Ask anyone what the important rules of money are and they’ll likely be able to give you several maxims that at least sound like good advice. Unfortunately, many people are walking around following rules that really don’t apply anymore. The subject of personal finance seems to attract old wives’ tales that masquerade as solid advice. If you follow any of these “rules”, you may be cheating yourself out of a fatter wallet:
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Last month I confessed to an addictive behavior: recreational shopping. I actually wasn’t sure if I could classify it as a full-fledged addiction. Then David commented, “I’m glad Vered got out of her ritual of checking the same website for new arrivals daily, but make no mistake, addiction was the perfect word to describe that behavior.” His comment got me thinking that it’s probably time to admit that I was indeed addicted to shopping – and to share how I was able to overcome my addiction.
My “harmless” daily virtual shopping trip had all the characteristics of an addiction. I knew I shouldn’t log on to that site, I struggled with it every single morning, but I did it anyway. And to add insult to injury, I then lied about it – I didn’t exactly share my purchases with my husband!
So how did I start on that path? First of all, I love shopping. Not everyone enjoys shopping, but those of us who do will know what I mean – browsing through merchandise, looking at beautiful items and picking a few that will become yours, bringing them home (or having them shipped), tearing up the wrappers and finding a new place for them. Shopping can be an extremely pleasant experience, especially since I believe humans are hardwired to love shiny new things and feel a sense of security when we surround ourselves with objects.
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My oldest daughter just started kindergarten and I’m quickly realizing school is going to be more expensive than I’d anticipated.
Though I was ready for some expenses, like clothes, lunches, and supplies, others – like the classroom cleaning supplies and tissues – caught me by surprise.
Here are the ways I’ve been trying to keep back-to-school costs down:
Buy A Year’s Worth of Supplies Now
School supplies aren’t going to be any cheaper than they are right now. Stocking up for the whole year (while crayons are a dollar a pack) makes more sense than paying three dollars in a month.
You don’t have to go overboard either. Just grab a couple extras of what your children regularly use. This way, you’ll have them on hand when it comes time to replenish.
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Hobbies, by definition, are something we do for enjoyment. They aren’t activities that we absolutely have to do. That means that in a purely financial sense, spending any money on hobbies — especially when you have other financial concerns like paying for food and shelter — is wrong. The reality of the situation, though, is very different. We all enjoy our hobbies (or we wouldn’t pursue them). It can help keep us motivated to pursue our other goals. If we never do anything fun, we may end up falling into a rut and feeling miserable. That’s no way to live. In that sense, we need that enjoyment almost as much as we need food if we’re going to live life to the fullest.
But How Much is Too Much?
The problem creeps in when you think about how much different hobbies cost. Photography can be a lot of fun, but you can wind up buying some very expensive equipment. Stamp-collecting can require purchasing stamps that may be worth more than the paper they’re printed on. Skydiving can cost more than $200 for a single jump. But if you enjoy your hobby, those hefty price tags can mean that your money is well spent: you may be getting a lot more out of spending that money than you would be buying a bigger house or saving it up for a rainy day.
There’s no denying that we all need a safety cushion. We each need to have a secure financial basis and spending more than a small portion of your budget on hobbies when you’re not in a great place financially rarely makes sense. Entirely cutting out enjoyable hobbies — especially those that are relatively inexpensive — should generally be a short-term strategy while you resolve other financial issues.
But when your financial house is in order, the question of how much to spend on your hobbies can be much harder to answer. If you don’t actually need a certain amount of money for anything, why shouldn’t you spend it on your hobbies? At the end of the day, money isn’t for hoarding.
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You read blogs like this to find the best ways to manage your money. Your intentions are terrific because saving money is something you know you need to do.
But as much as you read about it, you haven’t fully committed to a vision that will make it happen. You’re sabotaging yourself.
“What do you mean?” you ask. Here are seven ways you’re setting yourself up for financial failure:
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My son just started his junior year of high school, and although I have plenty of time to make a decision, I’m already contemplating what I want to give him for a graduation present in a few years. Television shows and movies tend to exaggerate what teens get from their parents for high school graduation. A brand new car might seem like a common gift, but the digital radio alarm clock I received from my parents is likely closer to the norm. Still, what if parents could give their child a Hollywood worthy graduation present? Would you believe me if I said you could give your son or daughter $60,000 for a graduation present? Here’s how I think you can do just that.
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