Reader Mailbag #51

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.

As usual, we’ll start things off with a few links to older articles that directly answer questions I’ve heard recently.
Review: Smart Couples Finish Rich
How and When to Cut Direct Financial Ties with Your Children
How Does the McDonalds Double Cheeseburger Stack Up to the Homemade Version?

And now for some great reader questions!

Are there any ways to optimize utalizing toll roads? How do you weigh between it taking more time to get to point B and it costing $0.75 on a toll road?
- Mol

How valuable is your time? Beyond that, how good is your gas mileage? Those are really the two considerations you need when considering this question.

For example, if you’re going to waste ten minutes just avoiding a single $0.75 toll, it’s probably not worth the time investment for most people. Not only are you losing ten minutes, but you’re also losing some fraction of a gallon of gas, possibly enough to equate to that lost seventy five cents.

Alternately, if you can plan an alternative route that only adds a minute or two to your trip and keeps you from dropping $3 on a long toll road, by all means you should strongly consider the alternate route.

I once added eleven minutes to a trip to avoid roughly $4 in tolls on a toll road. I felt, in the end, that it was a good tradeoff for me at the time, but others might feel differently.

What are some good places to eat in central Iowa? I’m going to be in the Ames and Des Moines area for a week or so and I’m looking for some good dining options.
-Willie

If you’re in Ames and like barbecue, Hickory Park is a must-visit. It’s practically an icon of central Iowa, a place that simply must be tried. The Cafe is a wonderful little place on the north side of town as well.

The Des Moines metro area has a ton of great dining options. Sage is always mentioned – if there’s a “top restaurant” in the area, it’s probably Sage. Try La Mie for breakfast and Court Avenue Brewing for great food and drinks.

Your best option, though, is to just ask your hosts in town for their suggestions. Enthusiastic dining companions can make the cheapest place into something wonderful.

what’s the best way to build credit? I graduated from college without loans or anything, thinking I was being smart, but now I’ve found I can’t get a condo or the other things I want because I have no credit history.
- ariel

The only way to build up credit history is to get some form of credit. My recommendation is to apply for a credit card and use it for purchases you would normally make anyway, like filling up your car with gas and buying groceries. Keep the bill constantly paid off. This will provide a great start to building a good credit rating.

You may find that it’s fairly hard to get a credit card right now with the economic uncertainty. If that’s the case, look into setting up a secured credit card with a small credit limit. A secured credit card is one in which you pay the credit limit of the card up front and that amount is refunded to you later (either at a prescribed date or when you cancel the card). This basically insures the issuer and minimizes their risk, making them much more likely to issue a card.

How are your New Year’s resolutions with regard to exercise and better health going?
- Amy

Pretty well, actually. I’ve lost about 15 pounds so far this year, actually faster than I would like, to tell the truth. All I’ve done is substitute in some healthier food options for less healthy options (drinking only water and skim milk, for one, and eating fruit for a snack) and start walking quite a bit (this past week, I walked a little over three miles each weekday).

I did not want to initiate any major changes in my life, but I will say that I do feel better, particularly over the last week or two. I definitely feel a lot more energy than I did a month ago, which is fantastic.

So, so far it’s been a success.

Are you familiar with–or perhaps even participating–Ramit’s (from I Will Teach You To Be Rich) Scrooge Strategy? He has a whole different approach to saving money that avoids most frugality tips. Instead he focuses on things like calling to get your cable/phone/insurance/etc. bills lowered and tackling those major spending habits. His argument is that small frugality tips (those that “only” save $5-$10 per month) take too much effort when trying to implement several at a time over a long time; an argument that I believe is completely valid. Anyways, I just wanted to get your opinion on Ramit’s view of frugality [or lack of]. Personally, I don’t believe there is any right or wrong way to save money, but do find Ramit’s method to be my preferred choice. Thanks.
- TMS

I think it’s good in concept and attractive for people looking for the big quick fix, but it’s shortsighted.

Let me give you an example. Let’s say I can swap out the incandescent bulbs in my house for CFLs and drop my electric bill about $8 a month. This activity would take me about twenty minutes, just once.

Under the philosophy you describe, such an activity would be a waste of time. Yet, over the course of three years, that activity saves $288 for only 20 minutes worth of effort (actually less than that, since with CFLs you don’t have to change bulbs nearly as often).

There are countless examples like this – little frugal steps that don’t save much money per month, but don’t take much time either. As a result, these efforts pay a huge hourly wage. Ignoring them because the immediate result isn’t splashy is a pretty big mistake, in my opinion.

You and your wife seem to have a very strong marriage. Can you give me some tips on how to keep my marriage strong? What do you do to keep it that way?
- Sally

Here are five things I make a conscious effort to do that seem to help our marriage stay strong.

I tell my wife I love her every single day. I usually do it in the morning before she leaves the bedroom, and on weekdays I’ll also tell her when I see her in the evening for the first time. I usually couple it with a kiss. It’s so simple, but it’s a constant reminder of the fact that I do love her, no matter what.

I ask about her day, listen, and ask follow up questions. I do this not only so I can keep tabs on her professional life, but also to give her a great chance to vent about her situation. Everyone needs to talk about themselves sometimes to someone who is interested – I try to provide that for her as often as I can.

I try to surprise her on a regular basis. I’ll spend an hour preparing a really excellent supper when she doesn’t expect it. I’ll spontaneously give the kids a bath when she’s comfortable on the couch under a blanket, even if it’s her turn. Doing these little unexpected things not only shows her I care, but also often compels her to do similar things for me.

I hold her hand. I do this all the time, whenever it crosses my mind and seems appropriate. I’ll just hold her hand gently while we’re talking or we’re riding in the car or we’re waiting for an appointment or we’re sitting on the couch in the evenings.

I talk about EVERYTHING with her and let her determine what’s interesting. If something is concerning me, I don’t hide it from her. I tell her about it. Most of the time she’s interested and we’ll discuss it – sometimes she’s not and I let it drop (this is key – if she’s not into the topic, I don’t push it). Either way, though, she gets the message that I’m making an effort to share and be open.

Why should I save for retirement at all if I don’t ever want to retire? I truly love what I do.
- Marc

You might love what you do, but will your employer love you when you’re in your seventies?

Retirement isn’t just something you plan for and choose on your own terms. Quite often, people are pushed into retirement simply because they’re starting to slip a bit in the marketplace. This doesn’t mean that they’re suddenly worthless – it’s simply a result of competitive organizations.

You might also find that your situation changes unexpectedly in your later years. Perhaps your spouse gets very ill and you need to devote your time to taking care of her. Perhaps your child dies suddenly and you choose to adopt your grandchildren, requiring you to devote a lot of time and attention to them. Perhaps you might want to continue your work independently. Perhaps you might discover a new passion in your later years.

What kind of digital camera do you use to take pictures for your photo-heavy posts?
- Alex

I currently use a Canon PowerShot SD880IS and I’m thoroughly happy with it. It takes 10 megapixel images, which are big enough for any manipulation I might want to do and also big enough to make solid-looking 8 x 10 prints. It also has a ton of options right on the camera, most of which I haven’t mastered yet, but I’ve been playing with quite a lot. It also fits in my pocket.

I have used PowerShot digital cameras for many years and have been quite happy with all of them that I’ve used. I mostly use them for family pictures, some outdoor shots, and also random pictures of things for The Simple Dollar and other web publishing.

I loaned my sister $500 several months ago. She pledged to pay me back quickly, but I haven’t heard a word about it in months. Should I confront her about it? What should I say?
- Cilia

Loaning money to family members is always dangerous because of situations just like this one. Cilia, you’re basically in a no win situation here.

If you don’t say anything but keep it bottled up, you’re likely to build up some resentment towards your sister over time, which will damage your relationship. Alternately, if you do say something (particularly if you do it repeatedly), you’re likely to cause your sister to resent you, since you’re behaving more like a lender to a borrower than a sister to a sister.

My suggestion? Mention it once if you must, but just let the debt go. Forget about it, except to remind yourself not to loan any more money to your sister. If you want to help her in the future, make it in the form of a gift.

Me and my boyfriend are obsessed with Babylon 5. Do you like B5?
- Mol

I tried to get into Babylon 5 at one point, but it never really clicked well with me. My wife absolutely despised the series, though – she has described it as the most boring science fiction series she’s ever seen.

Quite frankly, it’s very difficult for us to get into a “long narrative” style television series at this point with two young children. We’re only able to keep up with Lost thanks to DVR, and we’ve tried to follow a few other series but failed, simply because we’d get so many episodes behind that it would seem hopeless.

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

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  1. Trevor - 14 Year Old Blogger says:

    Great mailbag. I liked the Camera one because i’m sort of a camera person myself.

  2. dave says:

    Babylon 5!!! You should really give B5 another chance! The first season is most definitely a struggle early on, but by the end of the first season it has picked up steam and the rest is what I call “the greatest story ever told.” And because it was written entirely from start to finish before anything was filmed, everything fits together so snugly and every little thing is important, so the show is very fulfilling. It’s the most amazing show ever!

  3. Johanna says:

    @Cilia: When you do mention the loan to your sister, maybe suggest to her that you could work out a payment plan. She might be assuming that you want to be paid back in one lump sum, so she might be holding off on mentioning it until she’s able to pay you the whole $500. She might be embarrassed that she doesn’t have it yet, and she might be relieved to hear that you’re willing to take $50 a month for ten months (or something like that). Then again, she might not. But it’s worth a try.

    It seems to me that a lot of the problems that crop up in loans between friends or family could be avoided if only they discussed this stuff in advance, instead of merely pledging to pay the loans back “quickly” or “when they can.”

    Depending on how your relationship is with your sister, and whether she has a history of treating family members as ATMs or this was a one-time thing, you might also tell her that if you help her financially in the future (with either a gift or a loan), you want to first sit down with her and help her work out a budget. It could be that the missing $500 is just a symptom of a larger problem.

  4. K says:

    ariel – Trent is right about the only way to build a credit history is to get access to a line of credit and use it responsibly. Most utility bills and cell phone contracts will also count. I don’t know what kind of trouble you’re having, but I am 29 and have never had a credit card and still had no trouble getting an excellent rate on a mortgage. My credit score was over 790 even without ever having a credit card. I do remember a few years back I needed to pay a deposit on my cell phone because of lack of credit history. This may be the case for many things you experience, so I would advise you to build up a bigger emergency fund for these situations. If you want a credit card for rewards and will use it responsibly, go ahead and get one, but there is no reason to get one just to build a history.

  5. The Personal Finance Playbook says:

    I’ve never seen B5, but I wanted to chime in with the fact that I’m completely addicted to Lost. I’ve been watching it on DVD and am in the midst of season 3. That show really gets ahold of you.

  6. Shaun says:

    I must second what dave says about B5. Its a wonderful story, from start to finish, and everything fits together nicely. The characters are developed beautifully and it always made me wanted to watch more, even when I really had other things to get done.

  7. Maureen says:

    I agree with Dave. I’ve seen the Babylon 5 series in it’s entirety twice. The first time my dh and I would tape it on the VCR to watch together after the children were in bed. Years later we purchased the series on DVD to watch with our now teenage children. It’s a family favourite. Well worth the investment and I am sure we will watch it again in a couple of years.

    Firefly was another excellent but short-lived sci-fi series. I recommend them both!

  8. Anne KD says:

    My husband is a big B5 fan, and he tried hard to get me into it. He bought all the dvds and will occasionally watch them if I’m not home or working in a different part of the house. He memorized the dialogue (!) and I had to tell him that quoting B5 (or anything else) is a big turnoff. I can’t stand B5. I grew up reading and watching sci fi to the almost exclusion of any other genre, though that’s not the case now. B5 seems to be one of those things that you either love it or you hate it. We watch Heroes and Eureka, and we’re addicted to House. We just started watching House a few months ago.

    My husband and I do all the things you mentioned in your ‘how do you keep your marriage strong’ answer. The B5 issue took a while, he couldn’t or wouldn’t see that I am totally uninterested.

  9. Frugal Dad says:

    To Cilia, forgiving this debt would be a blessing to both you and your sister. Like Trent says, if you continue to consider her indebted to you then you will grow to resent her for not paying you back. Let it go.

  10. reulte says:

    I haven’t read much of Ramit other than a blog or two which I find thoughful and helpful. But I think the advice of ignoring small tips in favor of the big haul is slightly misguided. Sure, if you can find a way to wipe $50 of your monthly bill by calling your cable or insurance company, then that’s great and I encourage everyone to do it. Then what do you do next week? Yes, go for all the ‘big hauls’, but after you’ve called everyone and gotten every large discount/savings you can get … do the small stuff also. Trent point out that it may take 20 minutes to swipe the incandescents for CFLs. Perhaps it will take the same amount of time to speak to your cable representative and get the discount. So, that’s only 20 minuts out of 1440 for the day. To me, it’s not an either/or situation, you pay attention to the big savings you can get and you pay attention to the small things that add up.

  11. Sarah says:

    Willie-

    I’m from the DM area as well. I would also suggest The Latin King. It has great Italian food at great prices! My family has been going there for four generations now!

  12. Suzie says:

    To Cilia.

    I’d definitely mention it. She may have forgotten, or not realised that you need it back. But don’t make a big thing of it. Just say something like “Hey, whatever happened to that money I loaned you?” But I agree that you should mention it once and then let it go.

  13. Wendy says:

    I completely agree that you should never loan money to people you love. My husband and I have an agreement that we will never give money to family or friends that we need to have repaid. We only discuss repayment when it is a pride issue for the recipient.

  14. waldo says:

    Willie: And A’Dong by the Hoyt Sherman Place, great local Vietnamese. Seriously. Go. India Star on Douglas Ave, also excellent. I moved out a couple years ago, but I’ll post more as I remember them.

  15. SteveJ says:

    @Cilia – Johanna has a good point about the all at once. I had that issue with my brother, he owed me a ton of money and assumed I wanted it all at once, which would be basically impossible for him, unless he won the lottery or fell into a signing bonus.

    Even small payments were too much after a couple months and I gave up on tracking what he owed me after a year or so. I don’t miss the money at this point, I hated nagging about it so much that it’s not worth revisiting. It’s horrible to make a concerted effort to work in or avoid talking about money into every conversation you have with a sibling. I truly let it go, but my wife is still a bit resentful. It’s no good to say it’s ok and then bring it up or wield it as an excuse to avoid doing non-money favors later.

    So I’d explore payments first, and then depending on how that worked out, ask myself how much my current relationship with my sister was worth. And it’s likely that if this drags on, even if you get the money back, it may take a long time for the wounds to heal. If you can’t let that amount go, then you might as well keep asking for it. I think it’s better to have an overt reason for disgruntlement, rather than a secret resentment, and the relationship is pretty much damaged either way.

  16. Saver Queen says:

    reulte – agreed. Why is it an and/or proposition, why can’t we do both? Also, it’s easy to use, “I’m saving so much money on my cable bill” as an excuse to go out and buy more stuff! And that stuff can easily add up to even more than you saved. I enjoy finding creative ways to save money , and I think non-frugal types would be surprised to see how quickly it all adds up.

  17. Cathy says:

    I read getrichslowly.org, thesimpledollar.com and IWillTeachYouToBeRich.com semi regularly. GRS and TSD are both closer to my own philosophy and values, however, I do also appreciate Ramit’s entrepreneurial edge. Some people don’t like Ramit’s writing style, but I think people take it too literally. I don’t think he is being invective. I like ‘stupid frugality’ tips as he calls it, and I’m not offended when he refers to it as such. I think he does have valid points. For me, I employ both ‘stupid frugality’ and entrepreneurial income generating projects. The two are not mutually exclusive, and quite complimentary.

  18. Rain-X says:

    Question…

    Not sure if you have knowledge of this Trent, but may be some other here do… Negotiating Rent. I live in a big city, and my rent has been raised every year my lease is up. This years lease has been raised again in this “down” economy. So I went on craigslist and notice many apartments in the area included my current apartment are trying to lure people in by throw out 2 to 3 months of free rent. That’s roughly $3,000 of potential savings. I’ve tried once to negotiate with the complex manager in lowering the rent, but only got $20 knocked off the monthly rent. I can’t believe their willing to steal from peter (me) to pay paul (someone else) to move in! I tried to inform the manager it makes no sense to drive me away by not compensating me further to stay, then not to go pick up a nice deal somewhere else. The only thing holding me back is that moving is a pain in the arse and time consuming, which I am sure they know and are betting on. But I am fired up, and willing to vacate if they don’t meet me in the middle. If any one has any tips or suggestion that would be great. Thanks!

  19. My girlfriend loaned her brother $500 a while ago and is in the same situation. It sucks, but it is to be expected I suppose. We’ll see how it shakes out.

  20. reulte wrote: “Sure, if you can find a way to wipe $50 of your monthly bill by calling your cable or insurance company, then that’s great and I encourage everyone to do it. Then what do you do next week?”

    Ramit’s philosophy is that once you get done with the big savings, you look at ways to multiply your income.

    The Scrooge Strategy is NOT for free tips that you can find by reading any personal finance blog. That’s what most (including Trent) are missing. It’s full of specific, hard-hitting tips that can save you a ton of money. They are typically far more detailed than a blog post (often, they run 2500-4000 words with play-by-play instructions.)

    If you think Scrooge Strategy is just another collection of frugal blog posts, I encourage you to check out the site and read the front page to understand exactly what Ramit is doing.

    Disclaimer: I helped Ramit launch Scrooge Strategy and wrote a tip for it.

    -Erica

  21. Amber says:

    One of the best things I’ve learned in life is to give without expecting anything in return. If you feel you can’t do that-regardless of reason, simply don’t give. We’ve given thousands of dollars out of our very small income to a family member in need. We do not ever expect any money back, that person pays us back in many other ways.Being responsible with our money ensures that we can lead the life we want to which includes giving.

  22. Marlon says:

    Hey Trent, i was looking at some online accounts and was just wondering how come some banks and their online accounts are able to offer a higher interest rates than others do? Or is it that the banks offering a higher interest rate are doing so to lure new customers and is a such a “to good to be true” deal that you should stay away from. I’m just trying to understand how it all works. Thanks!

  23. rrpf says:

    Good answer regarding Ramit’s Scrooge Strategy. Ramit also justifies buying cars brand new over used. He has a great website but I have viewed him with a much more critical eye after that.

  24. Amateur says:

    I find that once you get in the habit of helping someone you love financially, they often get upset if you don’t wish to help any longer and they have this all-knowing feeling that you are able to help, but you won’t. That’s grounds for disconnection in feelings. I’m not against helping but I make it fairly obvious that my purpose isn’t to help someone buy stuff, now helping with school stuff is a different story.

  25. Mule Skinner says:

    Toll roads, other considerations: On the one hand, some toll roads are much safer than the alternatives. On the other hand, the non-toll way may be more interesting because of the small towns, side roads, and roadside stands.

  26. DivaJean says:

    reulte wrote: “Sure, if you can find a way to wipe $50 of your monthly bill by calling your cable or insurance company, then that’s great and I encourage everyone to do it. Then what do you do next week?”

    I would argue that the $50 would continue to be saved for EACH consecutive month- not just the one time.

  27. Elisabeth says:

    I would think that unless the toll road goes WAY out of the way, you might actually save gas money because unless you have a hybrid, you probably get more miles per gallon on the highway than stopping and starting on the street.

    Like Trent says, I’d find one of those “what is my time worth” calculator, and just compare the time savings. One other factor might be if you smoke – if you take the toll road, that might give you time for one less cigarette, which can add up over time.

  28. Heidi says:

    As an Iowa State graduate, I have to share:

    Stomping Grounds on Welch Ave. is THE.BEST.RESTAURANT/COFFEESHOP.IN.TOWN.

    Hands down. I miss it!

  29. FrugalCubicle says:

    Trent- How bout a new look to the simpledollar.com. It’s been this format for quite a while and maybe could use a change/facelift…….just a thought. I’m sure regular viewers will offer up suggestions. Peace!

  30. Andy says:

    Marriage advice:

    Build a loving community around you and your spouse. It takes more stress to break apart a community than to break apart a couple.

    This community could be church, family, or other communities of love, commitment, and care.

  31. Battra92 says:

    I read both Ramit’s blog and yours (as well as a few others) and personally I find you both right and both wrong (at least in how I am going to do things.) I’m not going to make my own detergent but I will bake my own bread and use CFLs. I’m not against negotiating car insurance or any other sort of rates (I lowered my car insurance rates today by switching AND put it on my credit card with the cash already in the bank so I can earn reward points)

    You gotta find the system that works for you. He has his system and you have yours and I have mine. So long as you have a system, it works for you and you control your money and not the other way around then things are good.

  32. I have read Ramit a couple of times, and I wouldn’t take much advice from him. He seems a little to wrapped up in consumerism from many of his blog posting. Especially his view on leasing cars and buying only brand spanking new. Makes no sense.

  33. Brian says:

    Can’t agree enough with comments praising B5. Long-narrative, more complex/layered than Star Trek, just a great show.

    Two additional shows of interest:

    The Tick (not animated)
    Andy Richter controls the universe

  34. Janine says:

    Trent-

    Do you think it would be a clever idea to hide cash in something like this? http://www.pfadvice.com/2007/01/26/skid-mark-safe-disgusting-but-if-it-works/ I have always assumed thieves can immediately spot the fake shaving cream can safes and hollowed out books that are sold to disguise valuables, right? Plus, those nasty underwear are pretty hilarious.

  35. Shari says:

    Could you please sacrifice one of your frozen burritos in the name of science? I’d like to know how long it takes to heat one up in the oven/toaster oven before I go out and buy supplies to make a huge batch of burritos of my own. I’m thinking 20 minutes at 375, but if you could road test your recipe for those of us without microwaves, that would be awesome!

  36. @ Cilia – I agree with Trent, mention it then drop it and treat it like you gave her a gift. Having lent out money to friends and family in the past, the best way is to simply treat it like a gift. Stressing over it doesn’t help anyone, not you or your sister. Also note who doesn’t pay you back, you should keep that in mind the next time they ask.

    -Nate

  37. rachel says:

    I would also recommend Jeff’s Pizza in Ames. It’s on Lincoln Way right by campus– DELICIOUS!!

  38. Jamie says:

    Hello Trent, I have a question I have been thinking about for over six months! How does a newly married couple deal with debt (even if it is the “good debt” of a student loan) that came from only one partner? A little background: My boyfriend and I are going to get engaged next week. We are both phd students at the University of Oxford, in the UK. He is British and I am American. Due to the way that British student loans/scholarships work, he will finish his degree without any debt — but I, unfortunately, will have about $60,000 principal on a US govt Stafford loan. We do not want to have separate finances once we are married, and also it is likely that he will earn a lot more money than I will for various reasons. So my question is: what do we do with that debt? It is the only debt that either of us have (no credit cards or anything like that), and even though it is “good debt” because it is a student loan, it still feels like an insurmountable number to me. Should I ask him to help me pay it off, or should I say that I will pay all of it off myself during our married life? My concern is that I would not be able to do anything like buy a car, put a down payment on a house, etc. while I am trying to pay off this loan, and that it would hold him back or force him to pay for those things, in effect paying for the student loan anyway. Also, I stayed in the UK and incurred this debt in part so that I could be with him (though there were a lot of other factors involved), rather than take a fully funded phd in America. Should that have any bearing on this? Please help, thank you so much.

  39. reulte says:

    Erica (#18) Thanks for the info. I will give Ramit another look-through, but I still say that neglecting small in favor only of big haul tips is short-sighted.

    Divajean (#23) Many small tips can add up to a surprising amount of money saved, but actually I was only considering time spent per action. That is, it only takes 1 phone call to lower your cable bill or your credit card apr for a long time (presumably big haul). However, many small tips often require constant monitoring (taking the reuseable grocery sack) and action; but many don’t (CFLs, automatic thermostat). Perhaps a good compromise might be how many times the tip must be used to achieve maximum amount of savings.

    Jamie (#31) If you plan to merge finances after you are married; then it isn’t your (singular) debt; it is y’all’s debt (plural) and it will probably be the worse decision you make. You already sound like you feel guilty just thinking of him paying it down or paying 100% of a new car for the both of you. Do you know where you are going to live (US or UK or elsewhere)? What are his thoughts on the matter? No, really, what are his thoughts after he’s paid about 2/3 to your 1/3 in 10 years or so (or whatever you think the ratio might be)? Does this entitle him to more decision-making priviledge over your earnings later in life or over where the family might go vacationing? Is this something he might bring up acrimoniously in some future argument? You need to have a good talk with yourself and with him about future expectations, employment and money. Good luck to you (in spite of my seeming pessimism)!

  40. john d says:

    @ariel If you can’t get a regular credit card, you might also try getting a store credit card like a Target Visa card for example. If you’re in the market for a large purchase like a television, furniture, car, then you can finance that. Some banks also have student credit cards that are available.

    If you put your mind to it, it is pretty easy to find people who want to lend you money. ;)

  41. dave says:

    @ Jamie – If you only incurred the student debt because you lived in the UK for him, I think it’s his responsibility to help you pay it off. The way I would treat it in my relationship is that it would be treated as a “family” decision such that it’s the family’s responsibility to pay it off. In fact, if it were my wife’s debt that she incurred just so we could stay together, I would feel entirely obligated to help pay it off.
    Just my two cents…

  42. Debbie M says:

    @Mark – Another reason to save for retirement is the financial benefits. If you can get a company match, that’s good. Otherwise, I recommend a Roth IRA if for no other reason than not having to deal with taxes on your investments. You can always pull your money back out of a Roth IRA whenever you want to (just not the extra money that has accumulated). The rest will be available when you are older—you may be able to use it to pay off your house or something else.

    And frankly, it’s very, very nice not to have to keep track of all your investments the way you have to when you are paying taxes on them every year. So, if you ever want to try day trading (which I don’t recommend, except for small amounts), I recommend doing it in a retirement account.

    Another thing to keep in mind is that a lot of people end up retiring earlier than they want to either due to health problems or economic problems. So you can think of retirement savings as another form of emergency savings.

    @Cilia – Another idea is to ask your sister if she is doing okay and offer to let her pay back the money much later if it will help her. Imply that of course she wants to have already paid the money back by now, so something must have come up. Mention a specific date or mention a specific condition, like as soon as she gets a raise or as soon as she catches up on her credit card. And I also like the idea of offering easy payments such as $50/month or $10/week. Usually there is some amount that can be afforded. If you decide to treat it as a gift in your own mind, you might share that with her—it might help her feel more comfortable around you, too.

    As for never lending to friends or family, I don’t really like that philosophy. Instead, I never lend anything I can’t afford to lose. I never lend money for something I oppose (and that includes loans that just put off the inevitable instead of fixing it). And I never lend money to anyone who still owes on another loan (and I do mention that when I make the loans). Currently, both my siblings owe me money. Although both have borrowed and paid me back before, they are both stuck right now. I do think they will both pay me back eventually, but it’s okay if they don’t. The big advantage to me is that even when they could use another loan, they never ask me.

    I’ve even decided to add a savings category for these kinds of loans and also for something I think of as chance-of-a-lifetime-opportunity gifts. Like when my family went to Disney World, but my sister couldn’t afford to go, that was terrible. So I decided I never want to let that happen again. When my sister moved to Belgium for a while, and everyone but my brother could afford to visit her, I subsidized him so that he could go, too.

  43. Sammy says:

    I’m glad I found this site!

    My thoughts on how to keep up with long-running series. I have a Blockbuster DVD-by-mail account and have watched some of the most amazing series by renting three discs at-a-time. We would never be able to follow shows like Lost or 24 if we had to watch them live, but we find these shows are compelling when you can watch a full season in 3-4 weeks. We really don’t have a need for Cable TV anymore thanks to this regime. An episode per night and two per night on weekends (after the kid is asleep) turns out to be a great routine.

    As a result, I find I am almost completely uninterested in movies. I have found very few 1-3 hour storylines that are as captivating as a season-long arc that plays out over 18 hours or more.

  44. Green Panda says:

    I have personally seen the benefit of using your tips and Ramit’s. I did the Save 1k challenge at his site and have followed some of your great tips. I found that I love making my own detergent.

    Thanks to both sites’ advice, we’ve paid off our car loan and the only debt left is my student loans. I enjoy reading both blogs and seeing what tips could benefit us personally.

  45. Greg says:

    Trent, I was just looking through your archive and it looks like it’s been a while since you posted on your 101 in 1001. I was just wondering how that’s going? You inspired a friend of mine and I start our own late last summer and we both have really enjoyed doing it.

    Thanks, Greg

  46. princess_peas says:

    @Mol
    Another great point is to take note of the time/distance of your journey. So, if for whatever reason you are driving on the motorway at night, or in the middle of the day, then chances are the regular road is not going to be very busy and hence using the toll road is not worth it. But, if you need to be on the motorway around 8am or 6pm, then you are likely to get stuck in traffic, so the extra money may be well worth it. By the same token, if you are using the motorway just to cross/go round a big city, where there will be congestion etc, then the toll road will be worth it, whereas if you are just using it to travel a good distance, then the regular one may (or may not) suffice. And points raised about fuel efficiency and what is your time worth are great too, although I didn’t think of them until I just read it.

    @Trent
    Question for next week:
    You’ve said a few times that you don’t like to eat out but just make your own meals at home because it’s cheaper etc. At what point do you break these rules? Ie, when will you say ‘enough is enough. We are going out for dinner/getting a take-away tonight’, even as a one off? (I mean spur of the moment.) Or doesn’t that sort of thing happen at all? I am interested in knowing what it takes for you to not keep other rules that you set for yourself etc as well, but I thought that that example was the clearest one. The reason I ask is because I try to keep good habits some of the time but I haven’t conquered it all yet, not by a long shot. So, I am interested to see if other people think that specific circumstances are worth bending/breaking the rules for, so that if these splurges do happen, perhaps I can have a bit more structure about WHEN they do. :-) TIA.

  47. ariel says:

    @ Trent: Thanks so much for addressing my question! I applied at Visa, Mastercard, etc. and I was turned down by each because of a lack of credit history. I had never heard of secured cards before this post, so that was really helpful. When I called my credit union to apply for one, they said that due to my responsible debit card use and my medium size emergency fund, they would be willing to give me a regular credit card. I didn’t realize that my bank could give me better options than just going to the credit card companies! So, now I’m on my way to a credit history.

    @ K: As to what kind of troubles I’m having, here is one example: my cell provider disallowed me from a substantial employer discount and has me on a “quick pay” program where they deduct my bill from my debit card automatically each month. They said I don’t “qualify” for regular bills and employer discounts because I don’t have a credit history. I rent one room from a homeowner so I can save money, so rent and utils aren’t in my name and I’m not building credit that way. I’ve requested reports from all three bureaus and I have absolutely no credit history. My guess is that rent and utils were how your good credit score was built.

    @ John: I applied for a Kohl’s card and was rejected due to a lack of credit history… I think even department stores are getting more careful with extending credit.

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