Financial Eye for the Broke Guy: An Interview with Dollar Stretcher's Gary Foreman
Myscha: Over the years, I've used many of the ideas from your web site and newsletters to carve out extra money for savings and family use. What savings areas if any do you notice the most interest in? For example, would you say groceries and meal prep tops the list, or is the personal care category more popular? Frugal minds want to know . . .
Gary: The busiest areas are probably groceries and auto financing. But, what we really want to do is to answer your question, whatever it might be. The loneliest feeling is when you think that you have a problem and you're the ONLY one in the world that has it. Finding a solution can make a big difference.
Myscha: What are some of the top ways to save money you’ve noticed over the years, and can you suggest some specific articles from Stretcher that feature those ideas? Basically, what are your faves?
Gary: The most useful tool for most families is something called a "grocery price book". Short of selling your house or car, food is the best place to save real money. And the best way to do that is to use a price book. I regularly hear from people who have cut their bills by 15% or more without changing what they buy or eat. It's a simple tool that anyone can understand and use. We have a number of articles on price books at Stretcher. One article in particular explains it exceptionally well.
Myscha: This next question relates to memorable customer / reader moments. We all have them, and I’m curious as to whether you have any that stand out in your mind. This could be unforgettable questions, jokes . . . anything really. Is there anything particularly crazy and out there that someone has written in about?
Gary: There have been some crazy ideas, but we don't look at them that way. If an idea works for you, then it doesn't matter if it seems crazy to me. Our business is to encourage people to try new things and share what worked for them. So as long as they're doing that we'll never point to a reader's idea and call it crazy. The first caveman who struck two rocks together probably had people shaking their heads. Until he discovered fire and cooked their dinner!
Myscha: How has your life changed since leaving the financial planning arena to produce and edit the Stretcher material?
Gary: My life is much happier now. I'm a blessed guy. I get to do something that I thoroughly enjoy and make a living doing it. Not that being a financial planner was bad, but I've always wanted to own my own business and be able to make my own decisions. I get to do that. I'm passionate about the subject (frugal living). I get to work in an environment that's continually changing (and thus challenging). And, I get to meet and work with some fascinating people. Doesn't get much better than that!
Myscha: What do you see as the greatest unexpected benefit of financial independence?
Gary: It's different for each one of us. Money makes a terrible master. When we're working for it, our days are long and hard. But, if we get to the point where our wants/needs are in line with our income, then money can begin to work for us. We can use it to fund all kinds of things. Those things can be for us (possessions or experiences) or for others (charity). Stress kills millions each year. When you're in charge of your money you've reduced or eliminated a major source of stress.
Myscha: Is there anything you feel people might not know about Stretcher that you wish they did? To quote a fellow Wise Bread blogger, it’s open mike night with this question. Feel free to go with your gut, your heart, or both.
Gary: That Stretcher.com started as a layoff project. I was working as a purchasing manager for a company that made mainframe computers. We were laying off people every quarter. I started The Dollar Stretcher while I was still working. Fortunately, by the time I was laid off (about 20 months later) the site and newsletters were starting to grow and showed signs of being successful. It's a good thing, too. Nobody wants to hire a middle-aged cheapskate!
Myscha: What do you see as hands-down the greatest piece of financial advice you ever received?
Gary: That's a tough one. There are many good answers. So it's a close call. Probably the most important one for today was emphasized by Benjamin Franklin over 200 years ago. He wanted people to learn the value of compound interest. It was so important to him that he left a small sum of money to the city of Philadelphia. The only rules were that the money had to be put into a bank earning interest and it could not be touched for 100 years. Compound interest turned the small sum of money into a fairly large sum, without anyone lifting a finger. I wrote an article on compound interest awhile back. I wanted people to understand how dangerous credit card debt was and how much easier life could be if they had money IN the bank instead of a credit card bill that they OWED the bank.
Myscha: You were here before many of the other financial blogs. What do you think of the newcomers and which financial blogs do you read on a regular basis? Who’s your Daddy?
Gary: We were fortunate to be one of the earliest sites on our topic (spring 1996). The early days were a lot of fun. Everything was so new and fresh. Most of us were pretty idealistic, too. I remember wondering whether readers would tolerate sponsor ads on our pages. Things got big quickly. I see a lot of good stuff out there. I think it's great the there's more info for consumers to use. My problem is that I don't get as much time as I'd like to just look for good financial blogs/sites. We often get tips from our readers when they find a good site. That's how I first learned about WiseBread.com. When we hear about a good one we try to pass it along.
Myscha: Favorite frugal finance resource: There are so many "financial gurus" out there. Which ones do you trust and recommend?
Gary: We make a point of not pointing to specific gurus. In part because we don't want to take responsibility for the advice that someone else is giving (you never know when one of these geniuses is going to have a brain cramp and suggest something truly stupid). But, mostly because the way to financial freedom isn't that complicated. It really doesn't require a guru. Just a willingness to learn some simple facts/techniques (compound interest, dollar cost averaging, diversification, basic tax planning, and a few others). The toughest part is to stay disciplined and put the fact/techniques to work. Most of us know enough (and will earn enough) to live very comfortably. The sad fact is that we're not willing to live consistently. And, when we get into trouble, we keep looking for a new answer (hoping to find someone that will tell us that there's an easy solution to the problem that we caused).
Myscha: Financial eye for the broke guy: Which personal finance books do you recommend for the average Joe?
Gary: There are a lot of good books on specific subjects, but for overall advice I'd say "Common Sense on Mutual Funds" by John Bogle. John founded Vanguard mutual funds, so he knows funds better than anyone. The book has been around awhile (1999), but the advice is timeless. Another is “The Millionaire Next Door” by Stanley and Danko. Everyone's heard of it and you can pretty much find it in any library. You can learn a lot by studying successful people. This is no exception. Finally, the basic text for frugal living, Amy Dacyczyn's “Tightwad Gazette”. Sometimes Amy took things to the extreme, but she reintroduced concepts that were lost during the 1950's and 60's to a new generation.
Myscha: Biggest financial temptation? Basically, where do you allow yourself the most luxury and why?
Gary: Cars, specifically old cars. I have a '65 Chevy Impala convertible that I take to local cruise nights. I've been in love with cars since I was a boy. And, the older cars are far more interesting than today's wind tunnel designed jobs. They had style and a spirit. Back then an Impala really could get up and run. If you weren't fast you'd be left in the dust. Today an Impala is just a badge to stick on the side of a jellybean car.
Myscha: Robust Elvis or thin Elvis?
Gary: Thin Elvis. Plus the Moonglows, the Harptones, Paragons, Del-Vikings and other great doo wop groups. OK, I'm not old enough to remember it from when it was new, but boy is that some pretty music! Hard to believe that it was mostly done by teenagers.
Myscha: Most hardcore frugal act ever: Just how extreme have you gotten?
Gary: I'd offer to let you talk to my wife, but she'd probably say something that would lead you to believe that I'm much cheaper than I really am. I guess it would be the summer that I decided our electric bills were too high. So I decided that we needed to cut back (including the AC). We live in south FL so AC is usually not considered optional. What made it interesting was that for the first month our electric bill was way down. So I really put the screws to our electric usage figuring I had found the mother lode. The whole family was getting mad at me by now. Especially when the second month's bill was higher than the bill was before we even started. Later I found out why by watching the meter readers in our neighborhood. In the summer, it's so hot that they skip houses and just put a low estimate in. That way they're saved a few steps and the homeowner won't complain about his high bill. They read the meter the next month and the consumer's bill gets 'caught up'. I took the low bill as proof that my methods were working. Turned out the meter reader was just trying to avoid heat prostration. (Of course, that's what my family was trying to do when I shut off the AC!)
Myscha: Personal finance goals: What’s the main thing you hope to accomplish with your financial success and planning?
Gary: Naturally I like to make enough so that my wife and I would be able to care for ourselves as long as we live. And, enough to give our kids a good start in life. Beyond that I'd like our readers to be able to do the same things for their own families. The goal is for everyone to have financial independence.
Myscha: Funniest behind the scenes moment in the Stretcher offices.
Gary: Our cheapskate boss doesn't allow any funny moments. Oh wait, that's me. We actually have a pretty loose office. Being in FL standard office attire is shorts, t-shirts and bare feet. If you're answering the phone you're required to sit up straight. We do tend to get quite a few local calls from people who think we're a dollar store. Occasionally we'll get one who doesn't believe us when we tell them that we are NOT a dollar store. We've even had a few that tried to convince me that we had to be a dollar store. And, one or two who seemed to think that we were lying to them. The calls are fun. Usually they ask for something simple, but once in awhile it'll be for something a little different (like the recent call looking for snake poison).
Myscha: Penny pinching butt kicks: Any particular instances you can think of where trying to be too frugal backfired on you?
Gary: Too many times to humiliate myself in public by retelling them! Over the years I've probably found as many ways NOT to save money, as I have found ways TO save money. My family fondly recalls the time I went coupon crazy and cornered the toilet bowl cleaner market. Over the course of a couple of months I had managed to buy (1 or 2 bottles at a time) all of one brand of bowl cleaner in south Florida! Unlike cornering the gold market, there wasn't any financial upside to this one. In fact, it took seven or eight years to use (or give away) all of it. I had hoped that over time my family would forget about it. Turns out my hope was misplaced. Somehow they don't seem to forget this event. After all, it could have been much worse. I could have cornered the market on something expensive or something that no one would use. At least ultimately we got to flush all the evidence of my addiction so no one's the wiser today, except hopefully me!
Gary lives in South Florida along with his wife of thirty years and their two children. When he has a free moment you'll find him restoring a Checker station wagon nicknamed "Two Ton" or cruising a '65 Impala convertible with doo-wops playing in the background.
Something else you may not know about Gary? All that doo-wop tune playing sends him into a major Incredible Hulk style transformation after which he can leap tall stacks of bills in a single bound. What’s that? You remain unconvinced? Gary was concerned that might be the case and sent along the following image to document this phenomenon. And you all thought he hired a professional actor . . .
Thanks for all the great tips Gary, and for continuing to do what you do. Keep up the good work!