are you doing to move your business or idea forward?

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If How To’s Were Enough…I’d Be Really, Really Rich

by Ouida on April 13, 2010

Some years ago, Brian Klemmer wrote, If How To’s Were Enough, We’d Be Skinny Rich and Happy.  Klemmer said something that few of us want to face: having the instructions, knowing what to do is rarely enough, why because “something” can prevent us from accomplishing even the simple things of life, even if we know what to do.  I am more of a philosophy kind of gal.  Meaning I really want to have a thought  or an understanding about why I do what I do. Truth is, I can tell many people what to do to increase their wealth, save money, live frugally (although some of my more radical friends and acquaintances would say I am a frugal wannabe). Yes, I do reuse aluminum foil.  I am generally happy to share what I have done step by step.  But I have come to realize that knowing the step-by-step is really only part of truly knowing.  I cannot tell you the number of times I tried budgeting and paying off my debts until one day everything just clicked.  If you believe my mother (who has been spilling my dirty laundry on this blog as well) things clicked when I had to borrow her credit card to rent a car.  It wasn’t then.  Something else happened sometime much later.  I am always reading personal finance books.  Why?  Because  I want to keep personal finance ideas at the forefront of my mind. Why?  Because I have the attention span of a gnat.  If I don’t read a personal finance book for a while, I forget and run the risk of slipping back into bad habits.  There is that indefinable something that determines when we take action or not.  And knowing the how to is not that something.  To borrow a phrase from “Three Men and a Little Lady”, you cannot swing a dead cat without hitting a “how-to” book or article. How to books and articles sell and make beaucoup (pronounced boo coo) money. I was speaking with a friend of mine who is a recovering alcoholic.  He’s been sober for over a decade.  He knew the steps to sobriety long before he took them.  His something?  Driving home one night, not remembering how he got there and finding brush embedded in his bumper.  He told me that that experience isn’t enough for some people and they continue to drink until something else happens.  For me it was $80,000 dollars in consumer debt and the attendant dramas that went with it.  For others it is $1000.  For others those numbers are chump change and it takes more than a million dollars in consumer debt to spur them into action.  For some people it takes homelessness.  For others homelessness is a temporary inconvenience until they get another credit card.  When I started this blog I was going to write a series of “how to” articles.  Then I thought how can I do that when I understand full well that many will not be able to implement the steps because the time to make a change has not yet come.  It how to’s were enough, I’d be Billy G. because I would have flawlessly implemented what I read. If how to’s were enough I would make a mint writing how-to articles.  This isn’t about having a strong why!  Frankly, I would like to shoot the next person who says, “you just have to have a strong why to make change”  or “if you failed, you just didn’t have a strong why.”  The myth of the strong why simply puts people on the path of making value judgments about themselves and other people and the world is full of value judgments.  Where is all this going?  Well, we don’t suffer and disappoint ourselves for lack of knowledge.  There is that something else.  We could call it a habit of making poor choices, but that too is an oversimplification.  Truth is, lack of knowledge is rarely the problem.  It is that certain something else, that missing ingredient that lies within each of us that triggers action.

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