Over the past few weeks, I’ve heard this question several times from various people who find me on their Christmas gift list this year. I’m guessing they’re all thinking more or less the same thing: what do you get for a guy who doesn’t really want anything? So they ask me, and then I’m left with that difficult question to answer.

Frugal people are often the hardest to buy winning gifts for. Quite often, frugal people don’t want things that don’t have obvious utility or that don’t match their tastes well – it’s just “stuff” that takes up space. At the same time, they don’t often go for the obvious gift stuff, either – they really don’t need another tie or so on.

So what’s a person to do if they’re going to buy a gift for a frugal person? At the same time, what kind of sane answer can I give in response to that question?

Over the last few years, these questions have confronted me face to face many times. After some careful consideration (both for my own purposes and for The Simple Dollar), I’ve come up with a handful of general guidelines that will help in purchasing gifts for any frugal person – or might help a frugal person come up with gift ideas.

Focus on core passions. Get to know the person you’re buying for. What are they passionate about? What do they spend their free time doing? For me, the answers are pretty easy – I read, I write, I cook, and I play games with friends. So, for me, books are a good idea, as are nice notebooks. Good kitchen items are good, as are quality food items (like great cheeses). Board games are also good.

If you don’t know what specific item to get, get a passion-focused gift card or gift certificate. For example, a gift card for me to Barnes and Noble or Williams-Sonoma or Funagain Games wouldn’t be a bad idea. Why? This lets the person indulge in what they’re passionate about without feeling guilty about spending their hard-earned money on something extraneous.

Buy a single quality item instead of several of lower quality. Frugal people value things that are well-made and that will stand the test of time. Get a frugal person one good gift instead of three low-quality ones. Get them one good knife instead of a block of mediocre ones.

Consumables usually work. If you know a frugal person who likes chocolate, get that person a few bars of really good chocolate. If you know a frugal person who likes cheese, get them a chunk of Maytag Blue. If you’re gifting a beer loving frugal person, get a six pack from your local microbrewery – or if the person likes wine, go to a local winemaker.

A high quality food item in line with their tastes is usually quite enjoyed for several reasons. For one, it’s an indulgence they would likely not spend their money on. For another, it’s not yet another item that takes up space in their home because it’s consumed.

Avoid stuff that isn’t obviously useful or isn’t in line with their core values. Frugal people are often utilitarians, which means they don’t see great value in items that don’t fulfill a specific need or a specific use in their life. Avoid the kinds of gifts that rely heavily on aesthetic appeal unless you intimately know their aesthetics. If you miss their aesthetics, you’re just going to give them a gift that frustrates them.

In general, these are good gift-giving strategies for most people. The real core of the message here is to simply put a bit of thought into the gifts you give. “It’s the thought that counts” is often said tritely, but it’s really true: a little thought at gift-giving time goes a long way.

By this time next week, most Americans will have gathered with friends and family and eaten the traditional Thanksgiving meal. I’ll be gathering for three separate Thanksgiving dinners during this holiday weekend.

Quite often, I’ll see people spend exorbitant amounts of money on lavish Thanksgiving spreads. While I completely understand the reason for doing this – often, it’s the one time in the year that we can gather around one table with a lot of people we love – there’s still a lot of simple things we can do to reduce the financial outlay and the stress of the meal without reducing the quality of the day in any way (and often improving it). Here are ten ways to do just that.

Cook and slice the turkey on Tuesday. What? No beautiful turkey on the table? Whatever will we do? In truth, though, the turkey on the table during Thanksgiving dinner often results in lots of problems: it keeps someone away from the meal because they’re carving the bird, the bird is often dry because it hasn’t had a lot of time to rest, and the finished bird often arrives later than expected, delaying the whole meal and often reducing the quality of the other food. Solve all of these problems by cooking the bird on Tuesday or Wednesday, slicing it at your own pace, then putting all of the meat on a platter along with all of the juice and a few pats of butter. Cover the serving platter and put it in the fridge, then just turn on the oven (or the electric roaster) on Thanksgiving to thoroughly warm the meat.

Use nature for your decorations. During the weeks leading up to Thanksgiving, there are thousands of colorful leaves all over the place, free for the taking. Be picky – go outside and look for some nice, clean, colorful leaves. All you need is a plain tablecloth and a row of colorful leaves sprinkled down the middle to create a very festive setting.

Get the slow cooker into the act. Many Thanksgiving side dishes can easily be prepared in a slow cooker. Slow cookers consume less energy and quite often can be used in a “fix-it-and-forget-it” mindset. It’s the perfect tool to make cranberry sauce, for example.

Be creative with your Thanksgiving dinner leftovers. By the third day, turkey sandwiches start to get tired. Instead of allowing that to happen, share some of your extra food with people in need (for example, make a couple plates of food for shut-ins you know and deliver the plates) or make something interesting, like kugel or tetrazzini, out of the leftovers.

Round up when you estimate. I’ve been to two different Thanksgiving dinners in the past three years where there was just barely enough food to make ends meet for the number of guests (to put it politely). People showed up bringing unexpected dining companions and estimates for how much each person would eat were strangely low. Don’t fall into that trap. Estimate high, but estimate realistic. After all, you can always eat leftovers, but you can’t undo unhappy guests.

Don’t be afraid of potlucking it. Ask your guests to bring a dish or two with them so that you can focus your time, energy, and money on a few key dishes. Most people are quite willing to help (provided, of course, that they’re not coming from out of town).

Save the bones. Seriously. Put the entire carcass in a large Ziploc bag and save the bones and small pieces of meat for a day or two. Then, take all of the leftover vegetables (potatoes, corn, non-glazed carrots, etc.) and the carcass, stick them all in a crock pot, then add enough water to just cover the bones. Turn it on low overnight (this is perfect to do on Saturday evening after Thanksgiving). Then, in the morning, save the liquid. What will you do with this delicious turkey broth? Freeze it (along with a pound or two of leftover diced turkey meat). Then, in a few weeks, use it as the base for an amazing soup – just add vegetables and/or dumplings to the stock and the turkey (along with perhaps a bit of water to thin it).

Have appetizers. Inexpensive appetizers – like a selection of vegetables – helps people keep the edge off of their appetites and keeps them from over-eating during the main meal. Not only does this make the overall meal more healthy, it often makes it cheaper, since a vegetable tray can be really inexpensive. Much like the turkey, this can also be assembled the day before.

Don’t try to “impress” with your wine. There are countless great wines under $10 (here are five of my favorites from a few years back). Don’t feel the need to buy an expensive bottle of wine to impress anyone. Just stop by your local wine and liquor store and ask for a low-cost full bodied wine for the Thanksgiving table. They’ll be happy to point out something great for you.

Save your recyclable containers for leftovers. Instead of just tossing large containers of items like margarine or whipped topping, save the containers. Then, on Thanksgiving, fill the containers with leftovers and give them to your guests. There’s no responsibility at all for them to return the container and it gets an extra use out of the items that would normally be tossed.

Recently, I was reading a great article at The 99 Percent entitled The 40-30-30 Rule: Why Risk Is Worth It. I originally intended to include it in my weekly roundup, but as I thought about the 40-30-30 idea, I found that the connections to careers, personal finance, and life were profound.

What is the 40-30-30 rule? Simply put, it’s an argument that when you prepare for anything in life, only 40% of the preparation is physical – the rest is mental. Thirty percent of preparation is technical skill and experience, and the second thirty percent is the willingness to take risks.

This “rule” comes up again and again in all different areas of life. Here are several examples from my own life where I’ve seen it.

When I’m playing a game I’ve played a lot of times before, I have an intuition as to what move to make next, built from years and years of experience (the 30% that comes from technical skill and experience). However, I also find that it’s very easy to just keep using the same strategy over and over again because I’ve somehow come to the conclusion that it’s the best one. So, if I combine that technical skill and experience with a risky new strategy I’ve devised (the other 30%), I might lose – but I might also devise a way of playing that’s even better.

With investing, I have a good understanding of my own risk tolerance, an understanding built up over a long period of time (the 30% that comes from experience). Howver, I also know that if I don’t push against my risk tolerance a bit and look at new investment opportunities from time to time (the other 30%, risk), I’ll likely miss out on great opportunities.

I also see it in my career, both now and when I worked for a large organization. I would often have a well-worn daily routine that worked and got the things done that I needed to get done (the 30% that comes from experience), but if I really want to excel, I sometimes have to step outside the box a little (the risk-based 30%).

The 40/30/30 rule really does provide a great framework for success, no matter what you do.

Do something worthwhile (the first 40%) means that you’re willing to get up off the couch and do something. Maybe it’s getting ahead in a career. Maybe it’s getting into a new hobby. Maybe it’s simply getting a grip on your investments. 40% of the journey is simply trying.

Keep at it (the next 30%) is simply encouragement to not let a new initiative slide, because the more you work at it, the easier it becomes. Even more important, the more you work at it, the more the basic skills that make up the task begin to become natural to you.

Take risks (the final 30%) simply means to not do things the same way every single time. When you’ve become skilled at something, it’s easy to become wedded to the same routine. Never stop looking at what you do and trying out alternate paths. Not only does this grow your skills (making your basic routine even better), it also helps you to uncover new ways of doing things.

Great… so how do you do this? How can you apply the 40/30/30 rule in your life? The best first step is to figure out the area of your life where you want to improve. Do you want to get out of debt? Do you want to improve your skill at a musical instrument? Do you want to get a promotion at work? Do you want to become a writer?

Once you’ve figured out what you want to do, research it a bit. Figure out what things you’ll need to do to accomplish that goal.

After that, start practicing and building skills. The best way to do that is to start doing the thing you want to master every single day. For me, a thirty day project works well for this. I just commit to doing a certain thing every single day for thirty days (if that’s possible). At the end of it, I’ve usually vastly improved at whatever skill or attribute I was trying to develop.

Quite often, thirty days is enough to establish a positive new routine in your life, so keep it up. Keep doing that thing every day until it becomes truly normal and seemingly effortless.

Then, take a risk. Change what you’re doing a bit. Make it more difficult, or at least different. Explore something new. If you’re taking a walk every day, increase your walking pace a bit and use a stopwatch to slowly trim your time around the block. If you’re trying to break through at work, volunteer for a task that you might have avoided before, like giving a presentation. If you’re playing a game, try a completely different strategy and see how it works. If you’re investing, dig into some new investments that you haven’t looked at before and consider putting some money into them after you’ve studied them.

What you’ll find is that your already-built skill will help carry you through this new challenge and that the rewards of this new risk are great. You end up in better shape, with a better career, with a better gaming experience, and with better investments – or with improvement in anything you’d like to take on in life.

Whenever a personal finance writer – or a writer of any kind – wants to make a bold, shocking point, they’ll often pull out an “average” of some set of numbers. That average, when read without further investigation, is often really shocking. Could that really be true? Here are some examples.

The average square footage of single-family homes under construction fell dramatically, from 2,629 in the second quarter to 2,343 in the fourth quarter. (from USA Today)

The average credit card debt per household — regardless of whether they have a credit card or not — was $8,329 at the end of 2008. (CreditCards.com statistics)

The average 401(k) fell 27% in 2008. (MSN MoneyCentral)

Those numbers seem fantastic. I grew up in a home that had about 800 square feet and currently live in a home that feels huge to me at times and is just shy of 2,000 square feet. The average home has over $8,000 in credit card debt? That’s well over $100 a month just in interest!

However, if you start teasing those numbers apart a little, a few interesting truths reveal themselves.

Let’s look at the first one. The average new home has 2,343 square feet in floor space. Well, let’s assume that one in five homes is a 7,000 square foot McMansion. That means that four out of five newly built homes are just 1,200 square feet. In other words, if you lined up all of the houses that were built in the last year side by side ranked by their size and chose the one in the middle, it would be far less than 2,400 square feet.

How about the average credit card debt? Again, the huge ones skew the average. If you have three homes with no credit card debt, one with $10,000 in credit card debt, and one with $30,000 in credit card debt, the average credit card debt of those homes is $8,000 even though three out of five of the homes have no debt at all. The facts back this up – the majority of American homes carry no credit card debt.

That third one is also interesting. The average 401(k) fell 27% in 2008, yet the stock market (as judged by the S&P 500) dropped 37%. What does that mean? Lots of investors out there didn’t have all of their eggs in the stock market basket.

Whenever you hear a news report or read an article where someone quotes an average, you should get your guard up because there’s a solid chance that a skewed story is being presented.

How is it skewed? Quite often, when we hear “average,” we compare our situation to that number. Yet, as we’ve seen above, the vast majority of people are often well under (or in some cases over) that average. That average is misleading, and if we compare our own situation to that average and use it as guidance for moving forward, we can often mislead ourselves.

How can you figure out the real story? One big first step is to look at the exceptional people on either end. Take the house square footage example. The biggest houses built would be over 10,000 feet, while the smallest ones would be around 1,000 square feet. Then, look at the average. The end that the average is closest to is where most of the people actually are. After all, if there are 9 people building 1,000 square foot homes and 1 person building an 11,000 square foot home, the average is a 2,000 square foot home – but none of them are actually building a 2,000 square foot home.

Good luck.

Andre writes in:

I’m interested in replacing a piece of home audio equipment that is experiencing occasional malfunctions, but works OK most of the time. The receiver I’m looking at costs $500 on Amazon. I’m a little conflicted. The more frugal side of me says to not even buy it. Make do with the broken receiver until it’s completely unusable. The less frugal side says to save up for it and buy a new one. That sounds perfectly logical and responsible. Save for a few months, instead of putting it on my credit card. The receiver I’m looking at is highly-rated and is considered a great buy for the price, according to CNet. I’ve done research and think this is a good value for what I’m getting, compared to other similar items. I feel like I’ve done everything right but still feel a little guilty in thinking of buying it.

This is one of the biggest challenges for a frugal person. When is it appropriate to just “make do” with what we have on hand, and when should we bite the bullet and buy a replacement? And when we do, is it appropriate to buy a high-end replacement, or should we just go for the best bang for the buck every time?

I think both questions come down to the same key factor: how truly important is this item to your quality of life?

Let’s look at Andre’s case. Let’s say Andre is a serious audiophile. Every evening when he comes home from work, he puts on a series of jazz albums that play all evening at his house while he reads, works on personal projects, and does housework. Perhaps Andre is even a musician himself. The music is one of his biggest passions in life – he can’t imagine an evening without that soundtrack to his life playing.

If that’s the case, Andre should maintain his home audio equipment. He should save up for that replacement component and he should buy a high-quality one that meets his needs.

On the other hand, let’s say Andre listens to his audio system once a week at most. He turns it on when there are guests over and perhaps he’ll turn it on on a lazy Saturday afternoon, but other than that, it sits there silent. He enjoys music, but it’s not his life’s passion.

If that’s the case for Andre, he should make do with what he has and, when it breaks, get a “bang for the buck” replacement for it.

I think this is largely true for everything in life. All of us have a few key central passions. Once you know what those passions are, it’s completely fine to spend a little more on it, provided you can afford it and can save for it.

The problem with overspending comes in when we begin to overspend on areas that are less important to us. For example, if Andre wasn’t passionate about music but he still convinced himself to drop hundreds/thousands of dollars on his home audio system, that’s probably a misuse of money. If he’s not deeply in love with the driving experience, dropping thousands extra on a luxury car probably isn’t a good use of money.

I’ll use myself as an example. I’m passionate about cooking at home. A big part of that for me is getting great, fresh ingredients. Thus, I’m willing to spend quite a bit more to get great ingredients. I don’t feel bad when I spend $30 on cheeses or I buy organic fresh produce or when I replace the old casserole I had in college with a top-notch French oven.

On the other hand, I don’t value having a perfect living room set. I’m more interested in something that’s simply comfortable. So I don’t go out and spend a ton of money replacing our living room set all of the time. It’s just not something I value beyond the minimum function of it.

In the end, I have about three or four key passions in my life that I don’t feel bad spending money on if I can afford it easily. Outside of those passions, I’m as tight as a drum.

Andre, the answer to this question really comes from you. How much do you value the audio listening experience? Is it something that’s central in your life, or is it just something on the periphery? That alone will provide the guidance you need.

For the longest time, I didn’t really see the point of taking home movies. I would take some because I’d be encouraged to do so, but they always seemed to just wind up in boxes collecting dust somewhere.

Until last night.

I was digging through one of our closets and came up with a few tapes depicting the day our son was born, his first Christmas, and some other moments from early in his life. We watched them together and he really enjoyed them. He had tons and tons of questions about what was going on and we had to pause it several times to talk about things.

Home movies seem pretty useless when you take them, but they can sure create a magical evening a few years later.

The Science of Success Science is beginning to show beyond a doubt that genes have a huge effect on positive traits in people. Even more interesting, it benefits us to interact with people who are wired differently than us. (@ the atlantic)

11 Steps in Becoming Educated for Your Dream Job These steps can really be boiled down to one thing: push yourself in your education every chance you get. Choose the hard classes. Choose the hard school. A hard-earned C teaches you far more than an easy A. (@ productivity 501)

Slow and Steady Wins the Race The biggest challenge of personal finance is the battle with patience. Patience is hugely rewarded when it comes to personal money management, but many people simply don’t have it. (@ get rich slowly)

Some Counterintuitive Facts about Loneliness If you work in a job where you’re alone much of the time, these are some very important facts to keep in mind. (@ the happiness project)

The Cost of Money People often make some very unusual sacrifices in the name of a bit more money. (@ free money finance)

I really enjoy visiting garage sales, yard sales, and thrift stores. I almost always find an item or two that I’m either looking for myself or I’m sure I can sell on eBay for a small profit. Plus, I’m always amazed at the things other people have largely decided to throw out.

Whenever I head out for a few hours of visiting yard sales and thrift stores, I take my backpack along with me. I usually have several items in it that help immensely with a big day of yard sales and thrifting. Here’s what I pack.

A list of thrift stores and yard sales. I’ll usually check the local newspapers a day or two before I plan on heading out to see where the sales are going to be. I make a list of those sales. I also usually make a list of local thrift stores, but I pretty much know where they all are within a twenty five mile radius, so that’s reached the point of being unnecessary.

A map and/or a GPS unit. Just because I have an address of a yard sale two towns over doesn’t mean I know exactly where that is. A local map can help somewhat, but I’ve found that the GPS is even more useful. I simply punch in the address and go. Quite often, I’ll punch in all of the unknown addresses the night before so that I can just click a button or two and go when I’m out and about the next day.

A simple meal. A sandwich, a few vegetables, and a few bottles of water take care of any food or rehydration needs I’ll have when I’m out. This way, I’m not tempted to overpay for some unhealthy food on the go, which would pretty much undermine any benefit of hitting thrift stores or yard sales.

Cash. Yard sales usually operate on a cash-only basis (and thrift stores are quite happy to take cash). Thus, when I’m out, I do my shopping on a cash-only basis. Part of that means making sure that I have an adequate amount of cash on hand before I leave to cover anything I might possibly buy.

Sizes. What size clothes does my wife wear? My kids? Me, for that matter? I make sure to have them all written down so that I can easily identify clothes that would fit each of them.

A list, along with certain measurements. Are there any particular items I’m looking for? Sometimes there is, sometimes there isn’t. When there is, I make a list of those items so I don’t forget. For example, if we need boy’s shirts, I’ll write that down. Also, if I’m looking for items of a particular size – like a desk, for example – I’ll measure the desired dimensions of the desk and write those down.

A tape measure. If I’m going to be measuring an item – like a desk – I need to have something to measure it with. A tape measure is perfect for that task.

A notebook. I usually have this on hand anyway because I always carry a pocket notebook with me. However, if I spy something interesting at a yard sale but I don’t know if I need it or not, I’ll make a note of it, go home, and check. Sometimes I’ll even return to the yard sale to pick it up.

A rope or short bungie cord. Yes, every once in a while, something comes along that’s just too big to fit properly in a car trunk. In those cases, you might have to tie it down for the drive home. That’s why it’s handy to have a rope and/or a bungie cord on hand to secure the item.

All of this stuff fits easily in a backpack and can be packed the night before (excepting the food, of course). Going prepared makes it much more likely you’ll find the things you actually need when you go thrift store and/or garage and yard sale shopping.

Good luck!

Recently, my son Joe had his fourth birthday. Sarah and I had made the decision that we were going to introduce the idea of an allowance to him after his fourth birthday, along with the idea of saving for specific goals.

In order to accomplish this goal, we decided to get him a Money Savvy Pig for his fourth birthday. Here’s the happy birthday boy with his pig (and an over-the-top goofy grin):

What is a “Money Savvy Pig”?
As you can see from the picture above, a Money Savvy Pig is a bank with four distinct compartments: Save, Spend, Donate, and Invest. The bank has four slots along the top – one for each compartment – and each of the pig’s feet provides access to one of the chambers to empty it individually.

The idea behind it is pretty simple – it makes it very easy and tangible for children to separate (and effectively budget) their money.

How We’re Using It
Each week, we’re giving him $2 in quarters for his allowance – $0.50 for each year he’s been alive. Thus, next year, he’ll get $2.50. We may at some point in the future change this rate, but it works for the time being.

He then splits the money into four roughly equal amounts. Two quarters go in the “Spend” slot, two quarters go in the “Save” slot, two quarters go in the “Donate” slot, and two quarters go in the “Invest” slot.

He is completely free to spend all money that goes in the “Spend” slot as he wishes. If he wants, he can take that money and put it in the other slots in his bank, or he can put it in his pocket and take it to the store with him to buy something small.

With the “Save” slot, we had him identify something that he wanted that was much more expensive than a dollar or two. We told him to think about it and later he told us he was saving for a Batman action figure that costs about $10. So, we told him that he could keep adding to the “Save” slot and in a few weeks, we’ll count it up and see how close he is to it.

With the other two slots, we told him that for now, they’re going to just build up.

For the “Donate” slot, we’re talking right now about the various things that people can donate money to – the local church, the local food pantry where people who don’t have much money can get food, Heifer International, PBS, and so on. We told him that when he gets $5 in that slot, he can pick something to donate to. He has expressed positive interest in donating to PBS, so I more or less expect that to be his first donation in two months or so.

For the “Invest” slot, we’ve told him that it’s just going to build up for a while. Our plan with that is to wait until there’s a “lot” of money in it (from his perspective). Then we’ll use that money to introduce various ways to invest, starting with a savings account at the local bank.

Does a Four Year Old Understand All of That?
No, nor do I expect him to.

We’ve started doing this when he’s young so that saving seems like a completely natural thing to him as he becomes more aware of money and how a person can use it.

I don’t expect him to fully understand, and he doesn’t. For now, he really only understands the “spend” part and the “save” part of the bank – the other two are mysterious.

We are quite sure he understands the “save” slot. We told him that he’s free to put any money he gets as a gift into any slots he wishes and he chose to put almost all of it into the “save” slot because he wants the Batman action figure that he had chosen as a goal. He put a smaller portion of it in the “spend” slot and a bit each in the “invest” and “donate” slots.

We’re also quite sure he understands the “spend” slot, since he wanted to take a dollar out of it a couple of days ago to buy a Hot Wheels car for the race track his grandparents gave him for his birthday. We, of course, approved this, since it’s money he can spend as he chooses.

The other slots are a mystery at this point – they’re clearly there for him to grow into it.

What About Sibling Rivalry?
Joe has a two year old sister who loves to do exactly what her big brother is doing. So how are we handling that? We decided to start her on an allowance, too, but a much simpler setup is in the offing for her.

For her, we’re just giving her four quarters on allowance day (again, fifty cents for each year) and allowing her to put it in her bank. We don’t have any rules on how she can use it, but for now they’re really not needed. She simply enjoys putting “monies” in her bank, just like her big brother.

When she’s four, if Joe is seeing success with his bank and we’ve seen it as a valuable tool, we’ll get her one, too.

One big reason for doing this is the idea of peer reinforcement. If they’re both saving together, it seems more normal. It isn’t just them doing it – one of their peers is saving, too.