This past week, I had a wonderful exchange with Maggie, an administrative assistant at a Fortune 500 company. In one email, Maggie said the following, which I found quite compelling.

The rest of my life feels completely out of control. My children are demanding, as are my bosses, and the demands change all the time. The kids are constantly making messes at home, undoing any house cleaning that I do. I seem to be learning a new software suite every month. I wake up some mornings feeling completely frazzled, while other mornings I feel completely wonderful.

One of the few times I feel genuinely in control of my immediate situation is when I’m shopping. I control what I buy, and when I leave that store, I feel that I’ve exerted control over that purchase. That sense of control feels very good. It feels like a bubble against the craziness of the rest of my life.

I think Maggie hit upon a very big element of why people today have a hard time getting a grasp on their spending and resent any suggestion of change in their spending habits. In the eyes of some, the ability to purchase is one of the last pieces of controllable freedom in their very chaotic life.

I can certainly see how my life was much like this for many years.

I would often feel very relaxed when I would go into a store or a coffee shop. In here, I was no longer responsible for children. I was no longer responsible for server uptime. I was no longer responsible for figuring out strange demands from clients.

A store became something of a place of solace. While I was in there, I would feel as though I was in control of what I did. I decided whether or not to make a purchase. I decided how long to stay. I decided whether or not to order another coffee or buy a second book. It was wholly my decision, which contrasted with most of the rest of my life where it felt as though the decision-making power was out of my hands.

Of course, such a perspective often developed a weird, negative relationship with the rest of my life. Because I had that brief solace, I would often feel more capable (at least in the short run) of dealing with day to day life. I could go back to work and make it through another day or two (even though I enjoyed the work, it was incredibly stressful at times). I could go home and handle a crying baby or whatever else was going on.

At the same time, though, I was spending money on unnecessary things, often money that we didn’t really have. I would often bust out the plastic in order to buy a new book or a video game.

That spending was actually prolonging the things that I had no control over. With every dollar I spent on something unnecessary, the tighter I became tied to the difficult pieces of my life.

With every unnecessary purchase, it became harder to even consider moving to another job, let alone another career path.

With every unnecessary dollar, it became harder to look at broad ways of improving our home life (like a larger home, for one).

My purchases were tying me to the very out-of-control things that seemed to define my life.

Every time I got a bit of a short-term perk from feeling in control because of a purchase, I contributed to extending the overall out-of-control feeling in the rest of my life.

I see this all the time in the lives of people around me, too. I know many people in my hometown area who “unwind” by drinking a few beers or buying something for one of their hobbies (like a new ATV). Their lives and the world around them are chaotic, but in those moments, they feel much more in control of things. They’re the only ones involved in the choice to have another beer or to ride around on that ATV.

Somewhere along the way, I made the choice to abandon that control cycle. I didn’t want to continue to feel that large swaths of my life were out of control, with me just along for the ride.

The first step, for me, was to look for areas of my life that I could control without spending money. For me, the big thing was to get organized. Much of my big interest in GTD was simply gaining a sense of control over as much of my life as possible. Similarly, whenever I encountered things in my life that I didn’t understand, like new technologies or new world events, I went to the library to learn more about them.

What I found was that the more in control of my life that I felt, the easier it was to make good spending decisions. I no longer felt like stores or coffee shops were my protective bubble against the chaos in my life. Instead, my home office area became that bubble – and I often found that I could stretch that chaos free zone out into various aspects of my life, from grocery shopping to child care to, eventually, my professional work.

The more good spending decisions I made, the less chaotic my life became. I felt more in control of my money. I gradually felt more in control of my professional life. We were able to move into a larger house, which helped with a sense of control over our personal lives.

What can you do if your life feels out of control and spending sometimes feels like your only solace?

First, adopt some personal organization tactics in your own life. Spend some time learning about things like GTD and voluntary simplicity. Cut back on some of the activities in your life.

Second, define a new area of solace in your own home. Make one room in your home a place where you feel like you can retreat and get your mind and spirit under control. For me, it was a home office.

From there, modify your spending habits and channel the money you save towards bigger life changes. If you’re spending far less than you were before, it becomes much easier to walk away from a high-stress job or to hire other forms of help to contain some of the edgier aspects of your life.

Life is too wonderful to go through feeling as though you’re completely out of control and simply riding a wave into tomorrow.

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. Buying a car
2. Life insurance when uninsurable
3. Consolidating accounts
4. Selling homemade items online
5. Investing down payment
6. Credit card conundrum
7. Psychological blow of mistake
8. Is bankruptcy the right choice?
9. Lending to father-in-law
10. Fearing financial armageddon

This past weekend, my parents visited us for two full days (Saturday and Sunday) and the better parts of two other days (Friday and… well, they probably haven’t left quite yet as you’re reading this – I’m writing this really early on Monday morning before everyone is awake).

I love it when they visit, and my children do as well (my wife… well, she gets somewhat stressed out, much like I do when her parents visit, regardless of how well we both get along with our in-laws). Unfortunately, it also means substantial extra work – preparing meals, cleaning, prepping the guest bedroom, and so on.

By the time the house is empty again, I’m ready for some sleep!

Q1: Buying a car
So- I have a 1999 Toyota Corolla with ~125,000 miles. The engine has been making noises since last year and now the check engine light is on again. After dumping about $700 into it, plus new tires, plus frequent oil changes, plus 2 cosmetic accidents, the car is still really taking a turn for the worse. I am afraid of dumping more money into it if the engine is a mess… It’s knocking really badly.

I will need a new(er) car in the next year or so but am scared to have to be making car payments and much higher insurance payments with such a small monthly check. I am also afraid of buying a used car because I don’t want to get a money pit. I’ve been thinking about a 2010 Honda Civic ($15,000 and 0.9% financing for 60 months). Do you have any suggestions? My sister is really adamant about me not buying a new car because doing the same thing put her in a bind a few years ago.
- Jenna

Don’t buy new unless you can easily write a check for it. If you can’t, then your sister is right – you’ll be in a bind.

If I were you, here’s what I’d do. I’d start making a car payment right now. Your monthly payment on the loan described above, ignoring sales tax and any other fees, would be $256 a month. I would actually recommend that you start making a $300 per month payment right away.

Pay it to where? Your savings account, of course.

If you’re thinking that you can’t swing such a payment now, how are you going to swing it in a few months when the bump in insurance and the new payment plan for the car will add up to at least $300.

Keep saving that $300 a month and wait to see what happens to your car. Wait until it’s finally finished, then get the best car you can for what you’ve saved. If you have to take out a small loan, that’s fine, but the key is to get yourself a car that will last for a few years while you keep saving.

Avoid a car loan if you possibly can. Such loans are an incredible pinch on your monthly cash flow, one that you’ve got to head off.

Q2: Life insurance when uninsurable
I have most of my financial house in order; no bad debt, only a mortgage, 12 month safety fund, funding my 403(b), etc., and following a budget. The one item that eludes me is life insurance. Ten years ago, I had a kidney transplant and since then, I cannot find a company to provide life insurance. I’ve thought about self insurance but you just can’t build up much at $25 a month. Are there other options or paths I should consider? By the way, even though I’m single now, I figure this is something I should address before I get to the point of having a significant other.
- Andy

The problem is that life insurance after such a major health crisis is going to be prohibitively expensive if you can even get it at all.

When someone quotes you a rate for life insurance, they’re doing so based on a model for how long you’re expected to live. These models are incredibly sophisticated and usually accurate.

When those models show a result that indicates your likely death will occur before your policy finishes out, then they will either deny you insurance or offer you prohibitively expensive insurance.

Life insurance is a business. The people selling it are trying to make a profit, and the way to do that is to hedge their bets on people.

Now, what can you do in this situation? Your best route is to save and keep your financial house as clean as you can, which seems to be what you’re doing. You may also want to see whether or not your employer offers life insurance as a work benefit.

Q3: Consolidating accounts
I think my finances are too complicated–too many different banks, etc. I’d like to consolidate, but I don’t want to end up putting all my accounts at one place. That scares me. I’d really appreciate your thoughts on how to do this.

The DRIPs. Are there any consolidators? One statement a month that had all 5 different accounts?
- Ralph

Your plan is very good. I’ll address your specific points in turn.

I’m not sure there’s a need to “diversify” your credit cards by having them held by different banks. A new company may give you a high limit, but that depends on your credit score.

Typically, you have to have some sort of “event” to roll over your 401(k) to an IRA. The most ocmmon event is switching jobs. Without such an opportunity, you have to take a large tax hit to do the transfer yourself, completely undoing any tax advantage from such an account.

You can consolidate all of your DRIPs with a brokerage, but the costs will be much higher. DRIPs typically are run by the individual companies.

Q4: Selling homemade items online
My girlfriend designs healing gems jewelery, I would like to know where to post them.
- Eddie

Your best bet is to use etsy or a similar site that focuses on selling handmade items. I’ll freely admit that I’m a semi-frequent shopper at etsy, as I’d rather give unique homemade gifts at many occasions than giving whatever’s on the shelf down at Target.

It’s important to note that unless you’re doing an extremely high volume of sales, such sales will likely just be a nice perk of a hobby that she’s already passionate about. The exception to that, of course, is if she’s extremely talented, on the order of the top jewelry designers in the world, and can command a very large premium price for her items.

Since she’s probably not at that level and also assuming she’s not interested in running a sweatshop, keeping this as a hobby is probably the best option.

Q5: Investing down payment
I’m not in any financial difficulty and I’m doing quite well financially. As a 25 year old recent college graduate, I was fortunate enough to find a good paying job right out the door. I have a 4 month emergency fund, have no credit card debt, and have my car paid off. My question is this: Within the next several months, I’ll have come into ~$20,000 that I’d like to put away for a down payment on my first house. I don’t anticipate needing this money for another 3 to 5 years. I’m wondering if it’s ever occurred to you to invest this money in REITs? I’ve read in a number of places, and understand the reasoning, for why investing a down payment in stocks is a terrible idea. But if REITs are correlated to real estate, then wouldn’t the down payment money be catching rising real estate prices? (Or conversely, losing money when the market goes down?) Since the $20,000 is explicitly for purchasing a house, then tacking that money to the real estate market doesn’t seem unreasonable. I know this may sound unorthodox since I haven’t found anything written on it – but am I missing something here?
- Kevin

The problem with your plan is that not all areas have identical real estate situations. Some areas were barely affected by the 2008 downturn, while others are so devastated by it (with thousands of McMansions sitting unoccupied) that prices are still tumbling.

If you’re in an area where prices are moving upwards, then if you own a REIT that’s flat or going down, you’re going to be hurting.

I agree that stocks are not a great choice for such a short-term investment. I would probably buy something that retains value, like bonds or CDs. Yes, you won’t earn much, but you won’t be putting your balance at risk, either.

Q6: Credit card conundrum
[A certain large bank] recently sent a notice that I would now be assessed a $59/year annual fee. I have never missed a payment, always pay over the minimum due and have never been late. Yes, my credit report has taken a few hits lately because of my ex-wife going foreclosed on 2 properties that my name was still attached to even though she was granted full control. However, when I called [this certain large bank] they said everyone was gettin this fee even though the letter was written stating there was either; serious delinquency, too high balance, or poor review of our banking relationship.

My question is…do I close this account to show my anger and save the fees, or pay the piper to keep my credit report from dropping even more?
- Andy

I don’t think the bank will notice your anger. Megabanks see many accounts closed and opened each day – losing one probably won’t be noticed at all. I would be much more concerned about your personal situation than making the bank realize their mistake in losing you as a customer.

If you don’t actually need the credit card for your personal finances, I’d cancel that card as soon as possible. There’s no need to have that card hanging around, swallowing down steep annual fees.

It’s hard to tell why they caused the fee based on what you described in that letter, but I will say that the banks have done some scrubbing of people holding accounts with them, tossing fees, reduced credit limits, and sometimes cancellations on them. The best solution, as always, is to ensure that your personal finances don’t rely on having that credit card.

Q7: Psychological blow of mistake
I was humbly wondering Trent, if you would have any advice on surmounting the psychological blow it is when, after making so many fundamental changes in behaviour and working so hard for the last eight weeks, you find you have made a banking error and bounced a cheque costing one $40… While I’ve tried to console myself via “as long as I learn from it (ie. fine-tune my banking systems etc.), I was wondering if you had any sort of sage advice that could propel me over this mental(and connectedly emotional) hump any faster…
- Sarah

Every one of us makes little mistakes like this. I certainly do. I’ll forget to pay the trash service. I’ll forget to plan ahead for Thursday night’s dinner. We all make little mistakes.

My method of handling such mistakes is pretty straightforward. I start off by simply saying “Yep, I made a mistake. It was my fault. I can learn from this.” I then also remind myself that overall, I’m in a great financial position with far more good moves than bad.

After that, I directly address the problem. Why did it happen? What can I do to make sure it never happens again? I try to implement some sort of solution to make sure it never repeats.

Usually, at that point, I feel pretty good about things.

Q8: Is bankruptcy the right choice?
Long story short, I’ve got $50+ grand in credit card debt, $40+ grand in student loans, a mortgage, car loan… Considering a bankruptcy falls off your record in seven years (correct?), and I’ll realistically never be able to pay off my debts (least of all not within seven years), is bankruptcy the smart decision here? For what it’s worth, the majority of my credit card debt came mostly from some unfortunate situations, unemployment, and of course some bad decisions overall. I make decent money now and have a good credit score (703ish), with no late payments on anything. I’m keeping my head above water, but that’s about it, with everything going towards bills and nothing into savings.

Just trying to figure out the best way possible to break out of this hole and start moving forward with my life. Would appreciate any honest, realistic advice.
- Will

Chapter 7 bankruptcy stays on your report for ten years. Chapter 13 bankruptcy (where you basically agree to pay back all of your debts over a longer period) only lasts for seven, but it sounds like you’re in a Chapter 7 situation.

Chapter 7 means that the courts will liquidate most of your non-essential property, then distribute the earned money to your creditors, at which point they go away. The bad news is that student loans are generally not discharged in a Chapter 7 bankruptcy.

In short, there is no magic wand that will make all of the debts you have right now disappear. Since you’ve not actually been late on any debts, if I were you, I would focus on increasing your earnings in any way you can. Get a side job, start a side business – anything to increase income. Throw that extra income at your debts. Eliminate the smallest debt first – I think you’re really hurting for cash flow, and that’s the easiest way to improve cash flow.

Q9: Lending to father-in-law
My husband wants to loan 1/3 (one third) of our savings to his father.

Am I so wrong? If I am, I must be really wrong, because I really resented my husband’s request.
- Sue

I can’t say whether or not you’re right to resent your husband. I will say, though, that he should have discussed this plan with you first before taking it to his parents. I also find it a bit strange that you’re looking at the money as half his and half yours, rather than our money. Such a perspective does not imply a shared future, which makes for a worrisome long term picture.

As for the loan, I usually think it’s a horrible idea to loan money to family members and friends. I have no problem with a gift, but lending money creates a lender-borrower situation, and people typically don’t have warm and fuzzy familial feelings towards their banker – or towards anyone to whom they have to make a regular payment to. Often, the borrower views such an arrangement as being the lowest priority in their financial life, lower than other forms of spending, and this just creates resentment.

Given your respective worries and stresses, you might want to consider gifting a smaller amount rather than lending a large amount.

Q10: Fearing financial armageddon
I can’t sleep because I am so worried about political stupidity here and political unrest abroad sand-bagging my savings and my stocks. I am half-convinced that this country is facing financial Armageddon. The constant loss of jobs worries me too, since I am a sole supporter of an elderly parent. I am saving as much as I can now, but I came to this realization so late in life, I fear it may be too late for me. Although I have credit-card and mortgage debt, I have two jobs that I love (full & part-time). I can’t afford to invest but I have a 401(k) – fully matched. I already do batch-cooking, scratch-cooking, garden, can and sew. I have a stocked freezer. I pay extra on the 2 credit cards every month. I pay an extra mortgage payment every year.

I am also trying to read about the depression and about poverty in general to see how people cope. Can you recommend any books that might ease my mind?
- Peggy

What exactly is the scenario you’re envisioning? It sounds to me like you’re attempting to prepare for something, but you don’t know what it is.

If you’re envisioning a return to the 1930s, that is impossible. The jobs that were cut in the 1930s don’t even exist in the United States today – they’re already gone. I don’t think reading books about the depression and about poverty will ease your mind in this situation.

Are you envisioning massive food shortages? A breakdown in the transportation network? A complete devaluation of the dollar? Each of these scenarios has a different course of action.

Personally, I don’t prepare for any of them because, frankly, I don’t believe any of them are likely to happen. Sure, they’re possible, but it’s also possible that Earth is hit by a giant meteor tomorrow, destroying life as we know it.

I do things that make me more self-sufficient, but I don’t do them in fear of some unknown bogeyman. I do them because they make my situation better right now and they have a secondary effect of improving my situation in such a dark future.

I will say one thing: people who promote such a negative view of the future often have a big financial stake in convincing people that such a negative future is about to happen. Such premonitions are usually coupled with advertisements for gold, non-hybridized seeds, a new book, and other such products. Beware people who quickly segue from negative premonitions to product sales pitches.

Got any questions? Email them to me or leave them in the comments and I’ll attempt to answer them in a future mailbag (which, by way of full disclosure, may also get re-posted on other websites that pick up my blog). However, I do receive hundreds of questions per week, so I may not necessarily be able to answer yours.

Every Sunday, The Simple Dollar reviews a personal finance or other book of interest. Also available is a complete list of the hundreds of book reviews that have appeared on The Simple Dollar over the years.

It was the subtitle of Jacob Lund Fisker’s Early Retirement Extreme that convinced me to pick it up. “A philosophical and practical guide to financial independence.” Intriguing enough for my eyeballs, particularly since the subject matter of the book seemed to be in line with my own experiences on what it takes to be financially independent, as revealed from the text on the back cover (which explains the book so well, I’ll just quote it here):

This book provides a robust strategy that makes it possible to stop working for money in less than a decade. It provides a shift in economic perspective from consuming to producting. Your value to society is not how much you earn or buy, but what you create and produce. Consumers are often forced to buy expensive solutions, but producers have the flexibility to create their own solutions at a quarter of the cost. The resulting savings are invested to cover the remaining expenses, resulting in financial independence.

The strategy can also be used to pay off debt, travel the world, volunteer, go back to school, or simply work without worrying about the next paycheck. It offers a compelling alternative to the default choice of getting a college degree, buying a house, filling the closets with stuff, and then spending the next 40 years paying it off.

In other words, if you focus every action – or as many actions as possible – in your life on producing rather than consuming, you’re going to set yourself up for lasting financial success.

It’s a very interesting perspective to have on personal finance as a whole, one that goes hand in hand with voluntary simplicity and frugality. Let’s dig in to see what else Fisker has to say.

A different frame of mind
Most people look at problems in their lives today and come up with a solution that usually involves buying a product. You want to barbecue? Go buy a grill and a propane cylinder instead of building a fire pit and bartering for wood. You want to move heavy items? Go buy a cart rather than focusing on improving your personal health and strength.

Fisker’s general philosophy is that, at every possible opportunity, you should focus on solving the problems life throws at you yourself, with minimal purchases to solve those problems. In doing this, you build a set of skills and attributes that enable you to solve even more problems in your life. If you build a fire pit and start using it, you learn about open-fire cooking techniques. If you get stronger to move a heavy item, you’re more capable of doing things like changing a car tire.

Hand in hand with that is reinvesting the money you’re saving by doing things yourself. If you’ve not bought a grill and you’ve not purchased a cart, then you can take that money and save it. You’re not paying the plumber or the electrician, either. You’re not buying prepackaged foods or take-out. You’re not buying gadgets or consumable entertainment. That money all goes towards making yourself independent from work.

It’s a path that’s not for everyone, of course.

The lock-in
Most of us spend the first big part of our lives – childhood and early adulthood – acquiring a set of skills that do not lead to that kind of self-reliant life. We’re trained from a very early age to be consumers. We buy things to solve our problems. We learn skills that make us more effective consumers. We go to college – and usually go way in debt for the privilege – just so we can learn a skill set for a very narrow career path. We buy a house, a car, and countless other things that weight us down with debt and upkeep payments.

And we’re stuck. We don’t have the skill set to approach life any differently. We’re locked in, and to break that lock is extremely difficult and requires adopting some lifestyle elements that are going to be substantially different than the elements of the lives of people around us.

Economic degrees of freedom
The best state for anyone to be in during any economic environment is to be what Fisker refers to as a “Renaissance man,” an individual who is skilled in many different areas and is capable of maintaining many different avenues of income. Few people fall into this category in terms of their personal skill set – they’re either committed to one skill set or committed to one particular method of earning income (like their job).

A “Renaissance man,” in other words, has many degrees of economic freedom. They can switch jobs or career paths easily and have the skills to succeed in many different areas. In order to be such a Renaissance man, though, a person has to make a consistent commitment to actions that either produce value or directly improve the individual’s ability to produce value.

The Renaissance ideal
The Renaissance ideal is a life spent building skills or producing value, with as little consumption as possible. Such a lifestyle has benefits in many different directions, from the financial to the ecological, and Fisker covers those.

Fisker also examines what it takes to become highly skilled at specific tasks, using a “10,000 hour” metric for strong mastery of an area. Naturally, few people become that specialized, so Fisker encourages people to evaluate how they’re building skills. In other words, you shouldn’t just repeat the same thing over and over and expect it to build skills. Drills are incredibly useful, but if you just do the same drill over and over, it’s difficult to grow.

Strategy, tactics, and guiding principles
There are no such things as needs and wants beyond things like sleep and very basic nutritional intake. That’s a pretty strong statement to make, but Fisker does a great job of spelling this idea out.

Let’s say you’re looking at your needs and your wants with regard to housing. You actually have a lot of options in that regard: sleeping under the stars, sleeping under a piece of canvas, couch surfing with friends, renting a tiny room, and so on. We often limit our options without even thinking about it.

What you have there isn’t needs or wants. What you have is a list of options to choose from. When you immediately start eliminating options, you tie yourself tighter and tighter to a certain type of lifestyle that, by its very nature, excludes many types of financial and personal freedoms that you may otherwise desire.

A Renaissance lifestyle
Fisker spends most of this chapter outlining specific elements of living what he describes as a “Renaissance lifestyle,” one that’s built around the accumulation of skills rather than the accumulation of goods. This chapter is quite long and extremely detailed.

Much of it, however, is spent breaking down specific ideas that people have built in their heads about what’s “required” for modern life and what’s “normal.” If you step back from the elements of your day to day life and look at the true breadth of choices before you, you can actually make some very radical shifts in your life if you so choose.

For me, there are a ton of great ideas in this section. Some of them are quite workable, while others aren’t as workable.

Foundations of economics and finance
The book closes with a brief look at economics, almost as an appendix to the principles in the book. There’s not much new ground here if you’re familiar with Economics 101.

Is Early Retirement Extreme Worth Reading?
This is a book that tackles a completely different approach to personal finance and modern living than almost every other personal finance book. If you’re merely looking for help on investment choices or want someone to hold your hand while you create your first budget, this book won’t be of any use to you.

However, if you’re interested in some intriguing thinking about modern personal finance, self-reliance, and entrepreneurship, Early Retirement Extreme is a fascinating book. It’s absolutely loaded with thought-provoking ideas. If you’re not left with some food for thought after reading just a few pages of this book, then you’re not actively thinking about your financial state as a whole.

For me, this was one of the most compelling personal finance reads I’ve enjoyed in a very long time. While I don’t wholly subscribe to Fisker’s ideas, there were so many thought-provoking points in this book that I’ll have food for thought for years. In fact, I wouldn’t be surprised if many posts on The Simple Dollar in the near future eventually trace back to this book as a genesis point, where my mind has taken some little thread from this book and run with it for a while.

Check out additional reviews and notes of Early Retirement Extreme on Amazon.com.

This week, The Simple Dollar is running a short series on some of the key moments in my financial turnaround and how you can experience those moments as well. For a full description of this, see the first article in the series.

As I began to get my financial situation under control, I began to find a few new problems.

First and foremost, even though I knew it made sense to start saving money regularly, actually making myself do it every week was a trick. I would often forget about it, or I’d talk myself out of it when the time came, convincing myself to throw it toward a debt or some other goal.

Second, I was simply not very organized when it came to bills. I’d get a bill in the mail and put it in a place where I’d hopefully remember it when it came time to pay bills, but even then, bills would sometimes slip through my fingers due to simple forgetfulness.

Thankfully, I found a very simple solution to both problems at once.

Bank on Autopilot
To put it simply, I began to trust my bank to handle both of these things for me.

Of course, in order to actually do this, you must have a bank with a robust online banking system. You need the ability to pay bills directly online as well as establish account-to-account transfers online. I use ING Direct, which allows both quite easily.

The first step I took was to simply set up an automatic weekly transfer from the primary checking account to a savings account. At first, it was a small amount, but over time it grew and grew. Eventually, I added transfers to other savings accounts for other goals, transfers for my children’s 529 accounts, and so on.

The key is to start off with small amounts that aren’t disruptive to your regular finances. You don’t want to start off with an amount that will force you to stop the transfers because of inadequate funds. Start with a small amount, then build from there.

Many people are hesitant to even start because they’re afraid of overdrafting. If that’s your concern, then the problem isn’t with the automatic transfer. The problem is with other money management choices in your life – bad spending decisions and so on. If you’re not willing to save for the future, your life will always be like the present.

The second step was to automate regular bill payments. Right now, I automate almost every bill we have save our energy bill and our cellular bill. Every other bill is a regular amount, so I have our bank set to automatically pay these amounts on a schedule. I don’t have to lift a finger for our mortgage payment, our insurance payments, our trash removal, our water and sewer payments, or anything like that. It’s all automatic.

Both of these moves contributed greatly to my personal finance success. The first one pushed me to start building a strong emergency fund and, eventually, to save for other goals. The second one helped me to get more efficient with my bill paying tactics, leaving late bills in the dust.

Simple moves, big improvements. That’s the kind of personal finance that can change a life.

This week, The Simple Dollar is running a short series on some of the key moments in my financial turnaround and how you can experience those moments as well. For a full description of this, see the first article in the series.

At the low point of my personal finance situation, I spent a long night sitting with my infant son in a dark room, wondering what would happen next. It was during that night that I realized I was failing that poor child and that I needed to start making better decisions with my life.

It wasn’t just my son, though, that convinced me to follow a different path. My wife played a huge role, as did the children we had later on. My close friends played a big role, as did my parents.

It was the sum of all of those relationships that pushed me to make some major changes in my life. It was not a matter of wanting to disappoint them or to make them proud. It was my desire to always hold up my own end of the bargain that was my relationship with each of them.

Bankruptcy and financial despair did not equate to me holding up my end of those bargains.

Who Do You Love?
The real value of this understanding came from looking seriously at my life. Who were the people that genuinely cared for me? Who were the people that I was genuinely responsible for? In other words, who were the core people in my life that I truly loved and who truly loved me, and what did that really mean?

It’s an interesting question, isn’t it? What does it mean to have someone out there that you really care for – and that really cares for you? Your parents. Your spouse. Your children. Your closest friends. What does that relationship actually call you to do in your own life?

As I thought about each of the key people in my life, I began to see that, over and over again, improving myself improved my relationships with each of those people.

Improving my financial situation helped me to provide for my children and helped me to make a better life for my wife. It also helped me to add to the long-term sense of security felt by my parents.

I could make similar statements about various other aspects of life, from improving my own health, improving my own attitude and social skills, and so on. In each case, self-improvement led to better relationships.

How do you start down that path? Put aside a moment and make a list of the people you genuinely love – and you know genuinely love you. It might be a long list, or it might be a very short one. In either case, simply write down those names.

Now, look at each of those names and think to yourself how that relationship is improved simply by your improvements in managing your finances. You’ll be surprised how many good things simply come from this one personal change. You can also look at that list through the eyes of any other personal improvements you want to make.

For me, I found great value in putting pictures of those loved ones in key places, like taped to the bottom of the rearview mirror in my car or wrapped around my credit cards. Seeing those images would remind me of my relationships to these people – and how those relationships benefit from sensible personal finance choices from me.

Each week, I highlight ten things each week that inspired me to greater financial, personal, and professional success. Hopefully, they will inspire you as well.

1. Vidal Sassoon on success and work
This is a great little quote.

The only place where success comes before work is in the dictionary. – Vidal Sassoon

Vidal Sassoon was an orphan who put an obsessive amount of work into building a hairdressing empire. I think I’ll take him at his word on this one.

2. Zeer
I’ve found myself using this tool a great deal lately. Zeer lets you see the Nutrition Facts label for almost any food product you can imagine. Using this in conjunction with grocery list planning has helped our family make some healthier purchases without skipping a beat.

3. Chrysanthemums (1898) by Paul Cezanne
For some reason, I’ve been attracted to paintings that depict flowers and springtime lately.

I rotate my desktop wallpaper on my computer all the time, often using great paintings for the background. For the last week or so, it’s been Cezanne.

4. Thomas Edison on failure
A failure is not the end. It’s the beginning.

I have not failed. I’ve just found 10,000 ways that won’t work. – Thomas Edison

You just have to be willing to pick yourself up off the floor and keep on moving.

5. Life and Music by Alan Watts
Lately, I’ve been really enjoying some of the audio recordings of Alan Watts, a British speaker and philosopher. This is a great little piece (the audio part, anyway).

If you don’t see the video above, you can watch it here.

6. Napoleon Hill on sacrifice
I know what he means here.

Great achievement is usually born of great sacrifice, and is never the result of selfishness. – Napoleon Hill

There is nothing in this world that comes easy. If you want success, expect many years of constant failure first.

7. Steve Jobs Stanford commencement speech 2005
I’ve been watching a lot of commencement speeches lately (wonder why…) and this is the best one I’ve yet found.

I hope to someday deliver something a tenth as inspiring as that.

8. Dropbox
Dropbox is just incredibly, insanely useful. I use it for countless little things, from sharing documents between my desktop and laptop computers to sharing documents with collaborators halfway across the country. It’s just like a magic little folder on my computer that appears everywhere I’m at.

9. Alan Bond on luck
Again, touching on the “hard work” theme:

I’ve always worked very, very hard, and the harder I worked, the luckier I got. – Alan Bond

Luck is usually an outgrowth of a lot of hard work. Hard work sets the foundation for luck to grow on.

10. Kseniya Simonova’s “You are always nearby”
This is an amazing video showing a young Ukranian woman telling a heartwrenching story about a couple torn apart by World War II using nothing but sand, a lightbox, and music.

It’s just mesmerizing and brilliantly executed. Another work by her, about parents, is similarly compelling.

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.

I love Italian food. Sure, it can be pasta heavy, but it’s also often heavy on the fresh vegetables and the herbs, creating some delicious tastes, amazing aromas, and surprisingly healthy dishes.

One dish we often make is what we call, in our own slang, “pesto pasta.” Basically, we just make up a batch of pesto, which is really easy, then we cook up whatever pasta we have on hand. We mix the two together, serve them with a side vegetable, and enjoy. I can bring this meal from idea to the table in fifteen minutes, and the cost isn’t very high, either.

What You Need
Obviously, you’ll need some sort of pasta. Pesto clings to almost any type of pasta, so I usually just use whatever we have on hand.

There are infinite varieties of pesto, so for this recipe, I’m just going to use the most basic kind of pesto, known as “pesto alla genovese.”

All you need is 1/2 cup extra virgin olive oil, about 1 cup of basil leaves (or 1/3 cup dried basil), 1/2 teaspoon salt, a dash of black pepper, a teaspoon of minced garlic, and two tablespoons of either walnuts or pine nuts (the picture above uses pine nuts). You’ll also want to add 1/4 cup Parmesan cheese if you wish, but it’s pretty tasty without it.

The ingredients add up to a couple dollars, but they make for a spectacular dish.

The Night Before (or Early That Day)
Making the pesto is easy and it can be done a day in advance.

All you have to do is tear up the basil leaves into small bits (if you’re using fresh basil, that is) and add it to a blender or food processor. Add all of the other ingredients except for the olive oil, then add a small portion of the oil. Blend for a few seconds, then add a bit more oil. Repeat until all the oil is added, then pour/scrape the pesto out of the blender.

You’re done. That’s it. Put the pesto in a small container and stick it in the refrigerator.

Preparing the Meal
I like the pesto slightly warm, so I pull it out of the refrigerator and heat it gently before the meal.

At the same time, I cook the pasta according to the appropriate directions, then drain the pasta. I then mix the pasta and pesto together until the pasta is coated, then serve it with a side of vegetables.

In this case, the side vegetable was some leftover broccoli and cauliflower from an earlier meal.

Optional Ingredients
The pesto itself is incredibly flexible, with thousands of variations.

Pistou consists of just olive oil, basil, and garlic, and is quite delicious. Pesto alla siciliana adds one cup of diced tomatoes, replaces the nuts with almonds, and uses only 1/4 cup basil leaves (or 1/8 cup dried basil). Other ingredients to try include grilled bell peppers, black olives, lemon peel, coriander, mushrooms, and miso paste.

Of course, you can also prepare this with a meat in addition to the sauce. Chicken is particularly good with pasta and pesto sauce.

This week, The Simple Dollar is running a short series on some of the key moments in my financial turnaround and how you can experience those moments as well. For a full description of this, see the first article in the series.

My weekend planning has always followed the same general structure (at least since I graduated from college). I’ll sit down with Sarah on Friday evening, we’ll throw a few ideas off the top of our head, we’ll pick one or two of them, and that’s what we’ll do. Saturday and Sunday follows that same general structure, though Saturday’s options usually revolve around chores.

Before my financial recovery, the options we’d throw out were often expensive ones. “Let’s go golfing Saturday afternoon.” “How about we go over to Jordan Creek on Sunday?” (Jordan Creek being the relatively expensive shopping area in the Des Moines Metro.) “How about dinner and a movie on Saturday night?”

The problem was that by just relying on the ideas that came off the top of our head, we were by default preloading ourselves with activities that were fresh in our minds from marketing. We’d listen to the radio on the way home on Friday night and hear talk of a great new movie or restaurant. I’d drive by the golf course on the way home. She’d hear an ad for Jordan Creek on the radio.

Since these happened to be the easy ideas to recall, they were usually the ones we did. It wasn’t because they were the “best” options, they were just the options that popped into our heads.

I know that my parents did much the same thing. I also know that a lot of our friends did the same thing, too.

So, what’s a better solution?

Make a Weekend Plan
The approach that works best for us is simply “pre-loading” our usual weekend activity brainstorm with activities that are free or extremely low-cost.

Of course, to do that requires both some forethought and some research. My solution to this is to simply keep a “note” on my phone that lists such activities.

How do I find them? It’s pretty easy – it’ll only take a minute or two with your web browser by just visiting three websites.

First, visit the website of your municipality’s parks and recreation department. Many cities have parks and recreation departments that have lots of free activities for all skill levels. You can also find out about trails, facilities, parks, and other such features of your community that you might not know about that are well worth exploring and utilizing.

Next, visit the website of your municipality’s library. Libraries have tons of resources available to you for free if you just step up to the plate and take advantage of them. Free books, free CDs, free DVDs, free magazines, free classes, free meetings – it’s all there, just waiting to be used.

Finally, look for the “community calendar” for your city. Just search for the name of your city in Google and add the phrase “community calendar” behind it. You’ll find a listing of great activities in your area going on in the near future, many of which are free.

Beyond that, you should try similar searches for communities near you. We often utilize resources in neighboring communities and often use things in the Des Moines area as well.

Of course, while I’m doing this, I’m usually taking some notes. Even better, I’ll do this while Sarah and I are brainstorming. Instead of merely relying on whatever half-baked ideas pop into our head, we turn instead to some options that aren’t expensive.

That doesn’t mean we don’t do anything “fun,” which is a response I often hear to suggestions like this. All we do is look at the free activities first. If one of them registers as “fun” to us – and one of them usually does – we do that. That way, we’re doing something fun without spending money.

Even better, this contributes to a sense that not spending money is the norm, and that spending money is the abnormal activity, which is also something worth demonstrating to our children.