Your friends and family influence you. They affect the way you view life. If your friends are frugal, it’s easier to be frugal yourself. But if they’re wrapped up in consumerism and materialism, and can be difficult to resist the urge to join them. It’s only natural to want to fit in.

Rob wrote yesterday to ask how to handle a situation where he wants to lead a simple life, but those around him aren’t supportive. How can he cope with peer pressure? Here’s his story:

Since we try to live frugally, we don’t have a television or video games or any other electronic toys in our house. We try to spend time as a family, talk to each other, read books, try to help my wife in cooking etc.

My colleagues at work tell me that I live a miserable life, and I don’t give my family “materialistic life pleasures”. Those sort of words hurt me a lot. We don’t have a TV at our house and my colleague makes fun of this thing all the time.

How should I respond to people like this? Should I even pay attention to them? I don’t want to spoil my relationships at work. I’ll bet a lot of your readers experience the same thing. What are your thoughts?

It can be tough when you’re trying to save, trying to focus on the simple things, and everyone else around you seems to value Stuff. But materialism doesn’t lead to happiness. Though having money might increase your happiness, wanting money (and things it can buy) almost certainly will not. “Indeed, not only does materialism not bring happiness,” writes Sonja Lyubormirsky in The How of Happiness, “but it’s been shown to be strong predictor of unhappiness.”

Rob needs to ask himself some questions: “Am I happy? Is my family happy?” If he can answer yes to both of these, then what does he care what other people think? If he continues to struggle, he should remind himself of a few ways to cope with peer pressure:

• Trust your instincts. If you’re sure of your choices and the reasoning behind them, say so. When you get pressure, explain that you’re happy just the way you are. Be confident. Be proud to be a non-conformist.
• Laugh it off. When your friends and family get on your case, make a joke and move on. Don’t let their opinions rattle you.
• Find other friends. This isn’t always possible (or desirable). Rob may be stuck with his co-workers eight hours a day. But if your friends are pressuring you into a lifestyle you don’t want, hang out with other friends. True friends support each other; they don’t tear each other down.

To live happily as a non-conformist in a world filled with peer pressure, you have to learn to ignore everybody. Do what you believe is right, and to hell with what other people think.

To me, Rob’s life doesn’t sound miserable. It sounds idyllic. It’s the sort of thing Kris and I aspire to: spending time together, talking and reading. I’m proud of what he’s doing.

Do you have financial trolls in your life? How do you handle them? How do you cope with peer pressure?

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This post is from GRS staff writer Adam Baker. Baker, along with his wife and 20-month old daughter, will be spending the next couple of months exploring Thailand as they continue their recent backpacking journey.

Since the start of the economic slump started in 2008, the U.S. government has issued several incentive programs in an attempt to stimulate some positive movement in the economy.

First, came the popular $7500 tax credit for first time home buyers, which was to be paid back in $500 increments starting with the 2010 tax year. Next, they extended the homebuyer tax credit further into 2009, increasing the limit to $8000 and removing the burden of having to pay it back over time.

This past summer brought the controversial Cash for Clunkers program, which then spawned “Cash for Appliances.“ Most recently, the first-time home buyer tax credit has been extended, yet again, into 2010, and expanded to include some who hadn’t previously qualified since they weren’t officially first time homebuyers.

These incentive programs have drawn everything from wild praise to heated protests.

Did Cash for Clunkers bring success or regret?
Recently, the first few months of data has begun to come in from the now-closed Cash for Clunkers program.  The homepage of the official Department of Transportation website for the program, CARS.gov, now reads:

The enormously successful CARS program helped consumers who turned in gas guzzlers buy nearly 700,000 more fuel efficient vehicles in fewer than 30 days. By late September the U.S. Department of Transportation paid all eligible and complete dealer transactions. “There can be no doubt that this program drummed up more business, for more people, in more places at a time when our economy needed help the most,” said Transportation Secretary Ray LaHood.

But, not everyone is buying into the “enormously successful” label. A September article published by AOL Autos brings up some interesting facts about the CARS program:

• An August survey concludes that 17% of Cash for Clunker participates indicate they feel buyer’s remorse over their purchases. This is nearly double the traditional rate of 6-8%.
• While the average MPG of the vehicles in the program rose from 16.3 mpg to 24.8 mpg (a clear success), it’s estimated that individuals will be driving even more due to possessing a newer car. This could actually result in more fuel consumption overall.
• The program takes from over 300+ million taxpayers and rewards only a small group of 700,000.

And AOL Autos isn’t alone in the criticism of the program.  Just a few weeks ago, Edmunds.com issued a press release stating that taxpayers actually ended up paying $24,000 per vehicle sold through the program.

If Edmunds’ reasoning seems a little too simplistic (I’ll admit it does for me), there’s a more-detailed study by University of Delaware, which concludes that the cost of the program exceeded the benefits by approximately $2000 per vehicle.

Studies, press releases, and government websites aside, I’m worried that these programs encourage people to buy larger ticket items during a time that may be very hazardous to their individual financial health.

The last thing most people need to be doing in a down economy is adding thousands of dollars in new consumer debt. And in the CARS example, the majority of this debt will be on a consistently depreciating asset!

The program is best suited for a financially responsible individual, who was already in the market for an upgraded automobile purchase. But it’s obvious that the majority of the transactions didn’t involve this type of situation. For that reason alone, I have a hard time considering the program a success.

If you think impulsively buying a car is a mistake…try a house!
I have my doubts about the effectiveness of the first-time homebuyer credit, as well.

Over the last three years, I participated in the real estate markets as an agent, property management, and investor. Unfortunately, most of my participation centered around the foreclosure and short-sale markets. I saw hundreds (if not thousands) of individual cases as the housing market went sour. Behind nearly every one of these foreclosures and short sales was a rushed and impulsive purchase several years before. There were only a couple exceptions.

Once again, this tax credit is perfect for those financially responsible individuals and families who are already in the market for a conservative home purchase. I just can’t envision that this is the case for the majority of the claimed credits.

Last year, many of my friends in their 20s and 30s scrambled to take advantage of the original $7,500 credit/loan. A few rearranged their plans or bought a little early to ensure they capitalized on the incentive. Months later, they watched as it was extended to $8,000 and changed to not have to be repaid over 15 years. The same people who were considered savvy for rushing to catch this opportunity, now had wished they had delayed it another six months.

That’s just the point. No one knows what our government or administration is going to do in the future. As a whole, we seem to be letting these programs be a leading factor in our decision instead of just a bonus. I don’t know many people who, looking back five years after a home purchase, would say to themselves, “That would have been a great purchase had we only gotten $8,000 up front.”

$8,000 is a lot of money — I’d love to have an extra eight grand right now — but a home purchase is one of the largest financial commitments you’ll ever make. Rushing into such a huge commitment can end up costing you exponentially more.

It’s about more than just the numbers…
Major financial purchases, including automobiles and houses, are about more than just the numbers.

Of course, we want to take all numerical benefits and costs into consideration. We shouldn’t ignore access to these government incentive programs, but letting them be the leading factor in our decision making process would be a huge mistake.

In your financial life, make sure you are the one calling the shots, not Uncle Sam. And if the timing is right for you…don’t leave any money on the table.  Milk him for everything he’s got!

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Work on Your Money: The Missing Manual continues apace. I’ve finished the first seven chapters (happiness, goals, budgets, debt, frugality, income, and banking) and have just begun on chapter eight, which is about credit.

As part of this chapter, I’d love to profile a GRS reader who gets by on minimal credit. Specifically, I’m looking for somebody who doesn’t use credit cards at all, and who can talk about the implications. What are the advantages? What are the drawbacks? Do you know how it’s affected your credit score?

I know I could interview my friend NCN from No Credit Needed, but he’s already in the budgeting chapter! So, if your a “no credit” sort of person (as I used to be) and are willing to let me interview you, drop me a line.

Speaking of NCN, he’s the first stop in this week’s link round-up. Last month, he posted a story of how a silly little experiment helped him get out of debt. He once used online billpay to send a credit card company $5 every day for a month. By doing this, he taught himself that he really could afford saving $5 a day — and he saw the power of the “debt snowflake“.

Jonathan Fields says, “Daddies, don’t let your babies grow up to be strangers.” Getting caught up in making more money so you can provide “nice things” for your family may actually lead you away from what they need most of all: You. This is great advice for all mothers and fathers. Remember that it’s your relationships that matter most, not the soccer, the schools, and the Stuff.

Last week, when I posted the little story about my conversation with a bank teller last week, I never expected it to attract so much attention. “Is there a generation gap in saving?” I wondered aloud. Here are some responses from around the web:

• The Simple Dollar: Is saving for old people?
• Studenomics: Are twenty-somethings not saving money?
• Debt-Proof Living: Why the “younger generation” is more responsible than you think

For the record, I’m not saying there is a generation gap (and, in fact, in the comments Jim shared stats that show saving is about the same for all age groups except the elderly). I was just recounting a conversation!

Here are some more quick hits (man, I’m loaded with links today!):

• Wise Bread: What it really costs to own a home
• Realm of Prosperity: How I was able to build good credit as a college student
• The Oblivious Investor: How much does a financial advisor cost?
• BudgetPulse: The best ways to teach kids about money

One last thing before the carnival summary — I busted a gut looking at Cats4Gold:

Here’s the weekly summary of financial carnivals. These are great places to pick up new tips on saving money:

• Tom at the Canadian Finance Blog hosted Carnival of Personal Finance #230.
• Gather Little by Little shared this week’s Carnival of Money Stories.
• The Festival of Frugality #203 was held over at Domestic Cents.
• Foreigner’s Finances rounded up the Carnival of Twenty-Something Finances.
• The Skilled Investor hosted the Carnival of Financial Planning #114

Final note: The category archives have a new layout. There used to be just 5-10 posts per page (with excerpts), but I found those tedious to wade through when searching for an old article. Now each archive page has a huge list of the posts in that category. For example, here’s the list from the self-improvement category (which is one of my favorites). What do you think? (Or does anyone besides me even use the category archives?)

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To take control of your spending, you must first be aware of your spending. This mindfulness can be difficult for many people to achieve. GRS reader (and awesome artist) Tsilli pointed me to the work of Kate Bingaman-Burt, who has a unique way of being mindful of the money she spends: She draws it.

Bingaman-Burt teaches graphic design at Portland State University, but for the past eight years, she’s also been documenting her spending habits at her blog, Obsessive Consumption. But this isn’t just a spending log — it’s art! Here’s an example:

Would drawing my Burgerville milkshake make me more conscious of my spending habits? I’m not sure. But I do think that were I still in debt, drawing my credit-card statements would make me more mindful. Bingaman-Burt does that too:

I’m not suggesting that you should start drawing what you buy, but I do think that anything you can do to increase your mindfulness is great. It’s when we spend without thinking that we get into trouble.

You can see more of Bingaman-Burt’s work at Obsessive Consumption or on Flickr.

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This is a guest post from Robert Brokamp of The Motley Fool. Robert is a Certified Financial Planner and the advisor for The Motley Fool’s Rule Your Retirement service. He contributes one new article to Get Rich Slowly every two weeks. Today at 3pm Eastern, Robert will by leading a live discussion about money and relationships at BlogTalkRadio.

Howdy, folks. I’m writing you from a hotel room in Charlottesville, Virginia. All alone. My wife kicked me out of the house.

But it’s a good thing.

You see, for reasons too boring to enumerate, it’s been a topsy-turvy few months in the Brokamp household, and my “to do” pile has really piled up. It was beginning to affect stress level, and threatening my remaining hair follicles (which are already an endangered species). So my wife found a hotel for me, reserved it for two nights, and kicked me and my “to do” pile out of the house.

And it’s been great. I’ve filled every garbage pail in the room, along with a trash bag I brought along with me. I’ve consolidated my lists, organized papers into folders, prioritized my various responsibilities, and fine-tuned my task-management system — all without the interruptions of kids, household chores, or the Wii.

My weekend away was all about my job, but if you’re having trouble tackling all those nagging financial tasks, perhaps it’s time you take a “personal finance retreat.” And you don’t have to go away; you just have to stay home on a day (or two) when no one else will bother you.

One of my colleagues recently did this. Motley Fool senior editor Denise Coursey took a one-week “stay-cation” to conquer her list of tasks. On the financial side, she changed her family cell-phone plan, opened a new bank account, set up direct deposit and auto bill pay, signed up with Mint, and created a budget. Besides streamlining her money management, Denise estimates that her financial retreat will save her $1,000 to $2,000.

In July, New York Times columnist Ron Lieber wrote about his own “financial health day,” which involved getting a will, opening a higher-yielding savings account at SmartyPig, and submitting flexible-spending receipts. He figures his day off will save his family $2,000, and he plans to make it an annual tradition.

Crossing off the items on your financial to-do list might require more vim and vigor than you have at the end of the day. Plus, many tasks require getting a human being on the phone, which is not always easy at 10 p.m. So maybe you, too, can increase your net worth and decrease your stress level by taking a financial health day. Here are eight tips for what to do, and how to do it.

1. Build Your Financial Control Center
One of the biggest impediments to completing any task is not having everything you need when you need it. Somewhere in your home, assemble your financial control center — a working area that has all the files, forms, statements, and passwords you need to get the job done. According to productivity guru David Allen (author of Getting Things Done), “The workspace should function like a cockpit — all the controls easily accessible as required, allowing for maximum focus on the work at hand.” And don’t forget the important tools: Before the big day(s), get thee to an office supply store to stock up on pens, printer paper and cartridges, stamps, sticky notes, folders, envelopes, tape, legal pads, and reference materials. Eliminate the speed bumps of having to get out of your seat or run to the store to get what you need.

2. Build That Budget
If you’ve always thought you should analyze your past spending and plan your future spending (i.e., budget) but never had the time, here’s your chance. Fire up that spreadsheet, or give personal finance software like Quicken or Mint for a spin.

3. Get All That You’re Due
Do you need to submit flexible-spending receipts, insurance claims, expense reports, or (gasp!) tax returns?

4. Prevent Future Expenses
Avoid penalties by renewing soon-to-expire licenses and registrations, sending in upcoming insurance premiums, and paying parking tickets or any other expenses that will cost even more if you procrastinate.

5. Take Time to Comparison Shop
Do you know which of your local grocery stores has the best prices? Are you paying too much for your cell phone? Could you get a better deal on your gym membership? Are you getting the most perks on your credit card?

6. Prioritize Your List
Financial housekeeping often takes longer than you think it will. So spend some time the night before ordering these tasks…moving those with the biggest financial payoff to the top of your list. Also, prioritize projects that can only be accomplished during normal business hours.

7. Be Ready to Multitask
You may be spending a lot of time on hold, navigating customer-service phone trees and waiting to be recorded for quality-assurance purposes. Have another task ready to work on while you’re waiting to speak with a human being.

8. Put On Your Blinders
This day is for financial housekeeping only. Turn off the cell phone, ignore Facebook, and don’t check your email.

9. Get Away From It All
Make your financial health day a real retreat by doing it somewhere else. Go to a hotel, bed and breakfast, a friend’s vacation home — somewhere with no distractions. Bring all the paperwork you’ll need. This is especially good for higher-order tasks, such as mapping out financial and career goals.

p.s. There’s still time (but not much) to fight pediatric cancer and make fun of my mustache.

J.D.’s note: I’ve been preaching the virtues of scheduling a Money Day for three years now! I think this is an excellent way to make time to tackle those financial chores you’ve been neglecting.

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This morning, April wrote about trying to figure out how much house you need. In the comments, Tyler K. shared a photo of the house he and his wife live in. It has 450 square feet:

“Last year our joint gross income was about $170,000,” Tyler wrote, “but we still find this house plenty adequate, and it means our housing costs are proportionally half of the 30-35% of income that people generally recommend.”

I was intrigued (as were other readers), so I wrote to ask for more info. Here’s what Tyler has to say:

When we moved to Santa Cruz, we found this little tiny house one block from the beach. We loved it. We decided to take it as soon as we saw it. This house is a rental, but that’s something we’re okay with for now.

The big draws of Santa Cruz over Alameda were the beach (I surf and sail), the mountains and natural beauty (there are great parks, open spaces and roads for cycling), the weather (it’s sunny and 60 degrees out right now, which is typical for mid-November), my family, opportunities for my wife (she’s recently been participating in research on seals and sea otters). None of these things require a big house.

• I can ride my bike to go surfing, or go the other direction and be riding through the redwoods in the mountains in less than half an hour.
• We don’t have a TV room, but we don’t have a TV, so no need. We don’t have a guest room, but we don’t have guests but once or twice a month.
• We don’t have a “hobby room”, but my wife can knit on the couch, and it’s really sort of hard for me to surf, cycle, or sail indoors.

The house is small, but it’s not a compromise to live in. I love living here.

We’ll probably have kids in the next few years, and not too long after that, we’ll probably want a two-bedroom place, but it will still be small. That may be when we decide to stop renting and buy our own place, as well.

Obviously, Tyler’s house wouldn’t work for everyone. But I think it’s great that he and his wife made a conscious decision to live someplace smaller so they could focus on the things that really matter to them. This, my friends, is one of the keys to happiness (and financial success).

On a side-note, Tyler recently completed a fascinating 30-day-project:

Most of our lives are lived on average days, not big once-in-a-lifetime days when we get married, or pay off the house, or graduate from college. Yet, many people focus quite intently on these big goals, to the exclusion of day-to-day life. This is my effort to emphasize the days that make up 99% of our lives. For 30 days, I’m recording the regular things that I do, every day.

He spent a month photographing the little things that making everyday life worth living, from birds to biking to bugs. This being in the present moment is another of the things that can lead to happiness.

Thanks, Tyler, for sharing your story with GRS readers!

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This post is from GRS staff writer April Dykman.

For more than a decade, Jay Shafer of Tumbleweed Tiny House Company has lived in an 89 square-foot home.

His decision to live in a tiny house came from concerns about the effects a larger house would have on the environment, and his desire to not maintain a lot of unused or unusable space.

Obviously Jay’s home is at the extreme low end of how small one can go with living space, but it meets his needs and allows him to live the simple lifestyle he was seeking. While it may seem impossibly small to the majority of people, 89 square feet is Jay’s right-sized home.

Contrast this with the average American home, which in 2004, was 2349 square feet, up from 1695 square feet in 1974. In 30 years, kitchen sizes doubled, ground-floor ceilings grew by more than a foot, and bedrooms increased by 54 square feet. In 2004, the average family size was 2.6 people. Thirty years ago, it was 3.1 people. Our homes have been getting larger while our families are getting smaller.

But earlier this year USA TODAY reported a change in that trend:

New homes, after doubling in size since 1960, are shrinking. Last year, for the first time in at least 10 years, the average square footage of single-family homes under construction fell dramatically, from 2,629 in the second quarter to 2,343 in the fourth quarter, Census data show.

The average size of a new home is approximately 15 percent smaller than it was just a year ago. Architects and designers believe this trend toward smaller homes was caused by the economic meltdown — but they expect it to be a lasting change.

Too big, too small
I’ve mentioned that my husband and I will be building a home soon, and we’ve gone back and forth with our architect on several sketches, trying to find our right-sized home. Most of the designs have been appealing, but some have been bigger than we need, and others smaller.

Buying or building too much home has a lot of drawbacks, including:

• Environmental effects
• Higher mortgage payment means more energy goes into paying for housing
• Higher taxes and insurance
• Requires more time and money to maintain and clean
• Higher utility bills
• More rooms to furnish

Buying or building too small is economical, but can cost in other ways. If your house is too small, you might face some of the following challenges:

• No room to expand if you have kids.
• Lack of storage space, even for basic household items.
• Not enough room to entertain friends and family. (If you enjoy entertaining, that is!)
• Lack of space for an office (if you work from home) or hobbies.
• Feeling like you’re living on top of your family members, with no personal space.

Finding a size that is just right
Too big is a waste, and too small is a headache. How does one find a Goldilocks house — sized just right? There are many considerations, such as the following:

• Lifestyle. Do you work from home and need office space? Do you travel a lot? How often do you entertain?
• Family. Do you have children? If not, do you plan to have kids (and plan to stay in the same home)? Are there elderly relatives who live with you or might need to in the future?
• Hobbies. Some hobbies require a bit of room, even if it’s just a sewing cabinet or a dedicated space for a piano.
• Future goals. Do you plan to live in the house for a long time? Do you want to travel? What are your savings goals?

Calculating the size of your Goldilocks home
Once you have an idea of what you need your house to do, you can calculate your magic number. In the article “Square Feat: Foot Steps”, architect Dan Maginn recommends starting with your current home and following these five steps:

1. Measure and record each of the rooms in your current home, thinking in terms of the functions of each room. Include cooking, dining, bedrooms, closets, bathrooms, living, storage, circulation, and mechanical/utility space.
2. Note whether each space feels too big or too small.
3. Write down how your needs for each function might change in the future. For example, if you plan to stay in the house and have kids, bedroom space is a consideration.
4. Given how the spaces currently feel and your future needs, adjust the sizes until the spaces feel right.
5. Add up the adjusted numbers.

Right now our number is around 1800 square feet, with a loft that can be built out later if and when our needs change. That number sounds big to me, but looking at the plans, spaces, and considering our future needs (we don’t plan to move from this house), it might just be our right-sized house.

What is the square footage of your right-sized living space? Do you currently live in more space than you need, or could you use some more room?

J.D.’s note: I love the Tumbleweed Homes. I want one.

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On today’s episode of The Personal Finance Hour, I’ll join Jim from Bargaineering to discuss the wonderful of banking. We’ll talk about online banks, offline banks, high interest savings accounts, current CD rates, and more. (We’ll also talk about how to optimize your accounts.)

This show will air live at 3pm Pacific (6pm Eastern). It’s much more entertaining for everyone when you call in to participate. We’d love to hear how you use your bank accounts. Do you have any tips or tricks you can share? Call us at 1-347-327-9144 share (or join the rowdy crew in the chat room).

Update: The show is over. Thanks to the five people who called in. We had a good time chatting about the difference between banks and credit unions, the virtues of reward checking accounts, the importance of customer service, and just what a money market account lets you do. Tune in next week when we chat about being thankful (surprise surprise).

The Personal Finance Hour
There are a few ways you can catch The Personal Finance Hour. You can listen through an audio feed at the show page, or you can also listen through this widget:

We’re also on iTunes! You can subscribe to The Personal Finance Hour as a weekly podcast by following this link (which will open iTunes).

Jim and I do this most Mondays — and we hope you’ll join us. We think this is a fun way to connect with readers and to help everyone learn more about money management. You can catch The Personal Finance Hour live at 3pm Pacific (6pm Eastern) nearly every Monday.

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This article is the eighth of a thirteen-part series that explores the core tenets of Get Rich Slowly.

One reason I got into financial trouble during my early twenties was that I wanted everything right now. I looked at what my parents had, and it didn’t occur to me that they’d been working their entire lives to get to that point. I wanted the same level of comfort, and I wanted it today. I wanted what I saw in the magazines and on TV. I wanted to start at the end, not the beginning.

In order to afford that sort of lifestyle, I went into a lot of debt. But even then, I couldn’t manage for long. I lived high on the hog for a couple of years, and then found myself back in the Real World — but with lots of extra bills to pay. In an attempt to reach the “finish line” of life sooner, I’d put myself further behind.

It wasn’t until a decade later that I finally understood that patience and perseverance are crucial to success — with money and everything else.

Patience and perseverance
There are those who get rich quickly. People do win lotteries. They do sign sports contracts or get “discovered” by Hollywood or sell their small businesses to big conglomerates. And some are able to profit from risk and luck, picking the right stock at the right time, so that their $10,000 investment grows into a million. These things happen. But these lucky few represent a tiny fraction of all those who achieve financial success.

More typical is the story of my neighbor, a real millionaire next door. He worked hard for thirty years or more, practiced frugality, and invested wisely. He wasn’t rich when he was young, but he enjoyed life while doing all of the “right” things. He was patient, and eventually this patience paid off. Now he’s able to do what he wants without worrying about money.

Getting rich slowly doesn’t mean you have to give up everything you love. Reducing your expectations and desires doesn’t mean you can’t spend on comic books or motorcycles or knitting supplies or shoes. It simply means recognizing that you can’t have everything you want. And often, you’ll have to wait for the things you do get.

Small steps become big strides
Personal finance can be daunting. When you first tackle your debt, the numbers are overwhelming. When you think about how much you need to save for retirement, you might ask yourself how it’s even possible. And when you think about having to work every day for the next 30 or 40 years, you may feel a pit in your stomach.

But you can accomplish big things if you break them into small pieces. Last month, I walked a marathon. If I’d focused on how long 26.2 miles actually was, or how many steps I’d have to take (over 50,000!), or the blisters I’d get on my feet, I never would have started. Instead, I set a target pace, and I tried to meet that pace every single mile.

The same applies to personal finance. For example:

• You can’t expect to go from $20,000 in debt to having $20,000 in the bank overnight. It takes time. You get out of debt one month at a time, one payment at a time. You get out of debt by sticking with it. Wealth is built the same way.
• Although it’s important to take advantage of opportunities to save big, you should also do what you can to save on the small stuff. Big wins come along infrequently, but there are many opportunities to “sweat the small stuff”. Given time, these small habits have a huge cumulative effect, and they can lead to financial prosperity.
• You can devote a lot of time to trying to pick the right stocks and timing the market for the best time to buy. But even the experts fail at this more often than they succeed. Instead, most financial advisers (and even billionaires like Warren Buffett) recommend that average folks take the “slow and steady” approach: Use dollar-coast averaging to make regular small investments in indexed mutual funds.

Instead of expecting to accomplish everything at once, recognize that meaningful change takes time. Be patient. Work hard. If your experience is like mine (and that of many GRS readers), you’ll find that after a few months (or years), you’re not only making progress, but you’re making more progress than you believed possible. Your slow and steady movements have become large, graceful strides.

The biggest loser
Here’s a confession: I’m a Biggest Loser junkie. Every season, the program follows a group of contestants as they attempt to lose weight by reversing a lifetime of bad choices. It’s the only reality show I’ve ever watched, and I love it.

In one episode last spring, contestants were challenged to pull NASCAR vehicles around a race track. The muscular men sprinted to an early lead. Meanwhile, former model Tara Costa — who had demonstrated patience, perseverance, and drive every week — put her head down and pulled at a moderate pace. The men tired. They began to flag, but Tara’s pace never faltered. One-by-one, she passed the jackrabbits and coasted to victory.

Tara, in green, passing Mike and gaining on Sione

I think of this challenge often. It seems to epitomize so much of what I’ve learned about life — and personal finance. As Tara pulls her car, she doesn’t worry about what the people around her are doing. She sticks to her game plan, moving slowly but surely toward the finish. Just as in the fable of the tortoise and the hare, slow and steady really can win the race.

(And, as a final note, I’ll point out that you’re only racing with yourself — not anyone else.)

This is the eighth of a thirteen-part series that explores my financial philosophy. These are the core tenets of Get Rich Slowly. Previous parts included:

• Tenet #1: Money is more about mind than it is about math
• Tenet #2: Goals are the gateway to financial success
• Tenet #3: Spend less than you earn
• Tenet #4: Pay yourself first
• Tenet #5: Small amounts matter
• Tenet #6: Large amounts matter,too
• Tenet #7: Do what works for you
• Tenet #8: Slow and steady wins the race

Look for a new installment in this series every Monday through the end of the year.

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Related Articles at Get Rich Slowly:

• A Short Holiday
• Making Progress: An Update on My Goals for 2008
• The Curse of a Big-Win Mentality
• Sure-Fire Ways to Jump-Start Your Savings
• On the Road to Financial Independence

This is a guest post from Sean Ogle, a former portfolio analyst who is now pursuing his goals of starting a business and seeing the world. You can read more from him at Location180. You can also follow him on twitter @seanogle. 

Have you ever thought about doing something different with your life? Maybe you’ve decided that you’d like to do more world traveling. Perhaps you want to explore that entrepreneurial idea that has always been buried deep inside you. 

For me, it was both. In my past life, I was a portfolio analyst for a small investment firm. While the job would have been perfect for the right person, I found myself yearning to do something more than just crunch numbers and help other people build their businesses. 

A few years back, job obligations cut my three-month trip through Europe down to three weeks. Ever since, I’ve had an urge to travel more, and held bit of resentment towards the normal 9-to-5. I wanted the freedom to get my oil changed on a Wednesday morning — I wanted the freedom of time. 

The catalyst for change occurred in March when all of my hard work earned me a 20% pay cut. I knew there was a better way for me to live. I wanted to be my own boss and see the world at the same time. 

I started researching business ideas and talking with other people who had seen success working for themselves. There was  general consensus that a combination of blogging and social networking were great starting points if I wanted to create a business online. So in May I began Location180, and set out to learn as much as I could by the end of the year. 

I knew that in order to be successful with my new lifestyle, I’d have to make changes in my day-to-day life. I’d have to do something that, despite my financial background, I’d never been very good at: stick to a budget. 

It wasn’t that I didn’t know how to stick to a budget. But my affinity for nice things always seemed to get in the way. When I saw something I liked, I’d buy it. The times I was most successful at sticking to my budget were the ones that resulted in me getting something I wanted, such as a new car or HDTV, for example. 

Over the last year, however, I’ve learned a lot about how to successfully prepare for a major lifestyle change. Probably the most important thing is to be diligent about applying the stuff you already know. For instance, one of the most important rules of personal finance is still very applicable: 

Pay yourself first
Seems like a simple concept — and it is. But I can’t tell you how many times in the past I have let bills, events, or other obligations get in the way of me putting 15% of every paycheck into my high yield savings account. 

This savings is essential when you make a lifestyle change. If things don’t work out as planned (in my case, I lost my job much earlier than expected), you’ll be glad you kept it up. Automating this process is the best way to ensure it gets done each month. You can’t spend what you never see. 

To take things a step further, I’d actually take whatever you’re saving and increase it by 25-50%. This will force you to make changes that you may never have made otherwise. In my case, I became the king of bootstrapping. In order to meet my goals of starting an online business while also traveling, I adapted myself to a more frugal lifestyle long before I needed to. That has made it much easier on me now that a lifestyle change is no longer a choice. 

You should also: 

Create a budget 
In the past I’ve used both Quicken and spreadsheets with only limited success. It wasn’t until I started using Mint.com that I really started to see success in my budgeting. Its ease-of-use makes this stand out among everything else I have tried. Two features in particular helped me save more money:

• The ability to categorize my spending in any way I see fit, and
• Being able to track trending over months.

I had no idea how much my car cost me each month until I started tracking all of the related expenses. It was tough to realize that I was paying over $500/month for transportation alone. Dusting off the old bicycle could definitely drop a couple zeroes off of that number! 

The next step toward a lifestyle change is to: 

Cancel accounts 
It’s funny how easy it is to rack up monthly expenses. I had expenses that I didn’t even know I had! 

After careful review of my monthly statements, I noticed that there was a monthly “credit protection fee” on one my cards that had been there since I set up the account — three years ago. I also found a $7/month web hosting account for some random domain I’d purchased and done nothing with. And don’t even get me started on the gym membership that hadn’t been touched in weeks. 

By carefully looking at your financial statements, you may find recurring monthly expenses that you’d forgotten about. (Or, in some cases, never even realized were there!) This simple step alone can help you save hundreds of dollars annually. 

And, of course, the most important step to a lifestyle change is to: 

Have a plan 
Depending on the lifestyle change you’re trying to pursue, there are specific ways you can prepare. Since one of my goals is to do more traveling, I’ve decided that getting more air miles under my belt is a worthy goal. I was able to rack up around 50,000 miles from opening a new mileage card and transferring my balances. I now use that card for all of my purchases, and pay it off in full every month. 

If you want to leave your job to start a small business, consider running it part-time while you’re preparing to make the leap. Depending on the size and scale of your business, you can register it quickly to start taking advantage of some of the tax benefits right away. The ability to write off things like a home office or mileage can be a great bonus, while giving you a head-start on your business plan. 

Ultimately, preparing for a lifestyle change isn’t much different from how you’d prepare for any big event, such as purchasing a car or buying a house. While it may take a little while for some people to adapt to living on a stricter budget, finding the courage to pursue the goals you’re really passionate about will make it all worth it. 

In January I plan on heading to either Central America or Thailand to work full-time establishing an online marketing business. Despite some nervousness, my planning has put me in a great position to succeed, and I couldn’t be more excited about the adventure to come.

J.D.’s note: If you have a success story that you’d like to share with other GRS readers, drop me a line. I’m a strong believer that the personal part of personal finance is much more interesting than the theoretical stuff. Photo by Eulinky.

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Related Articles at Get Rich Slowly:

• How Budgeting Can Improve Your Life
• Reader Success Story: Debt Free on $2,000 a Month
• links for 2007-06-12
• Saving Money vs. Making Money
• Festival of Frugality #39

Starting a Roth IRA is one of the easiest — and best — steps you can take to save for retirement. I know I’ve written a lot about the Roth IRA in the past, but I still get questions all the time. People find them intimidating. For example, Lynn wrote last week:

I’m a 36-year-old single mother of two. I want to start investing for my future, but I am so overwhelmed by all the information. I was wondering if you could give me some advice on my best options for a Roth IRA. I am a school teacher and earn $41,000 per year.

I am going to do more research, but I would appreciate some advice from someone who already has expertise in this area. I am not sure what I need to start a Roth IRA, or who I should go with. I don’t know much about mutual funds or anything of that sort, so any help and advice would be appreciated.

Let’s clear things up: A Roth IRA does not need to be confusing. In fact, a Roth IRA is actually fairly easy to understand.

Roth IRA basics
The Roth IRA is an individual retirement arrangement: It lets you save and invest for your future. An IRA is simply a holding account. It’s a label. When you own a Roth IRA, it contains nothing. It’s like a bucket, a place for you to put things. (Most people think of an IRA as an individual retirement account, which is fine, but it’s actually an “arrangement”.)

The things you put in your bucket are investments. You might, for example, buy a stock to put in your retirement account. Or maybe government bonds. Or certificates of deposit. The important thing to understand is that a Roth IRA is not an investment — it’s a place to put investments.

With many retirement accounts — such as 401(k)s and traditional IRAs — you contribute pre-tax money and are taxed when you take the money out during retirement. Because they work with after-tax money, earnings from a Roth IRA can be withdrawn tax-free at retirement.

Roth IRA rules and requirements
Because Roth IRAs are meant to encourage ordinary people to save for retirement, not everyone qualifies for them. If you do qualify, you can contribute up to $5,000 to your Roth IRA every year. If you’re 50 or over, you can contribute $6,000.

Who qualifies? Nearly everyone. However:

• If your tax filing status is single and you earn more than $105,000 per year, your contributions are restricted.
• If you’re married filing jointly, your contributions are limited if your household earns more than $160,000 per year.

You can use a Roth IRA even if you have a 401(k) or other retirement plan, but you must make your contributions by the tax deadline each year. (So, you have until 15 April 2010 to make your Roth IRA contribution for this year.)

The rules are a little more complex than that, but those are the basics. If you need more info, take a look at the resources listed at the end of this article.

Where to open a Roth IRA
Deciding where to start your Roth IRA is the most difficult part of the process. Many financial institutions offer IRAs. Each has its own strengths and weaknesses. Don’t fret about finding the perfect match — find a good match and then get started.

To make things simple, here are three big companies that provide Roth IRAs (though these are by no means your only options):

• Fidelity Investments offers a no-fee IRA. There’s a $2,500 minimum initial investment, but this is waived if you commit to $200/month automatic contributions. They offer 4,600 mutual funds, about a quarter of which have no transaction fee. In short, you can open a no-cost IRA at Fidelity with a $200 starting investment if you invest in mutual funds and you agree to contribute $200/month. Apply for a Roth IRA with Fidelity.
• It’s also possible to open a no-cost Roth IRA at The Vanguard Group if you elect to receive electronic statements. Otherwise, a $20 annual fee is charged until your Roth IRA balance is over $10,000. Your minimum to get started is $3,000 — except that you can start with just $1,000 in the company’s STAR fund. (The STAR fund is an mutual fund of mutual funds, a safe choice for beginners.) Additional contributions require a minimum of $100 unless you use their Automatic Investment Plan, in which case the minimum is $50. There are no fees to purchase the STAR fund. Start a Roth IRA at Vanguard.
• T. Rowe Price charges $10/year for Roth IRA accounts until you have a balance above $5,000, after which there is no fee. You need $1,000 to open your IRA, but this minimum goes away if you sign up to contribute at least $50/month with the Automatic Asset Builder. There are no sales fees or commissions to invest this money in T. Rowe Price mutual funds. Open an IRA at T. Rowe Price.

Opening a Roth IRA is easy. You’ll need some minimal bank account info and about 30-60 minutes of free time. If you’ve ever filled out a job application or applied for a credit card, you can certainly open a Roth IRA. Once you’ve completed your application, you can transfer money to the account. It might have to sit in a money market fund until you have enough saved to buy your first mutual fund, but that’s okay. You’re developing the saving habit!

Which investments to choose
Here’s where I cop out. I’m not a financial adviser. I don’t know your goals or risk tolerance. I can’t tell you were to invest.

And to be honest, where you invest doesn’t matter nearly as much as the fact that you do invest. To get some ideas, browse through the investing archives here at Get Rich Slowly. (Maybe start with these “lazy portfolios”.)

If you’re really stressed, pick a target-date fund that most closely matches the year you’ll retire. This probably isn’t the best option, but it’s fine. Just use it while you get in the habit of making contributions. You can always switch the money to something more appropriate later.

Learning more about the Roth IRA
In 2007, I ran a four-part series exploring the benefits of a Roth IRA. If you need more info about these accounts — or if you have questions — you should start here first:

• Part one: What is a Roth IRA and why should you care?
• Part two: How to start a Roth IRA and where to do it
• Part three: Which investments are best for a Roth IRA?
• Part four: Questions and answers about Roth IRAs

I’ve revised these articles and compiled them into a free e-book called The Get Rich Slowly Guide to Roth IRAs (518kb PDF). (Note that this e-book was produced in April 2008, so some of the info is a little out of date, especially about Zecco.) And if you want the official word on the subject, check out IRS publication 590, which is all about IRAs.

Now’s the part where you can tell Lynn how easy it is to set up a Roth IRA. (And share what sort of things you’ve invested in.) My own Roth IRA started with stupid stock picks (Countrywide, The Sharper Image) and has moved toward index funds. I’m all about making things easy right now!

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Related Articles at Get Rich Slowly:

• Clearing Up Roth IRA Confusion
• Roth IRA vs. Traditional IRA: Which is the Best Deal?
• Can You Have a Savings Account in a Roth IRA?
• Daily Links: Taxes, Batteries, and Frivolous Purchases
• Real-Life Choices: Retirement Savings vs. Debt Reduction

I’m old-school: I went to the bank to make a deposit today. (I make most of my deposits in person, inside the branch.) While I waited, I chatted with the teller, whom I know from many previous visits. “I’m writing a book about money,” I told him. “What’s the one thing you wish you could tell people about banking?”

“Save!” he said. He told me there’s a huge generation gap between savers and spenders. “The people who save are generally older. They don’t look like they have money, but they do. They’ve got a ton in their savings account and they chase the best CD rates. But the reason they have money is because they didn’t spend it when they were younger. They’ve been able to let it grow.”

“And that’s not what kids today are doing?” I asked.

“No way,” he said. “The young people I see spend all their money. They’re trying to impress their friends. They buy all this new stuff. Their bank balances are always low. They’re not going to have money saved like the older generation does.”

Then he gave me another great example. “There are people who come in here and you can see why they have money. You look at their account history, and the only thing that comes out is the big stuff, like their mortgage or their utilities. There aren’t a lot of $5 or $6 transactions.”

I laughed and said, “I’ll bet most people have tons of little stuff.”

“Oh yeah,” he said. “It’s all little stuff. But it’s that little stuff that kills you. That’s what will make it so you don’t have anything saved when you’re older.”

Before I left, I asked him if he had any tips or tricks I should put in my chapter on banking. We talked about a couple of ideas, and then he came up with something moderately clever (though it applies to just a few people): “If you’re going to overdraw your account,” he said. “Do it all at once.”

“What do you mean?” I asked.

“Well, let me give you an example. The other day, a lady called me to complain about overdraft fees. She’d been hit with a bunch of them at the same time. But when I looked at her transactions, I couldn’t believe it. She’d gone to the same grocery store four times on the same day, so she was hit with four overdraft fees. If she’d just gone once, she’d still have overdrawn her account — but only once.”

The teller also mentioned that nobody seems to know their bank balance anymore. “They don’t use a check register,” he said, “so they have to call to ask how much they have. But the problem is that what we show you have and what you actually have can be two very different things. It can take up to a week for some transactions to show up. You should track your spending, and not just trust what the ATM says.”

I thanked the teller — who looks like he’s 25, by the way — and left.

I wonder if it’s true that there’s a generation gap in saving. Has the older generation always saved? Or did they start out trying to impress their friends, too? I feel like I’m at a middle point, moving from the “spend to impress” mode of operating to a “who cares what other people think?” way of life. The latter is more liberating and it helps my bank balance.

I’m going to try to find time to interview my neighbor for my book’s banking chapter. I think she’s a manager at a nearby bank. I’d be curious to see what advice she has for people. But really, it doesn’t seem like there are a lot of fancy things you can do with a bank account. As long as you’re saving, you’ve shopped around for a good account, and you’re not afraid to ask to have fees waived, I think you’re golden!

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Related Articles at Get Rich Slowly:

• links for 2007-05-22
• The Money Savvy Pig: A Piggy Bank for the 21st Century
• Links Roundup: No Credit Needed Edition
• A Profile of Young People in Debt
• Daily Links: Twitterpated Edition

This post is from GRS staff writer April Dykman.

For the past couple of years, my husband and I have not exchanged traditional, wrapped-and-Christmas-bowed gifts. Instead, we plan an experience.

We started our anti-Stuff celebrations because neither of us could think of a gift we truly wanted. Then we’d each be scrambling to think of something, anything, since not giving a box with a bow was unacceptable. This way, the pressure is off, and we create memories of fabulous meals and trips to vineyards, instead of piling up Stuff to fulfill a gift requirement.

I’m not against traditional gifts, especially if you know it’s something the recipient will use or enjoy. But if you are at a loss for the hard-to-buy-for loved ones on your list, consider an anti-Stuff gift of consumables or experiences. Why?

• No risk that your gift will turn into someone else’s Stuff (quite likely for the hard-to-buy-for recipients)
• People are likely to remember a positive experience, but will probably forget about yet another shower gel gift set
• Easier than picking something that comes down to personal taste, such as perfumes, sweaters, knickknacks, etc.

Meaningful, personal gifts
Anti-Stuff gifts aren’t necessarily gift cards, which often feel a bit impersonal. Think about what would be meaningful to the recipient. If your sister is a busy mom, give her a couple of hours of babysitting and an appointment with a masseuse. Consider the following to generate anti-Stuff gift ideas unique to each loved one:

• Hobbies
• Lifestyle (parent, student, on-the-go, homebody…)
• Anything he or she has “always wanted to do”

Word of warning: make sure the gift is something the recipient would enjoy or something in which he or she has expressed interest, not something you like or think he or she should like! That holds true with any sort of gift-giving.

The anti-Stuff gift guide
Need some inspiration to get the creative gift-giving juices flowing? Consider the following suggestions, organized by interest:

The foodie

• Basket of consumables from the farmers’ market. I’ve made baskets filled with locally-made items such as jam, jelly, biscotti, granola, chocolate, honey, coffee, salsa, vinegar, and olive oil.
• Cooking classes. There are classes on everything from knife skills to sushi rolling to creating Tuscan feasts.
• Wine and cheese pairing class. Bonus points if it’s held at a gorgeous vineyard.

Photo by Matthew Oliphant.

The outdoorsy gal or guy

• Zip-line tour. Send the adrenaline junkie on your list flying through the trees.
• Kayaking lessons. Paddling is a great way to enjoy the local lakes and rivers.
• Cave tour. Give the gift of a tour or a special event. Some caves host dinner and a concert, all underground.
• Horseback riding. A day on a dude ranch is a nice way to get back to nature.

Photo by Shareski.

The arts lover

• Gift certificates to the local “artsy” movie theater. They’ll get to see the indie flicks without having to wait for the DVD release.
• A museum membership. Members typically receive perks such as unlimited admission, invitations to previews of exhibitions, a discount at the museum’s store, and invitations to special events.
• Dance lessons. Just make sure you know if your recipient is a belly dancer at heart or more of the foxtrot-type.
• Tickets to a performance. If it’s a date-specific event, you’ll need to be sneaky to make sure the recipient will be available, but tickets to concerts, plays, and other performances are memorable gifts.
• Music lessons. If your brother has always wanted to channel his inner Jimi Hendrix, indulge the fantasy with a few guitar lessons.

Photo by zabara_tango.

The sports enthusiast

• A round of golf. If their sport costs money, buy them some time on the green, at the batting cages, or wherever the sport is enjoyed.
• Tickets to a sporting event. One year I bought my husband tickets to a Dallas Cowboys football game for his birthday. I was living in an apartment complex owned by Jerry Jones, owner of the Dallas Cowboys. Tenants could purchase tickets to the game, including seats on a chartered bus to drive us the three hours to the stadium.
• Lessons in their preferred activity. Find out what they like to do and where they do it. Inquire about lessons.

The crafty type

• Art lessons. Sewing, knitting, sculpture, painting, drawing, photography, stained glass…there’s no end to types of art classes.
• Gardening gifts. Seeds, herbs, perennials, saplings, and bushes make great gifts for loved ones with green thumbs.

Photo by WonderMike.

For anyone

• Spa services. Massages are appreciated by most people, especially if they are hunched over a computer or on their feet all day. Foot massages and pedicures are good options for those who aren’t comfortable with full-body massages.
• A night at a nearby bed and breakfast. Only for those who have been very good this year!

Not that there’s anything wrong with gifts and bows…
This approach isn’t for everyone. I think children should get to enjoy tearing open a gift and having a few things to play with right away, rather than being told it’s a gift that will be a blast…later.

But I’d venture to say there are probably a few people on your list who would prefer a thoughtful, anti-Stuff gift that reflects their interests and doesn’t have to be stored, dusted, or worse, guiltily tossed in a Goodwill bin.

What do you think about anti-Stuff gifts? What types of consumable or experiential gifts are on your wish list?

J.D.’s note: For those concerned about the cost of these suggestions, be sure to check out last year’s list of homemade Christmas gifts.

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Related Articles at Get Rich Slowly:

• How to Buy and Sell Gift Cards
• Taking a Break
• The Consumer Reports Mother’s Day Gift Guide
• Daily Links: Frequent Flyer Master Edition
• Another Reason to Be Wary of Gift Cards

This is a guest post from Adam Jusko, founder of IndexCreditCards.com, an information and comparison site for credit cards that maintains a list of over 1200 cards. You can follow Adam on Twitter for quick credit tips and opinions. I’ve previously featured IndexCreditCards as “The Only Credit Card Guide You’ll Ever Need” as a source for credit card offers

Among recently-passed credit card regulations is a command that issuers stop giving credit cards to adults under age 21 unless these young people can show proof of income or have a co-signer who will vouch for them financially (usually a parent). The intent is to stop credit card companies from heavily marketing credit cards to college students — young people away from home for the first time who have been known to run up big debts that haunt them later.

Regardless of whether you agree or disagree with this regulation, it will no doubt mean more young people entering their early to mid-20s with no credit history. Because you need a credit history if you ever plan on financing a car or a home at a reasonable interest rate, this is an important issue. So, what should they — and anyone else with no credit history — do?

Here’s the simple plan I advocate: Get a secured credit card.

What is a secured credit card?
A secured credit card works like a standard credit card, but with a slight catch — you have to deposit money into an account as collateral before you use the card. The amount you deposit becomes equal to the size of your credit line. For example, if you deposit $500 into your account, you can charge up to $500 with the card. You then pay your balance each month, exactly like you would with a regular credit card.

A secured credit card is not the same as a debit card. You are responsible for paying your monthly charges with money you have on hand; your purchases do not get deducted from your deposited balance as they would with a debit card. The deposited money serves only as protection for the bank in case you don’t pay.

When you pay your card balance each month, the bank reports your payments to the credit bureaus, who begin to keep track of your credit usage. You’ve established a credit history! Each month that you make on-time payments, your credit history lengthens and improves, moving you closer to the high credit score that will get you good rates on future financed purchases like a car or house. (If you fail to pay or pay late, you’re still establishing a credit history – but a bad one.)

Beware of high fees
Secured credit cards do charge annual fees, but if you go with a major bank, they should be minimal. Among the secured credit cards I recommend are:

• Citi Secured MasterCard ($29 annual fee)
• US Bank Secured Visa ($35 annual fee)

Both of these banks will give you the opportunity to upgrade from the secured card to an unsecured card with no annual fee in the future. (US Bank offers this after 12 months, Citi after 18 months.)

On the flip side, there are many secured credit cards and unsecured credit cards out there that charge hundreds of dollars in fees while promising to help build credit. Stay away from them! The companies offering these cards are either preying on the ignorance of newbies or they are selling a product to people who’ve ruined their credit and are desperate to get it re-established. These cards are not for people with no prior credit history.

The easiest way to establish credit
Establishing credit is important to your financial future, and the easiest way to do so is via a credit card. You may not like credit cards, but consider this: Credit cards are the only financial tools that allow you to establish credit without forcing you to pay monthly interest. Understand the details of your credit card application, and as long as you pay your balance in full each month, you can establish credit for free (or almost free in the case of secured cards). If you choose to use credit responsibly, establishing a credit history can actually be very easy.

Previously at Get Rich Slowly, the folks from Index Credit Cards provided a guest post on 5 credit card company tricks (and how to thwart them). Photo by Fosforix.

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Related Articles at Get Rich Slowly:

• Ask the Readers: What if You Have No Credit History?
• Reader Question: Buying a House Without a Credit History?
• Ask the Readers: How Will My Family’s Credit History Affect My Own?
• How One College Student Handles Credit Cards
• Counterpoint: Debt-Free Living Has Its Drawbacks

As many of you know, my pal Chris Guillebeau is crazy. He’s been to 119 countries, and he just keeps on flying. He wants to see them all before he turns 35 (in April 2013).

As you can imagine, Chris has accumulated a hell of a lot of frequent flyer miles over the past few years. He says he currently has 676,583 miles in eight accounts. But not all of these come from flying. Chris has learned all sorts of ways to accumulate miles without taking to the air. Now he’s put together a new e-book called Frequent Flyer Master that describes how you can maximize your miles, too.

I haven’t read Frequent Flyer Master but I’ve read several of Chris’ other books. They’re packed with information. They’re not scams. Plus they come with money-back guarantees. If you’re interested in travel, consider buying this guide.

Meanwhile, from elsewhere on the internet, here are few of my favorite articles from the past week:

First up, Flexo from Consumerism Commentary offers a great rebuttal to my advice to do what what works for you. “Doing what works for you can be a trap,” he warns. This philosophy can:

• Make you think you have a license to ignore criticism.
• Make you ignore better options.
• Make you accept mediocrity as a way of life.

I think Flexo’s points are spot-on, and I like his conclusion. (I like it so much, in fact, that I’ll incorporate the gist into my book!) “What works is just the minimum,” he says. “Do more than that. Do what works and look for something better.”

Next, The New York Times has an interactive graph that shows the jobless rate for people like you. Lowest unemployment? White women ages 25-44 with a college degree (3.6%). Highest? Black men ages 15-24 who didn’t complete high school (48.5%). And people like me? Just 3.9%.

Also from The New York Times, here’s a story about buying into a Christmas without presents. The older I get, the more I dislike Christmas gift-giving. Does that make me a Scrooge? Not according to this article. (For more on this subject, watch for April’s Anti-Stuff Holiday Gift Guide later this week.)

Finally, here’s a round-up of recent money carnivals. These are great sources for more info about personal finance:

• Kelly from The Centsible Life hosted Carnival of Personal Finance #229.
• Provident Planning was the home of The Best of Money Carnival #23.
• Bob at Christian PF shared this week’s Carnival of Money Stories.
• The Financial Blogger hosted Carnival of Money Hackers #89.
• Over at Don’t Mess with Taxes, you can read Tax Carnival #59.
• And The Skilled Investor shared Carnival of Financial Planning #114.

Now, if you’ll excuse me, I’m off to finish chapter six of Your Money: The Missing Manual.

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This article is by GRS staff writer Adam Baker. Baker recently shared an in-depth video example of how you can save $521 when booking airfare online.

Recently my 19-month old daughter managed to get her tiny hands on a ballpoint pen. Normally, this wouldn’t have been a major event. This time was different. In the 30-45 seconds it took for me to notice, she’d thoroughly covered two-and-half cushions of our microsuede couch with a beautiful masterpiece in ink slashes and squiggles.

While I’m proud of the her dedication to detail and new art skills, this wasn’t exactly the platform I wanted to her display them on. I confiscated the pen and walked straight to the computer; I knew that time is of the essence with ink.

I found a wide variety of solutions on the internet. Two simple ones were most common: rubbing alcohol and/or Windex. Really? I knew water would only make matters worse, so my first though wasn’t to use rubbing alcohol.

I took a short walk to the corner store for a bottle of rubbing alcohol and a large pack of Q-Tips. Two l-o-n-g hours later, the ink was mostly gone. After the damp spots dried, the damage was all but invisible. Success!

As a fan of simplicity, I loved this easy, straight-forward solution to my problem. Afterward, I spent more time than I’d like to admit scouring the web for similar creative cleaning hacks that involve everyday products. There are more than you can imagine, but several in particular caught my eye.

The many uses for cola
It’s actually scary what cola can be used to accomplish. While there are many sites dedicated to amazing uses for this common soft drink, two cleaning solutions appear on almost every list:

• Polish tarnished chrome. Apparently the only other material you need is a piece of crumbled aluminum foil. Pour the coke on the chrome, scrub lightly with the foil, rinse with water, and repeat.  This can be used on everything from old motorcycles to bathroom sinks.
• Clean stains out of toilet bowls. Supposedly the acid in coke works well to break down stains in a toilet bowl. While this is commonly listed as a legit cleaning solution, a 2003 episode of MythBusters concluded that this was “busted” — it doesn’t really work.

However, the Myth Busters episode did confirm some other uses for cola:

• Shine and clean pennies,
• Help clean a battery terminal, and
• Even remove blood stains.

I’ve never been a huge fan of cola, and you can be sure just makes it more likely that I won’t be reaching for a can of Coke anytime soon.

Removing oil stains
Oil stains are some of the toughest to remove once they set in. When a spill occurs and you don’t have specially-designed cleaner on hand, you have two other options:

• Kitty litter
• Powdered dish-washing detergent

With either product, you should sprinkle the granules and let them sit for fifteen minutes or so. Next, soak with hot soapy water and scrub with a push broom. (Or you can use a pressure washer, if you have one.)

I also found an interesting suggestion for using dryer lint to soak up oil on Lifehacker.  The article doesn’t go into much detail, but this is a better option than paper towels or traditional towels, which tend to smear the stain rather than absorb it.

NOT-so-permanent markers
As with the oil stains, it’s exponentially easier to remove permanent marker if you get to the scribbles before they have a chance to set into the paint. In this case, many straight-forward cleaning solutions work very well.

Depending on the surface of the wall and type of paint, some options cause more fading than others. When in doubt, test the following options in a closet first so you can gauge gauge any negative reaction to the paint:

• Basic rubbing alcohol,
• Bathroom hand sanitizer, and
• Toothpaste (works better with baking soda as ingredient)

In all three instances, many people claim that scrubbing with a tooth brush gives good results!

Removing ink stains
In my own story above, we needed to remove ink from a microsuede couch. We had several options to choose from. In each case, though, experts suggested try the chemicals in small inconspicuous spots first since microsuede fabric has many different forms. Options included:

• Rubbing alcohol,
• Windex, and even
• Nail polish remover

In our case, the rubbing alcohol did an effective job when applied to small, targeted quantities.

But let’s face it: You’re more likely to get an ink stain on your clothes, not your microsuede sofa. When this happens, the most important rule is not to use hot water or apply strong pressure right away. Both hot water and intense pressure actually cause the ink to set in deeper, making it more difficult to remove. Instead, try applying:

• Hairspray,
• Foaming shaving cream, or
• Nail polish remover

After applying the chemical directly onto the stain, blot gently, switching the cleaning fabric frequently to maximize the amount absorbed. Once you’ve absorbed as much as possible, you can rinse the fabric thoroughly and attempt to wash it regularly in hot water.

Note: As a rule of thumb, you should test any alternative cleaning solution on a small sample before attacking the actual stain. And in nearly every case, you’ll have greater chance of success the quicker you’re able to start cleaning.

What other creative cleaning hacks have you found for around the house? Which of your homemade remedies have been most effective — and which have failed miserably?

Photo by geishaboy500.

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It’s been a long time since I shared a good self-deprecating story about my own financial foolishness. Let me remedy that today.

For the past month or so, I’ve been buried deep in writing my book. (I have bookhead, I tell Kris — my mind is wholly absorbed by this project.) I now spend most of every day (seven days a week) holed up in my office up the hill from the house. I walk up in the morning, work through the afternoon, and then walk home in the early evening.

Before I started writing the book, I’d take breaks to walk around the neighborhood or to walk home for lunch. I don’t do that anymore. Instead, I sit in this chair all day, staring at the screen. And I’ve developed the habit of breaking quickly to walk a few steps to the mini-mart next door.

I grab a candy bar, a bag of chips (or, more commonly, pork rinds), and a diet soda. I’m eating like crap and I’m frittering away my nickels and dimes. This stuff isn’t expensive, but it does cost me $3-$4 a day — more if I eat it for two meals.

As a result of this silly habit, my weight has ballooned and I have less money to spend on things that really matter — like comic books or steamed clams at my favorite Italian place.

“You’re being dumb,” Kris told me over the weekend. “You know better than this. You should be walking home to eat.”

“I know,” I said. “But when I have bookhead, all I want is to grab some quick snacks and get back at it.”

“Well, why don’t you take some good food to the office instead?” she asked. Good question.

This morning I drove the quarter mile to the office instead of walking. Actually, I drove to the grocery store first, stocked up on raisins and nuts and Clif bars and canned fish and fruit. I also bought a case of bottled water. (In another time and place, I’d groan about shelling out $3.49 for 24 bottles of stuff I could have for free, but it occurred to me that I’m spending that much on two bottles of soda alone. The bottled water is an instance of doing what works for me.)

How will this new set-up work? Time will tell. I’m a stubborn old cuss sometimes, and when I get set in my ways, they can difficult to change. For now, though, I’ve created a sort of barrier in front of my office door: a stack of food that’s good for me and cost much less than the junk at the mini-mart next door. In fact, I’m eating an apple and a bag of almonds even as I type this.

I don’t want to make it sound like I’m beating myself up over this. Yes, I’ve been lazy and stupid, but it’s not like I’ve ruined my life or anything. But I do find it interesting how easy it was for me to slip into bad habits: I’ve probably spent $100-$150 on junk food over the past month. It’s a reminder to keep a closer watch on my spending habits!

I’ll bet you find yourself doing silly stuff like this, too, sometimes. Right? Right? (Please tell me it’s not just me.)

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This article is the seventh of a thirteen-part series that explores the core tenets of Get Rich Slowly.

I struggled with debt for over a decade. I made several attempts to tackle the trouble, but nothing seemed to work. Compulsive spending was part of the problem — I bought anything I wanted, even if I couldn’t afford it — but there was another factor, too.

Everything I’d read gave the same advice for debt reduction: Start by paying off your highest-interest rate debt. I understood the logic behind this, but I couldn’t make it work.

The trouble was that my highest-interest rate debt was also my debt with the biggest balance (a fully-maxed $12,000 credit card at 19.8% interest). I’d plug away at this for several months at a time, but then give up because it felt like I was never getting anywhere.

Then I read about the debt snowball approach in Dave Ramsey’s The Total Money Makeover. It blew my mind. Here was somebody saying that it was okay (good even) to do something different, to start by paying low balances first. I tried it, and 39 months later I had eliminated over $35,000 in consumer debt.

In the process, I learned a valuable lesson. In order to succeed with money, sometimes you have to ignore the conventional wisdom. Sometimes you simply have to do what works for you.

The perils of dogmatism
There’s too much dogmatism in our culture. People are convinced that their way is the right way to do things. I don’t begrudge those who are certain they’re right. When something works for you, you have a tendency to believe it’s the right choice for everyone else, so you preach it with passionate zeal. I understand that.

The problem, of course, is that we’re all different. Your religion and your politics and your financial tips work for you, but won’t necessarily mesh with my situation and experiences. And mine won’t fit with yours. There are few one-size-fits-all solutions in personal finance — or anywhere else.

For example:

• As I hinted earlier, there’s no right way to pay off debt. Yes, you’ll save a little if you tackle the high-interest stuff first, but you may have better chances of success by starting with low balances instead.
• There’s no right way to invest. I like index funds, but you might prefer individual stocks.
• There’s no right way to tackle your mortgage. Some experts recommend paying it off quickly; others recommend stretching it out as long as possible to take advantage of the low interest. The best choice is the one that best matches your goals for the future.
• There’s no right way to be frugal. Some folks are unwilling to sacrifice organic groceries, and others are unwilling to take the bus. That’s fine. Find ways to practice thrift that fit your lifestyle.
• Joint or separate finances? There’s no right answer. Just because you can’t conceive that a couple can have a strong relationship with separate finances doesn’t mean that it’s impossible. Millions of people do it with no problems.
• There’s no right way to budget. Some people use a loose framework to guide their spending. Others need detailed line items. The best budget is one that you’ll actually use.
• There’s no single best savings account or checking account or credit card. There are plenty of great choices. Don’t listen to anyone who says you’re wrong for choosing a good option that works the way you do. (I don’t feel bad about using ING Direct, even if they don’t offer the highest rates.)

When you get trapped by the belief that there’s just one right way to do something, you set yourself up for failure: If this “right” method doesn’t work for you, you have no other options. You have to keep using it, even if you keep failing.

But if you allow yourself to consider other options, you give yourself multiple paths to success. Yes, you could use the “right” method — or you could take a different path to reach the same goal.

Doing what works
I’m not saying that it’s okay to do anything you feel. It’s not okay to keep on spending just because dealing with your debt is difficult or uncomfortable. But it is okay to try something new when what you’re doing doesn’t work. And it’s okay to ignore the naysayers who complain that you’re “not doing it right”. Your want to find what works for you, not for somebody else.

Don’t listen to anyone who tells you there’s just one right way to do something. Each person is different. What works for one person may not work for another. Be willing to experiment until you find methods that are suited to your life.

Make informed choices, understand the consequences, and focus on your goals.

This is the seventh of a thirteen-part series that explores my financial philosophy. These are the core tenets of Get Rich Slowly. Previous parts included:

• Tenet #1: Money is more about mind than it is about math
• Tenet #2: Goals are the gateway to financial success
• Tenet #3: Spend less than you earn
• Tenet #4: Pay yourself first
• Tenet #5: Small amounts matter
• Tenet #6: Large amounts matter,too
• Tenet #7: Do what works for you

Look for a new installment in this series every Monday through the end of the year.

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“It’s been a long time since you shared a recipe at Get Rich Slowly,” I told Kris last week. “What about that pot roast recipe?” she asked. “You love that.” “Yes. Yes, I do,” I said. This guest post from my wife may be the best thing I’ve ever shared at Get Rich Slowly. It’s certainly the tastiest.

I’m usually a from-scratch kind of cook, and the sort of “semi-homemade” ingredients for this pot roast make me cringe a bit. But although I’ve tried other recipes and other methods, this one beats them all hands-down. I got the recipe from an old friend after enjoying it at her house a couple of times and wondering why my pot roast was never as good as Kim’s pot roast.

This recipe has one cardinal rule: You must start with good beef. Otherwise why bother? We use a roast from the beef we buy in bulk; it’s pasture-fed on a local farm and the resulting beef literally falls off the bone in succulent shreds of savory goodness. This roast cooks all day at a low temperature. It’s simple enough to start before you leave the house so that it’s ready when you come home for dinner.

I use a Dutch oven with a tight-fitting lid for this recipe. If you don’t have one, you can line a roasting pan with foil, then cover the meat with another piece of foil, and then crimp the two all the way around to make a sort of meat packet. The goal is to hold the moisture in while the beef becomes completely tender. The roast forms its own gravy as it cooks.

Separately, I like to roast vegetables to serve as a side dish for this beef. In a shallow pan, I cook carrots, onions, and russet potatoes, drizzled with a bit of vegetable oil and seasons with salt and pepper. I cook them for 80-90 minutes at 400 degrees or so. If you aren’t lucky enough to have two ovens, make mashed potatoes on the stovetop instead.

I don’t recommend baking vegetables at the low oven temperature needed for this pot roast. Don’t try adding them to the roast; their high moisture content somehow messes up the texture of the beef.

Internet versions of this recipe exist using a crockpot on low for 8-9 hours. This might be worth a try someday, but I’m reluctant to meddle with perfection! I’ve also heard you can start with two cans of soup if you’d like more gravy at the end.

I like to serve this meal with a salad, homemade applesauce, and our favorite homemade bread.

Do you have a favorite low-effort recipe? What do you make that offers maximum flavor with minimum fuss?

J.D.’s note: This pot roast is fantastic. I cannot rave about it enough. In fact, I’m tempted to call Kris right now and ask if we can have this for dinner tomorrow. Yum. Photo by Merelymel13.

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This article is by GRS staff writer Adam Baker. Despite his best attempts, Baker struggles to budget while adapting to life in New Zealand.

Earlier this week J.D. tackled an important issue with his tenet Large Amounts Matter Too.

This concept goes by many names:

• Focus on big wins.
• Pick the low-hanging fruit
• Attack high-leverage areas.

You get the point: It’s efficient to do things that have major impact with minimum effort. J.D. wrote:

Some people spend so much time sweating the small stuff that they don’t bother to do the same on the big stuff. They’re penny wise and pound foolish, negating their daily scrimping and saving by making poor financial decisions that burden them for years. Kris has a co-worker who once bought an SUV for $43,000. After a year, he decided to trade it in, but could only get $23,000 for it. Ouch!

His advice is spot on. An intense dedication to frugality can often do more harm than good. Getting caught up in the details can lead to mistakes or oversights in areas that cost us thousands.

But there’s another less-talked-about side of the coin.

While you certainly don’t want to miss the opportunity to capitalize on a major event, you also don’t want to develop the habit of relying on them either. These type of large gains for minimum effort can make us lazy.

After all, why should you clip coupons when you could spend that time planning your next pay negotiation? Why would you save money by making your own products at home, when you could be aggressively monitoring the classifieds for the next killer deal on a car?

Why casinos want you to win money
People that have been around the gambling industry will tell you that winning on your first trip to the casino is much worse than losing. Why? It changes your mindset. Most people will go from “I’m probably going to lose, so I’ll just plan to have a little fun” to “Wow, that was easy! Next time I go back I’ll be playing off my winnings”.

Next, you convince yourself that the losing streak you’ve bumped into is just a natural part of how things work. Hitting just one hand will make up all your loses. From there, it only gets worse.

Casinos make their profits when they can detach you from the value of your money. If you win the first time you visit, that process has already started. They know the average person will be back and will spend far more money than the guy or gal who lost it quickly on the first visit.

Encouraging lifestyle inflation
In our finances, the big wins have the potential to detach us in the same way. The value of these events is lost if you use them as an excuse to not attack your impulse spending or creeping lifestyle inflation. We are a culture that loves to celebrate shaving $200 off our monthly mortgage with a new $300/month car payment.

The problem is that all to often, we create a zero-sum game. We end up shuffling back ten steps in our daily lives and then trying to make it up in one big leap. That works well as long as we can keep leaping back up. Occasionally, though, we stumble when trying to leap. And when we do, we fall flat on our faces.

A constant reliance on these big wins is not sustainable. They aren’t meant to be Band-Aids to cover our daily financial boo-boos.

Reversing the curse
The cure for this curse is balance: Neither obsessive frugality nor an intense concentration on the big-ticket items will lead to long-term success. Balance will.

These big wins can be powerful influences in our financial lives. We can use them as sparks to turn around a desperate situation, or as fuel to build momentum on our existing progress.

For Courtney and me, focusing on correcting our day-to-day habits has actually fostered more big wins. Getting the basic principles of money management and frugality under control has given us more time, relieved stress, and provided more freedom to pursue larger activities.

What about you? Have you experienced the curse of the big-win mentality? Which has been the leading focus in your financial life: the small daily habits or the higher-leverage large amounts?

Photo by Haundreis.

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This post is from GRS staff writer April Dykman.

A college professor once told my journalism class that freelance writing is something you should do on the side. It’s not anything you could make a living at full-time. 

I graduated and worked at an office job until I decided I wanted to become self-employed and do something that would give me more free time to write. A real job and a writer on the side, just like the professor had suggested. I went into real estate.

To say it was an awful fit would be an understatement. The very thought of cold-calling made me want to stay in bed with the covers over my head. What’s worse is that I wrote a total of one article that year. What in the world happened?

“Freelance writing can’t be a successful business.” That was my limiting belief. (To be fair, it was a belief I held long before the well-meaning professor reinforced it.) So I took a full-time job as an editor, and on the side I’d write maybe one or two magazine articles a year. I didn’t believe I could have a thriving freelance business, so I didn’t even try.

One small step
Early this year, I made the decision to put more effort into my freelance writing. Not too long after, J.D. mentioned that he was going to hire one or two staff writers. It sounded like a great opportunity, but I was scared to death to send the e-mail just asking to try out. What if I wasn’t selected? Even scarier was the possibility that I might get the job. What if I ran out of stuff to write? Freelance writing can’t be a successful business!

Soon after getting the staff writing gig, I picked up another writing client who found me through GRS. It was a breakthrough. I’ve since added two more projects to the list. I was actively pursuing and attaining everything I passively dreamt about for years. I took one tiny step that scared the hell out of me, and it snowballed.

Separating from limiting beliefs
My limiting belief shrinks every day because I’m slowly proving it wrong.

The funny thing is that once you stop identifying with a limiting belief, you start to recognize them everywhere. There was the well-meaning friend who thought writing the GRS try-out articles without being paid for them was a bad idea (when in fact it insanely boosted my business in less than a month). There are the people who stay in jobs they hate because they have a kid in college. There are the ones who say they have no time for a side business, or so-and-so only did it because they had money or the right contacts (Ramit calls this The Shrug Effect). I empathize with their reasons because I did the same thing for years.

No matter what your limiting beliefs, the steps to knock them out are the same. I only realized it in retrospect, of course, but the steps I took to grow my freelance business aren’t much different than the steps I took to overcome some of my other limiting beliefs, such as:

• Only people who are rich can travel to Europe.
• Getting into a boxing ring will end with a trip to the ER.
• I’ll see a shark if I scuba dive, and I’ll panic and die.

Round one: Set the intention
Thoughts have a significant effect on reality. Truthfully, this has always sounded like new-agey stuff to me, and I agreed wholeheartedly with J.D.’s review of The Secret.

But what I’m talking about is clearly defining an intention or goal and writing it down. I set the intention to expand my freelance business this year. No, it didn’t happen magically and without any effort on my behalf. I did the work, but first I had to be clear about what I was setting out to do, and I had to believe that I could do it. As I progress, I distance myself more and more from the limiting beliefs that held me back. 

Round two: Find mentors who are already doing what you want to do
Some of the most helpful, friendly people I know are people I’ve “met” online. I have a mentor in Canada who I have never met in person, yet she’s willing to take time out of her schedule to talk with me over the phone. She is making a living doing something that several people have told me is hard or impossible to do. I choose not to listen to them. I choose to hear how she is already doing this impossible thing.

Mentors also keep you positive. If you are feeling stuck or uninspired, contact one of your mentors to ask a question or reread an inspiring e-mail they sent. Block out the noise.

Round three: Ignore others’ encroaching limiting beliefs
It’s easy to be discouraged by other people’s limiting beliefs. Maybe you know someone who loves to tell others why something can’t or shouldn’t be done. If it’s legitimate constructive criticism, by all means, don’t dismiss it. But you can recognize limiting beliefs pretty easily, especially if you used to be the one coming up with them. Just smile and move along.

Or, use it as fuel. Sometimes nothing gets me more fired up than hearing the reasons I can’t do something. (Especially if that reason is because I am a female!)

Finally, keep a Word document with positive statements people have made. It’s cheesy, but consider this: How many times do we remember the nice or positive things people say to us or about us? Most people fixate on the negative, and that’s what they remember. You probably can recall dozens of awful moments all the way back to kindergarten, but do you remember the professor who told you you have a talent for writing profiles or the editor who said you wrote a killer article? Write down the good stuff, and read it when you need a pep talk.

Round four: Make a move.
Do something small to get the ball rolling, even if you think you will fail, cancel, or back out later:

• One e-mail to rev up a freelance business.
• A $400 deposit on a trip to Europe.
• Weeks of training in the boxing gym on heavy bags and focus mitts.
• Reserve a class at a dive shop.

Once you light the fire, it’ll be harder to put the brakes on.

I can still list limiting beliefs I’m holding, and I’m sure there will be many more in my future. The solutions to overcoming these fears start with a desire to take action. What limiting beliefs do you hold? How are you working to overcome them?

J.D.’s note: For more on this subject, check out my advice on how to fight financial trolls.

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Whew! It took a long time — nine days instead of the scheduled seven — but I finally finished the frugality chapter for my book. Do you know how difficult it is to compress that topic into a single chapter? It’s worth an entire book by itself!

The version I just submitted to my editor is 11,643 words and includes April’s should I buy it? flowchart. I expect the published version to be significantly shorter, but we’ll see.

Though I’ve been writing nearly non-stop for the past week, I have managed to collect more articles than usual to share. Rather than provide extended commentary, I’m just going to bullet-point the good stuff today:

• The Consumerist has a story how Radio Shack charges 24 times more for the same product than the dollar store next door. You should comparison shop whenever possible, folks.
• The Art of Manliness (still one of my favorite blogs) explains how to change your motor oil. This is something of a lost art. I used to do this on my first two cars, but haven’t done it myself in 15+ years. Have you?
• The Simple Dollar just celebrated its third blogiversary. To mark the occasion, Trent listed ten things he’s learned about money and life since he started the site. Good stuff.
• Baker doesn’t just write for Get Rich Slowly. He also has his own blog. Or does he? Over at Man vs. Debt, guest author Jenny Newcomer posted a great story about how she paid off $15,000 in nine months by selling stuff on eBay.
• Did you know Goodwill offers on-line shopping? ShopGoodwill.com features the good stuff donated to Goodwill thrift sores. You can browse and bid on art, antiques, and collectibles. Cool beans.
• Wojciech from Fiscal Fizzle seems to have a permanent spot on these round-ups! This week, he’s written about how to send the SWOT on your money, where SWOT stands for strengths, weaknesses, opportunities, and threats. Wojciech explains how to use this framework to tackle your personal finances.
• Lastly, I wanted to point out that Kiplinger.com has finally re-vamped their website. It’s no secret that I hated their previous layout. It was an abomination. The new site is much more user-friendly.

Before I start on the next chapter of my book (Chapter 6: Boosting Income), here are some recent personal finance carnivals. These round-ups are great ways to explore other money blogs:

• Money Crashers hosted a spooky Carnival of Personal Finance #228.
• PT Money curated this week’s Carnival of Money Stories.
• My Journey to Millions presented Carnival of Debt Reduction #215.
• And Mike from Gather Little by Bittle rounded up Festival of Frugality #201.

Have a good evening everyone. I’ll see you in the comments of April’s post tomorrow morning…

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• Daily Links: Compound Interest, Web Income, and Happiness

I used to wonder why my colleagues’ blogs became strangely silent when they were working on their books. Haha. I don’t wonder anymore. Writing a book is an all-consuming process that’s difficult to describe. I’m thankful I recruited April and Baker as staff writers before I began working on my own book.

Progress on Your Money: The Missing Manual actually ground to a halt this week. Well, that’s not strictly true. I did miss my deadline on Monday, but it’s not for lack of trying. I’ve already written as much (~12,000 words) for the frugality chapter as for two normal chapters combined. The problem is that there are too many ways to save money! So, I’m producing a ton — I just didn’t finish the chapter on time.

The topic I’ll be tackling this morning is frugal fun. As I plotted the section last night, I realized we haven’t discussed this subject much at Get Rich Slowly. Why not? There are lots of cheap ways to have a good time.

While I finish pulling this section together, I thought it would be fun to poll you for suggestions. How do you have fun without spending a lot of money? Better yet, do you have hobbies or pastimes that actually make you money? I’ll go first.

Here are some of the ways I’ve learned to find maximum fun with minimum cost (and yes, some of these will be in the book):

• Take a class. Community ed classes usually cost about $50. Classes at the community college might run up to $200. While this may not seem frugal, remember that you’re not only having fun while you take your course, you’re (theoretically) picking up a skill that you can use to improve your life.
• Read a book. Boring, I know, but this is still one of my favorite ways to relax. For the past few years, I haven’t had much reading time. That’s changed in recent months. (Well, until I started the book, anyhow.) Now I remember how much I love Dickens and Twain and, yes, even Proust. If you use the public library or a used bookstore, this can be a frugal hobby, indeed.
• Exercise. I love activities that do double duty. When you find an exercise you love to do, you’ll not only enjoy yourself, you’ll also enjoy improved fitness, which in turn will save you money.
• Volunteer. I admit that this isn’t something I’ve done yet, but I’ve heard of other who have. The idea appeals to me. Find a way to do something that you love while also helping others.
• Make use of what you already have. Ah, this is a big one for me. I’ve shared before how much Stuff I have. At one time, I owned over 3,000 books. I still have about a thousand volumes, many of which I haven’t read. Plus tons of comics and music and movies. If I started using the stuff I already own, I’d probably never run out of things to do.

Last week, I interviewed Trent from The Simple Dollar to get his suggestions for simple pleasures. He had some great ideas. My favorite thing he said was this:

The mistake most people make is looking for the free stuff first. Look at the things you really enjoy doing. Once you know what you like to do, there’s almost always ways to do these cheap.

This is very true. If you know what it is you like to do, there are always people doing the same thing for very low cost. (Well, maybe not if you’re into boating. I’m not sure how you make boating a frugal hobby.) If you’re patient and clever, you can find out how others are doing what you want to do without going broke.

So, how about it? What sorts of frugal things do you do for fun? What info should I pass on to the readers of my book?

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Related Articles at Get Rich Slowly:

• Money and Values: When Frugality Goes Too Far
• My Frugal Life
• Save Money with a Frugal Buyers Club
• links for 2007-02-09
• links for 2006-11-17

This is a guest post from Robert Brokamp of The Motley Fool. Robert is a Certified Financial Planner and the advisor for The Motley Fool’s Rule Your Retirement service. He contributes one new article to Get Rich Slowly every two weeks.

Every summer, my wife and I cull our closets for stuff we and our kids no longer use. This is followed by a yard sale (complete with the obligatory lemonade stand from our kids), and the items that aren’t sold get donated to a local thrift store that uses the proceeds for charity. In the end, we have more closet space, some extra cash, an entrepreneurial opportunity for our kids, and a tax deduction.

And a little bit of regret.

Many of the items that get sold or donated were gifts we purchased for our kids or each other. They were enjoyed for a short time — or, sometimes, not at all — then relegated to the Pile of Misfit Stuff. It’s like that Marla Singer line from the movie Fight Club:

Someone loved it intensely for one day, and then tossed it. Like a Christmas tree. So special. Then, bam, it’s on the side of the road.

Kinda depressing. And expensive.

I know: It just turned November — do we really need to start talking about the holidays already? Well, if you’d rather not, read the rest of this post with your eyes closed. But my wife and I are already planning, because this year we are trying to avoid spending money on gifts that only provide a onetime squib of joy.

We know that no gift will be enjoyed forever, and that part of the fun of the holidays is letting lose a little bit. Also, we’re a little surprised each year by which presents turn out to be the favorites, so just limiting the number of gifts makes us a little nervous. Maybe we’ll cut out the wrong ones!

Our solution is to make an extra effort to spend less on the presents we give, and to give presents that will survive next summer’s closet-culling. Here are some things we’ve learned through the years:

Give things that provide repeat pleasure
Obvious, I know. But it’s not so obvious when you’re shopping. Two Christmases ago, we bought our son a Spider-Man action figure that climbed on doors. It looked so cool! And it was pretty fun…for about five minutes. Compare that to the Roku box I bought my wife last year. It allows Netflix subscribers instant access to thousands of movies and TV shows (though not necessarily the recent blockbusters). We don’t have cable TV, so NetFlix is our main source of movies. By getting the Roku box, we cut our Netflix subscription down from three DVDs at a time to one, saving $8 a month, which paid for the box in less than a year. And we use it several times a week.

When it comes to kids, we’ve found that gifts with narrow uses get used the least. Conversely, gifts with multiple uses, in all sorts of places, and in all sorts of spaces, get the most action. The classic example is Legos, which my kids play with in their rooms, in the bathtub, in the car, and even use for homework projects. (In fact, the Legos I was given as a kid serve as the foundation of my kids’ Legos collection; that’s a gift that has retained its usefulness!) A slot-car racing set, on the other hand, requires set-up, takes up space, and the cars just go ‘round and ‘round and ‘round.

Get it used
We’ve already started prowling Craigslist for things our friends and family might want. If items on your “To Buy” list are suitable to be given pre-owned, now’s the time keep an eye on the classifieds and (if you have an open-ended “To Buy” list) sites like Freecycle.org.

Buy year-round
This is something my wife does very well. She buys potential presents at all times of the year, when she finds them at excellent prices, and keeps them in the “gift box” in our basement. It’s also handy to have when you’re invited to a birthday party and don’t have time to get a gift.

Give experiences over stuff
This may seem to contradict our goal of buying things that last, but you know what they say about memories and all that. For my mother’s 70th birthday, my sisters and I took her on a trip. It wasn’t exactly cheap, but she valued it more than anything I could have wrapped. Plus, some experiences really can be the gifts that keep on giving, such as art, photography, or cooking classes (complete with providing babysitting services, if required for the recipient to attend the classes).

Buy in bulk
Sierra Black recently wrote about the pitfalls of buying in bulk, and I agree. But if there’s ever a time to save by buying a lot of stuff, it’s the holidays. It works for gifts, and for food if you’ll be entertaining or hosting relatives. As an experiment a couple of years ago, I looked at how much I’d save by shopping at Costco compared with my regular grocery store. I bought nearly identical items at both places and spent 37% less at Costco.

Underwear!
One holiday season, I bought pairs of white underwear in bulk, decorated them in ways not appropriate to discuss on a family blog, and gave them to my friends. I assume they were gifts that got multiple uses, though I didn’t perform any random spot-checks. The point, of course, is that homemade gifts really can be the most memorable…and least-expensive.

Be honest about what you don’t want
I have a very spotty record when it comes to buying things for my wife. In the past, she was too nice to tell me when she didn’t really like something I bought her. So it stayed in our closet until the next summer, and then…well, you know. Now, I keep all receipts, and she’s much more comfortable returning items that I gave her. (And I’ve been better about getting her friend’s help at holiday time.)

J.D.’s note: Robert may be worried that it’s too early to write about Christmas, but if Google traffic to this site is any indication, the Christmas season started weeks ago. Last year’s article on homemade Christmas gifts has been on fire!

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Related Articles at Get Rich Slowly:

• Christmas 1950
• Best Dates for Holiday Travel 2007
• December 24, 1958: A Six-Dollar Christmas
• links for 2006-12-01
• The Four Things Children Really Want for Christmas

On today’s episode of The Personal Finance Hour, I’ll join Jim from Bargaineering to discuss financial rules of thumb. Rules of thumb are no substitute for proper analysis, but they can be an excellent way to make general plans.

Today we’ll talk about things like:

• When should you repair an appliance and when should you buy new?
• When should you refinance your house?
• How much of your investments should be in stocks?

This show will air live at 3pm Pacific (6pm Eastern). It’s much more entertaining for everyone when you call in to participate. We’d love to hear your rules of thumb. When do you use them — and when don’t you? Call us at 1-347-327-9144 share (or join the rowdy crew in the chat room).

The Personal Finance Hour
There are a few ways you can catch The Personal Finance Hour. You can listen through an audio feed at the show page, or you can also listen through this widget:

We’re also on iTunes! You can subscribe to The Personal Finance Hour as a weekly podcast by following this link (which will open iTunes).

Jim and I do this most Mondays — and we hope you’ll join us. We think this is a fun way to connect with readers and to help everyone learn more about money management. You can catch The Personal Finance Hour live at 3pm Pacific (6pm Eastern) nearly every Monday.

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Related Articles at Get Rich Slowly:

• The Personal Finance Hour, Episode 11: Frugal Weekend Fun
• The Personal Finance Hour, Episode 12: Earning Extra Money
• The Personal Finance Hour, Episode 3: Finding Balance
• The Personal Finance Hour, Episode 4: Couples and Finances
• The Personal Finance Hour, Episode 13: Credit Scores with Liz Weston

This article is the sixth of a thirteen-part series that explores the core tenets of Get Rich Slowly.

Last winter, Kris and I re-financed our mortgage. In one fell swoop, we trimmed our monthly payments for principal and interest from $1386.60 to $1137.69, boosting our cash flow by $248.91 per month.

If we had consumer debt, that’s $248.91 per month we have could used for our debt snowball. It’s $248.91 per month we could stick in our retirement accounts, or to put into savings accounts for our trip to France next year — or to pursue other hobbies and interests. Really, it’s $248.91 we could use for anything we wanted. (As it happens, we chose to use that money to accelerate our mortgage payments.)

There’s no question that frugality is an important part of personal finance. It’s good to clip coupons and to mend broken furniture and to turn the thermostat down. But it’s even better to shop around for the best deal on a mortgage. Everyday frugality can save you a little money consistently, but by making smart choices on big ticket items, you can save thousands of dollars in one blow. Or you can boost your cash flow by hundreds of dollars per month.

Some people spend so much time sweating the small stuff that they don’t bother to do the same on the big stuff. They’re penny wise and pound foolish, negating their daily scrimping and saving by making poor financial decisions that burden them for years. Kris has a co-worker who once bought an SUV for $43,000. After a year, he decided to trade it in, but could only get $23,000 for it. Ouch!

Now obviously, you only get a few chances in your life to save big on a home or a car. You rarely make financial decisions involving tens (or hundreds) of thousands of dollars.

However, you probably do make other big decisions several times a year. You buy a camera or a television or a new piece of furniture. You book a cruise or fly home for Christmas or hire somebody to work on your house. These are prime opportunities to save money. Whenever you anticipate a big expense, you should look for ways to maximize the value you get for your dollar.

As I’ve shared before, here are the guidelines I use to steer my shopping for big-ticket items:

• Know what you want before you start. If you’re buying a vacuum cleaner, what are you going to use it for? What features do you need in a television? What features do you want? When I bought a small digital camera in 2007, I jotted a quick wishlist: wide-angle lens, large display, easy-to-use menu, good video quality. Some of these items (like wide-angle lens) were much more important than others.
• Set a budget. Ideally, you’d set a budget for your purchase before you started shopping. That’s not realistic. You can’t know how much a dishwasher costs until you actually look at a few. But once you have a sense of the landscape, decide how much you’re willing to spend. If you don’t set a budget to start, it’s easy to succumb to “desire inflation”. When shopping for my digital camera, I had a budget of $300.
• Research your options. Once you’ve created a features list and a budget, search for options that meet your requirements. In most cases, Consumer Reports is a great place to start. Your local public library probably has a copy of the annual Consumer Reports Buying Guide. But don’t discount the web. I often do product research through Amazon.
• Make a selection. Once you’ve done your research, you’ll probably find one or two items that seem most promising. (There’s rarely one perfect choice.) I tend to write down the manufacturer and model number of my top three choices before I move on to the next step. In 2007, I was able to narrow my choices down to two camera models, both of which were within my budget.
• Compare prices. Now that you have a shortlist, begin researching prices. Again, check Amazon. Check other online vendors. Check your local stores. Don’t forget to consider used or refurbished items.
• Make the purchase. Once you find the best source for the item you want, buy it. Be confident that you’ve researched price and features so that you know you’re getting a good deal.
• Protect your investment. The older I get, the better I am about saving warranty information and boxes. (If we had a smaller house, I’d only save boxes for a couple weeks. Because we have space above the garage, I save them forever.) A little foresight when you buy a product can save a lot of headache down the road.

But large amounts don’t just matter when you’re refinancing your house or shopping for a new plasma TV. One of the best ways to discover the power of large amounts is through boosting your income. Whether that’s through negotiating your salary, asking for a raise, or changing careers, a larger income can have a huge impact on your finances.

Remember: Saving money on the little things every day is great, but saving money on the big things can make an awesome difference to your budget.

This is the sixth of a thirteen-part series that explores my financial philosophy. These are the core tenets of Get Rich Slowly. Previous parts included:

• Tenet #1: Money is more about mind than it is about math
• Tenet #2: Goals are the gateway to financial success
• Tenet #3: Spend less than you earn
• Tenet #4: Pay yourself first
• Tenet #5: Small amounts matter
• Tenet #6: Large amounts matter,too

Look for a new installment in this series every Monday through the end of the year.

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Related Articles at Get Rich Slowly:

• Small Amounts Matter
• Do What Works for You
• Slow and Steady Wins the Race
• Small Amounts Matter
• The Curse of a Big-Win Mentality

It’s been a strange October for me. At the first of the month, I began the transition to working full time on my book, Your Money: The Missing Manual. It’s a much different challenge than blogging, and it’s taking all my time. In theory, the book writing will be done in a few months, and then I’ll be able to devote more attention to GRS again! Thank you for your patience while I pursue this life-long goal.

Meanwhile, I was pleased with the stuff I did write here during October, and the contributions from staff writers Adam and April, and from the guest authors. And, of course, I always appreciate your contributions to the discussion.

Here are some of the best Get Rich Slowly articles from the month of October:

• October 1st: Happier
• October 6th: How to stop buying clothes you never wear (by April)
• October 10th: The guilt of wealth
• October 14th: 9 ways to knock the socks off your next landlord (by Baker)
• October 15th: Five steps to six figures in seven years (a guest post from FMF)
• October 17th: What if your high-paying job makes you miserable?
• October 22nd: The paradox of choice and the dangers of perfection

The blog isn’t the only part of this site. If you have burning questions about personal finance, one of the best places to get answers is the Get Rich Slowly discussion forum.

The forum is a great place to chat with your fellow readers. Have questions about emergency funds? Ask! Want to chat about cheap vacations? This is the place to do it. The forums have over 3500 registered users and over 41,500 posts.

Subscribe!
You may subscribe to Get Rich Slowly via any of the following methods:

Finally, you can follow me on Twitter or join the Get Rich Slowly blog network and/or the Get Rich Slowly page on Facebook.

This weblog is a success because of you and your support. As always, I welcome reader contributions, either as ideas for stories, or as guest entries. If you have any comments or requests to improve this site, please feel free to pass them on.

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Related Articles at Get Rich Slowly:

• The Best of Get Rich Slowly: October 2007
• The Best of Get Rich Slowly: October 2008
• Best of October, and How to Subscribe to GRS
• links for 2006-10-03
• A Year’s Worth of Credit Card Applications

Every month, my wife and I track how much time and money we spend growing food. This is the report for October 2009. (Here are the results for 2008.)

As those of you who follow me on Twitter already know, it’s been a l-o-n-g Saturday filled with all sorts of misadventures. Murphy’s Law has been in full effect this Halloween. I’d meant to post this month-end garden summary around noon, but now will have to do. In fact, there wouldn’t be a summary at all except that my wife sat down and wrote it for me. Here’s what Kris has to say about the month of October…

October arrived with the typical cold and damp, bringing Portland’s garden season to a close. During the fall and winter we’ll enjoy the hearty foods we’ve packed away from this year’s crops, until by early spring we’re ready to begin anew. We’ve been eating fresh fruit and vegetables from our garden patches since May’s first strawberries. Not bad!

The last of the tomatoes
We harvested the last of the garden produce this month. Rain and wind don’t mix well with ripening tomatoes, so I picked 15 pounds of semi-ripened tomatoes to take inside. Stored in a cool place between layers of newspaper, some of these will turn out to be fairly delicious. The rest will rot.

The cucumber plants coughed up enough for another month’s worth of salads, and the beets were ready for roasting. (In fact, I’m roasting some in the oven even as I write this.) In addition, I tore out the jalapeno plants and dried the peppers in slices in the dehydrator. Some went to our neighbor who loves spicy foods; the rest will go into winter cornbread and soups. 

Usually I collect the fallen English walnuts in our front yard, but the squirrels have been especially voracious this year! And my volunteer vine turned out to be a birdhouse gourd that gave me two mature gourds for fall decorating.

The fruits of autumn
I spent time in the mud ripping out cucumber and squash vines, then the beans and tomato plants, and tidying up the apple trees.  We also dug out the beleaguered gooseberry plants and three poorly-producing 25-year-old blueberries. We invested $84 in five new blueberry bushes of various types and sizes. (We’re trying to stagger the berry harvest so it lasts as long as possible.) As we rake leaves in our yard, we’ll spread them onto the garden bed to mulch the asparagus and keep down the weeds over the winter.

In the waning hours of sunshine, early October in our neighborhood smells of Concord grapes. We wait until the scent tells us they’re ready, then head over to the generous neighbor’s yard to pick all we can use. Our own young vines produced a good crop as well. This year, J.D. gathered about 30 gallons of mixed purple and green Concords. I made juice (22 quarts) and grape jelly. It’s a long day but so worth it every time we open a jar. We also made another batch of applesauce from twenty pounds of fruit brought back from an orchard by a friend and fellow canner.

This summer’s total for canned food: 140 quarts of assorted pickles, apple/pear sauce, juices, jams & jellies, salsa and fruit. My pantry is full to bursting! I love being able to eat this local bounty during our winter, rather than buying produce that’s been shipped from far away. 

In addition to the canned food, the freezer is stacked with berries and assorted sauces, and dried fruits and herbs are stored in a dark and dry place. All this “free food” keeps my grocery spending in check even when we’re not eating directly from the garden. (It’s like a savings account for food!)

Monthly totals
The fall is when I tally the herbs for the year. Our herb garden provides me with sprigs and snips all year. The annual herbs are finished (basil, stevia, cilantro) and others die back until spring (lemon balm, oregano, mint, lavender) but the perennials will keep going for our winter kitchen use (rosemary, chives, bay leaf, sage & thyme). Throughout the summer, I’ve dried lavender flowers, mint and lemon balm, stevia and raspberry leaves for making tea infusions.  Altogether, I estimate that the herb garden has produced at least $50 of harvest.

Here’s the tally for October’s harvest:

• 56 jalapeno peppers @ $0.29 = $16.24
• 18 cucumbers @ $1.29/pound (about 5 cukes)  = $4.64
• 5 bunches mixed beets @$2.99/bunch = $14.95
• ~9.64 pounds of tomatoes @$1.99/pound = $19.18
• 8 pounds grapes from our vines @$3/pound = $24.00
• Assorted herbs, all season $50.00
• Costs: 5 blueberry bushes ($84)

Yearly Totals

Here are this year’s totals through the end of October:

Final word
This garden project is not a formal experiment. Kris and I are long-time hobby gardeners, and we have set ways that we do things. This year, we’re trying to incorporate some new ideas from GRS readers, but most of the time we’ll do things the way we have for nearly 15 years.

We’re not trying to be 100% organic (though we are mostly organic through our normal practices). Nor are we trying to be 100% frugal. Instead, we’re trying to see just what our garden costs and produces based on our normal habits. We hope the results of this experiment will help us find new ways to economize and to improve our crops.

You can read about my goals for this series in The year-long GRS project: How much does a garden really save?

p.s. Happy Halloween!

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Related Articles at Get Rich Slowly:

• The Year-Long GRS Project: How Much Does a Garden Really Save?
• The GRS Garden Project: June 2009 Update
• The GRS Garden Project: September 2009 Update
• The GRS Garden Project: November Update
• The GRS Garden Project: July 2009 Update

This post is from GRS staff writer April Dykman.

When you have a need or a problem, there’s usually a solution that can be bought. Buying a solution is often the easiest and fastest way to solve a problem — but it also can be the most expensive.

When my husband and I were in debt-repayment mode and had our discretionary spending locked down, I began to see that there are alternative solutions to problems that I once thought could only be solved by buying something. Sometimes quality counts, but more often than not, I would choose a solution that required spending more than necessary, when some forethought might have yielded a solution that was less expensive (or even free). Or maybe if I had stopped to think about it, I’d have realized it wasn’t a critical problem, and I could just choose to do nothing about it.

We set a strict budget while we were paying off our debt, so it was necessary to think about alternatives before every purchase to meet our payment goals. The great thing is that it became ingrained in me, and it’s something I continue to try to do. Here are some of the techniques I use.

Repair what you can
Repair what you have instead of replacing it. You can do this with clothes, appliances, furniture, and cars. I know someone who used throw away a shirt when it was missing a button rather than paying to have it mended, or learning how to sew on a button himself.

But even if you’re not apt to go the do-it-yourself route, sometimes paying for a repair is worth it when it’s something that is expensive or difficult to replace. Last year I took my boots to a shoe doctor for the first time. I was ready to replace them, but I thought I’d try a repair shop first, and I was pleasantly surprised. The boots were re-heeled, the leather was conditioned, and they looked good-as-new. It would have been much more costly to replace them.

Delay spending
Put off the purchase. People do this if they lose their jobs or if they live paycheck-to-paycheck and run out of money at the end of the month. I do it as a game when the credit card closing date is coming up, just to keep the number as low as possible.

Simply shelf the issue for the time being. Give it a week or two. (Or 30 days.) You might even think of a better solution during that period.

You also can do this with regular services. See how long you can stretch out time in between haircuts, for example, especially if your cut is low-maintenance to start. Stretching it out just four more weeks in between appointments reduced what I spend in a year by one-third. And you know, so far my hair is just fine.

Rent, trade, borrow, or take
Can you borrow or trade for a solution? If you want a book or a DVD, try out a service like Book Mooch or Swaptree. Try renting tools if you won’t use them enough to warrant owning them. See if friends or family members will let you borrow a tool or appliance (just be sure to send a lovely thank-you note).

Also, don’t forget to check out sites like Freecycle for furniture, appliances, toys, and more. Items are given away for free; you just pay for the gas to pick up your stuff.

Plan ahead
Many times we overspend because we’re pressed for time. Maybe you have to get a last-minute Christmas gift for a picky relative. The mall is typically where we end up in that kind of situation, and it’s not likely that you’ll find the perfect gift at a killer price when you’re in a hurry.

Planning ahead gives you the time to find the perfect gift at a great price, or maybe even free if you’re really creative.

Planning ahead isn’t limited to gifts. You can plan ahead for travel, social events, house guests, and more. You can plan your expenditures for any situation that you know about ahead of time.

Find creative solutions to achieve your goal
There’s usually more than one way to solve a problem or reach a goal. Craving Chinese take-out? Try making stir-fry at home. Want to have a fun Saturday night with your friends? Throw a potluck or host a game night instead of meeting at a restaurant. Bored and feeling the urge to shop? Try reading a book, going for a walk, or doing something creative.

I’ve found the most inspiration from fellow bloggers:

• Instead of completely redecorating a room, try a bit of wallpaper and a fresh coat of paint.
• Rather than buying new furniture, consider how a few yards of fabric might breathe new life into the furniture you already own.
• Hate the fit of a dress, but love the fabric? Consider a refashion.
• Overwhelmed by the expense of baby gear? Find frugal ways to make it yourself.

A quick Google search usually provides new solutions I might not have thought of on my own.

Do nothing
Just ignore the need and try to do without. A lot of times if you simply do nothing, you find it’s not as bad as you thought. The best personal example of this was our decision to do nothing about replacing our second car. We also do this when we’re swept off our feet by fancy kitchen gear, and then realize that our cast iron Dutch oven may not be as gorgeous as a porcelain enamel Le Creuset, but it gets the job done.

Make a habit out of questioning your purchases, and try a quick Internet search to see if there’s a less expensive solution out there.

What about you? What have you done lately to improvise, get by with what you have, or find a cheap solution, instead of buying something new? Share your tips!

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Related Articles at Get Rich Slowly:

• Alternatives to Buying New
• Budget Spreadsheet Corrections
• Confessions of a Car Salesman
• links for 2007-05-30
• One Uncle’s Advice About Money

This is a guest post from Andy Jolls, founder of VideoCreditScore.com. Andy ran the myFICO.com business for a number of years and now educates consumers with free credit videos. You can follow him on Twitter at @vidcredit.

My wife and I were married a few years ago. I was working at myFICO at the time we got engaged, so I was already swimming in the world of credit, debt, and personal finance.

In fact, Suze Orman was a partner of myFICO, so I was exposed to a lot of her principles. For example, she believes that all couples should go through the prenuptial agreement process, which seems like heresy to most of her viewers. The “pre-nup” has negative connotations for most people, but Orman has a different spin on it — which I adopted.

Her concept is that a pre-nup doesn’t need to be focused on a negative outcome of divorce. Instead, it can be used as an exercise to really talk about money, and especially values around money. Her thinking is that if a couple can get through a pre-nup, they’ll be better equipped to handle financial issues down the road. Orman believes that every couple should have a pre-nup, and that it isn’t a tool just for wealthy people.

So, Molly and I decided to do a pre-nup. We told friends that we intended to do a pre-nup and the reactions were, perhaps, unsurprising. Most looked at me with disdain, as if it were something I was forcing her to do. But we held firm because we knew the data: 80% of all divorces are related to money issues. Over half of credit distress issues come from an estranged spouse.

Honestly, the process was awkward at times. But mostly, it was a healthy discussion about goals, fairness, and respect. It was a chance for each of us to show each our true character. I learned what was important to Molly, and she learned what was important to me.

To be frugal, we had a lawyer friend draft up the standard documents, and then we each hired an attorney to make sure we were covering all the bases.

To those of you who say, “I don’t need a pre-nup to have great communication with my spouse!”, I say this: There’s a value you can’t see until you go through it. You are forced to show more of who you really are, and it’s hard to force that in the courting stage.

In the end, the process was cathartic. Now our money discussions don’t involve communication issues. Don’t get me wrong: Like most couples, we have disagreements about how to spend money! But we feel great about the transparency the pre-nup provided, and the fact that it’s made us better communicators.

Do you have experience with a pre-nuptial agreement? How do you feel about the process? Would you recommend it to others?

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