This is a guest post from Jeff Rose. Jeff’s a Certified Financial Planner and the CEO and founder of Alliance Wealth Management, LLC; he blogs at Good Financial Cents and is working on his first book, Soldier of Finance.

Most people that know me think of me as being physically fit. Part of that is probably due to my military background, and I think the other reason people think of me as being physically fit is because they know I do a crazy workout program called CrossFit.

I’ve dead-lifted 515 pounds and I can back squat 335 pounds. I once did a workout nicknamed “Murph” that consisted of running a mile, completing 100 pull-ups, 200 push-ups, and 300 body-weight squats. In case that wasn’t enough, I followed up that workout with running another mile after that!

One of my friends often jokes and refers to me as “super fit.” A few years ago, we competed in the nine mile Urbanathlon race of Chicago, although prior to that I had never ran more than five miles in my life and only one time – the week prior to the race.

So while most people think of me as being physically fit, in the CrossFit community, I’m just about average. Actually, I just found out recently, that my fitness level compared to others within the CrossFit community is considered below average.

13,423 out of 25,000 male athletes

Each year, CrossFit has what they call their Open Sectionals, which allow CrossFitters from all over the country to compete in a five-week training program.

In this program, everyone does the same workout and we compete to see who can do it either the fastest or with the most weight.

You can go through the results online and see how you place, and if you try to find me in the top few places, you won’t see my name.

Actually, if you get to page 250 of 2500 pages, you still won’t see my name. Even though I’ve been an avid CrossFitter since 2005, there are so many other guys that literally kick my butt!

One of the toughest pills to swallow is when you complete a workout and you’ve given it everything that you’ve got. You give that workout a 110%, yet your score is only 50% of what the top guy did, sometimes less! Sometimes I get frustrated, but then I have to remind myself not to compare myself with others.

Comparing yourself to others can have some pretty horrible consequences, but not just in the CrossFit or fitness community.

Accept yourself, but make changes where it makes sense

As I said in the video above, a lot of people get caught up in comparing themselves to others when it comes to personal finance, too.

Have you heard of “keeping up with the Joneses”? This is a phrase that describes people who attempt to make their house as nice as the neighbors, or who try to buy all the same things that their friends and neighbors are buying. Don’t get caught up comparing yourself to others when it comes to your home, clothes, cars, the latest gadgets, and the latest iPad 3 that they just bought.

You have to make financial decisions based on your own situation, and not as a result of comparing yourself to others.

Just like in the CrossFit open workout, I’m silly to think that I should be close to the top spot. The athletes that are consistently placing in the top spots are training for that – day in and day out. They spend hours upon hours each and every day perfecting their skill, perfecting their craft, and that has put them at the top.

If you have a friend who has job or career that pays them well and allows them to have some of the finer things in life, you cannot get discouraged if your income doesn’t really allow for it.

You have to find a way to be fully content with what you have, at least for the time being.

If you have dreams and aspirations of owning a bigger house or driving something nicer, then invest in the time and invest in yourself first, so that you have the income to support those dreams.

Go back to school and get a different degree or a higher degree. Invest in some type of education program that gives you more knowledge and increases your likelihood to get a raise, or to find a job that will pay you more.

Or, find a side hustle that allows you to work on the side doing something that you love so that you can afford some of the things that you want. Don’t compromise your immediate situation by buying stuff on credit cards now, in an effort to keep up with the Joneses.

I think it’s always important to have a mentor in your life that can give you guidance, but the one thing that has always been helpful for me, especially for the mentors that are much more successful than me, is to realize that it took time, sweat, tears, and blood for these people to get where they are.

They didn’t win the mega-millions and become rich overnight. It took time and effort.

Instead of comparing yourself to others – start by looking at what you want to accomplish, and then find a mentor who can help you reach your own goals – regardless of what everyone else is doing.

*****

Baker’s Note:  Jeff’s an amazing guy to know.  If you loved his post, be sure to check out his personal finance blog at Good Financial Cents. 

*****

So is there an area of your life where you’re busy comparing yourself to someone else, either financially or otherwise?

Are you using that comparison to motivate you, or is it weighing you down?

Let us know!

Note: This is a post from Joan Otto, Man Vs. Debt community manager. Read more about Joan here.

Meet our automotive pride and joy – our fully-paid-for, 111,000-plus-miles, has-even-gone-offroading 2003 Ford Taurus SES.

This car is a beast. And, for the past six years (as of this past Sunday), it’s been put to the test – because it’s been our only vehicle.

In early 2004, I’d bought the Taurus for something like $13,000. When I got it, it was “almost new,” never having been titled and driven only as part of a fleet of cars leased to the dealership’s employees.

That car, by the way, marks THE biggest spur-of-the-moment purchase I’ve ever made; my mom was in the market for a new car, and I’d gone to the dealership with her to help her weigh the options.

She found a sage green 2003 Taurus that she loved… and when I test-drove it too, I realized how awesome it was when compared with the not-yet-paid-for-but-always-broken-down 1996 Dodge Stratus I’d been driving.

So I bought a matching one in red, rolling over my old car note and trading in the Stratus, which was in the running to need a LOT of work. Probably not the world’s sharpest financial decision, but at the time, as a single parent, I really needed and wanted a reliable vehicle.

Fast-forward a little; when we got married in May 2005, Chris had a two-door 1999 Ford Escort. He’d bought it several years earlier, and by the fall of 2005, we’d paid off that car loan and it was ours free and clear. The payments continued on the Taurus, to the tune of $250 a month.

With Sarah still in a booster seat, it was a LOT easier to take “my car” almost everywhere we went as a family. The Escort was used here and there… but not much.

Making the decision

In early 2006, the newspaper where Chris and I both worked full-time relocated its offices… to a half-mile from our home, through two blocks of residential neighborhood.

Suddenly, the infrequently-used Escort became the really infrequently-used Escort. At the same time, we started to get pretty serious about paying off our debt.

And we started asking ourselves: Could we be a one-car family?

We thought about all sorts of factors – positives and negatives. We were “side hustling” even back then, so there were places I, especially, needed to go besides the super-close newspaper office.

On the good side, we hadn’t merged our insurance policies quite yet, so this would help us simplify by dropping Chris’s auto insurance. And, of course, there was the bonus of a one-time influx of cash.

I do have to add one caveat here. My mother lives with us, and she has her car, the green 2003 Taurus I mentioned above. But Mom works and goes out with friends and to church and many other places, so her car is pretty much “busy.”

Very occasionally, I’ll take Mom’s car somewhere, or she’ll take ours, but in reality, we only have crossover when one car is in the shop, and then the three of us draw from the other car.

That said, knowing we had that backup became kind of a security blanket to help make the decision.

We also realized pretty quickly that even if we rented a spare car for the occasional times when we really needed it, that would cost FAR less than the maintenance, insurance and other costs that would come from us keeping Chris’s Escort.

So we sold the Escort for $2,300 on May 6, 2006, after placing an ad on Craigslist as well as in the newspaper classifieds. We asked well below Kelley Blue Book value in order to move quickly, and it paid off: We received dozens of calls, and the first “looker” became our in-cash buyer.

That money quickly went toward debt repayment, and within another year and a half (in the fall of 2007), we were enough ahead of the game to pay off the Taurus almost a year and a half early.

That baby is all ours.

Moving forward, we’ve committed to one big goal: We’ll never have a car payment again. We will drive this sucker into the ground, and whatever we can afford at that time – that’s what we’ll get as a replacement.

If that’s a $500 rustbucket, well, it’s lucky we pay for AAA. If that’s a $10,000 late-model used car, great. But either way, we will not take on a monthly payment for a vehicle.

The good parts

In six years of sharing a car with my husband, we’ve found an awful lot of pluses.

1. No car payments.

We have one car, fully paid off. If we’d kept the Escort, I’m not sure it’d still be drivable, and if we were committed to replacing it, we’d probably still have a payment on its successor.

2. Reduced insurance costs.

Since the Taurus is only titled in my name, Chris doesn’t even much “count” toward the insurance cost. We pay my mom’s car insurance as well, and for the three of us on both Tauruses, we pay $71.14 a month. Before, Chris paid that much alone, and Mom and I paid even more (through our former company!)

3. More consciousness about our driving habits.

You don’t tend to drive like a maniac in your vehicle when it’s the only one you have. (Or, at least, Chris and I don’t.) And since we know that errands aren’t just a “go whenever” proposition, we work harder to plan out our trips and avoid things like running to the store for just a few items.

4. More family time.

This wasn’t something that factored into our decision-making, but it’s turned out to be a great added benefit.

Chris and I spend a good amount of time driving each other places. “I’ll take you to tae kwon do, then go to the library, then pick you back up.” That sort of thing.

That gives us time to talk, and just to be in each other’s space. With two cars, we’d spend a lot of time doing the “you go your way, I’ll go mine” thing.

This goes for Sarah, too; she gets Mom and Dad time instead of being shuttled by just one of us.

5. We walk more often.

When I asked Chris what his thoughts were on why this setup works, his answer was simple: “It helps when you live within walking distance of a lot of places.”

Yes, we could walk with two cars. But we didn’t – and we probably wouldn’t. And the great thing is, we DO NOT live in a “city” by any means. We’re 100% suburbia.

Even so, there are grocery stores, convenience stores, parks, a tennis court, churches, our mechanic, a movie theater, restaurants, banks and more – all within an easy walk of less than a mile.

We’re considering changing banks – because ours is a mile away across a large highway, and we’d rather avoid it.

The less-good parts

Honestly, there aren’t too many things I don’t like about our one-car situation. That said, there are a few down-sides that are worth mentioning. Here’s Exhibit A:

1. I hate my driver’s side door panel.

It hasn’t stayed attached – despite repeated gluing attempts with every adhesive known to humankind – for about the past four years.

If you elbow it hard when you sit down, you’re usually good for about 30 miles, or until you open the door, but then it falls in again.

In the grand scheme of things, this ABSOLUTELY doesn’t matter, but along with the dents/dings/scratches/peeling paint etc., it does make me long for a nice, newish vehicle. (Even if I had to share it – newish would be nice.)

2. Maintenance issues.

This particular car has not been without needs in its first 111,000-some miles.

It’s not good on alternators (yes, plural). It’s soon going to need some transmission work, as you can tell when you try (and sometimes fail) to accelerate from a stop.

The water pump has been replaced. The suspension has been overhauled.

It’s not a money pit yet, but our biggest fear is that we’ll cross the “we shouldn’t put more work into this” bridge before we have the money saved up to buy a decent replacement.

3. Lack of hauling space.

If we had NO cars, and had decided to purchase only one for our family, we’d likely have chosen something with a little more room. The Taurus has pretty good trunk space, but it’s not good for moving even small pieces of furniture and what have you.

We’ve made it work pretty well, but it isn’t always the easiest.

4. Racking up the miles.

When we travel (and we do that a lot), all the miles go on one vehicle.

Now, that’s balanced out by our lack of commute – we average about 11,000 miles a year, which is REALLY low.

That said, we don’t have the option to, say, take the “better” car when we decide to road-trip to Vermont. It’s all Taurus, all the time.

Remember how I said we’ve gone off-roading in it? Yup, really. Dirt and not-even-dirt roads in upstate Pennsylvania are no match for this baby. (And it makes for a fun trip to the mechanic, because he starts off your inspection with the line “I have a really strange question to ask you… has this car recently been on a, well, an unimproved road?”)

So is it for you?

Look, I can definitely say that being a one-car family works for us – and barring any HUGE changes in our circumstances and goals in life, we plan to stay this way and probably even to drive LESS.

In a dream world, we’d keep beating this car up until Sarah, who’s 12 now, turns 17 and gets her permit. By that time, we’d be more than two years out from our final credit-card payment, and if we take even half the money we’re putting on the debt and save it for a vehicle in the interim, we’d be able to afford basically any later-model used vehicle we’d like. (That is, of course, dependent on this car making it five more years.) Then, Sarah could finish driving the Taurus into the ground, hopefully not literally.

We realize it’s not for everyone, though. We have friends who each commute an hour – in opposite directions – five days a week. It would be ridiculous to suggest they could become a one-vehicle family, at least not without a LOT of rearranging.

We’re lucky to live so close to all the places we need to go, especially because our town doesn’t really have a huge public-transit infrastructure. And we’re lucky – though I prefer to say blessed – that I can primarily work from home, which changes our situation drastically.

Finally, the biggest factor in making this work is that we want it to. We go out of our way to make it a success. I’ll ask friends for rides – in exchange for gas money, or in exchange for returning the favor at other times. We’ll rent a car when it makes sense, or rearrange our plans if that isn’t in the cards.

It would be pretty easy to say it “makes sense” for us to have another vehicle, but we don’t want one, and so we’ve built our lives accordingly.

I’m not asking you to sell your vehicle today. Far from it. But for many of us, transportation expenses are some of the highest we have, behind maybe only housing and food.

So I do challenge you to ask yourself this question: Is there anything you can do in the next month to save on transportation expenses? (Or anything you’ve already done?)

We’d love to hear your thoughts in the comments… and if you’re led to becoming a one-car or NO-car family, well, I can tell you from first-hand experience that it’s pretty cool!

Note: This is a guest post from Jen Gresham. A Ph.D. scientist turned writer and entrepreneur, Jen inspires people to find the clarity and courage they need to design a fulfilling career at her blog Everyday Bright. She is also the founder of the No Regrets Career Academy and The Bright Entrepreneur’s Club. Read more about Jen here.

I told myself I couldn’t afford to quit.

On the outside, everything looked normal. I was engaged in my work, did it dutifully, and casually chatted with co-workers in the hallways.

But on the inside, things weren’t right at all. My muscles tensed as soon as I walked in the office. I felt drained before I’d even sat down at my desk.

When my request for a transfer to another division was denied, I became depressed. I’d cry into my husband’s chest at night, saying “I can’t keep doing this.”

It took two miscarriages in the space of 12 months before I got serious about calculating the cost of change.

What’s your unhappiness costing you?

My normal coping strategy for stress is to eat.

But when my job stress became a daily shadow, food wasn’t just an escape, it was my lifeline. It not only got me out of the office, but the pleasure that came with a cup of tea or a toasted bagel smeared with cream cheese was a boost I felt I needed and deserved.

But it’s amazing how quickly these “pick-me-ups” can add up. Take a look at my eating expenses:

• Bagel and tea at local cafe: $4
• Mid-morning snack: $1
• Lunch (out): $10
• Mid-afternoon snack: $1

That doesn’t seem like a lot of money, does it?

But when you multiply it by the number of days worked (roughly 250 days a year), you get $4,000. Of course, you need to subtract the amount you’d pay for eating breakfast at home and packing lunches and snacks. Assuming you can do that for roughly $5/day, the cost of my stress was $2,750 a year.

That’s a fair chunk of change.

But it’s just the tip of the cupcake.

When I took a closer look at where my money was going, it became clear that a lot of my expenses were pick-me-ups in disguise. Most of them were small: clothes, a box of pretty notecards, a nice dinner out, some apps for my phone, new songs, another dinner out.

You see where I’m going with this? I spent about $2,000 a month on these kinds of expenses, hoping they could fill a hole inside me. (Spoiler alert: They can’t.)

What holds many back is the fear that doing what they love will involve a pay cut, and emotionally, they just can’t deal with it.

Notice I said “emotionally.” The inability to take a pay cut often isn’t logical or based on facts.

I’m not saying you should live in complete austerity. But when you add up all the “necessities” that come with an uncomfortable career, it’s easy to get a wacky sense of your salary requirements without even realizing it.

Simply by pursuing work that didn’t require all those pick-me-ups, I discovered I could easily save more than $20K a year. Your number may be more or less than that amount, but most of the clients I work with find they can save much more than they originally suspected.

Exercise 1: Study your bank and credit card statements over several months. Ask yourself, “Did I buy this because I needed it or because I felt I deserved it in exchange for the trials of my job?” Compute your annual unhappiness cost.

What’s your happiness worth?

It cracks me up.

The diamond industry has convinced people that unless you spend the equivalent of one month’s salary on your beloved’s engagement ring, you’re somehow selling the relationship short. And because the ring represents status as much as it does bliss, people go to great lengths to spend as much as possible on that small piece of jewelry.

Don’t even get me started on the cost of the wedding itself.

Assuming someone spends 45 hours a week working and commuting, that means 40% or more of their waking hours are spent at work. Apart from their education, most never invest another dime in creating a career they love.

It’s not that they’re not willing.

Imagine yourself in a unique auction, one that offered the winner work that energized you instead of draining you, that inspired you to fully express your potential. You’d be proud to tell others what you did. You’d feel like you were making a positive impact in a way that mattered to you.

And imagine this work came with a 100% happiness guarantee for one year.

How much would you be willing to pay?

This isn’t a theoretical exercise. See in your mind’s eye the bidding, the flurry of hands, the rising tension in the room. Are you going to let this opportunity slip away?

Exercise 2: Jot down a figure you’d be willing to pay if you knew, for certain, you could buy a job that was deeply fulfilling for at least one year.

Budgeting for (and believing in) a better life

Believe it or not, the easy part is the budgeting.

First, combine the estimated yearly cost of your despair (your answer from Exercise 1) with the amount you’d be willing to pay for one year’s worth of a fulfilling career (your answer from Exercise 2). Subtract that sum from your current income.

This number now represents your minimum annual salary.

A couple of things to keep in mind:

1. Until you know what career or job would actually provide that sense of fulfillment, this number is generally meaningless, other than to reassure you that you need to earn less than you think. Many of us can, in fact, afford a pay cut.
2. Remember, you don’t have to keep your minimum annual salary forever. Presumably you’ll progress faster and make more doing something you’re fully engaged in and passionate about.

You may not be able to afford this minimum salary today. You may have student loans, credit card debts, or an underwater mortgage that require your immediate financial attention.

But don’t use your finances as an excuse for staying in a soul-crushing career forever.

The biggest hurdle between you and your dream job isn’t your bank account.

It’s that you’ve stopped believing in yourself.

When you give the cynic inside you the microphone, everything’s impossible. You gloss over your successes and focus on your failures. You tell yourself they call it work for a reason, then convince yourself your dreams are out of reach.

The voice in your head convinces you that you deserve a donut or a new pair of shoes, but not meaningful work. That’s for someone else. Someone better.

The Dalai Lama said:

It is very wrong for people to feel deeply sad when they lose some money, yet when they waste the precious moments of their lives, they do not have the slightest feeling of repentance.

That’s not a call to be reckless. Absolutely take the time to make your budget. Design a plan to get you there.

But whatever you do, don’t tell yourself it’s OK to waste one more minute of your precious life.

*****

You deserve more than just a paycheck. You deserve a better life.

Now go get it.

Note: This is a post from Joan Otto, Man Vs. Debt community manager. Read more about Joan here.

At one point not too long ago, I had one full-time job and five part-time jobs – at the same time.

When I say we’re serious about paying down almost $90,000 in credit-card debt… I mean it. And that means that when Chris and I can make some extra money, well, we take the chance where we can. When we’re hustling, our family income can be over $13,000 NET in a month.

So when I ask you how could you – YOU – make an extra $200 this week if you had to, I’m probably going to be pretty skeptical if your answer is, “Uh, no way I could do that!”

So just keep that question in the back of your mind… “If you had to make an extra $200 this week, how would you?” We’ll come back to that in a few minutes.

***********

As of last fall, our family’s income situation looked like this:

• My full-time job income from the local newspaper
• My husband’s full-time job income from the local newspaper
• My part-time income from helping Baker with some projects
• Our joint part-time income from buying and reselling used books online via our Amazon store
• My part-time income from working as a Weight Watchers leader
• My part-time income generated as a Mary Kay consultant
• My part-time income from doing some private website setup and design
• Our occasional income from selling our crap on Craigslist, eBay, Amazon and our local “virtual yard sale” email group
• Our occasional income from monetizing our personal blogs using Amazon affiliate links, Google AdSense, etc.

Right now, we’re running a pretty similar setup, with a few changes and some streamlining. Today, I’d like to take a look at how I make all these “side hustles” work – in part, to help continue to introduce you to me and to our situation, but also because I have a sneaking suspicion that there are some applicable lessons out of my experience for anyone who’s trying to generate more income!

I’m using last fall’s list as a reference for two main reasons.

First, this was our longest “list of income streams” ever.  It was notably long enough that it earned me a chance to do an interview as part of the Part-Time Money Podcast with Phil Taylor of PT Money about all my side hustles. (Funny story there: If you listen to it, I talk about working full-time from home at some point in the distant future – turns out it was much nearer in the future than I’d have guessed!)

Second, during the same period, I was participating in the Fall 2011 You Vs. Debt class and as part of that, for 30 days, I was tracking EVERY bit of income and expense in our life. That gives us a lot of data to draw from!

Our three main streams of income

This is actually the part I want to spend the LEAST time on today, but it’s an important background to the rest of the jobs.

In the fall, this was my full-time job income from the local newspaper, my husband’s full-time income from the same source, and my part-time income from helping Baker with some projects.

There are two main things to note here.

First and pretty obviously, my “full-time” and “part-time” jobs have swapped. I now (as you hopefully know!) work full-time with Baker, and I’ve remained an employee of the newspaper in a part-time, from-home capacity.

Second, all of this work is salaried. This is extremely important to note, because if I had to pick one piece of advice to give most people on generating extra income, it would be to take the simplest possible path, which is usually to pick up more hours or jobs doing what you’re already doing.

In our situation, though, especially when our full-time incomes came from both of us working at the paper, we had to look outside the box to make extra money. That was good – because that’s actually what led me to the full-time opportunity here with Baker! At the same time, I’d caution you from getting as varied and complex as we are if you have an existing stream of income that you can grow. Don’t create NEW complexities, new jobs, unless your current ones are maxed out for any reason!

Total income per month (average) from these: $8,000 (more in months with three paychecks at the newspaper, which pays biweekly).

One note here: Assume these figures to be net, but realize that with lots of part-time work comes a lot of tax-time finagling, some of which draws out of this pool of “income”; I won’t get into that in TODAY’S post, but please know I have an accountant who helps me out with all of this and keeps us in good shape with the IRS!

Our biggest side income stream: Our Amazon store

This is another post on its own – how we went from selling our own no-longer-needed books and DVDs on Amazon, to running a full-scale store with a massive inventory – but suffice it to say we average more than 1,100 items listed for sale at any given time, with a stockpile of more than another 300  items that will almost certainly be listed in the coming months.

Total income per month (average) from this: Varies; about $180 a month profit on a “regular” month.

That doesn’t sound like a ton, maybe, especially not when I consider this a “business.” However, we’re just now starting to hit our stride (and monetize on some previously purchased inventory), and there are months in which we top $300 to $400 if a big-ticket book sells. This is basically my husband’s hobby – and, over the course of a year, this “hobby” adds about $3,400 to our family’s income!

We’ll talk more about this concept when I talk about our occasional selling-our-crap income, but here’s a point to remember: Selling used goods online – whether they’re yours or someone else’s – can be pretty profitable!

Joan’s original side-income sources: Weight Watchers and Mary Kay

I talked a little about my job with Weight Watchers in my post about how I think being overweight and in debt have a lot in common. Essentially, since 2006, when I lost 50 pounds on the program, I’ve worked as a part-time meeting leader and receptionist.

The great thing about this job in particular is that you can choose how much you want to work.

Right now, for instance, I’m working only on a fill-in/substitute basis, helping out other staffers when they want time off. At my highest, I led 10 meetings a week across a three-county area (still ON TOP OF a full-time “regular” job). At my highest, I brought in about an extra $250 a week from this work.

Mary Kay is similar; as with any direct-sales business, you can certainly be as active or passive about it as you want. I’ve had months where I was really active, going out and doing facials, etc., holding open houses, what have you, again bringing in $250 to $300 profit in a week. I’ve also had months where my reorder business was the only income.

If you’re going to pursue direct sales – and I’ve heard many arguments both for and against these businesses – I highly recommend choosing a product that meets a need, is used year-round, and is consumable.

In a “down” economy, selling a product that’s completely a “want” can be hard to do, and if you sell something that doesn’t get used up, well, then the sum total result from your efforts will only be that one original sale.

With cosmetics, people are using them – and using them up – pretty much year-round, and that means if you’ve built a solid customer – even if you only ever sell them on one “product” – they’ll use it and keep coming back for more, which is pretty nice.

In both cases, the biggest draw for these income sources actually isn’t the income. The great thing about both of these “jobs” is that they spring from products/services I’d otherwise be spending my own money on.

In Weight Watchers, all Lifetime members at their weight goal can attend for free (so I don’t have to work there to attend at no cost), but staffers also get a 50% product discount, which I enjoy.

Same story with Mary Kay. I’d been using the products anyway, and paying full price to a friend. Now, I get anything I want at 50% off, and my income at a minimum covers the other 50%. That means that at the LEAST, in a month, I’ve saved the money I would spend on cosmetics. At best, there’s profit on top of that!

Total income per month (average) from these two sources: Varies; right now, about $100 a month on a “regular” month; can be over $1,000 a month combined.

Making money by making websites

This is perhaps my favorite “side hustle,” in part because it has been very serendipitous for me at various times.

In short, I design VERY basic blog-based websites for small businesses, churches, nonprofits, etc., then train personnel there on how to maintain and update.

I don’t do hosting and I do only light graphic design and technical support. I’m not working with huge companies with big chains of command. Generally, I do about two to three hours of work once, get a check, and then deal with the client by email as needed here and there (usually less than 15 minutes a month if that, unless a new “project” comes up, for which I then get another check!)

My favorite story about this is that one day, I received a Dropbox file shared to my email account. It was from a gentleman asking his web developer to take a look at his files and make some changes. I replied and said the digital equivalent of “Sorry, wrong number. … I’m not who you need, but by coincidence, I’m a developer and I can certainly take a look if your guy is for some reason unavailable.”

Long story short, that worked out, and I’ve now had several “batches” of work from this company, all of which can generally net me about $200 to $300 for a couple hours of work!

This isn’t the type of work I go seeking – other than my serendipitous email project, most of the sites I deal with are from local businesses that I either patronize or have personal connections to – but it’s something I can grow if I have the time to do extra work.

Total income from this per month: Varies, but can be $300 to $500 on a month where I have one to two projects completed.

Selling our crap for cash

This was something I was into even before I became a rabid Baker fan.

At a few points in my life, I was so broke that selling stuff for cash was how I got groceries.

In more recent – and better – years, getting rid of crap was something that I was doing anyway, often to prepare for a move, and since we tend to keep our stuff in pretty good condition, it seemed logical to at least cursorily try to sell it.

We’re very lucky in our area – our Craigslist is well-used and not full of freaks, and we also have a local email group called the “Yard Sale,” which often will fetch higher prices and more reliable buyers than Craigslist will. If you have such an option available to you, I highly recommend it! (Search Yahoo!’s email groups directory here to see what comes up for your area and phrases like “yard sale”!)

Total income from this per month: Varies widely, but can be $100 to 200+ a month, even more if we’re dealing in larger items like furniture.

Monetizing our personal blogs

Both my husband and I run blogs about our passions – his for old books and paper, mine for homeschooling – that we monetize lightly with Amazon affiliate links and Google AdSense.

We’re not going to get rich doing this. These blogs won’t likely become our full-time income sources any time soon (nor, really, do we want or need them to be). However, it’s pretty great to recoup a little money for something we were doing anyway.

Read that again.

It’s great to recoup a little money for something we were doing anyway.

That’s the key to a significant amount of our extra streams of income. I’m going to a Weight Watchers meeting each week anyway – so why not make some money doing it?

I’m going to buy, and some of my friends are going to buy, cosmetics anyway, so why not make some money doing it?

I’m going to be online anyway – so why not design some websites for a couple hours at night and make some money instead of just playing on Pinterest?

I want to get rid of a bunch of my stuff, so why not see if I can get back some of the cost?

And if we’re going to blog anyway, why not try to bring in an extra $100 or so here and there, which more than offsets our nominal expenses and gives us a little extra as well?!

Total income from monetizing our blogs per month: It’s fairly new, but so far we’re averaging about $80 to $100 a month.

So how could I make an extra $200 this week?

That was my challenge to you at the beginning of this post, and I’m willing to take it myself if you are. These “little hustles” can really add up – and when you’re trying to pay off as much debt as I am, or trying to get cash together to start or grow a business, or to fund an emergency fund… well, it comes in pretty handy.

So if I had to make an extra $200 this week, I’d probably start by selling some crap; I’ve got AT LEAST $100 of stuff sitting here that I had planned to donate (for lack of time right now), but I could take the time to list and sell it and bring in the cash.

The other main thing I could do would be to call some Mary Kay clients and see if any of them are in need of product reorders. That’s a quick and easy way to usually get $50 to $100 in sales. Not something I do terribly often, but I do like to check in and try to provide good service when I can, even though I’m very part-time with my consultancy!

What’s the big picture?

Remember how I said I tracked EVERY dollar spent and EVERY dollar earned for 30 days this fall? Well, here’s what that looked like:

Total money outgoing: $10,228 (included mortgage and debt repayment; some credit cards were paid twice in this 30-day period due to how the days fell)

Total money incoming from the sources above: $13,081 

$5,000 of that income came from sources OTHER than our primary jobs. That’s intense – and it allowed us to make our outgoing number higher, as we paid a significant amount above the minimums toward our debt repayment. It’s not a level of dedication we can pull off every month – but if you’re entrepreneurial, even a “spare-time” business can make you some decent change toward getting your finances where you want them.

By the way, my numbers together added up over those 30 days to us being $2,853 ahead – which allowed us to create our emergency fund and start building a buffer in our checking account of a month’s expenses. (We’re not all the way toward that buffer yet, but we’re getting there!)

So can you make some extra money hustling?

I sure think so! Whether it’s $30 in selling on Amazon or $3,000 from a side business that you’re trying to build into a career, in my book, it’s worth doing.

How could you make some extra money this week – what’s ONE THING you can try?

Let me know in the comments!

Note: This is a post from Joan Otto, Man Vs. Debt community manager. Read more about Joan here.

I’m that lady. The one with the checkbook and the neat lines of transactions marching down each page of its register.

And let’s be honest, nobody still keeps actual checkbooks with matching check registers – do they?

Though my husband and I do try to spend cash as often as possible, every bank transaction – online bill payments, ATM withdrawals, checks and Visa debit purchases – does go right into the register as soon as possible.

That’s right – I still do keep the checkbook in my purse. We don’t write a lot of checks, but we still find keeping the register for ALL transactions well worth it.

Chris, my husband, will usually hold any receipts he has in his wallet, then give them to me about once a week to enter in the checkbook to ensure we are on the same page.

Then, a couple of times each month, usually before I pay a set of bills, I go online and reconcile the checkbook with the bank’s online transaction record, making sure I haven’t missed anything and, most importantly, making sure my number (with any outstanding transactions factored in) matches the bank’s number. To the penny.

Part of this is just my personality – I’m often frightfully organized, and it’d make me itchy not to know how much money we have available.

But also, there was a time in my life in which it mattered – to the cent – how much I had in the checkbook, because if I was off by a couple of dollars, checks would start bouncing.

I don’t like to be real serious most of time; I’m kind of a clown, which you’ll come to know about me, but the thought of bouncing checks was serious stuff.

I remember holding my infant daughter, shopping in Walmart, and putting back jars of baby food at 59 cents apiece because I could get 10 but not 12 of them.

And with a budget that tight, you can bet I kept pretty close tabs on the checkbook. There was even an ATM in the next town where you could withdraw cash in any amount, coins included, and I have a strangely funny but terrible memory of going there and taking out $4.58 (leaving exactly $1 in the account) for gas money.

I guess those habits stick with you, because I’m still just as neurotic disciplined about it.

The funny thing is, I’m really “digital” about most things – except this. I swear I’ve tried every web- or software-based system for accounting for transactions, but I can’t get into them.

A pen, a paper, and little Xs next to the amount when it’s cleared the bank; that’s the simplest way and the way I’ve gone back to time and again.

And even if you’re not as neurotic as I am – almost all of use can benefit from the increased awareness. It doesn’t take nearly as long as you think – and will change your relationship to your spending.

Here are 5 reasons why I think this works for us:

1. We only have ONE account that has any money going out of it, so it’s not super-complicated to keep track of. (Our savings account, with its infrequent transactions, does have its own matching register, but I don’t try to marry the two!)
2. It’s how I first learned to manage money. My mom ran a small business when I was growing up, and when I was homeschooled, one of my jobs was to keep her business ledger. That built up such a habit for me that I find it hard to pick up any other methods.
3. It requires me to be intentional. I love the idea of some of the online money-management systems that keep track of your finances and make sure everything balances out for you. But I don’t love the practice of that – I like to be forced to really LOOK at where the money is going.
4. Along with that, this forces you to see the truth about your finances. I truly credit my banking system with our debt turnaround; even at our worst, I was faithfully keeping track of the money going out … a LOT faster than it was coming in. Hard to ignore the kinds of bank balances that have only a single number before the decimal point, you know? That really motivated me to take action.
5. Finally, it puts Chris and me on the same page financially. I generally keep the checkbook and pay the bills, but the fact that he keeps track of his own receipts and sees the balance means he’s fully aware of what we do – or don’t – have available.

I know, though, that I’m almost certainly the minority in this (even though I think the benefits are universal).

So what works for you?

Do you keep track of your expenditures from your main account at all?

Do you still carry around a “checkbook”?

Leave me a comment below and let me know! I’m super-curious about this. If you can make me feel any less neurotic, bonus points.

Back in February, I caused a little bit of a stir with the following comment on the Facebook page:

If I had a dollar, for every email I got from someone whom DEEPLY REGRETTED buying a house, I would never have to work again. Just rent, people. It’ll be o.k.

I got called everything from pretentious to a genius. And you know what? That’s OK.

If you’ve made a decision about your housing situation, you’re happy with it, AND you have the life you want – then stop reading here. Go on, you.

But if you’re not sure whether to rent or buy… if you’re doing one or the other but are desperately unhappy with your choice… or if you’re in what you think is a good housing situation, but the rest of your financial life isn’t making you happy… then read on.

Here’s the not-so-secret secret: There is no one-size-fits-all answer.

I’ve heard from people – both on that Facebook post and in countless emails – who made home ownership work out well. I’ve heard from just as many who bought their homes but would give anything to be renting. And I’ve heard from plenty of lifelong renters who are thrilled with their choice.

What I can say, though, is that MOST people who decide to buy their homes rush in, lock themselves in, and don’t see alternatives.

Nine times out of ten, housing-related costs are the largest single expense in people’s budget. Yet often, people put more thought into their car or even cell-phone purchases than their housing costs!

I will also tell you this straight up: I’m personally a HUGE fan of renting.

I see far more advantages in the flexibility that comes from renting than I do with buying a single home. (This should be fairly obvious for people who’ve followed the journey a while).

Now, let me add that I’m not anti-home-ownership. I’ve spent a couple years of my life in the real estate industry. Courtney and I have owned an 8-unit apartment building in the past.

I even love the potential of owning a home someday. And most importantly, I understand buying a home is more important for some people than the prospect of flexibility.

But I’m sick and tired of it being the default choice for the “American Dream.” It’s silly that we culturally view this as a must – and that we almost always jump the gun as a result.

First, let’s talk costs here…

I’ll start you off with a (far-from-complete) list of expenses that come up when you’re a homeowner.

• Property Taxes
• Remodeling Projects
• Homeowner’s Insurance
• Regular Misc. Maintenance
• Air Conditioning / Furnace
• Furniture / Home Decor
• Kitchen Appliances
• Outdoor Tools
• Electricity
• Gas
• Lawn Care
• Water Heater
• Water Softener
• Sewage
• Water
• Trash
• Landscaping
• Installation Fees
• Pest Control
• PMI
• Association Fees

Anyone else who has owned property of some sort could probably think back and add a few dozen bullet points to this list (yikes!).

You may or may not incur these costs when you buy (or during the time that follows), but many, many people do. And, once again, as a culture we rarely plan and budget for these expenses.

Do not stop at PITI, which stands for Principal, Interest, Taxes, and Insurance. 

Many people do their calculations based on PITI (even in the real estate and investing industries), without considering much else. This will backfire… big time.

Slow down – and think about everything you are signing up for.

This is life changing. Likely the biggest expense you’ll ever have in your life.

Slow. Down.

What I don’t love – is the myth that owning a home is a *must* or a *smart move*.

I don’t love the MYTH that owning a home is a smart investment.

Real estate can be an investment in some cases – but viewing your personal residence (where your family eats and sleeps) as an investment is a mistake.

Your primary residence should not be viewed as an investment, plain and simple.

The view that owning a home is an investment has led us to a huge bubble that has put millions of Americans in cages made of underwater mortgages. I don’t have to tell many of you this – I’ve heard your stories loud and clear.

One of the most interesting things I learned on our RV tour was the cost of homes across the country. Courtney’s mom bought a four-bedroom, 3000-square-foot home for under $100,000 in Indiana.

In Asheville, you won’t find nearly as many structures under $100,000 (very few). In Burbank, CA, most two-bedroom bungalows (1000 square feet) sell for $500,000.

We are all blanketed with one idea that we should be homeowners, but aren’t given an equal opportunity to do it. Circumstances are incredibly varied (job, location, family situation, freedom, social pressure, etc…) – yet we’ve prescribed one solid path to success for decades now – OWN A HOME, BABY!

This social pressure leads us to incredibly bad mindset for making life-changing decisions like this.

And it leads a tremendous amount of people to a trapped lifestyle (physically and mentally).

So when does it make sense to buy? Here’s your new set of rules:

• If you plan to live in an area 5-10 years minimum.
• If you are debt-free (before the mortgage).
• And if your TOTAL housing costs are less than 25% of your take-home income.
• Big one coming: YOU actually want to buy!

ONLY THEN, consider buying a house among one of your MANY choices for providing shelter for yourself and your family.

If any of those conditions are not met – you shouldn’t be buying a house.

That’s the bare minimum.

These will be considered by many to be “conservative” rules of thumb – but you need to be conservative about locking yourself into a structure. Learn from our nation’s mess!

I’d also say consider the following:

Do you have the skill to do simple home repairs?

(Anything from replacing a piece of gutter to fixing a leaky faucet.) If you have to call a professional for this relatively routine stuff, your costs are going to add up quickly, but if you’re fairly handy, it might be more economical than renting a home with “repair service” built into its costs.

Do you have the TIME to do these repairs and regular maintenance?

(Lawnmowing, mulching, changing furnace filters, etc.) If so, and if you enjoy those tasks, great. If not, renting – or purchasing a home in which these things are handled by an association – might be a better fit.

Do you have unique needs?

For example, if you want to keep 12 pets… if you have 10 children… if you need to be able to create in-law quarters… renting MIGHT not offer you the options necessary. In this case, a property you own might allow you to better manipulate your space.

Again, slow down. It isn’t the end of the world to wait and rent!

*******

When does it makes sense to rent?

Well, like I said, I truly believe almost anyone can benefit from renting. When we talk about freedom – and what that looks like – it becomes really clear that a mortgage is a BIG tie-down.

But here are some situations when it’s especially good to rent.

• If you plan to move in the next five years (or sooner!)
• If you aren’t able to or prefer not to do external and internal home maintenance.
• If you are still paying off your consumer debt.
• If your career or family situation is LIKELY to change drastically in the next year. (Marriage, more kids, kids leaving home, salary change, starting a new business…)
• If you are buying a house because it’s what you are “supposed to do.”

Again, that’s the bare minimum.

But also consider these issues:

Do you dread researching plumbers or electricians and getting quotes?

Forget skimming the yellow pages trying to find a reliable serviceman with the best rates. You have one phone number to call when things go wrong. And they take care of it all. Welcome to renting!

Do you want to experience a neighborhood before you buy?

It’s fun to imagine living in a new place, but it’s also intimidating. How much will I really like it? Will I really be able to work at the cafe during the week? Do I really want to be ten minutes out of town? Do we click with the neighbors? By renting in an area, you can test the water without too much commitment. It’s far better than being two years into a mortgage and regretting where you’ve planted yourself.

Do you want to have a better idea of how much you’ll pay each month in housing?

Rent doesn’t change (well, nearly as much as housing costs). The far majority of expense swings related to housing are the landlord’s responsibility in most situations and areas. Consistency and simplicity allow you to focus your time and stress reserves on more important things in life you want to accomplish.

*******

“I’m wasting that money, when I could be investing it.”

Sigh.

First, do the math (honestly, with all the numbers – for all the expenses). In a lot of situations, this is an ASSUMPTION – and simply not true.

Second, consider opportunity costs of the additional flexibility that comes with renting.

Third, much of your “investment” is going to interest (and in some cases taxes and insurance in the primary payment). If you move in the first few years, you aren’t “investing” in almost anything – especially when you factor in costs of selling and buying.

Once again, I firmly believe your quality of life will increase dramatically when you STOP viewing your primary residence as an investment.

*****

Over the last few years, the perception of whether renting or buying is “smart” or “dumb” or a “waste” has dramatically changed. A huge collapse and a recession can do that for you.

What it comes down to, though, is mindfulness.

Be aware of YOUR situation.

Don’t get sold an “American dream” that turns into a nightmare. It’s happened to millions of people (and many emailers).

Don’t trade your freedom for something that is only that – a THING.

Your home isn’t “you.” It isn’t your family.

It’s a roof over your head, a place to sleep, something totally and utterly replaceable.

Your HOME and your HOUSE aren’t necessarily the same thing.

You can make a HOME out of many situations.

We value the opportunity costs of living a flexible life far too highly to burden ourselves with a huge mortgage and the cost of upkeeping a home.

What about you?

Have you had a fantastic or awful experience with buying or renting?

Have your beliefs about owning a home changed in the last 5 years?

Have at it!

Note: This is a post from Joan Otto, Man Vs. Debt community manager. Read more about Joan here.

Since we started homeschooling our 12-year-old daughter, Sarah, in late February, it’s really been on my mind what a crucial age this is for her in terms of financial awareness.

I see so many of her peers in middle school with $200-a-month cell-phone plans, with outfits that cost more than my weekly grocery budget… but even more scary, I see them having no idea where the money for these things comes from. “I don’t know, my mom buys all that stuff,” is the common answer.

And, by the same token, I see so many kids’ parents working at jobs they hate, coming home and telling their children how much they hate the work they do, that they’re just doing it to pay the bills, and I worry that Sarah will grow up thinking, “Work is somewhere you go to be unhappy.”

I know I’ve certainly been guilty of that in the past, even when doing “work” I mostly enjoyed… talking about it with Sarah as something I have to do instead of describing the way I’m making a difference in the world. If that sounds familiar, well, Baker talked about that concept before in the context of a conversation with his daughter Milli, and that post was the start of a change on my part in how I talked about life and work with my own daughter.

So much about parenting for us can be summed up in two words: Be intentional.

We’re intentional about discussing our own financial situation, and we’re intentional about having Sarah make financial decisions herself.

The picture above is a good example… that’s Sarah with her brand-new Nintendo 3DS, which she spent all her birthday money and a little of her savings on, in addition to “selling some crap” of her own to help fund it. She did the work, figured out how much money she’d need, and made it happen. And we didn’t question her decision (though I was the dorky  mom who said, “OK, but you need to make sure you buy screen protectors!”)

The thing is, I know Sarah puts thought into her life and her money. So instead of wondering what her attitudes about money, work and happiness are, I decided to sit down and ask her.

About work

Me: So what kind of work do you want to do when you get older?

Sarah: Be a pet groomer.

Me: Do you want to work somewhere like Petsmart that does grooming?

Sarah: I want to own my own business. … Well, I guess I would start out working at Petsmart, to save money, because opening your own business costs a lot of money and you have to hire people and give them money as their paychecks. So I guess Petsmart would be my first bet.

About our family’s money decisions

Me: What are some things you think Dad and I think about money? Like, what do we do with our money?

Sarah: That you keep everything in a certain amount of budget. … You’re careful, about what you buy. You don’t, um, buy things that we don’t need. You don’t buy things that you guys want because you don’t need wants, you need needs.

Me: But I bought a Coach purse.

Sarah: Well… that was your Valentine’s present from Daddy.

Me: So do you think that’s OK?

Sarah: Yeah. Now if that wasn’t your present, then you wouldn’t really NEED it, you would want it. And you’d have to save up for it and make sure you have all your needs first.

About living like a grown-up

Me: How much money do you want to make when you get older?

Sarah: I want to try to make a billion dollars.

Me: In your whole life? In a year?

Sarah: In my lifetime.

Me: So what kinds of things do you want to do with your money?

Sarah: I want to give some of it to charity, to raise money for homeless and animals that need it. I want a Mini Cooper, I would use some of it to buy a Mini Cooper. Some of it to buy a Smart car. A pool. A spa. A pool table that can go in your pool. A 52″ flat-screen TV. And a castle. I would buy the castle first.

Me: (Drily) It would be hard to imagine you having all that stuff in an apartment. But what about food and clothes and things like that?

Sarah: I would still buy that stuff. If I need socks, then I will buy socks. If I need shirts, then I will buy shirts. But if I want a cool-looking shirt that has Angry Birds on it, yeah, I like Angry Birds, but that doesn’t mean I will buy it.

Me: So you need a pool table that can go in your pool?

Sarah: It would jazz up my pool. But I don’t really need it. I want it. To put in my pool, because then when I have a pool party, me and my friends can play pool in the pool.

About happiness

Me: So what would make you happy?

Sarah: In what sense?

Me: OK, well, what makes us happy, you, me and Daddy as a family now?

Sarah: A lot of things. Each other… Pets… Being together as a family.

Me: So is that the same stuff that will make you happy in your castle when you’re older?

Sarah: Being with family, hanging out, having pets and a fat robin on our deck (she was looking out the window.)

Me: So are you going to have a big family?

Sarah: I’m going to have Coby (our dog), our cats, a hamster, a guinea pig (well, I don’t know about a guinea pig, that’s a question mark). 4 Hermit crabs. A German shepherd.

Me: What about people?

Sarah: Oh, don’t worry, there are people in my house. Me. I guess my husband.

Me: So what will your husband do, in all of this?

Sarah: Well, his job will be “the animal sitter.”

Me: So is he going to go off to a job somewhere, or stay at the house?

Sarah: The house. I mean, I’ll help some, but… I don’t know if I’m really going to have that many pets. That’s just an idea.

Me: Are you going to have kids?

Sarah: I don’t know. That’s ahead of the time.

Me: OK. You have to get the husband first?

Sarah: Eventually. Not right now.

(That’s Sarah with one of our cats, Mitts. While I have my doubts that this cat in particular will make it to the time when Sarah lives on her own, I’m positive she’s not kidding – she’ll be the lady with every kind of pet under the sun!)

About finding your business niche

Me: Well that’s good. So do you think a pet groomer makes enough money for all this?

Sarah: Well… yeah. Because my own dog will be there with me every day. I would groom him before the store opens, and because of that, I would let him go greet the people, let them feel his coat, because I’d be using the Furminator, using the smooth brushes, bathing him probably… I’ll need some more people to do that too, maybe. And then they’ll get to see how good of a job I’ll do on their dogs, so they don’t think, “I wonder what she’ll do on my dog and what it’ll look like. It won’t look ugly.” And I’ll be like, “Don’t worry, your dog won’t look ugly, I’ll make it look exactly like you want and I’ll try my best.”

Me: So that’s kind of your business, like, your business’s gimmick? Having your own dog there?

Sarah: Yeah.

Me: So what would your commercial be?

Sarah: If you want your dog to look better than the old-fashioned way, then come to Sarah’s pet grooming. I’ll get the job done and make your dog look new-fashioned.

Me: And smell better too?

Sarah: Of course!

About “good money advice”

Me: So if you could give the people reading Baker’s blog any piece of money advice, do you have any ideas for them?

Sarah: Yeah, I have a good idea! Don’t buy what you want, buy what you need and save your money!

Me: So when is it OK to buy the stuff you want?

Sarah: Well, never. No, sometimes. For your birthday.

Me: Well, we don’t just buy stuff we need only. We have some wants too, right? When do you get the stuff you want?

Sarah: As long as you keep a limit of how much you want to buy. If you just keep buying and buying stuff that you want, and then you run out of money for stuff that you need, then you’re stuffed in a doom trap!

About credit cards

Me: And if the man at college says, “Hey Sarah, do you want to open a credit card?”

Sarah: No, because that would be something that I might want to do, but that I don’t need to do.

Me: Because do you know how credit cards work? (I admit, I was interested in this – Sarah doesn’t remember a time when we’ve made purchases on credit cards as a family, so I wasn’t sure what she’d say.)

Sarah: You swipe them and it takes money out of your account.

Me: Well, that’s our bank card, it works like that.

Sarah: Grocery cards give you extra bonus points.

Me: Yes, those are good too. But real credit cards, you don’t have to have money in an account somewhere. It’s like when we went to Target when you saved up the money to buy your 3DS. You spent $300, right? But what if you only had $5? The people at Target would say, “Do you want to open our credit card?” Then they would basically loan you the money, let you buy something that cost $300 now, then send you a bill.

Sarah: And then you pay it?

Me: Well, you can. Or you can pay a part of it, then they will charge you interest on what’s left and next month you will still owe what you owe, plus the interest.

Sarah: That kind of makes sense, but I don’t know if I’d want to do that.

My mom, chiming in: GOOD. Because then you end up paying twice as much as it costs.

Sarah: Yeah, then I don’t want to do that.

About entrepreneurship

Me: Anything else you can think of about what you think about money and being happy and working and stuff?

Sarah: Being happy motivates you to have a good attitude, and to focus on what you’re doing. And if you get unhappy, change your mood around to happy. Because when you get unhappy, not all people, but a lot of people want to go out and buy things because they think that would make them happy. … And use your money wisely.

Me: I think that sounds like pretty good advice. You’re pretty smart.

Sarah: Thank you, thank you very much. (In her best Elvis voice.)

Me: Thank you very much for doing an interview with me for Baker’s blog!

Sarah: Thanks! Do I get a dollar?

Me: Um, wait, what? Why do you want a dollar?

Sarah: Well, because I sat here and helped you, and I could’ve said, “No, I don’t want to help you with your blog post.” I did do all this work with you. Please? I said the magic word?

Guess what? I gave her the dollar.

All in all, I was pretty pleasantly surprised. Maybe it was the birth of Baker and Courtney’s second daughter, Charlie, this weekend, but it’s been on my mind a lot this week to think about the financial legacy I’m leaving behind – not just in terms of money, but with regard to ideas.

If I had to pick my top five things to impart on my daughter about money and life, they would probably go something like this:

1. Do work that you love and that helps others.
2. Treat yourself sometimes, but don’t buy everything you want just because you want it.
3. Make sure your family’s basic needs are taken care of first.
4. Don’t spend money you don’t have.
5. Experiences and people are more important than things.

Sounds like she’s pretty close, huh?

I know there’s a lot more life ahead of her, and I know she’ll make her own decisions about all these things as her life changes. But I’d like to think we’re off to a better start than we might be!

So how do you deal with this idea of your “financial legacy” with your kids, especially as they get older? What sorts of ideas about money, “work” and happiness do you hope they’ll take into the future with them?

Would love to hear your thoughts!

Early this week, I received an email question from a passionate reader.

I’ve changed a tiny bit of the details to protect the guilty, but the question went like:

Hi Baker!

I forgot to ask you a question about money vs time. I hope you don’t mind that I ask you here: I have a bunch of crap- loads of it. But at this point I’m thinking it’s not the best use of my time trying to sell it all.

I’ve got 3 kids (7, 5, and 21 mos) and Im thinking it best to donate most of it except for a few items that are clearly worth over a hundred dollars. And spending the time instead creating and writing my blog.

Would you agree with this decision or would you still recommend the selling process?

Much appreciation,

-Really sweet lady that Baker hasn’t asked permission, so he won’t share her name here.

I love questions like these, because they are simple, straight-forward and easy for me to provide help!

Here was my response edited for the blog:

Hey (secret woman) thanks for emailing and all your kind words!

I tackle this problem a lot – but only from people who are really honest with themselves (like you).

I always give the following advice:

The single most important thing is ridding that crap from your life.

A.k.a. getting it out of your life will reclaim so much time, stress, and energy that throwing it into a bonfire would be beneficial to you.

Now, obviously we don’t want to do that! So donating the far majority of small stuff is usually worth it for busy people and entrepreneurs.

One other idea is to host a mega yard sale – it’s coming up on Spring – you likely wouldn’t need too much planning and could devote one weekend to dumping a ton of it a micro-prices. Essentially mark everything to move quickly. Then on Sunday bring a truck and donate anything that’s left.

We’ve found these weekend projects can be fun family bonding moments, can generate a least a little bit towards the blogging or travel fund and can save you a trip or two to Goodwill, etc…

If it were me, I’d donate it. My wife would likely coordinate a mega-yard sale and then donate.

Do go for listing the “low-hanging fruit” or the larger items you know will sell for a decent amount of money on Craigslist or eBay.

But if you try to individual list every single item you sound like you’ll be far less likely to actually succeed at the most important step – getting rid of it for good!

Hope this helps… please take pictures if you go the bonfire route!

-Baker

Haha!

Obviously, I’m being cheeky when talking about the bonfire. But I’m not being cheeky about the end result.

Nothing is more important than parting ways with the crap that bogs down your life.

In other words, it’s easy to get sidetracked.

It’s easy to get attached to the “value” that you put into something years ago (or even weeks ago) and thus let it keep you from ditching the physical clutter that plagues you.

Don’t let anything stop you!

In Sell Your Crap I have a full walkthrough with recommendations of where to sell what item (based on its value, size, shape, type, etc…). We also provide a full list of where to donate specific types of items (to avoid bonfires).

I don’t have the space to break that all down here, but we always start that process by setting a “floor” or minimum value that we will invest time in selling. For some people, the floor may be $5. Anything worth at least $5 they will sell.

For other people, the floor may be $100. Anything less than that and they are donating – above that they will work on selling.

You set this amount in your own life.

The lady who emailed me was in the middle of radically changing her life and her business – and thus her floor in this case was higher than it may have been even months before.

Bottom Line: Your excess crap steals your time and energy – and adds stress to your life. Sure, get money from it if you can. But let nothing stop you from your commitment to reclaim your freedom.

In case you were wondering… here’s her response:

You’re so awesome! I just may have a bonfire, but don’t worry — I will not link you to the cause

So glad you confirmed what I thought about this — for *me* it’s just not worth the hassle of a yard sale. Time would be much better spent towards creating our new life!

The crap is good as gone!

Perfect!

You can see the passion and the excitement in her emails. And I have no doubt that purging the crap from their life will only add to the momentum!

It’s springtime, folks.

Look around and identify the layer of crap in your life.

Time to have some bonfires!

(figuratively… or literally… your choice…)

In Episode 4 of the Man Vs. Debt Podcast, we cover how you can “Rally Your Friends and Loved Ones.”

We’ve talked about this here on the blog before, as it’s one of the single biggest issues that holds people back.

Note: We also cover this content on the final day of Week 1 in You Vs. Debt. Registration for our new Kickoff 2012 class closes soon, so don’t delay! The class starts together on Monday!

What We Can Learn From The News:

At the beginning of each podcast, I cover three news stories from the past week. We attempt to have a little fun and pull out a positive nugget from each story featured.

• Story #1: Wikipedia Blackout a Grand Gesture or Grandstanding?
• Story #2: What Would You Do With A Billion Dollar Bank Error?
• Story #3: Heroes of the Concordia Crash

Why having your friends and family on board is important:

1. It’s been the #1 factor of any positive change in my life.
2. Realizing that “the meaning of any communication is the response it elicits.”

1. Realize you can’t change them.
2. Let them change organically.
3. Start with WHY it’s important to you.
4. Seek their input. Listen.
5. Leverage outside influences.
6. Lead by example.
7. Make it a routine.

How you can help the podcast explode:

Our first three episode have been downloaded or streamed over 25,000 times!  Whoo-hoo!

If you’ve listen and enjoyed any of the podcasts so far, would you consider leaving a quick, passionate review in iTunes?

Click here to view and/or subscribe inside of  iTunes!

(The newest episode may take a few hours to show in iTunes, but it WILL download if you subscribe.)

Thanks again for everything!

Xoxoxo,

-Baker

“What the hell are you doing, son?”

The words sounded muffled in my head. I sat frozen – gripping the steering wheel on the side of the dark, empty interstate.

“Shut your engine off, get your license, and put your hands back where I can see them.”

I did as I was told, silently.

Upon glancing at my license, the office immediately glanced up and locked eyes with me.

Starting at the beginning, I told him everything…

Story #1: The $10,000 Wake Up Call…

I was addicted to gambling.

Now, this was before getting back together with Courtney (before we were married) and far before Milligan was even a thought. We have to go back to the period between me failing out of college – and getting my life back on track.

At this time in my life, you’d be hard-pressed to find me awake and not sitting around a card table or in a poker room.

We lived and breathed it. We played most of the day – and when we weren’t playing, we were organizing tournaments and cash games (or dealing them for addicts).

During one six-month period, I worked one day each week (a 20-hour shift) dealing one of the largest cash games in Indianapolis. I made around $60/hour in tips and would take home anywhere from $1,000 to $1,500 in one sitting.

I did this every Monday night – and spent the other 6 days playing video games and online poker with my two roommates (neither of whom had their own job).

This was the most “stable” I had been in years.

*****

A few months later, I found myself pulled over on the side of the interstate – convinced I was about to be violently arrested.

I had just passed a police car going 130 m.p.h. at 3 a.m.

You see, I had just worked the entire day, taken my overpaid cash wages, and sat down at the poker table. A couple hundred dollars quickly became a thousand, then $3,000, then $10,000.

At 21 years old, I wasn’t content with $10,000 for two hours of work. It wasn’t real money to me. I wasn’t content unless I had every chip at the table. I wasn’t content until I sent every degenerate at the table home to their mortgages they could no longer pay.

Over the next 90 minutes, I lost the $10,000 as quickly as I had amassed it.

I don’t remember leaving the poker room or getting in my car.

*****

“What the hell are you doing, son?” The officer’s words echoed in my head.

Upon glancing at my license, the officer immediately glanced back up and locked eyes with me.

“Adam *Baker*… you wouldn’t happen to be ______’s son, would you?”

I swallowed. “Yes sir, ______ is my father.”

“Adam, what the hell are you thinking?”

He listened to all of it, before giving me a breathalyzer (I hadn’t been drinking).

The next thing surprised me the most… He let me go.

No arrest, no ticket, not even an official warning (although he had plenty of words for me).

At one of my darkest and most irresponsible times, I was pulled over by the only state police officer in Indiana that had grown up with my father.

Coincidence? I’ll let you decide what to call it.

On the rest of the drive home – moving a good 15 m.p.h. under the speed limit – I fought back tears as I vowed to finally change the direction of my life.

Story #2: Trapped in the Most Beautiful Place on Earth…

Flash forward five years.

“Get Milli and crawl slowly out of the car…”

I should’ve been scared, but for some reason I wasn’t. Even so, I wasn’t about to move.

Through the passenger door, I saw the waterfalls that were streaming down the mountain side and I took in the bluest sky I had ever seen.

As I turned to my left, gravity pulled my head toward a mangled mess of tree branches.

I squinted to make out what was beyond the branches.

… nothing …

Only a few trees stood between me and two hundred feet down the side of the mountain.

As I snapped back to reality, Courtney was twisting her body to unstrap a dazed Milligan from her car seat. She was fighting gravity to try and lift the rear passenger door and climb out.

I didn’t dare move.

*****

We had come to New Zealand 8 months earlier on a last-second decision from Brisbane, Australia. We had spent the last few months living in Auckland as Courtney taught a few semesters at a local elementary school.

It was one of the most freeing times of our life.

We had spent the last two years transforming our financial life. We had paid off $18,000 in consumer debt, sold all of our possessions, and set off to backpack Australia.

Somehow our journey had now brought us to the side of this mountain outside of Milford Sound on the South Island of New Zealand.

I didn’t dare move…

*****

After what seemed like the longest minutes of my life, I let out a sigh of relief as I saw Courtney and Milli climb out of sight to where we had slid off the road.

“I guess it’s my turn,” I thought.

I moved as slow as I could given the awkward angle. The car was nearly on its side.

As I stretched to try and force the passenger door open, I thought for sure the trees would snap under my shifting weight.

Luckily, they didn’t budge. Not a single inch.

As weak as they looked, the trees grouped together to form a safety net that had kept us from sliding down the mountainside.

Up on the road, we pulled out our cell phones and confirmed our suspicions – absolutely zero bars. We were 90 minutes from the nearest town on a road that is sparingly traveled that early in the morning.

We had no choice but to sit on the side of the road and wait.

Irony hit us hard as we soaked in the visualization of being trapped in the most beautiful place on earth.

*****

48 hours later, I found myself talking to an old man that owned the closest tow-truck company.

An Israeli family had found us stranded on the road – and had taken us to the only lodge within two hours of the sound. I rode in the back with their groceries. Milli rode on Courtney’s lap.

The lodge was booked solid for months, so after 18 hours of discussion (to make a long story short) we finally shared a single bunk bed with the employees of the lodge for a few hours of sleep.

I had spent hours on the phone over the last two days, trying to coordinate police, rental companies, and tow-truck drivers from a city 90 minutes away from the accident site.

*****

“Well, this isn’t going to be pretty…”

The seasoned tow-truck driver almost felt sorry for me through the dollar signs in his eyes.

He poetically laid out all the expenses he had incurred in retrieving the car.

Earlier it had been carefully explained to me that since I took responsibility for the accident that we’d have to cover the tow-truck charges ourselves (though the rental company would cover the damage to the vehicle).

“Yeah, I was there”…  I mumbled back to the tow truck driver.

I remembered waiting several hours for the driver to wind his way through the mountains.

I remembered the driver and I blocking the road for 45 minutes as we tried to figure out a way to rip the car out of the trees it had nestled in.

I remembered the gas, the after-hours calls, the size of the truck that was needed to do the job.

I knew all along the price tag of this operation would sting.

We ended up negotiating it to around $800 New Zealand, which was around $600 in U.S. dollars.

Keep in mind we were camping in a broken tent to save money at this point in our road tour. An $800 tow charge at this time was extremely demoralizing after all our frugal hard work.

But here’s the difference between the two stories…

We paid the tow-truck driver in cash.

There was no negative thought, no added stress, and not an ounce of worry.

As shitty as that 48-hour moment in time was… I was proud.

It was the first time in our life we had a fully-funded $5,000 emergency fund, and the first time we had to use it.

In the first story, money controlled me. It controlled my actions, my emotions and my relationships.

In the second story, we controlled our money. It didn’t dictate our actions in this emergency. It didn’t change much of our emotions at all.

As I handed the old man $800 in cash… I was proud.

How much worse would this situation had been without an emergency fund?

How much extra stress, arguing, and worry would have come with it?

I lived my life for years like that, and I don’t even want to think about it.

So we did the only thing there was left to do.

We buckled back into our mangled rental car (with deep gashes running down the left side and no front bumper) and finished our driving tour of the South Island of New Zealand.

We weren’t going to let sliding down the mountain keep us from finishing what we started.

*****

Taking back control of your financial life doesn’t prevent this kind of stuff from happening.

It doesn’t keep you from getting into situations where you are trapped.

But when shit does hit the fan, having a flexible financial life makes all the difference in the world.

Trust us, we know.

The goal isn’t to make it through life without any scars…

The goal is to empower yourself to break free, heal, and bounce back quickly.

The goal is flexibility.

The goal is freedom.

*****

Note: Up until now, I’ve only shared these two stories with our You Vs. Debt students. Several of those students pushed me to share them publicly… thanks to them for the nudge. The next You Vs. Debt class starts next week (January 23rd). More info soon!

*****