As I announced on Twitter a few days ago, I recently turned in the manuscript for my upcoming second book.

I’m extremely proud of this book, as I conceived of the entire idea myself, spent literally hundreds of hours researching materials and interviewing dozens of people, and spent the last three months tying together the manuscript.

Since I’m so excited to talk about it (and I know a lot of you are interested in what’s coming based on the emails and Twitter comments and instant messages I’ve received), I thought I’d offer up a little “question and answer” session about the book to whet your appetites.

What is the book called?
The book is tentatively titled “Making Change.” We hope to settle on the final title of the book within the next week or two. In fact, earlier today I submitted a revised title, subtitle, and very basic cover mock-up to my publisher, based on a brilliant suggestion from Sarah (my wife) a few days ago.

What is “Making Change” about?
The world is changing at a rapid pace. Twenty years ago, the web was nonexistent – today, virtually all of us use it as a key information gathering tool. Fifteen years ago, cell phones were a novelty at best – now, they keep us connected with each other in ways inconceivable a generation ago. Ten years ago, Asian economies were in ruins – today, products made in China and jobs outsourced to Bangalore are the norm. Five years ago, Facebook and Twitter didn’t exist – today, hundreds of millions of people use these services to maintain social connections.

My own story is a perfect example of this rapid change. Four years ago, I was buried in consumer debt, working in a straightforward career in a monolithic organization, missing out on the work I was most passionate about. Today, we’re free of consumer debt and working in a freelancing career doing exactly what I love the most.

These rapid changes make our lives more unpredictable than ever. They’re changing some of the most fundamental ways the world works – things move faster with far less predictability. Many of the old rules – the old ways of doing things – simply no longer work.

“Making Change” is about navigating these changes – and all of the countless other ones coming our way in the near future. What can we do to protect our hard-earned money – and earn even more? How can we maximize our career opportunities? And whatever happened to the promises of economic and personal freedom that the future was supposed to hold? My own story of making change plays a central role in the story, as does many of the stories shared to me by readers of The Simple Dollar over the years.

Intrigued? I hope so.

When is “Making Change” coming out?
We’re hoping for an April 2010 release date, though nothing is set in stone. The enormous amount of research I did for this book (and an unexpected illness in September) caused me to slip a little in submitting the final manuscript, so this may cause the final release date to slip a little more.

What made you decide to write a book like this?
I originally started out writing a memoir – it was very humorous and self-deprecating in places. As I kept writing, I kept noticing a theme in what I was writing – everything was going along, then something fairly unexpected happened, leaving me gobsmacked.

Why were all of these radical changes always happening in my life?

The most fascinating part was that many of the things that happened to me were things that happened to many others over the last ten years or so. We fell into terrible debt. We had a child when we didn’t expect it at all. We found our career path twist in an wholly unexpected (and undesired) direction. We found large organizations being increasingly disloyal to us as individuals. We found communication tools that put us in touch with countless other people who shared the same seemingly obscure interests that we have. We lost the power of isolation, carrying cell phones that follow us wherever and whenever we are.

At first, I thought this might be a source of a few interesting posts on The Simple Dollar, but the more I began to study these disruptive changes – and how they’re becoming more frequent, not less – I realized that many of the rules of personal finance and career management didn’t really apply any more. They assumed a long period of stability – and those long periods of stability don’t exist any more.

I followed that rabbit hole and out came “Making Change.”

What happened to the memoir book?
Right now, it’s sitting in hibernation. While I did include some pieces of it in “Making Change,” the memoir has such a different tone to it that it’s really hard to compare the two.

In theory, if I ever got desperate for articles for The Simple Dollar, it would work well for that. The “memoir book” as it sits right now is a collection of about twenty essays, chronologically ordered, and about 3,000 words apiece. Each one relates – in a somewhat humorous and self-deprecating way – some personal finance principle that I discovered the hard way.

I’m honestly unsure what I’m going to do with it, but I know one thing – I need a “book break” for a while. It’s going to rest for a while. In a few months, I’ll dig it out, read it again, and decide what I want to do with it. I might ship it around to other publishers, self-publish it (using Lulu.com or something like that), or simply turn it into a long series of posts. I just don’t quite know.

What’s the most surprising thing about the book?
There are two things that I think will really stand out. One, I think I make a very good case for the large amount of unpredictability in our lives – far more than most people think there is. This area drew a lot of my research for the book, actually.

One of my biggest conclusions for solving that challenge is pretty surprising, too. Yes, I talk about all of the usual techniques – emergency funds and so on – but perhaps the best way to protect yourself against such uncertainty comes from a word that our grandparents would find more familiar than we do (but we have surprising ways to access it ourselves). That one word? Community.

When can I read some of it?
In a few months, I intend to start posting excerpts here on The Simple Dollar so you can make up your own mind about the book and discuss a few of the bits in detail with other readers.

People who have signed up in the past to be “Friends of The Simple Dollar” will get a few extra treats as the book release day approaches.

When can I preorder it?
It’s not listed on Amazon.com yet. As soon as it’s listed, I’ll let you know.

I do ask that if you discover a way to preorder it before I announce it here on The Simple Dollar, that you wait until I announce it. The reason is simple – a large “spike” of preorders all at once helps me out greatly in the promotion of the book and makes it that much more likely that it will be a widely-read success.

Megan writes in:

I’m by far the most financially sensible person in my family. I spend far less than I earn, yet I’m happy with the things I do have. I have my retirement savings in very good shape (even after the mess last year!) and I have a big emergency fund and almost enough savings for a 20% down payment on a nice house – and I’m only 26!

Recently, I spent a weekend with my older brother and his two children. They both receive an allowance, but their mother indulges them constantly and allows them to spend it without even thinking about it. I would like to do something to help these kids get a good financial education when they’re young so they don’t make the mistakes that most people make in their twenties that haunt them forever (I made some of my own, too).

What do you think I should do? What’s appropriate to do?

I find myself in a similar position whenever I’m around my own nieces and nephews. There are many thing I wish I had the opportunity to teach them, but my window of opportunity for doing so is extremely limited.

In my own life, I’ve found the most success when I stick to these principles:

Connect with the children as deeply as possible. The absolute best way for a non-parent to connect with a child is to get down at their level, listen to what they say, and talk to them as if they were an adult. Do that frequently and children will quickly begin to like you and see you as something of a mentor. Doing this makes it much easier for you to introduce ideas to them – they’ll be open and receptive to what you have to say.

Offer nonthreatening advice to the parents. One really effective way to do this is to give them a book or something practical that helps the parents with the financial teaching process. For example, you could give the parents a copy of the book Raising Financially Fit Kids by Joline Godfrey. Offer it not as a criticism of what they’re already doing. One great way to do this is to say simply that you had money problems when you were younger and you’d love to be able to help those children you love not have the same difficulties you had. Most parents will appreciate such parenting advice given in this fashion.

Give gifts that reinforce money lessons. A powerful way of doing this would be to give a child a Money Savvy Bank as a gift, with a small amount already in each slot of the bank. Then, encourage them to split their allowance – or any other money they get – among the pieces of the jar. The bank comes with a great parents’ guide as well, one that might encourage the parents to get involved and reinforce the lessons of the bank.

Lead by example. If you have a strong connection with the children, they’ll want to emulate what you do. You can thus ingrain good financial choices in them by simply behaving in a financially responsible fashion yourself. Take them shopping with you and show them how you do it – make a list, don’t buy stuff that’s not on the list, etc. Tell them your own goals for the future and say you put aside money every week for that goal. Then, show them that you’ve achieved that goal when you do (like when you buy a car or some other tangible item). Don’t fill your house with lots of stuff – reject consumerism, but do it without bragging about it or dropping names. Walk the walk – children notice.

Be positive about good financial choices. When you notice the child making a good financial choice, compliment it. Positive reinforcement works far better than negative reinforcement – negative reinforcement is mostly used because it’s easier.

Good financial habits don’t appear out of thin air. They require good role models and examples that show the benefits of living in a financially stable way, as well as basic ideas on how to do it yourself. You can drop these breadcrumbs in the lap of any child if you do the groundwork of connecting with that child first.

It happens to the best of us. We resolve to make some change in our life and, for the first month or two, it goes great. We see real progress in the area we want to change.

And then it happens. We give into temptation and make a mistake – sometimes a big one. We devour half of a Sara Lee pound cake after two weeks of careful dieting on raw foods. We blow $150 on clothes after a month and a half of careful spending control.

And we feel horrible about it later. We feel some guilt. We feel some shame. We begin to doubt that we can ever do this. And we eventually revert back to our original behaviors.

I found myself doing this recently while writing my second book. During much of the summer, I was taking long walks five days a week (by long, I mean 4-5 miles) and I felt incredibly good. But as the deadline for my book approached, I found myself skipping these sessions simply because I was so focused on writing. Then, when I’d realize that it was too late to go on a walk that day, I would be upset and frustrated with myself. Eventually, though, I began to simply discard my old routine, replacing it with long evenings of writing.

It’s happened to me many other times as well. I’ve backslid on spending promises, on musical practice pledges, and so on.

Why do we all do this? This is obviously a common human thing – one only needs to read a newspaper a month or so after New Year’s to read about tons of backsliding. What causes us to stumble back against our best intentions?

To put it simply, it’s all about the planning. When we stumble, it’s a clear indication that our plan for success had a fatal flaw in it.

What kind of flaw? In my own experience, I’ve found four different types, each with four different ways to correct it.

Poor time management. In the case of my exercise routine, my own time management was to blame. Instead of planning ahead to make plenty of time to finish my manuscript, I indulged in a lot of fun activities in the late summer that ate up several days. The result of this is that in September and October, I was pressed not only to keep my normal work activities going, but to also finish and polish up a full book manuscript. This caused me to have to make some tough choices and discard a lot of “important but not urgent” things – like my long walks.

The solution? If your commitment requires you to put aside a significant amount of time regularly, work harder at your other tasks on a consistent basis so that you have a “buffer” to help you in the event of a crisis. Get ahead on your projects at work. Take care of household tasks as they come along instead of allowing them to build up into a wall of work.

Temptations. Eating five slices of pizza after dietiing all week is giving into temptation. Buying a $300 pair of shoes after being careful with your money all month is giving into temptation.

We’re all tempted by things. Quite often, our resolutions are a recognition that such temptations are bad for us in the long run, but we desire these things all the same.

The solution? I’ve found two that work. First, an allowance of splurging often helps keep our better behavior in check. Allow yourself $25 a week to splurge with. Put that $25 in cash in a jar on top of the fridge. Then, when you’re truly tempted, take down that jar and freely spend it with no guilt. This trick often “releases” the pent-up desires that we build up without destroying all of our positive work. A similar trick is to allow yourself one saucer-sized plate of whatever food you desire twice a week or so.

Second, supportive friends that are involved with and aware of your goals will often help make it easier. Perhaps they’ll diet or exercise with you, or at the very least won’t tempt you to go shopping and spend money.

False commitment. We commit to some sort of change, but on some level, we’re not really committed to it – and we know it. We pledge to give up eating fatty foods, but we don’t really want to do it at all. Often, we’re just trying to commit to something because we know other people value it, not because we value it.

The solution? Such a commitment will never work over the long haul. You need to spend some time rethinking why you are committing to this goal. Often, such goals are conceived and attempted out of a desire to fix an interpersonal relationship of some kind, often one that’s suffering due to reasons completely unrelated to the goal. Focus on fixing the relationship, not on “fixing” some element of yourself that you’re not committed to fixing. Try communicating in a healthy and mature way – and if that’s impossible, it may be time to step back from that relationship.

Self-destructiveness. You have a self-destructive element that undermines whatever you attempt to do to improve yourself. This can often be borne out of low self-esteem.

The solution? If you find yourself doing this, it’s likely that you need counseling of some sort. Discuss the situation with your medical doctor and ask for a referral to a trained mental health professional that can adequately help you overcome such urges.

Let’s not pull any punches about it: big, life changing goals are hard. They become even harder if you aren’t surrounded by people who support you and want you to succeed and if your desire and commitment toward the goal is not complete.

It’s important to remember that a stumble is not a failure. It’s a wake-up call to regroup, replan, and succeed.

Each Monday, The Simple Dollar opens up the reader mailbags and answers ten to twenty simple questions offered up by the readers on personal finance topics and many other things. Got a question? Ask it in the comments. You might also enjoy the archive of earlier reader mailbags.

How about combining your frugality and kitchen skills by giving us some recipes and tips on cooking Beans and Rice and Rice and Beans?
- Marcia

A long time ago, I wrote an ode to the bean, which may be my favorite item to use in cooking. It’s inexpensive and it’s a protein-rich backbone to countless different kinds of meals, from tacos and chili to curries and soups.

What I usually tell people to do is very simple. Just take whatever staple ingredient leftovers you have – vegetables, meats, and so on. Add some rice or some beans to it. Season appropriately. There, you have a killer meal.

You almost can’t mess it up.

For giggles, I’ll reprint five of my favorite bean-oriented recipes here.

Beans and Eggs
Easy as pie. Just crack four eggs, add half a teaspoon of milk and some pepper, and beat them rapidly until they’re consistent in texture. Pour the egg mixture into a skillet and add half a cup of cooked black beans (or a bean mix, if you prefer). Scramble the eggs by repeatedly moving the eggs around in the skillet as it cooks until it’s nice and fluffy and full of beans. Put some cheese and salsa on top and you have one of my favorite breakfasts in the world – plus it’s an ovo-vegetarian dish.

Balsamic Vinaigrette Bean Salad
Take two pounds of cooked beans, any variety you’d like, and add in a diced medium red onion. To this, add two tablespoons of balsamic vinegar, four finely chopped garlic cloves, a quarter of a cup of extra virgin olive oil, and mix everything together. Add some ground black pepper to taste. This makes a very big batch of the salad, which is a great thing to take to a potluck dinner – for home use, you should probably halve the entire recipe (one pound of beans, a small diced onion, one tablespoon of vinegar, two garlic cloves, and an eighth of a cup of olive oil).

Beef and Bean Burritos
Cook a pound of ground beef. As the meat is cooking, add half a cup of chopped onion and a minced garlic clove. Stir the meat often to break it up, then when it’s well cooked, drain it, and add to it two teaspoons of chili powder, one teaspoon of oregano, half a teaspoon of cumin, half a teaspoon of salt, and half a teaspoon of brown pepper. Mix it all together and you have the beef part of the recipe. Just fill a large tortilla with this meat, some lettuce, and whatever beans you like – I prefer black beans or pinto beans or even refried beans.

Sixteen Bean Soup
Just follow the cooking directions above with your favorite multi-bean mix, except add half a pound of leftover meat to the soup as it’s cooking. I like to add cubed ham myself, but you can add other meats. Also, add a small minced onion to the soup, too, just as it begins to boil, and also add salt and pepper to taste.

Bean, Ham, and Tomato Casserole
Basically, take the soup you made with the sixteen bean soup recipe and drain off all but a cup of the liquid. Mix into the soup two diced tomatoes, put a bit more pepper on top, and (optionally) put a thin layer of finely ground Cheddar cheese on top (the cheese is highly optional). Bake it at 350 F (160 C) for about ten minutes and it turns out surprisingly well and often very distinct in flavor from the sixteen bean soup.

I recently got a flyer for ING’s Orange Mortgage. They offer incredibly low interest rates. But the structure looks surprisingly like a ARM. What am I missing here?
- Pankaj

It is an adjustable rate mortgage – you’re not missing anything.

An ARM worth its salt starts off with an unbelievably good rate – often 2% below what a comparable fixed rate would be. That gets your attention, of course.

The catch is that in so many years, the rate adjusts upwards, and it often has a ceiling higher than a comparable fixed rate mortgage.

Many people got ARMs because they were seduced by that low rate and they believed their future situation would easily be able to handle the adjustment. Quite often, they were wrong.

Avoid adjustable rate loans. Never believe your future self will be able to handle it.

I find it ironic that a guy who writes a blog that (probably) reaches millions thinks having kids is the best way to advance their cause.
- Kevin

If no one had children, we would all be candles in the wind. In one hundred years, there would be no human race. We would pass nothing on to the future, any of us.

Thus, anyone that chooses not to take on the burden of raising a child is themselves a candle in the wind. They’re relying on others to continue the flame by making the candles. Any flame that they can pass on is passed on to a candle made by someone else, a candle that’s already formed and given flame by the parents of that child (most of the time, of course). Sure, they might make the flame stronger, but they didn’t start the fire. (Yes, I’m using Billy Joel and Elton John metaphors to illustrate the point).

My feeling towards anyone who calls a parent a “breeder” is that they’re completely comfortable with the complete extinguishment of the human race. And that, frankly, makes me personally uncomfortable. If they were not comfortable with this, they would not denigrate those who take on the often thankless work of raising that next generation of people.

For all the good I’ve done in this blog, it does not compare to the impact I have by raising a child to adulthood. I have the unique position to mold that candle so that the flame burns bright, an opportunity I simply don’t have in other avenues in life. No matter how great of a writer I am, it simply pales in comparison to the continued impact and influence I have on the mental, emotional, spiritual, and psychological growth of the two little children in my home. I gave them their genes and now, perhaps more importantly, I’m responsible for the nurture side of the coin.

If I do it right, I can turn out a child that has the potential to cure cancer or breed a better crop that can feed starving children or create art that can truly uplift the human race or, perhaps best of all, find authentic joy in the world and find ways to share it with others. If I do it wrong, I turn out a sociopath.

I’m not saying that others do not have influence. But no matter how enormous that influence, it doesn’t compare to the thousands of hours parents spend with their children, passing on language, beliefs, customs, personality traits, perspectives on the world, personal skills, and countless other little things.

Everyone thinks of Mr. Holland lighting a child’s flame, but forgotten in that shuffle are the parents that drove kids to countless band contests, urged them to practice at night, provided feedback on their play, bought new reeds and dropped them in the instrument case without being asked, showed up for all of the recitals, bought sheet music and audio CDs to help fuel the passion, and all without a dime of compensation. Mr. Holland showed up for work and waved a baton – yes, it was important and it caused a child to change their direction a bit, but that flame rarely takes off without quite a lot of prep work from a good parent.

And, remember, Mr. Holland was a parent, too. One can do both.

What benefit is a child going to get out of having a tutor?
- Johanna

It depends on the child. Some children thrive on individual one-on-one teaching, where they’re much less afraid to ask the “stupid” questions that are plaguing them. I know several kids like this – they didn’t understand the topic in the classroom because they were afraid, for various reasons, to ask, so it was up to a tutor (in this case, me) to help them out.

For other children, it may be that they just have little interest in learning and a tutor is a waste of time and resources.

Often, for a parent, it’s hard to tell which one is the case, especially if they have little confidence in their ability to teach classroom-type lessons. So they’ll hire a tutor or a tutoring service and let them figure it out.

For me, I’d prefer to give my own child my best crack at tutoring so I could at least understand where he or she is coming from.

Would you share with us your recipe for that wonderful sounding au gratin?
- Mike

Take four russet potatoes and slice them into 1/4 inch slices. Slice one onion into rings. Then, preheat the oven to 400 degrees Fahrenheit and lightly butter a one and a half to two quart casserole dish.

Put half of the potato slices into the casserole, then the sliced onions, then the rest of the potatoes. Put some salt and pepper on top.

After that, melt three tablespoons of butter over medium heat. Add three tablespoons of all purpose flour and stir until it’s a very thick paste, about one minute. Then, stir in two cups of milk. Cook it for about two minutes until it just begins to thicken, stirring regularly. Then, add one and a half cups of grated cheese to the hot milk mixture quickly, stirring it in until you have about four cups of a thick, delicious liquid cheese mixture.

Pour that cheese mixture over the potatoes, breathe in the wonderful aroma deeply, then cover it with aluminum foil and pop it in the oven for one and a half hours. Yum!

What do you think about bankruptcy? While I realize there are sometimes extraordinary circumstances, it seems like many people who declare bankruptcy could handle their debt like you did: by scaling back their lifestyles, living within their means, and committing to debt reduction. Would you ever recommend that someone declare bankruptcy instead of trying to repay their debt?
- Sara

While I understand society’s need for some sort of resolution to a person who is in far too much debt, I feel like society’s penalty for this is actually too lenient today.

Do I advocate a return to debtor’s prisons? No. However, if you’ve mismanaged your finances to the point that you need a court to straighten everything out – and in the process, you escape some of your debt – there needs to be a steeper penalty than just a court-enforced payment plan and a bad credit history.

I’m not sure what that balance is, but I do feel that bankruptcy, even with the recent tougher changes, is still too easy.

You’ve said you’ve used iTunes for years to listen to music. What’s your most listened-to song? Album?
- Kate

My most listened to song since somewhere in mid 2004 is Hallelujah by Jeff Buckley – a cover of the classic Leonard Cohen song for all of you older folks like my friend Heidi, who was slackjawed recently when I identified Hallelujah as a Jeff Buckley song.

I had a harder time actually figuring out which album was the most listened to, but from the best I can determine, that album is Bachelor #2 by Aimee Mann.

If I were guessing without looking, I would have guessed the album right, but I would have guessed the #3 song for most listened – Rangers by A Fine Frenzy.

When you and Ramit had a big “debate” a while back about frugality, was that whole thing a set up or do you guys actually have a personal issue?
- Fred Mac

My father spends $5 every week on lottery tickets. I tell him all the time that it’s a waste of money, but he shrugs it off. What do you think? How should I get him to stop this stupid behavior?
- Carlos

Do you feel that other bloggers are rivals of yours? Do you compete with them?
- Amanda

Not at all. My only rival in blogging – seriously – is myself. My own laziness and willingness to go off the tracks following my own whims and muses is my biggest obstacle.

Almost every blogger out there is not a rival, but a peer. Those people know better than anyone else how difficult – and how rewarding – it can be to blog for a living. They share ideas and thoughts. They link to each other. They support each other. They help each other.

If we were rivals, we would stab each other in the back, not encourage our readers to read those other sites.

The only exception to this are bloggers who never seem to link out or ever mention others. However, I don’t view them as rivals – they’re just loners.

To put it simply, I simply don’t have rivals. I have peers and friends.

Except for J.D., of course. He’s going down.

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

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

Knowing how to be a leader – and using that skill from time to time – opens doors for you no matter what you’re doing in life. It helps your career. It helps your social standing. It creates a positive reputation for you, one that often precedes you. It can even help your family life and personal friendships. In short, leadership can be truly rewarding.

The problem with leadership, though, is that the vast majority of people don’t know how to actually be a leader. For a small number of us, leadership comes easy – a natural extension of who we are. For the rest, though, it’s not obvious at all. We’re held back by our own seeming desire for simplicity (though, sometimes, it’s simpler to lead) and our own lack of self-confidence or sense that we’re not leaders at all.

A long time ago, I was forced into a leadership position on a project that I felt completely unprepared for. A very kind friend in a high place mailed me a copy of this book – Warren Bennis’s On Becoming a Leader – and encouraged me to give it a read. The ideas in this book helped me to step up and actually make the most of the situation as it was handed to me and, since then, I’ve recommended it to several others (as I did in a recent Reader Mailbag, actually).

What makes this book so compelling? Let’s dig in and take a look.

Mastering the Context
Every situation in which one is called to be a leader has some sort of context. The people involved are part of the context, as are the specifics of the situation. Quite often, leaders become too tied to the context of the situation and, as a result, come up with pretty poor leadership decisions. Bennis offers several good and bad examples of how leadership can be destroyed by context. For me, the most potent example was the presidency of George W. Bush – in the context of his political ideology and of the disaster of 9/11, he made choices that were perhaps not the best leadership choices for the United States (I don’t think anyone would argue, whether they be liberal or conservative, that mistakes were made during the Bush years). A positive example of stepping outside of context is Norman Lear – the creator of the seminal sitcom All in the Family. He took the context – sitcoms of the 1960s – and looked not at a situation full of rules, but instead a situation where many of the rules could be broken. That’s what a leader does – he finds ways to break away some of the context, opening up new areas for success. (Incidentally, I think this is why great leaders also have a big dash of creativity.)

Understanding the Basics
Here, Bennis identifies a pretty large handful of traits one will find in a leader: a guiding vision, passion, self-knowledge, candor, maturity, trust, curiosity, and daring. Bennis argues that most of these traits are not ones people are simply born with – they’re usually self-made by a person who pushes themselves and wants to excel at leading others. He goes on to distinguish that there’s a big difference between merely being a manager and being a leader – in fact, he argues that, quite often, an MBA makes a person a good manager but a pretty poor leader. A manager manages and maintains the status quo – a leader leads people somewhere great.

Knowing Yourself
In order to lead, you must know yourself intimately. You have to know what you’re truly capable of and what you must ask others to help you with. Without such intimate self-knowledge, you can never effectively lead because you’re incapable of understanding how to select people to fill the roles you most need filled. Bennis points towards four key lessons one must learn in terms of knowing oneself:

You are your own best teacher. Pay attention to the things that work for you and don’t work for you. Don’t listen to what everyone else says – try things for yourself and see if they fly.

Accept responsibility. Blame no one. If something goes wrong under your watch, it’s your fault, period. Don’t blame others for it – step up and take responsibility. Yes, you can make moves to make sure that this doesn’t happen again, but the failure is your responsibility if you’re the leader.

You can learn anything you want to learn. Knowledge can be acquired by anyone if they’re persistent. Don’t use ignorance as a crutch. Instead, accept that you are ignorant about some things and step up to educate yourself.

True understanding comes from reflecting on your experience. Look back at what you’ve accomplished and try to figure out how you accomplished it. Similarly, look back on your failures and determine what you did wrong to cause that bad result.

Knowing the World
Almost all of the worthwhile learning that people do comes outside the classroom. It comes from losing yourself in an experience, reading books because you want to read them, trying new things because you want to try them, and reflecting on all of this stuff, adding it to your tool belt. People who choose not to do this are actively choosing not to be leaders – they’re happy being managers.

Read a book. Travel. Meet new people. Build a friendship. Find a mentor. Mess something up. You learn from these things, not from rote memorization in a classroom.

Operating on Instinct
Every decision we make in life is based on incomplete information. At some point, we have to decide that it’s good enough and go ahead with whatever decision we have at hand. Our ability to still make good decisions even with incomplete information relies on instinct – a sense of what the right decision is that comes from inside. Often, that voice inside of us is built out of a lot of learning about the world, a lot of experience of both success and failure. Learning trains our instincts so that we can make better decisions with less information.

A leader, in the end, is a person others rely on to make the difficult decisions and set the direction for everyone. A well-honed instinct is key to being that kind of leader, and a good leader relies on and trusts that voice inside of himself.

Deploying Yourself: Strike Hard, Try Everything
Every single one of us fails in life. The difference between leaders and others is whether or not they pick themselves up and try again. Do you face your fears? Do you again try the things you failed at in the past, or do you avoid them like the plague? If you try something and it goes badly, do you avoid it in the future or do you relish the challenge of improving in that area?

To put it simply, a leader does not back down from a challenge. They don’t allow fear to control what they do. Instead, if something is scary or deeply challenging, it’s something they focus even harder on achieving.

One particular quote at the end of this chapter really struck me.

The means of expression are the steps to leadership:

1. Reflection leading to resolution.
2. Resolution leading to perspective.
3. Perspective leading to point of view.
4. Point of view leading to tests and measures.
5. Tests and measures leading to desire.
6. Desire leading to mastery.
7. Mastery leading to strategic thinking.
8. Strategic thinking leading to full self-expression.
9. The synthesis of full self-expression = leadership.

In other words, it all begins with reflecting on your successes and failures and building from there.

Moving Through Chaos
It’s often thought that leaders don’t have the same crises that we do. We think they don’t have to deal with office politics, layoffs, demotions, fighting for promotions, and so on. We think they view the world as a set of chess pieces to play with as they wish, that “strategic vision” means playing games with people.

In truth, most leaders had to overcome a great deal of career adversity to get where they’re at today. The only difference is that, at every opportunity, they took the opportunity to try to grow as a person and improve their instincts instead of complaining and commiserating about their hard luck. A trial by fire can either burn you or forge you – leaders are forged.

Getting People on Your Side
The key to getting people on your side is to be trustworthy and to constantly show that their trust is well-founded. Bennis identifies four key elements of such trust.

1. Constancy. You stay the course for the people that rely on you. When problems come, you handle them, but through it all, you maintain a steady direction and don’t descend into chaotic behavior.

2. Congruity. If you say something, you mean it, and it shows in your actions. If you expect something of your followers, you expect it of yourself first and you follow through with it.

3. Reliability. When it really counts, you’re there for the people who need you.

4. Integrity. When you make a promise or a commitment to someone else, you follow through with it.

Organization Can Help – or Hinder
There are times in which the group you’re intending to lead simply will not be led. If the people involved don’t care or they have a completely different direction in mind than the one you’re providing or the bureaucracy in the system is so intense that no amount of bushwhacking will clear it, no leadership can help the situation.

Instead, a leader should attempt to learn from this situation. What can be done to end the situation as painlessly as possible? What can be done to avoid such situations in the future? Every failure is a lesson.

Is On Becoming a Leader Worth Reading?
On Becoming a Leader pretty much delivers what the title promises. It’s the best discussion I’ve ever read on things a person can tangibly do to improve their leadership skills. If you’re interested in improving them, this one’s pretty much a must-read.

The question comes down to whether or not you personally find it valuable to work on your leadership skills. My perspective is that most lives have avenues that can be improved through leadership – it helps you build better relationships with others in the workplace, in the community, and in one’s family if they’re able to step up and be a leader when the situation calls for it.

The Simple Dollar has reviewed hundreds of personal finance, personal growth, and career books. Please check out the full list of Simple Dollar book reviews, alphabetized for your convenience.

November is here. Winter is sneaking up on us, and with winter comes winter heating bills for most of the United States. I live in northern Iowa, where temperatures can get quite cold in the heart of the winter months and, since I work from home, I have to utilize lots of different tricks to ensure that we’re not burning too much energy just to keep the house warm.

Last winter, I catalogued several of the best tactics to share with you at the dawn of the next winter. Here they are.

Check your insulation.
Take a quick peek in your attic. What do you see? Do you see any bare spots not covered in insulation? Attempt to identify what type of insulation you have and make sure it’s up to the level of insulation you need for your area using this helpful insulation guide along with this tool for understanding insulation R-values. Proper insulation is key to keeping your house warm.

Make sure your home is air sealed.
Air leaks and drafts allow warm air to quickly escape your house, resulting in tremendous heating and cooling bills. The solution to this problem is to check your home for air leaks and properly air seal any leaks you discover. This useful guide from the Department of Energy will walk you through the entire process.

Close the vents in unused rooms (and seal them off, if possible).
If your home is well insulated and you have a room or two that’s not actively being used, turn off the air vent in that room and seal the room as best you can. The temperature in that room will drop significantly when you do this as you’ll no longer be heating it – and no longer paying the bill for heating it, either.

Invest in thick socks.
I work from home in Iowa, and I’ve learned that there’s no better way to stay warm in the winter at home than to wear thick socks. Thick socks keep my feet warm even if I keep the temperature in the house low, and feet are one of the primary thermal indicators for the body as well as being a relatively poorly circulated extremity. Keep the feet warm and the rest of you will be fine.

Test the lower levels of your thermostat.
Along with wearing warm socks, I often tend to turn the heating down during the day (raising it when my family is at home, which is basically just a manual version of the effect one would get from installing a programmable thermostat). I work on the upper level of my home where it’s warmest, so reducing the house temperature during the day rarely has any negative impact on my work – but it certainly saves on energy costs.

Use a hot water bottle. We also tend to dip our thermostat down a bit at night when we’re snuggled in our beds. Unfortunately, after a long winter day, a bed might not necessarily be cosy right at first. Thus, I often use a trick that my father used when he was a boy – a hot water bottle. We use a reusable microwaveable hot water bottle filled with a gel-like substance. A quick heating in the microwave just before bed means that the bed quickly gets cosy warm – a perfect resistance against the cold nights.

Open the blinds on the sunny side of the house – close them on the other side.
In the winter, I do this on the top two floors of our home (where most of the windows are). In the morning, I open all of the blinds and curtains on the east-facing side of the house and make sure everything is closed on the west side (usually done the night before). Then, when I eat lunch, I switch the two. Then, just before dinner, I close everything on the west side of the house. This goes a long way towards maximizing the benefits of direct sunlight and minimizing the heat lost to windows not facing the sun.

Stick together – share a blanket.
If you walked into our family room, you’d see that we already have several blankets out for the winter months. We love to cuddle up as a family under a blanket or two on the couch, sharing our natural body warmth with each other. It keeps us all close together and toasty warm.

Use the oven.
Who wants to go out to eat in the deepest part of winter anyway? Stay home and cook something in the oven. Not only will the food preparation save you money, you’ll also find that the oven is far more energy efficient in the winter. How so? It works with the warming of your house rather than against the summer cooling of your house.

Drink warm fluids.
For me, winter is filled with cup after cup of hot tea and hot chocolate. Drinking a warm fluid makes me feel much warmer (and likely does slightly raise my body temperature). For me, the effect lasts for about forty minutes, a time in which I can get away with a temperature a few degrees lower. During the day, I’ll often prepare myself a giant mug of hot tea and slowly sip it over the course of a few hours. The small energy expense of heating up the water is more than replaced by the energy savings of being able to lower the house temperature a bit more.

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

One Year Ago (October 25 – 31, 2008)
Should an Entrepreneurial High Schooler Go to College? This discussion resulted in a lot of interesting back and forth on the question of whether or not a high schooler who starts a strong business in his spare time should immediately go to college or should focus on building that business that’s already successful.

Brand Preferences and the Two Year Old Child I wrote this as I began to notice the effect that brand recognition was having on my two year old son. Was he being unduly influenced by branding and packaging? What could I do about it?

Eight Things You Should Do Immediately to Save Money When You Buy a Car If you buy a car, there are several things worth doing immediately to maximize fuel efficiency and minimize maintenance costs. These all work no matter what kind of car you buy.

Exploring the Connection Between Time and Money I’m a big believer that time is money, at least in the sense that money is just a representation of invested time. Thus, time is an enormous consideration when choosing which option is actually the cheapest.

Two Years of The Simple Dollar: My 25 Favorite Articles of the Past Year Here’s my celebration of the second full year of The Simple Dollar. I just collected my top twenty five articles from the second year of The Simple Dollar in one place.

Two Years Ago (October 25 – 31, 2007)
Seven Tips For Avoiding Boredom During A Financial Turnaround Isn’t living cheap boring? Not at all. It’s all about just choosing the less expensive things that you enjoy doing. Take a look at the many, many inexpensive things available for you to do. The wider your horizons, the more fun you’ll have.

A Deeper Look At Dave Ramsey’s Seven Baby Steps To Financial Freedom – And How They Apply To Us Dave Ramsey’s debt recovery advice is popular because it’s so straightforward and simple. However, they’re not always a perfect match for everyone. Here, I dig deeper into his “baby steps” and see how they match my own life.

The Eternal Question: Am I Doing The Right Thing? With the complexity of life around us, it’s easy to not be entirely sure if your choice is the right thing. Is it better to spend more now or save this money? Is it better to invest in a 401(k) or a Roth IRA? How can you ever know if you’re doing the right thing?

The Ten Most Important Things I’ve Learned About Money and Life In The Last Year Here, I summarize the ten most important things I learned about money during the first year of The Simple Dollar. This article really does contain the cream of the crop of what I learned during that crucial period of my life.

One Year of The Simple Dollar: My 25 Favorite Articles As with the article above, this is merely a collection of what I consider to be the twenty five best articles I wrote during the first year of The Simple Dollar.

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

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

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

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

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

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

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

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

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

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

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

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

“Shane” writes in:

I’m twenty three years old. I just got a really great job with a 401k that’s matched 100% by my employer up to 10%, which I’ve heard from others is a really great deal that I need to take advantage of. So I started investing 10% of my paycheck so I can get the matching funds.

The only problem I have with this is that I have no idea about retirement. It’s more than forty years away. I just put my money into the investment the person told me to put it into so I have no idea if it’s a good one for my retirement. I don’t even know where to start.

I get emails like this quite often from young professionals who are completely clueless about retirement – and for good reason. When you’re forty years away from retirement age, the thought of retirement seems incredibly distant. It feels more than a lifetime away – that’s because it is more than a lifetime away.

The one piece of knowledge that many young professionals do have, though, is a solid sense of self. They have a good basic understanding of who they are, even if they haven’t pieced through the details yet. And, quite often, this basic understanding is more than enough to make some sound retirement decisions.

Here are three questions I’d encourage any twentysomething to ask themselves.

If money were no object, what would you do with your time?
Some people would choose to be idle with their time, enjoying all of the freedom that comes with it. They’d party. They’d go on trips. They’d goof off. They’d play on their Xbox all day long.

Other people would want to work for something or build something. They’d spend their time with a volunteer project – or maybe even start their own. They need to have a big productive project in their lives in order to feel fulfilled and happy.

Most retirement advice is written for people in the first group. They’re the ones who, when they reach retirement age, will want to travel and spend their later years enjoying themselves with leisure as much as possible.

The other group gets personal enjoyment out of working and being productive. With the many opportunities already available for people to work as late as they’d like in life, such people will probably work at something – whether it’s gainful employment or a big volunteer project or some mix of the two – until they drop dead with a tool in their hand.

If you’re in the first group, you need to be saving as much for retirement as possible. While it’s fine to put money into riskier investments when you’re young, you should start moving into more conservative investments – like bonds or treasuries or cash – pretty early on, even as much as twenty years before retiring.

If you’re in the second group, saving for “retirement” basically means saving for the last year or two of life when you’re unable to work and also saving for some supplemental income for the last few decades of your life. You likely don’t need to kick the savings into high gear and can afford risk a little later than the other group, sliding the money into conservative investments five or ten years before you begin to withdraw it.

Are you frugal?
Do you carefully watch your pennies? Do you spend time seeking out the best deal on an item? Are you find with eating beans and rice a few evenings a week because it’s a dirt-cheap meal that’s still pretty healthy? Do you buy – or at least try – generic versions of products?

If such choices come naturally to you, to put it simply, financial life as an adult is going to be easier for you. After all, if you’re careful with your pennies, the dollars will follow. Because of this, you’re likely to have built up significant assets before you reach retirement age – in which case, pushing your retirement savings to the hilt might stand in the way of your other goals in life.

If such choices seem completely alien to you, you’ll have a more challenging road ahead of you. Almost always, you’re better off financially if you minimize the number of financial mistakes you’ll make along the way. In that case, you’re probably better off pushing your savings up a bit.

Are you interested in having children?
When you picture yourself twenty years in the future, does that vision involve children? For some people, it does – I know it certainly always did for me. For others, it does not – some of my closest friends are wonderful around my kids, but they can’t imagine having children of their own.

Parenting is not for everyone. It can be infinitely rewarding to the right person, but infinitely frustrating to others. On top of that, it’s incredibly costly – little people are unquestionably expensive. They rely on you for everything – their food, their clothes, their space, their education. If you don’t relish in this thought, parenting might not be right for you – and that’s fine.

If you do envision children in your future, kick start that retirement. The more you save now means that later on you’ll be substantially ahead of the savings curve and you can pull back on your contributions in order to devote more resources to raising your children. Even if you end up not having children, you can still pull back later on in order to enjoy travel and other adult endeavors. Also important is the fact that a well-funded retirement means that you’ll never wind up being a financial burden to your kids.

On the other hand, if you are doing everything you can to avoid the remote possibility of children, it makes sense to save for retirement at a slower rate now, allowing you extra money to enjoy the more adult-oriented things you want out of life.

Just worry about the saving for now – don’t sweat the details.
Many people get overly wrought about making sure that their money is in the “perfect” investment. To put it simply, your investment choice is secondary – by a long shot – to simply saving your money as soon as possible and as much as possible.

Start saving now. If you don’t know what to invest in, just ask for suggestions from the representative there. Since it’s a tax-deferred retirement account, you can make investment changes later on without any tax issues.

One good default choice is a “Target Retirement” plan, which basically means that the fund manager will put you in aggressive investments when you’re young, then gradually make the investments more conservative as you grow older. This is a great choice if you’re unsure.

Later on, when you’ve gained some experience in the world and perhaps learned more about investing, you can take a more direct hand in your choices.

For now, though, the best decision you can make is to simply start saving.

Good luck.