Over the upcoming week, I’ll be posting a series of articles on the ethics of frugality. How far can you take things without crossing an ethical line or diving into seriously socially unacceptable waters? I’ll be recounting some of my own stories – and some stories from readers – along the way.

“Maddie” writes in:

My husband and I stayed at a hotel for two nights recently. As we left, my husband packed all of the hotel shampoo, conditioner, coffee packs, plastic cups, soap, and so on into his bag. On the way out, he stopped in the pool room and picked up two towels. I didn’t mind the disposable items in our room, since they would likely be tossed, but I thought taking the towels was wrong and I told him so. What do you think? Is it right to take things like this from a hotel when you stay there?

As always, there are two sides to every story. Let’s look at them.

Taking such items is stealing. A stay at a hotel consists of permission to use their room and to use disposable items they offer you. It is not permission to simply take items on the premises that you want. It would be the equivalent of going to a friend’s house and taking the soap and shampoo and toothpaste and towels out of their bathroom and taking them with you.

Such items are part of the service you receive. You’re paying a substantial fee to stay there – and part of that fee is toiletry and other simple convenience products for your use. Not using them is essentially the same as paying for something at a store, then handing the item back to the store owner and saying, “No, thank you!” That’s frugal foolishness!

My opinion is pretty straightforward on this one. I have no problem taking the items that would likely be disposed if I didn’t. The small convenience soaps, shampoos, conditioners, cleansers, coffee, and so forth are fair game for taking. However, the items that the hotel would re-use – like towels and the like – should be left there. Quite often, the hotel’s rules make it clear that if you take such an item from your room, they’ll charge you big. Using other means, like snagging a towel from the pool room or from the maid’s rack, is pretty much just stealing, as those are items that weren’t there for you to even use.

What do you think? Is it appropriate to take such items from the hotel? What items are appropriate to take?

The question continues, too. What should Maddie do with the towels that were taken from the hotel if she believes it was wrong to take them?

Should she return them? This is perhaps the most honest thing to do, since the towels are/were the property of the hotel. Is it okay to return them anonymously, or should she identify herself when returning them? Or should she just keep the towels?

If I were in Maddie’s shoes, I’d return the towels. I don’t think it makes any difference whether they’re returned anonymously or not – if you dropped them off at the front desk and say, “These accidentally wound up in our bags,” I doubt a word would be said. If you mailed them, I suppose they might investigate the return address, but I’d think it was unlikely. Most likely, they’d simply be accepted – and you’d be psychically off the hook.

What do you think? Should Maddie return the towels now that they’re taken?

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.

I especially like the fact that your website has minimal ads. However, I’ve noticed for the past few days that Crate and Barrel has advertisements on your home page. I live in the Atlanta area so I don’t know if the ads are specific to regional differences/popularity, etc. I was surprised to see the Crate and Barrel ad on your website. I think while the quality of what they sell is much better than average, the prices are astronomical. I have a good job, money in the bank, but I could not afford even, what I consider their knick knacks, unless they are on clearance. Also, I would imagine that many of your other readers might feel the same way. Anyway, this is just my perspective. I’m wondering if you’ve heard from anyone else on this?
- Tasneem

The good is the enemy of the perfect.

If I accepted only ads that absolutely, unequivocally met my definition of a perfectly ethical, great customer value organization, I wouldn’t have any ads on the site and The Simple Dollar would cease to function.

That’s not a good solution.

Instead, I just try to focus on a few key things. Is the company reputable? Are they producing a product of reasonable quality that’s at least worthy of consideration for use or purchase? If it passes these litmus tests, I’ll happily place the ad, even if it’s not something I would always purchase for myself.

Crate and Barrel have good items. Many of them are pretty highly priced. You might be able to find equivalent items elsewhere. But if you buy an item there, I don’t think you’d get ripped off – you’d be getting a good item. To me, that’s enough – they’re in the conversation when considering a particular type of purchase and they’re not scamming you.

Sure, I’d be a bigger fan if their prices were lower. But if I designed my “perfect” company from a consumer perspective – high quality items, environmentally sound, very low prices – the company couldn’t afford to stay in business. They wouldn’t turn a profit.

In the end, the perfect is the enemy of the good, and Crate and Barrel (and similar shops) are good enough, even if they don’t represent the best possible bargain out there.

Going into my senior year in college, I had minor surgery. I assumed that my mom and dad (divorced) would handle the medical bills the way they always had. A year later, in grad school, I started getting collections calls. I called my parents and found out that they had been fighting over the bills, which were in my name, and nothing had been paid. If I had known, I would have taken out more money in student loans to pay the hospital. I paid settlements to the two agencies that contacted me. I am now out of grad school, ran a free credit report from annualcreditreport, and see that I have a third account in collections that I never knew about. I’m pretty sure it’s my debt and not an error (my medical insurance was an 80/20 plan and I pieced together that our share was about $5000).

My question now is: do I contact them and try to work out a settlement for this last $1200 or do I wait for the debt to disappear from my report in 2 years? I have some ability to repay but I hate the thought of parting with money that I worked so hard to save and the hospital (which did an excellent job!) doesn’t get any of it.
- Kelli

The ethical thing to do is to always repay our debts. If you borrowed money from someone, it’s the right thing to do to pay it back.

Things get hazier in the real world, though, and it sounds like you’re in a mess. My suggestion here is to contact the holder of the debt and negotiate. Ask them what they would take to have the debt marked as paid on your credit report.

The real world is sometimes a sticky place. This sounds like it could be very close to a “he said, she said” kind of battle. In those cases, everyone involved is better off if someone just steps up and solves it – the mature person in the mix. It sounds like here, Kelli, that’s you.

Along those same lines…

I’m curious if you’re familiar with do-it-yourself credit repair, particularly for low dollar delinquencies (less than $500). I’ve read that with collection agencies you can write “pay to delete” letters where you agree to pay the entire amount in exchange for them removing it from your credit reports. Have you or any readers had success in removing negative items from your credit report?
- Christine

Let’s be clear: paying someone to remove accurate info from your credit report is illegal. It constitutes fraud.

Now, it’s always a good idea, if you owe money to a collection agency, to negotiate with them. What kind of payment will they accept in exchange for marking the debt as paid?

This is completely ethical and legal – it’s a negotiation between two parties over a debt. When you come to such an agreement and your report is updated, it won’t undo a long period of delinquent payment, but it will begin to immediately heal your credit history and credit score. And, as time passes and the debt fades into your past, your credit score and history will greatly improve over time.

Either way, you need to address this. An open wound like this on your credit report is doing you no favors at all.

I don’t understand the Idiocracy theory. If you have children, you have to devote a lot of resources (time and money) to raising them – resources that you could otherwise use to influence other people to take up your cause. On the other hand, if your cause is such that the only way you can persuade someone to take it up is to brainwash them with it from birth, then what kind of cause is that?
- Johanna

Look at it through demographics, Johanna. These statistics from the Russell Sage Foundation indicate that the more financial success a family has, the less likely they are to have children. Instead, they devote their time to developing skills, pushing forward causes, and growing their knowledge.

Sage’s statistics show that the poorest quintile of America – the group that has, on the whole, the worst set of behaviors for financial and professional success (I’m not saying they can’t succeed, I’m merely saying that the results of their efforts is the worst) – has, on average, 10% more children than the richest quintile.

So, let’s do the math on this. Let’s say you have five couples, one in each quintile. The couple in the lowest quintile produces 2.0 children, while the couple in the highest quintile produces 1.8 children. Thus, the number of people that would define the lowest quintile today will grow in the next generation, while the highest quintile will shrink. Some of the people with the traits of the lowest quintile will now find themselves in the next highest quintile simply because of sheer numbers. Thus, all higher quintiles – in other words, all of society – see a slight reduction in traits that gear towards success.

Over many generations, you see a large reduction in the traits of people that made up the highest quintile and an increase in the traits of people that made up the lowest quintile, whether those traits come from nature or from nurture. If this gap in child bearing continues, the behavioral and cultural norms of the lowest income people will become the cultural and behavioral norms of all of society.

Is that a good thing, a bad thing, or an indifferent thing? It’s something that could be endlessly debated. However, the effect itself is clearly happening – whether or not you can trace that back to cultural and social changes is another question altogether.

My belief is that, from the pure perspective of diversity, it’s a bad thing and that people who are successful in life can do their part to help the world by having children of their own and raising them with the care and compassion they show in other aspects of their lives, the aspects that brought them success.

Has Sarah ever commented on any of your articles just to keep you on your toes?
- Mol

Sarah (my wife) usually “comments” to me face to face about my articles. Usually, her comments revolve around some of the choices I make to protect privacy – I’ll leave out details about people, change their first names, or somehow alter them in an inconsequential way to protect their privacy.

Sometimes, she’ll get really aggravated with commenters, who read one article and immediately leave a flaming comment about a decision we puzzled over for months. I usually remind her that (a) these people are likely trolls and (b) if they’re not, they don’t have the full view or the time invested in studying our situation. A single post cannot possibly reveal all facets of a complex choice.

Every once in a while, she’ll harangue me for an inaccuracy somewhere, usually related to my juxtaposing elements of a remembered situation. “That never happened like that!” she’ll tell me, and then she’ll inform me how she remembers it. Likely, the actual story is somewhere in the middle – or maybe I’m right, or maybe she’s right. To me, it’s inconsequential – the important part of it is always the positive outcome.

I recently graduated college and have 2 student loans to pay off:
Loan 1: about $4,000 left on it with a 6.8% rate
Loan 2, Part 1: about $3,000 left with a 6.8% rate
Loan 2, Part 2: about $7,000 with a 4% rate
Loan 2, Part 3: about $6,000 with a 5.3% rate
The kicker on loan 2: I was ‘automatically selected’ to pay off both part 2 and 3 before I can even start paying off part 1 (with the crazy high rate).

I have asked around and done a bit of research on my own. Really the only thing that I keep coming back to is Ramsey’s idea of paying off the smallest loan first, while still making minimum payments on the other loan (so I don’t default). I have already built up an emergency fund and am trying to decide how to tackle these loans that would be the most profitable in the long run.
- AReynolds

Loan #1 should go first regardless of how you calculate it.

The way I calculate segmented loans like loan #2 is by figuring out the average interest rate. Just multiply the interest rate of each segment by the amount of that segment, add the totals of each segment together, then divide by the cash total of the loan. In this case, the average rate is 6.0125%. Over time, it’ll inch upwards, as the balance of the first segment will go up faster than the second and third, but the rate will never equal the rate of the first one.

I’d just think of loan #2 as a single loan with an interest rate of 6.0125%. That means you’re choosing between a loan with $4.000 on it at 6.8% or a loan with $16,000 on it at 6.0125%. Almost every method under the sun for debt repayment will tell you to go with the $4,000 loan first.

How much does it cost a company to maintain the record of your debt? Given that they have to pay someone to call you, have to pay for postage to contact you with documents, and any other costs they have to soak to keep your debt on file, at what point would it become less than worthwhile to keep your debt on the books?

To use an extreme case, suppose I had an outstanding balance of $.01 in debt, and maintained it at that level, it would be more cost-effective for the company to write that off than collect, wouldn’t it?
- prufock

Companies that have sensible bookkeeping procedures usually do forgive tiny amounts due. Bills for $0.01 are largely a thing of the past as companies have realized that there is a cost to bill a customer and that forgiving the remaining amount is the best route if the balance is lower than the cost of billing.

What’s that cost of billing? It largely determines on the internals of a company. I’ve received bills for $4 in the last few years, but I can’t recall anything lower.

From my back-of-the-envelope chicken scratches, I would guess that for most companies, billing amounts under a dollar or two are probably better off left unbilled. Instead, they often just sit there and are added to larger bills if a customer has a new charge in the future.

At the same time, though, it’s usually a good move for a company to issue a refund or a payment for any amount, even if it’s just $0.01. The cheapest way to do that is usually to just treat it like any other payment and issue a check. While it might be cheaper for them to just hold it and apply it as a credit to your next bill, it’s often not allowed – and they’re far better off following the rules to the letter.

If you were forced into a short-term debt situation right now, would you rather borrow money from a friend or a family member or go into credit card debt?
- Andy

I’d rather get into credit card debt if those were my only choices.

I very rarely see a situation that involves a family loan that doesn’t end up with hard feelings or resentment on one side of the coin or another. If this is just a short term debt small enough to be put on a credit card, I’d rather pay a hundred dollars in finance charges than jeopardize a valuable family relationship.

To me, the value in my life isn’t measured in dollars and cents. It’s measured in people. The risk I would add to such a relationship is worth the extra money a credit card debt would cost me.

What is a typical work day like for you?
- DeLa

I wake up around 6 AM and usually check my email. My office is right next door to the kids’ bedroom, so I hear them when they begin to awaken, usually around 6:30.

After that, it’s time for getting dressed, brushing hair, eating breakfast, a bit of horseplay, getting shoes on, getting any winter clothes on, and getting out the door to daycare. I’m usually more interested in just spending good time with the kids, so this isn’t rushed in any way unless I have something URGENT for work. Most days, my workday proper doesn’t start until 8:45 AM.

I usually spend the morning in three separate hourlong focus sessions, where I turn off the phone and focus on an article. I’ll usually try to finish a good draft in that timeframe. Between the sessions, I’ll take a break or do things like approve comments.

After that comes lunch and often another hourlong focus session. Then I’ll spend time editing the posts and setting them up for public display. I then usually do a big email session. After that, I’ll usually work on some other large project – a book manuscript, a post for my personal site, or something along those lines.

That gets me to about 3:30 in the afternoon, at which point I wind things down for the day. I’ll usually keep working on whatever the biggest “fire” is until my wife and kids arrive home around five.

About two days a week or so, I’ll spend the afternoon out and about. Sometimes, I’ll do something like grocery shopping with my notepad open to jot down ideas. Other times, I’ll go out to lunch with someone. Sometimes, I’ll spend an afternoon at the library.

To continue that train of thought…

If you work at home alone all day, how do you combat loneliness?
- Emerson

I don’t feel loneliness if I can consistently get myself into a creative zone – and most days, I can. It’s the days when I can’t that are the trickiest.

On those days, I usually go do something social. I’ll go eat lunch with someone I know. I’ll go to a coffee shop and work. I’ll try to pencil in an interview with someone. I’ve even sat in on a class at a local university.

There are always people doing something out and about in the community and it’s not hard to meet up with them. I’ve found that, for me, that’s enough.

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

Every other Sunday, The Simple Dollar reviews a personal development, personal productivity, career, or entrepreneurship book.

Since starting The Simple Dollar, I’ve gradually developed the belief that the reason many people get into financial trouble is that their lives become overwhelmingly complicated. Attempting to balance a career, a marriage, a family, relationships with friends, hobbies, community responsibilities, and so forth can pretty much drain a person, making them more susceptible to peer pressure and advertising’s influence. The end result is that they spend more than they should for a mix of reasons: emotional support, escapism, a desire to live the quality of life they think they deserve because of all of their hard work.

In truth, though, people in that type of high-pressure situation who seek some sort of quality improvement in their life are best served not by charging themselves into debt, but by dialing things back a little. Letting go of the little, unimportant things opens up the time and the emotional room for things that are really important – time with family, time with hobbies and personal passions, and time with loved ones and friends.

I know this from experience. My reaction to my early professional life – particularly immediately following the birth of my first child – was to spend with reckless abandon. I thought I should have a better life than I had because of my hard work and because of the lifestyle of my friends, so I spent money to chase that mirage. Along the way, though, I just became unhappier and eventually I found myself trapped in a ridiculously complicated life with more debt than I could handle.

The solution was simplifying my life, of which debt reduction and elimination was just one piece.

Recently, I picked up a copy of Janet Luhr’s Simple Living Guide, which basically has the same message: the best solution for the difficulties of modern life is to simplify things. It’s a pretty hefty book – nearly magazine-sized in height and width and almost 500 pages in length – but it’s loaded with countless ideas on simplifying one’s life, which often ties directly into a stronger personal finance situation. Let’s wade through the book a bit.

1 – Time
Luhrs’ argument here is that many of us have jammed our schedules so tight with stuff that on the rare occasions when we do have free time, we collapse in a heap of exhaustion and do something of little or no personal value to ourselves, like channel surfing. This arrangement devalues our time – most of the time, we’re so packed with stuff we barely enjoy it, and the rest of the time we do stuff that has very little personal value.

Luhrs suggests a different approach. Her first suggestion is to focus on one thing at a time, completing it well. Multitasking should be held to a minimum, because multitasking means that you’re only giving a slice of your attention and focus to things and are thus doing them at a low level of quality – not a standard that’s good for your sense of well-being. If this new approach means cutting some stuff out, so be it. The ramifications of this approach are pretty widespread – it leads to more pride and satisfaction in one’s work and free time and also leads to an elevated sense of quality in life. If you’re happy with what you’re doing, you have a much lower tendency to crumple and waste time at the end of the day – instead, you find ways to keep it up and spend that time on things personally important to you.

2 – Money
Debt is dangerous to a person’s spirit. It introduces living requirements into your life – you can’t lose your job, you can’t take challenging and rewarding risks with your career, and you move at a much slower pace towards the bigger goals you have in life. Debt is the enemy of simple living. Thus, in order to simplify your life, you have to boot the debt out.

How do you do that? The easiest recipe is to simply spend less than you earn and apply the difference to eliminating debt and building an emergency fund to keep crises at bay. Once that’s done, keep up the “spend less than you earn” mantra and apply that difference towards saving for the big dreams you have in life. Things are much simpler when you’ve got a fat bank account and no debt.

3 – Inner Simplicity
Mental exhaustion is another danger for many people. Jamming your mind full of complex thoughts and ideas and organizing lots of separate pieces of information constantly is a pure drain on your mental energy – and over time, you simply feel worn out by it, even though you weren’t exerting yourself physically.

Luhrs’ solution to this problem is to take time out without mental demands on yourself. She suggests meditation and/or prayer. I’ve found both to be a big help for me, particularly when it seems like I can least afford the spare time. Just stopping for a short period and clearing your mind of thought, of the mental debris of the day, goes a long ways towards making everything seem substantially more manageable.

4 – Work
For many of is, work is drudgery. It’s just a way to bring in the money to pay the bills. On a good day, it brings us a bit of joy – on the bad days, though, it’s awful, filled with politics and pettiness and other things we don’t enjoy. Yet we do it anyway.

Unsurprisingly, such an environment is a major obstacle to simple living. It drains our mental energy and saps our spirit. The best way to avoid it is to get out of debt (reducing the financial hold) and then seeking work that genuinely makes us happy. In other words, frugality becomes a gateway to the kind of happiness that we want to achieve.

5 – Simple Pleasures and Romance
Quite often, the joys in our life that bring us consistent happiness are the simple pleasures – breakfast in bed, a delicious cup of coffee, a glass of wine, an evening spent playing a game with your spouse. If we seek out these simple pleasures instead of investing tons of time and resources into enormous things that don’t generate nearly the enjoyment for the effort, we’re better off.

Of course, on the other end of the spectrum, simple pleasures become less pleasureful if they’re allowed to become completely routine. The pleasure of the morning coffee, for example, becomes an ordinary routine if done over and over again. The way to keep pleasures pleasureful is to mix up that routine. Don’t have a morning coffee every day (or have cheap coffee every day and a really good cup on occasion). Alter your evening routines all the time. Take a warm bath once for every ten showers. Simple pleasures are enjoyable because they break routines, not because they establish them.

6 – Virtues
What essential values do you hold most dear in your life? What virtues do you consider to be the most important? Living your life with these values and virtues at the center brings a certain amount of simplicity and joy from every element of your life.

If you value truth, for example, a life filled with lots of little white lies makes your life unhappy and needlessly complex. Break through this by sticking close to your virtue. Eliminate those little white lies.

The same goes for any virtue you hold in high esteem in your life. Strive to actually act through that virtue as much as you possibly can. The psychic rewards are tremendous.

7 – Families
If you made the choice to have a family – get married and/or have children – one of the most powerful things you can do with your time and energy is to spend it on them or with them. Families mean responsibility and joy at the same time, and the only way to live up to that responsibility and gain that joy is to invest in it with your time and energy.

Plan family-oriented events where everyone spends time together – I’m a big fan of “family game night.” Plan dates with your partner. Do little things to remind the people in your family that you care. Eat meals at home together, all at the same table. The reward? Better relationships with the people at the center of your life.

8 – Holidays
Many people try to “make up” for a year of neglect by going massively over the top, planning the “perfect” holiday season. Of course, the holidays are rarely perfect and thus you end up feeling disappointed and disheartened with the whole thing.

That’s the wrong approach. If you spend consistent time and energy on and with your family, the holidays no longer have to be “perfect.” Scale back on the festivities and play it more loose. You’ll find that the real joy of it comes from spending time together – and not worrying about perfection is a lot less expensive and a lot less stressful.

Yes, have traditions – they’re wonderful. But don’t make those traditions incredibly elaborate. Stick with the simple – a Christmas Eve reading of ‘Twas the Night Before Christmas, for example. Don’t worry about spending all of the holidays in the kitchen preparing some sort of perfect, elaborate meal.

9 – Cooking and Nutrition
The healthier the materials you put in your body, the healthier you’ll feel overall, both mentally and physically. That’s not to say that you subscribe to some sort of idealized diet – that adds stress – but instead that you should subscribe to just a few simple principles to guide what you eat.

What sort of principles? Luhrs offers some suggestions. I’ve found a lot of power in just following what Michael Pollan suggests in his book In Defense of Food: Eat food. Not too much. Mostly plants. By “food,” Pollan means unprocessed food, as close as possible to raw ingredients like vegetables and meats.

10 – Health and Exercise
Want to make your health and exercise simple? Understand how your body works. Learn more about it by reading basic guides to human health. Pay attention to the feedback it gives you – if you feel tired and sluggish and overweight, you likely need to make changes. Gently push it to make it stronger – in other words, exercise without overdoing it. Take long walks. Do simple weight exercise.

Unless you want a stunning body, a gym membership and a personal trainer are complete overkill, adding complexity to your life. Most of us just need to move a little bit, and we can get that by just adding more motion to our lives through simple exercise and walking.

11 – Housing
The American ideal often seems to be the big, giant house. However, that big, giant house requires a lot of upkeep and maintenance, eating our time, physical energy, and mental energy. Instead, we should strive for just enough housing to meet our needs and not our dreams.

If you’ve got rooms that you don’t use in your home, you should consider downgrading. Why? Mostly, that extra room just means more maintenance costs and maintenance time while it’s just used to store more and more stuff.

12 – Clutter
This idea of “more housing means more room for stuff” leads right into the idea of clutter. Clutter is one of the biggest opponents of simple living, as clutter means more maintenance time, more maintenance effort, more maintenance cost, and the psychic cost of having more stuff than you can deal with.

What can you do? Focus on getting rid of stuff you don’t use. If you don’t use the item more often than once a year, get rid of it. Sell it, trade it, gift it, hand it to a neighbor. Also, keep mail and “junk” from building up in the junk collecting areas in your home.

13 – Gardening
Luhrs is a strong advocate of gardening as a significant part of a simple life. In her eyes, gardening gets a person in touch with the earth and the environment around them, requires them to work their body but allows the mind to rest (almost in a meditative fashion), and produces the freshest food possible.

My wife and I are fairly avid gardeners. We have a small garden in which we grow a variety of fruits, vegetables, herbs, and flowers and, throughout the year, we’ve been able to enjoy the products of that garden. While I don’t really have a chance to get the “Zen” nature of gardening – trust me, with a two year old and a three year old trampling around, it can be hard to lose yourself in it – I do easily see how it can arrive.

14 – Travel
The book closes with a chapter on travel, which mostly argues that for most people, travel is overbooked with things and thus the travelers rarely get the time to truly enjoy the experience. I agree – the more wide open you can make your trip, the better. When we went on our honeymoon, our plan before we went was “spend a week in London, a few days in Edinburgh, and a few days in Inverness,” and it was tremendous.

Really, though, the value of traveling is that experiences, not things, are really the spice of life. Traveling with freedom opens the door to many, many experiences which will stick with you forever, adding true value to your life. It’s also much less expensive to loosely book your trips, since you’re not throwing money at activities that you don’t really have the time to fully enjoy.

Is The Simple Living Guide Worth Reading?
The Simple Living Guide is an excellent book to read if you feel as though your life is simply too complicated and that complexity is bringing you down. I tend to think that, in modern life, that’s a fairly common complaint. I know that, for me, I spent much of the early part of this decade feeling exactly that way.

However, if you already are living a fairly simple life, The Simple Living Guide probably won’t contribute much to your life. This is really just a great “food for thought/getting started” guide for a person whose life feels like it’s running off the rails.

I did enjoy the book, but in many places I thought to myself, “I’m already living this kind of a simple life.” I think that’s a good thing.

Over the upcoming week, I’ll be posting a series of articles on the ethics of frugality. How far can you take things without crossing an ethical line or diving into seriously socially unacceptable waters? I’ll be recounting some of my own stories – and some stories from readers – along the way.

“Jane” (we must protect the innocent here, right?) writes in:

My husband has always used this expensive Aveda shampoo for his hair. He says it needs to look good for work. I’ve always used Suave or Pert and it’s worked fine. Lately, I noticed that his shampoo looks almost identical to mine, so when his bottle was empty, I washed it out and filled it with my shampoo. I thought the only way he might notice is because of the difference in smell, but he hasn’t noticed it at all. In fact, I’ve refilled it twice with my cheap stuff. But now I feel kind of guilty about it. Should I tell him? Was this the right thing to do?

There are always two sides to every story. So let’s look at them.

It was fine, Jane. Your husband refused to even try a frugal alternative, so you essentially gave him a trial run at it. If he had noticed and it would have actually made a difference to him, no problem – it would be easy for him to pick up his Aveda and continue with the expensive stuff that actually works with his hair. Instead, you found out that his expensive shampoo may just be a “placebo effect” for him – the idea that he’s using an expensive shampoo means that, in his mind, he looks just a little bit sharper and thus a little bit more confident at work.

It was not fine, Jane. You basically lied to your husband. You told (or at least insinuated to) him that you picked up his brand of shampoo, but what was actually in the bottle was not his shampoo. That’s dishonesty, no matter what, and honesty is the foundation of any good marriage.

Which side is right? For me, it depends on how directly the husband avoided even trying the less-expensive shampoo. If Jane barely brought it up to him, this was the wrong move. If he just refused to try it without a rational reason, I’m much more sympathetic to Jane’s position – although it was not the most honest move, it may have been done in response to utter irrationality. I don’t think I would have ever done this, but I can at least understand it in the face of irrationality.

What do you think? Was Jane’s switcheroo ethical or not? It saved her family money, but it misrepresented the actual product to her husband. Of course, he didn’t even notice… but does that matter?

Of course, now that the die is cast, should Jane fess up? Obviously, the honest thing to do is to confess the switcheroo. Her husband might be pretty upset (after all, it is dishonesty), but he might also realize that, in fact, the shampoos are more or less interchangeable and be agreeable with sticking to the cheaper shampoo.

Not confessing the switcheroo is also an option, though. Jane could just continue refilling the bottle with the less expensive shampoo and sticking it in the shower without a word. If her husband is happy, she’s happy, and it’s saving the family real money over time.

Now that the damage is already done, I think Jane should ‘fess up. Telling her husband the truth might cause a short-term conflict, but it gets the relationship back on an honest bearing. Plus, the husband might realize that the cheap shampoo actually works pretty good and also be willing to try other low-cost options, which can really save the family some serious money.

What’s your take? Should Jane now ‘fess up? Or should she keep perpetuating the expensive shampoo mystique?

In a broader sense, do you think such secret substitutions are ethical? I don’t think they are, although I can at least sympathize with them in the face of a person who is irrational about at least trying generic products. What’s your take?

Many newer readers of The Simple Dollar haven’t been exposed to the hundreds of great articles in the archives of the site, so this is a weekly series that highlights the five best posts from one year ago this week, as well as the five best posts from two years ago this week. I call it … the Time Machine.

One Year Ago (October 11 – 17, 2008)
Minimizing the Impact of Job Loss: Short Term Tactics and Long Term Career Pillars The more “career pillars” you have, the more stable your career is. What are “career pillars” and how do you build them? This article explains it all.

18 Things a New Homeowner Should Do Immediately to Save Money Whenever you move into a new home, there are several little home maintenance tweaks that, if you do them right off the bat before you start moving stuff in, can be really easy to do and can save you quite a bit of money. Well worth reading if you’re about to move!

How to Plan Ahead for Next Week’s Meals (And Save Significant Money): A Step-By-Step Guide The more care we put into planning our meals in advance, the more money we save without reducing the quality of our meals. Naturally, there’s a balancing act between money and time, but our techniques balance things in a way that we’re happy with.

Money Podcasts: How to Listen to Personal Finance Commentary and Advice at Your Convenience These are the money podcasts I listened to about a year ago – the list slowly changes over time. All of these podcasts seem to still be going and all are excellent, however.

How Much Extra Should You Pay for Fuel Efficiency? Here’s How We’re Calculating It I’m a big believer that, if you own a car for a long time, fuel efficiency can greatly affect how much you should pay for the car. Here’s how we made that calculation when we were first shopping for a car.

Two Years Ago (October 11 – 17, 2007)
10 Simple Ways to Beat Impulse Buying Impulse buying is perhaps my greatest financial enemy. Here are ten techniques I use to avoid my worst financial impulses.

Dealing With Professional Exhaustion In A Financially Sensible Way Any time a person engages in a mentally or physically challenging career path, exhaustion eventually becomes a real danger. How can one deal with professional burnout without changing careers or going on a long sabbatical? Here are some approaches that seem to work.

Building A Personal Productivity And Development Library: What’s Essential, What Isn’t Here are some of the best personal development and productivity books I’ve read. Each of these books provided some sort of deep personal insight for me, helping me to improve my life in some fashion.

The Feeling You Get From A Coca-Cola Classic: How Advertising Tickles Your Wallet – And Five Ways To Fight It Advertisers use many, many tricks to convince you to buy their product. Here are some of the best techniques that they use and some ways to recognize the effect of advertising and not allow it to affect your spending.

Some Notes on the Environment: Why I Care And Why An Inconvenient Truth Doesn’t Matter Frugality and “going green” have a lot of overlap. While I do practice some environmentalism, I don’t worry about it in global terms. Instead, this is my argument for focusing on environmentalism locally – and how it can also benefit your wallet.

If you’d like to browse through more of the archives, visit the chronology, where all posts are listed in chronological order.

Nine Ways to Get More out of The Simple Dollar
This is kind of a FAQ for new readers and is posted each week along with the Time Machine. Here are nine great ways for new readers to dig deeper into The Simple Dollar.

1. Subscribe by email or RSS. Visiting The Simple Dollar’s website is great, but for many people, it’s more convenient to receive the articles in another form. It’s easy to join 60,000 other subscribers and get The Simple Dollar’s content by email or in your RSS feeder (if you’re unfamiliar with RSS, check out Google Reader.

2. Comment. Each article on The Simple Dollar has lively discussion. Just click on the green square in the upper right of each article on the website and join in!

3. Read my story of financial meltdown and recovery. The Simple Dollar isn’t based on what I’ve read in books or learned in school. I’ve made a lifetime of financial mistakes – The Simple Dollar is a record of what works for me during the process of getting my life on a better track.

4. Download my free 49 page e-book. Everything You Ever Really Needed to Know About Personal Finance On Just One Page is completely free. It summarizes all of the key lessons I’ve learned along the way about personal finance in one tidy package – in fact, all of the main principles can be found right on the cover.

5. Follow me on Twitter – or other social networks. I post tons of interesting articles, quotes, follow-up material, commentary, and other material on Twitter. Follow me! If you’re unfamiliar with Twitter, it’s essentially an open discussion forum for people to share ideas and thoughts with other like-minded folks – you just choose the people you want to listen to and their ideas and thoughts are all delivered to you on a single page.

I also participate on several other social networks. Feel free to check me out on del.icio.us (it’s where I collect links, from which I select the ones that appear in my weekly roundups), wakoopa (what software I use), GoodReads (what books I’m reading), Facebook, and FriendFeed (which aggregates everything). I also have an irregularly-updated personal site, TrentHamm.com.

6. Dig through “31 Days to Fix Your Finances.” 31 Days to Fix Your Finances is an article series that outlines how you can get a grip on your finances over the course of a month.

7. Send me your questions and suggestions. Send me an email and let me know what you’re thinking, what you’d like to see, and any questions you might have. I try to respond to as many emails as possible and I read them all. I may even use your question in a future article!

8. Become a “Friend of The Simple Dollar.” If you find the stuff on The Simple Dollar valuable and are willing to spend five minutes or so a month to help me out with small things, please consider signing up to be a “Friend of The Simple Dollar”.

9. Email a great article you find to a friend. Find an article that you think your friend would love? At the bottom of each article, you’ll find a link that says “Email this” – just click on that, type in your friend’s address, and send it right along to them!

This is the fourteenth of sixteen parts of a “book club” reading and discussion of Keith Ferrazzi and Tahl Raz’s Never Eat Alone, where this book on building a lifelong community of colleagues, contacts, friends, and mentors is teased apart and looked at in detail. This entry covers the twenty-seventh and twenty-eighth chapters – “Build It and They Will Come” and “Never Give in to Hubris” – which appear on pages 259 through 272.

One major challenge for many people is how exactly to find people to connect to. Many of the typical social methods people use to meet each other are shots in the dark, hoping that you find someone compatible.

Ferrazzi is a big proponent of clubs and community organizations. If you dig around, there are hundreds, perhaps even thousands of these in your local area, but many people never put in the footwork to find such organizations.

Over the years, I’ve been a member of many, many such groups, and I have to agree – they’re often useful in building relationships and providing a great way to spend time. In my experience, the best organizations are the ones that combine the camaraderie of a club with a natural passion that you already have.

Join a Club
Ferrazzi lays out the reasoning behind joining a club or organization on page 261:

All clubs are based on common interests. Members are united by a similar job, philosophy, hobby, neighborhood, or simply because they are the same race, religion, or generation. They are founded by a common proposition that is unique to them. They have, in other words, a reason to hang out together.

Take a look in the mirrow. Who are you? Where do you live? Where did you go to school? What do you believe in? The answers to these questions give you things that you have in common with other people, and this can often be the basis of participation in organizations.

Perhaps your school has an alumni association. Perhaps you’re a believer of a certain religion. Perhaps you engage in a particular hobby that others might share. Maybe you suffer from a certain medical condition, or have survived a certain social situation.

Whatever it is, there’s either an organization out there that will help you find people that you have something in common with or you can start such a group yourself. The people you meet will not only be easy to meet, but many will have social worlds that don’t overlap your own, giving you many opportunities to get to know people in different areas and stages and walks of life.

Bring Something Extra
On page 261, Ferrazzi talks about your unique selling proposition:

At a time like this, you have to figure out what is your U.S.P. – your “unique selling proposition,” for all you non-MBA types out there. What secret sauce can you bring to the table? Your proposition can be an expertise, a hobby, or even an interest or passion for a particular cause that will serve as the foundation from which an entire organization or club can be established.

When you join a club – or, especially, when you start your own – you need to bring something unique and interesting to the table or else you’ll just stand out. Perhaps it’s nothing more than a willingness to participate and take on the difficult tasks. Perhaps it’s a set of resources that you have that you can contribute to the group. Maybe it’s personal talent.

An example: when in college, I joined a computer group, where people would trade software and computer parts, build computers for people, and give each other advice. The group was somewhat anarchical, though, and the job of president – the person who had to interact with the college and arrange rooms for meetings and the like – was thankless, though people did appreciate that someone was willing to do it. For one (long) year, that was me. Because of that year, I built up several long-lasting friendships, resulting in two separate guests at my wedding a few years later.

Whatever it is, having that extra “something” will help you become an integral part of any group and make it possible for you to meet lots of people. Stand up, offer what you can, and good things will happen.

Clubs Aren’t for Rich White People
On page 263, Ferrazzi eschews the “rich white guys” notion of what a club is:

The days when clubs were only for wealthy white men to consort with people just like themselves are over. It doesn’t matter if it’s a group of carpet salespeople meeting weekly to discuss the trials and tribulations of their jobs; a roundtable of female Republicans who are dissatisfied with the stance of their state party; or a group who share a passion for great wines and who come together monthly to do tastings, hear vintners who are traveling through the area, and who plan an annual trip to Napa. Whatever it is and whoever you are doesn’t matter.

The idea that a “club” is just an exclusionary group of like-minded people who don’t want anyone else interfering in their ways died along with the pet rock. Sure, there are still a few such archaic groups around, but most groups simply aren’t like that, and if you use the fear of exclusion to keep you from dabbling your toes in the water, you’re making a big mistake.

The entire purpose of a group is to meet people that overlap in some demographic fashion, whether it be a hobby or a belief or a location or a political affiliation or something else. That overlap is the one thing that matters.

Yes, maybe some groups that seem like they would fit simply don’t fit, but it’s not because of exclusion. It’s usually because of personality clash.

The Value of a Club
The compelling reason for club membership is spelled out on page 264:

As long as it’s an association of people with shared interests meeting in a specified place (even if that place is cyberspace), you’ll benefit from belonging to something larger than yourself. You and your fellow members will be strengthened by a collective identity. And whereas with business, where boundaries of most relationships are clearly defined by a specific project or deal and end when that project or deal is done, membership in a club (preferably a club you’ve started) will lead to friendships that will last for years.

Being in a club means that you’re building a bond with other people that goes beyond the minutiae of the day. People come together in clubs because of common interests and beliefs and passions, not because they’re made to out of business or because it’s convenient.

That’s why clubs are often the best opportunity for building new friendships and connections in your area. The people in that room share something that transcends the ordinary. Often, they work together to build something even more interesting and exciting. That environment is the type of place where relationships and friendships thrive.

Take some time and find out what groups, clubs, and organizations are available in your area and give them a shot, whether it’s a book club at the library or a hunting club at the local range. Whatever it is, if it matches you, you’ll likely match it.

Momentum
Whenever people start building a lot of new relationships, these relationships often snowball. Friends will constantly introduce you to new friends, and so forth. Ferrazzi looks at this more deeply on page 268:

The pursuit of a powerful network of friends is not in and of itself a bad thing. But the closer you get to powerful people, the more powerful you tend to feel. There is a point where your reaching out to others will pick up momentum; one powerful contact will lead to another and then to the next. It can be a very fun and motivating and important ride.

At one point in my earlier career, I noticed that this very phenomenon happened to me. At one point, I completed a pretty substantial project and was able to share the results of that with a large number of people. Later, at a large conference (the first of its kind I had attended), I would meet up with these people and they were constantly introducing me to others. By the end of it, I knew many of the key people there, pushing one of my friends to comment that it sure didn’t seem like I was a first-timer.

If you provide something of value to others and make a sincere effort to befriend them, help them, and maintain a connection, they’ll remember you. When the time comes, they’ll introduce you to people they know and you’ll get to know new people. Eventually this will reach critical mass – people will talk positively about you when you’re not around, realizing that they have you in common, and this will often bolster your reputation strongly without any effort from you. You’ll get calls and messages out of the blue from people wanting to know you.

It’s awesome. It works. It really happens. But it requires being a sincere and helpful friend to a lot of people over a long period of time.

Vanity
Unfortunately, that kind of success can lead to vanity. On page 268:

Don’t let a little vanity seep into your actions or excite more expectations or create a deeper sense of entitlement. Don’t get your Ph. D. in master connecting, and then, for some reason, forget all the classes and values that were your foundation.

Everyone fails in life. What will you do when the phone calls that were once returned immediately no don’t even get a response?

It’s easy to think that you really are awesome and that a gravy train of success will keep on running. Inevitably, though, something happens. We all fail. We all do something we shouldn’t.

The end result of that is sometimes connections close right in your face, and often even a domino effect can occur as the story of your mistake spreads.

What happens then? You rely on your old friends, the ones who have been around for a long time. The only problem there is that if you’ve stopped being true to who you are, you’ve also stopped being true to them – and it’s likely they won’t be there for you.

If you begin to think you’re better than people you once thought of as a valuable equal, it will eventually backfire on your face. Remain humble, and remember who your truest friends are and the values that helped you to start opening the doors in the first place. If you stick to those values and beliefs, you’ll do all right.

On Wednesday, we’ll tackle the twenty-ninth and thirtieth chapters – “Find Mentors, Find Mentees, Repeat” and “Balance is B.S.”

One of my favorite parts of being frugal is that I often go shopping at thrift stores. Thrift stores are unusual places. They’re often just collections of the stuff that well-off people no longer want to have or to deal with, so they just drop it off at Goodwill. That means there’s usually a lot of interesting stuff in there – and, fairly often, some hidden gems.

I thought I’d share some of my best thrift store finds (spurred on by a couple of recent finds) and encourage you, the reader, to share your own. Perhaps this will convince a few of you who are thinking about diving into thrift shopping to go ahead and give it a shot. Trust me – thrift and secondhand stores contain some of the best bargains on earth.

A full winter wardrobe About three years ago, I went into a thrift store looking for long-sleeved shirts for winter. I’m a very big guy, often wearing 2XLT shirts, so I love it when I can find a high quality shirt that fits at a thrift store for a few bucks.

That day, though, I was in luck.

There was an elderly worker in the store putting clothes onto hangers and sticking them onto racks. I walked in and started riffing through the men’s shirts. She looked at me and said, “Excuse me, sir? We just got in a bunch of shirts that must have come from a very large man. Would you like to see them?”

She motioned for me to follow and took me in the back. There was an enormous pile of almost-unworn sweatshirts, long sleeved tee shirts, and dress shirts, all 2XLT and 3XLT in size. I wanted pretty much all of them, so I asked about prices (as they hadn’t been priced yet).

The woman didn’t know for sure and made a phone call, but whoever she called didn’t seem to know, either. So she went out in the store and found a rather raggedy large shirt marked $2. She turned to me and said, “$2 each.”

I was stunned. This was really high quality stuff – Harbor Bay and the like. I bought almost all of the clothes in that batch for about $50.

Three winters later, I’ve still got shirts from that batch that have barely been worn. I won’t need to buy any more long-sleeved shirts for several years yet. Not only that, most of the stuff is nice enough that it actually draws compliments from people.

Now that’s a bargain!

An out-of-print surprise When I was in college, I used to play the game Netrunner fairly often. Netrunner is a card game that requires quite a bit of orderly thought. The game went out of print in 1996 and then, in about 2000 or so, I accidentally ruined my Netrunner cards, rendering it impossible for me to ever use the cards. Since it was so long out of print, I figured I’d never play it again.

Flash forward to about a week ago. After a doctor’s checkup, I stopped at a local thrift store, looking for some long-sleeved shirts that were in good shape and would fit me – occasionally, I’m pretty lucky in this regard. In the back of the store, though, in a glass case, I found a gem.

Sitting there, still in the shrinkwrap, was a Netrunner starter set. The price tag? $3.

I don’t think $3 has ever put that big of a smile on my face.

An emergency fix One time, almost a decade ago, I was on my way to work about 9 in the morning. It was early spring, so I had pulled out my bicycle for the first time and taken off on it.

Well, after about two blocks, I began to realize that the tires were desperately low on air, so I stopped to consider my options. I was in a light commercial area, but there were no gas stations nearby. To put it simply, I was in a bit of a pickle.

I went over to the strip mall area to look around for some assistance and stopped into a thrift shop. This was in the days before everyone had a cell phone, so I asked the person behind the counter if I could make a local call. I called my work and told them I would be late because my bicycle was having issues and I’d have to walk the rest of the way.

As I hung up, the person behind the counter said, “I think we have a bicycle pump.” We went looking for it and found it, near the back. It had a price tag of $2. I emptied out my pockets and found $1.75 in quarters. The lady laughed and called it good enough. I walked outside with my pump, pumped up my tire, and I was on my way.

What are your great thrift store stories? Share ‘em in the comments!

A couple days ago at the doctor’s office, I picked up the newest issue of Time, which featured a cover story entitled “Why It’s Time to Retire the 401(k)” (and you can read the article online).

The article was filled with lots of stories about individuals close to retirement age who lost a large portion of their retirement savings in the stock market market downturn of 2008, including some who were forced to return to work. The article concluded that the 401(k) system is thus broken, since it’s letting down the people who rely on it.

Here’s the problem, though: 401(k)’s aren’t at fault. Personal responsibility (or a lack thereof) is.

A 401(k) plan is basically just an investment opportunity where employees can put in their money before taxes, then pay income taxes when the money is withdrawn much later in life. While the money is inside the account, account holders have a wide array of investment options. Some of them are very stock heavy and, yes, include a lot of risk; others are more diverse and offer lower risk. The choice of options is left up to the individual investor.

In the end, the investors who suffered a disastrous, life-altering 2008 in their 401(k) accounts were either contributing too little and essentially gambling with it or they didn’t bother to learn or understand how investing works.

A stock fund with a 10% annual return is not a guarantee of a 10% return each year. Minimal reading and investigation into investing reveals this to be true. Thus, if you need that balance to be there for you, you shouldn’t have it in stocks.

Some of the people who are suffering right now were not aware of this fact. They either didn’t bother to investigate their investments further or they simply chose not to think about it at all.

In either case, they chose to invest their future into something that they didn’t fully understand. That’s an incredibly dangerous individual choice.

And, honestly, my sympathy for them is somewhat limited. To build up the large balances that they had in their 401(k)s requires years and years of regular, steady investment – a substantial portion of the financial output of their life’s work. Yet, in many cases, the investors never bothered to truly learn about their investments or make any effort to diversify, using other funds or balancing things out with a conservatively-invested Roth IRA.

There’s a lesson to be learned here. Know where your money is going. Know where your investments are placed. If you can’t afford to take a loss on that money, move the money to something safe, like bonds or treasury notes. If you’re young and have many years until retirement, carefully investigate your options and know that investments in stocks will go up rapidly and down rapidly over and over again with, over the long term, a general upwards trend that will usually beat more conservative choices.

Should special help be given to people who have to re-enter the workforce because their 401(k) didn’t hold up? No. They made the personal choice to expose their investment to a lot of risk when they most needed it. If you argue that they didn’t know, I say that they didn’t bother to educate themselves about the very investment that’s supporting their entire lifestyle – another personal choice.

401(k)s are not the magic answer to retirement problems. They’re a tool, one that requires careful reading of the instruction booklet to use properly. And this time, you need to read the instructions, because if you use this tool wrong, you can cut years of healthy, happy retirement living out of your life.