I opened our front door to pick up a package that was delivered. It was sitting right on the stoop so, I only had to bend down to pick it up which I did. I closed the door and went into our kitchen to open the package. As I crossed the kitchen to get a pair of scissors I looked out to the front room and saw what I thought was a bird hitting the front window trying to get in. This isn’t that unusual. We have lots of birds hit our windows. We have lots of feeders around the house. Upon closer inspection I realized that the bird was inside the house trying to get out. I ran to the front room to get a closer look. Sure enough, the bird was sitting on one of my military hats on display on top of our bookcase. I called my wife for an assist. She was raised in an old farmhouse and has lots of experience chasing bats out of the house. At first, she didn’t believe what I was telling her. After getting over her surprise, we agreed that I would open the front door, and she would try to chase the bird towards me.
I opened the door and she shooed the bird. It first flew into the window and then made a b-line for the wreath on our front door. It landed in the wreath, took a quick glance at me, and then headed in the opposite direction out the door. I quickly closed the door, and then it dawned on me. It was dusk when I went to grab the package from the porch and our porch light was on. The wren must have been roosting in the wreath and when I opened the door, I must have startled it. As I bent down to pick up the package, the wren must have flown over me as I bent down and into the house. We are now slowly opening the door and checking for birds!
Your means is defined as your net take-home pay for your regular workweek. It doesn’t include overtime pay or bonus pay. I worked in the auto industry where we had many years when overtime was abundant. People made much more than their base salary year after year. They would get accustomed to having this money and would spend it as if they were guaranteed to make this much every year. The automotive industry is a boom or bust industry in a big way. Inevitably we would have four or five years when it was booming, and then we would have the lean years when we didn’t manage to work steady for 50 weeks out of the year. The plant would shut down for weeks on end and that meant unemployment. Now unemployment wasn’t bad for the union workers. With supplemental pay from the union, it amounted to about 98% of regular wages. For the people living above their means, by spending all their base pay plus overtime pay, 98% of regular wages was often a 50% cut in wages. Many people got in big trouble this way.
2. Never Purchase a Vehicle New
This may sound odd coming from somebody who used to work in the auto industry but the automobiles of today are nothing like the automobiles of 30 or 40 years ago. I remember when automobiles were rusted out after 3 years and started having serious mechanical issues after 70,000 miles or so. Today’s automobiles are highly reliable vehicles that will last a decade or more and are relatively problem free for 200,000 miles or more. Several thousand dollars can be saved by purchasing a certified pre-owned vehicle. You still have the 5 year/100,000 mile warranty and can rest assured that you are buying a trustworthy vehicle.
3. Don’t Trip Over a Dollar to Save a Penny
I knew a guy who would drive across town to buy gasoline 10 cents cheaper than it was across the street. He easily burnt up his savings in the gas it took him to drive across town. I know gas 10 cents cheaper sounds attractive but if you do the math it really isn’t a big deal. The average vehicle will take about 15 gallons to fill up. At 10 cents per gallon cheaper, you just saved $1.50. Even on a 30 gallon tank you only saved $3.00. You get the idea. Understand what your net savings are. Does it make sense to buy the more expensive item at the grocery store because you have a coupon? Many times the store brand is cheaper than the name brand minus the coupon savings. I don’t find enough difference in quality between name brands and store brands to warrant the difference in cost in most cases.
4. Don’t Carry Credit Card Debt
Credit card debt is a financial death spiral. They allow you to spend money you don’t have to buy things that you can’t really afford. It’s ok to use credit cards and when used properly, they have some pretty good perks. But if you can’t pay them off at the end of the month, don’t buy it. The interest on credit cards is usually high and before long, paying the interest on the debt is sucking up all your extra cash. And if you are late on a payment or miss one, the interest goes through the roof. Pay them off every month no matter what.
5. Cheapest Isn’t Always The Best Deal
This may seem like conflicting advice from item #3 but let me explain. I was in the market for a blender. The Vitamix I wanted is a top of the line blender but it also comes with a hefty price tag. I did a little research and compromised on a lesser blender at half the price. This blender did an adequate job. It wasn’t a Vitamix but for the price I felt the compromises were worth it. Now I don’t use a blender every day and before a year was up the motor on this blender burned up. I tried to do a warranty exchange but got nowhere with it. Luckily, I had purchased it at Costco, so I could return it under their replacement policy. I got a full refund and walked to the other side of the store where I purchased the Vitamix that I should have bought in the first place. I was lucky to have purchased it at Costco or I would have been out more than half the cost of a Vitamix blender and I probably would have purchased the Vitamix as the replacement anyway. The more expensive blender ended up being the more economical purchase over time.