October 2007

Here are a few things to laugh and cry about on the occasion of Blog Action Day. I just went a little off-track to save you from the monotony of reading some serious stuff on this matter on about 15,000 other blogs.

According to unreliable sources, George W. Bush has also taken notice of this event and has prepared the following special address for Americans who still pretend to be unaware about the issue:

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Now, let’s take a quick look at some numbers:

Oil Consumption

[bbl/day = barrels per day; source: Nationmaster ]

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CO₂ Emissions

[thousand metric tonnes of carbon dioxide; same source as above]

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Take a moment to absorb that information and try relating it to your daily habits. Then, if some inner voice encourages you to play your part in helping the environment, here are a few things you can try.

For people who didn’t like the video above, here is an excellent overview of the concept of global warming in simple words.

A shout-out for some interesting articles published over the week.

• Am I Rich? by Jenn @ Frugal Upstate.
• Separate Checking Accounts, or Keep Them Joint? by MBH @ Mighty Bargain Hunter.
• Quality of Life is More Important Than Dollars by Patrick @ Cash Money Life.
• Mean Things Retailers Do That Piss Me Off by Nick @ Punny Money.
• Can Losing Your Job Mean Finding Happiness? by Ben @ Money Smart Life.
• Looking Back on My Debt @ Advanced Personal Finance.
• Making Sense of Tax Efficient Money Funds by Nickel @ Five Cent Nickel.
• Use the Right Benchmark to Accurately Measure Investment Performance by Jeremy @ Generation X Finance.
• Online Savings and Interest Checking Accounts: Where are the Good Deals? by Sun @ The Sun’s Financial Diary.
• 7 Personal Finance Lessons from the Poker Table by Jim @ Blueprint for Financial Prosperity.
• Yesterday I Resigned. Will I Ever “Work” Again? by Lazy @ Lazy Man and Money.
• Below the Line Tax Deductions by FMF @ Free Money Finance.
• Give Yourself A (Pretend) Pay Cut by NCN @ No Credit Needed.

I have been posting a bit slow over the past two weeks while I continue sulking over some recent unpleasant events. I do have a lot to write, but I am afraid it will sound a bit too negative for my own taste - and that’s not going to be of much help to anyone. So, I will probably be light on posting till my mood lightens up a bit. A few more days… perhaps. Feeling the positive vibes already.

Meanwhile, you can go ahead and entertain yourself with some popular posts from the past month.

• Stop Going Crazy With Birthday Parties For Kids

• Where Exactly Is The “Pressure” To Spend?

• A Quick Financial Awareness Wake-up Call

• Who Is Responsible For Lead In Toys?

• Jobs That Pay Badly And People Who Choose Them

• A Pay Cut, A Raise, And An Incredible Coincidence

• Vehicles Of Financial Frauds: Phishing, Vishing, And Other Social Engineering Methods

• Got Financial Fantasies?

Notice the plastic cover on our laptop:

The laptop looks absolutely brand new under that shoddy plastic cover (which came with the original packing) and which is now old enough to warp itself out after more than a year of use - although, I am still not inclined to remove it completely.

In the past, I have done something similar with plastic covers on many other consumer products - digital cameras, watches, calculators, scientific instruments in my lab, etc.

I don’t know what the motivation is - it’s some sort of a default “frugal” behavior on my part. Maybe it’s the idea that the product will appear “like new” even after a prolonged use - sort of a “save it for later” spirit. Maybe subconsciously, somewhere in my mind I have tied the value of the product to it’s appearance. Maybe keeping the covers on really extends the life of certain delicate products. Maybe it’s just a silly habit. Whatever.

I call it “default” behavior, because it’s not really a deliberate motivation - for example, in case of the laptop, the thought of removing the cover never crossed my mind till yesterday.

Anyways, this brings up a very interesting general issue - till what point should you “save it for later”? I mean, yeah.. you can keep the plastic cover on your brand new sofa forever and preserve it’s original value well over the years, but then you may never really experience the consumerist pleasure of the *newness* of the object (isn’t that one of the reasons why people buy “new” stuff?) - not to mention the irritating crackling noise of the plastic cover.

I wonder if I have been applying this line of thought in other walks of life, without really being aware of it.

Some interesting stuff that got published while I was sulking away:

• Should Men And Women Receive Different Personal Finance Advice? by Trent @ The Simple Dollar.
  

• Save Money By Living in a Mall Parking Garage for Four Years by Nick @ Punny Money.

• 27 Ways To Save Money On Food by Brett @ Frugal Law Student.

• Can Cheaper Goods And Lower Prices Put Us At Risk? A Photo Essay by SVB @ The Digerati Life.

• Frugal Ways To Get In Shape by Kyle @ Rather Be Shopping.

• Repair. Reuse. Save! by Dawn @ Frugal for Life.

• Redbox Test One: Success! @ Clever Dude.

• CFL Bulbs Can Save You Money, But There is Something Else You Should Know by Tricia @ Blogging Away Debt. Here is some more information on the subject.

The olive oil issue returns! but this time, somebody else wants to talk about it. This post is authored by Paid Twice who writes over at I’ve Paid For This Twice Already. If you are looking for bloggers in debt, who are fighting it out and inspiring others to do the same, you should stop by her blog sometime. And yeah… forget nasty comments or be ready to get a taste of some serious kicking skills.

I have to admit, when I read the post here a few months ago about buying canola oil and a couple acting superior because they use olive oil, I was taken completely aback. Not that I would ever have some kind of attitude with someone because I use(d) olive oil, but honestly, I never knew that canola oil was as good or even better to use for cooking as olive oil . The whole post, and the ensuing comments, completely surprised me. Basically I had been buying olive oil, extra virgin olive oil no less, for years and years, thinking I was doing something good for my family (and spending a huge premium to do it) when in fact, I could have spent way less than half as much, bought canola oil, and been just as healthy.

Apparently I have been brainwashed by the likes of Rachael Ray and the majority of the Food Network into believing that extra virgin olive oil is *the* thing to use for cooking. I do not generally subscribe to the idea that expensive = better, but sometimes, it actually does equate , and I thought for some reason this was one of those instances. Now yes, I could have researched it, I could have done my own reading, I could have done many oil comparisons and figured this conclusion out for myself this. If I’d even known what to compare. I’d never really given much thought to anything other than “vegetable” oil (which in my experience generally means soybean oil) and olive oil as possible options in my oil usage.

Olive oil is just one example of a growing problem I have when trying to be frugal vs being cheap. Sometimes I feel like the world is designed to throw barriers in the way of being truly frugal at every corner. I always hear the idea of spending money for quality espoused as a frugal concept, but it is so hard for me to figure out what quality is or when quality is worth it.

I want to live a frugal lifestyle. Frugal. Not cheap. I don’t want to sacrifice the health of my family or their safety to save a buck, and I don’t want to buy the same thing ten times for a dollar each I could have bought once for five dollars. It is easy to say save money when it doesn’t matter, but spend money when it does - but for me, so hard to put into practice. I’ve overspent on things I thought were cost-justified but actually were not (see my years of olive oil usage), and I’ve underspent on other things just to be disgusted with the quality and end up with a broken something that had to be replaced (a shelving unit and a laundry hamper both immediately come to mind).

So does every single purchase, no matter how mundane, need hours of thorough research? Whose research do I trust? Where do I look for that kind of information and when do I know that the frugal thing to do is spend more money vs buying cheaply? I don’t know if there is a simple answer to that. So much of life is full of propaganda and supposed experts telling me what to spend money on and where. How do I filter out the propaganda and figure out where the real information is? More and more I’m running into this problem, with food and also beyond.

And to finish with another question about food, those of you who are in the know about oil…. what kind of oil should I be using for baking?

Here is a link to Paid Twice’s feed if you would like to have her blog in your feed reader.

Let me start this link fest with a congratulatory note to Super Saver @ My Wealth Builder - a long time reader of this blog and a fellow blogger who managed to achieve the mythical “retire in your forties” dream. Here are a few posts from him that are overflowing with the joy of the ultimate freedom.

• Achieving Financial Freedom - I’ve Retired In My Forties

• Today is The First Day of The Rest of Life

Pretty inspiring.

Bookmark this dude and follow him as he discusses how he did it.

Here are the rest of the links for this edition of the review:

• How Spending Money Can Actually Save You Money by Ben @ Money Smart Life.

• How Much Passive Income Can You Buy With… by Lazy @ Lazy Man and Money.

• What Can We Learn from Yale Endowment’s 28% Annual Return? by Sun @ The Sun’s Financial Diary.

• Stop Worrying About How You Got Into Debt and Start Focusing On How To Get Out by Paid Twice (guest blogger) @ The Digerati Life.

• Stupid Woman Sues Over Apple’s iPhone Price Cut by Jeremy @ Generation X Finance.

• What To Do During A Recession by Jim @ Blueprint for Financial Prosperity.

• Ten Tips for Dealing With a Lost Wallet by Nickel @ Five Cent Nickel.

• Why is Adoption So Expensive? by Laura (guest blogger) @ Free Money Finance.

• The Emergency Fund by NCN @ No Credit Needed.

Since Monday evening, this week has been horrible for me in terms of how much crap life can hand over to someone in such a short amount of time. I don’t know how people tend to look at stuff, but right now, to me, it seems that getting your dreams crushed is far more depressing than any amount of financial loss. I am ready to give every penny I have to get back what I lost - but it doesn’t look like that’s going to happen.

Anyways, without making this a morose platitude, let me come to the point. Here are a few parallels that I have been drawing between life and stock markets - almost in a way as to comfort myself in this chaos.

• In general, there are these daily ups and downs, there are these rare black days, and there are these occasional fears of recession; but on the whole, the hope is that things will tend upwards in the long term. So, it helps to not look at the daily volatilities and to focus on a 20~30 year perspective. For me, it has been nothing short of a melt-down for the last couple of days - but I am going to stick to my “hold” strategy (I am talking about life), think long term, and hope for better times ahead.

  

• In life and in stock markets, smart decisions can help accentuate success and mitigate failure, but there are days of profound realization when the randomness becomes quite apparent and success becomes a game of probability. Makes us acknowledge a multitude of factors, beyond our control, that can affect future outcomes.
• At times, we regret our past choices - “I wish I had that winning one” OR “I wish I didn’t have this losing one” - but no amount of regret can reverse what has already been done. The only thing you can do is to take it easy and think in terms of the future prospects.
• Just like people start wondering whether their portfolio is balanced enough for their long term goals - right when the market hits the bottom - the last few days have made me contemplate on some balancing aspects of my life’s portfolio - why am I doing what am I doing and how am I doing it. Although I understand that, just like in a stock market, a depression is a bad time to rebalance one’s portfolio (think impulsive decisions), the very fact that I became pretty uneasy over these recent unpleasant events tells me that I probably didn’t have all the right equations to begin with. Rebalancing seems to be in order once the dust settles on the present issues.
• DIVERSIFY -your dreams, your ambitions, and your approaches (think backup plans). Banking too much on any given aspect of life with a narrow focus is like betting all your money on WorldCom. Unfortunately, we become so cozy with specific things that work for us, that the importance of diversification is not felt till we sense the threat of an impending disaster. And usually, it’s too late by that time to do anything about it.

All said and done, for now, all I have to do (rather, all I can do) is focus on the big picture, suck it up, and give a fight till the good times return.

Unfortunately, there is no Federal Reserve for life that can boost your confidence by tweaking some interest rates; probably that’s why life’s a beach while the stock market isn’t.

Recently, a reader added some extra dimensions to the topic which amounted to saying that most personal finance bloggers are rich and self-righteous. [Editor's note: I had the comment quoted here, but the author wanted it removed, so it's gone now]

Any thoughts?