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By Kevin M
There’s a “stealth expense” that chews through budgets and often leaves us with an empty bank account or even a little deeper in debt each month; its called entertainment expense, and at least part of the problem may lay in the fact that we’re usually reluctant to even view it as an “expense”.
Maybe this is the case because entertainment has a way of defining us—it’s often who we are, which has to be something more significant than just an ordinary expense, doesn’t it?
We can be meticulous about budgeting for housing, groceries, utilities and a host of other expenses, but entertainment is often—to borrow a political phrase—“off budget”.
Continue reading Entertainment For Less →
By Paul Williams
Budget. It’s a four-letter word to many people. We hate the
restriction, the deprivation, and tracking all the little details.
But personal finance experts continue to tell us we need a budget.
Don’t get me wrong. Budgets are very useful tools. I think everyone
should try to use one (or something like it) if they really want to
have control over their finances. But I wonder if we don’t go about
it the wrong way when we try to implement budgets.
For someone who’s never had a budget, the whole process can seem
daunting and mysterious. What’s the right way to budget? Why should
I even do it? How do I track all my expenses? While budgets are
quite simple (a list of income and expenses with goals), there are a
number of questions that can come up for the uninitiated. They find
some answers from people who seem confident and knowledgeable and away
they go. They make up their first budget and set high goals. Maybe
it looks like this:
Continue reading A Better Way to Budget? →
It’s easier when you take care of a few things first
By Kevin M
It’s been said that the best way to accomplish a big project is to break it into a series of smaller ones. Paying off credit cards can be as big a project as we can imagine, based on the size of the debt that needs to be paid off.
Often it’s the size of the debt itself that presents the biggest obstacle to even getting started. While it may not be too difficult to payoff $10,000 in credit card debt going from a standing start, a balance of $50,000 will require marshalling all of our efforts and resources.
It’s important to realize that paying off credit cards isn’t just about discipline. A huge part of the project is emotional and you’ll have to do it in such a way that you’re rewarding your efforts by reaching crucial milestones along the way. Take it in stages, stack the deck in your favor, and the whole process will be less painful.
Continue reading Payoff Your Credit Cards – But Set the Stage FIRST →
By Kevin M
Question: is a car an asset or a liability?
That was a theory question in a sophomore level accounting course I took in college way back when. After some debate among the class, the professor confirmed what we all knew, that the technically correct classification is “asset”, but felt compelled to add, “Of course, in the real world, we all know that automobiles aren’t assets at all, they’re liabilities that cost money and continually drop in value from the moment you drive them off the dealer lot.”
Most of us know this to be true intellectually, but does that reality guide our decisions at buying time?
Cars represent a structural expense, that is, an expense that’s mostly a consequence of an underlying cost structure created at the time of purchase. Once we’ve made the initial purchase, we’re largely stuck with the expense level over a period of years. It’s in our best interest then to make the most intelligent decision at the time of purchase.
With that thought fresh in our minds, I believe used cars are the better choice for most people in most cases.
Continue reading New Car or Used Car – Which is the Better Deal? →
The Economy is Choking on Cost Containment
By Kevin M
The other day, my wife called our prospective health insurance carrier, trying to get our plan initiated. She was greeted by voice mail and immediately placed on hold. Once she did get a live voice, she was placed on hold two more times, only to find that our paperwork was “still tied up” somewhere in oblivion. The first two representatives she spoke with were clueless about our case, the third promised to follow up and get back with us. We’re still waiting.
Here’s a curious point: until this paperwork issue is resolved not only do we have no coverage, but the insurance company has no revenue stream from us.
Stop and let that sink in. You’re a business owner or manager, and your company has problems. Costs are rising and need to be contained. Staffing, perhaps your biggest single expense, needs to be pared in order to improve the bottom line. Technology is brought in to eliminate payroll. Your customer is now “greeted” by voice mail instead of another human being, then routed through a telephone labyrinth of numeric multiple choices in the hope of finding the right person, the one who can help with their problem. Often, as in our situation above, that person is never found.
Question: what is that inconvenient arrangement doing to that other crucial component of your bottom line–your customers and the revenue they bring to your business?
Continue reading Is Voice Mail Killing the Economy? →
IS CONVENIENCE OUR SERVANT OR HAS IT BECOME OUR MASTER?
By Kevin M
For most of the 20th Century convenience was pursued as a means to make life easier and to eliminate undesirable chores from daily life. To the World War II generation, the 1950s brought a surge in time saving devices that were a welcome relief to the difficulty they knew well from earlier in life.
Today’s generations however know little of the hardships faced by that generation. Worse, most of us don’t know life before convenience. In our world today, convenience is a given; the only real issues are how much of it we incorporate into our lives and which specific methods we choose among the many options.
More often than not, we’ll pay extra for convenience—anything that will move us along faster, spare us from handling menial tasks or prevent us from being uncomfortable. Though people have always sought ways to avoid drudgery and make life easier, in our own day and time convenience has become an expectation, a norm, and even a right.
Continue reading The High Cost of Convenience →
By Kevin M
We’re taking on this weekly forum as a way of exchanging ideas to help lower the cost of living. This includes expense reduction and elimination, but goes beyond, even to include lifestyle changes that may bring savings on a number of fronts. Ideas on ways to cut personal, household or business expenses are welcome!
Hopefully, at this point, we’ve all learned that memberships and subscriptions mostly benefit the merchant by keeping us on board as loyal customers, whether or not we actually use what it is we’ve paid for.
If you’re a heavy user of a certain service, a subscription or membership can prove to be a real cost advantage. But never assume you’re saving money just because you’re in the plan. More significantly, if you have several subscriptions and memberships, it’s highly unlikely that you’re getting much benefit from all or even most of them.
Continue reading Eliminate Little Used Subscriptions and Memberships →
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General: Any information in regard to money, credit, personal finance, or in regard to any other monetary topic, provided or shared on OutOfYourRut.com is presented for information and entertainment purposes only and does not constitute financial advice. It is intended to provide general information only and does not constitute personal financial advice in regard to your specific circumstances...MORE-->
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