Wednesday, May 31, 2017

How to Surprise Someone for Their Birthday (or Other Special Event) Without Spending a Ton of Money

Maybe you’re in the midst of a financial turnaround. Maybe you’re having a hard time finding a job. Maybe you’ve just been waylaid by a torrent of unexpected expenses.

Whatever the reason, you’re in a situation where money is super tight. You’re dealing with it, though. You’ve got this.

There’s only one catch. Someone close to you is about to celebrate a special event of some kind and it would be very reasonably expected that you contribute to that celebration with a gift of some kind or some other special thing.

Maybe it’s someone’s birthday. Maybe someone is getting married or having a child.

Whatever it is, a celebration is in order, but because of life’s constraints or your other personal commitments, it is very hard for you to come up with the resources to offer up the things you’d like to be able to contribute. You just don’t have the cash to buy a really nice gift or pay for some sort of special treat.

What do you do?

I know that feeling quite well. You feel like a cheapskate or like the financial struggles in your life are just pulling you down – or both. You feel really guilty that you can’t support this person you care about in their special moment in the way you really think that you should. It can feel awful.

Here’s the thing: You’re not without options here. You don’t have to go through this occasion without contributing to that person’s celebration in a meaningful way. You just have to step back and look at other options beyond the expensive flashy gift or the pricey treat.

Here are six options to consider that will result in something very meaningful and quite valuable for the recipient without messing up your precarious financial position.

Strategy #1: Take care of some of their hated chores.

Chores are a part of adult life. There’s always laundry to do, dishes to clean, things to fix, meals to cook, floors to sweep, carpets to vacuum, cars to clean, things to pick up and put away, beds to make, mail to sort… it’s endless.

Different people are wired differently, though. If each of us ranked those chores in order of how much we loathed them, our lists would look quite different. I personally loathe picking up items and putting them back in their place, while I don’t mind dishes or laundry. (That’s probably why we have a cupboard full of clean dishes while my office desk looks like an explosion of paper and books.)

If you want to make a celebration special for someone, take a block of extra time and do all of the chores that are facing them at the top of their “do not like” list. If they hate laundry, do a bunch of their laundry. If they hate vacuuming, vacuum all of their carpets. If they hate cleaning toilets, clean their toilets. Do whatever it is that they least like to do in their lives. If that’s done, move up the list. Try as hard as you can to clear their plate of chores completely, but when in doubt choose to take on tasks they really don’t like.

What this gives them is free time in exchange of tasks that they dislike, and that’s a tremendous gift. Free time can be spent on fun things or on tasks that keep getting put off or, frankly, whatever they want. There are few things better than starting a weekend with no real chores on your plate!

Strategy #2: Plan a day around their favorite activities.

What is it that the celebrated person enjoys doing that doesn’t involve spending money? Plan a day around that thing and spend it with them.

If the celebrating person likes hiking, plan a day of hiking in a state park somewhere. Pack their bag with appropriate supplies and a wonderful sack lunch for them and either go along for the hiking or pick them up and drop them off wherever they want you to do so. If that person loves to read, clear out several hours for uninterrupted reading, make a comfortable spot for them, leave them alone and free of distractions, and bring them a meal that’s simple to eat and won’t be messy on the books they’re reading. If that person likes to play video games, do the same – make that space as comfortable for them as you can, bring that person food and snacks, and stay out of the way. Let them have their day in complete peace with their passion.

It’s extremely important that you do everything in your power to genuinely appreciate whatever the activity is if you’re going to engage in that activity, too. If you plan a game day for your husband or wife and you’re personally not really into games, don’t force yourself into that event. If you do, have fun doing it and let that other person direct all of the choices. Don’t act miserable or distracted or else you take away from the value of this celebration. If you’re not engaging in it, let them be on their own to enjoy it without distraction.

Strategy #3: Prep a bunch of their favorite meals.

To this very day, one of the greatest gifts I’ve ever received was from my grandmother, who spent a day making several dozen breakfast burritos exactly how I liked them and packaging them individually for freezing. She mostly used items she had on hand to make them – the few ingredients she bought were pretty inexpensive, like eggs.

This is an amazing gift if you happen to live with someone, because it’s essentially home-cooked food, which is inexpensive in itself. The “cost” here is in the form of the effort. Making several dozen breakfast burritos – to use my grandmother’s example – is a substantial amount of effort, although the ingredients are pretty cheap. It’s the effort that is the gift here, not the ingredients; in terms of raw dollars and cents, this type of gift will likely save your household money in the long run.

Pick out a food that the person you’re celebrating really likes. Perhaps it’s breakfast burritos that they like, or maybe it’s bean burritos or steak burritos. Maybe they like tuna casserole or pierogis or … well, whatever it is that they like as either an individual meal or as a family meal. Whatever that meal is, make a whole bunch of it and package it up for them for easy preparation. Make it so that they can grab a package out of the freezer and have it ready to go in as few steps as humanly possible, and make a lot of them.

Strategy #4: Volunteer to do a lot of the ‘grunt work’ for the celebration.

Let’s say you have a friend or a sibling who is getting married and you know you’d love to give them a huge, memorable gift… but you don’t have the means to do so. One option you can take advantage of is to simply be one of the people involved in pulling off the wedding.

Offer to be their wedding planner as their wedding gift. Offer to be their caterer or their photographer or their florist. Do whatever it is that you think you can unquestionably handle on your own, and give that gift well in advance of the ceremony.

Our wedding was actually centered around gifts like this. A family friend made our cake. An aunt was the caterer. A sister-in-law was the florist. A family friend was the photographer. A family friend was lined up to be the DJ too (although circumstances later prevented that). Some of the features of the wedding weren’t done to bridal magazine perfection, but the cost of our wedding was absolutely minimal and there was something special and close about the whole affair.

Strategy #5: Make something, ideally using a skill you already possess.

What skills do you possess? Are you a skilled artist? A skilled chef? A skilled photographer? Can you crochet or knit? Those skills are a great source for a wonderful gift.

Make someone a crocheted blanket in their favorite colors or a scarf with the name of their loved one in Morse code stripes throughout. Draw a wonderful picture for them and frame it very simply for a decoration. Take some simple ingredients and make a mind-blowing meal for that couple you care about.

All of those things make for stunning, memorable, and extremely low-cost gifts.

Strategy #6: Take on some of that person’s burdens for a while.

If you know someone that has to deal with an intense burden of some kind, like constant care for an ailing child or spouse or parent, take on that person’s burden for a while and let them actually exit the picture and enjoy some unburdened time. That is just about the greatest gift you could give to a person with an intense responsibility on their shoulders.

Offer to spend the day being a caregiver in their place so they can spend it doing literally whatever they want. If it’s possible, consider even doing it for multiple days so they can take a short trip and get completely away from things for a while.

Even the most wonderful caregiver in the world can eventually find themselves stressed under the burden of a constant responsibility. Taking on that burden, even for a short while, can do wonders to refresh a person and restore their psychological strength. It is truly a great gift.

Here’s the real truth: The most valuable gift you can give someone is time. Giving your time to them in the form of making something special or in terms of taking away some of their tasks and burdens is an incredible gift. It gives them the time to enjoy things in their life that they might not otherwise have time to enjoy, or it gives them something special that only they have. Such gifts are deeply meaningful while only scarcely scratching one’s wallet.

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Beware the Shady Financial Advisor

In late 2016, I achieved a writing milestone I was particularly proud of: I secured my own column in my state’s biggest newspaper, the Indianapolis Star. Every few weeks, they’d let me crank out a column about ways to save money or some other aspect of frugality, all in the name of helping community members achieve their financial dreams. Since I’ve always wanted to write for a print publication, I was stroked.

A few months had passed and everything was fine – that is, as long I didn’t read all the angry troll complaints in the online comments. Eventually though, I started getting some weird emails from local people who thought they could “help me” with my column. Ahem.

One guy who reached out stands out as the most peculiar, and scary, really. He was a financial advisor, he said, and he wanted help me “ramp up my message and touch more lives.”

His words, not mine.

As a writer who has a collective reach in the millions through the various publications I write for, I thought that was laugh-out-loud funny. So, I was like yeah, no. I don’t want to work with you. And that was before I really knew what he wanted.

But, it gets worse. After our initial email exchange, he followed up on LinkedIn to share more details about his genius plan. Since I was intrigued by now, I asked him to spell things out. Here’s what he said:

“My company has a very unique message about getting out of debt, backed up by a specific plan for doing so. You know more than most, that debt is epidemic, and that far too many people feel hopeless and helpless when it comes to seeing light at the end of the tunnel.

“You have an audience – and I suspect the demographic of your audience coincides with families who have the greatest struggle with debt. What I’m envisioning is that – if you vetted and validated what we do and what outcome it produces for people – that you might want to be a sort of spokesperson for the solution. That may be a complete non-starter, but if it is not, it would give you something to talk about by way of solving family debt issues that is effective, timely, and doesn’t necessarily require sacrifice (lifestyle modification) to accomplish.

“Bottom line – it could position you to do more than talk about it through your writing – but actually advocate a solution (please don’t mis-read that your writing isn’t effective on its own). We would of course show you how your advocacy could benefit you financially, which might give you another, complimentary income source. If I’m way off base – just say so. If you’d like to know more – let’s get together. Your call – I just don’t want to leave things on a sour note due to my poor word-choice and failure to research you before reaching out.”

Whoa. To be clear, he wanted me to help advance his agenda in exchange for monetary compensation. Worse, he wanted me to suggest an alternative that “didn’t require sacrifice.” I wondered what on Earth he was talking about. Sorry, but on this planet, you typically need to make a few sacrifices to get out of debt. Right?

Sadly, what I discovered on his business website did not surprise me at all. While he was a “financial advisor,” he focused most of his business on whole life insurance and variable annuities. His company’s actual mission, which is on the homepage of their website, is to change and improve “how Indexed Universal Life Insurance and Indexed Annuities are sold.”


Beware of the Shady Financial Advisor

With few exceptions, most people need whole life insurance and annuities like they need a hole in the head. Especially if you’re in debt, you’ll get a lot more bang for your buck by cutting your expenses and using your extra funds to pay off high-interest debts, including credit cards and personal loans.

While I’m surprised this “financial advisor” thought I might collaborate with him, the fact remains that this type of thing happens all the time. And since nearly anyone who works in financial services can call themselves a “financial advisor,” it’s only natural that you’ll run into a sketchy one at some point.

Heck, my own husband could have been a shady financial advisor if he hadn’t changed course. Faced with a career crisis about five years ago, he turned his focus from funeral directing to investment and life insurance sales. After enduring the training, however, he found out the firm he joined wanted him to focus his efforts on selling whole life insurance because the commissions were huge – like, thousands-of-dollars-per-sale huge.

They also said he could call himself a “financial associate,” which seemed gross for someone hawking whole life insurance to family and friends. After all, he hadn’t really received any financial training, other than passing his boards and exams.

Within a few weeks of starting the job, he quit and burst home in tears. He just couldn’t do it. It wasn’t honest and it wasn’t right, he said. So, back to the funeral industry he went (albeit this time with a different employer).

But, for every person like my husband, there are a few who forge forward with whatever dishonest career path they’ve chosen. And sometimes, they even convince themselves they’re doing the right thing. The financial advisor who contacted me is the perfect example. Somewhere along the way, he learned to believe people in debt really need whole life insurance and indexed annuities to turn their lives around.

The Bottom Line

While there are thousands of reputable financial advisors out there, never forget that some “advisors” are wolves in sheep’s clothing. While they may seem honest, some financial professionals may be nothing more than life insurance salesman in disguise. Some may be hell-bent on selling you specific financial products – whether you need them or not – instead of helping you achieve your financial goals. Unfortunately, it’s mostly up to you to figure out who’s who and whether they’ll hurt or help.

Holly Johnson is an award-winning personal finance writer and the author of Zero Down Your Debt. Johnson shares her obsession with frugality, budgeting, and travel at

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Have you ever encountered a shady financial advisor? If so, how did you find out? Please share in the comments below.

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Tuesday, May 30, 2017

These Are Your Rights Under the Fair Credit Reporting Act

You may already know that you have the right to claim a free copy of your credit report once every 12 months. You might also know that you can dispute any errors appearing on your credit reports with the three credit reporting agencies (CRAs): Equifax, TransUnion, and Experian.

Both of these rights are conferred to you under a federal law known as the Fair Credit Reporting Act (FCRA). Here are the various rights and protections that law grants to American consumers:

The Right to Free Credit Reports

As mentioned above, the FCRA gives you the right to a free credit report (aka file disclosure) from each of the three credit bureaus once every 12 months. To claim these free reports, simply visit – you don’t need a credit card. You may also be entitled to additional free reports under any of the following circumstances:

  • You are an identity theft victim who has placed a fraud alert on your credit file.
  • You receive public assistance.
  • You’re unemployed but plan to apply for employment within the next two months.
  • Someone has taken adverse action against you (a credit denial, for example) as a result of information on your credit.

The Right to Dispute

You have the right under the FCRA to dispute information on your credit reports which you believe to be inaccurate. When a CRA receives your dispute they have 30 days (sometimes 45 days) to investigate your claim. At the end of the investigation the disputed information must be either (a) verified as accurate, (b) corrected, or (c) deleted.

Regardless of the outcome, the CRA must inform you of the results of your dispute. This entire process is free of charge if you handle the dispute process on your own.

Limits to How Long Negative Information Can Remain on Your Credit Reports

The FCRA places time limits that control how long negative information can remain on a consumer’s credit report. Though a few negative items are allowed to remain on your credit reports indefinitely (e.g., unpaid tax liens and unpaid Federal student loans), most derogatory credit entries must be purged from your credit after a period of 7 to 10 years.

The Right to Limit Access to Your Credit Reports

The FCRA also dictates who has “permissible purpose” to access your credit reports. Your reports cannot be legally accessed by the person you met on an internet dating site, for example, or your nosy next-door neighbor. However, permissible purpose to access credit reports can be granted in all the following circumstances.

  • You can access your own credit reports as often as you like. If you have exhausted all your freebies, then you might be charged a fee (or you could search for a free online credit report provider as well).
  • Your credit report can be accessed as part of a “credit related transaction.” In other words, if you apply for a loan, credit card, or new insurance policy, then a lender or insurance provider has the right to request your credit report.
  • Your credit report can be accessed if a court order has been issued.
  • Your credit report can be accessed for employment screening purposes. However, your written consent is required.
  • If you have an account with a creditor, the FCRA also allows the account provider to access your credit reports as part of the account management process.

The Right to ‘Opt Out’ of Prescreened Offers

Have you ever checked your mail and discovered a pile of “you’re preapproved” credit card offers? If so, then there’s a good chance that at least a portion of your credit information was accessed by the company that sent you the offer.

If you no longer want companies to have access to your credit information for prospecting purposes, then you have the right under the FCRA to “opt out.” You simply need to visit if you wish to exercise this right. This is also free of charge.

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John Ulzheimer is an expert on credit reporting, credit scoring, and identity theft. He has written four books on the topic and has been interviewed and quoted thousands of times over the past 10 years. With time spent at Equifax and FICO, Ulzheimer is the only credit expert who actually comes from the credit industry. He has been an expert witness in over 230 credit related lawsuits and has been qualified to testify in both federal and state courts on the topic of consumer credit.

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10 Strategies for Standing Out During the Hiring Process

At any given time, there are millions of Americans out there seeking employment with some level of seriousness. Many of them are in your field, and some of them are likely applying for the same job.

Most of those people follow the same exact pattern over and over again for their job search. They make a half-decent resume and cover letter, send the exact same document to many different organizations, and then wonder why they rarely get calls back. Then they repeat. And repeat. And repeat.

On the other end of that picture is a hiring manager at an organization, someone whose job it is to figure out who to interview and who to hire for a specific position. That person gets dozens if not hundreds of these kinds of applications and resumes every week. They’re all pretty similar – some are more polished than others, but nothing exceptionally stands out from the pile.

Somehow, a few of those resumes get selected for interviews. People show up. They answer questions. They go home. The hiring manager has to pick from among those few or else hire a few more.

So, how does that hiring manager make that choice? Who goes to the top of that pile of resumes? Who gets the interview? Who gets the job from that interview?

It’s the applicants that stand out in a positive way at each step in the chain.

I’ve been through this process on both ends of the equation. I’ve applied for very competitive jobs and actually secured a couple of them. At the same time, I’ve served on hiring committees for very competitive jobs and watched the sausage get made. There are quite a few tricks that really stood out to me on both sides of the coin that really made the difference. Here are the ten best among those strategies.

Strategy #1: Strongly prioritize applying to organizations where you have a connection.

One of the easiest ways to get your application to the top of the stack is to have someone within that organization with a good reputation that can vouch for you. Trust me – if a person with a good track record sticks their head into a hiring manager’s office and puts in a good word for you, your application is going to zoom right to the top of that stack. It’s not a guarantee of an interview, but it’s a huge positive attribute.

Thus, one great strategy for getting a great job is to simply start by focusing strongly on organizations where you already know someone.

Of course, this starts by having a pile of strong professional relationships, which is something you should start building and maintaining immediately. You do this by being active professionally with your peers on social media, attending professional meetings, and engaging people in your profession inside and outside of your workplace as often as you meaningfully can. Having said that, a dozen good strong positive relationships are worth a thousand very flimsy ones, so prioritize building good relationships over collecting tenuous ones.

If you do know someone at an organization with an opening, talk to that person and ask them to take some time to put in a good word for you. If your relationship with that person is positive and you’ve helped that person in the past, it’s very likely that they’ll help you out, and a quick email or quick conversation with the hiring manager will help push that application of yours right to the top.

Strategy #2: Craft your materials to specifically target the job and company.

The vast majority of resumes and cover letters that a company receives are pretty generic. They’re obviously created and designed to be able to be sent out almost thoughtlessly by the applicant, as though making one good ready-made resume and cover letter is all that’s needed.

The thing is, each position is different. Each company is different. When your cover letter and resume reflect what’s unique about that position and company, it looks a lot better than an ordinary resume.

Before you send a resume and cover letter to an organization, stop and take some time to do your homework on the position itself and the company you’re applying to. Ask yourself what exactly that organization is really looking for in terms of the skills and characteristics you have to offer and then customize your cover letter and resume to focus on those things.

This strategy takes a lot of work, but it really pays off. You have to spend some time really researching the company and the position itself to really get a bead on what that company is all about and what they’re really looking for, but a cover letter and resume crafted to maximize that is going to hit a home run.

Strategy #3: Focus your cover letter on a challenge the company is facing and how you can solve it.

To expand upon the previous strategy, one powerful step you can take is to turn your cover letter into a pitch to solve a specific problem the company is facing. Again, this takes a great deal of work and some careful thinking, but it can really pay off.

Rather than just looking at the skills you have and merely listing them out, instead look at what the company actually needs here. What are they hiring you to do? What need does the company really have to even offer this position?

Write your cover letter from that perspective. The company has a problem of some kind or else they wouldn’t have this position open. What is that challenge they’re facing? What do you have to offer that will answer that challenge?

Remember, the organization doesn’t really care that much about you personally. What the organization cares about is solving this problem that they have, and they want to put the best person possible into that position so that the problem can be solved. They want to move forward on their mission, whether it’s providing some kind of service or solving some kind of large problem or simply making as much money as possible.

Ask not what the organization can do for you, but what you can do for the organization.

Strategy #4: Build an online portfolio of your best work

Your resume is going to usually include mentions of the work that you’ve done, but by the nature of a resume, it can’t really include that material. You can’t include art or lesson plans or code or interfaces or certifications in a resume.

What you can do, however, is create a website for yourself that houses all of those things. It can show off code you’ve written or designs you’ve created. It can list your certifications and the self-education you’ve completed (with links to your Coursera profile, for example).

Your online portfolio can basically be an expansion of your resume, including examples of your work that just do not really fit into the dimensions of a typical resume.

Make such a portfolio. I recommend using a service like Squarespace, which makes it pretty easy to set up this kind of online portfolio for yourself. Fill it with examples of your work and your efforts to become a better professional.

Include a link to this material in your cover letter and resume so that hiring managers can take a look at that material when deciding whether to interview you or not. Often, the presence of a solid online portfolio can be a difference maker.

Strategy #5: Call the hiring manager before the interview.

Shortly after the application deadline, take the time to call the organization and see if you can talk to the hiring manager. Many job applications provide some method for contacting the organization, so don’t hesitate to take advantage of it.

When you get the hiring manager on the phone, simply ask about the status of choosing interviewees for that position. Make it clear that you’re very interested in the position and that you think you’re a great fit. This is a great time to look at your notes about the company and the position and hit a few of the high points in the conversation that explains why you, specifically, are a great fit for solving that organization’s specific problem.

Don’t overdo it. The hiring manager is busy, so keep the conversation short. Just make it clear in a very brief way – less than a minute – that you’re very interested in the position, that you think you’re a great fit for it, and that you’re wanting to know what the next step is.

Often, if you do this in the day or two following the close of an application period, you’re going to hit that hiring manager very close to the time in which he or she is sifting through those applications. A quick phone call like this sticks your name in their mind and can often cause them to pull your application to the top of the stack. Again, don’t overdo it – keep the call really brief and really positive. You just want to do enough to get your name in the hiring manager’s mind in a positive way, not an annoyed way.

Now, let’s move onto great strategies for when you do get that interview!

Strategy #6: Prepare for the interview by asking questions.

The hiring manager calls you and sets up an interview. Great! Your foot is in the door! Now what? Yes, there are the obvious steps of showing up punctually (even early) and dressing well and being well groomed and so on, but those are expected basics. The question is, how do you stand out?

The first thing you can do is practice the interview. Go through lots and lots of questions that you might be potentially asked and practice how you’ll answer them. The goal of this is not to memorize a bunch of stock answers to recite, but to be so comfortable with the things you might be asked that you can craft a genuine good answer on the fly.

If the organization is a large one, there may be some advice online for the kinds of questions that you might be asked, so tap that first. If it’s not large, look online for questions that are typically asked during interviews for positions like yours. The internet is loaded with these kinds of questions, and those resources are being used by the people who succeed at interviews.

Practice those questions. Get your partner or a close friend to come over and “interview” you by asking those questions (and variations on them). Have them take notes on how you did, intentionally looking for ways to make your answers better. Remember, this kind of activity is meant as an improvement activity and you need criticism to know what to work on and improve.

Don’t allow this practice to make you nervous. Recognize that when you do improve, you’re just making it more likely that you get the job. Treat it as a confidence builder. You’re just increasing the likelihood that you’re going to get this job.

Strategy #7: Optimize your mind and body before the interview.

All of the grooming and proper dressing techniques apply here, but you should really go beyond that. Do everything you can to ensure that you’re in the best possible mind and body when you walk in that door.

Some suggestions from my own life that I follow when I have to be primed for a key moment:

I get some exercise the day before. The day before a big presentation or something like that, I get a ton of vigorous exercise. I don’t do anything that’s going to leave me really sore, but I definitely get a workout of some kind. If you’re not much of an exerciser, just take a nice brisk fairly long walk. The reason for this is that it primes your body and mind for a great night of sleep.

Eat a healthy dinner the night before. Don’t eat something unhealthy and heavy in your gut. Eat something that’s enjoyable, but pretty healthy, and don’t eat until you’re stuffed. Don’t down a bunch of junk food in the evening, either. Again, the goal is to feel as good as possible the following day.

Get a great night of sleep. Go to bed early so that you can likely sleep until you naturally awaken without an alarm. A good night of sleep the night before a big event is one of the best things you can possibly do for yourself.

Eat a healthy breakfast with both protein and carbs. My usual go-to “power breakfast” is two hard boiled eggs, a little oatmeal, and a piece of fruit (like a banana or an orange). Nothing beats it for making me feel good all morning long.

Get a little bit of intense exercise. Don’t do a full workout, but do something to really get your blood pumping just before you take a shower. I usually go on a really brisk walk and then do a bunch of squats and planks and other body weight exercises.

Do the normal pre-interview stuff: shower, dress well, groom yourself, show up early. This is all obvious stuff, but it’s still important.

Listen to something mentally engaging but on a different topic on your way to the interview. Listen to a podcast or an audiobook that will get your brain moving, but choose a topic that’s actually different than your interview. You want your brain to be bopping along, but you don’t want to get yourself all keyed up before the interview. Think about other things, but think.

That’s my routine before any big event and it works really well for me. I feel like my mind and body is ready to go.

Strategy #8: Ask thoughtful questions about the company during the interview.

One of the best things you can do for your case during an interview is ask questions. That might seem crazy at first, but it serves a bunch of purposes all at once.

First, it reinforces the idea that you’re intellectually curious and are an active gatherer of information. That’s becoming more and more and more important for almost every workplace. Employers want intellectually curious information gatherers because those people tend to prepare well and solve problems on their own.

Second, it helps you learn more about the organization and whether you actually want to work there. Is this a place you really want to work? Is this a place where you’ll fit in well? What are the quirks of the organization’s culture? By asking questions about the organization and the people that work there, you’re satisfying those internal questions.

Finally, the answers to those questions might give you strong clues about what to mention going forward. One of the best things that a person can do during an interview in my experience is to take something they just learned about an organization and integrate it well into their own answers about why they’re a good fit for the organization. That, to me, is almost always a sign of a top candidate. It exhibits almost everything an organization looks for in a candidate.

Remember, you’re learning about them as much as they’re learning about you.

Strategy #9: Take notes during the interview, especially names of people you have significant interaction with.

Don’t do this in an ostentatious or detailed way. One great thing to do is to just take a small pocket notebook with you and then use it to just jot down names and other really key pieces of information as you go. Gather business cards and slip them inside the pocket notebook along the way.

My favorite strategy is to collect business cards throughout the meeting, then when I have a moment or two of downtime, I jot down a specific thing or two to follow up on on the back of that person’s card. If no card is available, I’ll just jot down their name and a follow-up avenue or two.

Similarly, jot down anything that you’re asked about that you’re not perfectly familiar with. Not being familiar with everything is perfectly okay. The real question is how you handle unfamiliarity. If you handle it with curiosity and grace, and you do this by not getting upset and writing down the thing you’re unfamiliar with, then that’s a good sign.

You should also record anything important that you want to remember about this interview going forward, including immediate thoughts about the company and position. Obviously, don’t record anything that shouldn’t be disclosed. They may ask you to share what you’ve written and don’t hesitate to do so.

Strategy #10: Follow up with an email and a handwritten note.

Here’s a secret: When you walk out of an interview, you’re not done with the interview. Over the next few days, you have your real chance to close out the interview.

The first thing you should do, within a day or so of returning home, is to send a handwritten thank you note to anyone you interacted with in a significant way during the interview. You should have written down their names during your note-taking process, as alluded to above.

Send individual notes. Thank that person for the opportunity to interview. Then, if you’ve noted something to follow up on, do it in a general fashion. For example, if they’re facing an upcoming challenge, wish them well on that challenge. If you don’t have anything like that, state something that you really took away from interacting with them that reflects on that person positively, like how you appreciated their explanation of the intellectual challenge of the job.

Wait a day or two after sending those notes, then follow up by email. Again, thank the person for taking the time to interview you. This is the time to really follow up on everything that was mentioned in the interview that you noted. Show that you actually followed up and self-educated on a topic that someone raised during your interview that you didn’t know. Touch base with that person on the things you noted for follow-up. Set it up so that they’re motivated to email you back, so that you can exchange a few emails with that person. Be very positive and thankful here.

Don’t go any further than that. Don’t be pushy. Don’t stalk them. Don’t friend them on Facebook. You might follow them on Twitter, but do so only if there is mutual professional interest and you might want to genuinely add that person to your professional network.

These steps reinforce your name in a very, very positive way in the days leading up to that person helping decide whether you’re the right person for the job. Some non-pushy positive interactions in the days between the interview and the hiring decision is going to help.

Final Thoughts

One final point that’s extremely important here – even if these steps don’t net you the job, they’re still incredibly worthwhile. Why? By doing these things, you’ve put your name in a positive place in the minds of the people who are doing the hiring. You’ve basically turned a lot of those people into positive professional contacts, and when another opportunity comes around, the value of those contacts is going to immediately elevate you.

I speak from experience here. I was once involved with a hiring process where there were two very good candidates. One of them was just absolutely perfect for the position and she got that job, but another candidate who wasn’t nearly as perfect for that position wowed us by going through most of these steps. He made every possible effort to show that he really wanted to work for us, and we remembered it. Guess what? That guy was hired for a very similar position (that I believe was newly created) within just a few months. The person in charge of hiring actually reached out to this candidate to apply for the second position, just because of the impression he made with the first one.

Remember, you’re selling yourself. Selling yourself isn’t easy for a lot of people – myself included – but when you take the time and effort to actually do it, it really makes you stand out from the crowd, and standing out from the crowd in a positive way is how people get the jobs they want.

Good luck!

Related Articles: 

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Monday, May 29, 2017

Questions About Moving, Apartment Babies, Weight Loss, Denim, and More!

What’s inside? Here are the questions answered in today’s reader mailbag, boiled down to summaries of five or fewer words. Click on the number to jump straight down to the question.
1. Arguing over frugality
2. Selling possessions before big move
3. Maximizing lifespan of blue jeans
4. Cheap deep fat fryer setup
5. Cracked tablet screen
6. Resolving debts to family members
7. Clothes during weight loss
8. Baby advice in tiny apartment
9. Car downsizing as a parent
10. Subscription service as gift
11. Roth TSP or normal TSP?
12. Basics of learning about money

Over the past few days, I took a trip out to Denver by myself to visit a family member and several friends. I had been intending to see them for a long time but had never really made the time to do so, but Memorial Day weekend offered that opportunity.

I drove out there and the thing that sticks in my mind about the entire drive is how the landscape slowly changed from the flatness of Nebraska and Kansas into the rise in altitude and the mountains on the horizon in Denver. The shift is gradual, but if you drive 100 miles or so from the western end of Nebraska well into Colorado, the change is really noticeable.

It’s funny – I can travel for several days and the things I remember about the trip are all about the landscapes and about the people I was with. Expensive meals fade quickly. So do expensive hotels. What I remember are the people and the scenery. To me, that’s a hint as to how I should plan vacations.

Q1: Arguing over frugality

My hubby and I sometimes argue about my cheapness. Whenever we have date nights I usually suggest doing something cheap and I buy store brands at the store and stuff. Sometimes he gets really frustrated and says that we don’t have to live like this and gives me the cold shoulder for a while. I don’t see anything wrong with how we live and we have no debt and plenty of money in the bank. Had a big blowup the other night. Not sure what to do and hope you have some good advice!
– Monique

Marriages work when you communicate and compromise with each other. It sounds to me like there are some areas of your spending choices that are bothering your husband.

What I’d suggest is sitting down sometime when he’s not angry and discuss things. Ask him specifically what things he’s bothered by, figure out which things bother him the most, and give a little in those areas. It may be that a certain brand of product has a strong sentimental value to him, so it’s worth buying it instead of the store brand that you buy, or maybe you can agree to his more expensive date night ideas sometimes.

At the same time, make sure he appreciates the strong financial state that you’re in and that you’re deeply worried about falling into a pattern of overspending that will undo that great financial state.

There’s a happy medium between the two things you’re both wanting here. The trick is finding it together in a peaceful way.

Q2: Selling possessions before big move

I currently live in a 1BR apartment in Sacramento. I accepted a job in Boston with a nice pay raise and am moving there in a month. My employer is paying for some moving expenses. I am considering what items it makes sense to move to Boston and what to sell off. Part of me wants to sell everything and move with basically two or three bags of stuff and then use the moving money and the sale money to buy new stuff when I arrive. I will pay a markup to replace a lot of this stuff though. Which is the smarter route?
– Jim

If I were single and moving across the country, I would probably lean toward selling off the vast majority of my possessions before the big move. I would not want to deal with the effort of moving so much stuff and, honestly, having less stuff means you have more flexibility.

To tell you the honest truth, if I were single, I’d mostly live out of a bag or two. I might have a small apartment somewhere, but it would be basically a place to rest my head and prepare a bit of food, not a place to spend my time. I’d spend a lot of time at community events, at the library, at Meetup events, and so on. I’d barely be home, so why have a bunch of stuff at home?

In your shoes, yes, I’d lean toward a big selloff. Unless your apartment is loaded with incredibly expensive decor and you plan to decorate it with similarly expensive stuff upon arriving in Boston, transporting your possessions will probably cost more than they’re worth, especially when you include the sale value of the items.

Q3: Maximizing lifespan of blue jeans

Do you have any suggestions for making jeans last as long as possible? Do they last longer if you wear them several times between washings?

I wear jeans pretty much any time I’m not in the office and so I wear out a lot of jeans and I want them to last as long as I can. My jeans usually wear out at the ankles first.
– Roger

Jeans most certainly do not need to be washed after every wearing. Inspect them when you’re done wearing them and if they’re actually dirty, wash them. If not, then don’t wash them.

Your instinct regarding the fact that washing jeans puts a lot of wear and tear on them is absolutely right. Washing machines are the primary source of damage to a lot of garments over time, and jeans are no different.

If you’re noticing a lot of wear on your jeans near the ankles, consider wearing slightly shorter jeans or “boot fit” jeans. This used to be a problem for me until I realized I was choosing jeans that were perhaps an inch or so longer than they needed to be, so now I get jeans with a shorter inseam and I rarely have this problem.

Q4: Cheap deep fat fryer setup

We often have fish fries where we will fry up a bunch of fish filets and whole fish and some onion rings and fries in a deep fat fryer that’s basically a big kettle of oil with a basket on top of a propane burner. We have to replace the burner every 2-3 years and the cost of all of the propane and oil adds up. Suggestions on keeping costs down?
– Dylan

I talked to an avid fisherman who often hosts fish fries in order to answer your question and he suggested three things.

First, if you’re just using the oil to cook fish and onion rings and fries, you can probably reuse the oil a few times. He suggests saving the oil in a big resealable container in the refrigerator between uses. At some point after it cools, strain the oil through several layers of cheesecloth at once to get out all of the tiny particle matter. He says you should be able to use the oil three times using this method before you should throw it out.

Second, he strongly encourages you to thoroughly clean your propane burner every few months because, according to him, propane burners don’t usually go bad that quick and there’s probably some clogging involved due to not cleaning it. He suggested using a cleaning brush and cleaning it thoroughly inside and out and to look up a guide on how to do it for your model if you’re not sure.

Finally, he says that if you’ve got the oil heated up, you should cook plenty of fish filets because they’re quite good when reheated and you can eat leftovers. This reduces the propane cost per piece of fish. Just store them in a container with paper towels separating the layers. If you’re making fries that are just sliced potatoes dropped in the fryer, I recommend making extras of those, too, as those are good reheated as well in my experience.

Q5: Cracked tablet screen

I have an iPad Pro which I use so much that it’s now my main/only computer. I have a keyboard case for it and use it for email and writing and then I take off the case for lap use and reading.

A few months ago, I cracked the edge of it. There’s a crack that extends into the screen area. When you’re using it, you definitely notice the crack. It’s visible when you’re watching or reading something. However, the touch interface is just dead around the crack and it makes it hard to open the app that’s in that area of the screen and can sometimes mess up other interface issues.

When do I make the leap and just replace the thing? It still works, mostly, but the cracked part is a constant annoyance.
– Connie

The first thing I’d do is look into the cost of getting the screen repaired. Is it under any kind of warranty? Did you get a protection plan for it that might cover it?

I’d take the device to an Apple Store and have them look at it and provide an estimate for repair. If it’s high, you can also talk to independent phone and tablet repair shops, who may be able to repair it at a nice price. You may find that it is far less expensive to repair the screen than it is to buy a replacement.

If you do need to go for a replacement, do your homework first and take your time. Evaluate your needs very carefully. What does your tablet actually do for you? Are there other devices that could do all of those things at a lower price? Do you need the most current version of that tablet, or would an older one suffice?

Q6: Resolving debts to family members

I am a former meth user who has been clean for three years. During that time I borrowed a lot of money from family members to feed my habit. I kept track of those debts in a notebook. Now that I have a good job I am starting to try to pay them back but all of them keep telling me no and that it is forgiven and that I have repaid them by getting clean. But I am still feeling really guilty about taking their money and using it for drugs and stupid things.

I borrowed money from my older brother, my uncle, and my mom. For my brother I am going to pay him back by putting money in a college savings plan for my nephew and for my uncle I am going to do the same for his daughter. For my mom, I am going to put money in a savings account and buy her a car to replace her old beater.

What is the best way to do these things?
– David

David, first of all, I have a ton of respect for your character, not just for getting yourself clean, but for wanting to make things right. Your family is full of awesome people, too, as they seem to have just forgiven this debt that you owe to them.

If these moves will make your conscience clear, then you should absolutely do so, but you shouldn’t feel like you have to. Consider this not a repayment of debt, but a gift back to them.

It’s pretty easy to start a 529 college savings plan with a relative as a beneficiary. Just look up the 529 system in your state and start plans for each of those two children and start socking away money in there when you can until you feel things are right. If I were you, I’d keep quiet with the account until they start to move toward making plans for their post-high school lives, then I’d tell their parents first. It’s pretty hard for a parent to refuse a 529 with their kid on it as a beneficiary.

As for your mother, I’d simply sock money away in a savings account, and do it as quickly as you reasonably can so that you can replace that old car that sounds like it might be on its last legs. Just get a savings account at your local bank and start socking money away in there.

You’re making great moves here and it sounds like you have a good family around you. You’ll be just fine.

Q7: Clothes during weight loss

In November I weighed 415 lbs and now I’m down to 355 and I don’t intend to stop. I’ve figured out a rhythm that really works for me and I can stick with it for the rest of my life. I mostly eat what I like for supper with some portion control in mind and eat healthy stuff for other meals.

My problem is that a lot of my clothes aren’t fitting well any more – they are really clown sized on me. I intend to lose another 100 pounds in the next year, so if I buy anything that fits well right now, it will be too big in a few months too.

What’s the cost effective approach to clothes that you will only wear for a while?
– Tim

The best approach you can take is to shop for your entire wardrobe (sans underwear and socks) at Goodwill and other secondhand stores for now and only switch to buying other garments when you start to get really close to your target weight.

I highly recommend going to secondhand clothing stores that are fairly near wealthy neighborhoods, because you’ll often find that such stores are loaded with items that are high quality and practically new. I am amazed at the clothes items that can be found at secondhand stores near the pricier neighborhoods in Des Moines, for example.

Just buy whatever you like that fits. Since all of it is pretty inexpensive, you don’t have to worry about it too much. Then, in six months, when those clothes don’t fit well any more, take the whole bundle back to a secondhand store. You’re effectively renting those clothes for pennies per use.

Q8: Baby advice in tiny apartment

My wife and I share a 400 square foot studio apartment. We currently are expecting a baby in early October. We considered moving but the cost of everything around here is so high that we just can’t make a larger apartment work and a house is just out of the question.

I came across some of your early articles where you describe living in a small apartment with a baby. Do you have any advice on making it work?
– Stephen

To back up a bit, in 2005, my wife and I welcomed our first child into the world. From 2005 to 2007, we lived in a roughly 600 square foot apartment with that baby and didn’t move until a second one was on its way.

The best trick you can use is to recognize that, besides a crib of some kind, you really don’t need much large stuff devoted just to your baby. You don’t need a changing table, as you can basically turn any surface into a changing table with a towel. You don’t need lots of big toys or anything like that. A baby needs love, food, clean clothes, closeness, and soft words. You can provide all of that with very little stuff.

Just focus on what you need for the baby, not what you think you should have. Quite often, a baby’s actual needs are much less than the stuff that parents are tempted to buy during the “nesting” period, where hormones are telling people to prepare their home for a baby and marketers manipulate that emotion like crazy.

Remember what a baby needs. A baby needs love, food, clean clothes, closeness, warmth, and soft words. That’s it. You don’t need a ton of space or a ton of stuff to provide those things.

Q9: Car downsizing as a parent

The argument I’ve always made about getting rid of a vehicle is that it means our children would have to drop out of activities they enjoy. Our two oldest children are both on soccer teams for example and there are just times where it is impossible to get them both to their practices or games without two cars. One of them at least would have to drop out of soccer if we downsized a car.
– Anna

There are definitely life situations where downsizing a car isn’t the best move for you or your family. The thing that really matters is whether the question is even being considered or not, and if it is, whether it’s being considered seriously or not.

If you can point to routine things – things that actually happen on a regular basis in your life – where your current vehicle count is necessary or provides a tremendous time savings, then it probably doesn’t make sense to downsize. It sounds like you’re in that very situation when it comes to soccer practices.

For us, the real challenge would be situations where our children are sick at school, which happens every few months. I am at a loss as to how we would handle that situation. Normally, given my job flexibility, I simply go get sick children and take care of them, but if I were without a car, I couldn’t do that. We’ve brainstormed many times to try to come up with realistic solutions to this problem (and a few other similar ones) and we haven’t figured it out. So, for now, we remain a two vehicle household.

Q10: Subscription service as gift

What do you think of giving someone a subscription to a service that delivers boxes of goodies each month? Are these good gifts?
– Tammy

I think the idea behind it is good. If you put in the time to choose a service that really matches their interest, then it’s worthwhile.

However, the vast majority of the time, the contents of the crate simply don’t add up in value to make the sticker price worth it. It just doesn’t add up.

Most of the time, you’re better off finding a hobby store that the person you love is really into and buying them a gift certificate to that hobby store. Figure out what they like, figure out a really good retailer that caters to that hobby with really good prices, and give them a gift certificate to that store equal to what you would have spent on the crate subscription. The recipient will then get a lot of stuff he or she really wants from that certificate rather than the mixed bag that comes in a crate.

Q11: Roth TSP or normal TSP?

I am a federal employee and want to start contributing to my TSP but I do not understand the difference between Roth TSP and regular TSP. The guy at work that tried to explain it just left me more confused. Which one should I pick?
– Brenda

So, you’ve gathered that TSP is the Thrift Savings Plan, which is a program for government employees to put aside money for their retirement. The way both TSP plans work is that they take money directly out of your paycheck and put it into your TSP account. Once it’s in there, there are restrictions on how you can use it, but in general, if you wait until retirement, you can use it more or less however you wish.

To understand the difference between the two, you need to step back and think about your paycheck before TSP. As it is now, you get paid a certain amount, income taxes are taken out of that amount, and you receive a paycheck after those taxes are removed.

With a traditional TSP plan, you get paid a certain amount, then the TSP money is taken out, THEN taxes are taken out, then you receive a check out of what’s left.

With a Roth TSP plan, you get paid a certain amount, then taxes are taken out, THEN your money for your Roth TSP is taken out, then you receive a check out of what’s left.

Imagine, for example, that you’re paying 20% of your salary in income taxes and you’re contributing $100 per paycheck to your TSP plan. You make $1,000 per paycheck before anything is taken out.

With a traditional TSP, you get paid $1,000, you put $100 of that into TSP leaving you with $900, and then you pay 20% income tax on that $900, which is $180. You thus bring home $720 each paycheck.

With a Roth TSP, you get paid $1,000, you pay 20% income tax on that $1,000, which is $200, which leaves you with $800. You then put $100 into your Roth TSP, which means you bring home $700 each paycheck.

So why would a person ever use the Roth TSP? Well, the Roth TSP has a really big advantage when you retire: the money you take out of that account is tax free. You don’t have to pay income taxes on it in retirement. On the other hand, when you take money out of your regular TSP in retirement, you will have to pay income taxes on that money.

Which is better? It depends really on how flush you expect your retirement to be. If you’re young and plan on contributing for a lot of years, having at least some of your money in the Roth TSP is a good idea. If you’re older and won’t have a whole lot of years to contribute and don’t have other retirement savings, then you won’t save much in retirement with a Roth TSP and the other way is the right way to go.

Honestly, though, the fact that you’re saving at all blows away the relative advantages of each plan. One might cost you a little more than the other in taxes over the course of your life, but the difference won’t be enormous unless you’re saving a ton of money.

With all else being equal, I tend to lean toward the Roth option, simply because I don’t believe tax rates will remain this low forever and I’d rather pay lower rates now. I believe rates will go up, and thus they’ll be higher in retirement, and I’ll be glad to have money in a Roth so I won’t have to pay it then.

Q12: Basics of learning about money

Where should a person go to learn the basics about money? Like how to invest money and how to plan ahead for the future?
– Terry

If you’re looking for a good starting point, I’d suggest one of several personal finance books out there. My own book, The Simple Dollar, is one good entry point. It’s kind of a mix of memoir and personal finance advice.

For my own self-education on money, the most valuable books I picked up were Your Money or Your Life by Joe Dominguez and Vicki Robin, The Total Money Makeover by Dave Ramsey, and The Bogleheads’ Guide to Investing by Taylor Larimore, Mel Lindauer, and Michael LeBoeuf.

You can get any of those books at your local library for free. Just head down there, get a library card if you don’t have one, and borrow them for a few weeks! If you find one is really useful as a reference, then consider buying it!

For online reading, a great place to start would be my own book-length series, 31 Days to Financial Independence, which is entirely free.

Got any questions? The best way to ask is to follow me on Facebook and ask questions directly there. I’ll attempt to answer them in a future mailbag (which, by way of full disclosure, may also get re-posted on other websites that pick up my blog). However, I do receive many, many questions per week, so I may not necessarily be able to answer yours.

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The Truth About Dollar Cost Averaging

Dollar cost averaging is a popular investment strategy that usually gets even more popular in environments like this, where all-time market highs and political uncertainty have people worried that the next big stock market crash could be just around the corner.

And while dollar cost averaging can absolutely be a good way to ease yourself into the market, it’s a strategy whose benefits are often oversold and misunderstood.

In this post we’ll explore exactly what dollar cost averaging is, what the benefits and downsides are, and what alternatives you have so that you can make the right decision for your situation.

What Is Dollar Cost Averaging?

Dollar cost averaging is the practice of investing your money a little bit at a time instead of all at once.

Let’s say that you just received your bonus and you have $4,800 that you’d like to invest for the long term. You could invest it all right away, or you could dollar cost average by investing, say, $400 per month over the course of a year.

Why would you do the latter? The idea behind dollar cost averaging is two-fold:

  1. You reduce the risk that a market crash in the near future would affect all of your money.
  2. By investing the same amount every month, you automatically buy more shares when the market is down and fewer when the market is up. This is the “buy low” half of the “buy low, sell high” strategy and could, theoretically, improve your returns — though we’ll largely debunk this theory below.

To be clear, this is not the same as making a consistent contribution each month or every time you receive your paycheck. That’s a good practice, but it’s technically not dollar cost averaging because you are actually investing all of the money you have available to save as soon as it’s available.

Dollar cost averaging is really for situations like receiving a bonus or inheritance, or wanting to move money from a savings account to an investment account. Rather than investing some of your income as you receive it, these situations give you an unexpected sum of money that you have to decide what to do with.

The Benefits of Dollar Cost Averaging

There are two big arguments you’ll hear in favor of dollar cost averaging, one of which is truer than the other.

1. It Reduces Risk

Dollar cost averaging reduces your investment risk, which is the main benefit. By keeping some of your money out of the market for some period of time, your overall investment strategy is temporarily more conservative and less susceptible to a market crash.

There are other ways to reduce risk, which we’ll get into below, but the real reason this matters is because this reduced risk can make it emotionally easier to start investing. And since investing is such an important part of building long-term wealth, anything that helps you start is worth a look.

2. You Buy Low

Some proponents of dollar cost averaging argue that it can actually increase your returns. Because you contribute a pre-defined amount of money at pre-defined intervals, you will automatically buy more shares when the stock market is down and fewer when the market is up. Which means that you should get better bang for your buck.

This is partially true. Dollar cost averaging does cause you to buy more shares when the market is down, and it can lead to better returns in a declining market. But as you’ll see in the next section, this isn’t the expected outcome.

The Downsides of Dollar Cost Averaging

While dollar cost averaging does reduce your investment risk, there are a few downsides to consider before jumping in.

1. Lower Expected Returns

Almost every investment decision involves a trade-off between risk and return. If you want the chance at better returns, you have to accept a larger risk of not receiving them.

The same is true with dollar cost averaging. Although it can lead to better returns in some cases, most of the time the reduced risk comes with reduced returns.

The reason is simply that the stock market goes up more often than it goes down. So by investing your money in little bits over time instead of investing it all at once, your odds of missing out on gains are greater than your odds of avoiding losses. According to a 2012 Vanguard study, investing all of your money at once would historically have produced better returns than dollar cost averaging about 66% of the time.

Nothing is guaranteed, but the fact of the matter is that dollar cost averaging will typically lead to lower returns in exchange for less risk.

2. Straying from Your Plan

One of the biggest pieces of your investment plan is your asset allocation, which is essentially how you choose to divide your money between high-risk, high-return investments like stocks and low-risk, low-return investments like bonds.

Your asset allocation is the primary way you can manage your expected risk and return, and you should choose your asset allocation knowing ahead of time that you will occasionally lose money in down markets. The big question is how much you’re willing to lose at any one time. The less you’re willing to lose, the more conservative your asset allocation should be.

Whatever you decide, dollar cost averaging by definition causes you to stray from that asset allocation plan. By temporarily keeping some of your money in cash, you are temporarily investing in a portfolio that is more conservative than you originally decided was appropriate based on your needs and appetite for risk.

So if you don’t feel comfortable investing your money all at once, it’s possible that the real problem is that you’ve chosen an asset allocation that’s more aggressive than it should be. If that’s the case, the solution may simply be to invest your money all at once into an asset allocation that’s more conservative, and therefore less susceptible to a market crash.

3. Complexity

Finally, dollar cost averaging makes your life more complicated. Setting up and monitoring periodic contributions takes more work and more time than investing your money all at once.

And again, if you could accomplish the same end goal simply by choosing a more conservative asset allocation, it might be worth doing so simply to make your life easier.

Should You Dollar Cost Average?

With all of that background, the big question is this: should you dollar cost average or invest your money all at once?

Here’s my take:

  1. The most important thing, by far, is to save money and stay invested for the long term. If dollar cost averaging helps you do that with less anxiety, then go for it.
  2. From a purely analytical standpoint, it’s typically more efficient to invest your money all at once into an appropriate asset allocation. If pure rationality is what gets you going, that may be the better approach.

Matt Becker, CFP® is a fee-only financial planner and the founder of Mom and Dad Money, where he helps new parents take control of their money so they can take care of their families. His free book, The New Family Financial Road Map, guides parents through the all most important financial decisions that come with starting a family.

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Sunday, May 28, 2017

Five Ways Your Camping Budget Can Go Up in Flames

Camping, in its rawest form, is one of the most frugal vacation options in the world. All you really need is a tent (or some other shelter), something to sleep in or on, basic supplies for cooking and eating, and the means to start and maintain a fire. Beyond those essential furnishings and skills, everything else is free. After all, camping opens the door to a wide range of entertainment provided by the great outdoors – hiking, swimming, fishing, and biking, for example.

But, is camping always so simple and cheap? Not by a long shot. Even if your goal is relaxing in a hammock with a great book, it’s easy to go overboard when buying camping gear and supplies. Plus, it’s not always cheap or even affordable to rent a campsite these days.

The bottom line: If you’re not careful, the price tag for your “frugal” camping trip can get out of hand.

While there’s no “right” or “wrong” way to camp, there is a frugal way and an expensive way. Worried your summer camping trip might ruin your annual travel budget? Here are five signs your frugal camping trip might be spiraling out of control, plus how to stop it from happening.

Camping Mistake #1: You insist on buying a tent.

If you haven’t camped for a while and aren’t sure you’ll start camping regularly, you need to own a tent like you need a hole in the head. Tents aren’t inexpensive, and that’s especially true if you get a nice one. Even a very basic one-room tent can cost $70 or more, and most two-room tents cost a minimum of $150.

If you’re thinking you should just go ahead and buy a tent to “get it over with,” you could live to regret it when it’s just taking up space in the attic for the next 10 years. Until you’re positive that you’ll be camping regularly, there’s no need to buy your own.

Better Idea: Borrow a tent to get started.

Chances are, you know someone who has a tent already. Instead of spending hundreds of dollars on speculative purchase, borrow a tent from a friend or family member if you can. Since beggars can’t be choosers, it may not be your dream tent. Still, borrowing a tent comes with notable benefits. Not only will you save money this way, but you may learn something about the type (and shape) of tent you really want to buy in the future.

Camping Mistake #2: You’re shopping for supplies on SkyMall.

If you’ve seen the camping episode of “Parks and Recreation,” you already know the joke. Basically, Tom buys all this outrageous camping gear on SkyMall in an effort to recreate the comforts of home within a giant, luxury tent.

Truth be told, SkyMall and other stores do have some pretty amazing camping gear. These days, you can buy anything from a portable pop-up privacy tent for $39.99 to an upright camping organization container ($99.99), a portable outdoor grill ($120 and up), or a portable kitchen complete with a sink and staging area ($79.99). Heck, you can even buy a portable solar-powered wood oven, a specialized quesadilla grilling basket, or a cooler with a built-in blender, USB charger, stereo system, and bottle holder.

Better Idea: Borrow supplies, or use stuff you already own.

While fancy gear can make camping more comfortable, that doesn’t mean you need it. And if you don’t camp all the time, blowing $50 here and $100 here can make your outdoorsy trip a lot more expensive than it needs to be.

Instead of buying all the camping gadgets your heart desires, try roughing it instead. Borrow camping supplies from friends, and see what you have at home already.

Camping Mistake #3: You want to stay at the ‘party campground.’

Supplies, tents, and trailers aside, not all camp sites are created equal. Some of the “nicer” campsites offer myriad opportunities for leisure – activities like golf, swimming, and kayaking. But all those “extras” can be expensive, which is why fancier camping sites tend to charge more.

Better Idea: Camp at a cheap state or national park instead.

Never assume your campsite will be cheap. Just like anything else in life, it can pay to shop around when searching for a place to camp. While campgrounds with lots of perks might charge higher prices, you can usually get a good deal at state or national parks. Most states have their own website where you can explore options and research pricing. In my home state of Indiana, for example, we have a dedicated website for state camping sites. You can also explore federal campgrounds in your state on this page.

While prices can vary, bare-bones camping at state and national parks tends to be cheap. In Indiana, a regular non-electric campsite can cost as little as $10 per night.

Camping Mistake #4: You’re craving a gourmet outdoor feast.

The financial upside of camping is that you can avoid many of the trappings of a traditional vacation, including dining out constantly. Unfortunately, food costs can still be hard to manage if your expectations are out of control.

If your camping goal is whipping up some steaks on the grill, a shrimp boil, and every side dish under the sun, you can count on spending a bundle. And let’s not forget that camping can be wasteful – there’s no fridge to save leftovers. Not only must you bring your main ingredients, but you need condiments, dressings, oils to cook with, and seasonings. Whether you’re camping or cooking at home, those costs can add up fast.

Better Idea: Stick with cheap staples instead.

Do yourself a favor and ensure your camp meals are cheap and easy. Instead of steaks, throw some burgers and hot dogs over the fire. In place of fancy side dishes, grill some corn or packages of vegetables wrapped in aluminum foil. The fewer ingredients you use, the less you’ll spend overall.

Camping Mistake #5: You’re in charge of food and supplies for the group.

Camping offers the perfect opportunity to vacation and connect with family and friends. There’s no television around, and we can hope people aren’t glued to their smartphones while relaxing by the campfire. Without all the distractions of home, it’s easier to bond with the people you love.

But camping can become costly if you simply build it and they come. You won’t save money camping if you’re feeding more than your immediate family for a few days or more. Plus, camping requires a lot of work – work you shouldn’t have to do all by yourself.

Better Idea: Make your co-campers bring food and supplies to share.

Since camping is great for groups, it never hurts to ask others to pitch in. Perhaps every person can bring a meal or side dish, or you can send out a list of supplies for others to bring. Maybe your friend has the cooking supplies you don’t. Or, one friend hopes to be fed but promises to bring a cooler of beer. It doesn’t matter how you divvy up the responsibilities, but if you want to save money, everyone needs to do their part.

The Bottom Line

If you have camping on your agenda this year, don’t forget how quickly the “extras” can add up. While camping itself is inherently frugal, there are plenty of ways to spend money that can make your camping trip much more expensive than a hotel stay.

Like most other activities, you’ll save money if you borrow what you can, keep your trip simple, and take advantage of all the free activities available. It’s still possible to camp on the cheap, but you have to block out all the noise and remember the golden rule of camping – less is more.

Holly Johnson is an award-winning personal finance writer and the author of Zero Down Your Debt. Johnson shares her obsession with frugality, budgeting, and travel at

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How do you keep your camping trips frugal? What would you add to this list?

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Saturday, May 27, 2017

No One Owes You Anything

I recently ran across a letter written by the writer, investment advisor, and politician Harry Browne. It was a letter intended for his nine-year-old daughter and was published as part of his syndicated newspaper column. I want to share it in its entirety:

* * *

It’s Christmas and I have the usual problem of deciding what to give you. I know you might enjoy many things — books, games, clothes.

But I’m very selfish. I want to give you something that will stay with you for more than a few months or years. I want to give you a gift that might remind you of me every Christmas.

If I could give you just one thing, I’d want it to be a simple truth that took me many years to learn. If you learn it now, it may enrich your life in hundreds of ways. And it may prevent you from facing many problems that have hurt people who have never learned it.

The truth is simply this:

No one owes you anything.

How could such a simple statement be important? It may not seem so, but understanding it can bless your entire life.

No one owes you anything.

It means that no one else is living for you, my child. Because no one is you. Each person is living for himself; his own happiness is all he can ever personally feel.

When you realize that no one owes you happiness or anything else, you’ll be freed from expecting what isn’t likely to be.

It means no one has to love you. If someone loves you, it’s because there’s something special about you that gives him happiness. Find out what that something special is and try to make it stronger in you, so that you’ll be loved even more.

When people do things for you, it’s because they want to — because you, in some way, give them something meaningful that makes them want to please you, not because anyone owes you anything.

No one has to like you. If your friends want to be with you, it’s not out of duty. Find out what makes others happy so they’ll want to be near you.

No one has to respect you. Some people may even be unkind to you. But once you realize that people don’t have to be good to you, and may not be good to you, you’ll learn to avoid those who would harm you. For you don’t owe them anything either.

No one owes you anything.

You owe it to yourself to be the best person possible. Because if you are, others will want to be with you, want to provide you with the things you want in exchange for what you’re giving to them.

Some people will choose not to be with you for reasons that have nothing to do with you. When that happens, look elsewhere for the relationships you want. Don’t make someone else’s problem your problem.

Once you learn that you must earn the love and respect of others, you’ll never expect the impossible and you won’t be disappointed. Others don’t have to share their property with you, nor their feelings or thoughts.

If they do, it’s because you’ve earned these things. And you have every reason to be proud of the love you receive, your friends’ respect, the property you’ve earned. But don’t ever take them for granted. If you do, you could lose them. They’re not yours by right; you must always earn them.

A great burden was lifted from my shoulders the day I realized that no one owes me anything. For so long as I’d thought there were things I was entitled to, I’d been wearing myself out — physically and emotionally — trying to collect them.

No one owes me moral conduct, respect, friendship, love, courtesy, or intelligence. And once I recognized that, all my relationships became far more satisfying. I’ve focused on being with people who want to do the things I want them to do.

That understanding has served me well with friends, business associates, lovers, sales prospects, and strangers. It constantly reminds me that I can get what I want only if I can enter the other person’s world. I must try to understand how he thinks, what he believes to be important, what he wants. Only then can I appeal to someone in ways that will bring me what I want.

And only then can I tell whether I really want to be involved with someone. And I can save the important relationships for those with whom I have the most in common.

It’s not easy to sum up in a few words what has taken me years to learn. But maybe if you re-read this gift each Christmas, the meaning will become a little clearer every year.

I hope so, for I want more than anything else for you to understand this simple truth that can set you free: no one owes you anything.

* * *

There is a lot of very wise financial truth contained in that letter, principles that apply brilliantly to the personal finance journey (and life journey) that we all find ourselves on.

No one owes you anything.

No one owes you the money to retire on. Yes, you’re due some money from Social Security, but only if you’ve paid into it. If you’re lucky, your organization might have some kind of pension plan for you, but that’s part of your compensation for working there.

Everything else is up to you. It’s up to you to save for your retirement if you want to have a comfortable retirement. You need to be putting money aside in a 401(k) or a Roth IRA or a similar plan.

No one owes you great treatment. People are free to treat you however they like.

What you do control, however, is who you choose to associate with. You can choose to associate with people who treat you well in return for you treating them well. You can choose to associate with people who are doing great things and can inspire you to make better choices in your own life. You can choose to associate with people who are sources of great advice and wisdom and insight and knowledge.

You can also choose not to associate with people who don’t treat you well. You can choose to avoid people who offer paths full of poor decisions.

You decide who you spend your time with. No one else decides that but you.

No one owes you a job. A job means that someone is giving you money in exchange for your efforts. If you don’t want to put forth the effort, no one is required to put forth the money.

Remember, no one is going to give you a job unless the person paying you is going to, at some point, bring in more money than they’re paying you (and the cost of the items you’re using). Jobs aren’t charities. A job is a situation someone else has set up where you can both make some money – you invest your time and effort for some of that money, while the person who bought the location and all of the equipment and figured out all the job protocols for you is making some of that money. If you’re not an efficient part of that, you won’t have a job.

You decide whether you want a job or not, and you show whether you want that job with your efforts.

The same thing is true for a promotion. No one owes you a promotion. It’s up to you to make the case that you’re more deserving of that promotion than anyone. If you can’t make that case, then that promotion shouldn’t be yours anyway.

Yeah, sometimes people get promotions that don’t “deserve” them. Again, whatever the reason was for that other person getting the promotion, it comes down to the fact that you didn’t make a good enough case to earn that promotion for yourself. It wasn’t owed to you.

The same thing is true for business. No one owes you business success. You earn it by working your tail off and proving you have the knowledge and the talent to produce a product that people want and are willing to pay for in some fashion or another.

This is true for everyone from Bill Gates to a person making YouTube videos. They all make money from their business by making – or having made – things that people want. If you can’t put together some system for doing that, you aren’t going to have success in business. It is not owed to you.

No one owes you courtesy or friendship or respect. Those things are earned, not given. You choose for yourself whether or not you want to behave in a way that earns courtesy or friendship or respect. Even then, you might not necessarily receive it, though the odds go up greatly.

These statements may seem like negative things. They might seem like a list of hard truths about life.

However, the opposite is true.

For starters, things that you haven’t earned in some fashion are relatively valueless. Think about friendship, for starters. When someone that you barely know begins acting like your best friend, it feels completely unnatural. On the other hand, when you’ve known someone for years and they act like your best friend, it feels completely natural.

What’s the difference? Your real best friend earned that status. They have shown you friendship and kindness for a long time. This new person? They may have shown you friendship and kindness really recently, but the idea that you’ve got a long-term friendship feels hollow because it is hollow. That friendship – that thing that really means something and has real value in your life – has to be built up. It has to be earned. Things that have real value are things that you’ve actually earned.

That false friendship isn’t going to feel like a major loss to you if it disappears. However, if that close friend you’ve had for years disappeared, you’d know it. It would hurt. Why? Because that close friendship has value. That value isn’t owed to you. That value is built over a long period with a lot of little efforts that add up to something big.

Another truth: You are largely in control of your own destiny. Yes, outside events can and do happen, but you decide whether or not you have a good shot at that promotion or whether you’re never going to get it. You make that choice through your regular actions. Have you earned that promotion? Undoubtedly, decisions are made outside of your control that are sometimes completely unfair, but that still doesn’t make it okay for you to not make the best case for yourself.

You decide what you think about. You decide what you do with your time. You decide what you do with your money. You decide how much effort to put in. You decide whether to keep bearing down on that task or to get distracted by social media or to get into a conversation at the water cooler.

Those are your decisions. No one else makes them but you. Over the course of a lot of those decisions, you shape what kind of a life that you have.

A person with a great career has done things to build that great career. They’ve gone the extra mile to get their foot in the door. They’ve done their homework to keep their skills sharp. They’ve leapt at every opportunity to step forward and succeed.

Can you say the same about yourself?

A person with a lot of friends has done things to earn those friendships. They’ve put themselves in social situations. They’ve reached out to others with common interests and values. They’ve coordinated countless social events for themselves and others. They’re there when their close friends need them.

Can you say the same about yourself?

A person with sustainable wealth has done things to preserve that wealth and often to earn that wealth. They’ve spent less than they’ve earned over many years. They’ve made smart financial choices year after year after year.

Can you say the same about yourself?

A person with great fitness and a healthy looking body has done things to preserve that health and look. They’re careful about almost everything they eat – you might see them eating treats sometimes, but it’s likely that most of their other meals are extremely healthy. They devote time to exercise and getting in better shape.

Can you say the same about yourself?

A person who is considered wise has done things to cultivate that wisdom. They have spent a lot of time observing people and situations and then counterbalancing that with the teachings of great teachers and readings from great books. They’ve thought carefully about their own experiences and what they’ve learned and can combine all of that together into sage advice.

Can you say the same about yourself?

You see, the truth is that the big picture of your life is made up of how you use each day, each hour, each minute.

You decide whether you’re building a valuable career with nearly every workplace choice.

You decide whether you’re building a healthy financial portfolio with every dime you spend.

You decide whether you’re building a strong family with every single choice you make to spend time with them or to do other things.

You decide whether you’re building a strong social network with every single choice regarding whether you choose to be social or curl up in a safe ball in a comfortable chair.

You decide whether you’re building wisdom with every single choice regarding whether you reflect on life and face challenging materials and ideas or whether you watch a reality television marathon.

Those are choices that you make. No one else makes those choices but you. You decide whether you want to find success in the areas of your life that you want. That success is not owed to you. It is the outcome of all of your little choices about how you live your life, how you act toward others, how you use your time.

If you want to succeed at finances – or at anything else in your life – that success is going to be borne solely out of a long series of positive choices. That doesn’t guarantee success, of course, but it is a required ingredient. If you aren’t making positive choice after positive choice, if you aren’t taking positive action after positive action, the success you want isn’t going to happen. Success is not owed to you.

Whenever you feel unhappy about the state of things in some aspect of your life, remember that no one owes you anything. Instead, the things you want are largely earned. Yes, unfortunate events happen, but it is entirely in your court as to whether that cloud has a silver lining or not. Yes, great events happen, but it is entirely in your court as to whether that advantage does to waste.

The ingredient that matters is you. What are you going to choose to do?

Are you going to buy that silly thing at the gas station? Are you going to whip out your plastic at that big clothing sale? Or are you going to keep your wallet in your pocket? Making the right choice again and again is the foundation of financial success.

Are you going to sit there and browse social media for a while? Are you going to spend an hour pretending to work so that your boss will leave you alone? Or are you going to knuckle down and do the work? Are you going to spend some focused time sharpening your skills? Are you going to build some great workplace relationships or connections to people in your field? Making the right choice again and again is the foundation of career success.

Are you going to just toss the first idea you have out there and expect customers to come to your door? Are you going to instead hone that idea over and over again until it’s rock-solid? Are you going to research every single cost and write an effective business plan for your idea? Are you going to get feedback on your plans and revise them and get more feedback until you feel ready to launch? Making the right choice again and again is the foundation of a successful side gig.

Are you going to sit on your couch and wonder why your phone isn’t dinging constantly with texts? Are you going to go out to some kind of community event tonight? Are you going to make it your goal to connect with at least five people in the room well enough that you exchange contact info? Making the right choice again and again is the foundation of a great social network.

Even if bad events happen, you’ll overcome them with these steady good choices. If great fortune happens, then these little choices will just accelerate it.

On the other hand, if you make a steady flood of bad choices, unfortunate events will just accelerate the collapse. Even good fortune will eventually be devoured by lots of little bad decisions.

You are not owed financial success. You are not owed career success. You are not owed business success. You are not owed social success. You are not owed success. You make it with a flood of these little choices.

No one owes you anything. It’s up to you to make the things you want.

What are you going to do today?

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