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Monday, June 26, 2017

Questions About Summer Parties, Tea Kettles, Cooler Cooking, Lifestyle Inflation, and More!

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. Helping nieces and nephews
2. Sharing costs for summer party
3. Making games for camping
4. Career advice for financial success
5. Americans have no savings?
6. Cooking in a cooler?
7. Electric tea kettle thoughts
8. Starting a Roth IRA
9. Bank password security
10. Toastmasters
11. Busy hours and lifestyle inflation
12. Expensive hobbies

It’s amazing to me how quickly the summer can drift by. It literally feels like just a few days ago that my children were still in school, yet now June is nearly over and their summer vacation is already slipping past.

I want to believe I have all the time in the world for the things that are important, but the truth is that none of us do. It’s easy to believe that there will be endless warm summer afternoons when your children are young so you can put off going to the park with them, but the truth is that they will grow up. There are only so many warm summer afternoons.

Today, I really should get some work done, but instead I’m going to go with my kids to the park. I’m going to spend the day with them under the summer sun. Maybe we’ll swing. Maybe we’ll go on trails. Maybe we’ll play soccer. Maybe we’ll roll down a hill.

Whatever we might do, this is going to be one warm summer afternoon when my children are young that isn’t going to slip through my fingers. My goal is to finish up this mailbag before they wake up and have breakfast, and anything else I don’t get to can be finished later.

Some things take priority, after all.

Q1: Helping nieces and nephews

I enjoy reading your site and other financial independence blogs. I recently sold my business for enough money that I am financially independent with a lot to spare. I am 48, single, childless, and never intend to have any. However I do want to help out my nieces and nephews. What is the best way to help them out? I don’t feel like I should just give them cash. Range in age from 4 to 26.
– Gavin

For the younger kids, the best thing you could do is quietly open up a 529 college savings plan for each of them. Name them as the beneficiary and stock it with whatever you feel is appropriate. Keep it quiet and only present that account to them when they reach college age so as to not disrupt other savings that their parents might be doing for them.

For the older kids, I’d meet with each of them individually and help them form a solid financial foundation. Wipe out some of their student loans or their mortgage. If they’re debt free, help them with a major purchase that they need, like a car purchase or a house down payment.

Keep in mind the tax rules for gifts. In general, gifts over $14,000 per year are taxed or count against your lifetime gift allowance (you can read the details here) so you may want to spread out any significant gifts over a number of years.

A gift of cash can easily be misspent, but it’s a little harder to misspend those kinds of investments. Yes, they might individually take the money that would have been directed toward a debt payment or savings and use it in other ways, but that’s going to be true no matter what kind of help you provide to them.

Q2: Sharing costs for summer party

Several of us are planning on having a fourth of July party with fireworks and food and beer. In the past some of us have been ripped off by having to shoulder most of the costs while others spend very little. Like some of us spend $200 on fireworks and other people spend $30 on meat. There have been arguments in the past. What’s the best way to get around it?
– Carla

The easiest way to get around it is to have one of you sit down and figure out a budget and then have everyone contribute an equal portion of that budget. If a person is handling just the fireworks, for example, they might pay for their portion but they should get some money from others to make up the difference.

So, let’s say you had eight people contributing and your budget was $200 for fireworks, $150 for food, and $130 for beverages (I’m just making up numbers here). That adds up to $480, so that would be $60 per person ($480 divided by 8 is $60).

If one person goes to get the fireworks, they need to get $140 from the others to pay for the fireworks (and then their $60 out of pocket covers the rest).

I wouldn’t freak out about being absolutely dead even on a thing like this, but everyone enjoying the festivities should be within $10 or so of each other in terms of expenses.

Q3: Making games for camping

Looking for cheapest way to have some yard games for camping to keep with camping gear. Is it cheaper to make your own corn hole set or just buy one? Backyard Jenga?
– David

If you have the woodworking equipment and a few other tools, most backyard games like corn hole and “backyard Jenga” can be made pretty cheaply. After all, corn hole is just two elevated boards with holes in them and backyard Jenga is just 48 identically sized wooden blocks. It’s not complicated stuff.

The thing is, the equipment that makes it easy to make games like that is expensive itself. It’s not worth buying a table saw just to make a game like this if you have no other real purpose for it. You’re better off just pricing out and buying it from somewhere.

Another approach, of course, is to make a copy with a friend who may already have some of this equipment, maybe in exchange for sharing some other skill that you have. Perhaps your friend might cut boards for backyard Jenga or corn hole while you sand and finish the pieces.

Q4: Career advice for financial success

I am a high school senior. I found your site through Google searches for career advice. I am trying to choose a major that will give me the best opportunity to retire early and earn enough from my investments to live the rest of my life on about $40K income. My parents did this in their early forties but they did it on the back of being early employees at [a large company] and getting out early too. It was kind of a “right place at the right time” thing. I’m looking for a career that lets me retire in my early forties like them. Suggestions?
– Stephen

The key to retiring early is to spend significantly less than you earn. There are a lot of factors in that equation – a big one, of course, is having a salary large enough that you can manage to live and still sock away a large portion of your salary.

Starting at age 25 and hoping to retire at 45 is a lot like starting to save for a typical retirement at age 45 – or even a bit later. Why? You’re essentially giving yourself 20 years to put enough away that you can live off of 3% of the balance.

So, let’s say you decide you need $30,000 a year to live. That means you need to have a million in the bank within 20 years (and actually more than that, given inflation). The only way to get to that number is to bank at least $35,000 a year. Assuming that you are also living on $30,000 a year, and also assuming that you pay taxes, you need a salary of at least $80,000 as a single person to make it. (The only way you reduce those numbers is to choose to live on even less than that, both now and in retirement.)

So, you have to look at career paths with very high starting salaries or else look at entrepreneurship and hope that you can start a company or get in very early with a company that grows quickly. You’ll probably want to be looking at engineering, computer science, or business school for salaries of that size, and you’ll want to match up those choices to your personal skills and your willingness to work in the field (because if you want to earn that kind of salary, you’ll be expected to bring some passion to the table – I’ve seen a lot of dispassionate engineers and business graduates working at gas stations).

Learn to live as frugally as you can in college and stick with those lessons after graduation. If you don’t, your lifestyle will inflate and all of these plans go up in smoke.

Q5: Americans have no savings?

Can this be for real?

http://money.cnn.com/2017/01/12/pf/americans-lack-of-savings/
– Jon

I absolutely believe that statistic. It matches almost everything I’ve seen in terms of personal finance.

For those who don’t want to click through, that article references a study that says that six in ten Americans (approximately) have less than $500 in savings. A quote: “Only 41% of adults reported having enough in their savings account to cover a surprise bill of [$500].”

Sometimes, the reality of how others live their lives can be absolutely shocking, but consider this: the average American household brings home only about $60,000 per year. That means half of all American households are operating on less than $60,000 a year. Many of them are operating on a lot less than that. When you start considering the cost to own a home, the cost to own and maintain a car, and so on, it’s not surprising that many, many Americans are walking a financial tightrope.

Unfortunately, for many, there isn’t really a way out of the mess. The option to quit your job and get training for something better doesn’t really exist if you have people depending on your income for food, and there simply isn’t any support out there for that kind of retraining.

There is no easy answer to that statistic. Many ignore it. Some propose pipe dream solutions. Others mostly spend their time criticizing those solutions. Meanwhile, I have friends with four children and a parent with a severe illness that had to use GoFundMe to keep food on the table this spring. They don’t live extravagantly – never have, never will – but financial reality has them in a death grip.

My only advice to people in that situation is to rely on family and take advantage of every tiny breadcrumb of opportunity that you have.

Q6: Cooking in a cooler?

Any thought on cooking in a cooler? My brother does this a lot. He will get out a cooler and heat up some water and dump it in there with some food in baggies and let it sit for hours.
– Matthew

Matthew wrote to me a couple of months ago and I honestly had no idea what he was talking about, so I put this question on the back burner until I could look into it more.

Matthew is actually talking about a style of cooking called sous vide. The idea is that you put food into a sealed Ziploc bag and then put that in a heated water bath at a consistent temperature for a long period of time to cook the food. The Ziploc bag holds the moisture of the food inside, making the food really moist.

The reason Matthew’s email came out of mothballs is that I actually tried this at a friend’s house. He used this method to make French fries. Seriously. He cut a bunch of potatoes into strips, put them in a baggie, tossed them in a cooler with some hot water at a temperature that he’d measured, then closed up the cooler and waited for most of an hour. He then heated up some oil, tossed in the fries for a very short cooking, and then pulled them out. They were downright amazing.

My friend told me that he’s done the same thing with chicken breasts and steaks before and it always turns out well. He cooks them in baggies sitting in hot water in a cooler for a long period of time and then throws them on a very hot grill at the end for a searing, then serves them. He claims it’s the best thing he’s ever tried.

So… I guess it works? It seems like something fun to try that wouldn’t cost very much. There are appliances that help with sous vide cooking that are quite expensive, but if you know how to measure volume and trust some basic calculations, there’s nothing going on that couldn’t be done in a cooler.

This is a great beginner’s guide to sous vide, if you’re curious.

Q7: Electric tea kettle thoughts

So my husband and I were talking to another couple. One of them drinks coffee in the mornings and the other drinks tea. According to them all they ever do is heat up a kettle of water in the morning by flipping a switch when they get up. She uses the water for pour over coffee and he makes tea. Why don’t people do this? Seems way cheaper than a coffee pot.
– Terry

Well, it may be cheaper, but it’s also more work. For pour over coffee, you’re putting coffee grounds in a coffee filter that inside of a special sieve. You then pour the hot water and let it drip into a cup or a pot. It’s a lot easier for most people to fill up a water reservoir on a coffee pot, hit a button, and wait for hot coffee.

However, I do have a friend who uses a tea kettle in the morning for her coffee. She uses a French press, which is basically a pitcher with some coffee grounds in the bottom. She puts the coffee grounds in, dumps hot water on top, then screws down a fine sieve on top (her French press has a large screw in the middle). At the bottom, this pushes down on the ground and forces the liquid coffee up through the screen. She swears by this and never buys coffee filters or anything. She just fires up a big electric tea kettle each morning and makes a few cups in her French press.

I think that the “typical” way of making coffee in a drip coffee pot is just one option among many.

Q8: Starting a Roth IRA

I understand conceptually how a Roth IRA works and I think I want to start one to supplement my work 401(k). I contribute enough at work to get the full employer match but I want to start saving about $50 a week more for retirement and I think a Roth IRA makes a ton of sense. But how does one go about actually STARTING one?
– Kevin

You can actually do it online. You just choose an investment firm that offers Roth IRAs, go to their website, and sign up. If you want someone to work with you on this, you can go to a local investment advisor, but you’ll be paying for something that’s really not very hard.

This means, of course, that your first decision is which investment firm. There’s a lot of variety out there. Some tend to have a lot of customer service and tools, but they usually have higher fees. Some pretty much just open the doors and let you dive in and sink or swim on your own and they charge lower fees. Some focus heavily on managed funds and have a lot of investors working for them – more fees. Some use algorithms or other tools to do most of the work – lower fees.

I use Vanguard. They definitely fall into the “low fee” end of the equation. They are not as hands-on as other investment houses in terms of helping you with every step (in my experience with Vanguard and with a few other firms), but they’re not “unhelpful” either. They tend to focus on index funds, which basically means the investments you get there are intended to match the market with as little risk as possible. They don’t try to “beat” the market. They do this by just buying a little of everything and riding the ups and downs of the overall market. I have also had good experiences with Fidelity. I can’t specifically recommend other investment firms for personal use, however, as I honestly don’t have personal experience with them.

Once you decide on an investment firm, opening an account is pretty simple. You just go to that firm’s site and follow the links and fill out the forms. It’s not too different than signing up for a 401(k), honestly. You’ll eventually have to enter your checking account information and set up an automatic direct deposit ($50 a week, in your case).

Q9: Bank password security

Worried about my bank account being hacked. I signed up for online banking but I am worried all the time about my account getting hacked into and all of my money stolen. Tips?
– Shana

Honestly, the greatest risk to your accounts comes not from your online banking account, but from transactions such as writing a check or using an ATM or from your bank’s mishandling of data. Those are far easier tools for hackers to use than to simply attack your online account.

The best procedure you can follow with your online account is to keep virus protection running on your computer at all times and to use smart password guidelines. Make sure that your password isn’t a common word or phrase, that it has a mix of uppercase and lowercase letters and numbers and symbols, and that you can easily remember it. You should also change your passwords on your important accounts regularly.

Once you’ve done that, you’ve essentially done everything you can to secure your account. It’s a good idea for everyone to keep an eye on their accounts and make sure that bogus transactions don’t start appearing.

Q10: Toastmasters

Do you think Toastmasters is worthwhile? Saw you mentioned it before. Seems like a scam to me.
– Dennis

I think Toastmasters is a very good organization that’s great at helping people get their feet wet at public speaking and learn some of the mechanics of public speaking in a friendly environment.

Having said that, I think there is a limit to how useful and effective that it can be. There’s a cap, in other words, on what you can learn there, and to go beyond it, you have to start public speaking in “real” situations and learning from the feedback you get from there.

In other words, look at Toastmasters as a social club and as a tool for learning how to speak well in public. It can also help build some leadership skills. However, it won’t push you directly to situations where you’re earning thousands of dollars per speech.

Q11: Busy hours and lifestyle inflation

My work hours have jumped from about 40 hours a week to about 70 hours a week without salary bump yet (grumble grumble). Anyway my real challenge is lifestyle inflation. I find myself with a lot less time and I am falling back on paying people to do things for me that I would otherwise do myself like buying takeout and using the landlady’s laundry service (she owns three properties and will do laundry for a fee). Sometimes I Uber home from work instead of taking the train because it’s faster (but a lot more expensive). Looking for some suggestions on balancing lifestyle inflation and these crazy hours so that I’m not just working to stay in place.
– Ken

First of all, you need to decide if this commitment to 70 hours per week without any sort of salary increase is going to be a lasting thing or not. If you’re receiving additional pay for it, then paying for a few services to give you back some of that time is sensible, especially if you’re paying less than your salary increase and the job is actually building your career. If you’re not getting paid more, you should consider shopping around for new work.

Let me be clear: I don’t have any direct problem with people working that much. My problem is with an employer essentially doubling someone’s workload without compensation. That means you’re effectively getting a 50% per hour wage cut and that’s unacceptable.

In the short term, until you either get a higher wage, go back to more normal hours, or get out of there, such services might be sensible. My number one tip for you is to get a slow cooker and use it to prepare foods for yourself. Leave it out on the table with a soup or something delicious in there and let it cook slowly for several hours while you’re gone. Given your long hours, a timer might be appropriate.

This way, you can eat meals at home at your convenience, meaning you have lower food costs and more time at home.

If the laundry service rate is reasonable in price, that’s not the worst idea in the world. Even I might consider a well-priced laundry service that dropped off and picked up clean folded clothes at my door.

Q12: Expensive hobbies

How do you let go of expensive hobbies that you love dearly?
– Jenny

It depends on how exactly those hobbies are expensive. There are different types of “expensive.”

For example, I dearly love many kinds of tabletop games that are unquestionably expensive. I stay in those hobbies by budgeting my money, rolling over older items that I no longer want into newer items, and trying to enjoy what I have as much as possible. This works well for many hobbies where the expense is heavily tied to “stuff.” For other hobbies, where the expense is tied to paying for experiences, like golf green fees, it’s a bit harder. It involves a lot of bargain hunting and, generally, they’re just hobbies to drop or to indulge in rarely if you’re trying to stay on budget.

So, how does one let go of a hobby based on expensive experiences, then? Things like golf or going out to restaurants or eating fine cheeses or drinking fine wine? My honest advice, based on my own experience, is to drop them cold turkey for a while and then indulge in them only rarely. I used to golf on an almost weekly basis, but I dropped that hobby entirely for several years and now go only once a year or so (and usually at a low-cost course). I used to go out to eat at expensive restaurants fairly often, and now it’s an extremely rare event.

What I found is that burying myself in other interests helped a great deal. My financial turnaround turned me on to a lot of new hobbies that I find really fulfilling. So, instead of just sitting at home and brooding, try all kinds of things. Go to Meetups and dabble in all kinds of hobbies, especially stuff you would have never considered before. You might be shocked as to what clicks with you. I mean, I’ve played tabletop RPGs with people of all ages – I mean literally ranging from 6 to upper 70s – for example. Don’t cut yourself out of new hobbies. You might just find something unexpected that really clicks with you.

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.

The post Questions About Summer Parties, Tea Kettles, Cooler Cooking, Lifestyle Inflation, and More! appeared first on The Simple Dollar.

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Sunday, June 25, 2017

Why I Quit Caring About My Credit Score

If you believe everything you read about your credit score, you’d think it was the most important component of your financial health. Without a good credit score and history, the experts say, it’s more difficult to qualify for a mortgage or car loan – and more expensive, too, because you won’t get the best interest rates. In many states, bad credit can even raise your insurance premiums, cost you a rental apartment, or make it harder to get hired.

While all of that is true, it doesn’t tell the whole story.

First off, there are several credit scores out there. While it’s important to nurture your credit scores by using credit responsibly, your FICO credit score could be different from the one VantageScore reports, and lenders may use a different one entirely — so obsessing over one score can be a fruitless exercise.

More importantly, as Dave Ramsey famously notes, your credit score is not a measure of your financial health at all.  “All it tells you is whether you are good at borrowing money and paying it back. That’s it,” says Ramsey on his blog.

Think about it. There are few ways to build credit without borrowing money. While your credit is undoubtedly important — especially when it comes to achieving certain life milestones, like buying a home – your credit score doesn’t necessarily dictate whether you’re “good” with money or wealthy at all.

Six Reasons I Stopped Worrying About My Credit Score

With that in mind, I stopped caring about my credit score a few years ago. I do track my score and new accounts opened for free on Credit Karma, but that’s mostly just to prevent fraud and identity theft – not to judge my score.

Here’s why I just can’t care anymore:

I would rather be debt-free than have a perfect credit score.

FICO, the most popular credit scoring agency, uses several weighted factors to determine your credit score, including payment history (35%), amounts owed (30%), length of credit history (15%), new credit (10%), and credit mix (10%). Believe it or not, these rules make it so you can be penalized for becoming debt-free!

My husband and I have enjoyed steady credit scores above 820 for a while now. But when we paid off one of our rental properties earlier this year, we both saw our credit scores drop by 20 or more points. The sudden drop took place because we paid off a 15-year loan and reduced the average length of our credit history tremendously. In other words, because we paid off and closed a line of credit, our scores took a hit.

That’s a racket if I’ve ever heard one, and yet another reason I refuse to worry when my score fluctuates. I would much rather be debt-free than keep my credit score hovering in the 820 range.

I want to make decisions based on what’s best for our family, not on what is best for my credit score.

Taking that one step further, I refuse to let my credit score dictate our financial lives. If I had been overly worried about my credit score, I may not have worked so hard to pay off our rental property early. Perhaps I would worry about prepaying our home mortgage as well, and quit making extra payments there, too.

At the end of the day, I know what’s best for my family — and it’s not carrying around a bunch of debt for the next 20 to 30 years. So, I say to heck with my credit score; now that one of our rentals is paid off, we’re working hard to pay off our primary residence and our other rental as quickly as we can. If our scores drop when we pay off our primary residence, so be it.

If I don’t have the cash, I can’t afford it.

Admittedly, I realize it’s easier to ignore your credit score when it’s a good one. A lot of people might question what I would do if my credit score took a sour turn once we become entirely debt-free. What happens if I need to finance a new car, for example?

The thing is, I have zero intentions of borrowing money ever again. If I don’t have the cash, I can’t afford it… period. That rule applies to vehicles, vacations, home remodeling projects, and any other expense you can dream up. And really, I would rather drive a skateboard than have a car payment ever again.

I own my own home, and have no plans to move.

While you should pay special attention to your credit score if you plan to buy a home, those of us in our forever homes may not need to worry too much. We’re in the home we plan to raise our children in, and we now owe a lot less than half our home’s value. As a result, we never plan to move. And if we do move in the very distant future, we should have the cash to pay for our new home in full.

We have a healthy emergency fund.

When it comes to maintaining debt freedom, having a healthy emergency fund has been huge for us. While the size of our e-fund ebbs and flows based on our earnings and the time of the year, we frequently have more than six months of cash expenses to use in emergencies.

Because of our emergency fund, I don’t need a boatload of credit at my disposal. I use credit cards to earn rewards, but we’d be fine if our accounts were cancelled for any reason, including lack of credit or a waning score.

A FICO score over 720 has diminishing returns.

To qualify for the best rewards credit cards, a home mortgage with the lowest interest rates, or personal loans with the best terms, you usually need a solid job history and income, a record of responsible credit use, and a FICO score of 720 or above.

You know what you get for a FICO score of 800? Or 850? Honestly, not a lot more.

When it comes to your credit score, there’s a point of diminishing returns. While earning and maintaining a good credit score is absolutely a smart move, there’s no award for a perfect FICO score – no cookie, no trophy, no nothing.

Final Thoughts

Your credit score is important – especially when you’re first starting out. But once you’re fairly established financially, it’s much easier to see credit for what it really is. As Ramsey says, your FICO score is nothing more than a measure of how well you borrow money. That’s why it’s possible for people with mountains of debt to still have extremely high credit scores.

As for me, I just can’t care about my score anymore… and I refuse to play the game. While an 850 FICO score is something to be proud of, I’d rather be wealthy and debt-free.

Holly Johnson is an award-winning personal finance writer and the author of Zero Down Your Debt. Johnson shares her obsession with frugality, budgeting, and travel at ClubThrifty.com.

Related Articles:

How much attention do you pay to your credit score? Do you think it’s important?

The post Why I Quit Caring About My Credit Score appeared first on The Simple Dollar.

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Saturday, June 24, 2017

I Am Not Making This a Priority in My Life

It’s a pretty regular routine in my life.

I see something I want to change in my life. I think about it. I come up with some kind of plan for that change. I become thoroughly convinced that this is the right way to go.

I start making that change in my life… and then, before long, it fails.

Sure, there are always excuses.

There was a big family reunion! It was the holidays! I just couldn’t pass up those bargains! My life is just too busy right now for this! I was so sore! I was so tired!

Do you want to know the real truth of almost every one of my failures?

I am not making this goal a priority in my life.

When I spy a big bargain on something that I vaguely want and whip out the credit card, I am not making financial independence a priority in my life. I am choosing something else to prioritize.

When I abandon an online class because I’m just too busy for it right now, I am not making self-education a priority in my life. I am choosing something else to prioritize.

When I stop going to the gym because I’m sore or I’m tired, I am not making physical fitness a priority in my life. I am choosing something else to prioritize.

When I spend a bunch of money on hobby supplies for some new hobby I’m suddenly into, I am not making financial independence a priority in my life. I am choosing something else to prioritize.

When I choose to pig out during the holidays, I am not making calorie control or weight loss a priority in my life. I am choosing something else to prioritize.

When I choose to sit around the campfire and drink several beers with extended family members at a reunion, I am also not making calorie control or weight loss a priority in my life. I am choosing something else to prioritize.

The mistake that I repeat over and over again is a mistake of prioritization. I decide to take on some big initiative in my life and I find that it’s easy when no other priorities in my life step up to the forefront, but when something else does come up, I’m suddenly distracted and I walk right away from my supposed “priority” of self-improvement.

Over and over in life, this abandonment of priorities I’ve considered in favor of an alternate priority that pops up in the moment has been the source of my failure to achieve goals. It’s created a long road of discarded goals and ambitions, leaving me in many areas with a life that I’m unhappy with.

The sad part? Most of the time, my quickly shifting priorities and abandonment of goals didn’t have to happen.

I could have enjoyed my hobbies without dumping out a bunch of money on extraneous supplies.

I could have enjoyed time around the campfire with my extended family without drinking a six pack and tossing aside all food discipline.

I could have enjoyed a holiday treat by simply being careful at other meals instead of just tossing everything in the general direction of my mouth.

Again and again, looking back, I can see a pathway through a priority conflict that allows me to stay on top of my goal. But then, again and again, I allow my priorities to get out of whack and I find myself abandoning goals because of some new perceived priority in the moment.

At this point in my life, I feel like I’m finally riding a wave of success in several areas beyond my personal finance success, which itself hasn’t been perfect (I don’t really want to get into the details quite yet, but I hope to write about some of them soon). In each case, it’s because I’ve truly committed to making some particular change into a true priority in my life.

What’s changed? Here are the strategies I’ve been using to set better priorities for myself.

I spend significant time each day reflecting on the day that’s passed and the day to come.

Journaling has always been a part of my life, but for many years it was basically just a very brief log of the top two or three events of the day.

Over the last few years, however, it’s morphed into something much more. I now use it as a time to really reflect on the previous day and the upcoming day. I try hard to look at what has gone well and what didn’t go well, and how I can have more positive results in my life.

I carry this thinking to the downtimes throughout my day, like when I’m going on a walk or when I’m driving home from dropping a child off at a practice or when I’m waiting at a doctor’s office.

One thing that I really focus on during these reflections is making sure that the things I’m doing are in line with the big things I want out of life. I want to be financially independent. I want to be mentally and physically healthy. I want to have strong family relationships and many good friendships. I want to have a strong understanding of the world. I want to be a positive influence on my community. Those are my priorities, so I try to filter my recent choices and actions through those priorities.

When I ate lunch, did I choose things that encourage physical health? Did I take some time today to improve my fitness? When I went to the store, were my choices in line with seeking financial independence? Did I make any bad choices when I visited Amazon and bought a couple of items? Did I really do anything to improve my social relationships or the health of my community when I was at that meeting last night?

I try to think about those kinds of things. If I didn’t succeed, I try to dig into why I failed and what I could do better; similarly, if I did really well, I try to glean lessons there, too.

Applying reflection time to personal finance priorities Get into a habit of reflecting on your recent choices through the lens of working towards your money goals. Do it when you’re driving to work or driving home or waiting on something. Just consider some recent decisions you made, whether they really made any sense, and whether you could have made better choices.

For example, when you’re driving home from the grocery store, go over some of the things you bought in your head. Was that a good choice? If your gut is saying no, dig into that a little bit. Why was that not a good choice? What should you have done instead?

Remember, this isn’t supposed to be negative. You shouldn’t beat yourself up with such thoughts. You’re human and your decisions are going to be imperfect. The goal is to be slightly better next time so that gradually you move onto a better trajectory.

I personally find that spending some time journaling each day – reflecting on your day and asking these kinds of questions while actually writing down your thoughts – is really useful. It forces you to think slowly and really reflect on things and translate them into the organized thought of the written word.

I remind myself of the key priorities I’m focusing on several times a day.

Another powerful way to keep your priorities front and center is to regularly remind yourself of the things you’re working on in your life that you want to prioritize.

What I like to do is run through something of a list of my priorities first thing in the morning. I’ll think about my financial progress and what I’m aiming for. I’ll think about my health and what I’m trying to do with that and how it’s a priority for me. I’ll reflect in that way about many different avenues of my life.

I find this to be a very positive and uplifting thing and it leaves me feeling good, because I always include a thought related to the progress I’ve made. I think about my negative net worth several years ago and where I’m at now. I think about my weight and health in the past and where I’m at now. I think about my relationships similarly. I cap that off with a recognition that these things are good – and they feel good – because I have made them a priority in my life and I want to keep it that way.

I try to do this at least a time or two during the day – again, I try to utilize mental downtime for this kind of reflection. I’ll do it when I’m using the bathroom or when I’m loading the washing machine or when I’m stretching. I’ll just think about my priorities, the success I’ve found because I’ve made those things priorities, and then quickly think about how my commitment has made all of those good things possible.

Applying mental reminders to personal finance priorities Consider your lowest personal finance point and how you’ve improved since then. Maybe you were in debt up to your eyeballs and scared to pay the bills. Maybe your net worth was in the negative six figures. Maybe you didn’t have a job and feel hopeless.

Consider, though, that things have notably improved since then, and a lot of that improvement has come from setting better priorities. Think of how much better your current situation is than where you started. This is powerful even if it’s just been a short time, because you can easily multiply those positive effects.

Feel good about that success, because you should feel good about that success. Then, recognize that it comes from making good financial choices a real priority in your life and commit to keeping it up.

Making that thought process into a regular chain really embeds it into your thinking and you begin to naturally prioritize such things.

I do my best to look ahead for possible conflicts of priorities and think them through before they happen.

Sometimes, it’s quite possible to be aware of situations that might really challenge your priorities, and when you can see them coming, it’s worth your effort to consider them in advance.

Let’s say, for example, that I know we’re going to a place tomorrow where I’m going to be tempted to spend more money than I should – maybe a bookstore or a home brewing store, whatever. I’m aware that when I’m in there, I’m going to have a conflict of priorities. My priority of financial independence is going to come into conflict with my priority of enjoying a particular hobby and having higher quality leisure time. In that environment, the leisure priority is going to be surging and I know this right now.

So, what I’ll do right now about it is that I’ll think through that shopping trip and I’ll visualize myself choosing my financial independence priority. I might have budgeted for that stop, so I’ll just visualize myself staying within my budget – $20 or whatever – or I’ll visualize myself spending nothing at all. Maybe I’ll see a great book! What do I do? I just picture myself writing down that book’s title and getting it at the library. What if I see a sale on homebrewing supplies? I think about the fact that I already have plenty and I visualize myself simply skipping over that sale.

Another example: let’s say I’m about to go to my in-laws for the holidays and my mother-in-law always makes a small mountain of tasty treats and a bunch of delicious meals. Not only are they tasty, I want to be polite and try some of them, too. But they’re calorie bombs and I’m trying to watch my caloric intake. In that environment, my priorities of watching my calorie intake are going to be in conflict with my priority of enjoying the pleasure of good food and my priority of establishing good relations with my in-laws. I know this conflict will happen, so what do I do?

I simply think of a plan where I can balance these priorities and not violate my health priority and then visualize myself doing it. So, maybe I’ll eat a few treats and eat a hearty meal when the whole family is gathered, but then eat small meals when the meals are simple and unimportant.

Applying conflict prediction to personal finance priorities You can use this technique any time you see a potential spending temptation in your future. Simply think about it now and visualize yourself making the choice that’s really in line with your top priorities. Figure out what you’re going to do in that situation, then picture yourself going to that store or on that trip, but you’re enjoying the experience and simply keeping your wallet in your pocket or purse.

This can be folded into a daily journaling or reflection practice. Simply look at the day ahead of you and see if you’re going to be in situations where your priorities might come into conflict or your key priorities might be challenged, then think about those situations with an open mind.

I’ve intentionally considered some of my secondary priorities and realized that they are, in fact, secondary ones.

Another element to consider in all of this is that we often don’t have our priorities organized in any real way. Sure, we might understand that a very minor priority, like watching Monday night wrestling live every week, is overshadowed by a major priority, like being involved with our children’s lives and attending their piano recitals, but when it comes down to other conflicts, the relative importance of different priorities in our life isn’t always clear.

Spending some time thinking about those kinds of issues, then, is actually quite useful in terms of making sure that your top life priorities stay on top.

Let me give you a clear example of this. For me, it’s a priority to spend at least one evening a week on leisure activities. It’s important for me to never, ever fall fully into the “all work and no play makes Trent a dull boy” trap. I came close to that in the past, so I know now that leisure time is vital for my well-being.

However, there are priorities that do come in above that. My family is one.

Typically, Sunday evening is the one evening each week that I devote to pure leisure time, but when there’s a family event going on then, like my oldest son’s participation in a soccer tournament, I have a priority conflict, but my family priority wins out. What then typically happens is that I look for ways to fulfill the other priority. Is there another evening this week I could have an evening devoted to hobbies?

The thing is, I’ve thought about that priority conflict in advance of it ever happening and I know where my priorities lie. I know that my leisure evenings are a secondary priority for me and that my family is a primary priority.

Evaluating quite a few conflicts in that way has actually caused me to have a pretty clear ordering of most priorities in my head. I know what things important to me trump other things of relatively less importance to me, and I can use that relative importance as a guide.

Another important factor is truly understanding that priority. When I say that my family takes top priority, I mean that it takes top priority in terms of using my time when they need me or strongly want me and in terms of making sure their basic needs are met. That doesn’t mean that I use “family” as an excuse to spend $10,000 on a huge mind-blowing vacation because it’s what my “family” needs. My family does not need a $10,000 vacation – that’s not really what I’m prioritizing when I put my family first. I’m not prioritizing spending hundreds upon hundreds of dollars on sports gear or electronics or equipment for their interest of the week. I do prioritize spending some devoted family time each and every day, however.

It’s only with that kind of understanding of what your priorities mean that you can truly “rank” them and clearly understand that some are more secondary than others. An expensive family vacation that isn’t extremely well planned for and budgeted for is a very, very low priority because it’s not a part of that “family” priority. A family vacation that’s reasonable in price, like a camping trip to a national park, is much more of a “family” priority because the focus there isn’t on some sort of incredible expensive experience but on spending time together doing something new, which doesn’t cost money and is the portion of a trip that’s really in line with “family.” Again, it’s about prioritizing different aspects of your life, and to do that, you have to really understand what you’re prioritizing.

Applying priority ordering to personal finance priorities How important is financial independence (or whatever your specific financial goals happen to be) to you? How does it compare to, say, spending time with your family? How does it compare to, say, buying every little thing your family might want even though you have more than enough stuff and more than enough things to do? Recognizing that “spending quality time with family” and “spending money on more family stuff” are different priorities and thinking about them in relation to your personal finance goals is vital here.

So, take the time to not only think about your priorities, but what those individual priorities really are. Tease them apart so that you’re left with the elements that are truly important and the ones that aren’t (I find that time use and money use, for example, are often very separate priorities).

Final Thoughts

So often, we let secondary priorities take control of our lives, pushing our primary priorities out of the way. There are a number of reasons for this – we haven’t thought through the relative priorities, we convince ourselves that unimportant things actually have a priority, we don’t keep our priorities in mind – but we can gradually learn to handle all of those reasons through techniques like thinking about priority conflicts in advance, figuring out what it is we truly care about, and reminding ourselves of our top priorities.

Use those tools. They’re incredibly powerful ones if you take them seriously.

Good luck!

The post I Am Not Making This a Priority in My Life appeared first on The Simple Dollar.

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Friday, June 23, 2017

Some Thoughts on the Choices We Make When Decorating Our Homes

I was recently made aware of a fascinating business called Books by the Foot. This business buys bulk books from publishers and libraries and other sources that might otherwise just throw them away and then sells them by the foot for people who want to create the visual appearance of having a giant library of books. In some cases, this does make sense – a person making a film or a theatrical production might want this very kind of prop (though I know from experience that many of them just have these “prop” shelves of books that are basically book spines glued to boards that they can just slip right into standard bookshelves).

But why else would someone patronize this business? Well, I got another big clue from this article in the Paris Review, entitled When You Need Ten Feet of Books. The story starts off with this anecdote:

“I once knew a man who bought antique books by the foot to fill the majestic library of a new house. He was completely unembarrassed by this fact, which is, I guess, the only way to be, and there was something very eighteenth century about the whole thing. (On close inspection, a lot of them proved to be bound sermons, in many volumes.) The idea of insufficient books to fill shelves is a novel idea to most apartment dwellers, certainly in New York. I was, therefore, fascinated to read about the Strand Bookstore’s Books by the Foot program, in which the New York institution furnishes volumes for films, magazine shoots, private buyers, and, presumably, decorators.”

At first, the idea of simply filling shelves with books that weren’t selected with personal interest in mind and done mostly for decoration seemed bizarre to me. I find shelves of books to be aesthetically pleasing, but it’s because those books represent titles chosen by the owner and is a reflection of their personality and interests.

Then I stopped for a second and really thought about it. Most of the books in our house are out of sight of guests, but there are definitely some spaces where we have some books on display and, often, the books on those displays are chosen in terms of what they represent to others. I’m much more likely to put ten books that I think are impressive on that shelf rather than the last ten books I happen to have read.

Why? On some level, the reason we have many items in our home is to impress others. We want others to see our bookshelves and think, “Wow, that dude… he’s reading some good stuff!” We want others to see our music collections and think, “Wow, she’s got some seriously good taste!” We want others to look at our wall hangings and thin, “Now that’s interesting!” or “That’s so sentimental and wonderful!”

The truth is that if I designed my house solely in a way that made me happy, I’d probably be afraid to invite most people to my house. Sure, I might invite certain people over, but I’d be disinclined to have people over. I would look like some guy obsessed with fermenting foods (as I’d have several shelves with jars of foods in brine) and obsessed with weird overly intricate board games with a taste for really really odd books and a fetish for pens. Honestly, it wouldn’t be very inviting to guests in my home and would create a strong but inaccurate sense of how I want to interact and socialize with people.

Here’s the real question, though: why am I choosing to display some things and not others in terms of decorating my home? Why do I choose a shelf full of books – and why do I have particular books on those shelves? It’s because, in the end, how we choose to decorate our house when we have guests over is part of how we present ourselves to the world, and we want that presentation to be positive. That’s why people often clean up in a hurry when they know guests are coming over – they want to have a nice presentation for the world and not necessarily a fully accurate one – and it’s the same reason why we choose some home decor options and not others.

With that in mind, I started looking around our home at some of the items we have on display for guests to see. We have an expensive china cabinet that looks nice, but we rarely use it. It’s a display case for stuff. There are items in that china cabinet on display that we rarely use, too. I see all sorts of little things on display like that – they’re nice, but do they actually represent much about us? Are they functional in any way?

When I look at our wall hangings, I find that some things really fill me with positive feelings – an old Bob Ross-style painting my great grandmother made that I’ve always liked, another beautiful painting of a glass vase spilled on a tabletop that’s done by my great aunt who is a seriously talented artist, family photos, photos from our travels, some of the books on the shelf, and our toy shelf (because I love that it makes children feel welcome).

Other decorations don’t really feel me with anything. They’re just items bought from a store that do express some sentiment that I agree with, but it’s about as impersonal as that sentiment can possibly be. What does this really express about me or about us? Very little.

Here’s the thing – I want the things that decorate my home to express me in a way that I want the world to see, and the truth is that most of the really effective ways to make that expression aren’t very expensive.

When I look through my house and see the things that are really meaningful, they’re almost all gifts from loved ones or expressions of experiences I’ve had. I have paintings that loved ones have made or photographs or simple reminders of great experiences. Those things are things that are meaningful to me and that I’m happy to share with others who enter my home.

Many of the other things? They’re just… there. They look fine, but they were an investment of money just to fill wall space. They don’t express any real meaning. Simply expressing a sentiment that I agree with isn’t enough; simply looking pretty isn’t enough. There are infinite things that express shared sentiments. There are infinite things that are pretty. Why spend money on them unless there’s something deeper and more meaningful?

Over the last few weeks, I’ve started to change this. I’ve taken down some wall decorations that weren’t meaningful to me (or to Sarah) and replaced some of them, mostly by reusing old frames and putting in photographs of our travels. I’ve started to switch out many of the items that we store in our china cabinet – again, working with Sarah to make sure that I’m not moving anything that is meaningful to her.

What I’m finding, again and again, is that the meaningful things I’m adding are very inexpensive. I’m far happier with a $5 photo in a simple frame or a found item from a trip or a map with tacks on it depicting our travels as I am with an expensive decoration from the Pottery Barn. Why? This stuff means something to me, and it’s something I love sharing with others. It’s also mostly inexpensive because it’s centered around experience and ideas and feelings rather than the material itself.

I get far more value and pride and happiness out of a simple frame containing a photo of a great experience or a great location I’ve been to than I get out of a $50 wall hanging from a home decor store. I get far more value and pride and happiness out of an unusual item my grandmother gave me after one of her travels than I get out of a $100 decor item from Pier One. I’m far more excited to show off a simple plant that came from a start off of a plant that Sarah’s aunt once owned than I am to show off a beautiful vase in the corner. I would way rather display a painting from my great grandmother that I love than a $500 print from a known artist.

If my home decor is meant, at least in part, to show the sides of me that I want to share with the world, then it starts with the experiences I’ve had and with the people I love and with the things I’m passionate about. I don’t find those things in the home decor section at the store, aside from a simple frame for a photograph or another item. I don’t find those things even in an art gallery, as those things are often beautiful and do speak to me, but they’re not by me and for me and ought to be shared with the world.

I challenge you to do this simple experiment. Go through your home and look at everything that a guest might see when they visit. What does that item really say about you and what you value and what you want to share with the world? Yes, some things are there because of functionality, like a couch, and you probably want it to look good, but what is the meaning behind that vase or that hutch? What does it contain that has real meaning for you that you want to share with people who visit you?

You may conclude that most of the items you have on display really are good choices that express what you want to show to the world, but you may come to some valuable conclusions about things you may choose to buy in the future and the changes you may want to make. May those choices be wise ones and in line with the person you really are and what you want to share. Those types of choices tend to be both less expensive and more meaningful, which means they have far more value.

Good luck!

The post Some Thoughts on the Choices We Make When Decorating Our Homes appeared first on The Simple Dollar.

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Thursday, June 22, 2017

18 Clever Ways to Make Frugality a Highly Social Endeavor

It’s easiest to be frugal when you’re flying solo. When all you have to think about is yourself and your own internal demands, it’s easier to make frugal choices. Often, the desire to be social or the desire to keep up with social demands can really eat into our finances, because the financial cost of things like going out with friends and eating out with friends add up really quickly.

Because of that, many people who dabble in frugality tend to take that path of least resistance and find themselves engaging in a lot of solo activities. They spend more time at home and less time with their social circles, which works okay for a while when the excitement of trimming back your spending and getting your bills under control is still burning bright, but when that glow cools off, frugality can end up feeling pretty lonely – and, for some, lonely often feels boring, too.

Frugality winds up creating a lot of anti-social feelings and stereotypes. People who are new to frugal living – and even old hands, sometimes – can feel like antisocial weirdoes and worry about being unwelcoming.

I’m an introvert. I like having lots of solo time. However, even for me, there are times that doing the most frugal thing can end up feeling a little lonely.

It’s during those moments that I turn to a healthy handful of frugal strategies that also happen to be pretty social strategies as well. Here are eighteen social things that I really enjoy doing that also happen to be quite frugal. Don’t be afraid to pick and choose among these and suggest some of these ideas to your friends for feedback.

Strategy #1 – Go to a Meetup
Meetup.com is an invaluable tool for frugal people with varied interests who want to explore those interests and easily meet others who share those interests in the community. Effectively, Meetup is a directory of interest groups in your area – clubs or organizations that are focused on a particular shared interest among its members. You might find groups for origami or board gaming or storytelling or woodworking or anything else, depending on the area you live in.

Simply head over there and browse what’s available within, say, a 25 mile radius of your home, and then make a conscious effort to visit all of those meetups that are of interest to you. Try diving into things that you’re unfamiliar with but that you might find compelling, or even things that are just completely outside of your typical areas of interest, just to see what they’re like. At worst, you spent an interesting afternoon or evening and know more about the topic in question and perhaps met a few interesting people; at best, you found a new social group and a new hobby to boot.

Strategy #2 – Host a potluck dinner party
A potluck dinner party is simply a gathering of friends at your home where each invitee brings some sort of contribution to the meal. Perhaps they bring a side dish or a couple bottles of wine or a dessert. Each person should bring enough to contribute meaningfully to the meal, which reduces the cost for the hosts and adds a lot of variety to what’s on offer.

Not only is a potluck dinner party a super-inexpensive way for a group of friends to spend a great evening together, it can also become a rotating thing, enabling different people to take on the chore of hosting (as the host does have to handle cleanup and dishes and such).

Potluck dinner parties are the backbone of our social life. We have them fairly regularly, inviting several friends to bring themselves and food and beverages to our home for a great shared meal and a lot of laughs. It works incredibly well for families that are quite busy and can’t always find time to plan a perfect dinner party or find babysitters for a night out.

Strategy #3 – Check out your community calendar
The website of almost every city and town in America features some sort of community calendar feature which lists upcoming events of interest in the community. These calendars often include civic government things like city council meetings, but they also include things like community band concerts (which are often free), town festivals, city-wide garage sales, and other events that are either free or extremely low cost to participate in. Those events are usually well-attended and, if you’re willing to be outgoing, they can often be a place to meet interesting people in your community.

Find an event or two of interest and attend it. Be friendly and open to meeting people at the event. If you find it compelling, find out who organized that event and get involved with planning the next one. It usually won’t cost you a dime and you’ll definitely meet some new people in that process!

Strategy #4 – Host a “game night” or a “movie night” (and ask people to bring a snack or drink)
In addition to our potluck dinners (mentioned in #2, above), we also regularly host game nights and occasionally host movie nights (though our movie nights usually center around collectively roasting a bad movie rather than quietly watching a good one, as a good roasting is far more social than a quiet viewing in the dark).

We simply ask everyone to bring some sort of snack to share and, if it’s a game night, bring a game they’re interested in playing and are willing to teach. If the group gets too big, we set up a table in the living room for an additional game running in parallel to the one in the kitchen (one is usually a very open social game, while the other one is usually more complicated and strategic).

Neither of these events cost anyone much money at all – you might bring $5 or $10 worth of food or beverages in exchange for an evening of snacks and entertainment.

Strategy #5 – Organize a soccer game or a basketball game at the park
If your community has open soccer fields (as ours does), all you need for a game of soccer is a soccer ball and enough people to form two reasonable teams. That’s it. You just go out there, run around like fools, kick the ball a bunch, and have a good time. It just requires one person to have a soccer ball, and some communities will even loan them out for a tiny deposit.

Even if your community doesn’t have an open soccer field, you can still go out there, find an open space, define some goals using natural landmarks, and play soccer. It’s a great way to get some exercise, hang out with friends, and not be in a competitive league that might be above your skill level. I’m awful at soccer, but I still enjoy doing this every once in a while.

The same thing holds true if your community has open basketball courts. All you need is a ball and a willingness to play.

Strategy #6 – Make something useful with your friends, like soap or
Just invite some friends over to make something frugal together and have them bring some of the ingredients they’ll need. With soap, for example, have them bring whatever unique ingredients they might want in their soap along with maybe a snack or something and you’ll just supply some of the basics (like lye and molds).

Making something together is a great way to bond socially and if it’s centered around making something you can actually use, it’s a pretty frugal way to spend an afternoon, too. You can make things like soap or homemade dishwashing detergent tabs or bread or anything else. The goal is to just hang out together for a while and then, at the end, everyone has something worthwhile to take home. My wife sarcastically calls this strategy a “Tupperware party without making people buy stuff they don’t want.”

Strategy #7 – Organize a block party where everyone brings a food item or some beverages
A block party is simply one in which you get together with a bunch of neighbors, spread out a bunch of food, hang out together, play some music, and get to know each other a little. It can be a great way to meet people in your neighborhood, especially if you’re new or if you have a lot of new neighbors.

If you know any of your neighbors very well, stop by and talk to them about organizing such a block party together. Then distribute flyers and tell people to bring a side dish, some chairs, and their own grilling materials (and buns if needed). On the day of the event, all you have to do is get together a bunch of grills and then turn on your social side. People will come.

Strategy #8 – Organize rotating babysitting with another family
If you would like to occasionally go out but the cost of child care is prohibitive, see if you know another family with children close to the age of your own children and consider talking to them about rotating child care amongst the families. This is a great solution for two families that have several children each, because the burden can be intense and expensive for a babysitter but a family with several kids can handle an afternoon or an evening with a few more quite easily.

What this does is it makes date night for a married couple much less expensive than before and makes it possible for them to attend parties without the children in tow on occasion without having to spring for the additional cost of a babysitter. The only real cost will be one meal for a few extra kids on a future night, but your own children are being provided a meal as part of the equation, so it balances out.

Strategy #9 – Invite good friends to do normal life activities and errands with you, such as jogging or buying a planned item
If you find that many of your activities that you’re filling your life with aren’t inherently social, make them social anyway. Invite a friend to go jogging with you. Invite a friend to binge watch a show on Netflix. Invite a couple of pals to help you go buy a mattress.

Those are normal, everyday activities, but with friends, they become much more fun than they would be if you just tackled them alone. I’ve invited friends over to just play video games. I’ve invited a friend over to help me sort through a mountain of books (and he brought along some books to swap). I’ve gone on ordinary bicycle rides with friends. I’ve gone grocery shopping with friends. It’s just normal stuff, but if you do it with someone, it becomes inherently social.

Strategy #10 – Look into social groups at your local library
Many local libraries have a number of groups that meet within its walls. You’ll find things like book clubs (usually a bunch of them on a bunch of different topics), political discussion groups, speaker series, workshops, and lots of other surprising things. One library in our area has an open D&D group, a board gaming group, multiple crafting groups, and a group that apparently finds some place to do tai chi, although I have no idea where exactly that works in there.

Just check out the library website or stop in for a bit and ask the librarian about their programs. Put aside some time and check out all of the groups that seem interesting. They’re almost always loaded with interesting people and I’ve wound up with a few pretty good friends from events like these.

Strategy #11 – Go on a picnic and take a small hike at a nearby state park with friends
If you’re looking for a special excursion with your friends, just plan on spending part of a day at a state park with them. Pack up a picnic lunch, then find a spot to meet up. Go on a few trails of a difficulty that won’t overwhelm anyone, stop for lunch, and then just explore the offerings of the park.

It’s a great way to get outside with friends and explore lots of new environments without spending much money at all. A day at a state park with trail walking and a picnic is actually one of the things Sarah and I enjoy doing the most with friends, so we often suggest the idea.

Strategy #12 – Join a civic group like the Lions Club
Many communities have civic organizations that are open to all interested community members or a broad cross-section of community members. These organizations often help organize community events and step up when charitable efforts are needed for the town, and many of them build a strong community within themselves of like-minded people who take pride in having a great town to live in.

See what civic organizations are in your town and which ones you might be able to join, then look into those organizations and choose one or two that might fit your needs. Doing so will provide an opportunity to get to know many people in your town, build some relationships, and spend some of your time and energy making your community better for everyone.

Strategy #13 – Get involved with a volunteer project, like your local food pantry or Habitat for Humanity
If you’re more interested in project-based volunteer efforts, look into volunteer organizations in your area such as Habitat for Humanity or the local food pantry. Such opportunities are still social in nature, but they tend to have much more of a service orientation to them.

I will personally vouch for working for the local food pantry or food bank. I have been a regular volunteer at such organizations in the past and continue to do so when family scheduling allows it. Helping with local food distribution to the poor has been one of the most profound experiences of my life and it’s helped me to build several valuable friendships. I can’t recommend it enough.

Strategy #14 – Take a frisbee and some friends to the park
This follows along with the idea of taking a soccer ball to the park or a basketball to a playground, but a frisbee has a different set of advantages. First of all, tossing a frisbee around is about as low impact as you can get in terms of exercise. However, you can escalate things into all kinds of games, with games like ultimate turning into a pretty serious workout.

Another advantage of a frisbee is that it works almost anywhere and you can easily toss one in your backpack or keep one in the trunk of your car. We keep a frisbee in both of our vehicles just in case the opportunity comes up.

Strategy #15 – If you’re adept at a musical instrument, invite musical friends to jam or even to form a band
If you own a musical instrument, enjoy playing it, and are even remotely adept at playing it, invite friends over to jam with you. The simple process of playing music in a group is one that is almost always enjoyable for everyone involved, as it often turns into a collective that’s greater than the sum of its parts.

If it doesn’t go all that well, then you simply had a few hours to hang out with friends and jam a little. If it does go well, you can take it further than that and form a band, working on pieces of music and even performing shows. I have a friend, for example, who taught himself how to play the banjo and eventually turned that into a standing gig with a band that basically consists of some old friends playing a guitar, a banjo, and some woodwinds.

Strategy #16 – Attend a religious service and join in social events after the service or during the week
If you’re already religious or are curious about religion, attend a religious service of a faith or denomination that is interesting to you. Pay attention, then talk to the people afterwards and find out more about the organization. Religious organizations often provide a wonderful community to be a part of and typically have lots of social events throughout the week.

This tends to be a good idea if you are in spiritual agreement with most of the tenets of the organization, but if their beliefs are far away from your beliefs, this is a poor idea as you’ll often end up in conflict with the rest of the group. If you’re unsure where you stand, explore your own ideas a little before diving into a religious group.

Strategy #17 – Have a “home improvement project” party and encourage friends to host them, too
This is a frugal activity that was very popular in the area where I grew up. Whenever people would be facing a major home improvement project, like replacing a roof or moving to a new home, they’d often host a party and divide the work amongst everyone who came. This would often turn home improvement tasks from something that would take weeks into something that would take an afternoon for the cost of a group meal.

These parties were very social and they were hosted by people on an at-need basis. If someone was moving, they’d host a party at their new home with friends and family helping them to bring boxes and furniture to the new place. If someone was refinishing a basement, they’d have a big party for everyone after a day of hanging drywall and painting.

Strategy #18 – Organize and have a large meal prep session with friends
This final strategy is another clever one if you have busy friends and can line up a weekend afternoon together. It’ll provide a great social gathering and also save everyone involved a ton of money and time.

Essentially, what you do is plan out a make-ahead meal of some kind – like, say, a pan of lasagna – and then plan everything out so that everyone will get to take home four pans to stick in the freezer. If you have seven people show up, that means 28 pans. How many noodles will that take? How much sauce? How many reusable containers?

Divide up the shopping for all of that stuff among all attendees, averaging out the cost to the best of your ability. Have one person bring several jars of pasta sauce. Have another person bring a ton of lasagna noodles. Let someone else bring the cheese. Have two guests split the purchase of 28 reusable pans for the lasagna.

Then, just get together and assemble all 28 pans as a group. The whole thing is a giant social endeavor, allowing you to all spend some time together and enjoy each other’s company. Perhaps you can even make an extra pan and eat it together when the meals are completed.

Final Thoughts

Being frugal does not have to mean being anti-social. It just means being a little more selective in terms of the social things that you spend your time doing. There are still infinite options for spending time with friends, even if you put a tight cap on your spending, and there’s no reason you can’t mix and match the ideas above with some of the activities you used to do.

You might be surprised to find that some of your friends really embrace the lower-cost options, too. Many people secretly balk at the idea of spending a lot going out every night but are afraid to buck their social group’s norms. You might just find that by suggesting some lower cost things, you’re pleasing many more people besides yourself.

Not only that, making intentionally frugal choices can sometimes help you build new friendships. When you take the initiative to check out a social organization or go to a meetup, you’re likely going to meet new people who share at least some interests and values with you, which is a wonderful way to expand your social circle.

Good luck!

The post 18 Clever Ways to Make Frugality a Highly Social Endeavor appeared first on The Simple Dollar.

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Should You Use Plastiq to Pay Your Mortgage and Other Bills With a Credit Card?

If you love credit card rewards and spend your free time pursuing points and miles, you already know the secret to outsized rewards: The more bills you can charge to your rewards credit card (and pay off right away), the more points and miles you’ll earn over time.

Personally, I pay every possible bill I can with credit – expenses like car insurance, health insurance premiums, groceries, gas, and internet service. Over time, even small purchases can add up to huge rewards that cover some pretty cool travel experiences around the globe.

But, there are certain bills that are tough to pay with a credit card. Your mortgage and rent can be downright impossible, for example. Some companies, like utilities, even charge fees of 3% or more when you swipe – fees that usually cost more than any rewards you’d earn.

So, what do you do when you want to pay with credit and can’t? A fairly new service called Plastiq.com has the answer.

What Is Plastiq?

Plastiq.com is a service that makes it possible to pay bills like rent, tuition, or mortgage payments — and even invoices — by credit card when you ordinarily couldn’t.

Once you open a free account, just add a credit card, enter your mortgage or bill details, schedule a payment, and you’re done. Plastiq will send a check to your mortgage company or bill servicer, and charge the expense to your credit card. And voila, your rewards are on their way. You can set up automatic payments that take place on a certain date every month for a specific amount, or you can make every credit payment manually through the service.

Alas, Plastiq doesn’t offer this service out of the kindness of their hearts. They also charge a fee, typically equal to 2.5% of each bill you pay. So, your $1,000 mortgage payment? You can pay it through Plastiq, and earn credit card rewards for it — but it will set you back $25.

Is that worth it? Not usually- but in some cases, you might decide it is.

When Does It Make Sense to Pay Bills With Plastiq?

Paying a 2.5% surcharge for the privilege of paying certain bills with a credit card is rarely a stellar deal. Yet, there are notable exceptions and times when this strategy can make sense.

In my humble opinion, there are three instances where using Plastiq to pay bills with your credit card can be a boon to any rewards strategy. Those instances are:

#1: When the rewards you earn are more valuable than the fee.

If you’re paying a 2.5% fee to use credit, but earning more than that amount in rewards, then using Plastiq can make sense.

Imagine you have the Discover it® Miles, for example. With this card, you earn a flat 1.5% back on all purchases. However, Discover promises to double your rewards after the first year, bringing your net rewards to 3% for the first 12 months.

If you paid a 2.5% fee to pay a hefty mortgage or other bill, but managed to net 3%, you’d end up ahead — provided you had a good use for those rewards.

#2: When you need to hit a minimum spending requirement to earn a huge signup bonus.

Many of the top travel and rewards credit cards offer huge signup bonuses to those who can meet minimum spending requirements. Take the Chase Sapphire Preferred®, for example. This card doles out 50,000 points worth $625 in travel after you use your card for $4,000 in purchases within the first three months.

While some people can easily spend $4,000 in three months paying regular bills, others with low expenses might struggle to reach that threshold without putting a big expense like rent or mortgage payments on the card. In those cases, it can “pay” to cough up a 2.5% fee if it helps you earn a huge signup bonus.

Even if you paid all $4,000 in bills through Plastiq to earn the signup bonus, you’d fork over $100 in fees to earn $625 in travel. Not bad at all.

#3: When you’re trying to reach a spending limit to earn status (maybe).

Many hotel loyalty programs offer status perks for customers who carry their co-branded hotel cards and meet certain spending requirements. With the Starwood Preferred Guest® Credit Card from American Express, for example, you can earn Gold status if you use your card for $30,000 in qualified purchases within a calendar year. You can also status match to Marriott and Ritz Carlton to score Gold status with all three chains.

I’m not saying you should pay $30,000 in bills through Plastiq.com to earn Gold status with a hotel chain; that would cost $750 in fees! But it could make sense if you’re getting close to the threshold but need some additional spending to put you over the limit.

The Ritz Carlton card also offers Gold status for free the first year, then each thereafter when you spend $10,000 on the card. If you stay at Marriott or Ritz properties often enough, paying $250 in fees (2.5% of $10,000) to earn Gold status could be worth it. Why? Because Gold status can lead to pricey room upgrades and free breakfast that can be worth significantly more than $250 if you travel often.

The Bottom Line

Outside of these three examples, though, it rarely makes sense to pay bills with Plastiq.

Keep in mind, however, that special promotions can change the numbers quite a bit. Occasionally, Plastiq offers discounts for multiple payments, or a smaller percentage fee for a limited time. You can also sign up for a referral code to earn fee-free payments when you refer your friends.

If your goal is earning more rewards over time, a service like Plastiq.com can help. But, it can also hurt. If you don’t do the math, you could wind up forking over fees that exceed the rewards you earn.

Like all other important financial decisions, you have to take a look at your own situation and run the numbers to see what’s best for you. Paying bills with a credit card can make sense under the right conditions, but it can also cost you more than you’ll get in return.

Holly Johnson is an award-winning personal finance writer and the author of Zero Down Your Debt. Johnson shares her obsession with frugality, budgeting, and travel at ClubThrifty.com.

Related Articles:

Have you ever heard of Plastiq.com? Would you pay bills this way or not?

The post Should You Use Plastiq to Pay Your Mortgage and Other Bills With a Credit Card? appeared first on The Simple Dollar.

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Wednesday, June 21, 2017

10 Smart Ways to Use Leftover Pasta (Smart Staple Strategies #3)

For the next few weeks, we’re going to talk about some smart strategies for using leftover staple foods – things like rice, beans, pasta, and so on. Here’s what you do when you cook a bit too much and don’t know what to do with the rest!

It’s tricky to cook the right amount of pasta for a meal. Because you want to make sure that you have enough pasta, it’s very, very easy to cook too much pasta, often leaving you with excess pasta.

Sometimes, we add sauce to all of the pasta, locking it into being used as a straightforward leftover meal. We put the sauced pasta in a container and pop it in the fridge to be used later on.

At other times, though, we make a much wiser choice. We don’t sauce the pasta at all and leave it plain, often keeping it from sticking together by mixing in just a tiny bit of olive oil. On those occasions, we find ourselves with some cooked but unused pasta in a container in the fridge.

On those occasions, we have a leftover food item with a lot of possibilities.

Here are ten ways to use a container of leftover pasta. Most of these ideas are frameworks rather than strict recipes – play around with the ingredient proportions yourself to see what delicious creations you might make!

Strategy #1: Make a casserole.

Perhaps my favorite use of leftover pasta is to turn it into a casserole by layering the pasta in a casserole dish with sauce and leftover vegetables and seasonings and cheese, then baking the whole thing in the oven until it transforms into a delicious casserole that can easily be served in slices.

Just cover the insides of a casserole dish with a bit of olive oil, add a bit of pasta sauce or tomato sauce to the bottom of the pan, then add perhaps a third of your pasta on top of it, then add some vegetables, then add some cheese. Repeat this three times, then top it with a layer of your remaining cheese. Cover and bake at 350 F for thirty minutes, then remove the foil on top and put it under the broiler for a minute or two to gently brown the cheese on top.

This is such an amazing dish and it’s so flexible! It works with almost any kind of sauce you have available, whether it’s just a mix of tomato sauce and diced tomatoes or some kind of crazy vodka sauce or anything else. It works with practically any kind of pasta and almost any kind of cheese as well.

Strategy #2: Transform the pasta into a frittata.

I sometimes eat leftover pasta for breakfast. There, I said it.

All I do is essentially make scrambled eggs with some of the leftover pasta broken up in it, along with a bunch of leftover vegetables mixed in. Just take a dozen or so eggs, scramble them, toss in your vegetables and a few seasonings that seem tasty, then melt a tablespoon or so of butter in a skillet over medium heat and then pour this mix over the top and cook it over medium heat. Once the bottom layer is solidly cooked, I usually lift it up to get some of the uncooked egg underneath it – sometimes, if I’m feeling adept and the bottom layer is well done, I’ll flip the whole thing.

Once all of the egg is cooked, add some shredded cheese on top and serve it. I usually cut it up into wedges and serve it with some fruit on the side. It makes for a really filling breakfast and can work for other meals, too. The pasta really adds some weight to the meal, making something fairly light into something fairly filling.

Strategy #3: Fry them for some delicious stir-fried noodles.

Almost all pasta can be used to make a stir fry meal. All you really need to do is add some oil to a pan or skillet and turn up the heat, cook some vegetables that you like in that oil for a minute or two, then add in the noodles. Keep tossing the whole mix together until everything is nice and hot. Add a sauce of your choosing – I often use straight soy sauce, or I might mix some soy sauce with peanut butter – and enjoy!

This is a great way to use leftover vegetables, too, as almost any vegetable that might work well in a stir fry – onions, peppers, carrots, and so on – works well here. It just gives you an excuse to fry up some extra vegetables and pasta, add a bit of sauce at the end, and enjoy it.

Strategy #4: Make them portable by making ‘pasta muffins.’

Pasta muffins? Basically, I just mix together “good stuff” with some chopped-up pasta, a few scrambled eggs (which serve as a binder), and some cheese. What do I mean by “good stuff”? Well, I mean almost anything that tastes good. I like using mushrooms myself – leftover mushrooms in this is amazing. You can use leftover vegetables, cooked ground beef, cooked ground sausage, cooked chicken – almost anything works.

Just take your leftover pasta, mix in about half as much “other stuff” as the total amount of pasta that you have, and then for every three cups of mix that you have at this point, add a beaten egg. Then preheat the oven to 350 F, spray down a muffin tin with nonstick spray, and add some of the mix to each container, pressing it down in there so that it’s tightly packed in each muffin slot. Add a bit of cheese on top and bake for about eight minutes or so, until the egg firms up well and holds everything together.

These “pasta muffins” make for a great savory snack. A couple of them can even work as a light “on the go” meal when you’re in a rush.

Strategy #5: Turn them into a brightly-flavored pasta salad.

Whenever I see leftover pasta, I find myself always thinking of a pasta salad in which I make some kind of flavorful dressing and mix on some additional tasty items such as a bit of cheese.

My favorite thing to do is to simply take whatever vegetables we have in abundance in the garden, chop them up into small pieces, then add some Italian dressing and the vegetables to some leftover pasta and mix, adding just a bit of cheese for extra kick.

This is a great way to use up excess vegetables and excess pasta very easily, which is perfect for a late summer afternoon when you can get fresh vegetables in abundance at the farmers market or out of your own garden.

Strategy #6: Make some soup.

Chicken noodle soup works wonderfully with most kinds of leftover pasta. So does a vegetable noodle soup. All you really need is some broth, some leftover vegetables and/or cooked chicken, and your remaining pasta. Just add everything together, season to taste, and heat the whole thing up.

This is our go-to solution for leftover pasta in the winter. Submerged in a rich vegetable or chicken broth, pasta transforms into the backbone of a delicious heart-warming soup.

Strategy #7: Make some amazing mac-and-cheese.

I love my simple three-ingredient mac and cheese recipe. I just take leftover pasta, add it to a sauce pan, add a tiny bit of water and a full can of evaporated milk, then heat it over medium heat until the evaporated milk is just on the verge of boiling. At that point, I just add a couple of cups of shredded cheese that melts well – cheddar is fine, as is gruyere or fontina or jack cheese – and mix the whole thing together. Boom – you have a creamy mac and cheese!

My children absolutely flip over this, and it appeals to me as well because I can use a variety of cheeses to change it up or add other leftover items if they’re on hand, such as chopped broccoli or chopped cooked chicken breast.

Strategy #8: Turn the pasta and leftover rice into a super-flexible side dish.

I’m sure you’re familiar with Rice-A-Roni. It’s basically just instant rice and tiny bits of pasta with flavoring, right? Easy enough. Well, it’s super-easy if you happen to have some leftover pasta, too.

All you need to do is chop up your leftover pasta into small pieces, then add it to a saucepan along with some leftover rice and a bit of oil. Heat this until everything is hot, then add whatever flavorings you might like, from Italian seasoning and a bit of cheese to a taco seasoning packet or some steak seasoning, and add a bit of water or milk, just enough to coat everything with the flavoring.

This is a super-cheap and tasty side dish that’s so flexible because of the seasonings. You can serve it as a side dish with almost any entree depending on how you season it.

Strategy #9: Transform the pasta into crunchy flavorful fritters.

Here, you just take leftover pasta and fry it thoroughly in disc shapes in a bit of oil to make a crispy snack, and it can be easily flavored in a variety of ways.

For every cup of leftover pasta you have, add a beaten egg and a quarter of a cup of breadcrumbs. Mix all of this together with whatever seasonings you like and a bit of cheese (perhaps a quarter of a cup of shredded cheese for every two cups of pasta you’re using). Heat up some oil in a skillet, then form this mix into small firm discs and put it in the skillet. Flip the discs regularly until they’re nice and brown and crispy but not burnt, then serve them.

Strategy #10: Make a ‘noodle cup’ in a spare jar.

This is a trick I learned from an old coworker. What she would do is bring a jar to work that featured layers of pasta and whatever ingredients she liked around the house and she’d often eat it as a cold lunch straight from the fridge.

She might simply have some leftover chopped chicken as layers between the pasta, or maybe some kimchi or some sauerkraut, or maybe some cucumbers with a bit of Italian dressing mixed with them. It was basically a clever and very convenient way to use leftovers, as it just required a jar to take them to work and it was easy to eat it out of the fridge.

I started doing this myself and I found that I loved how flavors would meld together in the jar. As with many of these recipes, the ingredients you add drastically change the flavor, so just add things you like. I’m a huge fan of kimchi, for example, so layering the pasta with the kimchi made for a flavorful and hearty salad.

Next time, we’ll look at some awesome strategies for using extra potatoes!

Related Articles: 

The post 10 Smart Ways to Use Leftover Pasta (Smart Staple Strategies #3) appeared first on The Simple Dollar.

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