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Tuesday, August 19, 2008

The End of an Affair

Most people love money. So many people today choose to buy expensive material things and validate themselves by these purchases. Money helps people feel important, to take control, to make a statement about who they are. Money becomes a best friend, a family member, and a lover. Obtaining money is all some people can think about and all that they believe in. It doesn’t matter how they get it or who they hurt in the process, as long as in the end they get the money they need to feed their addiction.

Some people don't have the means to gain the money they desire but this doesn't stop them from having irresponsible flings with it. Even though these people may be late on their bills, they will go out and buy something they can't afford just to make themselves feel better. And it will usually work. During the heat of the moment people who make an impulsive purchase will feel like they are at the peak of their happiness. And when the feeling disappears they'll likely feel guilty, ashamed and regretful. Not much different than a one night stand.

Like all love affairs, my own love affair with money was short, sweet and tumultuous. It was both satisfying and completely unsatisfying at the same time. And similar to many love affairs, mine began at work. My job as a sales representative on Wall Street in New York City started up a love for money that would only go away after it ran its course. It became a love-hate relationship in which I began to spiral out of control.

Making a ton of money as a person who wasn’t even good at her job seemed like everything I ever wanted. I was renting an apartment in a top building and I was able to buy anything I wanted. I shopped in boutiques, purchased the newest cell phones the day they hit the market and treated people to dinners and drinks. What I didn’t realize at the time was that I was building my life around money and money was the thing that was in control.

After I lost my job the love affair became quite rocky. I no longer had the sparkle of admiration I once felt towards money since it was now seeing less and less of me. I moved out of my elevator building apartment into someone’s rental in their house. I went from having a washer, dryer, dishwasher, microwave and air conditioner to having none of these. The quiet of the building I had lived in was replaced by screaming landlords who constantly argued with each other. Instead of shopping at boutiques I started shopping at Old Navy and other discount clothing stores. Eating out and partying all the time was replaced with staying home and cooking dinner.

Some people in my situation would have never given in to the evil tricks that money played on them. These types of people would have picked themselves up, got a new high paying job and started up their love affair again. They would believe that they were back in control, but of course this would just be another trick money would play on them. The second time around would likely be more passionate than the first, and it would become a lifelong addiction that created life for those who chose it. People that would never dream of a real life affair find themselves embroiled in controversy and secret desires.

But love affairs rarely end up so happy in the end. If they do, it takes a lot of pain and struggle to get to the end goal and a lot of people get hurt in the process. I chose to end my love affair with money by replacing it with something real, a true love that was not based on sneaky escapades and under-the-cover operations. As you look back on the choices you’ve made thus far in your life, ask yourself, are you in the midst of an affair?

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Tuesday, April 29, 2008

What A Little Effort Can Do For Debt Reduction

There are many, many things I love about my life here in the beautiful mesas of the Chihuahuan Desert. Among those are the contrasts, the juxtapositioning of old and new ways of living.

While I make use of the remarkable technologies of today as I write this now, I spent some time this morning as the indigenous women of this region did for thousands of years -- making tortillas. And, while I was working, I was thinking about a couple things related to cooking at home -- far less expensive and far more healthy overall.

I could buy tortillas. They run about a dollar a
dozen. In the photos (always clickable for a larger view), I am mixing up a batch of about 40 for less than a dollar... and, if I do say so myself, my home-made, fresh tortillas are far better than those mass produced in the factory and bagged up. Everyone here has said so, too.

In the big pot next to my wanna-be comal -- I have no proper comal for tortilla making, so I make do with a well-seasoned iron skillet -- are about 5 pounds of pinto beans. I'm feeding 9
people with hearty appetites. I'll be smashing and
frying a good portion of those beans with some
spices for tacos tonight, which is why I made
tortillas this morning. The rest of the beans will be used tomorrow by my sister to make her awesome chili.

The dried beans are pretty inexpensive, about 2 dollars for 4 pounds. Canned beans are easily double and often triple the price. It seems kind of silly to pay that when cooking dry beans is so easy. If I wanted to, I could buy canned refried beans for my tacos, though that would also be much more expensive, and I'd still have to add spices to make them palatable. Furthermore, they'd be less nutritious from the can, and probably have MSG and be high in sodium.

My point, over all, is that many people spend a lot of money on prepared foods, convenience foods, and drive-through foods, when by investing a little effort they could save a considerable amount on their food bill by cooking at home. Furthermore, most of those quick foods are price heavy and nutrition light. The benefits of eating fresh, whole foods are innumerable, but if we stick to the financial aspect for a moment, improved health leads to less money spent on costly health care.

There are many things in day-to-day life that are similar. For those looking to reduce debt and decrease spending (leaving more money for saving or more time for something other than working to pay the bills), learning to do basic repair tasks around the home and on the auto really isn't all that difficult. Being less dependent on others to meet your needs is a very good thing, particularly in today's economic climate.

I've been following the recent news about food shortages, skyrocketing prices, and the rationing of some food items throughout the world with a blend of fascination and horror. This is exactly the scenario that inspired me to remove my family from the city. I, geek that I am, have strange hobbies. Global economics is one of those hobbies and I've been watching trends for a few years now. To me, as well as to many financial experts, it looks like times are sure to be fiscally challenging in the near future and for a significant period of time thereafter. The financial markets are going to have to go through their spasms of correction and we're all going to have to go along for the ride.

During the Great Depression, while those in rural areas did experience severe poverty, they did have a significant advantage over those living in urban areas -- the ability to grow and hunt for their food. During World War II, the Victory Garden was an important supplement to households throughout the nation, including urban neighborhoods, as common, daily-use foods were rationed by the government. Looking at our situation today, it seems that learning to develop a bit of food self-sufficiency -- whether by cooking more, creating urban patio or fire escape gardens in containers, or larger suburban or rural gardens --is not just good economics in terms of a debt reduction plan or strategy for reducing overall expenses, but also simply good old-fashioned common sense.

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Friday, April 18, 2008

Have I Got A Debt Reduction Plan For You!

This is the view that I enjoy during dinner today. (photo credit, David Secor) Click it if you'd like to see the full-sized version.

It's a big change from just a few months ago, where the dinner hour conversation was interrupted by deep bass thumping out of the speakers of passing cars and by the loud hip hop and reggae music streaming from the cars waiting outside of the local drug selling spots.

I no longer step out my door onto a sidewalk littered with wrappers and trash left by careless people passing by when leaving local businesses, legitimate and illegitimate. Instead, I am greeted by wide-open sky and an almost mystical natural beauty.

The children have more freedom than they've ever experienced. When they lived in the city, they weren't allowed to play out front without adult supervision. It was not safe. After a couple of exchanges of gunfire between neighborhood drug dealers, it was no longer safe to allow them to play in the backyard without supervision. Today, they run, they play, they explore. They see the night sky and countless stars, they see wildlife. They are learning so much and are having a wonderful time.

And, best of all, I've significantly reduced my debt burden and, as time goes on, will continue to lessen the amount of cash I need to spend on daily living -- certainly a good thing with all the turbulence and trouble in the realm of economics. Not only is the United States struggling, but the world as well. Major exporting nations banning the export of rice and of wheat, oil prices skyrocketing, food costs rising, the dollar dropping in value... the list goes on and on. Clearly, it is a good time to consider debt reduction, with a goal of debt elimination, and the building of a more sustainable lifestyle.

Oddly enough, reducing my debt burden began with taking on more debt -- $20,000, to be exact. However, this debt is productive debt, very productive indeed. The concept of productive debt versus consumptive debt is a bit of an old-school notion. Though, I suspect that, as these easy credit, no money down, buy now pay later, no doc loans days come to an end, that old-fashioned, old-school notion will soon be back in style, at least among the smart set.

So, what did I get for my $20,000 no credit check, easy terms debt? The one that I pay back at a rate of $360 per month? The one that, if I pay the principal all off within the year, becomes significantly less, as the interest charges that bring it up to $20,000 will be waived? (And, I will!) I got 46 acres of land, in a warm and sunny climate perfect for relying on solar power, in a region with winds that make wind power an attractive alternative to more traditional energy sources. I got space for food growing and home building. I got a lifestyle that -- immediately upon my arrival, before anything was set up at all -- dramatically reduced my living expenses.

In NY, the last heating bill I paid for my apartment in the two-family house I shared with my sister was just over $600 and that was for the month of December. I have no heating bill here, but I do have a lovely tan. The monthly land payment is less than the amount I gave my sister monthly for my half of the mortgage on the house. (We got rid of that when we came here.) Those are just a couple of the quick and easy ways that I've experienced a reduction in my living expenses.

In the weeks to come, you can expect to read more about my adventures in working towards a debt-free and richly economical lifestyle. I look forward to sharing the details of my personal debt reduction plan and my progress in making it happen. I hope that some of my experiences are useful to you, helpful in your efforts to achieve your own debt and lifestyle goals.

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Tuesday, February 05, 2008

Frugal Living Makes Headlines?

Apparently, living within one's means is so uncommon these days that the New York Times reports a 'cultural shift' moving Americans toward not living like debt is a lifestyle, but like the burdensome financial responsibility that it is. Because of the economic slow down stemming from increasing foreclosures and unemployment, fresh credit is harder to attain, so people are cutting back. That's what the New York Times is reporting.

Is being marginally responsible news now?

What happened to the values that we learned growing up? What happened to saving for a rainy day, not taking more than you needed, exercising restraint? I understand that sometimes people find themselves in a tough spot and often have no choice but to use credit to live, but most of us don't fall into that category. Most of us have financed lifestyles that our paychecks can't justify. Most of us have at some point or another lived as happy contributors to the debt carrying culture we call Western living.

Well, now the chickens have come home to roost. It's time for us to pay up and live like people did before consumer credit became mainstream.

It sounds good to me.

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