Financial Samurai » diamonds

Someone Has To Give Birth! Why Women Shouldn’t Be Penalized For Being A Mom.

admin — Fri, 11 Dec 2009 09:00:36 +0000

Ouch

This post is dedicated to a friend of mine who is a single mother of one. She inspires me because of her will, her positive outlook, as well as her ability to do it all and never complain. I want equality for our mothers, daughters, sisters, girlfriends and wives. Don’t you? Best, Sam-urai

I was at a cocktail party the other night, and after several stiff vodka tonics, a female manager-level friend, “Julia”, began complaining about one of her staff.

She came up to me and said, “Sam, what am i going to do? Nancy keeps getting pregnant! She’s having her third child in the past 5 years, and now I’ve got to find cover for her again!” After Julia’s rant, she twirled her way to a slick looking fella at the bar and began chatting him up.

Initially I tried empathizing with Julia, given I do remember the feeling of having to cover for someone when they’re “sick“. But Nancy’s case is different. After all, someone has to give birth, and after seeing one too many sex ed video’s from the 9th grade with images of globulous placentas seared in my mind, i’m glad it’s not me! The Europeans would argue a 3 month maternity leave is not long enough given they practice a 6 month healing process.

Julia’s complaint brings us to the great debate:

Is it fair or even true that women are discriminated against and make less money than men on average?

“YES IT’S FAIR!”

Julia, the manager is a single woman, in her mid-40′s who absolutely believes hiring women is more expensive than hiring men. Interesting twist huh? Her rationale is that men never have babies, and therefore never take 3 months off. Women, on the other hand do, and yet Julia still must pay her 12 months worth of work. Julia explains to me that if Nancy had one more kid (making it 4), she’d have a full year off and be paid a full year’s salary! Julia also points out that she’s had two women resign on her after giving birth, causing her further stress.

Not only does Julia thinks it’s fair to pay women less, Julia believes Nancy’s absence is unfair to her colleagues who aren’t having babies, especially those who have to pick up the slack. Julia may pay Nancy for 12 months worth of work, but she might think twice about giving her the normal year-end bonus.

Julia argues that maternity leave is an optional benefit, and not everybody has the option to take that benefit because 1) not everyone is a woman, and 2) not every woman has children. Julia has worked for 15 years in the business and has never taken maternity leave.

“NO IT’S NOT FAIR!”

I, on the other hand am thinking, if a woman can carry a child in her womb for nine months while working, then go through a multi-hour labor ordeal, she should easily deserve 3 months off and be paid her full salary! My sister once told me giving birth for males is like trying to shoot a bowling ball out of our butts. I cannot imagine.

Females didn’t choose to be the ones to give birth, someone else did. Furthermore, if you asked all the men out there to switch places, the vast majority would say NO WAY. I guarantee it.

If I was the main colleague responsible for picking up the slack, I would be fine so long as I had a sit down with my manager explaining that I expect to be compensated appropriately, or that expectations of me should be altered given my dual roles. This then goes back to Julia’s point.

Do we take from Nancy’s income to pay someone for covering? If so, on paper, the incomes show inequality, but in reality some may argue compensation is flowing to where work is being conducted.

CONCLUSION

The income inequality gap has closed tremendously. But, i never really thought about the anti-equal pay argument from a woman until Julia stumbled up to me that fine night complaining. It’s generally managers secretly complaining about women, and new mother’s complaining about the unfair perceptions complaining folks have! At the end of that one night of passion, someone has to give birth eventually. And since that someone is female, they should get as much slack as possible.

Readers, what are your thoughts for why studies consistently show dissimilar pay between the sexes? Why does this gap persist if it’s true? What can we do to close the gap further? Do you think managers purposefully discount a newly wed woman’s pay because of thoughts she will start a family? What about the idea of extending paternity leave to balance things out?

Keiju,

Financial Samurai – “Slicing Through Money’s Mysteries”

Follow me on Twitter @FinancialSamura and subscribe to our RSS feed.

Diamond Engagement Rings Bling Bling!

fs — Tue, 21 Jul 2009 16:41:00 +0000

One of my good friends is getting married, and he asked me, “Sam, what on earth am I supposed to get her for an engagement ring?” What a question, that’s not easily answered. Generally, the right answer is “whatever she wants“! However, as we all know, sometimes ladies are harder to read than a children’s book in large print!

Before we begin, if any of you single guys out there want to attract the ladies, bust out the turquoise diamond ring guide book from Tiffany’s in any public space. The white book from Cartier will also do. I take the bus to work everyday, and I remember as soon as I took out the book from my bag, every single lady on the bus looked over. Just think, one of the great pick up lines to a staring woman could be, “Excuse me, but my friend asked me for his advice on this particular design (point to book), what do you think?” Clearly, if you use this line, you should not be proposing!

In the spirit of personal finance, let’s discuss some tips for buying an engagement ring.

TIPS FOR BUYING A RING

1) Decide between a name brand such as Tiffany’s, or a no name brand for 30-50% less. Only two things really determine this decision: What she wants, and whether you can afford it. Most people will tell you that buying a name brand ring is a waste of money, because diamonds are a commodity, and all come from the same mines controlled by DeBeers. Some women are aggressively against spending the premium. But, if your woman wants that Tiffany’s Legacy diamond ring, and you get her something else, she may secretly be disappointed. Finding out this basic viewpoint is tantamount!

Pros for buying name brand: Brand value resonates strongly with a lot of women and guarantees a minimum quality control involved. Tiffany’s, for example explicitly states they will only buy diamonds of exceptional clarity and near colorless or better. Furthermore, you have worldwide customer support, and a fun reason to always go to a Tiffany’s store.

Cons for buying brand name: 50-100% more expensive and people may think you’re wasteful for spending the extra money since we all know diamonds are a commodity, artificially priced due to a restriction in supply. Remember, the premium you spend could be used for other things, such as a nice honeymoon, the wedding, or good old fashion savings. Take a look at sites such as BlueNile.com, which has great tools in your search for the right rock at the right price.

There’s no right choice or wrong choice to this decision, just what your woman wants! It’s also worth highlighting “The Diamond-Water Paradox.” The paradox is that although water is essential to life, water is vastly less valuable than diamonds, which is non-essential to life. Some women might object!

2) The Four Cs: Cut, Clarity, Color, Carat!

Cut refers to the facet proportions on the surface of the diamond. The precise positioning of these facets determines the beauty of the stone. A proper cut with the right table, crown, pavilion depth, girdle, and symmetry will maximize the fire and brilliance of the diamond. The most common and desirable cut tends to be the “Ideal Brilliant Cut.”. You have to be most careful here, b/c independent dealers can really shortchange you with imperfect cuts, thereby selling you a diamond for more than what it’s really worth. CAUTION!

Clarity is essentially how clear the diamond is. Every diamond has blemishes of some sort, be it black carbon, inclusions, or chips. It’s ok to have these blemishes, but preferably not viewable to the naked eye. Who knows, you might get a massive discount if you can point out some small black carbon right inside a prong where nobody can see. The ratings from best to worst are: FL (Flawless) IF (Internally Flawless), VVS1-VVS2 (Very, Very Slightly Included), and VS1-VS2 (Very Slightly Included), SI1 (Slightly Included 1) and SI2 (Slightly Included 2). The best bang for your buck is VS1 and VVS2. Prices rise exponentially the higher you go.

Color goes from Colorless (D, E, F), Near Colorless (G, H, I, J), and Faint Yellow (K, L, M). The closer to colorless, the better. Forget about D and even E. Go for F, G, or H, as prices also rise exponentially in this department as well. You can’t tell the difference until you get to I. Get your diamond and cone a white piece of paper around it to see its true colorness. You’ll be surprised how pristine H color is.

Carat is the most recognizable aspect and commented on aspect of the ring. We’re talking as small as 0.18 carats to as large as 3+ carats in normal stores. One carat equals 0.2 grams. You can get your fiancé a 3 carat that’s cheaper than a 1 carat because of the lack of clarity, cut, and color. However, most women mention to me they’d rather have quality over carat size. One of the key things to note is that at every half-carat and 1 carat level, the price jump is huge. In other words, a 0.99 carat ring will sell for at least 10% less than a 1 carat, even if a 1 carat diamond is only 1% larger i.e. negligible. The same goes for 1.49 vs. 1.5, and 1.99 vs. 2.0 carat etc.

3) Understand what your girlfriend’s friends are wearing. If they all have 2 carat diamond rings with VVS1 clarity, and E color, well, it’s going to be tough not getting at least 1 carat with similar qualities. If her friends all have 0.5-carat rings, then getting much more than 1 carat may be poor form. Also, from the guy’s perspective, you don’t want to get your fiancé something so nice, that it makes your buddies look bad.

4) Use referrals. If you aren’t going to the established brand name stores, the absolute best and easiest way to go is through a friend’s referral. Obviously, your friend and his wife must be happy with what they have. People have been getting married forever, and dealers rely on referrals. If the referral is out of state, all the better b/c he can design or copy a ring, and ship it to you, thereby saving sales tax. Remember to always have the ring GIA certified as well.

5) Price. We must not ignore the cost of the ring. Women love to discuss what a man “should” spend on the engagement ring. Some believe the amount spent should be 3 months gross salary. Another woman, who comes from an extremely wealthy family, mentioned a ring should be flawless, and contain 0.1 carat for each year of age at the time of proposal. In other words, if she’s 28, then a 2.8 carat flawless and near colorless diamond ring for $80,000+ is what he should buy! Yeah right!

To put things in perspective, studies have shown that the average size and cost for a diamond ring is 0.4 carats and costs around $3,500. In big cities such as New York, Chicago and Los Angeles, the average carat size is closer to 1.6 and $25,000! The formula I propose all men and women to adhere to is that a man should spend as much as the present value of his automobile! If you’re driving a $100,000 Porsche 911 Cabriolet, well then off to Harry Winston you go for that 2.5 carat pink diamond! If you’re driving a 10 year old Honda Civic, then perhaps a $3,000, 0.3 carat, SI1, I color will do. How can your woman expect you to spend much more than what you’ve spent on your car? However, to not spend as much on the ring as you do your car shows that you are selfish and may love your car more than you love her! Women tell me this, so I have to agree. :)

6) Survey your colleagues. During my search, I surveyed every single woman on my floor about what they’d like so I could be in tune with what women want today. I thought they’d be more understanding, telling me to go with my gut, but instead, they were all very opinionated and all knew exactly what they wanted. “I want a minimum of 1.5 carats with D, E, or F in an eternity ring setting,” one female colleague insisted. Pretty intimidating, I must admit, but useful.

7) Investigate more. To get a basic idea of what my wife wanted, I would casually ask her what she thought of so and so’s ring, which would hopefully lead up to her revealing what she’d prefer. Everybody loves a nice surprise, but it is nearly impossible not to reveal a little intention, even if you ask her girlfriend to secretly ask on your behalf. Girls always talk, especially about engagement rings! This point goes back to point #1. We guys need to get her at least the basic cut and design of what she wants.

8} Finally, as soon as you buy it, insure it! Every single insurance agency has property insurance, and personal insurance policies for rings, watches, and other expensive things. Insurance isn’t that cheap. It’ll cost probably $30-40 bucks a year for every $1,000 you spend on the ring.

In conclusion, the ultimate way to save thousands on an engagement ring is to choose this combination: Buy a non brand name ring, 0.99 carats (or whatever carat just 0.1 below the half/full carat level), H color, VS1 clarity with no inclusions or carbon from an out of state dealer.

I have to imagine this combination is good enough for 80% of the women out there! You can’t really go wrong hovering around 1 carat, because that will straddle right in with the 0.5-to-1.5 population. Ladies, pls tell me if I’m wrong. Tiffany’s had their Novo style in this combination for $15,000 last year. My dealer could have got the same specs and design for $6,500 after tax. Who couldn’t use an extra $8,500? That $8,500 will be worth over $12,000 after 5 years in a 4% CD.

THE OTHER SIDE

One of my closest friends told me something interesting. He said, “Sam, we men should buy whatever we can get away with!” This may sound trite, but if a woman is happy with 0.8 carats to 1.3carats, then wouldn’t it behoove the guy to purchase the lower end of the range since she is happy with the range? Clearly, surprising on the upside is preferred. The more secure a man is with his girlfriend saying “yes”, the more he may think this way. The opposite may be true, for younger relationships.

I don’t claim to have the right answers, and at the end of the day, if your woman truly loves you, she’ll be happy with whatever you thoughtfully decide…. most of the time! If finances are tough, I would simply have an open conversation with her on how much you can spend and go from there. In this economic climate, I would even take a step back and simply give each other gold or silver bands and “upgrade” when things improve. Why do we have to go for diamonds anyway? Why not go for ruby’s or aqua marines? Unfortunately, there seems to be so much pressure from society for one to spend lavishly on engagement rings. I’m not buying into the extravagance, and neither should you if you’re serious about building your savings.

Readers, what are your experiences with regards to engagement rings?

Ladies, deep down, do guys really have to spend 3 months of their salary and get you exactly what you want or else?

Guys, any more tips on getting the best deals possible out there?

Is the whole engagement ring concept one big marketing gimmick to get us poor guys to spend all our savings?

Important note for women: If your man doesn’t make that much, absolutely know that he wants to give you the world. Most of the time, he just doesn’t have enough money. All he can do is research the heck out of the topic, and come as close to what he thinks you’d like within his means. If you still aren’t satisfied with what he gets, don’t say so, whatever you do! Instead, suggest that he spent too much money, and try and exchange for something cheaper (but really something different and more suitable to your liking, which may be cheaper). You can trick us this way. Engagement ring shopping is truly a segment guys want to do their best in, so effort must count even if we fail!

Keigu,

Sam @ Financial Samurai – “Slicing Through Money’s Mysteries”

Follow on Twitter @FinancialSamura and subscribe to our RSS or E-mail feed.