Each week, I’ll present a low-cost meal (or a meal that demonstrates a lot of options for cutting costs) that my family eats for dinner and enjoys. Many of the recipes will be vegan or vegetarian, with options to add other ingredients for non-vegetarians.

In the past, I’ve created a lot of photo-heavy posts about preparing frugal meals and, since then, a steady flow of readers have emailed me asking for more low-cost recipes. That’s something I can certainly do, so for the time being, I’m going to have a weekly series on The Simple Dollar featuring such meals. I’ll be calling it “Dinner with My Family.”

The challenge with doing this is that in October, I switched to a (mostly) vegan diet for health reasons, the only exception to that being that on occasion (once a week at most), I can have a piece of fish with my meal. I know quite well that most of you are not vegan, so I’ll be trying to choose adaptable recipes as well, ones that can easily be transformed with the addition of a few ingredients.

Many of the recipes in my recipe box are handwritten and without source. If I can find a source for a recipe, I’ll provide it.

So, what’s on the table this week?

Last night, we had a vegetable barley soup, accompanied with fresh bread. The soup was actually thicker than expected and wound up approaching a stew-like consistency, but it was still flavorful. Every member of our family (over the age of one) cleaned their bowls, which is pretty much all you can ask for. It is a perfect recipe for a lazy winter Sunday afternoon around the house.

This was a handwritten recipe, but it seems to be pretty similar to this recipe for “Granny’s Vegetable Barley Soup.”

What You Need
The ingredients are pretty straightforward:

1 onion, diced
1/2 head of celery (including leaves), chopped
1 1/2 tablespoons oil
3 quarts vegetable stock (water can be a substitute, but the soup will be thinner)
1 1/4 cup barley
1 bay leaf
2 medium potatoes or one large potato, chopped
2 carrots, chopped
1 large can diced tomatoes (28-30 ounces)
1 1/2 cups greens (kale, collard, spinach – whatever’s on sale), chopped
1 teaspoon dried basil
Salt and pepper to taste

Since we already had vegetable stock on hand (here’s how to make your own), all we really needed was a visit to the produce section of our local grocery store. Our total cost for the other ingredients was $8.98. This ended up making enough soup for three meals for all four of us, reducing the cost per meal well under $1.

The bakery had an amazing sale on fresh loaves of bread straight out of the oven – $0.99. I had planned to make my own bread, which usually comes out to a slightly lower cost per loaf.

The Night Before (or Early That Day)
You’ll obviously have to do a lot of chopping. Dice the onion and chop the celery – you can store them together in a bowl. Chop the potatoes and carrots – you can store them together, too. Also, chop up the greens. In the end, you’ll have three bowls of chopped ingredients. This will make the actual preparation of the meal very simple, and you can do this the night before if you wish.

Don’t throw away your vegetable scraps. Instead, save them in a container and keep them in the freezer. When you accumulate several cups of scraps (yes, potato peels, carrot peels, the ends of carrots, all of that stuff is okay), you can make delicious vegetable stock with those scraps.

Preparing the Meal
Put the onion, the celery, and the oil together in your soup pot, then turn the heat up high. Your goal is to brown the onions a bit until they take on that wonderful caramelized look and smell.

This process will take five to ten minutes. Once the onions are looking tasty and brown, add the stock/water and the bay leaf. As the liquid is heating up, rinse off the barley, then add it to the soup.

Your goal is to get the soup to a simmer – barely boiling. You’ll want to stir it regularly.

Key point Different types of barley have different cooking times. Read the barley package you have and see how long it suggests for cooking. Subtract an hour from that, then let the soup simmer that long before proceeding to the next step. This might be fifteen minutes or it might be an hour or it might be anything in between.

At the “one hour remaining” mark, add the tomatoes, the potatoes, and the carrots to the soup. You’ll now let this simmer for an hour, stirring regularly.

The picture above shows what it looks like as it nears the finish line. We threw in a bit of extra barley, so ours is a bit thicker than yours might be. Another thing to note is that the color will vary somewhat based on the color of your stock, the color of the tomatoes, and so on.

You’ll want to be preparing the bread at this time. We like crusty bread, so we tossed our bread in the oven for another ten minutes before slicing it.

When the time is up, add the greens and the basil, stir them in, and let it simmer for five minutes more. Set the table, then put out the cauldron of soup for everyone to enjoy!

Optional Ingredients
If you’re looking for non-vegan ways to alter this meal, here are some suggestions.

Ham This is a perfect soup for some diced ham. I would put the ham in when I put in the barley, to let the flavors spread throughout the soup. If you have a ham bone, don’t be afraid to drop that in there, either. This would be my preferred option.

Ground beef or ground sausage I would cook this separately, then strain it very well before adding it. Adding fatty meats to soups can often make the entire soup taste fatty.

Beef bullion If you’re adding ground beef to the soup, you could use beef stock or beef bullion instead of the vegetable stock or water. This would make more of a beef barley soup.

This year for Christmas, most of the items my wife and I received were small and/or served some specific utility in our lives. I received some grape juice with which to make homemade wine (pinot noir), a replacement for our small saucepan, and some books (among other things). My wife received similar small items.

Our kids? Not so much.

Here’s the challenge with our children. My parents have traditionally gone way overboard on all of their grandchildren for birthdays and Christmas. On the other side of the family tree, our children are the first grandchildren of my mother- and father-in-law, and the first nieces and nephews of my sisters-in-law.

They all want to give our children memorable Christmas presents – and, frankly, I completely understand that. Our challenge comes in when we return home with all of these gifts and wonder where we’re going to put them all. They fill up multiple toyboxes and spread across the living room. The vast, vast majority of them are gifts from various events – birthdays and Christmases, mostly.

There’s a double challenge here.

The first challenge is simply finding the places to store these things. Our children are of three distinctly different ages and levels of cognitive development. Our oldest loves playing and building Lego sets, for example, and has a penchant for action figures. Our middle child loves building towers out of Magna-Tiles. Our youngest? He’s pretty content with a few stuffed animals and baby toys. As they grow, though, their interests change. Soon, our youngest will want to have his hand in the Magna-Tiles. And what if we have another child?

The second challenge is the implied lesson: teaching our children that less is more from an early age, that there’s great value in having a smaller number of toys that you play with extensively, that you don’t really need a mountain of toys. A mountain of toys stands in direct contrast to this lesson.

For us, the second challenge is perhaps more important than the first. The idea of having more stuff than you can possibly ever play with seems heavily tied to a sense of rampant consumerism as adults, where they buy more stuff than they possibly have time for. When you’re buying like that, you’re begging for financial difficulties.

Here are some of the solutions we’ve come up with for dealing with these concerns.

First, we’re starting to do “toy rotation.” Simply put, when the children are out of the house, we take a bunch of the toys at the bottom of the toybox and put them in a tub to store in the garage (temporarily). Occasionally, we’ll take some of the toys that are in storage and rotate them back into the mix, often pointing them out in a “Remember that toy? You haven’t played with that in a while” way.

Obviously, if they miss a toy that we’ve stored, we retrieve it for them. However, that hasn’t yet happened.

In the spring, we’re going to have a yard sale. Not only will we sell off almost everything in the garage tubs, we’ll involve the children in selecting toys that they’re willing to sell off. Our goal is to save a small number of toys for each child – the ones they enjoy the most – and sell off the rest of the toys.

The money from this yard sale – all of it – will go into a “family fun” pool which will pay for all of us to do something fun together (likely largely of the children’s choosing). Our best idea so far is to go to a water park that’s about two hours away from where we live, using the proceeds of the yard sale to pay for it.

In essence, we’re trying to turn excess “stuff” around our home into a fun family experience. The idea, of course, is that experiences trump stuff, and if stuff is just sitting around, it’s not an experience for you. It’s just dead weight that might as well be used in a better way.

We’re going to donate the yard sale leftovers to Goodwill. This way, once it’s decided that toys are going to go, they’re out of the house for good.

For now, though, as we look around our living room, we can’t help but notice the excess of kid’s stuff. Thankfully, now we have a plan for dealing with it.

On October 4, 2010, I made a choice to switch to a vegan diet due to health reasons and the recommendation of a dietician due to those reasons. It was a difficult choice, one that seemed almost impossible at the time.

On the first evening after the decision, I sat down to a final non-vegan supper with my family. As I ate the meal, I almost couldn’t imagine a diet without this stuff in it. No meat? No cheese? No milk? What good stuff would I eat?

I was intimidated by the mistakes of the past. I was so stuck on a set of personally damaging routines that I didn’t want to imagine life without them.

In January 2008, I hung up the phone after a phone conversation with my wife. On that phone conversation, I listened to my son repeatedly ask me when I was going to be home. I was on yet another work-related trip, you see. After I hung up the phone, I cried, because I felt like I was becoming the type of absent father I had always promised myself I wouldn’t become.

I knew I had to find another path in life, but the possibility of doing that scared me to my core. What would I do for income? Would I actually be good at being an increasingly important caregiver for my children? Would I have any self-respect without this job?

I was intimidated by the mistakes of the past. I was so stuck on a definition of what I should be professionally that I was damaging my relationship with my children, the one thing I promised myself I’d never do.

In April 2006, I stayed up through most of a very long night realizing that we were in a very, very deep financial hole. Simply put, we were spending more than we were bringing in and it was becoming unsustainable.

As I sat there, I tried to imagine a lifestyle where we didn’t spend as much as we were spending. I almost couldn’t conceive of it? Give up all of this stuff?

Again, I was intimidated by the mistakes of the past. I was so stuck on how my life had been for the past few years that I couldn’t bear to think of anything truly different from that pattern.

It is our routines and our ongoing mistakes that define us, in a way. Every one of us makes mistakes. The ones that repeat those mistakes, even when they see that those moves are in deep error, are the ones that wind up in deep trouble.

Most of the emails I receive from readers boil down to this very thing. They’re trapped by the mistakes and patterns of their past. They’ve done things a certain way for a long time and now they’re learning that this certain way doesn’t work, but the thought of abandoning that path and trying another one seems scary. It seems impossible to some.

It’s not.

You can make the changes in your life that you need to make.

If someone with a 500 DVD collection and a 200 video game collection can change his spending habits to buy perhaps five of either one in a year, then you can change your life.

If someone who practically couldn’t get through a meal without a healthy dose of meat and/or cheese can become vegan, you can make a big change in your life, too.

Yes, it’s hard. There is no real change in life that isn’t incredibly hard. We are all people of routines, whether we like it or not. Even those with a varied life do them within the context of routines.

Don’t be intimidated by the choices and mistakes of your past.

Just because you’ve always shopped for clothes at boutique shops doesn’t mean you can’t find a perfectly serviceable set of clothes at Goodwill.

Just because you’ve spent the last four years at a comfortable yet stressful job doesn’t mean you can’t quit and find something that doesn’t leave you eating antacids all day long.

Just because you’ve gained a lot of weight since college doesn’t mean you can’t practice some portion control, eat more vegetables, drink water, and start gently exercising via walks in the evening.

Just because you’ve bought five computer games a month for the past three years doesn’t mean you can’t spend your time actually playing these games instead of buying more of them.

Just because you’ve lost the person you thought was going to be the love of your life doesn’t mean you have to sit at home every single night waiting for nothing more than the next day to start.

Your past is your past. It’s full of mistakes. My past is full of a lot of them – the list above just scratches the surface of the idiotic things I’ve done and the idiotic things I continue to do.

Your past is not your present. Every moment, you have the opportunity to make a different choice. With every beverage you drink. With every meal you eat. With every moment you sit alone. With every time you consider a purchase. With every substance you consume. With every hour spent giving your energy and ideas to some soulless company that will spit you out at the first opportunity.

Change. Right now. And don’t look back.

What’s inside? Here are the questions answered in today’s reader mailbag, boiled down to five word summaries. Click on the number to jump straight down to the question.
1. Saving for education
2. Downsides of balance transfers
3. Needs, wants, and emergency funds
4. Handling risk intolerance
5. Converting debt into student loans
6. Taxes and freelance work
7. Income-based repayment
8. Handling new annual fee
9. Buy or repair?
10. Paying cash for a car

Laura Nyro is one of my favorite musicians. She was a singer and composer of jazz, gospel, rhythm and blues, show tunes, pop, and rock music whose popularity peaked in the late 1960s, but she’s most well known for a pile of songs she wrote for others. Strange, really, because I find her own renditions of a lot of the songs to be superior and far more soulful. I think her shyness (which comes out in interviews) may have played a part in her relative obscurity. I’d suggest a YouTube search for “Laura Nyro” if you’re curious.

Anyway, why mention her? I came across a quote from her recently that I’ve been thinking about a lot. I’m just going to share it with you without comment.

“As beautiful as simplicity is, it can become a tradition that stands in the way of exploration.”

Q1: Saving for education
I’ve started to notice my checking account building up money that’s not going towards any particular goal. I’m in a serious relationship and know that one day I’d like to have children and send them to college. Is there a 529 or other investment vehicle that I could put that money into for college considering I wouldn’t be able to specify a beneficiary? On a similar note, if I decided to save for a (probable) return to grad school for an MBA, what types of plans should I be investing in?
- Bill

You can absolutely start saving now for a future child’s education. I started saving in advance of my own children’s births.

All you do is open up a 529 account identifying yourself as the beneficiary. Then, when the child is born, change the beneficiary to the child. The amount will be treated as a gift for taxation purposes, which means that if the amount is less than $50,000, you won’t have to pay any taxes after changing the beneficiary as long as you spread out the gift across multiple tax years when you file your taxes.

As for yourself, you can also open a 529 with yourself as a beneficiary. As for what you should be investing in, the easiest method is to use one of their targeted investment options. Most 529s offer investing plans that are designed to maximize risk and reward depending on the date at which you’re planning on utilizing the money. I would use the option that matches your target year.

Q2: Downsides of balance transfers
My husband and I have broken every rule in your book, and are paying for it now. We are at retirement age and are thoroughly unprepared, but still lucky, since we both have legacy pensions from employers to fill in the gaps.

Assuming we could remain disciplined while we go thru this, is there a down-side to taking this approach?
- Rita

You make the assumption sound trivial, but it really isn’t. Companies offer such balance transfers because they know that the ability of someone in debt trouble to “remain disciplined” really isn’t all that high.

A balance transfer is what it is on the surface. They’re offering to essentially give you a 0% interest loan to pay off another debt you already have. That 0% interest loan comes with caveats. It will reset in a year. Depending on the agreement, you may have to pay back the interest you would have earned during that year.

Before you do this, make sure you have a cash emergency fund and a step-by-step plan for paying off this debt. Without them, you’ll be in even deeper trouble in a year.

Q3: Needs, wants, and emergency funds
I guess I have two different money problems, so I’ll start with the easiest to explain, need vs want. I’m 24 year old student so money is quite tight as I’m paying my own tuition fees at £3,290 a year I’m not very good with budgeting and wondered if you had any great tips or advice with someone who wants to learn to start and my main problem is with excess money, as soon as I have any I spend it stupidly. And I need to stop doing that but my problem is figuring out the difference between need vs want and quality vs quantity. This recently hit me when I bought a cheap jumper that after three wears it got a hole in the back and had to buy a replacement. I thought if I’d bought a more good quality one it would have a longer life span and would be able to wear it more. Sadly although this idea is great I only had a certain amount of money to buy a replacement jumper and it wasn’t the price for a good quality one so I had to again settle for a cheaper alternative now this jumper is already wearing thin! But the end of winter I’d have bought three jumpers which in the end would have cost the price of one good quality jumper but I didn’t have that amount at the beginning to buy one decent one. How do I stop this from happening again?

If it was a great world I’d happily wait til I’d paid my tuition fees off in April but the problem with that is once I pay them off I have to save up again for the next year only in September 2012 am I able to get financial help for my tuition fees but the problem is getting there! I’m really not quite sure what to do!
- Ally

As I read this story, I kept asking myself questions like

Does she really need to have her boots resoled?
Does she really need a laptop?
Does she really need to be buying new clothes?

What I see in your story is a bunch of expenses that are completely unnecessary for a debt-burdened college student. Go down to your local secondhand shop or thrift shop and buy some cheap shoes and whatever clothes you can find. Don’t buy them new. Use the computer resources of your campus instead of buying yourself a new laptop.

If your reaction to this response was, “Well, that’s no help!” then you’re not really willing to dig yourself out of the situation you’re in for want of stuff.

Q4: Handling risk intolerance
After losing a considerable sum in the tech stock fall (way back when) and then a huge sum in a failed real estate investment,
we are now extraordinarily ‘risk intolerant’.

Any advice?
- Laurel

Baby steps.

If you’re earning 1% interest in your account, put 1% of that somewhere where it’s at a higher risk. Even if you lose all of that, you’re still breaking even.

Next, if you’re earning 1% interest in your account, put 5% of that balance in a higher risk investment. Even if that high risk investment loses 20% of its value, you’re still breaking even.

Once these steps seem okay, start moving toward what a retirement portfolio should look like for your age, probably something like 30% stocks and 70% conservative investments (cash and bonds).

If an investment is keeping you up all night out of stress, it’s not worth it.

Q5: Converting debt into student loans
I make about $33,000/year and am currently $27,500 in debt. About $15,000 of that is VERY high interest rate credit card debt (between 24.99-29.99%) and the remaining $11,500 is 401k loans which I am locked into paying back at a rate of $55/wk for the next 4 and half years or so.

I’m afraid of what happens at this point if some major unexpected expense occurs, because I’ll have no way of covering it (half of the credit cards I’m paying on were closed by the banks a while back during the credit crisis, and the other half are still pretty close to maxed out).
- Tony

Student loans are typically awarded with a requirement that the money be used for education related expenses. However, most student loans do include a living stipend which is intended to be used to cover living expenses while focusing on your studies. This does include one’s bills.

If I were you, I wouldn’t go down this route. Instead, I would try to get into college with a student loan in hand, then negotiate with the credit card companies by clearly telling them that you are a student and you do not have the means to pay the bills. See if you can negotiate a settlement of some kind.

You can negotiate with them now, but you’ll have more leverage if you’re in a situation where you can demonstrate that you can’t pay the bills. Right now, you have a history of being able to pay the bills without a change in employment, so you’re less likely to have success by simply calling them up.

If you’ve reached a point where you’re simply going to default on these credit cards, call and negotiate with them.

Q6: Taxes and freelance work
As you probably know, when you earn money from a blog (or from freelance) you typically get it 30-60 days after you actually do the work. For tax purposes, should I account for this income when it’s earned or when it’s received? It seems a bit unfair to make me recognize it immediately when earned because I might never get it, but I can also see how maybe that’s the right thing to do.
- Nick

You are liable for all income received during the tax year. So, if you earned the money on your blog in December 2010, but the check doesn’t arrive until April 2011, you don’t have to file it until your 2011 taxes, which you would file in 2012.

This really is no different than earning a paycheck. If you work the last week of the year, you’re not getting your paycheck for that week (typically) until early in the following year. Many jobs don’t pay you for a pay period until the end of the subsequent one. So, if you start a job with a twice-monthly period on December 16, you won’t have to pay any taxes for that job during that year.

What matters is when you receive payment, not when payment is promised to you.

Q7: Income based repayment
I’m wondering if you know anything about Income Based Repayment (IBR) for federal student loans. Here’s my situation: 28 years old, graduated from medical school in 2009, now in my second year of residency (I’ll be completely done with my training in 2014 or 2015).
Debt:
-$205,000 in student loan debt (I know) from medical school mostly but also undergrad. Interest rates vary, 2-6%. Currently in forbearance.
-$2100 on private student loan, 2.2% interest rate, in repayment, making minimum payments monthly
-$6000 remaining on a $6500 residency application & relocation loan with 5.25% interest, in repayment, making minimum monthly payments.
-$2300 credit card debt – have been aggressively paying this down since I started reading your blog 6 months ago, it’s already down from $7000 and is my top priority

I have $2500 in savings, and am contributing automatically to that every pay period. I have not yet started saving for retirement. I’m wondering if you know anything about the merits of income based repayment, which (as I understand it) allows one to enter repayment on certain loans (about half of my education debt qualifies) and the amount due every month is based on your debt:income ratio. If you continue making payments for 25 years, any remaining debt is forgiven. However, since I can reasonably predict an increase from my current pre-tax salary of $45,000 to $200,000 once I’m done with training, I’m not sure the promise of forgiveness after 25 years is really a draw and thus I’m not sure of the benefits of entering IBR and wonder if I would be better off starting to contribute to retirement, since my student loans will be much easier to manage once my salary is increased and they are at a (relatively) low interest rate. I’m just anxious thinking about what is essentially a mortgage without the house.
- L. C.

Income-based repayment is a program in which your public student loan payments are capped at a reasonable amount based on your current income and family size. Typically, private student loans don’t have such a plan.

I don’t think that, since your loans are in forbearance right now and you’re confidently anticipating a big income spike in the future, IBR will really help you very much. When you get your post-education job and your loans go out of forbearance, your income will be high enough that IBR won’t really be of much assistance to you.

I think you’re thinking of this wrong, though, when you say that you have “a mortgage without the house.” You have an education that’s going to enable you to earn $200,000 a year. Without it, you’re earning $25,000 a year. Two or three years of that will take care of all of that outstanding debt, then you’re riding the financial gravy train to retirement. I’d far rather have $175,000 a year in additional income than a house worth $200,000.

Q8: Handling new annual fee
My husband and I recently noticed a $60 annual fee charge on his credit card. We’re unsure about to do about this, if anything. We don’t use the card much and never carry a balance, but would prefer to keep it because a) it has a high limit and b) we’re young and it’s our oldest credit history. Should we cancel the card and save the $60 a year, or just view that $60 as payment for a better credit score?
- Madeline

It depends on whether you have any other cards that are more than a few years old.

If you have such a card, I would cancel this one that is charging you a fee. The impact on your credit score will be small and that impact will disappear within a year or two.

If you don’t have such a card, I’d apply for one today and just sit on it for a few years. Pay the fees, then drop this lemon of a card in a few years.

Q9: Buy or repair?
Our basics: Roughly 3,000 cash emergency savings, heavily drawn down from what it used to be; about 5,000 in investments that I am hesitant to tap, since I was hoping to build them into an eventual house down payment; I expect to bring in perhaps 3,000-4,000 per month for the next few months, though I’m unsure how long that will last; our monthly expenses can be reasonably brought down to around 1,500 per month, including rent. We have close to 30,000 saved in Roth IRAs, but we haven’t contributed recently due to lack of income; I’m hoping to contribute something out of my next few paychecks to count as 2010 contributions (my husband and I are in our late twenties, so a bit behind schedule but not too bad). My husband has student loans, and will end up taking on more, but graduates of his program tend to either make more than enough to repay their loans or else qualify for loan forgiveness programs through public service, and he’s already ahead of the game since I’m (at least theoretically) able to work to pay our living expenses and he won’t have to take out extra loans to live on (yet). Other than that, we have no debt, credit-card or otherwise. Our credit histories are a bit sparse but very respectable.

(Very) Long story short, we will need a new(er) car eventually. Possibly two. Should we spend the money to fix up our old one? It feels like my decision to donate my car back in March is coming back to haunt me–it was a bit newer, a bit bigger, and somewhat better suited to the weather than my husband’s Avenger. That decision is made, for good or ill, but I’m worried about making the same mistake twice!
- Nicole

Nicole’s email was very long – I did my best to excise it down to a reasonable length.

In your situation, I’d try to keep your current cars running for as long as possible. If you replace them, you’re going to not only be on the hook for a monthly car payment, but you’re also going to be on the hook for higher insurance.

If you’re going into a period where you know that your income will be lower for a while, you do not want to take on required monthly expenses. Instead, I would bank the extra money you’re earning right now into a cash emergency fund in a savings account somewhere. Then, when an actual emergency happens (your car breaks down, etc.), you have the cash on hand to deal with it.

Q10: Paying cash for a car
I wanted to buy a car costing 20k. I already have the cash for it. However, financing for it means extra processing fee (350 cash vs 800 finance). It also means running around town to have the car evaluated, loan application (financing thru my current employer requires specific instruction) and will delay the delivery (car dealer will only release the car after the check from my employer cleared).

I’m in a good financial situation (I think) as i’m single with about 4 month’s salary for emergency fund. But it will took me about 2 years to save 20k again, if i’m really careful with my money (as new car means additional maintenance expenses) and i do plan to register for postgraduate study part time soon.
- Zid

As long as you’re not reducing your balance in the bank to nothing at all, I would pay cash for the car. Once the car is yours, I would seek to replenish the savings in your savings account as quickly as I could.

Look at it this way. If you take out a loan to do this, you’ll have a monthly car payment. The interest on those car payments will go to some company. On the other hand, if you take the money out of your savings to do this, you’ll still have a monthly payment – it will just go into your savings account. The interest on those payments will go straight into your pocket.

If you’re maintaining an emergency fund of at least $1,000, I would buy the car with cash.

Got any questions? Email them to me or leave them in the comments and I’ll attempt to answer them in a future mailbag. However, I do receive hundreds of questions per week, so I may not necessarily be able to answer yours.

If I have one single piece of career advice to give to anyone, it’s this: figure out how to get in the zone and do it as often as possible. If you can do that, everything else really is secondary. You will find success.

What do I mean by “in the zone”? It’s something I’ve talked about on The Simple Dollar a few times in the past, but I’ve never really defined what it means in so many words.

To put it simply, being “in the zone” means that you’re so absorbed by the task at hand that you lose track of time and place. When you get into that state, not only are you as productive as you can possibly be, you’re also much more open to what I call “creative bursts” – ideas that float in from somewhere in your subconscious that add even more to your productivity.

For example, on a given day where I’m “in the zone,” I’ll spend perhaps an hour getting into that flow. During that time, I’m not really very productive at all in an obvious sense – it seems like I’m wasting time. I turn off my internet connection. I turn off my cell phone. I close my office door. I meditate for a bit. Sometimes, I’ll stretch. Then, I’ll start off by doing a mundane work-related task: I’ll make a to-do list for the day and sketch out a few bare bones ideas for each element of that list.

An hour has gone by and I haven’t really done anything. What I’ve done, though, is put my mind in the perfect place to be really productive. Usually, at the point where I’m about to start work on a real task that needs my focus, I get sucked right into it. I cease to notice time passing at all and the words just fly out of my fingers. I finish a first draft of a post, then another, and sometimes another. I’ll revise an earlier draft. I’ll shoot off some email, all without skipping a beat.

Suddenly, I’ll blink and time feels like it catches up to me. I’ve accomplished a ton of stuff and only an hour and a half has passed. Without getting into that kind of zone, the stuff I had finished would have taken five or six hours. Instead, including the “dawdling” at the start, I’ve finished it – and usually finished it well – in two and a half hours, half the time in other words.

Every job I’ve had rewarded me greatly for getting “in the zone.” As a writer, a lab assistant, a computer programmer, an IT specialist, and most of the other miscellaneous jobs I’ve held here and there, I always found benefit from getting “in the zone.” Without fail, when I’ve been able to get into a work-focused mindset where the hours slip away from me, I am amazingly productive and churn out quality work. Often, it is this work that I have been able to hang my hat on, helping me to get promotions and, later, grow The Simple Dollar.

So, how can you make this really work for you?

Getting “Into the Zone”
The first step for getting in the zone is to have an objective. What are you hoping to accomplish today? I find that things go best when I’m focusing in on tasks that I estimate will take one to two hours – writing a first draft of a post for The Simple Dollar, for example, or going through my email inbox, answering the urgent messages, filing some into my “Reader Mailbox” folder, and trashing the spam. What do you hope to do in the zone?

The next step is to eliminate distractions. Turn off the internet. Turn off your cell phone and/or your desk phone. Close the door. Put on some noise-cancelling headphones. Minimize or eliminate the things that enable you to take your focus away from your work.

Finally, create a situation conducive to focus. This varies greatly based on the individual. For me, it involves a bit of meditation, some appropriate music, and a well-lit room. It could be completely different from you. My suggestion is to try to recreate environments where you’re sure that you’ve been able to focus in the past. You should also have all of the materials you’ll need for your tasks easily in hand.

Dealing with Interruptions
What do you do when you’re interrupted from your flow? I focus on three key things to make sure interruptions don’t completely shatter what I’m working on.

First, if it’s just a stray thought, I jot it down. I put that jotting in a place that I know I’ll look at later, then I return to the task at hand as quickly as possible. Usually, I don’t break my concentration.

Second, if it’s a minor interruption (like a phone call), I delay. I tell the person calling that it’s a bad time at the moment and that I’ll call them back in an hour. I then jot down a note about this and get back to my work.

Finally, if it’s a major interruption, I tell the interruptor to hold for a moment while I record as much of my train of thought as I can. I’ll finish a rough outline of the post I was working on, or save an email draft with notes on the additional things I wish to say. This way, it’s easier to pick up right where I left off.

Dealing with Life Changes
For me, getting in the zone and staying there is very routine-oriented. If I change parts of my routine, it becomes more difficult to get into the flow for a while.

A great example is the contrast between when Sarah is on vacation and not on vacation. Over the last several years, the norm for her is to be working, which means the house is quiet during the parts of the day when the children are at preschool or at the nursery. That silence in the rest of the house becomes part of my routine – I’m used to it and it enables me to slip into the flow.

Fast forward to the last several months. Since our third child was born in April, Sarah has been a stay-at-home mom, which means that aside from the periods when the two children are in preschool, all five members of our family are at home. The two older children absolutely love coming into Dad’s office and amusing him with the clothes they’re wearing for dress-up or a song they made up or a piece of art they’ve created. I hear their laughter (and occasional crying) from my office and it pulls me away.

This has made it difficult to consistently be in the flow. I have adapted by using noise-cancelling headphones and locking my office door when I really need to focus, with only one way for Sarah to interrupt me (a call via Skype). The problem with this is that I become completely unaware of other household responsibilities – the UPS man (or someone else) at the door, the house telephone ringing, and so on.

When she returns to work later this month (by her own choice – but that’s another entire post, isn’t it?), the routine will change again. The house will become quiet for swaths of the day. I’ll remove my headphones and again be aware of some types of household responsibilities during the day.

That’s a change, one that will, whether I like it or not, affect my ability to get into the flow. I’m going to couple that change with another – I intend to completely rearrange my office (mostly to free up the current guest bedroom to become our oldest son’s bedroom in the next year or two). This will all be a significant routine change.

Since I know this routine change is coming – and I know it’ll drop my productivity for a while – I’m doing what I can right now to work ahead, so that during that week when Sarah is back to work and I’ve rearranged my office, I can focus on mastering getting into the flow in my new environment.

Environmental change can be a challenge when it comes to getting into the flow. Account for that. If you’re about to move or change environments, plan your work accordingly so that you’re able to minimize the interference.

Understanding how to get into the zone regularly has dramatically altered my professional and personal productivity and made it possible for me to find my own unique balance of work and personal life. I can now spend more time with my children than I ever believed possible while still accomplishing the things I need to complete.

Several people wrote to me expressing some surprise that I didn’t have a money-related resolution this year. To tell the truth, I don’t know where a single-year money resolution would come from in our budget or in our life.

We have some ongoing three-to-five year goals that seem to be in a good place right now. We’re saving up for a home in a more rural setting (as if we’re not rural enough as it is!). We’re building up savings so that when our two current vehicles need replacement, we can just pay cash for them. We’re paying down our mortgage.

All of these goals aren’t so much resolutions as they are ongoing things that we hope to revisit in 2013 or 2014 or so. We just realize that constant forward work throughout 2011 and 2012 will move us closer and closer to those goals.

Six People You Can’t Afford to Lie To I think it goes further than that. Who can you really afford to lie to? (@ my dollar plan)

Why You Should Donate More Money to Charity This list makes a great case for donating to charity. For me, it comes down to abundance versus scarcity – charity is a natural result of an abundance mentality. (@ sweating the big stuff)

How to Be the Person You Want to Be First, you have to figure out what kind of person you want to be. That in itself isn’t an easy task. (@ dumb little man)

The Power of Brevity and Deletion Simplicity works in almost every avenue of life, from the possessions you own to the words you use. (@ jonathan fields)

What Makes You Cry Tears of Joy? Do That The things that made me cry in 2010 were peak moments with my family. That’s why I write The Simple Dollar – it affords me the freedom to spend significant time with them. (@ man vs. debt)

For us, 2010 was a year of learning for both the parents and the children in our household about what allowance means, how it works, and what kinds of money lessons our children are learning.

Let’s roll back the clock to November 2009, when our children each received piggy banks and the allowance adventure got underway:

Our son received a Money Savvy Pig for his birthday, which has four slots to designate savings of various kinds. The bank featured a “spend” slot (you can spend that on whatever you want), a “save” slot (you’re saving up for a larger item), a “donate” slote (you’re donating that money to a charity), and an “invest” slot (you’re going to invest that in the future).

In order to minimize sibling rivalry, we gave his younger sister a single-slot piggy bank.

We decided to try a weekly allowance for each child, giving them each two quarters for each year of age they were. For the older son, we made a requirement that at least one quarter of his allowance had to go into each slot. The allowance was not tied directly to chores, but we occasionally gave them both opportunities to earn a few extra quarters through helping with chores that were above and beyond the usual household expectations for them.

What did we learn after a year of this? Did our children learn anything about money?

The younger one is a saver! Each week, our daughter would put her quarters into her bank and then put it back in the cabinet. We allowed her to decide when and how to spend the money inside, but almost without fail, she never wanted to spend it on anything. She likes that her bank is getting heavy. She has only used her allowance twice, both times on individual large toys, and neither time did it empty her bank. She doesn’t have any specific savings goals for the future at this point and seems to mostly enjoy having lots of quarters in her heavy bank, even though she understands she can use them for things that she wants.

The older one often lost focus on savings goals. Our son has no problem with the actual saving process. His problem is that he gets heavily into saving for specific goals, but by the time his savings starts to approach a goal, his interests have changed and he ends up having a new target for his savings. Thus, when he actually reaches a goal, it’s usually for an item that he’s just recently decided on.

He typically does not use his “spend” slot for small things, as he prefers to be patient and use it as part of his “savings” slot. He has expressed a desire to give the money in his “donate” slot to Jump for Joel, but that hasn’t occurred yet. The “invest” slot is going to eventually turn into a savings account at our local bank, perhaps around his sixth birthday.

Not using the allowance as a form of punishment or leverage has worked well. We want to establish that the basic things we expect from them around the house, like clearing the table after meals, basic politeness, and so on, are not tied to any form of compensation. Such basic behavior is expected. Their allowance is merely a tool to teach simple money management. Our children seem to respond better when there are not bribes involved – bribery works well the first time, but after that, would you really expect them to do that thing you want them to do without compensation?

The children anticipate allowance day. Typically, allowances are doled out on a Sunday, and both of our children anticipate it and request it. They’ll often ask on Saturday if that day is “allowance day” and an allowance request is usually out there by noon on Sunday. It doesn’t seem to be a money-grabbing thing; I think they just have fun putting the coins in their bank and then lifting them up to feel how heavy they are.

Our oldest child is starting to understand prices and what they mean. This not only builds on his allowance, but upon many of our discussions when shopping. He now understands that things have different prices and different costs. You have to spend more of yourself in order to acquire a more expensive item. Spend more of yourself? When you spend money, you’re really spending time and energy. In my son’s case, it’s time.

He doesn’t always ask how much it will cost; he often asks how many weeks he will have to save to pay for the item. He already has a basic understanding that money represents your invested time and effort. Money is simply a piece of paper that says I’ve invested a certain amount of time and energy in this. Deeply understanding that changes your relationship with money. It makes the money less abstract than before and much more real. It makes debt more frightening and good choices more appealing. Invested money, which earns interest, seems almost miraculous.

These are exactly the lessons we want them to learn from this allowance experiment. These are small, early steps, but they’re all signs that they’re heading down the right road, one that will put them in a place where they won’t repeat the money mistakes of their father.

Right now, our emergency fund would cover ten months’ worth of living expenses for our entire family. This is, of course, assuming that Sarah and I are both jobless (though able to care for our children) and that I’m earning absolutely no income from The Simple Dollar. We would be able to pay our bills from our cash reserve for ten months in this situation.

First of all, how did I build that up? The truth of the matter is that Sarah and I are both pretty frugal. Our only outstanding debt at this point is our mortgage and we minimize our spending in other areas. Over the course of running The Simple Dollar, we’ve done a lot of little things to reduce our spending, from air sealing our home to putting in a programmable thermostat and mastering the use of our kitchen. Beyond that, we’ve both reached a point where our frivolous spending is pretty small. I would not be surprised if I spent less than $100 out of pocket on things that aren’t basic requirements in 2011. Truly, I don’t feel like I need anything, and my wants are pretty minor as well. When you don’t spend, you accumulate.

(It’s also a sign that “ten months’ worth of living expenses” isn’t nearly as much money as you might think it is. It covers our mortgage, our bills, and about $350 a month for food.)

Here’s the thing, though. A great deal of that accumulation is just sitting there in cash form. Rather than putting a significant portion of it into investments, I keep it for an overly large emergency fund.

Is that a good thing (better safe than sorry) or a bad thing (being too overcautious is keeping me from reaping rewards)? Well, let’s walk through that question step by step.

What’s an Emergency Fund?
Simply put, an emergency fund is some amount of cash you have in reserve to handle life emergencies. If you lose your job, your emergency fund is there to help with the bills. If your car’s transmission starts dragging on the ground, your emergency fund helps with the repair bill. If your sister shows up on your doorstep in tears and you find yourself with an unexpected house guest to feed and clothe for a month, your emergency fund is there for you.

You get the idea.

An emergency fund should be relatively easy to access. For some people, just having it in their local bank’s checking or savings account works. For others, it needs to be in a more remote location, or else temptation will convince them to spend it all on bubble gum.

An emergency fund should not be a credit card or a line of credit. Both of these things rely on a bank that’s always going to be willing to extend credit to you. The very time you need an emergency fund is often the very time you become a less reliable place to extend credit to. Credit cards and lines of credit are not rock-solid and reliable.

In short, an emergency fund needs to be reliable and accessible to truly be useful.

How Big Should It Be?
This is really the big question, isn’t it?

Dave Ramsey, for example, suggests that a person shouldn’t have an emergency fund at all until they’re caught up on their bills and shouldn’t have more than $1,000 in their emergency fund if they have any outstanding high-interest debt (probably anything above 8% or so).

The more personal finance books you read, the more answers you get. $2,500 will be the advice from one book. One month of living expenses, says another book.

The advice I’ve come to trust and rely on is two months’ worth of living expenses for each dependent in your household. I think this is a great number to shoot for in a small household – a single person, a couple, or a couple with child.

But when you start having multiple children – as we do – does it cross some sort of line?

The Fine Line Between Practicality and Paranoia
What sort of future am I envisioning in which ten months’ of living expenses will be needed? Can I even envision emergencies that will require such a chunk of cash?

I certainly can. I can imagine a long period of unemployment. I can imagine various disabilities and long-term illnesses.

In each of these scenarios, however, I still can’t realistically conceive of how ten months’ worth of emergency fund will be needed.

The only possible scenarios where such a large emergency fund would be needed are ones that involve a long series of simultaneous incidents. Frankly, these types of scenarios border on paranoia when I step back and look at them realistically.

Thus, I’ve decided to pare down my emergency fund to six months’ worth of living expenses and put the rest into our investment account, which is being used to save for a piece of land in the country (although, of course, it might be used in other emergencies if absolutely needed).

Being practical and having an emergency fund is a good thing. Being paranoid and having an excessive cash emergency fund merely means that you’re leaving other opportunities on the table.