We Give Airbnb and Tiny House Living a Try

Hi everyone! After a series of short plane rides, we are in Ecuador now and having a great time together. We're staying in Cuenca, the second largest city in Ecuador, nestled up in the mountains in the southern part of the country. It's a cool city that's been welcoming to us, perhaps because of all the expats that seem to be here. The streets are beautiful, lined with old buildings and bordered with stone streets and sidewalks. It's a walkable city, too. Except for the ride from the airport, we haven't had to take a cab anywhere. I'll write a full review at the end of the trip, but today I wanted to write about our first foray into two new experiences for us: Airbnb and tiny houses.

Mrs. Done by Forty Negotiates Abroad...

One of the things I am getting used to here in Peru is being completely reliant on Mrs. Done by Forty. She's been to Peru several times before, each time visiting for a few months, at least. So she knows the culture, she knows where to go and how to avoid getting run over while getting there, and, most importantly, she knows the language. Sadly, I can barely put together a full thought in Spanish. But since she is very white with red hair and I am half-Filipino (and pass for a Peruvian at first glance), we have this ongoing confusing situation that happens. Everyone we interact with thinks that I'm the native speaker, and just starts talking to me in Spanish. It isn't until I stare back at them blankly and say, "¿Que?", and Mrs. Done by Forty starts talking in fluent Spanish, that they realize which one of us they need to talk to. Even if Mrs. Done by Forty starts speaking to someone in Spanish, they will just start talking to me as if I am the one who will understand them. It's kind of our ongoing joke now. Just yesterday when we were walking by a movie theater, some guy stopped me and asked me if this was the right line for "Thor". It was not a phrase I had practiced, so I had no idea what was going on...luckily Mrs. Done by Forty saved me again. (And yes, we did go to see Thor in 3D. Only 15 Soles..or $5.30.)

First Impressions of Peru

Hi, guys! Mrs. Done by Forty and I are safely here in Lima, which is bigger and faster-paced than I was imagining. We were trying to think about which American city we think Lima is the most like, and the closest we could come to was Los Angeles...at rush hour. It's a coastal city with temperatures that, at least now, fluctuate between a low in the 60s at night and highs in the 70s during the day. But with all the buildings, traffic, and constant honking, you wouldn't know there was a tranquil ocean within walking distance most of the time. It's a tricky city to get your arms around because it just keeps going: walk and walk and you just see more city. We're kind of smaller city folk. So while it's great to visit Lima and we are having a great time being together again, I don't think it's a place we'd want to retire. Lima is exciting, but it's also kind of scary at times. Here are some random tidbits:

Leaving on a Jet Plane...

Tomorrow morning, before the sun rises, I'll kiss my dogs goodbye and leave for the Phoenix airport. And before I go to sleep that night, I'll be in another country and back in the arms of Mrs. Done by Forty. We'll get two whole weeks together! One in Peru, one in Ecuador. While we're gone, I'll be logging in briefly and posting when I can. But I have to apologize to all my favorite bloggers, as it might be a while before I can catch up on your posts and comment. Sorry, guys! I will be reading, but it probably will be delayed. On the plus side, if there is anything you'd like me to write about covering either country (e.g. - local customs, negotiating abroad, using airbnb, etc.) just let me know in the comments and I'll try to put together a post on that.

They Want to Help You...

Over the weekend I sold an old DirecTV receiver on Craigslist. It had been sitting in our garage for over a year, back since the company sent out a new receiver model at my request. DirecTV told us we could just keep the old one. It was an older model and they didn't want it back. So it sat in the garage for months until, after changing my scooter's oil and spying the old receiver box in the garage, I thought, hey, why not sell this for some cash? I called DirecTV to verify I could actually sell the box and they said, sure, just take out the little card in front, and I was free to see what I could get for it.

Government Assistance and Backwards Incentives

The other day Stefanie, the author of a cool personal finance blog set in New York City titled "The Broke and Beautiful Life", wrote a post on unemployment and part time work. I loved the post because it was a detailed and transparent look at one woman's experience with government benefits. The part I found most interesting is how the system reduced her benefits ($251 a week, before taxes) by $63 in one week, as a result of earning just $40 after selling an article. In effect, by working, she actually reduced her income. Had she sold another article on another day that week, regardless of the amount paid for the work, her benefits would be reduced by another 25%. At that rate, the more she worked, the less she earned. This is a case of improper incentives: for every dollar Stefanie earned in this scenario, she lost more than a dollar in unemployment benefits. Rather than providing an economic incentive to work, the system is, in this case, ironically punishing the very behavior it wishes to encourage. So, unless employment with an income that significantly exceeds the weekly benefit becomes available (or if there is some other long term payoff, like a significant raise or health benefits), it makes little financial sense to accept the offer of work. It simply results in a lower income.

Embracing Either/Or and Opportunity Costs

Tonya at Budget and the Beach wrote a thought provoking article last month that, among other things, discussed the dichotomy of the "either/or" versus "both" approach. In a nutshell, she posited that when you are presented with two good options, there are benefits, especially as a freelancer, of choosing "both" rather than one or the other. The either/or mentality represents a self-imposed glass ceiling of sorts, that unnecessarily limits your potential. While I agree that having both is a great option, this post takes the counterpoint and argues the merit of choosing between two good options.

May Be Living In Peru for a While...

So Mrs. Done by Forty's research is going a bit more slowly than we'd planned. She is putting in crazy hours, usually not leaving to go home for the night until 10 or 11 pm. And she works seven days a week. Still, she is not progressing at the rate she needs to in order to actually finish her research by February. The bottom line is that it's likely that she'll have to go back to Peru for a second stint early next year. This poses a significant problem since this research is gathering the data for her dissertation but, more importantly, it means I might be away from Mrs. Done by Forty even longer. This isn't going to work because, readers, I really miss my wife. We're only a month in and I am hurting. Life is not going great without her. I'm not eating right, not sleeping right, I can't focus at work or on this blog, and the thought of even more time apart is a deal breaker. So, if things proceed like they are, I have to figure out a plan to go to go down there and work from Peru while Mrs. Done by Forty finishes up.

The Cherokee Land Lottery: What Happens When You Randomize Wealth

Back in August I wrote a post on Give Directly, a charity that simply gives money to poor people, and it sparked one of the better debates on the blog. CashRebel recently wrote a post on the subject as well, and he specifically asks whether such a program would work here in the United States. Would simply providing wealth to American familes have long term positive results? Would the lives of those families improve?

As interesting as these questions are, they are a bit academic. It makes for good debate, but how do you get data? Because even if you could give life-changing sums of wealth to people here in this country, it would take decades to see the long term impacts of that charity. Maybe generations. Wouldn't it be great if someone had performed a natural experiment about randomized wealth a long time ago, here, in this country? Well, thanks to an idea of Georgia politicians in the 1830s, an article by economic professors Hoyt Bleakley at the University of Chicago and Joseph Ferrie at Northwestern, and the excellent podcast from Freakonomics, we get to learn of a quirky and sad bit of American history. (And if you have thirty minutes, I definitely recommend listening to the podcast.) Their work reveals what happened when a huge sum of wealth was randomly distributed in the Cherokee Land Lottery.