In the beginner’s mind there are many possibilities, but in the expert’s mind there are few.
Shunryu Suzuki

When I first began my financial turnaround, I was open to trying anything to improve my financial situation. I signed up for online savings accounts at several different banks. I constantly strove to shave every penny I could from my spending.

I failed, a lot. I’d try things that simply didn’t work, or would end up saving me only a few cents for an hour’s worth of effort.

One great example is my endeavor to collect nickel cans. In Iowa, we have a aluminum can and plastic bottle recycling program. Every time you buy a beverage in a can or bottle, you must pay a nickel “deposit.” Then, if you return that empty can or bottle, the state will refund you a nickel. Most grocery stores function as return centers, so it’s easy to get that money back, yet many people simply don’t bother. I decided to take advantage of this and tried valiantly to make scavenging cans and bottles worth my while. Unfortunately, my hourly rate at this endeavor (collecting, sorting, and returning) was roughly a dollar – not really worth it.

This conclusion should have been rather obvious from the outset – it’s pretty clear to me that collecting cans is not going to earn a significant return for the effort put in. Yet, as a beginner at getting my financial house in order, I was willing to try it out of a mix of enthusiasm and a lack of experience.

That excitement – and the experiences that it gave me – was invaluable. It took me from a person who barely had the first idea about money management and helped me pay off most of my debts, get me into a house, and help me build a strong retirement plan and a big emergency fund and college savings for my kids.

Today, after years of trying all sorts of endeavors, I have a rather keen perception of what things will work and what things will not. I can consider experiments like collecting cans and quickly determine whether or not it’s worth the effort – and toss the losing endeavors very quickly. I have a strong basic understanding of most personal finance topics, and I can quickly identify things that work and things that do not.

Where does that leave me? As the Suzuki quote above implies, it leaves me in a seemingly limited place, without many options at all.

You can see some of this in the evolution of The Simple Dollar. When I first started, I would post as many as six articles a day. These articles were often very short – sometimes just a paragraph or two – and they were oozing with enthusiasm for all sorts of ideas. Some of these ideas were very good ones, like What Money Can’t Buy (a great example of my early realizations about the roles of money in life), but others were not so good, like The Power of the Pocket Change Jar.

Now, I only post two articles a day, but they’re much longer and often much more considered than they ever were back then. I toss out 90% of my ideas right off the bat – they simply don’t work or they won’t make for a compelling article. The ones that I do stick with tend to be much longer, more detailed, and based on a significant amount of personal experience or research. I stick mostly with things that I know work.

Many of you are probably in a similar situation when it comes to personal finance. You come to The Simple Dollar for fresh ideas and encouragement each day, but much of this material is at least somewhat familiar to you. You know the basics: spend less than you earn, find ways to cut your spending, try to increase your income, and seek what makes you happy.

Yet, if you’ve been following this path for years, how can it be fresh again? If you’ve been frugal for years, how can frugality be exciting again? If you’ve got your financials in order, what does it take to get you excited and engaged in it again?

Here’s what I do to keep things fresh.

I regularly re-evaluate all of my goals. I often do this in conjunction with my wife, and we usually do it once a month as part of an informal discussion about our financial state. Together, we question everything. Is saving for a house in the country still important? Or should we focus more on shorter-term things? Here’s an example: for years, we had been saving slowly for replacements for our current vehicles, intending to buy late model used automobiles. Now that we’re actually facing the need to replace vehicles, we’re doing some shopping and realizing that new versions of many of the best models are only slightly more than the late model used versions – and we’re very strongly looking at getting a new car. It’s a change from what we had considered a “set in stone” plan – and it’s only one example.

I make an effort to regularly try (or investigate) new things. I’ll go on “Wikipedia wanders” related to personal finance and other topics (seriously, try it – start with the entry about personal finance and click around until you’re in interesting new territory). I try out new inexpensive recipes all the time, both food and otherwise (like homemade laundry detergent). In each case, even if I find that the new things aren’t worthwhile, I still enjoy the experience and I still learn something new.

I listen carefully to people who are just starting their journey and share ideas back and forth with them. People who are at different stages in their life often have vastly different perspectives on the same topic. They bring different life experiences to the table and they bring new ways of looking at tired old ideas to the forefront. You might have noticed that I find myself as of late answering more and more reader questions – I do it because not only do I learn from reading about their experience, researching it, and giving my take, but I also learn from the ideas that others put up in the comments.

I keep reading. Many people are amazed that I’ve reviewed a book each week since 2006 on The Simple Dollar. I do it because, first and foremost, it keeps exposing me to new ideas and new angles on old ideas, and by reviewing them, I get the opportunity to evaluate those new ideas and also share them with you all (many of whom seem to really like the reviews).

Together, these things often let me see personal finance and frugality and personal growth through fresh new eyes, even if only for a little while. Doing that helps keep things fresh and interesting and helps me keep my eye on the ball in terms of managing my money and my life.

Good luck at seeing things in a new light!

This is the eighteenth in a weekly series of articles providing a chapter-by-chapter in-depth “book club” reading of Benjamin Graham’s investing classic The Intelligent Investor. Warren Buffett describes this book: “I read the first edition of this book early in 1950, when I was nineteen. I thought then that it was by far the best book about investing ever written. I still think it is.” I’m reading from the 2003 HarperBusiness Essentials paperback edition. This entry covers the seventeenth chapter, which is on pages 422 to 437, and the Jason Zweig commentary, on pages 438 to 445.

The real question in value investing is how do you identify the lemons that are mixed in with the ‘values’?

Obviously, when you’re digging into “value” companies, you’re seeking out companies that are currently undervalued by the stock market. This can happen for a lot of reasons: these companies are boring, these companies are not experiencing rapid growth, or, more ominously, something nasty is afoot with this business.

The problem with teasing out companies that are up to shenanigans is that there’s no ready made recipe for identifying them. This is where homework comes into play. You need to study the individual companies you invest in. Careful study of a company will often identify fundamental problems in their business plan – and if you see those things, you can stay away.

In this chapter, Graham discusses four examples of this kind of careful study:
Penn Central (Railroad) Co., which is an example of a corporate giant that’s rotting from the inside
Ling-Temco-Vought, Inc., which is a company that builds an empire on paper, but is actually pretty fragile
NVF Corp., which is an example of corporate acquisitions gone bad
AAA Enterprises, which is an example of a “hot” stock that’s getting elevated beyond all reason

Chapter 17: Four Extremely Instructive Case Histories
Here’s how Graham sniffed out the rat in each company.

Penn Central (Railroad) Co.
A careful reading of the company’s annual reports reveals that the company had been paying virtually no income tax for a decade. That’s a huge warning sign – if they’re not paying income tax, they’re either taking advantage of a ton of tax breaks (which you should be able to discover easily) or they’re not really earning much income at all.

How did they do it? They were reporting earnings without “charges” that were going to be taken several years down the road. These “charges,” however, were merely disguising that the company wasn’t really bringing in any income.

What can you do to avoid this? If you see a company reporting good earnings but also talking about “charges” for mysterious reasons that will be dealt with in future years, be very careful. They could be just extending the life of the company on paper when it’s actually in serious trouble.

Ling-Temco-Vought, Inc.
The warning signs? In 1966, the company stated that their assets were less than 5% of the stock value of the company. This means that if the company went bankrupt, the common stocks would pretty much be worthless – something to avoid like the plague if you’re investing for value.

Another warning sign: large investors started dumping the stock in droves. If you see big investors selling all of their stock in a company, you might want to consider doing the same. Watch out for big changes in institutional investing in the public reports on the company.

In 1969, the company reported a loss far bigger than the total profits in the history of the company. In one year, it lost more money than it ever earned – a sure sign something’s seriously wrong.

The way to avoid this is simple: avoid any stocks that are valued far beyond their asset value. Avoid any stocks that are being sold in droves by institutional investors. Avoid stocks that suddenly report a huge loss seemingly out of nowhere.

NVF Corp.
Here, NVF used a number of accounting gimmicks to hide the fact that they were acquiring companies with a huge amount of debt and unsteady business.

How did they do that? The most flagrant sign was that the company claimed an “asset” called “deferred debt expense” that was actually larger than the entire equity of the company. If you started digging into the annual report and figuring out what the items are, you soon realized that the company was actually claiming some debts as assets – and when you got that all straightened out, it became clear that the company was worthless.

You can avoid this by avoiding any company that has unexplainable items on their annual report. If you can’t get a rational explanation of what an element of a company’s annual report is, avoid that company.

AAA Enterprises
If you can’t determine why exactly people are investing in a company, don’t invest. That’s basically the story here, in which a tiny company played a hype game and wound up being valued at 115 times earnings – a number that’s not realistic no matter what the company.

This was all based on potential – much like the “dot com” stocks of 1999 and 2000. Graham’s point? Avoid companies that are selling nothing more than potential. If you can’t see real assets and real business there, don’t invest.

Commentary on Chapter 17
Zweig spends his commentary making modern analogies for each of these disasters.

Zweig compared Penn Central (Railroad) Co. to Lucent. Both companies were among the largest in America, but once you started digging into the books, it became clear that the large company was rotting from the inside, with apparent earnings that weren’t actually based in reality.

He compared Ling-Temco-Vought, Inc. to Tyco, both of which built a big paper empire that wasn’t really based on real-world assets, but instead based on mergers and shuffling.

He compared NVF Corp. to AOL-Time Warner, the best modern example of a merger that completely made no sense in which the minnow swallowed the whale.

Finally, the easy one: AAA Enterprises could have been compared to a lot of dot-com companies (my favorite disaster was Boo.com), but Zweig analogized it to eToys, another classic dot-com disaster.

What’s the lesson? These same tactics keep getting used and keep fooling investors. Be careful.

Next Friday, we’ll take a look at Chapter 18: A Comparison of Eight Pairs of Companies.

Ever since the first Valentine’s Day that my wife and I spent as a couple (1998, for those curious), we’ve done a wide variety of things to celebrate the day. We’ve went out for the fancy dinners. We’ve seen a vase full of roses on the dining room table. We’ve popped open boxes of chocolate. We’ve even settled in at home with the kids.

Here are a few things we’ve learned over the years.

Romantic time together means more than any material gift. Our best memories of Valentine’s Days past seem to always revolve around doing something together. It really doesn’t matter too much what we were doing – what matters is that we were simply together, enjoying each other’s company with as little interference as possible.

Thoughtfulness always outweighs any other factor. Thoughtful gifts are almost always treasured more than expensive and flashy gifts. My wife would enjoy a dozen roses, but a carefully thought-out handwritten note melted her heart much more effectively. A homemade dinner with a truly loved food that takes a lot of effort is almost always more memorable than yet another night out at a restaurant.

Shared experiences are better than “one way” gifts. Many people feel the pressure to give their significant other some kind of great Valentine’s Day gift. If you do feel the need to give a gift, the best way to make it a truly memorable one is to find a way to make it a shared experience. Instead of getting jewelry, get a pair of tickets to a concert. Instead of a dozen roses, get one and a gift card to a gardening shop so you can plant a rose bush in the spring together.

What do all of these things have in common? They’re almost universally less expensive and more memorable than the traditional flowers/chocolate/jewelry/night out that Valentine’s Day often connotates.

Need some specific ideas? Here are nine ideas from a post I wrote last year for a frugal Valentine’s Day…

Take time off. If you both have some vacation time built up, put in for a day off and spend it together. Do some simple and purely fun things that you wouldn’t ordinarily get to do. Cuddle together for a big chunk of the day and just enjoy each other instead of stressing out at work.

Make an elegant homecooked meal instead of hitting the town. Put in the time and make a wonderful meal at home. Put out a nice tablecloth, use a few candles, and make it a romantic evening at home instead of fighting the Valentine’s Day crowds out and about.

If you’re going out, do something unexpected. Lots of places will be crowded on that night, so do something unusual if you’re going out on the town. Don’t go to the high-dollar place – instead, ask around for something quiet and secluded and undiscovered. Not only will the meal be cheaper, it will also be more memorable and distinctive.

Do something low-stress. My wife and I used to celebrate Valentine’s Day with a trip to the bookstore together. We’d find some quiet chairs in the back and read through books together and talk quietly. We’d also go to a very low-key coffee shop and sip coffee together. These were very inexpensive things to do (provided we didn’t buy things at the bookstore), yet they were both enjoyable and fulfilling to us.

Don’t buy flowers without thought. Obviously, if your significant other would be devastated without flowers, pick some up, but don’t make it a requirement. I used to buy a dozen roses for my wife, but one year I came home with just two long stemmed red roses. Last year, I got a red rose, a pink one, and a white one. Another year, I got a flower selection that didn’t involve roses at all. In each case, I picked flowers with meaning instead of just pulling out the wallet and buying the dozen red ones.

Give a thoughtful gift. It’s easy to just buy jewelry or chocolates for Valentine’s Day, but it means more (and is less expensive) if you find a gift that truly has the recipient in mind. My wife is a science fiction fan, so one year in lieu of expensive gifts, I gave her a copy of Robert Heinlein’s Time Enough For Love with a little inscription. Guess which gift she still remembers, many years later? It’s not the chocolate.

Write a note expressing how you feel to go with that gift. A little sentimental note means a lot more than some extravagance. Spend some time and try to express – in your own handwriting – how you actually feel about your partner and why that person is so important to you. No matter the gift, that note will be the part that is meaningful.

Look for free concerts. Many communities have free Valentine’s Day concerts by municipal groups that don’t get widely publicized. Take a look at your community calendar and see what’s out there to do for free on that day.

Remember that your love is about the two of you, not about other things – and enjoy it. Hold each other close and enjoy each other, not things and events. Share a few passionate moments – that will mean far more than anything else you can do on this day. Best of all, it’s free!

And here are seven more ideas, culled from my own experiences over the years.

Bake some cookies. Instead of giving a generic (and probably expensive) gift of chocolates, bake some homemade cookies instead. Take a good chocolate chip cookie recipe – and add to it an ingredient that you know your partner will like. For example, my wife has baked me a batch of cookies before that were basically just chocolate chip cookies – but they also had cherries in them, cherries that were soaked in cherry liqueur before baking. It didn’t cost her much more than an hour or two of time and a couple dollars’ worth of ingredients, but the gift was not only delicious, but memorable.

Make a mix tape. Simply make a compilation CD of all of the songs that either mean something with regards to your relationship or express in some way the way you feel about your partner. This doesn’t necessarily have to mean all sappy romantic songs (for example, our “song” is the at best semi-romantic “She’s An Angel” by They Might Be Giants) – they just have to have some shared meaning between the two of you.

Go out for the atmosphere, not for the expensive food. If you do decide to go out on the town, eat at home and just stop by a place with a nice atmosphere for coffee or a drink and maybe a small snack or dessert. This way, you can enjoy the ambience and the romantic moment without the big, expensive bill at the end (which is a downer).

Do something silly. One year, we were snowed in on Valentine’s Day. What did we do? We put on some mood music, ate dinner together… and then colored. Seriously. We got out some printer paper and a box of crayons and drew pictures of various things. We gave the pictures to each other, too, and I still have mine.

Get refreshed. Put on pajamas, have a drink together, and relax in the most comfortable room in your home. Give each other a massage. Hold each other. Fall asleep in each other’s arms. Get a great night’s sleep. You’ll wake up the next day physically and emotionally refreshed without spending any money at all.

Consciously agree to save for something. Let’s say, hypothetically, you’re saving for a down payment. Instead of planning an elaborate Valentine’s Day celebration, stay at home, do some planning for this big step in your life, and put that $100 you saved into your savings account for that down payment. Apply this same principle to other “big” days in your life (birthdays, Christmas, etc.) and you’ll find yourself much closer to your big dream.

Volunteer. If you’re both socially conscious (and also adding in the fact that Valentine’s Day is on a Saturday this year), why not spend the day involved with a volunteer project together instead of doing the typical date thing? Help build a Habitat house. Serve a meal at the local food kitchen. Do some drudge work for a charity that matters to both of you. That way, the day means something beyond merely spending time together – and it doesn’t cost anything, either.

Good luck!

I really enjoy reading big collections of frugality tips. Books like The Complete Tightwad Gazette and web pages like 100 Things to Do During a Money Free Weekend are resources that I enjoy browsing through, looking at ideas and imagining how they might fit in my own life. That’s a big reason, actually, that I enjoyed writing my first book, 365 Ways to Live Cheap – it’s essentially a big collection of these tips.

Here’s the interesting part, though: I quickly discard at least 95% of the tips I read – and I don’t even implement most of what’s left. Most of the money-saving ideas that I read simply do not click with me at all – they just don’t fit into my life. They either require too much time, they’re centered around behaviors or activities that I’m not engaged in, they require a living situation that I don’t have, or they just generally sound unappealing.

Given that, it’s not surprising at all that many people find sharing frugality tips to be a big waste of time. If one were to read through a list of 100 tips and find that 97 of them are either useless or redundant, most of the time you’d toss that list straight in the trash can, right?

If I go through a list of 100 tips and find only two that click with my life, that time spent reading the list was well worth it. I spent, say, ten minutes browsing the list, and if I find two tips from that list that really click for me, then it’s been a worthwhile time investment.

Here’s the kicker, though, and it’s the part I really find interesting: the two tips that I find on that list that are interesting and useful to me are likely completely different than the tips you would find that would be useful to you. Our lives are different.

Do you live in a 2,000 square foot house in a rural area with two kids under the age of four? Most likely, you do not – however, you can likely name several attributes of your own life that don’t apply to my life. That doesn’t mean we can’t share ideas, but there are going to be ideas that I have that don’t work for you and ideas that you have that don’t work for me.

This brings to light three useful things when it comes to maximizing frugality in your own life.

First, you don’t have to do everything. Some people tend to see a list of frugal tactics and try to implement all of them, and they then feel like a failure (or blame the list) when they find that most of the tactics don’t really work. Here’s the truth – you don’t have to use all of the tactics you hear. Instead, you’re a lot better off just seeking out the small handful of new and interesting tactics that actually fit your life.

Second, you shouldn’t feel guilty about tips left unused. I know from reader emails (and my own experiences) that people can often make themselves feel bad about not practicing frugality. They’ll see a situation in their life and know that they could be making a better choice to save more money, but they don’t always choose that frugal method – and they feel guilty about it later. In a nutshell, don’t. If you’re actually focusing on not wasting money, yet you occasionally don’t make the optimal choice, you’re not making a mistake, you’re just balancing the values in your life. Take our situation, for example: we often choose to spend much more on food than we could because we value things like organic produce – it may not be the optimal way to save money, but it does match a certain value in our life.

Finally, the most surprising (and useful) ideas often come from people living in very different situations from you. I might find that almost all of the tips shared by a single person living in an urban environment (like, say, Sharon Harvey Rosenberg) don’t apply to me, but suddenly they’ll have one tip that I’d never considered before that really, really clicks for me. That’s why it’s useful to try to gather tips from a wide variety of sources – and it’s why I review personal finance books so often.

The money saving choices you make in your life are based on your life, not mine and not anyone else’s. Your best bet is to always see what others are doing to save money and cherry-pick the tactics that work well in your own life. Don’t use a long list of money saving tactics as a checklist – instead, use it as an idea resource and just pull out the handful that work well with your life. You’ll be money ahead without stress or guilt.

Good luck!

Julie writes in:

I have decided to apply to a library science master’s program. I can afford it without taking out a loan, it will take two years, and I will be able to take all my classes in the evenings after work and on weekends.

The problem? I don’t work in a library. I’m a little nervous about how my bosses will react to learning that I will probably be leaving my job in a few years, and I don’t want to jeopardize it in the meantime (though I really don’t think that will happen, I want to cover all my bases…).

Right now, I occasionally work late or attend (optional) evening events. When I’m unable to do these things once class starts, should I tell the truth? Will people find out anyway? (I’m also on Facebook and would love to be able to talk about school there, but some of my friends are also friends with people I work with.)

Is this something I should be concerned about, and how should I deal with it? What do you think?

First of all, I seriously applaud you for taking the initiative to follow something you’ve dreamed about. You’re switching careers to do something you want and done it in a financially sensible way – that’s something to truly be applauded.

Your question isn’t as straightforward as it seems. In a nutshell, you’re asking if you have an obligation to tell your employer that you’re embarking on a life path that will eventually lead you away from the company. I think each side of the equation deserves a fair examination.

The case for telling the employer is straightforward: it’s the honest thing to do. It does not require any duplicity and it’s much more likely to allow you to leave the company without burning any bridges if you eventually find out that library science isn’t for you. The risk is obvious, too: it does make you more expendable in the eyes of the company, and in a down economy, that could mean that your employment could go away sooner than you’d like.

On the other hand, you have the option of not telling your employer about your choice. This is much more likely to maintain the short term security of your job, but it puts you in a position where you may have to be dishonest about your choices.

My approach would be to be honest and open about what you’re doing but not focus on the potential job you’re seeking when you acquire the degree. Instead, tell the truth: you’re taking classes in library science because you’re passionate about library science and you’re stepping up to the plate about that passion. This way, you can openly share the things you’re learning and the progress you’re making with your friends and coworkers, but the focus is not on the idea that you’re potentially changing careers.

The reason for doing things this way is pretty simple. Once you have that degree, you might not, in the end, wind up actually working with that degree. You may find that you’re happier at your current job, but now you have that library science degree as a fallback plan (and perhaps as a resume builder in your current career). Simply acquiring this degree is not a guarantee that you will be switching careers.

Of course, when you’re in a situation where you’re actively hunting for library science jobs, you’ll be in something of a different position. My personal feeling is that, as long as you give your employer the appropriate amount of notice if you decide to leave, you shouldn’t feel obligated to tell your employer that you’re searching for a different job (unless, of course, you’re directly asked about it).

At this point, you’re following a passion, not seeking another job. Keep that in mind and you’ll be fine.

I’m quite sure that commenters will have a lot of different takes on this, though.

A recent BusinessWeek article (Obsolete Computers That Still Do The Job) inspired me to think about the “obsolete” things in my own life.

We have a television in the basement that’s reached double digits in age, has some colorization issues in the upper left corner, and weighs more than my wife, but it still does the job we want it to do – watch television programs.

I still keep a little notebook in my pocket, even with many other technology solutions, because nothing’s better at jotting down quick notes – it may be low tech, but it does the job.

Both of our vehicles are over ten years old and have more than 100,000 miles on them, but they’re still going.

Those supposedly “obsolete” things (and many others) keep doing their job. So we keep using them. It might be much flashier to replace them with a new item, but it’s certainly a lot more frugal to stick with what works.

10 Innovative But Obscure Sites That Put Money In Your Pocket Good list – I hadn’t heard of some of these! (@ wise bread)

Use Personal Marketing to Persuade Yourself to Save If advertisements are so effective, why not use some of those techniques to persuade yourself to adopt positive behaviors? (@ get rich slowly)

52 Ways to Make Extra Money This is really a solid collection of ideas, and the links are well worth clicking through. (@ prime time money)

“Where’s My Money Going” Month This is an excellent step to take if you feel out of touch with where your money is going. Even people who have their financial house in order (like me) can afford to do this every once in a while. (@ mrs. micah)

25 Uses for Dryer Sheets This one is for Bradshaw. (@ gather little by little)

A reader I’ll call Mitch has an interesting question:

About a week ago, I was sort of daydreaming while watching television when all of a sudden I had a great idea. I really think this idea has a lot of potential to affect a lot of lives. I’ve been doing a ton of internet research over the last few days to see if anyone else has had a similar idea, but I’ve not found anything very close to it.

I’d like to be able to make some money from this idea, but I think more than anything I’d just like to see it executed. Do you have any suggestions about what to do?

Most people have a handful of great ideas floating around in their heads (yes, I really do believe that). Unfortunately, most of those ideas either wind up buried, forgotten, or abandoned simply because people don’t know what to do with those ideas, they forget about those ideas, or they harbor visions of grandeur that aren’t realistic, holding the idea as an “ace in the hole” or throwing excessive resources into the idea.

The first question you need to ask yourself – and this is a pretty hard question – is whether or not you truly expect direct compensation for this idea. Some people have the expectation that every good idea they have deserves direct compensation. Others are quite happy to give their ideas away. Still others are somewhere in the middle – willing to give away some of their ideas, but attempt to sell others.

I struggled with this for a long time. I used to believe deeply that I deserved compensation for every idea and creative work. I would write short stories and essays, carefully protect my copyright on them, and seek out only paid opportunities to share that work. I was very hesitant to share any good idea I had, only sharing the ones I was being directly paid for.

Eventually, I realized that this wasn’t the way I wanted to go. I eventually came around to the opposite perspective – I now try to share as many of my ideas as I can as widely as I can without much worry for copyright, and I merely hope to earn a little bit of money in parallel with it. That’s why I blog instead of trying to sell articles to publishing outfits.

The question of whether or not you should directly receive compensation for an idea isn’t an easy question for anyone, and you should spend the time to come up with your own conclusion on the question.

Regardless of what you decide, the next step you need to take is making sure that the idea doesn’t already exist. Googling is a nice first step, but you should also check the U.S. Patent Office if appropriate.

The reason for this is simple: you simply do not want to present an idea as being your own if it clearly has been presented by others.

The next step is fleshing out the idea to the best of your abilities. Spend some time adding appropriate details to your idea. How can it be done or made? Is it even possible? Why is it useful? What evidence do you have for this idea?

This will likely involve some time and at least some minimal research using tools like Wikipedia. Obviously, your amount of effort in this area depends on a lot of factors: your expertise in the field, your interest in digging into the topic, and your seriousness about attempting to earn money from the idea.

Regardless of what you intend to do with the idea, fleshing it out a bit is still quite helpful. For one, it can often reveal fundamental problems in your idea that might be exposed in an embarrassing fashion if you didn’t do the appropriate work. For another, additional work makes it much easier to present the idea when you decide to move forward with it.

Speaking of which, the next step is figuring out how to present your idea. Your idea may be one best expressed as an essay. You might want to create a full presentation for it as well.

No matter how you intend to present it, you’ll also want to come up with an elevator pitch for the idea. At some point, when you share your idea, you’re going to need to get someone’s attention quickly. How will you get someone’s attention in just a sentence or just a few seconds? Try to boil the attractive element of your idea down to thirty words or so. If you can do this, you’re much more likely to get good attention to your idea.

Once you’re ready, share your idea. If you’ve decided to effectively give the idea away without worrying about compensation, seek out the person with the largest audience that may be interested in the idea, as that will give it the broadest presentation. If you’ve decided to sell the idea, you may need some legal assistance in this endeavor, but you’ll eventually seek to contact a company or organization that can transform the idea into something that can earn a profit.

There are many services that proclaim to help out people who are trying to patent or create or sell an idea. If you’re going this route, I would start with legal help from a source I personally trusted. That individual will likely point you in the right direction towards reputable resources that can help you out.

In general, this is a framework you can follow with any idea you have, large or small. However, you should be aware that most ideas are quite worthy of sharing, but likely aren’t quite worthy of earning you some money by themselves.

Good luck!

A long time reader that I’ll call “Samantha” wrote to me with the following question:

I’m a senior in college and will be graduating in May. I’m extremely blessed in that I will be graduating with no debt – a scholarship provided all of my tuition expenses, and my parents were able to cover room and board. I’ve had several jobs, including one on campus, and I’ve been able to hoard that money in a savings account. I have a credit card, but I ALWAYS pay the full amount each month. I feel extremely grateful for the opportunities I’ve been provided.

The reason I’m writing is that, for my graduation gift, my parents and I are working together to create a “Wisdom Book.” Essentially, I have asked all of the people in my life whom I love and admire to write down what advice they would like to give about life, love, money, etc. to a recent graduate like myself.

Would you recommend any specific questions to ask?

With regards to the specific question, I don’t think I would ask a specific question at all. Instead, I’d simply ask the following:

What single piece of advice do you wish you had heard when you were about to graduate college?

The truth of the matter is that you never quite know where a great piece of advice might come from. A financially well-off person that you might expect to give you investment advice might have that one perfect piece of relationship advice for you. At the same time, you might get a great piece of career advice from someone you’d never think of as a career guru.

What advice would I give in response to this question?

Follow your heart, always. Use your brain to give yourself as much security and safety as you can as your heart wanders. That means when you earn money, save some of it. Build up a big emergency fund in a savings account, then start investing some of it into the stock market with some index funds. Similarly, when you have a chance to pick up a new skill of any kind, jump on it. When you have the chance to establish a new relationship with someone, jump on it. The more relationships you have, the more money you have, the more skills you have, the easier it’s going to be to follow your heart. If you don’t do these things and take the easy path, you’re going to find yourself throughout your life being tied down to your circumstances, watching great opportunities pass you by, and that will leave you with nothing but regret.

And now, I’d like to open up this very question to my other readers for their comments. Please leave a comment and answer the big question:

What single piece of advice do you wish you had heard when you were about to graduate college?