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Wealth Is a Choice.

The following is a guest post by my blogging buddy, Marie Phillips. Marie blogs at Family Money Values and writes for multiple other personal finance sites. She has just authored her newest eBook – Choose Wealth! Be a Millionaire by Midlife – available on Amazon, Barnes and Nobles and other eBook online retailers.

Each person chooses their own life’s destiny – either on purpose or accidentally. Every day, you make many small choices which, over your lifetime, add up and cause you to become the person you are. Sometimes the choices are deliberate, other times we choose by not choosing.

Some of us are born to privilege, some to poverty. Some of us are born and live in peace and plenty, others deal with conflict and paucity. Some are born into stable and loving families while others lack such support. Whatever our circumstances, we choose.

We either choose to follow the crowds around us or we learn to choose our own paths. We choose to seek out new conditions or stay with the old. We choose to lean into the wind or be buffeted about by it. We choose the life we lead.

If you want a wealthy life, you need to choose to lead that life. You choose what wealth means to you and you choose your own level of wealth.

Many of us start out thinking that wealth means money, power, and control. But in the end, most folks who achieve monetary wealth understand that real wealth means leading a fulfilling life. Of course, the money and the resulting financial security can certainly help you lead that fulfilling life.

Choose Wealth! Be a Millionaire by Midlife is a book to help you make choices that lead to wealth. In it, Marie lays out her own framework for wealth – the one that helped her start making the right wealth choices – the one that helped her end up with more than a million.

Choose Wealth

Here is an excerpt from this new book that shows the power of choice:

“A story of success….and failure.

Here is a real life story (with names changed) about two couples who ended up on very different sides of financial independence. One couple kept themselves from being midlife millionaires, the others allowed themselves to become rich.

Couple 1:

James and Beth were children of the depression. James came from a large family with 17 children and Beth from a small family of 3 children and two adults. Neither of their birth families had wealth, both grew up poor. Both went to private Catholic schools through high school and lived in the city. They married in the 1940′s and shortly started a family. They moved into a large new ranch home in the suburbs and ended up with 4 kids. James pursued his dream of becoming an architect, attending night school for 10 years while working full time. He worked for multiple firms over the course of his career and tried to start his own firm multiple times without success. He retired at age 65 with a small pension.

Beth stayed home with the kids, but worked part time as a secretary when needed (to help support the family when James was trying to start his own firm). They ended up with only $70,000 (adjusted for inflation) in net worth.

Couple 2:

Henry and Rose were also children of the depression. Henry grew up on a farm along with his two brothers. His parents only made it through the 5th grade, but Henry graduated from public high school and went on to study a trade. Rose’s Dad immigrated from Sweden, coming to America steerage class. Rose graduated from public high school too (as did her   sister), but then also took advantage of the free teachers college available in her city. Henry and Rose also married in the 1940s and moved to the outlying suburbs to a small new 4 room frame house. They had 2 kids.

Henry worked for the same company until death at age 65 and spent evenings and weekends dabbling in other interests – inventions, real estate and the stock market.

Rose stayed home with the kids but taught school as a substitute teacher and led the school PTA. In the 1960′s she went back to college and earned a masters degree. She went back to work full time when the kids were in high school.

They traveled extensively, sent both kids through college and helped them out financially to get started in married life.

Henry and Rose ended up with a net worth of over $1,000,000 (adjusted for inflation).

Why the difference?

How did Henry and Rose end up so much more financially secure? How did they choose wealth?

They controlled expenses. Instead of spending money on private tuition, their kids went to public school.   They limited the number of children they had. They used time instead of money by doing things themselves instead of hiring others. They shopped for bargains and didn’t insist on name brand items.

They maximized income. Instead of buying a large home right away, they started small, then bought a second home at bargain rates while renting out the first one to obtain another income stream.

They maximized each partner’s earning power by adding to Rose’s education and earning power and making sure they utilized that power through her career. They kept secure income producing jobs that provided benefits and pensions. In contrast, James chose a career requiring a college degree that didn’t necessarily provide earning power equivalent to the cost of that degree and Beth’s time was ill spent at low paying jobs. Neither were able to make use of pension or retirement plans to their fullest.

Henry and Rose saved and invested to grow their money.

After meeting basic emergency needs, they put their money to work for them – in real estate and in the stock market. They didn’t leave money in low interest bearing bank accounts as James and Beth did.

They lived off current income.

They did not touch invested principal because their lifestyle and current income matched. They did not try to keep up with the Jones.

Small decisions on how money was spent and how it was earned made a large difference over time in the financial outcomes of these two couples.

Given the choice, would you rather be Henry & Rose or James & Beth? Would you rather end up with a million or more in your middle and elder ages or the $70,000 on which James & Beth struggled to live out their mature years?

The Convenience of Credit Card Debt

The following is another post from Lyle, a self-employed guitar instructor, performer, web-designer and blogger. For the past twenty years, he has adopted the tenets of voluntary simplicity to live a thrift shop life and has recently began blogging with these concepts in mind at The Joy of Simple.

If you read my previous guest post, How Being A Credit Card Delinquent Saved Me Thousands of Dollars, you might recall that for more than twenty years I had been happily credit card free…well…at least that’s the way it was until about six months ago when I received a MasterCard in the mail.

Credit Cards

How They Got Me

Normally I don’t fill out credit card applications, but I felt sorry for the woman who was being constantly passed by and ignored by this particular stores’ customers. So when she sheepishly asked if I wouldn’t mind filling out the application for some free doo-hicky, I nodded and signed on the dotted line!

To be honest, I never thought I would even receive the card because while I didn’t have bad credit, I actually have no credit. I found out that little fun fact as I was searching for an apartment to rent four years ago.

How I Mis-Handled It

To make a long story short, I did receive the card and was grateful that the credit limit was only $200.00. I figured this would be a great way to start rebuilding my credit, and really, how bad could I screw up with a limit of only 200 bucks!? Well…I’ll tell you how…by maxing out the card, which didn’t take a lot of effort or time, believe me!

A few dinners out with friends, a couple of trips to the grocery store and voila, a maxed out credit card! And even though the plan was to use the card for emergencies only – yeah right!! – and then pay it off immediately afterwards, that concept really did not go according to plan!

And Again

Funny thing happened though, as I eventually paid off the balance in full, I received a notice not long after that I was entitled to increase my credit limit. All I had to do was call a certain phone number and that would be that!

My first instinct was to decline their offer and run for the hills. Yet, I was curious as to how much they were willing to increase my limit…so I made the call.

Less than a minute later I was now the proud “owner” of a $700.00 credit limit. This was now a little more dangerous – relative to my cash flow – but I figured “Hey, I’m much more in tune with my simple living/frugal side – now more than ever – and I shouldn’t have any problem using the card responsibly and only when needed!”

Less than four months later, my card was nearly maxed out and really, what did I spend it on. A bunch of meals out with friends, a few Blu-Ray DVD’s that were on sale, some groceries when cash was a little tight, and that’s basically it.

Surprisingly, I realized that because of the card, and the fact that I wasn’t taking cash out of my pocket, I was buying more expensive brand name items at the grocery store, along with food items I never really bought before (tub of Ben and Jerry’s anyone!!). And when out at a restaurant, I was spending more than I normally would have if I was paying solely in cash! I mean after all, the surf and turf is only a few bucks more than what I was thinking of ordering in the first place so why not!

What was happening to me!!!???

I’ll tell you what, I was falling into the trap that many, many credit card holders fall into…the trap of convenience and forgetfulness. You obviously don’t forget that your spending money you may or may not have, but when all you have to do is input a PIN and your bill is taken care of, you may forget to parcel some cash away to pay that expense the day after! Do that more than a few times and it begins to add up…fast!

And Again?

Well, thanks to a decent paying web design gig, I was able to pay off the full amount, and wouldn’t ya know it, when my next statement arrived in the mail, there was yet again another notice stating that I could increase my limit if I wanted to! AND I DID!!! Was I crazy!? Possibly! But I was once again curious as to how much they would increase my limit to. A few minutes later I had my answer, $1000.00! And that’s where it is going to stay! No more limit increases for me!

I realize that this is almost second nature for some folk who have one, two, three or more credit cards taking up space in their wallets or purses. But I had been credit card free for so long that it was kind of exciting for me to see how far I could go. It was also a little scary! My previous history with credit cards was not good to say the least, and if they hadn’t taken them away from me, I would have probably had to deal with massive CC debt back in the day.

Well, sad to say, this pattern appears to still reside within me even though I have become a very different person since the 20-ish year old me. It’s kind of like being a chronic gambler where the call of the game is stronger than the will to resist. I actually surprised myself a few times on the amount of money I was adding up on the card and while I wasn’t pleased with my behavior, I kept on doing it. I guess some old habits are really hard to break!

Learning

Thankfully, things are a little different now as I leave my credit card home when I go out so I won’t be tempted to use it. This way, I’ll only spend as much as I am comfortable with spending in actual cash.

Once again, I have adopted a cash only lifestyle and will continue to do so. However, I will use the card every now and then to keep it active. I’ll make sure though that I have the cash on hand to quickly pay off the expenditure the next day so that my balance doesn’t creep up.

To be honest, having a credit card is not all bad if handled responsibly, and the silver lining, at least for me, is that my credit rating seems to be on a positive up-swing. And even though I won’t be looking for a loan, or wanting to apply for a mortgage in my lifetime – yes I know, never say never – at least I’ll have a decent credit rating…which was my intention all along.

So, are you as responsible as you would like to be when it comes to credit cards? Or are they just a dang too convenient when cash flow is kinda tight?  Take care and all the best!

If I Could Write A Letter To Me

The following is a post from Joe Foley, a personal finance blogger  and the author of ‘We Got Outta Debt’, the story of how his family paid off $68,000 in a little over 3 years.  His new book, “Retirement for All Ages” is due out in January.

If you know Country Music, the title refers to someone who looks back at his life at age 17 and wants to give him some advice . In this case, it refers to what I’d like to have read from myself while in my 20’s.   I’m a little (a LOT) past the target reader for this site, being that I recently qualified for AARP.  However, once you survive life this long, you can’t help but pick up a few things along the way.  And what I’d wished I’d known then… well.. that’s what this is about. So please indulge me, as David has allowed me to write this letter to me.. um.. you.

“Retirement?  Me?  I’m only 25.. I’ve got time.”  That was me, Day one of my first real job, when we talked about this thing called a 401k.  The 401k had only been around a few years when I started work (I told you I was old), and if I had paid some attention in my Economics class, I might have been able to realize this “Compound Interest” thing could really help me.  But nope, I skipped that day.. or maybe the whole week..  So, I decided I needed the $35/wk I could put in my 401k for more pressing things. Like food or beer. (mostly beer).

So what’s in this letter to you?  Some things I know are pressing for people your age and some things to look out for from someone who’s been there.

Create a budget.

Does “Budget” sound stifling or restrictive? Go with “Spending Plan” if you prefer. Whatever you call it, devise something where YOU decide what to do with your money. You’re the ‘Boss of your Money’. Knowing what you have coming in and knowing where it needs to go is the basis for your Spending Plan. This is your number 1 priority!  Without a Plan, you can’t figure out how to get where you want to be, or how to get there!

Feel free to use these resources you can use (all Free)

Once you’ve gotten a Spending Plan together, you’ll be able to tackle the rest of your Financial Life.

Student Loan Debt

A recent report shows that the average graduate of 2012 is carrying a Student Loan Debt of $27,000.  Unfortunately, That is still a HUGE amount of debt to start your post-school life off.  Hopefully, you’re carrying LESS than that.. but, regardless of how much you have, all is not lost.

You may be able to reduce or eliminate the repayment of your federal Student Loan.  But, like many things in life, there are some strings attached. According to the Associated Press, ¼ of Graduates may be eligible for loan-forgiveness programs. Your 4 main options are:

  1. Become a public school teacher in a low-income area.

  2. Apply for the Income-Based Repayment Plan.

  3. Get a public service, government or non-profit job.

  4. Join the military

If any of these sound interesting, talk to your Student Loan Provider.

Make no mistake, paying off the Student Loan Debt should be your #1 Priority.  Probably #2 priority as well. I carried my loan with me for 10 years.  And it was ‘only’ $6,000.  I realize that’s the cost of 2 textbooks today, but back then, it was money!

How does this affect Retirement?  Obviously, it decreases how much you can contribute to your 401k.  My recommendation is to focus on the Debt, but also contribute to the 401k.  Remember, time is on your side.  Remember that ‘Compound Interest’?  Here’s what I missed.

When you start your job, or when you read this, is the perfect time to start investing.  As a young investor, time is on your side to having your investments grow.   For example, if you start at age 30 and can contribute $15,000 per year, at 7% return on your investment, you’ll have amassed $1,000,000 by the time you turn 55. Take a look at this spreadsheet for the example. (Feel free to make a copy of it for your own use).

If you have Student Loan Debt, that $15,000 a year is probably too much to contribute, and that’s fine. Just start the contribution.  Play with the numbers in your Spending Plan and the spreadsheet above to see how well you can do. For example, $50 per paycheck ($1,200/yr) at 7% return would give you $16,580 after 10 years.  If you work for a company the matches, all the better!  The point is, start early and let Compound Interest work for you!

Housing

  • I know this is easier said than done, but even though you’re no longer in college, you need to live like you are. With the monstrous Loan Debt you carry, frugality is your friend.

  • If you have a good relationship with your parents, see if you can move in with them. IF you do this, it will save you a ton of money.  Have an exit strategy before asking. You are more likely to get a ‘Yes’ if you say “Mom, Dad, I need to pay off this student loan debt, so I’d like to move in for 1 year to help me pay it off”.  Set a date as both a goal for you and a promise to them.

Food

  • Before you go to the grocery-store make a list of things you need to buy. There are plenty of great apps out there for grocery lists.  We use Our Groceries to allow us to create grocery lists on our phones (iOS/Android) and share them with others. Have a plan of what you are going to cook, what you are going to eat for breakfast and what you have to take with you for a lunch.

  • Do not step into the grocery-store hungry. I guarantee that you will buy things you don’t need if you’re starving.

  • Start drinking your own coffee. Starbucks is nice, but a cup at home is maybe $.50/cup, over the $2.00 for a Regular Venti.

  • Do not buy something you can possibly borrow.  Libraries are another best friend.

Transportation

Depending upon where you live, this could be a tough one. If Mass Transit works for you, use it.  In some areas, like where I live, buses do run, but we have very small routes.

If you need a car, go as cheap as you can until the debts are gone.  Obviously, safety and reliability are important too.  But do you really need a Acura or BMW?

Technology (or “Back when I was your age”)

  • Today, technology is much more ingrained in how we live than when I was just out of college. Cell phones were strictly Science Fiction. Now, I’m not saying get rid of your cell phones.  However, if you aren’t already on your parents plan, see if they will add you onto their plan. It’s a much smaller cost for you.

  • We had an Atari 2600 as a gaming system.  Today, you’ve got a ton of options.  Resist the temptation go buy the latest PS-whatever or X-Box.  Yes, it’s entertainment, but those games can really add up. I’m not suggesting you sit in the dark and read old, borrowed books.  Or play solitaire with cards (yes, the game existed before computers).  I am suggesting that any entertainment be a line item in your Spending Plan.

And this relates to retirement how?

There is  this thing called ‘Social Security’, which I’m sure you’ve read about recently.   As far as our Retirement Planning goes, we’re not figuring Social Security benefits into our plans. Unfortunately, my expectations of Social Security for future generations is grimmer.  And so the planning and savings fall upon you. Science Fiction author Robert Heinlein coined the phrase “TANSTAAFL” which means “There Ain’t No Such Thing As A Free Lunch”.  I’ve always taken that to reinforce that people need to take care of themselves, and not rely on others to bail them out.

My point here is that once you’ve slayed the Student Loan Debt Monster, and begun saving for your retirement, the better off you will be in your retirement years.  It’s not too soon to start saving for retirement.  And if you’re Debt Free, you’ll have so many more options available to you.  Start creating your future today.

If you’ve made it this far in the article, I’d love some input in either the comments below or on my blog.  I’m putting the finishing touches on my next book “Retirement for All Ages” and expect it to be released exclusively on Amazon by the end of January.

If you’d like to be notified when my new book is published, please follow this link to my page where you can let me know!

Your Files Are at Risk – About Cryptolocker

The following is a guest post from BFS reader, Nancy Jones.  She made a mid-life career change into computer technology and system security since she loves all the stuff about it that most people hate.  She also created Grown Up Tech to help everyone learn how to get the most out of their computers and the internet without needing a degree in computer science.

There’s a nasty piece of malware out there called Cryptolocker. You won’t know you’re infected with it until you get the notice that your files are encrypted and if you don’t pay 2 Bitcoin (the value of this can change—read on to find out why) by a certain date, the decryption key will be destroyed, causing you to lose all your files forever.

At this time only Windows operating systems are vulnerable, with this exception: If you are running a Windows installation in Parallels on a Mac, with a shared home folder, you may be vulnerable to losing access to the home folder, which is basically where you live on a mac. So here’s what you need to know to grab a handle on what this is and why it’s so nasty.  Most importantly, how not to get it.  And if you do, how to survive it.

A Very Basic Understanding of Encryption:

Encryption is the process that makes text unreadable to someone who’s not in on the secret. It scrambles the text to such an extent that without the descrambler you’ll never be able to read it. It’s what the “lock” icon means when you go to your bank’s website or when you are shopping online and you go to check out.

Most encryption on the web is done with two “keys”.  One is a public key and the other is a private key, and they work together. No other combination of keys will work with either of those two. When you go to your bank’s website, you see the place where you log in with a username and password. When you hit the “login” button, you use the bank’s public key, which is stored on their server, to encrypt your login information so that if someone intercepts the traffic, all they’ll see is gobbledygook.  It won’t make any sense.  AND it can’t be used to log in, because if someone input what they intercepted, THAT would also get encrypted and end up being even more gobbledygooked. Without that private key at the other end, it IS just gobbledygook. So at the other end, the bank uses their private key, which is stored securely on their server, to decrypt your login credentials.

If you are at a website and see a lock, you’ll also see that the “http” is now “https” which means that a Secure Sockets Layer session has been started, which is another level of encryption added to the session. The original encryption session that was started with the public key/private key transmission (which is called “asymmetric”) now initiates a symmetric session that uses the same key between parties. Nothing that passes between the parties can be read by anyone other than those two parties. What you need to really understand is this: it works because both parties have the key. (Trust me, when I was learning all this, it made my head spin.)

What Cryptolocker Does:

Cryptolocker uses the originator’s (the bad guys) public key to encrypt your personal files. It grabs not only the files on your active hard drive, but if you work with an external hard drive attached to your computer as a standard practice, it will grab those too as well as any mapped network drives. That can make this a devastating infection for small businesses.

Don’t even think about cracking the encryption, either. The keys used in this are the best you can get, the strongest available. The payment demanded is any one of three untraceable methods: Bitcoin, MoneyPak card, or Ukash card. That lessens the chances of these guys getting caught, unless one of them gets very sloppy, and then rats the others out.

If you don’t pay the ransom, the decryption key is destroyed. Remember the part above, where I told you that the public key and the private key work together? Well, they ONLY work together. If the private key is destroyed, you will have zero chance of decrypting your files.

Here’s something else you need to know: if you are using a backup site in the cloud, as soon as you think you might be infected, unplug from the internet and call the human customer service rep at the backup service and let them know right away that you’ve been infected with Cryptolocker.  One cloud backup service has officially stated that this information will put a high priority on your call, and it’s reasonable that others are treating it the same way. By this time, they will already have a plan formulated for dealing with Cryptolocker, but if you let a backup take place after encryption has started, you will not be able to use your backup service to restore your computer.

Prevention is the Best Defense:

All indications at this point are that the infections are started with a phishing email. Phishing is just like fishing—someone’s putting some bait out there hoping someone will bite. These guys are not amateurs.  The emails will look like the real thing. Some documented cases so far include emails that look like Amazon, BestBuy, WalMart, and other shopping sites.  Don’t even think that all links in all other email messages from all other sources must be safe just because I didn’t name any others.  You should treat all emails containing links with a strong degree of suspicion.

It is getting to the point where is just is not safe to click on a link in an email anymore.

Other possible infection sources include attachments in emails (if you weren’t expecting it, don’t click on it!).  If your machine has been previously compromised, the attackers could just remotely run a program that automatically loads and runs the encryption software.

Documentation on the attachment version includes emails that look like they came from well-known companies like UPS, Fed-Ex, DHL, etc.  And with shopping online being so popular, we can expect that this will pickup, and with Christmas gift returns and all, don’t expect it to go away quickly. The attachments included in the email will have names that look like they end with .pdf, .doc, .xls, BUT are actually executables, meaning that when you click on them, a program will run. For some reason, Windows, by default, does not display the file extensions, and you generally know what kind of file something is by the icon it displays.

It’s better not to take that chance, you can follow this link (http://support.microsoft.com/kb/865219) for instructions on how to display all file extensions, so that you can actually see if something is not a .pdf, .doc, or .xls but is actually a .pdf.exe, or a .doc.exe, or a .xls.exe. Those are bad guys.  Do not open them. (By the way, this is a ploy used by a lot of other trojans as well, disguising an executable file as a non-executable file; taking the step of displaying file extensions can keep you from clicking on them even in the absence of the Cryptolocker threat.)

And above all, BACKUP, BACKUP, BACKUP!!!!! You should NEVER have only one copy of your critical data. Ever. Ever! Got that? Because if you have a current backup, you’re prepared for….

Surviving the Infection You Couldn’t Stop in Time:

Go ahead and decide, right now, if you are willing to pay the ransom. If so, set aside $300 at a minimum, and be prepared for that to go up. But remember that we are talking about people who already don’t care that they don’t have a right to do stuff to your computer. Counting on them to keep their word may not be wise.

If you don’t intend to reward criminals for bad behavior (yes, I am being clear which path I recommend), stop all your other computer activity TODAY and make a set of recovery disks. That is a disk or a set of disks that contains your computer’s operating system and installed programs as it looks at the moment the disks are made, and all the files. This is a good practice anyway, especially if your machine didn’t come with operating system installation media. Most don’t nowadays.

You may (or may not—it just depends on factors we haven’t figured out yet) have to activate Windows again after installation, and that may require a phone call. I’ve had to do this numerous times, and it’s not a difficult process. The phone instructions are very easy to follow, and when you are asked how many machines the software is installed on, the correct answer is “zero.” Remember that.  Once the operating system is restored, move the most recent backups of your files back into place and you’re ready to go.

Forewarned is forearmed. Now you know there’s bad stuff out there. More importantly, you know how not to get tricked, and you know how to recover if you do get tricked. Don’t be embarrassed if you get fooled, these guys are highly skilled at what they do. They count on you being trusting, and they count on you being too busy to take proper preventive measures. The time you spend in prevention and precaution will save you a lot of recovery time.

There is just a bit of good news post-infection. A security researcher whom I trust completely has confirmed that upon payment of the ransom, the decryption key was provided as agreed, and following decryption the computer was back to normal. This nasty software encrypts only FILES, not the whole disk, not that that’s any comfort, except that the decryption process is far less time consuming for this than for a whole-disk decryption process.

Lastly, more about the payment price—the demand is in Bitcoin, and the value of Bitcoin is extremely volatile right now. When I first started outlining this post, two Bitcoin was about $300.  A year ago it was $13/coin. As of 1/16/14 it’s about $800 each. So “your mileage may vary.” Best to do the backups and not play their game.

Have you heard of Cryptolocker?  Have you ever had to go through this?

4 Ways to Travel for Mind-Bogglingly Cheap Prices

This is a guest post from my friend Paula Pant, who writes the blog Afford Anything, which is dedicated to adventure, traveling, and maximizing life. Check out her posts on How to Travel for a Living and Money Doesn’t Buy Stuff, It Buys Choices.

Travel Cheap

Is it freezing cold outside? Are you feeling antsy to get away?  I know, I know.

When it’s negative 16 degrees outside, you probably dream about a beach vacation. Unless you’re a snow-lover, in which case you dream about a ski vacation. Or maybe, since it’s the holidays, you dream of visiting friends or family living across the country.

No matter where you want to travel, there’s a good chance that you’ve got some destination in mind. But you might be afraid that travel is too expensive.  Don’t worry. I’ve got great news: Travel can be a lot cheaper than you anticipate.

You just need to learn how to travel cheap on a shoestring.

****

A couple years ago, some friends and I drove down to Florida for a one-week beach vacation.

Total cost: $260 per person. That includes everything – gasoline, renting a house for a week, plus food and entertainment.

Why was it so cheap? Because we used the following four cost-cutting methods that I’m going to share below.

Anyone – including you – can use these tactics, regardless of whether you want to visit the mountains, beach, city, or anyone else.

#1: Travel During Shoulder Season

Almost everyone travels during a few peak weeks of the year: Around Christmas, New Years, Memorial Day, Labor Day, and the summertime when children are out of school.

Be different.

Travel during the “shoulder season” – late spring (before kids go on summer break) or early fall (after kids go back to school.) You’ll save a bundle on transportation and hotels, since few others are traveling at this time.

What if you have kids? Ask their teachers if you can pull them out for a Friday and a Monday. You might not be able to take a full-week trip with them, but if they can manage to miss two days of school, you can take them on a four-day trip.

Make that trip educational: teach them about the geography and history of the place that you’re visiting. Think of it as taking an unofficial “field trip” – one that they’ll remember for years to come.

Traveling for the holidays? Look for flights on Christmas Day. Few people want to travel that day, so you’ll often find solid deals.

#2: Rent a House

Avoid hotels entirely by staying at someone’s house. If you don’t have friends in the area, use websites like AirBnb.com, VRBO.com or HomeAway.com to find vacation rentals at private residences.

Renting a private person’s home is far cheaper than renting a hotel room, and you’ll often get exclusive use of a much larger and more comfortable space. In other words, you’ll enjoy the best of both worlds: nicer accommodation at a lower cost.

Why? Private people aren’t burdened with the overhead that hotels carry. They don’t have advertising budgets, they don’t pay teams of lawyers, bookkeepers and accountants, and they don’t have to issue Quarterly Earnings reports.

Yes, hotels enjoy some economies of scale. But they also have a ton of overhead, and this gets baked into the price.

Furthermore, many private individuals have an extra apartment or home that’s just sitting empty, anyway. If they can collect a little money by renting their vacant home or apartment to a traveler, that’s just a bonus for them.

#3: Cook at Home

Here’s a second benefit to renting a house or apartment, instead of a hotel: You have access to a kitchen. That means you can prepare meals at home.

Sure, you might occasionally choose to splurge at a fancy restaurant. That’s fine.  But you’ll at least have the option to cook meals at home on a “regular” basis, so that the restaurant meal will be a treat, not a daily expense.

#4: Enjoy Free Activities

You know what’s great about traveling to the beach? You don’t need to pay a dime for entertainment. Just being on the beach is enough.

There’s no end to beach entertainment: You can read books, build sandcastles, throw Frisbees, jog, walk, kick soccerballs, play in the waves, make snide comments about the people around you.  (Just kidding. Kinda.)

The same is true for traveling to a big city. In a thriving metropolis like New York, you don’t actually need to patron any stores or restaurants. Simply walking up and down the crowded, colorful streets, or strolling through Central Park, or walking across the Brooklyn Bridge, is entertainment enough. And it’s free.

Ditto for being in the mountains: What can possibly beat a hike, followed by a cup of tea, coffee or wine while gazing out over the peaks?

You don’t need to spend a dime to enjoy your vacation. Regardless of where you go, enjoy the pure pleasure of being there.

No money required.

Budgeting for our First Home and KILLING IT!!!

Hi everybody!  I’m Lindsey from This is How I Roll, which is a lifestyle blog that has a little bit of everything on it. I write anything from reviews to personal stories about my unique lifestyle of being an active and spunky girl in a pink wheelchair. Crystal has graciously allowed me to guest post today to help expand my readers because I’m a fairly new blogger. I hope you visit me soon! Okay, on with today’s post…

Crystal’s Long Sidenote:  I haven’t “known” Lindsey long, but I can tell you that she is persistent, stubborn, and is looking to blog long-term despite that crappy period in the beginning when you don’t have many readers and even fewer commenters.  This woman has been coping with Cerebral Palsy her whole life, but the rigors of blogging is what she gets super worked up about.  That is woman you should visit and read.  Her blog isn’t all about CP- it’s a little of everything with a healthy dose of personal finance (like mine, lol).  But you can tell that her regular ways to deal with hardship make her a lady worth getting to know better.

Our First Home

I have some exciting news to share with you – my husband and I have recently been approved for our home loan!!! We are beyond excited because it is our first home, and we are finally going to be able to stop throwing our money away on overpriced rent. Most importantly, I’ll have a home that is completely accessible for my needs, which is something I’ve never had.

We are moving in the spring, when our lease is up, in order to save money before we move.  As you probably already know, saving money is not an easy feat.  I have to give my husband and I props, though, because we have done a really outstanding job with our budget. How? My husband and I basically live like minimalists and are squirreling away every penny possible! No, here is how we actually have been able to reduce our monthly spending to prepare for our new home.

Budgeting LIKE A BOSS (and yes, this is Crystal picking these sub-headers, lol)

When we first started budgeting, we determined what the absolute necessities were. For example, the rent, renter’s insurance, electricity, car insurance/car maintenance, gas, and so on. Then we determined the things we needed, but were also variable in cost. Let’s take gas, for instance: we can’t control the price of gas, but we can control how much we use the car on the weekends.

After that, we looked at our utility bills and minimized all of those plans as much as possible. To be honest, the only bill that we were able to whittle down was the cable bill–everything else was already at the most minimal price. The only variable utility bill that we have is the electric bill, which we minimize by only having things, like lights, on when they are being used. Unfortunately, that’s pretty much all we can do to lower the electric bill. We haven’t become so desperate to use candles for lighting yet, but ask me again in a few months!  :-)

After determining the cost of our monthly necessities, we figured out that the bulk of our savings would come from lessening our spending on groceries and gas.

Using Credit Cards to Keep Track (we cc users need to stick together, hehehe)

One thing that helps us keep track of our budget is using our credit cards for much of our monthly expenses because the site has a pie chart showing where we’re spending our money.  Also, we get rewards back from using a credit card for our utility bills. By the way, we never carry a balance on our credit cards–there’s nothing that bugs me more than having to pay interest!

With that being said, we use my husband’s credit card to pay for gas, groceries, all other car expenses, electricity, and any other expenses that come up throughout the month. With my credit card we pay for the cable/internet, security alarm, both of our phones, and Netflix. All of these are fixed-rate bills, and combined is around $300.00/month.  Since the expenses we pay for with my credit card are pretty much at a fixed rate, our main mission was to lower my husband’s monthly credit card balance.

His credit card balance would fluctuate anywhere between $1,200.00 and $1,800.00 a month. We were determined to get his statement balance under a thousand dollars, so we could put that money towards savings each month.

Showing My Hubby the Light…

I am thrilled to say that his statement balance was $700.00 last month!!!  We were so excited that our hard work and sacrifices paid off in the end. More than that, however, we should be able to keep the balance this low as long as we keep our budget the same, but we’re expecting some fluctuation.

Our biggest savings came from doing away with eating out and eating fast-food. I have to tell you that this was a big source of conflict between my husband and I because I don’t see the logic in spending so much money on fast-food when the enjoyment of eating it is, at most, ten minutes then you poop it out the next day.

Bearing this in mind, against all of my protests, my husband ate fast-food every day for lunch. His lunches averaged $9.00 a day, so let’s do the math. There’s five days in a work-week, so on average, he spent $45.00 a week on lunch. There’s 52 weeks in a year, so that’s averaging $2,340.00 a year. If he retires when he’s 65 and continued to buy his lunch every day, he would have spent $56,160.00! However, it would probably be a lot more than this because the cost of food will only increase with time.

After seeing this and realizing that he was spending $200.00 a month on lunch, he has seen the “error of his ways” as he puts it. I’m happy to tell you that we have resolved this conflict, and he promises that he will never be so foolish with money again. Like I said, this was a very sensitive subject between us, and I was willing to go to the mat with him on this issue.

Please don’t misunderstand me, though, I think eating fast-food in moderation is fine, but every day, c’mon! With everything said and done, I’m extremely proud of my husband for taking his lunch with him to work every day.

It Can Be Fun

I know this may seem odd, but scaling down the grocery bill has been kind of fun. Maybe it’s because we stay home so much now in order to save money. Whatever the reason, it’s fun because we play “How Low Can We Go” at the grocery store, which is a game we made up where each week, we try to lower the grocery bill more than last week’s balance! Maybe we’re dorks, but it’s actually quite fun and liberating.

Before we started saving for our house, we would spend close to $200 a week on groceries for two people and two cats. Since we have tightened our belts so snugly, our weekly grocery bill has been: $46.05, $70.56, $75.57, $77.68, $67.63! We feel like such champions when we’re in the check-out line every week.

We have been able to lower our bill so drastically by planning our meals out for the week, only buying what we absolutely need instead of buying what we’re running low on, buying the generic brands or less expensive brands, and using in-store coupons. Our two cats are even sacrificing by eating a cheaper brand cat food! Hey, they’re getting a new house, too, so they have to suffer right along with us in the meantime!

Pausing on the Extras

Other than all of that, we don’t do any extraneous spending, we only eat at home, and we minimize our fuel consumption by being home bodies on the weekends. One other thing that’s kind of extreme is that we’ve decided not to exchange gifts for Christmas, our anniversary, and birthdays until we get the house. We feel as though the house will be our belated gift for all of those things this spring!

To everyone on a similar extreme budget, just remember to keep focused on the end result. All of the hard work and sacrifices will be worth it in the end! If you have any other suggestions on how to save money, please let me know. I love hearing from you, and I will take all the help I can get right now!  :-)

I will be doing some more detailed posts on how I’m saving money on food and personal care items on my blog soon.  I hope to see you over on This is How I Roll; thanks again for letting me guest post, Crystal!

Financial Mistakes I’ve Made Over The Years

The following is a guest post from Martin of Studenomics, where he helps out with launching something now so that you don’t waste any time in your 20s.

I’ve seen all kinds of shows on TV about strange addictions and odd issues. I myself have gone through phases where I spent my money pretty foolishly. Despite being a personal finance blogger for five years, I can confirm that I haven’t always made the best decisions with my money.

I wanted to thank Crystal for allowing me to guest post again. I’m usually pretty serious or trying to be. Today I wanted to have some fun and write about my financial addictions/mistakes over the years.

Where do I regret spending money over the years? What have been some of my problem areas when it comes to blowing my money?

Cologne

Am I the only one here that has had a strange cologne addiction? I’ve gone through phases where I just had to have every popular scent. I just couldn’t resist. I would research different types of cologne and I learned all about how cologne works. I always had to have the newest cologne. I even went as far as to not wear the same scent two days in a row.

How did I improve this? I just stopped buying cologne and decided to stick with what I have. If I run out, I look for a sale before I buy another bottle. I still love to smell good though.

Useless Nights Out

I’ve had way too many pointless nights out where I should have stayed home. I would go out just for the sake of not staying home.

I’m all for fun and enjoy myself with friends. There’s just no sense in getting wasted for no reason just because it’s Saturday. You don’t have to turn any little thing into an excuse for going out.

How did I improve here? I cut back on drinking, go out less often, and I pick-and-choose my nights. This is a huge savings in your 20s. If you can go out without drinking or cut back on your nights out, your wallet will thank you.

Books

I went through a phase in between my college partying and working like mad, where I became a voracious reader. The only problem was that instead of hitting up the library or exchanging books with friends, I just bought random books from Chapters. I mean totally random. I would just look for books that seemed interesting or I would ask the staff for recommendations. The staff always had some new book to recommend to me.

I have a whole stack of unfinished books in my room. Did I really think that I was going to read, “The Black Swan?” In the ultimate irony, I still haven’t read, “Getting Things Done.” I also haven’t opened that book on social media marketing. I usually find a book that I really enjoy (“Linchpin” by Seth Godin), read it slowly, take notes, and then read it again. Some books I never plan on even opening.

How did I change here? I luckily now get many books for free since publishers will contact me or I can contact them about book reviews. I also don’t let myself buy a new book until I’ve finished the current one.

Workout Supplements

Of course I want to get lean in 21 days! Sign me up for five cases of that product.

I’m a very impatient man. I don’t like to wait. So when I started working out, I had to have every workout supplement on the market. I didn’t know what I was buying nor did I care. I fell for the marketing. I knew that the claims were too good to be true, but I didn’t want to believe it.

What changed for me? I realized that you could never supplement training hard and eating well. Just like with personal finance, the fundamentals are key in the fitness industry. I also bought some books on the topic (see above) that opened my eyes on the issues with the supplement industry. Sadly, I never got lean in 21 days, but my wallet sure did lose a few pounds.

That’s how I spent money foolishly over the years. When I started writing about personal finance I was quick to brag about my accomplishments. I’ve come to believe that if you want to take pride in your achievements, you also need to hold yourself accountable for your mistakes.

Now it’s your turn to join in on the fun and share some of the ways you regret spending your hard-earned money. This is a judgment-free zone.

“Money is only a tool. It will take you wherever you wish, but it will not replace you as the driver.” — Ayn Rand