Listen Money Matters - Free your inner financial badass. This is not your father's boring personal finance show.

Dollar cost averaging takes the fear out of investing.  Today we’ll explain what it is and how it benefits you whether you have $5 to start with or $1000. Do you have some money that you want to invest, but you’re waiting until the exact right time to invest it? You don’t just want to dump a pile, especially a big pile of money into the market at the wrong time and watch it evaporate. There are two ways you can avoid that happening; one is the wrong way, and one is the right way. All investors have two major concerns when they invest, making money and limiting risk. We all want big profits fast with no risk. But that’s not the reality of investing. To make money while limiting risk, we have to employ a good investing strategy. Dollar cost averaging is just such a strategy; it’s good for all investors but especially for those new to investing. A Very Bad Day On September 29, 2008, the Dow Jones Industrial Average suffered one of the worst losses in Wall Street history. Upon the news that the House had rejected the $700 billion bank bailout plan, the Dow plunged 778 points. In an instant, $1.2 trillion dollars in market value evaporated. If you had been a wary investor but finally decided to take the plunge on that day, you would have had a very bad day indeed. A Very Good Day Just two weeks later, Wall Street saw its biggest one-day gain in history. The Dow added 936 points, and a record $1.2 trillion dollars surged back into the market. If you had invested that morning, you would have had a very good day indeed. Timing the Market If you had known to pull your money out before that big crash and known to put it back in the day of the big gain, you would have timed the market perfectly. But how would you know the crash and the rebound were coming? Some people think they can predict such things by timing the market. Timing the market means trying to predict the direction of the market by analyzing market and economic data. It’s a good idea in theory because like we explained above, you would hate to invest your money right before a big drop in the market and love to invest it before a big gain. So if you’ve done a bit of research, you might decide that timing the market is the best strategy. Do you have a Magic Eight Ball? Because if you do, give it a shake and ask it when you should invest. That will give you about as good a result as trying to time the market will. Professional fund managers can’t time the market with much success and not only do they have reams more data than you have, but they also have the time to pour over all of it and to understand what that data is telling them. And they still do worse than the market more than 80% of the time! Even if you did have the time and understanding to go over all that data, why would you want to? It’s boring! This is the wrong way to go about dumping money into the market if you want to protect yourself from unnecessary risk. But there is a way to do that. What is Dollar Cost Averaging? The term dollar cost averaging sounds more complicated than it is. It simply means that you determine a set dollar amount that you want to invest and invest that amount on a set schedule without regard to the share price. Here’s an example; you have $1000 you want to invest. You invest $100 a month over the course of ten months. Using this method, you will average out the cost per share so that you don’t have to worry about timing the market. Now let’s look at a more specific example; our goal is to get as many shares possible for the lowest price without making life too complicated. You have $500 to invest in Nike. The first month each share is $50, so you buy two. The second month each share is $40, so you buy two and a half.

Little tips can save you big at home.  Get some money savings tips and find out if anything you’re doing now would cause Matt to punch you in the face. People love numbered lists and we found a good one giving tips on ways to save money on energy costs around the house.  Most of the savings are small but can add up over time and many of the tips are pretty simple to accomplish.  We picked out a few good ones for you. Your house doesn’t need to fill like the tropics in the winter or the Arctic in the summer.  In the winter, set your thermostat at 68 during the day and 60 at night.  For every degree it’s set below 70, you will save 3% of your heating bill.  Put on an extra sweater, or if you have no pride or no shame, a Snuggy.  In the summer, keep the temperature between 75-78.  For every degree you raise the temperature, it will result in a 5% savings.  Invest in a Nest, it’s a programmable thermostat that you can control via your phone. Turn your water heater down to 120 degrees.  You don’t need to take a scalding hot shower.  And it should be a shower, not a bath.  A bath uses more water.   Unless you like to indulge at the end of a long work day by soaking in a candle lit bath while catching up on the latest episode of Listen, Money Matters.  Then you get a pass. This one is my favorite.  Use a slow cooker.  They are 75% more energy efficient than the oven or stove top.  Don’t be put off by those nasty slow cooker dishes people used to bring to pot luck dinners in the 80’s.  Slow cooking has come a long way.  I use mine once a week and a can of cream of mushroom soup has never been involved.  They also don’t heat up the kitchen in summer the way the oven does. As they burn out, replace your old light bulbs with compact fluorescent lights.  The CFL’s cost more, but are more energy efficient and last up to ten times longer than old fashioned bulbs. If you have a swimming pool, it doesn’t have to be a money pit.  Check out Matt’s site Swim University for ways to save money on your pool costs this summer including using a solar cover, running your pump after 9:00 pm, and using a robot pool cleaner. Spend a few hours around your home to improve it’s energy efficiency and you’ll save the environment and yourself a few dollars. Show Notes Nest: A programmable smart thermostat that can be controlled remotely via your smart phone. Betterment:  Open your account with this link and get a free $25 to start investing.

Despite being promised a “paperless society” we’re still drowning in reams of paperwork.  Find out what you need to keep and what you can toss. Do you all have a “junk drawer” in your kitchen?  Is it filled with appliance manuals to appliances you maybe don’t even own anymore?  Like the juicer, you bought for a long discarded New Year’s Resolution?  Well, you can chuck it.  That goes for electronics manuals too.  You can google any of those.  This searing revelation changed my life, or at least neatened up my junk drawer. Don’t keep bank statements, use Mint.  Many financial statements are paperless now including credit cards, rent or mortgage, and utility statements.  You just have to opt out of paper and select paperless on the company’s websites. This is good for the environment as well.  You know those annoying slick paper ads that are sometimes included in things like cable or internet service statements?  Now they don’t have to send those.  Before I went paperless I use to put them in the envelope with my check and send them back.  Time Warner can deal with their own hard copy spam! Educational records like transcripts should be kept for one to two years after you begin working.  No one will care that you took Calc 1 after your first grown up job, maybe not even before.  But better safe than sorry. Medical records for yourself and pets are important and should be kept long term.  There are certain places oversees where you may need, particularly vaccination records, for yourself or your pet before being allowed to travel. Personal records such as birth certificates, marriage license, divorce papers, and citizenship documents should be kept in hard copy form in a water and fire proof safe or perhaps a safe deposit box at a bank.  These forms can be replaced but if you need them quickly, it’s better to have them accessible. If you would like to keep more documents than your home can accommodate or that you can effectively organize and keep safe, there are some digital services that you can use.  Shoeboxed is a company that allows you to e-mail or even mail receipts to be digitized and placed into a file that you can access. You can also buy a scanner although they can be expensive and not practical for documents that are double sided and dozens of pages long like mortgage documents. There is a balance between obsessively hoarding every Duane Reade receipt and throwing out your social security card in a depressive cleaning spree.  Digitize what you can, lock up the really important stuff and let the rest go. Show Notes Ommegang Abbey Ale: The beer that heralds summer.

Most of us have homes full of stuff we never use.  It’s taking up space both mental and physical and chances are, it is how you got into debt in the first place.  We’ll show you how to reduce that debt and your clutter by selling your stuff. Take an inventory of what you plan to sell before deciding how to sell it.  Small household goods, children’s items, books, furniture.  These things will do well at a yard sale.  Very expensive items are better suited to eBay.  Not many people are going to bring $800 cash to buy a giant mixing board.  Items that are too big to be carted away in a car but too heavy to drag to the post office to ship for eBay, will do better on Craig’s List. If you have mostly yard sale goods, check with your neighbors.  Perhaps you can all do your sale at the same time which will bring more people to all the sales.  Also check with your local town.  Some have a town wide sale that you can join for free, while the town takes care of the advertising. Craig’s List can be frustrating.  There is a lot of back and forth with would-be buyers, some people tell you they want to buy your item, arrange a time to collect it, and then flake out.  Craig’s List is a good option for certain items but you will need a bit of patience. If the last time you listed something on eBay was ten years ago, things have changed.  The process has been streamlined and is much simpler for sellers to post items.  You do have the hassle of shipping but the buyer’s are more reliable than Craig’s List buyers and you can coordinate your sales so you can just ship everything in one trip to the post office.  [tweet this”You dug your debt ditch with all this crappy stuff.’} Free your self of all that stuff weighing you down.  You’ll feel better and be able to put the money you made toward paying off some debt or adding to your investments. Show Notes Ommegang Abbey Ale:  A rich, fruity beer. One Village Coffee:  Matt’s favorite coffee.

 If you have debt, it’s time to tackle it. When it comes to methods of debt reduction, there are many options to consider. Everyone has debt, it’s how we reduce and manage it that sets us apart. But which should you use to get out of debt snowballing or stacking? Some of the more popular debt reduction strategies include debt snowballing and stacking. But, which is better? I’m going to tell you right away; monetarily speaking, stacking wins. But nothing is ever that simple. Both methods have their merits and their drawbacks. We’ll take a detailed look at each so you can decide what method will work best for you. Lots of Debt Forty million of us have student loan debt to the tune of $1.2 trillion dollars. Seven million of us are in default on those loans. Credit card debt isn’t much better. We have $712 billion in credit card debt outstanding, an average of $15,355 per household. Your debt is an emergency, but you can pay it off. Snowballing Method Snowballing means listing all of your debts in order of smallest to highest dollar amount and then using any extra money to pay off the smallest balance while only paying the minimums on the others. If you have a $5,000 student loan at 4% interest, a credit card balance of $6,000 with 17% interest, and a $10,000 car loan with 9% interest, you pay off the student loan first, followed by the credit card and finally the car. Once the smallest debt is paid, you move to the next smallest using the same strategy and include the amount you were paying on the first debt into your monthly payment on the next. You continue to do this until all of the debts are paid, the largest being last one to go. Stacking Method To use the stacking method, you list your debts in order of highest to lowest interest rate, regardless of the dollar amount of the debt. You throw as much money as you can at the debt with the highest rate of interest. If you have the same debts we listed above, they would be ordered this way; the $6,000 credit card, the $10,000 car loan, and finally the $5,000 student loan. Once each debt is paid, you move down to the next highest interest rate one, again, using the money you were paying towards the last debt, and do the same. So on and so on until all the debts are paid. Snowballing Pros A big pro for this method is the psychological win it provides you. It’s so satisfying to cross a debt off your list. That boost can also give you momentum; you killed that one, you can kill all of these debts! This kind of boost is no small thing. Snowballing also makes your life just a little bit easier. Each debt paid off is one less payment you have to remember to make, one less check to mail or electronic payment to schedule. This method is also likely to be faster. Paying off the smallest debt first might mean you can get rid of it in just a couple of months. Snowballing Cons It’s a big one; it costs more money, in the end, using the snowballing method. Interest is powerful, and when it’s working against you, it’s working hard. It also takes discipline to use this method. You free up money more quickly because you’re killing off those smaller debts faster than with the stacking method. What you’re supposed to do with that money is put it towards the next debt on the list. But you didn’t get into debt because you have steel clad discipline. You might see those extra dollars in your checking account and think...

In our on-going millionaire series we interview Brenton Hayden to learn how he retired at 27, how he manages his money now, and what he does now that he’s not in an office everyday. Brenton started his career working in grocery stores where he met people who worked for the Kellogg company.  He went from making $14 an hour to $100,000 a year.  After a lay off he wanted to keep making the same money and found that real estate was the way to do that for a young person. Brenton started out as a real estate agent.  He was making great numbers when one day his mentor called him into his office and fired him.  But not for the usual reasons but because his boss felt he should use his entrepreneurial drive to start his own business.  While working in real estate Brenton found a gap in the market.  His clients were desperate for someone to help them rent and manage their properties.  At age 21 Brenton started Renter’s Warehouse which is now the second largest professional landlord in the country. Brenton didn’t take the traditional college path.  As his company grew, it was outpacing his experience.  He took some classes at MIT and Harvard which taught him what he felt he was missing.  He didn’t spend years in school, but dipped in and out so he could fill in the gaps in his knowledge and experience, a very interesting approach that could benefit a lot of people, particularly entrepreneurs. Brenton promised himself he would retire at 27.  Like a lot of people though he got caught up in running his business.  Until he went on vacation.  While away for two weeks with his wife, he was sneaking around checking e-mails and got busted by his wife.  She reminded him of his promise and he retired soon after. How does Brenton manage his money?  He spends some time day trading and largely manages his money himself.  He reinforces some things we’ve discussed on LMM.  Brenton doesn’t use a financial adviser and doesn’t feel they’re necessary.  He also monitors the news always looking  for a good opportunity to “be greedy when others are fearful and fearful when others are greedy. What does he do with his time now that he’s not working 15 hour days?  Prepare to be jealous and inspired.  Brenton had just built a race car and is going to start amateur racing.  He and his wife also travel extensively, about every seven weeks.  He recently parachuted from Machu Picchu.  I didn’t even know that was possible.  Sure beats retiring at 65 and spending your days on the golf course. Show Notes Mint:  LMM’s preferred budgeting tool. Betterment:  LMM’s favorite investing tool.

If there are two things we love at Listen, Money Matters, they are saving money and having a few drinks. Let us teach you how to best combine these two loves into a great night out. We owe thanks to our friends  Thomas Frank from College Info Geek Kristen Wong from Brokepedia for their great articles teaching us how to have fun at the bar without blowing our budgets. These are Thomas’s tips. 1.  Know your number before leaving home.  Once you start drinking, your inhibitions will be lowered.  That might mean a regrettable decision to bring home a double bagger or spending your rent money on rounds for the whole bar.  Before you leave home, decide how much you will spend that night.  Even better, take out that amount of cash and leave your credit and debit cards at home. 2.  Pay attention to drink specials.  Find happy hours in your area or drink at a local brewery.  Sometimes the special will be on drinks, sometimes you’ll get snacks with your drinks.  Since drinking makes us hungry, this can be a savings. 3.  Pregame.  This means having a few drinks before going out for the evening.  This tip can help if you suffer from social anxiety too. 4.  Tip your bartender well.  If you’re generous to your bartender, they may hook you up with free drinks or more generous pours. 5.  Planned logistics.  This is important if you’re doing a pub crawl.  Plot the bars out so you aren’t spending money criss crossing town. Now Kristen weighs in. 1.  Use sites and apps.  Save on Brew searches the best beer deals in your area.  Find my Tap will help track down which bars serve your favorite beer. 2.  Second label wines are a cheaper but still quality version of more expensive ones.  There is a site, cunningly called Second Label Wine to help find a cheaper version of your preferred vin. 3.  Drink Owl will show you a list of great drinks specials in your area. 4.  Buy in bulk.  Buying a case of wine will usually net you a 20% discount.  My local wine store does a 30% a few times a year so look out for those specials. 5.  Look at unit price.  This is a nasty trick deployed in a lot of sports stadiums.  A bigger beer may be double the price of a small but it’s not double the ounces.  Do your math! 6.  Drink shit beer.  LMM’s cannot promote this tip.  Yes it’s cheaper and cheaper doesn’t always mean worse, but in the matter of beer, it does.  Please don’t so this to yourself. Finally, beware of adulterated beer.  Beer is not made with cheap subsidy crops like corn.  Watch Beer Wars to make sure you are getting the real deal. We love our listeners so have a good time, go out, but don’t do anything stupid.  Drinking is not a hobby nor a vocation.  Drink responsibly! Show Notes College Info Geek:  Thomas Frank’s excellent site to help you upgrade your college experience. Brokepedia:  Our friend Kristen’s money saving site. Ommegang Abbey Ale: A rich, fruity ale, great for summer.

Travis Sherry from Extra Pack of Peanuts teaches us how to see the world without spending a lot by seeking out cheaper destinations, scoring the best flight prices, and alternatives to hotels that will save you a fortune. Traveling is on top of nearly everyone’s list of goals but many people don’t because they believe they can’t afford it.  Traveling doesn’t have to be expensive and there are options for almost any budget that will allow you to see the world. If you want to drink on the plane without paying ridiculous airline prices you have a few options.  If you’re flying international, choose an international carrier rather than a domestic one.  The drinks are usually free.  You can also bring those little bottles of alcohol in the quart bag you’re allowed through TSA checkpoints as long as each bottle is 3 ounces or less.  Buy them at your local liquor store, not the airport to save even more. Chat up flight attendants during their downtime.  If you’re charming you can score free drinks from them, maybe free snacks too. For a long flight, first of business class will be a lot more bearable than cattle class.  The difference in ticket price can be as much as fifteen times higher though.  This is where frequent flyer miles come in handy.  A coach round trip ticket bought with miles will be around 35,000 miles,  business just double that.  You can obtain miles through credit card sign up bonuses and by flying the same airline as much as possible.  Check to see what airline has a hub at your local airport and sign up for their free frequent flyer program. Price flights through ITA Matrix.  You can’t book via this site but the price you find can be booked through a site like Kayak or Hipmunk.  ITA Matrix will provide you with lots of comparative data such as the best date to book the flight and the cheapest airport to fly out from. The other big expense when traveling aside from the flight is accommodations.  There are so many better alternatives to hotels, especially for long term stays. Airbnb  rents apartments or homes for way less than a hotel.  You’ll also have more amenities like a full kitchen which allows you to save money by cooking some meals at home. Hostels are cheaper than a hotel and a great way to meet fellow travelers.  You can even house sit and stay for free.  Travis’s friend runs Trusted House Sitters which can show you opportunities all over the world for free accommodations. You can stretch your travel dollars by choosing less expensive regions.  In Western Europe, Spain and Portugal offer greater value than places like Paris or London.  Eastern or Central Europe are about half the price of Western Europe.  South  East Asia will allow you to have a five star experience for a fraction of the price of a lot of places in the world. Packing is always a travel bugaboo.  Travis recommends the Tortuga Travel Back Pack.  Pack what you would need for a week no matter how long your trip.  You can do laundry anywhere. Traveling is something everyone of us deserves to experience.  It changes your life in ways that nothing else can.  Stop thinking it’s an impossible dream.  Travis is flying to Brasil for the World Cup for $5.  Anyone can do it. Show Notes Extra Pack of Peanuts:  Travis’s site where h...

Matt and Andrew bicker like two five-year-olds fighting over a toy about what is the better choice, buying a car or leasing one.  Andrew gets sweary and Matt gets hangry.  Who will prevail? Unlike some of our topics, there is no clear answer to this question.  Should you invest? That one is easy.  Yes you should.  Should you go to college?  That question does not have a black or white answer.  The decision to buy or lease a car is one that will depend on the stability of your current situation and your priorities.  We’ll list some pros and cons of each. Leasing Advantages:  A lower down payment and monthly payment.  Maintenance and repairs will be covered.  You can drive a brand new car every two or three years.  When it comes time for a new car, there is no trade in hassle. Leasing Disadvantages:  You will never own the car.  You have limited mileage, typically 12-15,000 a year.  The contract can be confusing.  If your circumstances change, ie. you get a new job further away or move to a city where having a car is expensive and a hassle, you’re stuck with the lease. Buying Advantages: You can make modifications like a new stereo system.  You can drive as many miles as you like.  Eventually you will have no car payment.  You can sell the car anytime you like. Buying Disadvantages:  Your down payment and monthly payments are higher.  You have to pay for maintenance and repairs outside the life of the warranty.  The trade in process can be a hassle.  A big chunk of your cash is tied up in something that depreciates. These are all things that you will want to consider when deciding to buy or lease.  Or maybe just take Andrew’s advice and buy a bike.  In order to end an argument with no clear answer, I sent Matt and Andrew both to time out.  Andrew had to wash his mouth out with soap and we gave Matt a snack so his hanger would subside. Show Notes Edmunds.com:  A list of pros and cons for buying versus leasing. Allagash Tripel Reserve:  A strong, golden ale. Motherfucking Bike:  You just have to watch.

With the cost of college growing ever more expensive, more and more people are choosing to forego a degree and all of the debt that comes with it. I’ll explain why I didn’t go to college and if I have any regrets over my decision. For a lot of people, college is the natural next step after high school.  Our parents tell us to go; our teachers encourage us to go, all of our friends are going.  Once upon a time, there was no question that college was the path to riches.  But things have changed so does college still make sense? From an economic standpoint, the numbers are still in favor of obtaining a college degree.  People with a bachelor’s degree will earn 84% more over a lifetime than a high school graduate.  A degree will also open more doors.  Some companies will not even look at the resume of someone without a degree, no matter how much experience they may have.  It’s not fair, but it’s what a lot of companies use to screen the huge volume of resumes they receive.  Which college and the grades you got are less important. There are questions to be asked before making the decision though: * What kind of job do you want? * If you want to be a doctor, then the decision is already made. * Do you need to go to the most expensive, prestigious school that accepted you? Maybe you don’t.  The first few semesters will be pre-requisites, so maybe the best choice is to go to a local college part-time, work part-time, and live at home.  If more people took this route, there would be a lot less crushing student debt. College is not for everyone.  For some people, the past thirteen years of school are enough for a while.  There is no rule that you must start college at eighteen.  Maybe work for a bit, save some money and do some traveling.  Just living life can teach you not only what kind of job you want, but perhaps more importantly, what type of job you don’t want. There is plenty of time to decide on college so don’t let anyone rush you.  It’s you who will be on the hook for those loans so make sure the decision is your own. Show Notes iTunes U:  Complete courses from leading universities available for free download. Khan Academy:  A free online educational resource.

What is inflation, what is deflation and what benefits to knowing? We’ll explain the basics and what you need to know to make sure your money keeps pace. Inflation and deflation are terms you hear thrown around a lot but what do they mean and what impact do they have on us? What is Inflation? The value of a dollar is determined by its purchasing power, the amount of things or services which that money can buy. When inflation increases, the purchasing power or our dollar decreases. In the US, our rate of inflation is 3% a year on average. That means the newspaper that costs $1 now will cost $1.03 the following year. Inflation means your dollar doesn’t go as far as it once did. Types of Inflation Demand-Pull Inflation: This is caused when there is an increased demand for something which drives up the price. When demand grows faster than supply, the price goes up. Cost-Push Inflation:If the cost to produce a good increases, a company increases the price to maintain their profit margin. Monetary Inflation: This happens when there is too much money in an economy. Too much of anything makes the value or price go down. The Impact of Inflation Inflation is not always a bad thing across the board. There are winners and losers when inflation happens. If you owe money to a creditor, you win! The cost of your debt is reduced. You really make out if the rate of inflation is higher than the interest rate on your debt. Inflation hurts your savings. A dollar saved now is worth less in the future when you need to spend it. If your raise at work is not more than 3%, it’s not really a raise because it doesn’t preserve the buying power of your dollars. If you are someone who lives on a fixed income that is not adjusted for inflation, your dollar is worth less too. If inflation in one country is higher than that of trading partner countries, the goods of that country are more expensive than imported goods. That can impact domestic producers and in turn, their employees How Inflation is Measured Inflation is measured by a market basket. It’s an imaginary basket of goods whose prices are totaled up. The number is called a price index and the cost of the basket is compared over time. This number is the price index, the cost of the basket today as a percentage of the cost of the same basket in the starting year. There are two price indexes used to measure inflation, consumer price index and producer price index. Consumer price index measures the change in price for consumer goods and services from the consumer’s perspective. Producer price index measures the average change of selling prices over time for companies that make goods and services, so changes in price from the seller’s perspective. Controlling Inflation The Federal Reserve is tasked with controlling inflation. Uncontrolled inflation can cause a recession. If the growth rate of the GDP exceeds 2-3%, demand can drive up prices leading to demand-pull inflation. The Fed slows growth by tightening the money supply, they allow less credit into the market. This makes it more expensive to borrow money which slows growth and demand and brings prices back down. What You Need to Know Year after year, inflation eats into the power of your dollar. You can buy less with that dollar. You have to protect your dollars by investing your money where it earns more than the average rate of inflation, 3%. The average return of the stock market over time is 7% so you’re beating inflation. The average interest rate on a savings or checking account is less than 1%, less than inflation so you are losing money when you have it parked in one of those low yield accounts. When inflation is high, interest rates go up so if you want to buy a house or a car or borrow money to start a business, you’ll pay more in interest. The biggest impact of inflation though is on your retirement savings...

We all fail and we’re all afraid to fail.  Today we’ll discuss why failure is not always the end of the road and may even be the beginning of a new path. No one likes to fail but if that fear is stopping you from trying, it can hold you back in every walk-off life from investing to dating.  Every failure should be mined for lessons.  What could you do differently the next time you try?  Maybe the endeavor you failed it should be scrapped entirely.  There is a difference between quitting and failing. If you start a babysitting business and your town is mostly comprised of retired people, quitting as soon as you realize that is not so much a failure but a reassessment of your situation.  Maybe you decide to start an in-home companion business and now you’re making money. When it comes to investing a lot of people are fearful and not well informed.  Because of this you listen to an “expert” when deciding what to buy without doing any research yourself.  Well, experts get it wrong too and if you lose money, you’ll blame them and decide the stock market is stupid and you’ll just keep your money under the mattress. You can learn from this.  Doing your own research will always be more tailored because you have your own specific circumstances an expert doesn’t have knowledge of. There is more than one way to do nearly anything.  If you need to budget you can use Mint, you can use a spreadsheet, you can use the envelope method.  Just because you failed at one option doesn’t mean nothing will work.  If you burned dinner would you never make dinner again?  No, you would learn that you should not put dinner in the oven and then take a nap. Once you succeed, no one will remember your failures.  Every time you fail, learn a lesson and try again. If it makes you fell any better Einstein probably failed more times then you ever will. Show Notes Betterment:  No hassle investing site. Think Like a Freak:  The new book from the authors of Freakonomics

Barron Cuadro (best name ever) from The Effortless Gent teaches us how to dress well and look great without spending a fortune. A lot of men consider fashion an afterthought.  They throw on a pair of jeans and a t-shirt and they think they’re ready for everything from a date to a funeral.  Or maybe they want to incorporate some style into their lives but don’t know where to start fearing that it costs thousands to look good.  So how can you build a versatile wardrobe without breaking the bank? The most important thing to consider when buying clothes is the fit.  An off the rack t-shirt from Target will look better than one from BOGA if it fits properly.  This is where a good tailor can work magic.  A $20 shirt that you spent $10 to have tailored is a good investment. Barron’s Effortless Gent “Lean Wardrobe” is a great starting point.  It varies a bit depending on occupation, weekend activities, budget, and climate but it will help you build a basic wardrobe of quality, classic pieces.  These include, dark denim jeans, a grey flannel suit, a few button up shirts, a few t-shirts, and top layers like sweaters. Once you are more comfortable, you can add a few well-chosen pieces to expand on the basics.Barron recommends grey or navy for the basic pieces as they are more flattering and less harsh than black for most people, hit men and funeral directors excluded. Shoes are perhaps the hardest thing for a lot of guys to get right.  Barron has narrowed it down to the six you should have.  That might sound like a lot but I have that many pairs of just black heels so believe me, you’re getting off easy with six. Sport coats versus suit coat can be confusing.  A sport coat will be of heavier fabric and perhaps a bolder print.  A sport coat is made to mix and match with other pants.  A suit coat is of finer material and may have a subtle print.  A suit coat is made to be worn with the matching pants. I see a lot of beautifully dressed women out with guys who look like they’re dressed to do their laundry so check out Barron’s site, step up your game and become an Effortless Gent! Show Notes The Effortless Gent: Barron’s site to teach you the basics of building a great wardrobe. Magic Hat Elder Betty:  The perfect summer beer.

How do you stop yourself from burning through all your hard earned money like a drunken sailor on shore leave?  Today we discuss a few mind hacks that can help curb your baser monetary urges. The easiest way to not spend money is to stay home.  No siren song of the bar, no annoying co-workers forcing Girl Scout cookies on you against your will or asking you to sponsor their self-congratulatory charity walk.  Staying inside like Howard Hughes is not really an option for most of us but you probably encounter at least one invitation a week you could say no to. You spend forty hours a week or more with co-workers.  Do you really want to spend more time and your money with them at happy hour?  Turn down those invites that you really aren’t that interested in. It’s hard to say no to spending money unless you have a reason.  Maybe it’s “eff you”  money.  The money that allows you to tell your idiot boss to go to hell when he or she asks you to work the weekend one too many times. Maybe it’s a vacation or the ability to send your kid to college unburdened by student loans.  Put a picture of your goal in your wallet so you are confronted by it before you pull out that credit card. Maybe you discover a new hobby and go nuts buying every accessory for it under the sun.  You don’t need enough gear to outfit a pack of Sherpas because you’ve suddenly discovered camping.  Borrow or even rent the gear to test out the new hobby.  Hundreds of dollars of camping equipment stuffed in the back of the closet with your home brewing accessories and do it yourself taxidermy kit is not a good investment. Our favorite tip is the “Thirty Day List.”  Every time you see something you think you can’t live without, it goes on the list.  If at the end of thirty days, you still want it, then maybe you can honestly justify the expense.  This is even easier if you’re an online shopper.  Put the items in your virtual basket and leave them there for thirty days.  Some online retailers will even send you promo codes for discounts if you don’t check out right away. Taking away decisions will also decrease your spending.  Not spending takes willpower and willpower is finite.  If you are something of a creature of habit, take away some decisions.  Eat the same breakfast every day, develop a “uniform” that takes the decision-making process out of what to wear. When you have to replenish those things, food or clothes, etc, you can find what you need and get in and get out.  This cuts down on temptation. The longer you spend in Whole Foods, the more your will power will be sapped. The final tip is to budget.  If you have $100 to spend on lunches for the month and you reach the limit, you’ll be brown bagging it until the budget re-sets. Show Notes Mint:  LMM’s budgeting for dummies. Magic Hat Elder Betty: A great summer beer.

Travis Pizel from Enemy of Debt tells us how he and his wife accumulated $109,000 of credit card debt through lack of communication and how they paid off the debt and strengthened their relationship in the process. HOW does a couple accumulate that much debt?  Buying Faberge Eggs, eating panda steaks marinated in unicorn tears?  The answer is pretty mundane.  Never budgeting, never tracking spending, vacations, dinners out, and perhaps the biggest problem, never discussing money. Travis and his wife both had good jobs and always figured the next pay raise would put them in a position of eventually having enough money that they couldn’t possibly spend it all.  But that never happened and eventually Travis began to insulate his wife from how bad it had become.  Opening the bills after everyone had gone to bed, shifting balances to newly opened cards, asking for limit increases on existing cards. The watershed moment came when Travis got five identical letters from a company that he had five different cards with.  The minimum payment amount was going to be raised from 1% to 2.5% and there was no way he could meet that.  Together Travis and his wife contacted this debt management company and were put on a plan. The couple sent a monthly payment to the management company who had negotiated lower interest rates with each credit card company.  The monthly payment, including the company’s fee was $2489.  As part of the agreement the family had to close each credit card account and not open any more.  Over 55 months, the entire debt was completely paid off.  The total fee paid to the company was about $2700 but it saved Travis $50,000 in interest.   The debt was being paid but Travis and his wife had to fix the underlying problem that caused the situation.  They now meet twice a week to discuss what needs to be done that week and how they did.  It also required a lot of sacrifice.  No more fancy dinners out, no more vacations, a meal plan so they weren’t just throwing things into the grocery buggy. Now that the debt has been paid and the family is communicating openly, they have never been happier.  Travis and his family realize that if they could make it through this, they can make it through anything. And Travis found a great source of side income.  He is now a freelance writer in addition to his regular job as a software engineer. UPDATE: This is Matt! I mentioned on the show that my brother used a debt consolidation company — that is not true. He corrected me and instead he used a credit score fixing company to improve his credit score. Here’s the link if you’re interested. Show Notes My Personal Finance Journey: One of the blogs Travis writes for.