Tuesday, March 31, 2009

Dealing with Details-Saving Money by Using Less

by janine bolon

A girlfriend of mine was visiting last week. While we stood in the kitchen catching up, I was busy mixing up some scones. (I love baking from scratch.) As I finished rolling them out and putting them into the oven, my girlfriend let out a gasp that made me think she was about to collapse! “I would never have thought of that in a million years, Janine.” I was confused for a moment and then it dawned on me what she was talking about. I was taking all the flour from my countertop that I used to roll out the dough and I was putting it back into the flour bin. I have a fine mesh strainer I use for this process and I just sift the flour back into the main container. This keeps any dough lumps out of my clean flour. This system is so route for me I don’t even think about it.
One day over 11 years ago I had figured out how much money I would save a year by returning flour from each roll-out of biscuits, scones, breads, or pie crusts into the bin. It amounted to $5 for the year. So I went out and bought a strainer for $3 and have been using it ever since. Over the course of 11 years I’ve saved a minimum of $55 on flour using the sift-back system. I say minimum because when I first figured out the savings rate 11 years ago I wasn’t cooking from scratch as much as I do now. I make something using flour and rolling it out at least 4 times a week. Now you may think, “Janine, this is ridiculous! I mean, a $55 savings over a decade for this?!!! Not worth my time.” That is where you may be a bit short-sighted, dear one. I want you to think past the reference of scones and biscuits and think about all the products you use in your home every day or several times a week.
If you save a little bit on each of these products you will be saving yourself hundreds of dollars a year and thousands of dollars in a decade. Think about all those things you do during a week that may be costing you money because you use too much or you don’t recycle it within your own house. Here are some tips I’ve learned from various sources over the last decade that have helped me to save pennies a day that add up to thousands over a ten-year period.
Washing Dishes - When you wash dishes in the dishwasher do you fill the cup all the way up with detergent? This may sound silly, but I tested my detergent in my washer by using less and less until I found the amount “required” to get my dishes clean. This amount is exactly one third the quantity the cup can actually hold. Now when I buy dishwasher detergent I dump it all out of the box it comes in and I put it into an old ice cream bucket (yes, I get the powder kind). I have a special scoop I use that has the exact markings on the side of it (I made the lines with a permanent marker) so that anyone in my family from Dad to the 5-year-old knows the exact amount of detergent to put into each dishwashing load. Side Note: I had a dishwasher repairman out to look at the hard water issues we have in this area of the country. He then told me that the rinsing agents now available for dishwashers actually keep the seals and rubber parts of your dishwasher in good shape and are worth the money to keep him from coming out to repair those pieces. Good to know, yes?
Laundry - When you wash your clothes how much detergent do you use? Again, I used the same system here that I did for my dishwasher, I kept using less and less cleaning compound until the results showed (grey-looking whites) and then I brought the quantity of detergent up a bit and have used that amount ever since. Again, my scoop has special marker lines to show all members of the family just how much to use. My 7-year-old was teaching my 5-year-old how to do laundry and she suggested, “Then you add this much detergent to the load. Follow the Mom Line and it will be just enough.” That was payday for me!
Toothpaste – Why do you put a full glob of toothpaste on your toothbrush? Do you spread out the gel so all the bristles on your brush are covered? You may want to rethink the quantity of paste-per-bristle ratio. If you look on most tubes of toothpaste they tell you exactly how much to use. On my particular brand, it says, “Put a pea-sized amount” on the toothbrush. Wow! That certainly is different from the packaging on the outside of the product as well as the commercials. I mean you can frost a cake with the amount of toothpaste they use, right? Okay, maybe that was extreme!
Size/Color of Containers – Did you know there is a psychological behavior that the lower the contents of a container the less a person uses? Why not use this data to your advantage when it comes time to put out the hand soap, dish soap, shampoo, etc? I have proved this research to myself by putting small bottles that were half full of shampoo and soap in the shower for my family to use. It takes them longer to run empty then if I filled them full each time they got low. Next time you’re out shopping you may want to think about getting some clear containers for all your liquid soaps, shampoos and conditioners.
To some of you this list of tips might seem silly, extreme or down-right unprofitable, but in actuality it is amazing how much money you’ll save over the course of a few years by doing these simple little tests to determine the cost/benefit ratio of any particular product. I had one client tell me in exasperation, “Janine, it will take years for this to really make any difference!” My response to him was, “Well, how long will you be washing your hands, shampooing your hair, doing dishes and laundry?” Folks you’re going to be doing all of these things for the rest of your life, right? At least I HOPE so. A few of us may go bald between now and then, but for the most part there are hundreds of little things you can do to save money.
The point is this. Little savings add up BIG in this area. This is exactly the same principle that compound interest uses to create huge rewards by the end of a 30-year savings cycle. If you would like additional ideas on how to do more with less, I recommend you read Amy Dacyczyn’s “The Tightwad Gazette.” You can get it from most libraries and it only costs around $20 to purchase. You can also visit my web site to the list of books I have reviewed that I think are worthwhile reads for saving cash.

Tuesday, March 24, 2009

Losing 20 Pounds in 5 Seconds

by Janine Bolon

Yesterday was the first day I had done any weight training for 3 weeks. Ouch! As I was warming up I could feel I had lost muscle mass and I wasn't amused, but that is the challenge of traveling, isn't it? The family and I had been on-the-road as my husband and I attended conferences and did some guest lecturing at various universities. We had fun, but my physical fitness had suffered.

After the warm up I was busy "trying" to do my push ups. To be honest I just hadn't made time to do my routine while I was gone and I was now paying the price. Before going on the lecture circuit I was doing 15-18 military style push ups. Now, I was down to FOUR!!! "FOUR!!!" I yelled in indignation. My 7-year-old son asked me what was wrong and I told him that I was having to start over. Almost from the beginning, but not quite as bad as ground zero. "What does that mean, Mama." was his reply. "It means, dear, that you Mom has to lose some weight FAST!" I started pulling off weight from the barbell. 20 pounds ... Ugh! All that work to get trim, lean and mean and I was having to lose the weight because I would hurt myself if I tried the 50 pounds now!!!! Grrrr.

While I was adjusting all the weights to MUCH lower amounts it occurred to me how far I have come on my physical as well as financial journey. A few years ago (okay, ahem, decades!) when I was weight training if I had this sort of set back I would have seen myself as a failure. However, yesterday, I saw it only as a minor irritation and a bump-in-the-road. No abusive self-talk necessary. Thank you very much.

It is the same with our financial walks. We will have times were we have to pull from the savings account and almost zero out the account. For those of you who are living on the 60/40 plan you know the challenge of getting your savings account started and increasing as you pay down your debt. Then, BAM! Something happens, a child gets sick and has to go to the Urgent Care Center, or your car decides to stop charging the battery because the alternator needs replaced, or you have an electrical problem in the house that has suddenly cropped up. (By the way...all that happened to us last week! No kidding.)

When you are struggling and need a boost of confidence while saving money or losing weight or kicking some other habit here are some things that have helped me be successful:

  • Don't even think about giving yourself a bad time. Don't be nasty to yourself and don't tell yourself you were stupid, lazy, ugly, or inadequate. You're trying to change here...you are going to be falling down. The point is, don't stay down. Stand back up and start over making adjustments. (In my case, pulling 20 pounds off the bar and only doing one set of weights for the next week.)

  • Understand that falling down is not failure. Just because you made a mistake, ate that extra piece of cake or had that cigarette, that doesn't constitute "failure." See it as a blimp on the radar and move on. You have not failed. You have to readjust your systems. Haven't you ever had a new computer? Did you LIKE all the new toolbars? I don't. I usually have to spend at least 2 hours customizing the software.

  • Learn to Laugh at Yourself. Really Laugh. Come on, folks...we take ourselves WAY TOO seriously most days. Usually the mistakes we make are not life threatening. There are usually options, people or resources that can help us out. Stop treating each bump-in-the-road as a mountain and laugh at yourself. People always bring up how much I laugh and how happy I am. Well, that took practice. It too effort on my part to learn to laugh at myself. Let me tell you....I keep the heavens in constant laughter with all the silly things I have done. I assure you.

While we are all walking this road back to financial stability and, eventually, independence. Know that there are going to be areas that need adjustment and consideration. There will be times you have to slow down and watch the road a bit more carefully. Those are the points where you stop, rethink your situation and then move on. I know you can do it. I've seen hundreds of people change their lives and I know you are one of them. Now, if you will excuse me. I've got to go down to that weight bench and do a bit more lifting!

Wednesday, March 18, 2009

Real Estate and Short Sales

I was chatting with a friend on Facebook today and he made a few comments on the recent packages being offered to Homeowners courtesy of our government. Here are his options and if you would like to learn more about this situation feel free to contact Earl. He has been in real estate for quite some time and has vast experience with what is best for the hard-working homeowner. His comments to me:

By the way, I've been doing a little research on short sales and it seems like there is a lot of misinformation out there. Some people looking to get rich off of home owners who don't know any better. I read the outline of the President's plan and they want to offer incentives to approach loan modifications for owners who are in trouble. Lenders who have received federal money are required to approach a workout. But what I'm hearing is many of the "experts" are advising people to quit paying and not to bother talking to their lenders. I believe that all of us in the business have an affirmative duty to put the clients needs before our own. We can't provide loan modification services but we should be advising people to approach that first. Only if a modification can't be worked out should a short sale be considered. Obviously, there's no commission if the borrower manages to keep the home. Please let others know a short sale is considered a charge-off and it is not an easy solution.

Earl, I've done my part to let others know. If you wish to contact Earl and ask more questions on your current situation, his web site is:

Have a great week, everyone and keep up that frugal living.

Wishing you abundance,


Tuesday, March 17, 2009

Why are you Saving Money?

by Janine Bolon

I was attending a wedding of a student of mine when a group of her family walked over to the table where I was enjoying the bride’s company. As they approached, she commented, “Oh, I know what this is about, Janine. You’re to settle a bet!” You can imagine the nerves I had then.

First off, I didn’t want to cause any difficulties for the bride since being married is rarely a simple event to organize, but also, I knew only a few of her family members and I didn’t want to start the evening off by angering anyone!

As the man in the lead (I believe he was the bride’s brother) stopped by my chair and the other seven folks clustered around, he asked me point blank, “Janine Bolon? Hi, we need you to settle a bet.” Uh oh, I thought. “How may I be of service?” was what actually came out of my mouth. He then began to state the problem.

It seems that there was a bit of conflict in the group about the best way to save money (a.k.a. invest it). Should you keep it in a CD, should you keep it in Bonds, should you save enough to buy rental properties, or should you keep it in a money market fund, etc. Basically, all these questions were excellent, but each individual of the group had their own reasons for supporting each choice. After a six-minute introduction to the problem, who was in favor of which choice and what each person thought my answer would be, the bride’s brother turned to me and says, “So, what do you think? Who is right?”

After I put down my fork (the chocolate cake was to die for, and while they were talking I was eating!), I calmly asked, “Why are you saving money?” For a moment I was met with dead silence and then three of the folks around the brother said (almost in unison)”We’re saving money because you said so!”

My dear frugal friend, when it comes to saving your money and how it should be handled never take someone’s advice just because they “say so.” I felt like I had really failed these people at the wedding party. They were following the 60/40 principle without thinking about what they were doing. They now have several thousands of dollars saved up and they were arguing about how they were to invest it with family members rather than INVESTIGATING the options available to them. Each person’s needs are different. Each person has a different financial situation as well as risk tolerance. Arguing about the “one” right answer is absurd! There is no “one” correct answer. Each situation calls for a different tactic. Each person will require a slightly different strategy.

The point is simply this. No one cares more about your money than you do. Because no one cares as much about your money, you will have to be the one who does the research, collects the data and evaluates the risk. Then, you will have to make a choice. That decision is what most folks dread. Why? They fear failure. Well, guess what? I haven’t met a millionaire yet that received a positive return on every single investment they ever made. You will make mistakes with your money. Accept that fact and you will be much less stressed. Accept the fact that some investments do well while others don’t. The key is to make sure that the money you invest won’t cause you to skip the house payment for three months because the investment return didn’t pan out like you expected.

Here are some pointers when it comes to saving money:

  • First and foremost, why are you saving money? Do you want to be so wealthy you can buy an island when you’re 55? Do you want to have your own recording studio? Or do you wish to travel the world? By answering this question first, you’ll be guided on what options you will want to investigate when it comes to making your money work for you.

  • What are the goals you have for the money you are saving? Many of you have short-term and long-term savings accounts. Well, your goals for each account will determine what you do with that cash. It wouldn’t hurt to have a dollar figure allocated to each goal, either. This will give you a benchmark at which to aim.

  • Education, education, education. You must teach yourself what is a viable return on the money you wish to invest. Don’t take anyone’s word for something. Check out multiple sources on different funds and avenues. Ask around, but then, after all the data has been collected, make a choice and don’t agonize over it. You’ve done the best that you could at educating yourself.

Saving money requires a certain frame of mind that allows you to visualize what you want in the future. You also have to learn to face the fear you have of investing and do it anyway. Educate yourself as much as you can, make a choice and move on. Sometimes you’ll win big and sometimes you won’t, but the point is you’ll be moving forward and you won’t be standing around arguing about what is “right” with your relatives at the next wedding.