A reporter from The Washington Post contacted me earlier today, writing: “I’m looking for folks whose salaries or wages have not been growing much in recent years, and how they have adjusted over the years. Have they had to make lifestyle adjustments? If so, what have they cut back on? Has it affected long term savings goals?” If you can help and would be willing to share your story, contact Annys Shin: [shina AT washpost.com]
Meanwhile, are a few of my favorite personal finance stories from around the web:
First up, Flexo at Consumerism Commentary has eight tips for living through a recession. He hits on a few of my favorite suggestions: go back to school, turn your hobby into a business, and sell your extra stuff. I think these are three things that folks often overlook when wrestling with their finances.
Have I mentioned GovGab before? This is the official U.S. government blog (no joke!), and it provides a lot of information about government resources. I highly recommend this site. GovGab recently provided help for the unemployed. If you (or someone you know) need information about unemployment, this is a great place to start.
Over at Behavior Gap, Carl Richards has some thoughts about the simplicity premium. He argues that people are rightfully willing to pay a little bit more to simplify their lives, especially their financial lives. This “simplicity premium” often costs less than being confused by complexity.
I often say that “money is more about mind than it is about math”. By this I mean that our financial decisions are more emotional than they are logical. A recent article from New Scientist backs this up. Mark Buchanan explains why money messes with your mind. He writes: “Money — supposedly a dispassionate tool of exchange — stirs up big emotions and mental strife. It’s time economists’ models took this into account.” Great stuff, and possibly worth a full blog post in the future.
Finally, Chris at The Art of Non-Conformity published an outstanding article this morning called, “Welcome to the Real World“. “The real world is not reality,” he writes. “It is not defined by facts. It is determined by the collective perception of unremarkably average people. They are the people in The Matrix who have taken the blue pill.” Great stuff.
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Thank you for the links above. I found the article about ‘money and the mind’ to be especially informative! I think one good test (out of many) for individuals to determine how much control they have on their emotions related to their finances is to track their spending when they receive any sort of bonus or unexpected windfall. Too often, people spend this additional money in a matter of days or weeks instead of months and without regard to any plan, debt reduction, or notion of saving.
Again, thank you for the link. I agree it is a great topic and would look forward to a full blog post in the future.
Jake | Revive Your Life
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this is a great time to go back to school, but this idea is occurring to a lot of people now. early on in the downturn, it was fairly easy to get financial assistance. now, demand for grants is increasing, but budgets aren’t following.
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I would LOVE to throw that real world article in my dad’s face (which I guess means I’d have to print it out). He spent two decades lecturing me all about “the real world”, and trust me when I say that it’s nothing like his perception!
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Regarding the “Real World” emo-piece:
I found it very narrow-minded and arrogant. I doubt it’s even occurred to him that many of the people lecturing on the “Real World” may have had similarly idealistic notions about the world when they were young too, but through time, gained a better understanding of the economics and social interactions that govern our lives. He is frighteningly quick to dismiss the possibility that there is any wisdom at all to be gleaned from elders proffering explanations of how certain things world in the “Real World.”
I’d be very interested to see if his tune changes in 10 years. Of course, by then, some other naive, leftist academic will have picked up the “your old rules don’t apply to me” torch, and the cycle will continue.
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Yup, I agree with Kevin, which is somewhat surprising given that I alternate back and forth between the “real world” and the “travel abroad and party every night” camps every couple of years. The self-righteousness and hubris coming out of the post was disgusting, as it is anytime one narrow group of people believes they’ve found THE right way to live life.
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Those are great links! The New Scientist article is a good read…
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I don’t really understand why you linked to the “real world” article. It seems to glorify a ‘live for the moment’ philosophy which IMO runs counter to a GRS approach.
And just as the author complains about people making fun of those they consider idealistic, he does the same in return. Seems smug to me.
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Regarding the “real World” post. When I was reading it all I could think about was the ant vs. grasshopper mention from a few days ago. It’s easy for the Grasshopper to be a non-conformist in spring. I would assume it’s easy to not plan for the future, to quit jobs at a whim, and to buy what you want when you want if you don’t have to answer for it. Problem is, when people realize they have given away their (and the people around them) tomorrows it usually too late to change. Thank you but I will happily live here in the “real world” and continue to chart a course, plan for the future, and realize my goals for me and my family.
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OK. I have to speak up. I read the Eight Tips for Living Through a Recession, and even visited the link for extensive frugality tips. I was right. I could have WRITTEN that list.
I’ve been living this way for YEARS. Cash-only. No credit cards. Considering ALL of my odd skills as job possibilities while seeking a new job, ANY job, because I’ve been unemployed for a few years now–long story, but there has no job and it’s been “all savings all the time” during the hunt.
There is not one thing on there I am not already doing.
And the eighth tip, “sell your extra stuff”?
Sure. But it only works when people BUY the stuff you’re selling. Worthless tip, IMHO, since the ENTIRE PROBLEM WITH THE ECONOMY is that people have stopped spending altogether and killed the flow cycle!!!
People need to wake up and realize, it is NOT about conserving money, withholding money, and prohibiting oneself from spending it–it is about releasing MORE money back INTO the economy so that we have more to spread around!!!!! Be mindful, yes, but know that frugality stemming from scarcity leads to stinginess and that leads to constipating the money cycle–and that leads to where our country is today.
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Count me in with Kevin, Davidson and Omer; I found the post to be extremely smug and self-satisfied; the author’s tone implied that HE had found the way, the truth, and the light, and those of us whose experience may differ are just wrong, wrong, wrong!
I think The Real World is, in fact, different for everyone. J.D., your friend spent his life traveling the world; had he waited until retirement, he would never have traveled at all, because his life ended suddenly. My mother waited patiently through her marriage for the time when my father would retire, and they would finally have time together. He died before he reached sixty, and they never had that time. On the other hand, if I took the next few paychecks and went traveling, I’d be living in a shipping container when I got back. I’ve spent my life applying the pertinent parts of the Eight Tips, not because I’m frugal, but because I’m poor, and it’s the only way to make ends meet. It is, in fact, my version of The Real World, and it doesn’t seem to match up with Chris’s version. And that’s okay; I’m sticking with “The Real World is different for everyone.”
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I’ve gotta speak up in defense of the “Real World” post.
I loosely follow that blog, and I can’t recall a time when Chris has advised being irresponsible. He has advised considering your priorities and going after what you REALLY want.
Would you trade a $30,000 SUV to travel the world/start a band/write a book instead? Would you be willing to find alternate income streams to keep a roof over your head while you’re at it?
Furthermore, in that post he isn’t telling people to disregard reality. He’s not telling people to disregard hard-won widsom. He is telling people to disregard naysayers who are really just raining on your parade.
Seth Godin (who has probably been told once or twice his ideas wouldn’t work in the real world) says “Shun the unbelievers.” Chris’s post says the same thing in a different way.
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Kevin,
I’ve learned the hard way that just because someone has seen more moons than you doesn’t automatically give them enlightenment. Their advice can suck as much as the next person. The point of the piece, that “reality” is largely shaped by individual perception, explains why so many people succeed at remaining clueless as they age.
In a similar vein, anyone who demands respect based on age is circumspect. Respect is earned.
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Thanks for the articles.
I wanted to add something to the help for the unemployed article as well – this one had lots of good information, but left out the Self Employment Assistance Program. I’ve recently been accepted into it and it basically allows you to continue receiving the unemployment benefits you qualify for while starting your own business. I’ve written more about it on Redefining Unemployment.
As for the real world – I basically agree with the author as that’s how I’ve been living all along. But I don’t like the dichotomy Chris sets up about the “real” world and the “living” world. Some people like the way it works in the real world – and that’s fine for them. Some of us make other choices, and that’s fine for us. Rather than accusing someone of being a “sleepwalker” I think it’s better to make our own nonconformist choices, thus subtly changing the world we ALL live in. Then, we can show by example that it’s possible to have a good life without “taking the blue pill.”
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