Every once in a while, I’ll go through a short phase where I become obsessive about books, particularly ones not found at my local library. I’ll hit PaperBackSwap hard and sometimes even splurge at the bookstore, picking up several books in a short period. This actually happened fairly recently, thankfully fueled by gift certificates and coupons at Borders.

Yet, as I sit here, I think about books I’d like to read. I’d love to have The Brief Wondrous Life of Oscar Wao on my reading pile, but the wait list at the library is nearly infinitely long. I also have this big pile of books right here that seem equally compelling. Yet there’s this whisper in my ear. It’s only $11.20 at Amazon. You can easily afford it. Just order it.

Why do I feel compelled to do this? I usually have a small mountain of books at home waiting to be read. Right now, my “to-be-read” pile is enormous - it would easily take me three or four months of sustained reading to get through the pile. It occupies an entire shelf and part of a second shelf in my office.

When will I have enough books? What is enough?

In Your Money or Your Life, Joe Dominguez hits upon the idea perfectly on page 27 with his description of a “gazingus pin”: “A gazingus pin is any item that you just can’t pass by without buying. Everybody has them. They run the gamut from pocket calculators and tiny screwdrivers to pens and chocolate kisses.”

For me, it’s books. Although I’ve found creative ways to really stretch my book dollars (relying on willpower, avoiding bookstores, using PaperBackSwap, routinely emptying out my book collection, and so on), I still have this incessant desire to pick up books.

It’s time to face facts. It’s an addiction. One that creates a slow leak from my wallet.

And, with any addiction, there’s no time like the present to stand up and do something about it.

Starting today, August 5, I will not buy any books for one year, excepting gifts for others. Not a dime on books of any kind. Instead, I’ll get through the books I have to fuel my reading habit and also rely on my local library and any other sources I have for free books.

This is going to be rather hard for me, considering that books are by far my biggest remaining splurge item. But time after time, they feel like a splurge that’s out of my control, one that just keeps sucking away money.

Here are some of the tactics I’m going to use.

First, a moratorium on bookstores. I’m going to stop going to bookstores entirely, even though I love browsing through them. Why? Every time I go in, I always seem to leave with a purchase or two.

Second, a commitment to reading through what I have saved up before acquiring or even checking out any more books. I have a giant pile of books to read on my own bookshelf. No more new books until I’ve run through all of those.

Third, a “want-to-read” list that I don’t act on until next August 5. I usually jot down books I want to read on my pocket notebook when I hear about them, then investigate them later on Amazon or at the library or bookstore. Instead, I’m just going to keep a list of them on my computer, not to be acted on until next August 5.

Now, let’s turn the tables.

What’s your little weakness, your “gazingus pin”? What thing can’t you help but buy? How much is it really costing you each month?

Even better, can you stand up alongside me and give that thing up for a year, too?

Let me know in the comments. I think both of our wallets will be better for it.

Quite often on The Simple Dollar, I’ll mention the advantages of getting your debt paid down. For most debts, paying them down is the best thing you can do with your money, provided that you have a small emergency fund set up to protect yourself against the unforeseen and at least some retirement savings.

As soon as I mention this, however, a number of commenters will show up and claim that debt is great as a leverage tool, that it’s free money if you can reinvest it and earn more than the interest rate.

Here’s the way I look at it: if you’ve already incurred the debt, an extra debt repayment is an investment an after-tax and almost risk-free return equal to the interest rate on your debt.

Here’s an example. Let’s say I have a home mortgage at 6%. If I make an extra mortgage payment on that debt, every extra dollar I invest will return 6% after taxes to me over the life of the loan. Similarly, an extra payment on a 13.9% credit card debt will return 13.9% after taxes to me over the life of the loan.

This is not to suggest that debt itself is a good thing. You’re far better off saving up money for big purchases in advance than you are taking out debt to buy the items. For example, if you know you’re going to buy a $10,000 car in two years, your best move is to start putting $400 a month into a savings account right now, which will add up to nearly the cash value of the car. Otherwise, you’ll be saddled with a $10,000 loan, which will equate to approximately $250 a month payments for four years - far more money spent than if you’d saved in advance.

Let’s look at comparable investments. The only investment available to most people where you can put in after-tax money and not have to pay taxes on the return is a Roth IRA, but it has the restriction that you can’t take your earnings out until you’re 59 1/2. Also, some municipal bonds earn tax-free income, but they generally have low rates of return - 3% or so.

Almost every other investment vehicle requires you to pay capital gains tax. Money in a savings account? You’ll be paying short term capital gains taxes on that - basically, your normal income tax rate. Money in an investment? You’ll pay short term capital gains on any dividends you get and also on any investments that you sell within a year - you’ll pay long term capital gains tax on ones you sell after owning them for more than one year (that’s 15% for most people).

Even worse, returns on most investments aren’t guaranteed. Almost every investment option that earns over 5% does not have a guaranteed return - they’re usually based on the fluctuations of the bond market, the stock market, the real estate market, or so on. Because of that, by owning the investment, you’re taking on risk that you wouldn’t have by repaying your debt.

Let’s look at an example. Let’s say I have a debt on a big furniture purchase that’s sitting there at 7%. Every extra payment you make on that debt is the equivalent of a 7% investment with no risk.

If you’re in the 28% tax bracket, in order to beat the debt repayment in a savings account, you’d have to find one earning 9.72%. Even an investment earning only long-term capital gains tax, you’d have to find a riskless investment that earned you 8.24% annually - not going to happen.

You shouldn’t pay down your mortgage or your student loans because of the tax benefits! Yes, some debts have tax benefits and those should be looked at carefully - but not overinflated. On student loans, you can deduct the paid interest each year, but all extra payments will do is reduce the amount of interest you pay in future years, just slightly reducing your deduction there. On home loans, most people look at the deductible amount of their interest, but they neglect to look at the fact that they can deduct a good chunk of that anyway via the standard deduction - their actual extra deduction due to their house is often much smaller than they might think.

It is never a mistake to pay down debt. Sure, one can formulate situations where you might earn a bit more by doing credit card balance transfers or only paying the minimum on a very low interest debt, but those situations are few and far between, have other risks (such as unexpected changes to terms and conditions and a mis-step in managing the accounts) and don’t earn you a whole lot.

In my view, debt repayment should come fourth on your financial to-do list. First, spend less than you earn every month and master it - stop building more debt right now. Second, get yourself an emergency fund - preferably a couple months’ worth of living expenses for each dependent - and keep it in a very liquid place so you can get it when you need it. Third, save for retirement. Fourth, get rid of your debts - at least those over 5% or so.

Follow that game plan with all the passion you can muster. If you can check off all four of these, then it’s time to start looking at investing and other options. That’s how I’m rolling - I’m deep into step four and already looking ahead at a bright future without debt.

Just try this little experiment tomorrow.

From the very start of the day, keep a little notepad with you and jot down everything that makes you feel genuinely happy inside. Don’t worry about whether it’s something big or something small - if you feel a twinge of happiness, jot it down.

Then, a day or two later, do it again. Make four or five little lists of the things that made you feel happiness during a given day - the things that made you feel good.

By now, you’ll have a few nice little lists. Go through them and eliminate any good feelings that make you feel bad when you look back on them, like silly frivolous purchases that were a rush when you made them but now feel like a waste to you.

The items remaining are a collection of the good things in your life. These are the things that bring you joy on a regular basis and provide the fuel for you to keep going.

Here’s my list, for a recent day:

+ The shouts of my son and daughter through the baby monitor in the morning as I lay next to my wife listening to them
+ Three minutes of wonderful stretching
+ The taste of a really fresh bagel with cream cheese on it
+ The success of finishing a very long article
+ A warm and unexpected hug from my wife
+ An hour of uninterrupted reading of a book I love very much
+ Dancing around in my office (with the door shut) to “Let There Be Rock”
+ The pleasure of making a loaf of bread
+ Cheering up an old friend
+ Playing tee ball in the yard with my son
+ A lengthy babble conversation with my daughter
+ Watching a movie while sitting nest to my wife as she rests her head on my shoulders

What’s to note here? The only ones that directly involve purchases are the bagel, the book, the bread ingredients, the tee ball equipment, the movie, and the music - everything else was either completely free or only involved purchases on an indirect level. Even those purchases are a little bit fuzzy - the tee ball equipment was a gift for my son from his grandparents, the movie came to us from SwapADVD, and the book came from the library.

To put it simply, the things that day that brought me lasting happiness didn’t cost much money at all. These are the spices of my life - the things that make my day to day life enjoyable - and they don’t have much to do with spending money at all.

The next step is to learn to focus on these things. Obviously, from this list, one can tell I’m passionate about my family and close friends, reading, writing, and food - they bring joy into my life on a daily basis. What things can I do that give me the most opportunity to really enjoy those things?

Organize your time to maximize those experiences. If you really get enjoyment from reading a great book but feel indifference from television, turn off the television and read a book. If you truly enjoy time with your family, spend times when they’re not available busting your tail to get your other chores and tasks done so you can spend more time with them when they are available. If you enjoy food, spend time learning how to make great food at home - it’s really not as hard as it seems and it’s pretty cost-effective, too.

What if one of the things I deeply love is quite expensive? It’s likely counterbalanced by simple things that aren’t nearly as expensive. Just keep it in balance - don’t focus on the expensive passion. Mix up your life a little - mix golf with walking around in nature. Mix clothes shopping with exercise. Also, find ways to channel that love into something less expensive. If you’re passionate about golf, don’t buy new clubs and go golfing at the local community course - you can still get the rush of the tee shot to the green with your old clubs at the community course. If you’re passionate about clothes, be more careful and well-researched about your clothing picks and shop for the big bargains at lower end stores - you can get a huge rush out of finding an amazing item in an unexpected place.

For me, it’s all about finding time to read and maximizing my time with my kids instead of doing more expensive things that I’m less passionate about. That’s done more than anything to keep my spending in check.

A few days ago, I wrote a post where I responded to a reader who felt I had nothing to offer her because my income was significantly higher than hers. I strongly disagreed - I feel very much that the principles of personal finance apply to everyone. I used the example of sharing money-saving tips with my parents, who earn significantly less than I do - we both benefit from a lot of these activities. Similarly, my father is an entrepreneur who has a thriving fishing and gardening side business - he doesn’t have a big bankroll, but he has passion. I learned entrepreneurship from him and it led me to have the courage to start The Simple Dollar and run with it.

Underneath that, though, Marjorie did have another interesting point worth discussing. There are simply some people in very difficult financial situations that I can’t help. If you are in a position where your earning potential is low and you have to work every spare minute to make ends meet, the idea of shaving a few dollars from your budget to help keep yourself above water is laughable. Most people in low-income situations already follow most of the frugality tactics I mention, not because it’s a good way to help get themselves in better financial shape, but out of pure necessity.

Larry Winget, in his very solid personal finance book You’re Broke Because You Want to Be, hit the issue right on the head. He made a distinction between the idea of being poor and the idea of being broke in a very clear way. Here’s what he had to say:

Please don’t say, “But what about the poor people, Larry? They don’t want to be broke.”

Great point. You’re right. I’m not talking about being poor.

Poor is a condition I find very sad. Sad, yet inevitable. Jesus said, “The poor will be with you always.” And they will. There are people who live in soicieties and countries where there are no opportunities for advancement and it takes all their effort just to survieve. They are not going to have enough to eat well or live well or take care of themselves.

So let’s get this straight from the outset so you can get off your high horse and understand what I am really saying. I didn’t write this book for the poor people of the world. I know it is going to take a lot more than a book to help truly poor people. To think otherwise would be insulting.

I am talking about broke. Broke is not a condition like being poor. Broke is a situation you find yourself in because you are either underearning or overspending.

In short, being poor means that you don’t have the resources available to you to improve your financial situation. For some, this may mean a personal challenge, such as a learning disability or physical disability. For others, it may be a confluence of events in life that close doors to progress, such as having children before you’re adequately prepared. I know some people in these situations and I know that there are many more in this group throughout the world. It will take some significant social progress to reach these people

Poverty is not something I can help. It’s something far beyond the ability of an internet blog to help. It requires significant social change and a very large commitment to lift all of the boats in the world. If I want to actually help with poverty, I can go over to the food pantry and help gather for them, I can donate some of my financial gains to charities that help with poverty issues, or I can get involved in political causes. No list of “tips” I can write can help with genuine poverty.

On the other hand, being broke means that you do have resources available to you to help improve your financial situation, whether you see them or not. This is usually due to a lack of personal finance education, poor time management skills, a lack of willpower, and so on. What I’ve found is that almost everyone who can access The Simple Dollar falls into this category - they have some resources somewhere that they’re not utilizing well, and by utilizing them better, they can achieve their dreams.

Being broke is something I can help. I can offer up my own experiences in a very detailed fashion. I can suggest fixes that work in a wide variety of lifestyles. I can offer all kinds of insights on how to better manage your time and how to use that excess time to increase your income.

If you’re reading this, you’re probably in the “broke” boat, were in the recent past, or desperately want to avoid ever going there. Welcome aboard. Let’s sail beyond the sunset together.

Yes, some people can fall into both camps. They are in a situation without many resources to spare and because they’ve been led to believe they can’t succeed, they don’t believe in those resources and don’t believe in themselves. I know some people in just this situation - they believe they’re in the “poor” camp when they’re actually in the “broke” camp. I would rather reach these people more than anyone else, and that’s why Marjorie’s email struck such a chord with me, because I believe she’s in this group.

The fact that some people have resources and some people do not is a very broad societal issue, one I can’t hope to solve. All I can do is try to reach out to the people who have resources available to them and help them to discover how to really use those resources. I don’t profess to have any kind of solution for any greater societal problem, but I do find a lot of value in helping people find ways to succeed themselves.

After my recent article about how to deal with a partner that hides and lies about money problems, several readers made the astute point that many of these situations are often the result of people lying to themselves about money, whether directly (by actually telling yourself false conclusions about the facts you already know) or indirectly (avoiding the facts).

I used to often lie to myself about money. I’d buy things on the credit card without checking balances or considering the consequences, believing it wasn’t that big of a deal or that I could easily afford it later. Sometimes, I’d figure out my complete financial state, know on some level that it was atrocious, but tell myself that it wasn’t bad and that I had things under control.

Here are some of the tactics I used to overcome that tendency to deceive myself about my financial state. Without these tactics, it would have been much more difficult to turn my financial life around.

First, realize what you’re doing
If you don’t recognize a problem, you’re going to go on deceiving yourself and digging yourself into a deeper and deeper financial hole. Here are some of the big warning signs to look for:
+ Do you often feel like you have to “justify” purchases because your brain tells you you can’t afford them?
+ Do you avoid looking at bills and financial statements?
+ Do you tell yourself that your “future self” will take care of this bill?
+ Do you try to block thoughts of your debts and budgeting out of your mind when you want something?
+ Are you often “surprised” by your credit card bills, but you don’t even think about the bills when you bust out the plastic?
+ Do you tend to believe you’re more well off than you are when you’re out in public buying stuff than when you’re looking at your bills?

If any number of those are true, you’re either directly or indirectly misleading yourself when it comes to your financial state, and that directly leads to financial trouble.

The first step is to simply realize you’re doing it - and to realize that it’s not helping you with financial success.

Figure out the truth
The next step is to figure out your exact financial state so that you can see the raw numbers. This means facing those bills that you dread and coming to terms with the fact that your income isn’t really matching your spending.

One good way to do this is to tabulate all of your spending for a given month. Go through all of your receipts and statements and determine where exactly every dime went for the past month. Group them together in obvious ways - all spending at each store, or all spending at each type of store, for starters. A person who just gets a coffee each morning might be able to tell themselves it’s not a problem, but looking at a pile of 23 charges to the local coffee shop for $8 to $10 a pop might make things look different - that’s a car payment. Four clothing binges? That’s a problem.

Another method for seeing everything at once is to calculate your net worth. That means tallying up the value of all of your assets, then subtracting from that the total of all of your debts. What’s left might actually be negative, which means that for all of the time you’ve spent working in your life, you’ve actually accumulated less than nothing.

These numbers are the truth of the matter. The truth is not the story you’ve created in your head. Look at these numbers carefully, and figure them up on a very regular basis so you can see the exact effect of the bad choices you make on your financial state.

Create some reminders
Once you’ve figured up these numbers, you may want to just push them out of your head and forget about them. Don’t. Put a copy of your net worth balance sheet up on the fridge and on the dashboard of your car. Wrap a note around your credit cards saying “I spent $800 on stupid things last month - that’s more than a week’s worth of pay.”

The key is making the truth so prevalent that you can’t avoid it. If the truth is around every corner, the lies have nowhere to hide.

For me, the most powerful reminder was a picture of my children wrapped around my credit card. My son keeps me honest with myself - I know that every bad financial move I make means fewer opportunities for him as he grows up.

Try a “cash only” spending plan for a while
Another tactic to enforce honesty is to switch to a “cash only” policy for spending. Whenever you intend to make a purchase, do it with only cash. This means using the ATM machine and keeping cash in your wallet for any purchases you might make. To enforce this, start keeping your credit card at home or keep only a low-limit one in your wallet for emergencies.

This keeps you honest in the sense that once there’s no money left, there’s no money left. You can’t deceive yourself because of the availability of credit - the amount of money you have is really all you have.

Be fully honest with at least one other person
One other tactic that’s fairly surprising but really helped me to face the truth of my situation was full honesty with another person.

When we faced our financial crisis in April 2006, I spent some time assembling all of this information about our financial state. I found out how much we owed on all of our debts, figured up our net worth, and put together a vague plan for what we needed to do.

Then I took the big step. I shared all of this with her. We sat down and went through everything. I showed her a complete picture of our financial state. We talked about our goals and what we wanted from our lives. We started to look for some solutions, too.

The most powerful part, though, was revealing all of the bad moves to my wife. She had a sense that we were in a difficult financial shape, but she really had no grasp as to how deep our financial troubles went. By showing her the whole picture, it went from just being something I could keep to myself and hide from others to being something that someone else knew about. She now knew the whole truth, just as I did, and thus any statement or action I made with regard to our money not only had to pass through my own sense of truth, but it had to pass through hers as well.

In short, she became a much higher standard of honesty about money. It’s a lot harder to deceive yourself if you know that deception requires you to also deceive the people you love the most. By opening the whole of our finances to her, any lie I told about our money, even to myself, became much the same as lying to her, something I can’t stomach.

Find someone you trust deeply and value deeply and open up your situation to them. You’ll find that you’ve committed yourself to a deeper level of honesty and it will push you to a higher standard than before.

Set microgoals
Pledge that you’ll get through just the next day without spending dishonestly. Take it one step at a time, and renew your honesty at the end of each day by taking a sincere look at what you spent that day. Then repeat it the next day. Start a journal about your progress, writing down the successes and the challenges of each day.

Eventually, you’ll come to truly trust yourself again. You’ll find that you’re naturally moving to a state of internal honesty, and that makes it much easier to be truly honest with others. That honesty about money will also lead you straight towards financial success, as you’ll be connecting the consequences of your spending with the rewards of getting things under control and building a surplus.

One major theme I’ve observed in a large number of recent personal finance books and articles is the idea of valuing experiences over things. For example, it’s more financially sensible to lead a spartan life filled with many memorable experiences than it is to subscribe to the consumer lifestyle. I’ve hinted at this concept several times recently, in my discussion of saving to splurge as well as my review of The 4-Hour Workweek.

On one level, this makes a lot of sense. In your final years, you won’t want to look back on a life that was spent accumulating stuff. Instead, you’ll want to look back on a life well lived, one filled with all kinds of interesting and valuable experiences. Life isn’t about the stuff you have, it’s about the things you do.

There’s only one problem with this philosophy. It’s just as prone to overspending as accumulation of stuff is.

I think back to the amazing honeymoon I had with my wife in the summer of 2003. We went to London, stayed in a hotel room overlooking Hyde Park for a week, and strolled to everything we wanted to see in the city. Then we stayed in Manchester for a few days, then a few days in Inverness, then a final night in London. It was unforgettable, but we spent money like it was water on the whole trip - the total bill ended up being in the low five figures. The summer after that, we spent about a week and a half in the Seattle and Victoria, B.C. areas, spending about $4,000 on a very memorable trip.

In short, the “experience”-based lifestyle is just as prone to overspending as the “stuff”-based lifestyle. You can just as easily blow thousands of dollars on your home entertainment center as you can on a memorable trip.

The key to keeping the experience-oriented lifestyle within reason is the same as keeping the item-oriented lifestyle in reason - frugality. Just as with shopping for the best deals on items, you can also do some careful planning and get the maximum value for your dollar when it comes to memorable experiences. Here are some ideas.

Don’t set the bar for enjoyment beyond what’s reasonable. My wife and I were in great danger of doing this with our London trip - we set the bar for memorable experiences pretty high with that one and we tried to compete with it for the next two summers. While it’s great to occasionally have a truly monumental experience, don’t try to make every other experience match up to it.

What really worked for us was spending three straight summers since then with only extremely modest trips - a camping trip to the Great Lakes in 2006, nothing at all in 2007, and a week along the shores of a nearby lake in 2008. Those experiences were highly enjoyable but didn’t break our finances, either.

Use the peak-end rule to your advantage. The peak-end rule states that your later judgment of an experience is mostly made up of the peak of the experience as well as how you felt at the end of the experience. That means that a trip where you jam every day full of activities isn’t really going to build a ton of great memories. Instead, make the days more leisurely and focus on having two great experiences - one in the middle of the trip and one at the end.

This actually works. My memories of the Seattle trip are really defined by two experiences - visiting Butchart Gardens (peak) and visiting an amazing bonsai garden (end). My memories of our London trip are mostly defined by visiting Parliament (peak) and a long train ride from Inverness to London where my wife slept on my shoulder and I looked at the countryside (end).

Fill your life with lots of enjoyable smaller experiences. Instead of blowing huge amounts on jaw-dropping experiences, fill your spare time with experiences that fulfill you deeply without emptying your bank account. Spend more time with your kids. Explore the nature near you. Go on shorter trips and discover the beauty and activities available in your own state that you’ve never discovered. Try some new activities that are outside of your comfort zone wherever you are.

For me, the most memorable experiences of this summer are ones that cost very little: playing Calvinball with my son, rolling over and over in the grass with my infant daughter, going to dozens of little community festivals and participating in the cultural activities, biking to the park regularly for family picnics, and so on. These things didn’t have much cost at all, but they’ll be what I remember from this summer and they’ll be very happy memories, right along that top shelf with visiting Parliament with my wife.

Why? The real key to making memorable experiences isn’t in blowing wads of cash on amazing peak experiences. It’s in figuring out what truly makes you happy and making that central in your life. I can name on one hand the things that make me the happiest - writing, playing with my kids, cooking and enjoying good food, and reading. Those things make me happier than anything else, and when I surround myself with them, I find tons of great and memorable experiences without spending much at all.

In the end, then, the real key is to find the elements of your life that make you happiest and make those elements the center of your experiences. The best part is that it doesn’t have to cost much at all and it will put you on the path to leading a memorable life.

This morning, my wife and I sent in the final payment on her student loans, which was our primary personal finance goal for 2008 and our highest interest outstanding debt. It felt good. Really good.

Our next personal finance goal is to pay off my remaining student loan, which has an outstanding balance of $14,800 or so. This was the goal we had penciled in as our primary goal for 2009, intending to pay it off by the end of that year. Paying off that debt will leave us with only our mortgage as debt.

Rolling back the clock just twenty seven months really puts this financial turnaround in perspective. My wife had roughly $24K in student loans, all told (now paid off). I had $10K in one student loan (already paid off) and about $25K in another loan (now below $15K). We also both had significant amounts remaining on our separate car loans - I owed at least $5K on my truck at that point (now paid off), and she owed at least $2K on her car (also paid off). We also had a combined $17K (approximately) in credit card debt.

Adding that up means we’ve paid off a stunning $68K in debt in a little over two years. For comparison’s sake, our debt repayment is roughly equal to our 2006 income and not too much lower than our 2007 income, which should give a good idea of how hard we’ve pushed the pedal to the floor since our meltdown.

Now, we just have the remainders of my single remaining student loan and a mortgage to pay off. That’s all.

How did we do it? I’ve written about this a number of times, but it’s just as true now as it was then. We took a hard look at our financial situation, realized we were simply spending far more than we earned, and pushed ourselves - and each other individually - to turn that ship around. We sold off mountains of video games and DVDs and trading cards. We adopted much less expensive hobbies. I began to look seriously at alternative avenues for raising money in my spare time - at first, it was repairing computers, and then I began to have some success as a writer as well. We started preparing food at home instead of eating out most of the time. We made a debt repayment plan and started snowballing our payments, meaning as soon as one debt was paid off, we transferred that whole payment as an extra payment on the next debt.

The most important thing of all, though, was realizing that we needed to turn things around for each other and for our children. Spending far more than we earned was creating a dangerous path for our future, one that simply couldn’t continue.

We use each other as inspiration to push ourselves harder to save money. If my spouse has the financial strength to do it, so do I. If our children have a life of rich and full experiences and they’re emotionally centered, then we’re doing our jobs as parents, even if they don’t have the latest and greatest of everything.

But, for now, it’s time for us to celebrate a little in the way we’ve become accustomed to. A pair of steaks from the freezer are thawing and soon I’m going to go harvest some lettuce from the garden and maybe a fresh tomato or two, plus there’s a bottle of homemade blackberry wine that will be opened up and poured as a dessert drink. An amazing dinner, not much different than what we would have spent a lot of cash on a few years ago, but instead prepared and eaten at home, together, as a family.

Marjorie wrote in recently:

I used to enjoy The Simple Dollar until I read about your recovery from credit card debt. You paid off $17,000 in credit card debt in a little over a year? You’re not a poor person, you’re a rich person. You don’t have financial problems and you can’t relate to my situation. I will have to find another website to read.

I receive a comment like this once a week or so. Usually, I brush off the negativity and move on with life, but Marjorie’s comments really struck a chord with me, so I thought I’d address them.

The Simple Dollar has very little to do with “rich” or “poor.” It’s all about spending less than you earn, regardless of how much you earn.

Whether a person makes $20,000 a year or $200,000 a year, a person can save money by following the same basic frugal steps. The high-income person saves just as much at the store clipping coupons as the low-income person does. The low-income person puts just as much cash in their pocket from turning off light switches as a high-income person does. For both, it’s a struggle to overcome the temptation of spending money unnecessarily. For both, it’s a challenge to put away money for the long term when there are so many potential uses in the short term.

Naturally, there are some opportunities available at each income level that aren’t available at other ones. Families with $20,000 a year in income are going to be eligible for certain types of aid. Families with $200,000 a year in income are likely going to be choosing among purchases that aren’t available to the lower-income family.

But the principles don’t change a bit. Both families should seek to spend less than they earn. Both families should always strive to get the most value from their dollar. Both families should always seek to improve themselves using every opportunity available to them.

Here’s another truth: if you don’t understand the basics of managing your money, it doesn’t matter how much you make - you’ll wind up deep in debt. If you don’t manage your money well, it’s very easy to spend significantly more than you earn, no matter your income level.

People at every income level have difficulties managing their money. Simply having a strong income doesn’t mean you suddenly have the ability to manage that income well. I’ve had people write to me earning minimum wage and wondering how they’ll ever pay off a $6,000 car loan. I’ve had others write to me making $500,000 a year but having more than a million dollars in total debt. Both of those people are going to have a difficult road ahead and both are going to have to make some very difficult choices in the coming months.

To say that people at other income levels don’t have financial problems is a class-based insult. People at all income levels have financial problems. Similarly, to say that people at other income levels don’t understand the “plight” of your income level implies that a person at a certain income level has never experienced anything else, which is nonsense. I grew up near the poverty line - I know what it means to not have a lot of money and to have to really stretch to make ends meet. Luckily, I now earn more.

But if there’s one truth I’ve found from writing The Simple Dollar, it’s this: almost every good money-saving idea I have I can easily share with my parents. They’re in a completely different financial state than I am with a much lower income, but we constantly apply the same tactics. We clip coupons. We garden. We read because it’s fun and cheap. We drive late model used cars until they’re about to fall apart. And on and on and on.

What are the differences? My mortgage was almost ten times more than the one they took out in the late 1970s. I had more credit card debt than they ever had by a factor of at least five. I had $40K in student loan debt - neither of them ever had a dime of it. I may earn more, but my debt situation was far worse.

What’s the message here? It doesn’t matter how much you earn or how much debt you have, the basic principles of getting your financial life in shape are the same. Spend less than you earn. Resist temptations. Learn how to cut your spending. Create a debt reduction plan and execute it.

We’re all doing this, together. It’s not about rich or about poor - it’s about getting our financial lives back on track, and we all use the same tools to get there. That’s something everyone can strive for.