This is a guest post from MLR at My Life ROI. If you like this post, check out his website or subscribe to his feed.

One thing I love about reading Get Rich Slowly is that J.D. is always willing to get his hands dirty and throw on a different hat. J.D. is a do-it-yourselfer. From writing monthly updates on his garden progress to giving instructions on how to make homemade pumpkin butter and muffins, J.D. does it all! One DIY post caught my eye in particular, though.

J.D. mentioned that the best way to save money on home repairs is regular maintenance. He mentions in the article that he met with a series of contractors to get quotes on things he did not want to do, like painting the house. The point was not that he met with a bunch of contractors — it was that there is a lot of value behind regular maintenance.

J.D. did a good job making that point, so I would like to emphasize the other half of the equation: the value of getting a lot of estimates.

My parents’ situation
Now, my parents are a lot older than J.D. and not as able-bodied. Maybe once upon a time they were, but they are not DIYers anymore. They recently decided they needed a lot of work done on their house. What did they need done?

• Back deck — Our back deck was in slight disrepair. Back when I was in high school and college, I would do what I could to help keep the house up and running. I actually paid my way through college by running an exterior painting company. So with that skill set came the familial duty of power washing, scraping, sanding, caulking, glazing, priming, staining, sealing, and painting different parts of the house. One thing I never got really good at was wood replacement and wood repair. I normally subcontracted that kind of work out when I was running my company. A bunch of the slats and fencing were rotted on their deck. Underneath the deck, a few of the support beams were also starting to rot. Seems they had termites. On top of that they had a storage shed right next to the deck which was getting decrepit and was only storing old lawn chairs and Halloween decorations. Phew! Lots of work!
• Carpeting (full house) — My parents moved into their current residence in 1988, a full 21 years ago. The wall-to-wall carpets have not been changed since then. They made do with what they had and would steam clean them to keep them looking nice enough. But now that the economy is tumbling, they decided they would be able to find some good quotes on carpet replacement. The catch? They didn’t want to move any of the furniture, so any quote would need to include moving the furniture from the room, and putting it back after replacement.
• Kitchen Revamp — Similar to the carpets, the countertops and cabinets have been the same for the past 21 years. I stripped the wallpaper and painted the walls and cabinets about five or six years ago. The appliances have been replaced because of wear and tear. Other than that, nothing has really been changed in the kitchen. So my parents wanted a quote on completely tearing out and replacing the countertops and the back wall, repainting the walls, changing the cabinet hardware, repainting the cabinets, and tearing up and re-tiling the floor.

So there we have it: three huge jobs that my parents wanted done in the middle of an economic recession. Good thing they’ve saved money for opportunities like these.

A kitchen in need of a remodel — but not the kitchen in this article.

Getting the Estimates
My parents went through the normal routine in order to get estimates. They called people from the phonebook, they looked at the local classified advertisements for services, and they asked some neighbors for referrals. When all was said and done, how much were the estimates?

• Back deck — The highest estimate they received for the back deck was about $10,000. They had a few other estimates ranging from $7,500 to $8,800. The highest estimate they received was also the first estimate they received. If this isn’t a testament to getting multiple estimates, I don’t know what is. But they did not sign with the contractor who gave a $7,500 estimate…it gets better!
• Carpeting (full house) — Estimates for the full carpeting job were as high as $6,500 and stayed in the range of $5,500 through $6,500. Why? Each contractor stated that the estimate was a lot higher due to the request that they be responsible for moving the furniture. Understandable…that is a lot more work than they were probably expecting. But my parents did not sign with the $5,500 estimate.
• Kitchen revamp — For the kitchen work my parents also got an estimate from a Home Depot-certified contractor on top of the other contractors that came in. The top estimate wound up being $3,800 and the lowest was $2,900. Surprisingly the Home Depot contractors were in the middle.

Once my parents got all of their estimates, they figured that the maximum they would spend would be about $20,300 by choosing all of the highest estimates. If they chose all of the lowest estimates they would spend about $15,900. Not too shabby…that is a $4,400 cost savings, or 21% off!

But Wait…ONE More Estimate
My parents were ready to go ahead and spearhead all three projects by going with the three lowest estimates. However, I would like to point out that they called the references for all of the lower estimates and all of them checked out as doing excellent work. I would never advocate just going with the lowest estimate to save money as you could wind up having to do a lot of “cleanup” work down the road. They asked me why there would be such a disparity, and in my experience from working in the industry, it is very whimsical.

Luckily for my parents, though, they decided to not squeeze the trigger yet. They knew the neighbor across the street was a big time DIYer. Over the years we have watched him build his front porch, repave his driveway, build an in-ground pool, build a two level deck in the backyard around the pool, cut down trees, plant trees, build a shed, repair his foundation, replace sections of his roof, etc. I said J.D. does a lot… but compared to our neighbor I would venture to guess J.D. is an amateur! [J.D.'s note: There's no question I'm an amateur. Very much so!] What line of work is our neighbor involved in? He is a high school teacher.

My parents decided to talk to him just to see if the prices were in line with the amount of work that was involved. They figured that he, of all people, would know how much time and equipment these three jobs would require. When they asked him they got a much better response than they imagined.

• Back deck — For the back deck he offered to do the job for $1,200, materials included, as long as he could spread the work out over a few weekends. He would also put a few more support beams in to be safe. Potential savings = $8,800 off of the highest estimate and $6,300 off of the lowest estimate.
• Carpeting (full house) — He didn’t offer to do this work. However, he did have a licensed contractor he has worked with before that came out and did an estimate. Their estimate? $3,800! After checking their references my parents found out they passed with flying colors. Potential savings = $2,700 off of the highest estimate and $1,700 off of the lowest estimate.
• Kitchen revamp — The neighbor offered the same deal as on the back deck. He would do the job for $1,200, materials included, as long as he could do it over a long weekend, like a Friday to Monday. Potential savings = $2,600 off of the highest estimate and $1,700 off of the lowest estimate.

They weren’t expecting this at all so it came as a very pleasant surprise. It also goes to show you that you can save thousands in places where you would least expect to look.

By talking to this neighbor they wound up paying him $2,400 for two of the jobs and $3,800 to the contractor he recommended for a total of $6,200. They saved anywhere from between $9,700 (61% off of the lowest estimates which were already 21% off of the high estimates!) and $14,100 (69% off of the highest estimates).

Applicable?
Is this anecdote applicable in your own life? Absolutely! Do you ever see one of your neighbors doing a lot of DIY work? When you talk to them do they talk about all of the weekend projects they have lined up for themselves? If so, would it hurt to ask them if they would be willing to do some side work for extra cash? If not, do they know anyone who would be looking for work?

As long as you are willing to be flexible with the schedule (as my parents were in letting the neighbor do the back deck work over the course of a few weekends), you may find a few thousand dollars in your bank account when all the work has been completed.

If you can’t find a DIYer in your neighborhood at least make sure to ask around for references from your neighbors and get multiple estimates done. If you can’t save roughly $14,000 like my parents did you might be able to save the $4,400 (21%) they were about to “settle” for.

As the weather keeps getting nicer, good luck getting your home maintenance projects completed!

J.D.’s note: Kris and I have had a LOT of work done on our house over the past five years, and I want to echo some of the things MLR has mentioned. Namely, the lowest bid is not always the best option. It’s very important to take into account references and your rapport with the contractor.

We have friends that always take the lowest bid and are then angry that things go wrong. Kris and I sometimes take the lowest bid, but sometimes we take the highest. It all depends on how well we think the contractor understands our objectives and on our assessment of his work. But would we ever hire a DIYer from the neighborhood? I guess it depends on how good her work was on her own place.

Kitchen photo by Yew Tree House. Deck photo by DNA Michaud.

I’m in the process of consolidating all of my investment accounts at Fidelity. This isn’t because I think Fidelity is “the best”, but because I think they’re good and they’re certainly convenient. There’s a Fidelity “investor center” not far from my home. (In other words: I’m not endorsing Fidelity; I’m merely following my own advice to pick a good option instead of spending forever looking for the best.)

As I gather my various accounts under one roof, I’m also trying to set investment goals and to implement an asset allocation based on these goals. As I do this, though, I’m struggling with some emotional stuff. I’ve found that it’s one thing to write about smart investing, but it’s another thing to actually do it.

I’ve just learned a real-life lesson about market timing, for example. In general, short-term market timing doesn’t work — especially for amateur investors. If I asked you to tell me whether the stock market (or an individual stock) will rise or fall next Monday, you’d only be guessing. Investors shouldn’t make decisions based on guesses. Or wishful thinking.

Let me give you an example. I recently decided to sell a large stake in an S&P 500 index fund. In order to get my asset allocation correct, I wanted to transfer the money to bonds. But when it actually came time to sell the mutual fund, I couldn’t pull the trigger.

“What if it goes up?” I kept thinking. The market has been climbing over the past few months, and the fund was up 35% since March. 35%!! That’s a pretty good increase, but I wanted more. “Maybe I should wait until the market goes up another three or four percent,” I thought.

I held the index fund for an extra day. Then two. Then three. Each day, the market went down — and my fund followed with it.

“Ouch,” I thought. “I should have sold!” My fund had dropped 5% from the day I first decided to make the move. ”I guess I’d better just sell. Now I’m losing money that I could have safely on the bond side of my portfolio.”

So I sold.

That was early this week. As soon as I sold, the the market began to rise again. Up half a percent on one day, and the next, and then two percent yesterday.

“Holy cats!” I thought. “It’s up three percent since I sold it. I should have held on!”

This, my friends, is the problem with market timing. You can’t know what the market is going to do from day-to-day. Over the long term, the stock market has returned an average of about 10% per year. But that’s the long term. Over shorter spans, the market is volatile. It swings up and down. Over a period of days, its movements are basically random, unpredictable.

I made the decision to sell on June 12th, but I didn’t pull the trigger until June 22nd. In those ten days, my fund lost over 5% of its value. Now, in the three days since I’ve sold the fund, it’s risen 3%. Obviously, I managed to just about nail a worst-case scenario.

Market timing doesn’t always yield such poor results. But, in general, you’re better off basing decisions on your long-term goals and the market’s broad performance instead of trying to guess what your stock or mutual fund will do tomorrow.

It’s been a long time since I pimped my fitness blog, Get Fit Slowly. To be honest, I haven’t been writing there very much. I’ve been busy with this site. But I’m sort of proud and amused by the righteous indignation I mustered in my latest post: “Walk off 15 lbs by July 4!”. It’s been a long time since something got me that worked up.

In the world of personal finance, here are some of my favorite recent articles from around the web:

First, Trent at The Simple Dollar posted an interesting article yesterday about the relationship between money and power. One of Trent’s readers writes that people don’t want to be rich so they can buy stuff; they want to be rich so they can have power. “Money does not result in influence and respect — instead, influence and respect often lead to money,” Trent argues. “Built respect and influence first.” I agree with him, but I don’t think that addresses the question. There’s a difference between “respect and influence” and power. I’ve seen that money can and does buy power, even if it doesn’t buy respect.

At U.S. News & World Report, Kimberly Palmer recently interviewed Suze Orman about the economic crisis. Orman makes some interesting points. Here’s one exchange:

Palmer: Do you think young people have it worse than any other generation, with their higher unemployment rate, high debt levels, and weak job market for graduates?

Orman: Right now, they have it so great it’s not even funny. If the economy kept running the way it was, you guys would have been broke for the rest of your life. Real estate was going up and up. You would never have qualified for real estate, and companies were shipping jobs offshore. So where were you going to get a job? The price of tuition was so high [that graduates] owed $150,000 in student loans. The price of milk and other prices were so off the charts. What were you people going to do? The stock market was at 14,000, so every time you put money into your 401(k), you bought [fewer and fewer] shares.

Finally, NCN over at No Credit Needed has some advice on breaking bad habits. He has a list of things to try if you find that you make a lot of impulse purchase. Solid advice.

The hardest part of money management is just getting started. Once you have some momentum, it’s easier to make the right choices. Kay has been reading personal finance blogs for almost a year now, and she knows that she needs to make some changes, but she doesn’t know how to begin. She writes:

I want to get serious about being good with my money, but I don’t know where to start. I never developed good financial habits, and now I’m paying for it. I was married to a man who was also bad with money, and I’ve only been on my own for six years, but I continued those same bad habits. I’m 39, have no savings and about $28,000 in debt.

Next May, I will lose half of my child support when my son graduates from high school, and the rest the following May when my daughter graduates. Because of that, I feel like I should focus on getting rid of the debt, so I have less money going out. But if I don’t have emergency savings, then there’s no way to keep from incurring more debt. Of course, I don’t have any money saved for retirement, etc., which is another worry.

Basically, I have a list full of high-priority financial needs, but trying to do everything at once is going to get me exactly nowhere. (I know, because I’ve been trying and failing since last summer!) I did cut up my credit cards, but that’s about as far as I’ve got. Help!

It’s tough to get started because it seems like there’s too many things to do. Which choice is best? Should Kay eliminate debt first? Save for retirement? Build her savings?

Here’s the secret: There’s no one right answer. Some choices are better than others, it’s true, but the best way to take control of your finances is to do something. Action beats inaction. Taking any step in the right direction will help Kay move closer to financial stability.

All the same, some options may be better than others. As important as I think retirement savings is, I wouldn’t start there. Better to get the now under control first and then worry about the future. In Kay’s position, I would focus on three things:

Reduce expenses
Kay doesn’t mention what her expenses are, but if she’s like most people, she’s probably spending more than she needs in a variety of ways. When I was getting out of debt, I found that cutting expenses one at a time helped to create a better cash flow, giving me some breathing room.

I didn’t try to slash everything, but picked one expense after another. I:

• Reduced my cable bill.
• Cut my landline
• Canceled magazine subscriptions.
• Put myself on a budget for books and dining out.

Each of us spends differently. When you decide to get your finances under control, you need to examine your own spending patterns to find the areas you can cut. Focus on one item. Once you’ve trimmed that, look for another. This gets easier with time.

Build savings
As Kay boosts her cash flow by cutting expenses, she should use this extra money to save. Even when you’re struggling with money, it’s vital to set aside for future emergencies. If you can only afford to save $25 per month, then save $25. If you can afford to save $100, then save $100. Just get in the habit.

For many people, the best way to learn to save is by making the process automatic. I also found it necessary to create barriers so that it wasn’t possible to withdraw this money on a whim. In both cases, I recommend opening a savings account at a different bank from where you hold your regular checking account.

In my case, that meant opening a savings account at an online bank. I used ING Direct, but there are many other excellent options. It doesn’t matter which one you choose. Don’t overthink it; you can always change your mind later. Create a link between your existing checking account and your new online savings account. Set the new account to pull $20 or $50 or $100 a month automatically. Treat this like any other bill. Use this money for emergencies only.

Tackle debt
After reducing expenses and building an emergency fund of $500 or $1000, the third step is to make a plan for tackling debt. For me, that meant drafting a spending plan:

My spending plan prioritized my debts and helped me allocate future raises and bonuses. Your plan will be different. It might be more elaborate or less elaborate than mine. The important thing is to establish one.

If you’re struggling with debt, I highly recommend Dave Ramsey’s debt snowball strategy. Here’s how it works:

1. Order your debts from lowest balance to highest balance.
2. Designate a certain amount of money to pay toward debts each month.
3. Pay the minimum payment on all debts except the one with the lowest balance.
4. Throw every other penny at the debt with the lowest balance.
5. When that debt is gone, do not alter the monthly amount used to pay debts, but throw all you can at the debt with the next-lowest balance.

Because it emphasizes paying down low-balance debt as quickly as possible, the debt snowball provides quick wins. Those who’ve never been in debt frown at this strategy because it costs a little more than starting with high-interest debt. But as somebody who fought debt demons in the past, I’m here to say that the psychological boost from the debt snowball is worth the extra pennies.

Conclusion
If, like Kay, you’re struggling to get started with smart money management, then break the task into smaller pieces. Don’t let yourself be overwhelmed. Reduce expenses, build savings, and tackle debt. Yes, it’s important to save for retirement. But I believe that you need to start with the basics, to staunch the bleeding and heal the wounds before you begin gathering strength to face tomorrow.

In other words, don’t worry about a Roth IRA or a 401(k) at the beginning. Focus on building a strong financial foundation so that you can meet the needs of today — and next year. Once you’ve accomplished this, attack retirement savings with vigor.

What advice can you offer Kay? How did you get things turned around? What were your first steps?

For more on this subject, check out my recent article about where we’re starting from. Photo by Jurassic Jim.

“Don’t you have any tips for single folks?” I’m often asked. Like any writer, I tend to write from my own experience — that of a married man. Fortunately, there are plenty of single people in the GRS community who are willing to share the things they’ve learned. Here’s a guest post from Kinley Levack about how she and her sister hold each other financially accountable.

Over Christmas 2007, my sister Michelle and I started chatting about our finances. We had independently come to the same conclusion: we each needed to get our act together. We decided that beginning 01 January 2008, we would help each other move in the right direction.

Sharing accounts and goals
We started by baring it all. We both made lists of our debts, accounts, etc. I had already spent about two years knocking down a credit card balance that had crept up to nearly $6,000. But I had virtually nothing in the way of savings, and had only recently begun contributing to a 401(k).

Michelle’s goals were primarily related to debt reduction. She had accumulated a couple of store credit cards that she wanted to pay off, as well as an outstanding amount due for a class at a local university. She had fairly limited savings.

We each created a document listing:

• The amounts we contributed to our savings and investment accounts each month
• The amounts paid toward debts each month
• Our monthly goals
• Our major expenses each month
• And so on…

A simple Microsoft Word document with a page-per-month view worked best for me.

Performing a monthly review
At the beginning of each month, we send updates to each other with that month’s set of goals, the most up-to-date figures for each account, and a quick recap of how we did with the previous month’s goals. My updates are never more than one page in Microsoft Word. They take about 20 minutes or so to pull together.

Some goals are very specific. One of my goals in January 2008 was to increase my 401(k) contribution from 3% to 6%. But other goals are more vague. Michelle noticed that her Starbucks spending was getting out of control, for example, so she worked to be more aware of what she was spending there.

Each January, we also develop year-long goals.

Over the past 18 months, Michelle has nearly paid off all of her debts. (She has a little left on her primary credit card.) She has also substantially increased her savings, and in the past five months alone has raised her credit score nearly 100 points. I have increased my savings to cover almost three months of expenses, fully funded a Roth IRA each year, and set up a holiday fund that I contribute to monthly to cover Christmas expenses. (That seems to be a budget-buster for me every year.)

Providing support!
This has been a great accountability system for both of us. As sisters, we have no problem calling each other out when we think the other one is being irresponsible. But we are also incredibly supportive of each other. We’re both in our twenties, so we have plenty of time before retirement, but we needed to get the ball rolling toward being financially fit.

This partnership also works well because we have similar mindsets about saving and investing; we have a lot that we want to accomplish, but we also want to enjoy ourselves now and have about the same tolerance level for shopping, dining, and travel. I think it’s important to have a counterpart with roughly the same idea about saving versus spending. If one of us was a big shopper and the other super-frugal, we’d probably just irritate each other.

Michelle and I haven’t ever discussed an end point to this system; we just keep learning as much as we can and making bigger goals. We’ll see how it all turns out. So far, so good!

When you have a spouse or partner, you generally have built-in financial support. I think Kinley and her sister have discovered a great way to lend each other support, even while remaining single. Photo by Snippets 101.

During yesterday’s episode of The Personal Finance Hour, Jim and I spoke with Liz Pulliam Weston, financial columnist and credit score expert. Weston provided background on how the credit scoring system works, and offered tips for how to maintain (and improve) your credit score.

During the show, Weston mentioned a past MSN Money article in which she wrote about 8 secret scores that lenders keep. These lesser known (and confidential) scores are also a part of your credit profile:

You’ve heard by now of credit scores, the three-digit numbers lenders use to gauge your creditworthiness. Credit scores predict how likely you are to default on a credit account or loan; they’re used to help set interest rates and terms. What you may not know is that credit scores are just the start of the way financial institutions evaluate you, and they’re not even the most commonly used scores — far from it.

Weston enumerates eight other scores that are used to evaluate you as a borrower:

• Your response score predicts how likely you are to respond to an offer of credit, such as a credit-card offer in the mail.
• Your application score contains secondary information that’s not factored into your credit score. This is like a reinforcing piece of information.
• Your bankruptcy score is just what it sounds like: a measure of how likely you are to declare bankruptcy.
• Your revenue score indicates how much money a lender is likely to make from you as a borrower.
• Your attrition-risk score measures how likely you are to close your account. Lenders use this in combination with other scores to decide whether a customer is worth retaining.
• A behavior score is like a credit score, but applies to only one account. Each account has a behavior score, which reflects how you handle the account.
• A transaction score is generated for each purchase you make, and is used to determine whether the transaction should be approved. (Or whether it might be fraudulent.)
• If any of your accounts is sent to collections, your collection score predicts how likely you’ll be able to pay your debt.

For more detailed information about these “secret” scores, read the entire article at MSN Money. And for more information from Liz Weston about the ins and outs of credit scores, listen to yesterday’s episode of The Personal Finance Hour (also avaialble on iTunes).

When I bought my used Mini Cooper in April, things didn’t go exactly as I’d planned. Part of this was because I hadn’t done enough research. But a lot of it was because the dealer had some tricks up its sleeve and I did not.

At Car and Driver, Jared Gall has compiled a list of car dealer tricks to watch for when buying a vehicle. He says that the following are common practices:

• Juggling the foursquare. The “foursquare” is the worksheet on which the salesperson jots down the terms of the deal. It’s an easy way for her to manipulate one factor (purchase price, down payment, monthly payments, trade-in value) or another.
• Profiting from rebates. Gall warns that salespeople often use the presence of a rebate to manipulate buyer psychology. Don’t let that happen to you.
• Inflating payments. The more you’re willing to pay each month, the more room the salesperson has to work. The article recommends ignoring the question of monthly payments until you’ve negotiated the price of the vehicle.
• Fees and extras. “If it’s anything he offers after you’ve negotiated your sales price, you don’t need it and shouldn’t pay for it.”
• Interest-rate bumping. Gall recommends shopping for your own financing before you shop for a vehicle. He also warns that “it is not uncommon for the dealership to secure financing for you at one APR but offer you a rate one percentage point higher — and then pocket the difference.” Be careful.
• Altering the bill of sale. Some dealers will leave the contract open-ended. Don’t allow this. Don’t sign anything with blanks or undefined terms. Be sure the paperwork is complete before you leave the lot.

Gall says there are several other tricks that dealers use, though these are especially underhanded. “If a dealership pulls any of these stunts on you, it doesn’t deserve your business,” he writes.

• Ransoming your check.
• Eavesdropping.
• Lying about your credit score.
• Misplacing trade-in keys.

For more information on these tricks and how to cope with them, check out the full article at Car and Driver.

The dealer trick that got me isn’t on Gall’s list. When I went to look at my Mini Cooper, I was greeted by a young man who’d only been on the job for two weeks. After I test drove the car, we sat down to negotiate. I talked him down from $17,000 to $15,000 and was very pleased with myself. But then he fetched the “closer”, whose sole task was to talk me up from that $15,000 number. I had essentially told the dealer how much I was willing to pay, and the closer was there to get me to pay more. And I did. I paid $15,600.

The young salesman did a follow-up call a week after I bought the car. He was doing a survey to ask me about my experience. I told him it was fine except that I didn’t like dealing with the closer. I felt like I had been manipulated by him. “Yeah,” he said. “You shouldn’t listen to him. He talks a lot, but he’s full of shit. He wants to sell that car. You had more power in that situation than you think.”

Lesson learned.

Join us this afternoon for the 13th episode of The Personal Finance Hour. Today, Jim and I will be joined by a special guest, money writer Liz Pulliam Weston. Weston, “the most-read personal finance columnist on the Internet”, writes regularly for MSN Money, and is the author of Your Credit Score: Your Money and What’s at Stake.

We would love to have you call with questions and share your own experiences! There are four ways to hear the show. You can listen through an audio feed at the show page, or you can dial the call-in number at (347) 327-9144. You can also listen through this widget:

Note that the widget always holds the archive of the most recent episode. So, right now it contains last week’s episode about earning extra money. Later this afternoon it will contain episode number thirteen.

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 every Monday — 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) every Monday.

I did a little time traveling yesterday, and I didn’t like it.

“I’m going to clean the workshop,” I announced at breakfast. “I know I should write or mow the lawn, but I’m going to clean the workshop.”

“Sounds good,” Kris said. She rarely argues when I have an urge to do some cleaning.

A glimpse at the past
When we first looked at this property five years ago, I was drawn to the outbuildings. I have fond memories of the outbuildings on my grandparents’ land, so I was excited that our new house would have a detached garage, two sheds, and a workshop.

For the first couple of years, I actually used the workshop for its intended purpose. It was the place I practiced my (very limited) handyman skills. I also used it to build computers for family and friends. In time, however, the building fell into disuse; it gradually turned to storage.

I gave a tour of our home to a visitor last month. When I showed the workshop, I was dismayed. I hadn’t really looked at it in months — or years. But when I saw it through the eyes of a stranger, it was clear that it had become a dumping ground for my cast-off Stuff.

The past recaptured
I’ve written before about my battle with Stuff. In many ways, I’ve made great progress. I’m less acquisitive than I used to be, and I’ve sold most of the things that have value. But I still possess a great mass of Stuff.

As I began my cleaning project yesterday, the workshop was packed with:

• Old computer parts (Apple II, Macintosh SE, etc.)
• Vinyl record albums from my youth
• Compact discs
• Darkroom equipment
• Old books and comics
• Stacks and stacks of magazines
• Boxes and bags filled with miscellaneous junk
• Packaging materials from three years of purchases

Looking at this collection of Stuff — none of which I need or use anymore — I was overwhelmed. I felt sick. Did I really purchase all of this Stuff? Why? As I worked, I tried to answer that question.

Whenever I picked something up, I tried to remember how much I had paid for it and what had led me to buy it:

This voice recorder cost $59. I thought it would keep me from forgetting things, but I never remembered to use it. Not once. These photography books cost $20 each. I thought they’d help me make better photos, but I’m not sure I read any of them at all. I bought this old Apple II for $125 off of eBay because I wanted to play the games I remember from fifth and sixth grade. I used it for a couple of hours.

I took a trip through my past, and it wasn’t a pleasant experience. All around me was evidence of my wasteful ways. For nearly 20 years, I had been in acquisition mode. I accumulated Stuff. My workshop was filled with the last remnants of this life.

One fundamental principle of frugality is to buy only things for which you have a use (even if that use is pleasure). The old J.D. wasn’t good at this. I bought a lot of stuff that I didn’t need — and barely wanted.

Now here I am at 40, and when I look at all of the things I own, I can’t help but wonder what my younger self was thinking. Buying this Stuff seemed like a good idea at one time, I know, but owning these things did not make me happy. It didn’t make me feel free. Quite the opposite, in fact. This Stuff is a burden, a physical and a mental barrier to the things that are actually important to me.

A dream of the future
Kris and I are in the very early stages of planning our vacation for next year, and we’re leaning towards a Rick Steves tour. Steves is a one-bag zealot: Participants are not allowed to bring more than a single carry-on suitcase, whether the tour lasts two days — or twenty.

This might seem limiting to some, but I find the one-bag philosophy liberating. When Kris’ parents took us to London and Dublin in 2007, I took a single carry-on bag. For three weeks, my entire world consisted solely of the possessions I could squeeze into this suitcase. It was awesome. I felt unburdened. When we returned from that trip, the one-bag experience prompted me to undergo a short phase during which I purged Stuff around the house — but I never finished the job.

As I continue to develop my personal and financial goals for the future, I want to focus less on Stuff. I’ve learned to guard against the invasion of Stuff, but I want to take it a step further. I want to eliminate more of the Stuff I already own. To that end, I’ve developed some personal guidelines to help me approach the task:

• Don’t overthink it. With so much Stuff to get rid of, it’s easy to make the project even better than it has to be. I’m tempted to draw up plans on paper or to simply re-arrange the Stuff into new piles. The key is to dispense with all this folderol and just get started.
• Focus on one item at a time. If I look at the entire project at once, I’m overwhelmed. How on earth will I ever clean the workshop? How will I ever find a place for all this Stuff? Instead, I concentrate on one thing at a time. Where does this photo enlarger go? And what about my old Tintin books? I break the project into smaller steps.
• Don’t get depressed. When I think about the time and money that this Stuff represents, I sometimes let it get me down. It seems like such a waste. But the past is the past, and I cannot change what I’ve done. All I can do is try to make smart choices going forward, to guard against the invasion of Stuff, and to get rid of the clutter that’s already in my life.
• Do some good with the Stuff you have. If I’m going to get rid of things, I might as well make the most of them. Sure, much of the Stuff is going to end up in the trash, but can some of the items be donated to a local thrift store? A school? In my case, I have darkroom equipment that somebody on Craigslist or Freecycle may want. My nephew would probably love the two boxes of model railroad parts I’ve acquired.
• Purge ruthlessly. When I sort through this Stuff, I have to turn off the emotional side of my brain. This can be difficult, but it’s necessary. Do I really need my high school newspapers? All of my old role-playing games? My boxes of common football cards? What about my cassette tapes from high school and college? The financial records for buying our first house in 1993? Everything has some sort of meaning; if I keep it all, I’m going to be buried in clutter.
• Remember how this feels. Though I’m doing much better at avoiding Stuff, I still have my weaknesses. I still bring home too many books. I’m still drawn to “free” stuff by the side of the road. Next week, I plan to attend an enormous neighborhood garage sale, and if I’m not careful, I could come home with even more Stuff. When I’m tempted in the future, I need to remind myself of what it feels like to dig through this crap.

I almost think that this project should make me feel happy and triumphant, not sad and mopey. Look how far I’ve come! Look at the smart choices I’m now able to make! And think of how much less cluttered my life will be once I purge all of this stuff!

I don’t feel triumphant yet, but maybe I’ll get there. For now, I’m hoping that my own experience can serve as an object lesson to others who might be acquisition mode. Buying Stuff (and getting Stuff for free) can seem like fun. It can seem like “winning”. It’s not. Don’t buy things for which you have no use; the value is in the using, not the having.

This is a guest post from Ann Zerkle, a Get Rich Slowly lurker, and the founder of Heroes of Capitalism.

As the daughter of a truck driver and stay-at-home mom, my family lived very frugally (and very happily). As an adult, I see the wisdom in the frugality of my parents. Below are the frugal ideas my father always espoused.

1. Work smart, not hard. My dad believed in hard work. He constantly put in 60 hour work weeks, and somehow still managed to be active at church and in the community. The trick is that Dad never wasted effort. He constantly innovated to keep working smart.
2. Don’t make special trips. Dad understood that cars are big, deceptive, money-sucking machines. He understood that every time he fired up a personal vehicle, money was going down the drain. As a result, it was a family policy not to just run out for an item.
3. “It took me X hours to get that!” Whenever Dad bought something, he thought about it in terms of how many hours of work it took him to earn it. This left him walking away without whatever item he was thinking about buying several times. He often applied this to TV as well. He realized the time suck that TV can become.
4. If you can put off buying it, put it off. My parents never had a car payment. They drove junky cars that they could buy with their savings. Even if the car was going to die in the near future, my dad understood that if he could put off buying a new car for another month that was one more month they had to save and put off paying for tags, registration, new insurance coverage, etc. Sometimes the cars would last way beyond expectations. Right now my dad is driving a 1992 Oldsmobile with 200,000 miles on it. He expected it to die two years ago, but it just keeps on ticking.
5. You have to take a risk sometimes. Now that I’m old enough to care about investing, I’ve learned that my dad took some pretty big (yet calculated) risks as an investor. As a young man he lost money in the stock market because of his risks. He’s changed his risk strategy over his lifetime, but still takes risks. He was really the first one in his family to start investing, so he basically learned from scratch and is continually taking his calculated risks.
6. Don’t be afraid to ask. My dad is not shy. He is never afraid to ask for help. This often took the form of borrowing. We had a large garden growing up, but never owned a tiller. My dad always borrowed one from a neighbor. He would ask his pipefitter friend for plumbing help. Even today he is not shy about asking my husband for computer tips and help. He knows what I have come to know: most people like to help, you just have to have the guts to ask.
7. “That UPS truck just ruined my whole vacation!” My dad has worked for UPS for years. Whenever he was on vacation if one of those iconic brown trucks went by he’d say with a smile, “That UPS truck just ruined my whole vacation.” My dad liked his job, but he understood the need for rest. One can’t go on working 60 hour work weeks without rest. He always took a little of his vacation time just to hang around the house so that he could be ready to keep working later.
8. Invest in yourself and your family. Dad understands that the only thing in this life that really matters is people. Ultimately all of our things can be taken away from us by governments, fires, and mismanagement. As a result, he knew the only sure investment is investing in yourself and your family. He helped all three of his children get through college in various ways. He continually improves himself with books, online research and asking questions. As a lifetime truck-driver he could have stagnated in his personal growth and still made the money he is making, but he chooses to keep improving himself.
9. Let people feel the consequences of their actions. My dad did show grace to his children, but he also understood that we needed to feel the consequences of our actions. Around age nine, every January we had to present him with a yearly budget for our allowances. It included a variety of things like school supplies, clothing, spending money, camp fees, and incidentals. We would negotiate the yearly amounts, and then get that portioned to us on a monthly basis. I remember quite vividly one month my sister ran out of money about a week before allowance day. Instead of giving her money to go out with her friends, he let her stew for a week. I don’t think that happened much after that first incident.
10. Eat to get not-hungry. This may seem like an odd thing to say, but even as a little kid I can remember Dad saying, “We don’t eat to be full; we eat to not be hungry.” It took about 15 years, but I am starting to understand the deep wisdom in this. First, eating to get full is a fast way to become overweight, and being overweight has a whole set of financial ramifications. Secondly, focusing on food is not healthy. People who eat to be full on a regular basis are often consumed (pardon the pun) with food. As Get Rich Slowly has addressed in the past, the food we eat has a whole set of financial ramifications.
11. People come first. The final overriding wisdom my father has imparted to us kids is that people come first. You can see this theme throughout the other parts of this list. My parents have a generous giving plan and believe in putting people first, above the environment, above animals and above material possessions.

Ultimately, my dad found what was important to him in life and put his money where his heart was. As a result of this he lives frugally and is deliberate with his money. This money philosophy was imparted to me at a young age and helps me to live frugally. As a result, my husband and I are getting rich slowly.

What did you learn about money from your parents? What do you hope to teach your children?