This is our third of four recommended New Year’s resolutions that together form the foundation of the Financial Guide to Life personal finance principles. Investing is a big topic that we will cover more thoroughly in the future, but for now let’s explore how easy it can be if you choose. Investing can be as complex or easy as you choose and for most of us, complex does not mean richer. You may not think you have enough money to “invest”, but if you have savings that aren’t buried under the mattress or in the back-yard, then you are investing it. Your emergency fund is likely invested in a low risk/low rewards savings account while most people (and all young people) should have their retirement savings invested in higher risk and reward investments.
There are two types of “saving money”: saving towards a goal which we will discuss here and avoid paying full price which we will discuss as resolution 4. You will never have a shortage of goals to save for whether short-term like a wedding or vacation or long-term like retirement. So let’s discuss how to make these achievable even when you have debts to pay off.
Saving should not be something that may happen if there is any money left over, something that you will get to in the future when you have a chance, or something you promise yourself after the next raise. Saving is not a wish for the future — your future depends upon saving now. You need to take charge of your own future by planning for it now. No one else is going to do this for you. This means setting goals, making plans, and prioritizing savings equal to any of your other “needs” and ahead of your “wants”.
In our last post, we began discussing New Year’s resolutions that can actually change your financial future during the coming year. The Financial Guide to Life deals with managing, saving, investing, and spending your money, so I have recommended four personal finance resolutions that are achievable and can bring you financial security and peace of mind.
Many people make New Year’s resolutions to improve their mental, physical, or financial well-being and rightly so. The new year is the perfect opportunity to focus on a new beginning that can make some aspect of your life better, to focus on your long-term needs as much as your short-term wants, and to set some goals to focus on. But we all know how hard it can be to stay focused and follow through for very long. It’s easy for someone to lecture us about discipline, but practical tips are better. So here is my recommended plan to set realistic financial resolutions, follow some practical tips to make success more likely, and develop a plan for actually achieving them.
We haven’t yet seen simple versions of that cool Dick Tracy watch phone or the Jetson’s TV phone, but the humble telephone has changed dramatically over the past few decades with the breakup of the telephone monopoly, mobile phones, smartphones, internet calling, and VOIP phones. T-Mobile and Sprint has injected some competition into the cost of smartphones, but they can still be expensive for both the phone and monthly plan. The best way to save is to skip the latest models and buy the prior model. Save even more with a refurbished phone. Speaking of mobile phones – it’s hard to use that phrase and “savings” in the same sentence, but here are a few more tips – don’t buy your accessories at your carrier’s store or even website, save at least half by going online and search “your phone model accessories”. Get free texting with services such as TEXTFREE for computers, Android, and iPhones (http://www.pinger.com/content/home.html ).
There are plenty of ways to avoid paying full price on entertainment, especially in big cities. It’s not hard to find local theater, concerts, and sports that are inexpensive – think local little theaters, colleges, high schools, and minor league sports. As always, big cities offer more options, but that doesn’t have to mean expensive. Here is how you can have fun on a budget.
I’m going to devote the next series of blog posts to getting certain types of items for less than full price. Let’s start with something that is great for gifts, growing families, or ourselves. Clothes are an example where it’s possible to get nice discounts even on high end items. Get huge discounts on high end clothes during short, flash sales at websites such as http://www.gilt.com/, http://www.ruelala.com/, and http://www.hautelook.com/. Try on discounted, name-brand clothes at several stores including Ross, Marshalls, TJ Maxx, and of course outlet malls.
What is even better than “saving money”; how about FREE? Let’s rephrase Gordon Gekko’s notion about “greed is good” to “free is good” – and possible. There is nothing like getting something for free, which is why advertisers know the power of the word “FREE!” It gets our attention and rightly so. Food tastes better when free, right? It is possible to get stuff for free when you belong to certain groups or know where to look. You may need to join a group or already belong to one. This category changes regularly so rather than provide you the usual web links, I’m going to give ideas to search for so you can get the latest treats.
Images of couponers can range from penny-pinching to extreme hoarders, but in reality, sensible couponing is one of the easiest ways to avoid paying full price. Your goal is not to see how low you can get your grocery cost or how many boxes or cans you stock in your closet, but to save money by avoiding paying full price. And now it is easier than ever because you find coupons in so many places. Coupons for groceries and personal care items are the most plentiful, but coupons for chain restaurants are easy to get and make dining out more enjoyable when you aren’t paying full price. Look for shopping “passes” for store discounts to make trips to the mall even better. Here are tips to make it easy.
While our frugal mind-set reminds us of the basic rule “avoid paying full price”, we need strategies to make it happen. Thankfully, there are plenty of them for nearly any occasion. Always look for savings opportunities and cheaper alternatives to full price products and services. Here is a summary of key strategies which we will explore more fully in the future.