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June 2008 - Posts - The Dollar Stretcher
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The Dollar Stretcher

The Dollar Stretcher blog will explore people and money.

June 2008 - Posts

  • Being Really Green

    Lately eveyone has been touting their 'green' credentials. You don't have to look too hard to find someone talking earnestly about 'carbon footprints' or expounding on renewable energy. I admit that some of them seem a little phoney to me. Here's why. Their lifestyles don't match their rhetoric. In other words, they're walk doesn't match their talk.

    When the conversation turns to environmental issues, I have my own 'green test'. It's my way of finding out whether the person really cares about the environment or is just mouthing something that they read in a magazine or heard at a rally somewhere. 

    I'll ask if the person shops at garage sales and thrift stores. It takes natural resources to make most things. Buying used means that you're not consuming those resources. That's real environmentalism.

    The person who's really concerned about the environment will make sure that their used items are given a chance for a 2nd (or better still a 3rd) life. Donate your used items to a thrift store, hold a garage sale or sell them on eBay. Just because you're through with something doesn't mean that it can't be useful to someone else.  

    I'll try to find when was the last time that they fixed something instead of replacing it. Often I get blank stares on this one. "Fix it??" You know the people I'm talking about. If the least little thing goes wrong, they're out shopping for a replacement. Nevermind that a repair might be easy. Or the problem might not affect how they use the item. They have their excuse to buy a new one. And they're not going to let tossing one more item into a landfill stop them!

    You see, I've known many people who have been good to the environment. But, many of them never thought of it that way. They were just living frugally. Looking for ways to avoid spending money came naturally. That meant fewer purchases. Considering alternatives before throwing something away was automatic. In the process they walked gently on the earth and only consumed what was necessary.

    Personally, I'd much rather talk to the person living a thrifty lifestyle than the expert in carbon offsets. I find that I learn much more practical info that I can apply and benefit from. Things can actually make a difference in my life and also make a difference for the earth.

    Keep on Stretching those Dollars!

    Gary 

  • The Power of Many

     We've been trying to solve a puzzling problem with one of our website pages. It was one of those intermittent problems which are always hard to figure out. We finally came up with an explanation. Readers were using the page in a way that we simply hadn't expected. And, that caused a script to choke on the data provided. 

    The natural inclination is to ask why would people misuse the form. But, I really believe that's the wrong approach. They didn't misuse the form. They just looked at it differently than most people. And, that doesn't make them wrong. Just differernt.

    Or perhaps a better description would be that they're creative. They have the ability to see things in a way that most of us don't or can't. And that's valuable.  

    The same thing happens here at The Dollar Stretcher. No one person or even a whole writing staff could think of every way to save time and money. That's where you come in. We're blessed with over 100,000 reading our newsletters each week and another 100,000+ visiting the website. That's a lot of people who can bring their creativity to any problem that we face. And we don't hesitate to ask for your input. You've seen it in the 'can you help this reader?' series, our Dollar Stretcher Community forums, and other places.

    Thanks for being willing to share your wisdom, ideas and creativity. We're all much smarter because of you!

    Keep on Stretching those Dollars!

    Gary 

  • Teamwork

    Last weekend I was reminded of something that we all know, but seem to forget if we're not reminded every so often. A friend of mine had a big oak tree that needed to have a couple of limbs removed. Big limbs. Real big limbs! The cost to call in a tree surgeon would have been significant. Instead he asked for help from a group of his friends. 

    About a dozen showed up. Between them were 3 chainsaws of various sizes, a couple of pick-up trucks, an expert at tree climbing, a couple of expert cooks and a lot of willing hands. Being among the oldest (and probably weakest!) of the group I was assigned to the kitchen patrol (my wife warned me about not having a heart attack!). After we had the food (pork roast, pulled bbq pork, hot dogs, green bean casserole, potato salad, etc) in process we went out to check on the work crew. (just for the record, I was the 'gofer' for the two main cooks)

    They already had the biggest limb (about 20 inch diameter and 50 feet long) down. I have no idea what it weighed, but it was monstrous! Most of it was already gone. They were about to take the smaller branch off. It intersected the tree at about 25' off the ground and was about 15 inch diameter and 75 feet long. The tree climbing expert got to it and a saw was lifted up to him. As sometimes happens, as he cut the branch twisted and the outside of the branch got caught in another tree. The branch twisted and pinced the chainsaw bar. A few minutes of discussion and the guys had a couple of ropes on the limb and pulled it loose from the ground. Disaster avoided in a matter of moments!

    As soon as the branch hit the ground the guys swarmed it like ants at a picnic. One guy took his saw and cut off all the smaller branches that came off the main one. I joined three other guys pulling those smaller branches to a heap that would me chipped later. Another guy with a chainsaw was cutting the main branch into sections approximately one and a half feet long. Just about the right size for splitting for firewood. A couple of guys were loading the pieces into a cart attached to the lawn tractor. Right behind was a couple of guys raking up anything left behind. The whole job was done in about three hours! 

    It reminded me of an old-fashioned barn raising (at least I think that they're old fashioned...please let me know if that type of thing is still going on...I'd love to hear if any still happen). It's truly amazing how much work can be done (not to mention the sense of community) by a group dedicated to a specific task. 

    How does that relate to your finances? Good question, oh enlightened reader! Some of the best ideas that I know of right now for saving money are group efforts. Take, for instance, meal exchanges. They're most often seen in a workplace. Suppose that there are 4 members of the exchange. Each week each member prepares a meal big enough for all four families. They serve one at home and bring the rest (portioned out) to work to give to the other three members. So cooking one day means that each family has four dinners. Not bad! They save by buying larger sizes, but also because they're much less likely to use the drive-thru on the way home from work. After all, dinner is just a reheat away! For more on meal exchanges click here.

    Or how about the "Lunch Club"? It's similar to the meal exchange. Again, we'll suppose 4 members. Every fourth day each member is responsible for bringing lunch for the entire group. So instead of going out every day ($5, $6 or $7 a day) or coming up with something different for lunch each day, you only have to do something every fourth day. Another great deal. Check out one lunch club here.

    Carpools are another great example. Sure, we all like the independence that having our own car gives us. We can come and go whenever it's convenient. But, $4 a gallon gas does require some adjustments if our budgets aren't going to be trashed. (for the record I do not carpool. But I only live about 3 miles from work, so my consumption of gas isn't significant)

    Or what about having a garage sale? Group sales are much more fun. You can share advertising and enjoy a much bigger crowd of shoppers. I know of some neighborhoods that have an annual sale each summer! 

    I'm sure that you can come up with many more ideas. Why not talk to some friends/neighbors and see what you can come up with? Not only will you save some money, you might also enjoy a better sense of community!

    Keep on Stretching those Dollars!

    Gary 

  • Park My Car?

    I seem to have a problem that to my knowlege has not been addressed:     Due to gasolene increases I have been taking the advise of the experts on how to save money at the gas pump.  Consequently, I use my car as little as possible, by walking everywhere that I possibly can, using my car only when necessary, about twice per week.     Apparently this has been causing me several auto repairs which my auto mechanics attribute to my car not being used enough.  The most recent being a $90.00 car battery, which did not last me near as long as the batteries when I was driving more frequently.     This situation has me baffled as it appears there is far less cost for me to fill up the tank more often, then to be paying high repair bills.    

    I would appreciate your imput.

    Sincerely,

    Joan

    I'm not a trained automotive expert, but I am an old car nut and have a '65 Impala in my garage that goes out once or twice a month. So I spend a lot of time with cars and people who love cars.

    There's no reason that you should have to use your car more than once or twice a week. A modern battery and charging system should work fine under these circumstances. Most replacement batteries specify an expected life (i.e. 60 month, 72 month, etc). If you get much less than that there's probably something wrong with the charging system (alternator, voltage regulator) or a slow drain on the system. If all of your trips are very, very short you can buy a 'trickle charger' that will keep your battery charged. They run about $50 and are very easy to use. But, even that shouldn't be necessary if the car is being driven a couple of times a week.

    As to the rest of the car, a twice a week drive shouldn't cause any problems. Generally a car needs to sit for months before gaskets and seals will give you trouble. Gasoline should be good in your tank for 6 months or more.

    Perhaps your mechanic knows something that I don't, but I hang around people who use their collector cars infrequently. And, how to store cars that aren't used is a common topic for discussion. My guess is that he's just using that as an excuse for things that were going to go bad anyway due to age.

    I'd go back to walking and see what happens.  

     Keep on Stretching those Dollars!

    Gary 

  • Unintended Consequences

    I bet that you like low interest rates. I do, too! They make it much easier for people to borrow and repay loans. That's something that both borrowers and lenders like. Making it easier to repay loans!

    Not only are low interest rates good for borrowers and lenders, they can also spur the economy in two ways. First, domestically. If you can afford the mortgage on a new house then I get to build it. Good for the economy!

    Plus it makes it easier for people to refinance those nasty adjustable mortgages that are getting all the headlines. Congress, the mortgage lenders and homeowners all like that.

    It's also good internationally. Lower interest rates makes American goods cheaper in the world market. That means that we're able to see more 'made in America' product in places like Europe and Asia. Great for the American worker!

    So how do we get lower interest rates? Well, when you cut through all the fancy economics talk, the bottom line is that you print more money! Yep, it's that simple. Just crank up those presses a notch or two and dollars are plentiful for all of us.

    Sounds pretty good. That's why the Federal Reserve is holding interest rates down and Congress doesn't mind spending money that the government doesn't have. Whirrr! You can just hear those presses run.

    And it would be good except for a couple of little problems that need to be worked out. The first is that it makes imported goods more expensive for us. So those Nike's that Junior wants or the (gasp!) gasoline that you put in your tank will cost more. The Saudis know a falling dollar when they see one.

    Yes, those cheaper dollars won't buy as much of all the foreign goods that we like so much. We're importing a little over $200 billion a month. So it's not just gasoline and sneakers that will cost more.

    Looks like the small problems with cheaper dollars aren't really so little. In fact, at $4 a gallon for gas, it looks like those cheaper dollars could turn out to be very expensive.

    So what's the average consumer to do? Be prepared to see imported items (like oil and sneakers) cost more. Don't believe any politician who claims that they can pass a bill and make those things cheaper. They can't (and if they were honest they'd admit it).

    Anything that they try to do will only make it worse. If you don't believe it read about the Smoot-Hawley Tarriff Act that was a major cause of the depression of the 1930's. That time they were trying to protect the American worker from low cost foreign goods. It didn't work out too well.

    What else can you do? Change your habits to reflect the new prices. Find a way to drive less. Carpool. Switch your workweek to 4 ten hour days. Shift your day so you can commute before or after 'rush hour'. Find some way to reduce the amount of gas that you must buy.

    If you have any extra money it's a good time to pay down any variable debt. The higher prices (think inflation) will almost certainly cause higher interest rates some time soon. And, that means that any debt that's tied to interest rates will cost you more. So pay it off now. Make it a priority. The last time that we choked off inflation with higher interest rates unemployment went up. It's much easier for you and I to pay off debts when we have a job.

    Have a variable home loan? You'll want to convert it over to a fixed loan. You might even want to pay off your credit cards and add that to the new loan. (a caution: this will only work if you have the discipline to pay off your entire credit card bill each month from now on)

    Finally, don't sit back and wait for someone to solve the problem for you. The same people who brought you the problem aren't likely to solve it.

    Your best bet is to recognize the change in prices today and make changes to the way you live. Prepare for the changes in interest rates to come. No one is saying that the future will be easy. But, it will be easier if you start making changes now.

    Keep on Stretching those Dollars!

    Gary Foreman

  • Frugal Friends

    One thing that I really enjoy about my job is that I get to meet a lot of interesting people. And, not surprisingly, many of them are of the frugal living stripe.

    Two of them are Annette and Steve Economides. They're often referred to as "America's Cheapest Family". I've had the pleasure of trading ideas with Steve on more than one occassion. If there were a frugal living all-star team, you'd find Steve and Annette on the first team! They have a website that I'm sure you'll find interesting.

    Recently, I was introduced to Vicky and Jen and their site called "What Really Matters". They wanted me to know about a podcast interview they did with Annette and Steve. If you're a podcast fan you'll want to check it out. Their discussion touched on pricey  
    cleaning products, money and kids, grocery shopping and more. You might want to check out the rest of their site. I spent some enjoyable time their myself.

    Keep on Stretching those Dollars!

    Gary

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Gary is a former financial planner and purchasing manager who edits The Dollar Stretcher website <www.stretcher.com> and newsletters. You can follow Gary on Twitter.com/gary_foreman
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