Each Monday, The Simple Dollar opens up the reader mailbags and answers ten to twenty simple questions offered up by the readers on personal finance topics and many other things. Got a question? Ask it in the comments. You might also enjoy the archive of earlier reader mailbags.

As usual, we’ll start things off with a few links to older articles that directly answer questions I’ve heard recently.
Should I Eliminate Financial Support For My Child After High School?
Lying to Yourself About Money (and Anything Else)
How Much Money Does Turning Off the Lights Really Save?

And now for some great reader questions!

The stimulus package might have some provisions in it for A) interest payments on auto loans, and B) sales tax on purchasing a new car. Will this affect your decision of when to buy a new vehicle if they make it through?
- Deborah

To a small extent, yes, but I don’t think it’ll have a big positive impact.

When such provisions go into effect, the car companies will pull back on some of their discounts immediately because these provisions will bring more customers onto the lot. In the end, you’ll likely end up paying a price that isn’t much different than you would have paid before the provisions went into effect.

We’re certainly aware of these provisions, but we’re not hanging our hat on them by any means.

How do you decide when to replace a washing machine?
- Lily

Here’s what we did recently when we had problems with our washing machine. We had a repairman come to our home to fix the washer. While he was working on it, I made some small talk with him. I asked him if the model we had typically has this problem or other problems. I asked a lot of questions about what he was fixing.

In a nutshell, I got him talking about what he knew, and he was pretty happy to share it.

Based on his comments, we decided to stick with the washer we have. He said multiple times that these washers were pretty sturdy until the motor goes, so we basically decided to stick with our washer until, well, the motor goes.

I am getting a $1500 bonus in mar 2009. my question to you is this what do you think about a wife not telling spouse about this cause if she does spouse will come up with a way to spend it. I am not telling him cause I want to save it for the future examp. car probs/ kids needs shoes/ mom needs to go grocery shopping. I know I should tell him but I have a secret stash that I keep and believe me I have saved my family when the crapper has hit the fan. what is your opinion on this. I am the saver/ spouse is and always will be the spender!!
- Eve

It seems like there’s quite a bit of mistrust going on in your marriage right now, and it needs to be resolved as soon as possible if you want to have a healthy long term marriage.

The first thing you need to approach is your spouse’s spending problems. Instead of attacking, I suggest simply talking to your partner about the goals and dreams you share. Work together to figure out what you both really want, then work from there to develop plans for reaching those goals. It’s a lot easier to turn around bad spending habits if you have something to work for.

You seem to want to save this windfall as an emergency fund. The honest thing to do is to simply tell your partner about the windfall and simply say that you’re going to hold onto it until an emergency occurs. Honesty is the foundation of a good marriage – no matter what you do, don’t hide the money.

What do you think of the vegetarian lifestyle? Is that something you would ever consider for yourself?
- Mary

My feeling on what people should eat is perhaps best expressed by Michael Pollan: “Eat food. Not too much. Mostly plants.” In other words, I believe strongly in making sure that you eat more fruits and vegetables than non-plants, but I don’t necessarily believe a meat-free diet is entirely necessary.

I tried vegetarianism for a thirty day trial a few years ago. It went well at first – I felt pretty energetic – but I fell off a cliff and felt exhausted after several days. The problem was that I simply wasn’t consuming enough calories. Thus, if you try vegetarianism, I would make sure to include a lot of higher-calorie vegetables and fruits in the mix, because most fruits and vegetables have a surprisingly low vegetable count. I would eat pounds of vegetables and only take in 200 calories or so.

Having said that, I have an old friend who has been a vegetarian for twenty five years. He says the key is to eat plenty of beans and rice – make them the backbone of every meal – and exercise quite a bit.

I have a process question more than a “what is the answer” question. The postage rate is going up in May. The PO sells “Forever Stamps” now which means we can lock in the current rate. What process would you use to decide how many books of forever stamps to buy before May? It’s certain money unless one loses the stamps (fire, flood, inattention, poor storage), but it’s today’s dollars vs. inflated dollars, etc. (We don’t have any debt, but I’d be curious how that would affect the decision as well). Thanks!
- Hillary

Here’s what I would do. First, I’d calculate the percentage change in the price of a first class stamp. Since it’s going to $0.44 from $0.42, that’s roughly a 5% increase.

Next, I’d check out the current rate of inflation, which is around 4% annually (depending on the metric you use).

Then, I’d simply divide the percent increase by the rate of inflation to get a thumbnail of how many years it will be before $0.42 in today’s money is worth $0.44 in tomorrow’s money: roughly 1.25 years.

Now, how many stamps do you use in a year? Let’s say you use 100 stamps. That means, in order to get the maximum value out of the forever stamps, you should buy 100 stamps per year times 1.25 years, or 125 stamps.

That’s the procedure I would follow, anyway.

You’ve posted a couple times in the past about starting up a serious exercise regimen. I was just wondering how that is going and also if you have any tips on staying motivated. Thanks!
- Lauren

Currently, I’m going to the gym for an hour’s worth of cardio three or four times a week (depending on my schedule). I get on the elliptical, get the heart rate monitor going, and try to keep my heart rate at 80% of my maximum. I usually sweat a ton during this, so I bring a water bottle with me and drink it down during the exercise.

I’m also going through the one hundred push ups program and the two hundred sit ups program to focus on two areas where I really need to build muscle.

It’s going well. I use daily metrics to keep myself focused. I simply have these three things on my to-do list every day, and I also weigh myself every single day. Making these things part of my daily routine was very hard at first – I just committed to doing them for thirty days and if I still hated it, I’d stop. I hated it for about the first three weeks, but after that, it started to become fun – I would feel great at the end of exercising.

I was surprised by your car advice, living in Iowa as you do. We live in Michigan and the salt eats cars alive up here. Every single old car I have had has died of rust long before the working parts have worn out. (We had one we drove until it literally dropped…fortunately DH was only going 20 mph.) Now I always look for young cars with higher (highway if possible) mileage. Our experience has been that the engines will last practically forever; not so the body.
- Kathryn

I’ve lived in the upper Midwest my entire life and I’ve never had problems with rust on vehicles that were less than twelve years old. Modern paint does a great job of protecting the car and a good undercoating helps, too.

However, the real key is to just keep it clean during the winter. Just rinse the salt dust off of your car every week or two during the winter, or take it through a car wash regularly. It keeps your vehicle looking clean and good and keeps the rust away.

Now, I own a 1997 Ford F-150 and a bit of rust is beginning to appear on it (finally), but it’s still far from being a rust bucket.

Hi Trent. I’m new to blogging, only got 2 or 3 posts going atm. How can I get my blog to appear on Google? Even when I type in all the keywords I can think of, I can’t find it!
- Vanessa

First, you need to actually submit your site to Google. If you don’t do that, Google doesn’t know that your site exists.

Beyond that, you also need to get people to link to your site. The best way to do that is to simply write interesting or useful stuff and link to relevant articles at other blogs. Link to a mix of places – popular blogs and unpopular blogs, new blogs and old blogs. Then, make an effort to get to know other bloggers on your topic. You can do this by seeking out blogs similar to yours and writing to the authors. You’ll have more success building relationships with bloggers with smaller audiences, especially at first.

My question for next weeks mailbag would be surrounding 403b’s. I am 24, live in a big expensive metro area and get to save very little money, but the nonprofit I work for offers a 403b and there is no employer match or anything like that. I put away 5% or so (I think) per month into that account but I was wondering if that money wouldn’t be better off in a Roth IRA or anything of that sort. Thanks for any input you can provide
- Will

If you’re not getting an employer match and you’re early in your career, you’re almost always better off putting your retirement money into a Roth IRA and not worrying about the 403(b) unless you want to save even more than the Roth IRA cap.

Here’s why: with the Roth IRA, you use after-tax money for your savings, but the money you withdraw at retirement isn’t taxed. Since you’re early in your career, you’re likely paying a much lower interest rate now than you would be in retirement, so there’s a big tax advantage in using a Roth IRA.

Another advantage Roth IRAs have is the freedom of choice. Since you’re setting it up yourself, you not only get a huge choice of investment options, you also have a lot of choice when it comes to deciding who to invest with. I use Vanguard, myself.

I’m using a mobile phone to access The Simple Dollar, but the page is really big. Any way I can see The Simple Dollar well on a smaller screen?
- Steve

I’m currently looking into setting up a mobile version of The Simple Dollar, but there are a lot of solutions for reading the site in a mobile format right now.

One great option is to use Google’s free mobile view. Here’s the mobile view of The Simple Dollar. It simply displays the last ten headlines – you can then click on them to read the article in a very bare-bones format.

Got any questions? Ask them in the comments and I’ll use them in future mailbags.

Many of you will probably remember the little debate between myself and Ramit Sethi a few weeks ago about the usefulness of frugality. Ramit stated that the best move a person can make is to focus on the “big five” – identify the five biggest way to save money in your life and make them happen. My position is a bit different – I believe there is a lot of value in digging into frugality and finding additional tactics that work for you.

More than anything, the “debate” outlined two things. First, Ramit and I have different tones and styles of writing. He’s far more brash and “loud” than I am (at least in terms of writing about personal finance) – and I think the two styles appeal to different people to an extent. Second, we also have different audiences. Ramit focuses on people who have likely never considered how to cut back their spending, while I tend to write for people who have already made that realization and are working through the implications of it.

Frankly, I’m glad Ramit is out there writing in his style, addressing his audience. He’s reaching people that I wouldn’t be able to reach (and vice versa), but we’re both largely sharing the same message: there is great benefit in turning your financial life around, and cutting spending is one big part of the puzzle.

This brings us to his book, I Will Teach You To Be Rich. All one has to do is glance at the cover to realize what you’re going to find inside. It’s full of Ramit’s style of brash writing, which covers the big issues of personal finance in a way that will greatly appeal to a specific audience – twenty- and thirtysomethings who want irreverent and in-your-face basic personal finance advice.

Is there worthwhile content inside, though? Let’s dig in and see what Ramit has to say.

Would You Rather Be Sexy or Rich?
What does “rich” mean to you? I somewhat addressed this question a few weeks ago. In the end, Ramit speaks the truth here – we all have different definitions of “rich” and, because of that, we all want to be “rich.” Most of his examples revolve around people with more material desires – a woman who enjoys buying jeans, a guy who loves to travel – but the message is still true. Before you can be “rich,” you need to figure out what “rich” means for you. (For me, incidentally, it means being able to securely support my family and involve them in a lot of fulfilling experiences.)

Optimize Your Credit Cards
Ramit’s first step is getting your credit cards in order, and the first part of that is getting your credit report and making sure it’s accurate. After that, set up a debt repayment plan to clear out this debt as quickly and efficiently as possible. The one piece of advice that might irritate some (though I do agree with it) is Ramit’s suggestion that everyone get a credit card, even if they don’t use it. Why? Establishing a credit history helps you in many ways, from lowering your insurance rates to helping you with job applications (since many jobs run a credit check on applicants).

Beat the Banks
Get a good checking account (one that doesn’t eat you alive with fees and pays a bit of interest) and a good savings account (one that pays a solid interest rate and has good customer service). Then set up an automatic savings plan to start putting money in your savings account – in other words, start building a real emergency fund. That’s Ramit’s advice here in a nutshell, and while it seems basic, it’s information that a surprising amount of people have never done. I should know – for many years, I had an awful checking account with a large bank that dinged me with tons of fees every month with no real benefit.

Get Ready to Invest
Here, Ramit basically orders the readers to open up a 401(k) and/or Roth IRA now, even if you’re not sure what to invest in. Start saving now – if you don’t know what investment to put your money in, put it in something very safe until you’re able to figure it out. The key is to start saving now – don’t worry about the investing choices. Why? If you get started now instead of a year from now, you’ve got a year’s worth of savings built up even if you haven’t done anything with it. Even if it’s just sitting there earning 2%, at least you’re saving and earning a bit – that’s far, far better than nothing, especially if you’re getting an employer match.

Conscious Spending
Most of this chapter focuses on the idea of a “conscious spending plan.” In a nutshell, a conscious spending plan means identifying what your “required” spending is – your housing, your food, your automobile, and other basic needs – then adding savings and investing on top of that, leaving 20-25% of your money “free” to be spent on non-essential things. This works very well if you have a strong income, but the advice doesn’t apply nearly as well to lower-income folks.

Save while Sleeping
Automate as much as you can. That’s Ramit’s message here. Get as many of your accounts linked as you can (using online banking tools) and make as many of your payments automatic as you possibly can. This drastically reduces the time involved with paying bills, plus it ensures that you won’t be late with payments. Even better, you can also add in automated savings here, treating them as another “automatic” bill, which makes it easy to save.

The Myth of Financial Expertise
Ramit’s chief argument here is that so-called “financial experts” rarely know significantly more than a well-motivated person can with a bit of research on their own. He cites several reasons for this, most notably that even the best financial experts can’t beat the market consistently (so why not just invest in an index fund and ride the market?). If you really need advice, seek out a fee-only financial planner who can help you get things in order, then handle most of the management yourself (it’s easy with all of the online tools available these days).

Investing Isn’t Only for Rich People
The internet has brought the tools for investing to the masses. You have access to tons and tons of information – everything from the very basics of investing all the way to reams of data on virtually every investment out there. Plus, you have plenty of tools to actually do the investing yourself. You can set up an investing account, research investments, and make your investing choices all from your computer. The excuse for not doing it isn’t lack of information or lack of tools – it’s up to you and you alone to take the first step in investing.

Easy Maintenance
Much like dieting and exercising, it’s easy to get started, but it’s much harder to do the maintenance needed over a long period of time. Thankfully, personal finance maintenance can be quite easy. Automate as much as you can, first of all. After that, maintenance mostly revolves around keeping an eye on things and making pretty infrequent decisions (such as rebalancing and, rarely, deciding to sell an investment). The more work you do up front, the easier maintenance becomes.

A Rich Life
The final chapter focuses on major life expensses: a car, a home, a wedding, an education, and so forth. The best solution for all of these is a simple one: plan ahead. The earlier you begin planning (and saving), the less you have to save and the easier the entire process becomes. Ramit also discusses some strategies for negotiating a salary. Even better, on page 240, the book features a two-page sidebar discussion written by me on how to utilize raises.

Is I Will Teach You To Be Rich Worth Reading?
I Will Teach You To Be Rich actually reminds me quite a lot of another good personal finance book I reviewed in the past, You’re So Money by Farnoosh Torabi. They both speak to a young audience with a fair dose of irreverence, humor, and brashness. They both often advocate a more consumer-oriented lifestyle than I enjoy. They’re both also written for a somewhat younger audience than I am, since they’re both targeting young, single professionals (Torabi specifically targets young female professionals, while Ramit seems to target both genders).

Yet I can easily see how I Will Teach You To Be Rich can bring personal finance to life for a person fresh out of college and looking to conquer the world. In fact, I Will Teach You To Be Rich would probably be my default “graduation gift” for a college student who needs to learn the basics of personal finance.

I Will Teach You To Be Rich is the perfect book for that audience. Other readers may be driven away by the tone or, in some cases, the simplicity of the advice, but, to put it simply, it’s pretty obvious the book isn’t written for you. Ramit has a pretty specific audience in mind and he hits it almost perfectly. Good work.

Our life is fraught with road trips.

Roughly once a month, we make a four hour road trip (one way) to visit either my parents or my wife’s parents for the weekend. We usually make a several hour road trip (one way) or two each year to visit the Chicagoland area, where we have a lot of friends and family.

This experience has taught us two things: even simple road trips can be fraught with many unexpected little expenses that really add up, and children make the problem substantially worse as they often cause extra stops on their own.

Over the past few years, we’ve tried lots of different strategies for reducing the cost of such trips. In the end, though, a handful of techniques have served us better than everything else.

Your biggest challenge is avoiding stops. Every time you stop on a road trip, you’re opening the door to a lot of impulse buying opportunities. A thirsty or hungry traveler stopping at a gas station in the middle of a long leg is very likely to spend cash that they really don’t need to spend. So, what can we do so that the chances of such gas station stops are minimized?

Do some prep work before you go. Air up your tires to the maximum recommended pressure to maximize your gas mileage. Pull anything heavy and unnecessary out of your car. Make everyone go to the bathroom before you leave. Make sure you have a map of the route, even if you have a GPS device (the paper backup can save you if you run out of batteries or the GPS unit fails). And, perhaps most importantly…

Pack reasonable supplies in the car. Pack healthy snacks, plenty of drinking water, and supplies for cleaning up small messes. In the winter, make sure you have blankets as well. If riders aren’t hungry or thirsty when the car stops, they’re much less likely to spend money unnecessarily.

Our tactic is usually to fill four or so large refillable water bottles with a lot of ice and filtered water. As the trip goes on, the ice melts, but the water remains quite cool, giving us cool water to drink even in the later stages of the trip.

Healthy snacks vary based on what’s on hand. We usually stick to fruits and vegetables, as they’re inexpensive, quite healthy, can be eaten without a mess, and generate few leftovers (and what is generated can be disposed of easily, like a banana peel). A bunch of bananas, some carrot sticks, and a box of raisins make for some very healthy and inexpensive options in the car.

Keep plenty of distractions in the car – and a few aces up your sleeve. Another key to making long trips work is to make sure you have plenty of distractions for the kids – and for the adults, too. Our process usually involves allowing our son (who is three years old) to pack a small “car bag” for himself that includes some books and toys. We also pack several items for our one year old daughter in the diaper bag. For ourselves, we usually pack a few CDs or an audiobook for those times when we can’t find a public radio station.

I usually pack a surprise or two for the kids. I hold onto the item until the kids are getting very anxious to get out of the car, then I spring it on them. I often use the family portable DVD player for this purpose (it was given as a gift to the entire family this past Christmas), but I also bring along a few of their favorite books, which either myself or my wife will read aloud.

Make “long stops” rather than short ones. When we do stop, we make the stop into a “long stop.” Usually, this means that we stop at a gas station solely for refueling, then all of us go into a grocery store, where we pick out a few low-cost items for a picnic lunch while also ensuring everyone has time to go to the bathroom and get necessary diaper changes.

We usually then look for a park in whatever town we’re in, then assemble and eat our picnic dinner in the park. We then allow the kids to run around for a while to burn off some of their pent-up energy. Before we get back into the car, everyone uses the restroom again.

Doing this causes a significant drop in the number of stops made on the trip. Thus, even though this makes for a fairly long stop, it often means that there won’t be any other stops on the trip – and if this eliminates a couple additional stops along the way, then it not only saves money, it saves time, too. It allows everyone a chance to get out and stretch for a significant period of time, which helps quite a bit with the road weariness of a child.

In short, the “big stop” has become a consistent part of our road trips as of late – and it’s proven to be very successful for reducing our costs and our time (as compared to three or four “quick” stops).

Good luck!

If you had told us a year ago when we started our research that we would wind up settling on a new car for our car purchase, I would have laughed at you. We’ve been strongly committed to buying a late model used car for a long time, since we viewed it as the best “bang for the buck” option, especially since we intended to drive our newly purchased car until it literally began falling apart – a state that our 1999 Mercury Sable was in.

When we started our process for buying a new car, we focused on a small handful of factors:

We wanted a late model used car with a reasonable number of miles on it. We didn’t want to buy a car with a lot of miles on it because we believed we would be back where we started in just a few years. We were looking mostly for late model used cars with less than 60,000 miles on them.

A compact car doesn’t work. I’m six and a half feet tall. Our 1999 Mercury Sable is about the smallest car I can sit in comfortably. Smaller models simply do not work for me – I cannot sit in them because my knees are literally pressed into the dashboard.

Fuel efficiency and reliability were our primary factors. We’ve never been interested in bells and whistles. We don’t need a six-disc CD player or in-dash GPS. We have no interest in leather seats and so on. The basic package is enough for us.

We actually calculated the fuel efficiency of each car by calculating how much we would have to spend on gas over the lifetime of the car – up to 150,000 miles, which is our estimate for how far we would drive it. We figured 15,000 miles per year, with the cost of gas being $3 per gallon on average.

Fuel efficiency is particularly important for us because this car will be used for my wife’s commute. Roominess for long trips isn’t nearly as important here – we’ll mostly use it for commuting, local errands, and some weekend trips.

Thus, we started our search looking at 2004, 2005, and 2006 sedans. I visited the library several times along the way and we looked at quite a few cars. We eventually settled on a handful of models that we were interested in – the Honda Accord and the Toyota Camry led the pack, with a few other models we were considering. (The Prius wasn’t even on the radar at this point.)

What we began to notice is that, in the models we were looking at, the new cars weren’t a lot higher than the used versions we were looking at. We would see a used 2005 Camry with 50,000 miles on it at 60-65% the price of a new Camry, for example, and our per-mile calculations would show us that we would get the same value-per-mile out of the new car if we drove it to 150,000 miles, plus with the new car, we would get two or three years of initial low-trouble driving out of the car (the first 50,000 miles).

The prices were mostly the result of the economy in late 2008. Reliable used cars were holding their value well, but new cars, even on models that sold well, were seeing great prices.

Thus, we began to include new cars in our search. This was cemented at a large Toyota dealership in mid-February, when one salesman quoted us a price on a used ’09 Camry (with a few features we didn’t want) that was only $1,000 less than a new ’09 Camry.

Another factor: the stimulus package. Here’s the scoop, per cnn:

Under the Auto Ownership Tax Assistance Amendment, car buyers will be able to deduct sales and excise taxes on the purchase price of a car up to $49,500. As originally proposed by Sen. Barbara Mikulski, D-Md., interest payments would have been deductible as well.

The full text of the amendment (featuring fifty tons of legalese) is here, but the summary above makes the benefit pretty clear – the taxes paid on a new car plus car loan interest (note: the car loan interest provision was removed in a revision of the bill) are tax deductible. This saves us a few hundred dollars (at least) for buying new instead of buying used.

Yet another factor that nudged us towards new is the warranty offered on a new car. To put it simply, with auto insurance and a warranty, our only expenses on the car over the first several years are maintenance and deductibles (if anything happens). Although many used models have some degree of warranty available, most are very short term or are severely limited in some regard.

As our 1999 Mercury Sable began to exhibit more and more problems (failing struts, a transmission that would take five or so seconds to shift from first to second gear, our search began to grow more urgent. We received the 2009 car issue of Consumer Reports in the mail and my wife and I pored over it carefully.

We focused on the entry-level family sedan section and eliminated them based on a handful of factors: it had to have at least average safety, it had to have fuel efficiency above 22 miles per gallon, and it had to have a good reliability history. These factors quickly eliminated quite a few models, leaving us with just four new models that we agreed to consider along with the used models we were considering: the Toyota Prius, the Toyota Camry, the Nissan Sentra, and the Honda Accord.

Here is where the Prius began to really stand out for us. We did fuel efficiency calculations for these models assuming that we would drive them to the 150,000 mile mark with the same cost-per-gallon assumption we used above. According to that calculation ($3 per gallon), the Prius would cost us $9,782 in gas over the lifetime of the car (at 46 MPG), while the Camry (for example) would cost us $18,750 in gas over the lifetime of the car (at 24 MPG). A $9,000 savings on fuel (at the assumed $3 per gallon rate, of course) versus an average fuel-efficiency car was a huge factor for us in our calculations. To put it in another perspective, we anticipate putting roughly 15,000 miles per year on the car. Versus the Camry (which I’m using as an “average” sedan here for comparison), the Prius would save us $900 a year in fuel.

We spent a month comparing prices on used cars available at local dealerships as well as the new cars we had identified and, to put it quite simply, we could not find anything that really competed with the “bang for the buck” value of the Prius. Most of the used models we examined were priced close enough to the new models – even after negotiating – that we eventually came to the realization that the Prius was the right purchase for us.

Our down payment decision We had enough in cash to pay for the car in one shot, but two factors kept us from doing that. First, it would partially deplete our emergency fund, putting our family in a somewhat more risky spot. Second, we will have to replace our other vehicle (currently a Ford F-150 with somewhere around 140,000 miles on it) in the next year or two, so depleting our entire car savings might not be wise. Add into that the fact that our credit is stellar (we got a 4% rate on our car loan), we’re nearly breaking even by keeping the cash ourselves and holding it in a savings account plus we have the security of having a big emergency fund. We chose to put $5,000 down on the car to avoid any liability and insurance costs if we were to be underwater on the car at any point. The rest remains in our savings, minimizing our risk against other life emergencies.

(Edit: after reading many comments about whether or not we could afford the car, I wanted to note that we had enough in car savings to pay for the entire car in cash. We chose not to because we have a second vehicle that will need replacing in the next year or two and that may require major repairs in the near future (we consider that to be an emergency, hence the mention of “emergency” savings above – if our truck had failed right after buying the car, our emergency fund would have gotten hammered). At the same time, we were earning 3% in savings & CDs with the cash compared to the 4% loan – that didn’t offer enough incentive to lose the huge cushion in our savings.)

Thus, after all of this, we bought a 2009 Toyota Prius. After driving it for a weekend trip (and putting about 400 miles on it), the car is achieving almost exactly 42 miles per gallon (even with my wife lead-footing a bit on the interstate).

Here are four things we learned during the process.

Know what you actually want. Because this is a car we’ll use for commuting, our biggest factors were reliability and fuel efficiency. We did not want any extras, either – the base package is what we wanted. Thus, as we shopped, we were often comparing the base package for the new models versus a motley crew of packages for the used models, meaning the prices were often closer than they would be if we were demanding some certain “extras” as a minimum requirement. This changed our buying process significantly.

Before you even start shopping, spend some time figuring out exactly what you want. Spend some time considering the features you consider important – and focus on those factors. If a feature isn’t important to you, don’t pay for it.

Don’t restrict your horizons without a reason. Our original predisposition against new cars was mostly due to the prevailing notion that new cars simply aren’t a good buy. Yet, in those market conditions, we ran the numbers carefully and found that our overall cost of ownership with a new Prius over the period we intended to own it was lower than virtually all of the used models we could find.

Total cost of ownership per mile is a surprising (and useful) number. Most of our calculations centered around the total cost of owning the car up to 150,000 miles, then we figured out the cost-per-mile for the car. So, for example, if we have a used car we evaluate that has 70,000 miles on it, we figure out how much the cost of fuel and maintenance and insurance will be up to 150,000 miles, add that to the cost, then divide that by 80,000 miles (the amount we’ll actually use it). For the Prius, we figured up the cost of gas and maintenance and insurance through 150,000 miles, added that to the price, then divided by 150,000. In short, we looked for the best bang for the buck, not the lowest monthly payment, and the best deal turned out to be the new Prius.

Don’t go shopping in one day. Take your time. Visit lots of dealerships. Even if you know what you want, negotiate a bit with that dealer, but don’t sign on the dotted line immediately. Let them know that you’re visiting lots of dealers. I don’t claim to be a good negotiator, but I do know that visiting lots of dealerships, talking openly about the things we’re considering from other dealerships, and leaving dealerships after expressing some interest in a car on the lot only helped us over the long haul.

If you’re making a careful purchase, research and dealer visits will likely be part of the equation anyway, so play it to your advantage. This can easily save you thousands on the initial price.

Good luck!

Sasha writes in with a typical question:

A lot of different personal finance bloggers have different ways that they use credit cards. Some of them don’t use them at all. Others seem to use them a lot. Where do you stand and why?

I started off answering this question for the reader mailbag, but then I realized the answer was going to be rather long and involved so I spun it off into its own post.

So, let’s break this down bit by bit.

How do you use credit cards? To put it simply, we use rewards cards for routine purchases in our life and pay off the full balance at the end of the month. If we can’t afford the purchase or haven’t budgeted for it, the credit card is not a crutch to help us purchase it.

What do you do in emergencies without the card as a crutch? We have a large emergency fund in place to deal with true emergencies – a car breaking down, a hot water heater failing, and so on. We’re able to have this emergency fund because we consistently spend far less than we earn.

Why not just use a debit card? Two reasons. First, a debit card doesn’t improve your credit score. A healthy credit score not only helps you out with things like car loans, it also reduces your insurance rates. Second, a debit card typically doesn’t provide you with any rewards for using it. Similarly, using a debit card means the money is directly pulled from your checking account, and since my wife and I have an interest checking account, we prefer to keep the cash in there so that it can earn interest before we pay the credit card bill at the end of each month.

What cards do you use? My wife and I, between us, have three active credit cards – a Citi Driver’s Edge Mastercard, an Amazon.com Visa, and a Target Visa. We use the Driver’s Edge card for gas and automotive purchases, the Amazon card for purchases on amazon.com, and the Target card for purchases from Target. This allows us to get roughly 3% back on all of our purchases on cards. These three cards take care of the vast majority of our purchasing on cards.

Don’t reward cards encourage you to spend more? No. These cards are tools, not excuses to spend more. They simply make the purchasing process more convenient (it’s easier to run a card than it is to fill out a check at the checkout) and occasionally earn us a nice reward – a 10% off card for Target, a $25 reward certificate for Amazon, or, occasionally, a check from Citi.

What’s the disadvantage of doing things this way? First of all, you have to be disciplined. If you’re tempted to buy unnecessary things simply because you have the credit to do it, this strategy won’t work. You also need to have the routine of paying your credit card bills down cold – even one late payment can wipe out the benefits of doing things this way.

To put it simply, I do not believe credit is inherently bad as some people do. I believe the big risk associated with this strategy is personal – it’s up to your organization skills and personal willpower to make it a success. I’ll be the first to admit that there was a time when I didn’t have either of those attributes – and it resulted in $17,000 in credit card debt. I had to learn how to use a card.

If you have those attributes, using a reward credit card for your routine purchases provides nothing but benefits – better credit rating, rewards, and convenience at the purchase site. For us, these benefits have been a great help over the past few years.

I love reading essays. There are few things better than kicking back with a small piece of great writing that can both educate and entertain you, yet you’re finished in just one sitting.

For many, many years, Sports Illustrated was the home of the best in sports essays. For many years, I was a faithful subscriber, and when an issue would arrive in the mailbox, I’d quickly turn to the long article (usually the last one in the issue) and get absorbed into a great story that, at the same time, usually taught me lessons about humanity as well. (Nowadays, I usually read essays online and check out the annual Best American Sports Writing paperback).

A few years ago, a family member gave me a copy of Sports Illustrated’s Fifty Years of Great Writing. Simply put, it was a collection of some of the best essays ever published in Sports Illustrated.

Needless to say, I devoured it. Multiple times, actually.

Recently, I came across this volume while cleaning and found myself engrossed in these essays once again. I read several, then decided to do a bit of research into something I read in one of them. I fired up Google, did a search, and discovered something interesting: the essay’s text was available for free online!

So I spent some time locating all of the essays included in the book and saving them for future reference on my computer. Then, I realized that there are a lot of Simple Dollar readers who might enjoy the same thing.

Thus, here are the fifty two essays included in Sports Illustrated’s Fifty Years of Great Writing, free for your own enjoyment. You might be surprised at some of the literary heavy hitters here – Steinbeck, Faulkner, DeLillo. Many of these are among the very best sportswriting I’ve ever read. I hope you get as much enjoyment out of these as I have.

The Players
The Boxer and the Blonde by Frank Deford
Yogi by Roy Blount Jr.
The Last Angry Men by Rick Telander
The Year, The Moment and Johnny Podres by Robert Creamer
Gifts That God Didn’t Give by John Papanek
All the Rage by Richard Hoffer
The Ring Leader by Frank Deford

Main Events
“Lawdy, Lawdy, He’s Great” by Mark Kram
There’s Never Been An Open Like It by Dan Jenkins
The Day Bobby Hit the Home Run by Roger Kahn
A Pay Night for Old Archie by Budd Schulberg

Sweet Spots
Finally, We Were Left Alone, Just Me And My Bike by Thomas McGuane
A Personalized History Of Scottish Golf Or You’ll Not Do That Here, Laddie by Dan Jenkins
The Univesrity of Eighth Avenue and Part II by A. J. Liebling
Sons of the Wind by Kenny Moore
Road Swing by Steve Rushin

Wild Kingdom
Mirror of My Mood by Bil Gilbert
Snakes Alive! by Jeff MacGregor
Pure Heart by William Nack
Grim Reapers of the Land’s Bounty by Jim Harrison
We Are Destroying Our National Parks by Wallace Stegner

Supporting Players
“There Ain’t No Others Like Me” by Mark Kram
Master of the Joyful Illusion by William Barry Furlong
The Coach and His Champion by Alexander Wolff
“I Managed Good, But Boy Did They Play Bad” by Gilbert Rogin
Baseball’s Babbling Brook by Huston Horn

Playing for Laughs
Hype (Absolutely, Positively the Greatest Article Ever Written!) by Bruce Newman
‘Ring Tossed by Steve Rushin
We All Had a Ball by Roy Blount Jr.
The Curious Case of Sidd Finch by George Plimpton
Lake Wobegon Games by Garrison Keillor
Worst Baseball Team Ever by Jimmy Breslin
On the Winter Tour by Herbert Warren Wind

Personal Fouls
The Case Against Brian Spencer by Pete Dexter
Total Loss Weekend by Don DeLillo
This Is the Game of the Name by Franz Lidz
Crime and Punishment by Gary Smith
Broken Promise by S.L. Price
O Unlucky Man by William Nack

Music to the Ear
King of the Sports Page by Rick Reilly
Then My Arm Glassed Up by John Steinbeck
Heavyweight Championship Of The Word by Jeff MacGregor
Would You Let This Man Interview You? by Myron Cope
The Big Wind in Chicago by Ron Fimrite
Kentucky: May: Saturday by William Faulkner

Examined Lives
Farewell, Teddy Ballgame by Leigh Montville
The Ripples From Little Lake Nellie by Gary Smith
The Best Years of His Life by John Ed Bradley
He’s Burning to Be a Success by John Underwood
Laughing on the Outside by John Schulian
The Best There Ever Was by Frank Deford

Over the last few months, my three year old son has received quite a few $1 and $5 bills from relatives for various reasons – his birthday and Christmas chief among them.

Prior to the past few months, we would simply allow him to “spend” the money in a very simple fashion. He would take a dollar to the store with him, select a low-cost toy (usually a Hot Wheels car), then give that dollar to the cashier to pay for it (with Mom or Dad quietly making up the difference). It’s a simple enough lesson – money is something to be exchanged for goods and services.

Lately, though, he has become interested in purchasing other toys – some of which cost several dollars. Our answer up to this point has usually been that his dollar can only buy certain toys, but recently I decided that it was time to extend his learning a bit.

A few weeks ago, at the store, he had two dollars to spend. He spent most of his time intrigued by a nifty pullback car that cost $7.99 – and he wanted to spend just a dollar to buy it.

I told him quite simply, “This car costs eight dollars. You only have two dollars. You don’t have enough dollars to buy that car.” We worked through the counting using our fingers so that he understood that he needed six more dollars.

That didn’t shake his interest in the toy, however. He still wanted it.

“Well, if we don’t spend these dollars today and take them home with us, we can wait until we get six more dollars and then buy the car,” I suggested.

After some commiseration, he decided to spend one dollar on a small car and to try this saving concept with the other dollar. We got home, found a jar with a lid, and put the dollar inside so that he could see it.

That jar now sits on our kitchen counter. Since then, our son has been able to add some money to the jar – he can clearly see his savings as it builds up. He knows what it’s for and he’s excited to contribute to it whenever he can.

To put it simply, saving money has now become relevant and exciting for him. It’s very tangible – he can see his savings grow. He also has a goal that’s small enough that it seems reachable – he only needs to save up to $8, after all.

I think that the same aspects that are making saving tangible for my three year old son work well for adults, too:

Set a clear, tangible goal for savings. Know exactly what you’re saving for and keep it in mind. Figure out the exact dollar amount you need to reach. Know what the reward is for reaching that dollar amount. The more tangible your goal is, the easier it is to reach for it.

Set up milestones along the way so you can see progress. A $10,000 goal seems unbelievably high for many people. So transform it a bit. Turn it into a goal of $100 a month. With that little goal each month, you can reach your big goal in a bit less than eight years. Then push yourself just to reach that little goal each month – or to exceed it!

Keep the savings in your mind. Put up reminders of your goals in places where they’ll have impact for you. Wrap a picture of your kids or your dream house around your credit cards. Write the dollar amount on a Post-It note and keep it on the bottom of your rear view mirror. Keep that goal in your mind and you’ll stay focused on it.

So what’s next? The near future points us to our child’s next lesson: how do you earn money? That will be a whole new adventure.

In every place I’ve worked, I’ve noticed a handful of patterns. Some people seem to fit in well, do their work, and usually get the perks – opportunities, raises, and promotions. Others are just kind of “there” – they do their work, but they never step up to the plate and rarely get the perks – and often wondering why the perks don’t come their way. Still others are disgruntled and bitter, rarely doing anything beyond the bare minimum, loafing every chance they get, and simply filling up space until a reason comes up for them to be turned over.

Obviously, from the perspective of personal finance success, you’re far better off being in the first group than in the other two. The people in that first group are the ones that get the raises, the promotions, and the opportunities. Why? Because they’re the ones that actually provide significant value for their employers. This phenomenon is true no matter what the job is, from a computer programming shop to a research lab or a fast food restaurant.

The most interesting part is that people actively choose which group they’re in through their actions. Some people come in the door and look for opportunities to get ahead. Others go in, watch the clock, do their work, and get their paycheck. Still others try to throw sand in the gears.

If you want to get ahead, here are fourteen tactics you can use, no matter where you work.

Go to work well-rested and presentable. Never show up to work looking like you just rolled out of bed. Take a shower, wear clean clothes, use deodorant, brush your teeth, and do your best to look presentable. Also, get a good night of sleep before work so that you can be as mentally and physically fresh as possible. Every interaction you have in the workplace will reflect either positively or negatively upon you, and you can very easily increase the positive-ness of those interactions by just taking a half an hour to make yourself presentable.

Minimize negative comments. Every work environment provides ample opportunities for negativity, whether it’s just workplace gossip or your manager is asking questions. While it might feel good to participate in the negativity of gossip, don’t (feel free to listen, but don’t jump in with the negativity). Even when supervisors are seeking comments on other workers, hold back on the negativity and look for what positives you can find. Negativity in the workplace drags everyone down and positivity lifts everyone, so stick with the positive.

Don’t “backstab” anyone. Along those same lines, you’ll have many opportunities to “sell out” others in the workplace. Avoid it at all costs. If you have an opportunity to discuss other workers or particular situations, you might perceive that piling on those workers or those situations will benefit you – rarely is that actually true. Instead, look for the positives you can outline about anyone or anything.

If you have downtime, find something useful to do. Many workplaces have times where there is simply downtime – you’re waiting on new customers, you’ve finished your current project, and so on. That downtime is key in separating the people who get ahead from the people who get left behind. Find things to do with that time that’s useful. Clean up your workspace. Clean up the store. Work on a low-priority project. Improve your skills. There are always things that can be done – don’t just sit or stand around to be told what to do.

Do every task you’re given as well as you can. When you’re given a minor, menial task, it’s often very tempting to do it with minimal effort just to get it done. You’re supposed to sweep the floor, so you do it mindlessly and do a mediocre job. You’re given something to type up, but you don’t bother to check it for typos. You’re given a mundane system administration task, so you overlook a basic step. Instead of falling into that trap, try to give your complete focus to the task at hand and do it as best you can.

Learn from (and emulate) the people who do their job well. In most workplaces, it’s easy to identify the top workers. They’re the ones that managers defer to and ask for advice. They’re the ones who always seem to come through with the things that need to be done. As a result, they have job stability, plenty of options, and likely a very solid salary. Learn from these people. Ask them plenty of questions about how they get things done. Watch what they do, particularly with their downtime. In some situations, it might even be appropriate to ask them to be your mentor.

Build positive relationships with everyone in the workplace. You do nothing but gain from building a positive relationship with everyone in your workplace, from the highest level of management that you can easily interact with to the person who empties the trash cans. Be friendly to everyone. Ask how their day is going. Find some common interests and talk about them. The more people you develop positive relationships with (both up and down the hierarchy), the better off you’ll be.

Ignore poisonous people. Every workplace seems to have a poisonous person or two. I know I’ve interacted with plenty of such people in my years – and in a few cases, they’ve really reduced the quality of the work environment and made me more negative. If you’re stuck with a poisonous person, just minimize all interaction with that person. When you do have to interact, stick with the facts and get back to your own tasks. That person might spew some poison about you, but most workplaces have pretty clearly identified the poisonous people and take what they say with a grain of salt, so don’t let their responses or backstabbing bother you. Get your work done and move on with life.

Never use your sick leave as “extra vacation.” In one environment where I worked, this problem was endemic. As soon as a person had enough sick leave built up to take even a single day off, that person called in “sick” like clockwork – with one exception. Want to guess who the one person was that received a raise and then, later, a promotion was? It’s fine to use your sick leave when you’re actually ill, but consistent and reliable presence in the workplace is a huge benefit for your long-term career goals.

Improve yourself in your spare time. The simplest way to do this is to work on getting in better shape. Get some exercise and eat a healthy diet. Doing this will improve both your energy and your appearance, things that are purely beneficial in any work environment. If you have a job that requires some specific skills, find ways to improve those in your spare time as well. Keep up to date on your specific area of knowledge. Learn what you would need to know to take the next step in your career.

Step up to challenges when they present themselves. When a challenging situation comes up, don’t shy away from it. Step up to the plate and give it your best shot. If you think it might be over your head, ask for help when you need it. If you show yourself able to handle challenging tasks, you’ll become a more valuable employee, and a more valuable employee gets more perks.

Be a leader when it’s needed. When difficult situations occur, every workplace benefits from having someone they can rely on as a leader. Be the person that speaks for the workers during a meeting. Be the person who helps people out when they’re going through a crisis. Eventually, you’ll find that people simply come to you by default – and that includes management.

Own up to your own mistakes. If you mess up (and you inevitably will), admit to the mistake and do what you can to rectify it. Don’t try to hide it. Don’t try to pass the blame to others. Everyone makes mistakes. The winners are the people who own up to those mistakes and then go the extra mile to fix the created problem.

Stand up for yourself when you want a raise or promotion. If you want a raise or a promotion, be clear about it. Ask your supervisor directly for what you want – and be able to make a good case for it. If you get a “no,” ask what you need to do to put yourself in position for it and do just that. If you don’t stand up for yourself, no one will.