How should we balance frugality with social/environmental responsibility?
Over the last two years, I’ve reviewed in detail more than a hundred (actually approaching two hundred) personal finance and personal productivity books on The Simple Dollar - for more than a year, I reviewed two a week. Over that time, many readers have asked me what I’m doing with all of those books. Some came from the library, a few were review copies, and some were gifts, but surely I had to be building up quite a library, right?
Prior to our financial meltdown, my wife and I simply never sat down and talked about our finances. Right after our meltdown, we talked about things almost every day, but through our recovery, our discussions have slowly reduced themselves to the point where we’re effectively already having monthly family financial meetings.
And these meetings have become a big part of the financial glue of our marriage.
Over the last few weeks, several readers have written in asking me what I’m going to do with my economic stimulus check, perhaps in hopes that it would give them some idea as to what to do with it. I thought that walking through my plans for the money might give some people insight into how I make my financial decisions.
Here’s my family’s exact plan for the $1,800 we’ll soon be receiving: every single dime of it is going towards my wife’s student loan.
A number of people have asked me how I’m saving for retirement now that I’m self-employed, and several more asked yesterday when I mentioned that I was signing up for a SEP-IRA. In order to clarify everything, here’s exactly how I’m saving for retirement as a self-employed writer.
For comparison’s sake, my previous retirement savings were exclusively in 403(b) and 401(k) plans.
I often write about how a person can save a few dollars here and a few dollars there by making a few little changes in their life. For some of my readers, this seems pointless, and they’re quite happy to tell me so. “Why bother saving $3?” they’ll ask.
Over the last month or two, I’ve really begun to understand the reasons for frugality: those little choices snowball into something big over time. Let me show you exactly how it works.
At some point, as a relationship grows and becomes more serious between two people, questions begin to arise about long-term plans, particularly as it begins to become clear that at least a significant portion of two lives are going to overlap and become one.
For my wife and I, these discussions started about a year before our wedding. We just talked casually about things, such as merging checking accounts and saving a lot in our supplemental retirement plans. We mused about kids a bit, with a general consensus of waiting for a least a year after our wedding.
I have a lot of fun following individual stocks in my spare time. I keep tabs on a small handful of companies that I have a personal interest in - Apple, Nintendo, Herman Miller, and Ford, namely. I watch for news articles on the company, read their annual and quarterly reports, and stay up to date on pretty much everything about the organizations.
One of the most frequent negative comments I get on The Simple Dollar relates to credit card usage. I often advocate using credit cards for their purchasing convenience and rewards points, then paying off the whole balance each month. In effect, this means that I use a credit card as an extension of my checking account, albeit one that earns rewards for me. Over the course of the last six months using this strategy, I’ve earned about $500 in car rebates using my Citi Driver’s Edge card - and I’m carrying no balance at all. That $500 will go toward the purchase of a new car in the future.