I agree whole-heartedly with your point about not deciding for someone else whether or not things are worth your time -- especially when it comes to admission. I would like to know what information Harford is basing this part of his argument on (is it part of Ariely's book? Harford's own experiences? Statistics?).
First of all, there's a big difference between free admission events versus museums and galleries that are free (or nearly free) all of the time (like many of the galleries and museums in Britain). To lump them all together seems to show an ignorance of museums and galleries in general.
Second, many of these free events are in place so that the general public can have access to these programs and facilities -- regardless of their financial situation. Sure, it may not be worth it for a lone professional to wait in line for these events when they can afford to go anytime, but what about a family of five? To say to avoid these events is ridiculous -- art and culture isn't just for the elite who can afford it.
Third, waiting in line and dealing with crowds doesn't always have to do with whether or not something is free. I've waited in line and dealt with crowds to see popular exhibitions while the "free" part of the gallery was uncrowded and very pleasant. People wait in line for rides at amusement parks, and those certainly aren't free!
Great article and I just wrote about my views on the bill. Your points just conifrm why the housing relief bill will fail. As I wrote recently - - The government again is trying to spend us out of an economic crisis, which is unlikely to work and only add to our national debt and the continued devaluation of the US dollar. Only time and a cleansing of the economic system will resolve the current mess.
We talk about consumers getting out of debt, what about the government who seems to love debt more than anyone else.
I don't think eating a big breakfast is a bad thing. While on vacation in Chicago over the 4th of July weekend I feasted at breakfast -- it's usually the cheapest meal of the day on a menu. Eating a big breakfast fills you up, gives you (or at least me) energy for the day, and I ended up eating minimally for lunch and dinner because of it. I'd rather pay $10 for a hearty breakfast than $25 for dinner, if I can help it. (Of course, the-maybe $3 that hearty breakfast would have cost me to prepare it at home would be even better...)
I will continue to use credit cards as long as it is profitable. If the economy were to make it impossible for me to continue being responsible, I'll stop.
And the gym is again a very personal choice (although I don't have access to one currently, so I improvise with several of the great options you have mentioned in your article.) For some, it is also the social interaction, peer accountability, daycare or shower services, and the advice of expert trainers that make gym memberships a valid expense. I have been on both sides of this coin, so I can understand either way.
As a response to the comments above there is no time when I am anything but straightforward. Your assertion that there are more people who do not make it thru our pre-screening process is accurate but not because of eligibility. They make the personal financial choice to not purchase the coverage many times at a price that is still affordable in perspective to their medical risk but either don't have the money or do not place enough value when comparing the cost and benefit provided. For example a female Age 60 with type 2 diabetes treated with insulin would run approx. $1934 per year for $300,000 on a 15 year level term plan assuming no other major health issues. A history of depression would be even less. The male rate is $2875. The prices drop to $1389 for female and $2170 for male on 10 years plans and will are approximately double for those at age 70. These are all high rated cases based on the health history examples you noted. Prices are greatly reduced when you get into the preferred and standard rates classes. However people continue to decide not to purchase coverage even when the cost for a 60 year old for $300,000 is as low as $800 a year. All of these amounts are affordable depending on the personal circumstance of the individual. In addition, I don't believe the answer to your concern is for someone to buy an inferior investment related product that will cost them 8-10 times the cost of term when they are healthy just so they can have coverage if they need it in later years. A true financial advisor tries to manage their clients total financial picture by helping clients focus on the real menaces to their financial future...DEBT. By using the savings from buying term an individual can eliminate high cost debt such as credit cards and eventually all debt and will be much better focused on growing wealth with better financial instruments than insurance...even with the tax deferred (not tax free) benefits a cash value plan offers. Remember any growth in a cash value plan over your premium payments (cost basis) is taxable at your income tax rate when you withdraw them...if there is an increase. Many cash value agents will tell you it can be tax free instead of deferred since you can borrow against the cash value instead of withdrawing it. But then you pay interest for access to your own money and when you die they reduce the death benefit by the loan amount. That doesn't sound free to me. The scare tactic that most companies use about being without insurance has been very effective for over a century. However with the advancement in the last 20 years in long term guaranteed level term style plans, inproved medical care and underwriting analysis the amount of people truly affected by this issue is very small. In addition, it assumes you will always be in debt and not capable of handling your financial responsibilites for the rest of your life. Not a strategy I follow or recommend to my clients.
I disagree with champagne at lunch...that's ludicrous! Clearly author forgot the summer beverage of choice is a nice weiss or hefeweizen with an orange slice!!!
Seriously though as a man, a manly man, I think the rest of the article was spot on. We're all after the same things...to look and feel good. Some of the most relaxed and happiest people I know are healthy, sexually active, social, funny sorts with a great tan. Others that look horrible (or unhealthy) are usually intense people with rigid rules/morals and it shows on their body.
Now a days they have monopoly (the board game) which uses credit cards instead of the original cash. This is a great concept but I am a little worried people will get too used to using credit cards. Like you said in this post, you spend more when you use credit cards
leaving your creditcard at home is not always a good idea. In a lot of countries it's a convenient way to pay for about everything and you sometimes need it for legitimization if you (for example) rent a car.
Don't forget that I also suggested that people who abstain from drinking alcohol are no fun. I haven't heard anyone complain about that yet. Are we in agreement on that point, at least?
Mind you, I didn't actually suggest that anyone should reduce their intake of water or use people, but hey, why actually read the blog post when you can skim the headlines?
Listen, everyone has different morals that they live their lives by. Mine might be different than yours, but don't misrepresent my words because you disagree with them.
It's partly you sense of status among peers that determines happiness, regardless of wealth. It has long been known that societies with much less income inequality than ours, even much poorer ones, are generally much happier ones. Status in this country is often tightly tied to income, though education can make up for it a little (only a little, try being a phd homeless person for a while and see how you feel in the company of people who aren't also homeless). This kind of happiness is also connected to overall health outcomes.
I agree that not everyone will find savings with DIY. I live 60 minutes from the closest repair shop, however, so unless I'm willing to shell out $200+ just to have someone make a diagnosis, I better be figuring out a way to DIMyself. (Plus hubby enjoys helping us be more independent -- you never know how difficult it may be in the future to get a decent contractor/repairman.) We have actually had instances where local mechanics have told us they wouldn't fix our van (a manifold intake gasket replacement) because it wasn't worth the hassle -- sometimes you have to do for yourself, if no one else will (regardless of what you offer to pay them.)
...but more than any of the reasons, I wouldn't want a stable, credit-based standard of living because I love the feeling of earning things.
That's why those initial firsts are so special. For the first time in life (for some of us), things aren't being subsidized in any way. We're earning every bit of our success.
Of course, I'm pretty much off the "stuff" wagon and don't get that same rush from buying key items. I think the challenge from this point is to transform and get that same satisfaction from giving instead of getting.
Have you actually tried using them lately? I don't know about using them domestically (in the US), but they were nearly impossible to use in Europe four years ago. My in-laws had to actually sign them over to us so we could deposit them in our European bank account, and we gave them the cash in euros. I don't know that they would have been able to get cash for them anywhere else. They had tried several places.
It's a nice concept to limit spending, but I'm not sure it really works. Just an FYI.
My standard of living took a big hit this year when I stopped working because I became very sick. I then had to sell off many of my assets in order to afford the things I needed to buy. But now it is starting to rise again...slowly
So I am looking forward to seeing it get better every month from now on.
My dad loves the handy man, DIY magazines and this is perfect for him. He saves load of money on maintaining the house just by buying and reading these magazines.
Me however, I don't really like DIY. I am a struggling entrepreneur and I prefer to spend my time on my business and website trying to make some money rather than trying to save some money :)
Wow, you really have some great ideas here. This is great for me as I am looking at going on holidays this weekend and I am also looking to go overseas in the next 12 months so this will definately save me money.
I am a struggling entrepreneur so a dollar saved really is a dollar earned for me. So thankyou for this
If my wife and I had the cash, we'd definitely pay up front for the house in cash.
If you calculated how much money you spent on a mortgage over 30 years, its more than twice what you paid for the home.
Not only that, but without a mortgage to pay, your living expenses drop considerably. You can then take the large chunk of money each month that would go to the bank and put it in an index fund, get a better rate than the overstated interest rate deduction and have a huge amount of money in 30 years.
That and the peace of mind of knowing you have a place to live that is yours is priceless.
I love Ready Made. Many of their projects can translate over to different styles or as the basis for other projects. They also put a few articles online for free each month.
Instructables is a great website to find things similar to Ready Made magazine, I think they have some association with Make magazine. Craftster is another good source for ideas how to do things.
I have been priced out of the neighborhood I grew up in also. The only upside is that now some of the neighborhoods that were too rundown or crime ridden when I was a kid are now fairly well rehabbed, have lower crime rates and services nearby.
I also looked at possibly moving back to northern CA and about died when I saw how much even a rundown shack costs there these days. I don't know how people afford to live there at all.
I hadn't really thought of what the cut-off point might be, but when I think "rural," I'm thinking of areas where there's at least 40 acres per household.
I'd call a community with 55,000 people a town.
Towns and small towns and villages are all much more fuel-efficient than rural areas. A few big trucks can deliver goods to shops in the commercial center, and then a large segement of the community is within walking or bicycling distance of those shops.
Hi I live in Southern Ca. In the suurbs and it can get pretty expensive with gas prices, mortgage,etc and the only debt that we have is our mortgage( no credit cards, no school bills) and we give 15% of our money to church and charity. My family of 5 lives off of approx.30k a year and sometimes we are strapped but we always have what we need and the majority of the things that we want. i believe that it all comes down to living within ones means and just doing what you gotta do. the more money one has the more they spend, but when the moeny is low one learns to live with what they have not what they don't.
I agree whole-heartedly with your point about not deciding for someone else whether or not things are worth your time -- especially when it comes to admission. I would like to know what information Harford is basing this part of his argument on (is it part of Ariely's book? Harford's own experiences? Statistics?).
First of all, there's a big difference between free admission events versus museums and galleries that are free (or nearly free) all of the time (like many of the galleries and museums in Britain). To lump them all together seems to show an ignorance of museums and galleries in general.
Second, many of these free events are in place so that the general public can have access to these programs and facilities -- regardless of their financial situation. Sure, it may not be worth it for a lone professional to wait in line for these events when they can afford to go anytime, but what about a family of five? To say to avoid these events is ridiculous -- art and culture isn't just for the elite who can afford it.
Third, waiting in line and dealing with crowds doesn't always have to do with whether or not something is free. I've waited in line and dealt with crowds to see popular exhibitions while the "free" part of the gallery was uncrowded and very pleasant. People wait in line for rides at amusement parks, and those certainly aren't free!
Thanks Linsey for another great article!
Great article and I just wrote about my views on the bill. Your points just conifrm why the housing relief bill will fail. As I wrote recently - - The government again is trying to spend us out of an economic crisis, which is unlikely to work and only add to our national debt and the continued devaluation of the US dollar. Only time and a cleansing of the economic system will resolve the current mess.
We talk about consumers getting out of debt, what about the government who seems to love debt more than anyone else.
And that feast was eggs, oatmeal, coffee, fruit, a chocolate croissant.
I don't think eating a big breakfast is a bad thing. While on vacation in Chicago over the 4th of July weekend I feasted at breakfast -- it's usually the cheapest meal of the day on a menu. Eating a big breakfast fills you up, gives you (or at least me) energy for the day, and I ended up eating minimally for lunch and dinner because of it. I'd rather pay $10 for a hearty breakfast than $25 for dinner, if I can help it. (Of course, the-maybe $3 that hearty breakfast would have cost me to prepare it at home would be even better...)
I will continue to use credit cards as long as it is profitable. If the economy were to make it impossible for me to continue being responsible, I'll stop.
And the gym is again a very personal choice (although I don't have access to one currently, so I improvise with several of the great options you have mentioned in your article.) For some, it is also the social interaction, peer accountability, daycare or shower services, and the advice of expert trainers that make gym memberships a valid expense. I have been on both sides of this coin, so I can understand either way.
Thanks so much for your feedback!
As a response to the comments above there is no time when I am anything but straightforward. Your assertion that there are more people who do not make it thru our pre-screening process is accurate but not because of eligibility. They make the personal financial choice to not purchase the coverage many times at a price that is still affordable in perspective to their medical risk but either don't have the money or do not place enough value when comparing the cost and benefit provided. For example a female Age 60 with type 2 diabetes treated with insulin would run approx. $1934 per year for $300,000 on a 15 year level term plan assuming no other major health issues. A history of depression would be even less. The male rate is $2875. The prices drop to $1389 for female and $2170 for male on 10 years plans and will are approximately double for those at age 70. These are all high rated cases based on the health history examples you noted. Prices are greatly reduced when you get into the preferred and standard rates classes. However people continue to decide not to purchase coverage even when the cost for a 60 year old for $300,000 is as low as $800 a year. All of these amounts are affordable depending on the personal circumstance of the individual. In addition, I don't believe the answer to your concern is for someone to buy an inferior investment related product that will cost them 8-10 times the cost of term when they are healthy just so they can have coverage if they need it in later years. A true financial advisor tries to manage their clients total financial picture by helping clients focus on the real menaces to their financial future...DEBT. By using the savings from buying term an individual can eliminate high cost debt such as credit cards and eventually all debt and will be much better focused on growing wealth with better financial instruments than insurance...even with the tax deferred (not tax free) benefits a cash value plan offers. Remember any growth in a cash value plan over your premium payments (cost basis) is taxable at your income tax rate when you withdraw them...if there is an increase. Many cash value agents will tell you it can be tax free instead of deferred since you can borrow against the cash value instead of withdrawing it. But then you pay interest for access to your own money and when you die they reduce the death benefit by the loan amount. That doesn't sound free to me. The scare tactic that most companies use about being without insurance has been very effective for over a century. However with the advancement in the last 20 years in long term guaranteed level term style plans, inproved medical care and underwriting analysis the amount of people truly affected by this issue is very small. In addition, it assumes you will always be in debt and not capable of handling your financial responsibilites for the rest of your life. Not a strategy I follow or recommend to my clients.
I disagree with champagne at lunch...that's ludicrous! Clearly author forgot the summer beverage of choice is a nice weiss or hefeweizen with an orange slice!!!
Seriously though as a man, a manly man, I think the rest of the article was spot on. We're all after the same things...to look and feel good. Some of the most relaxed and happiest people I know are healthy, sexually active, social, funny sorts with a great tan. Others that look horrible (or unhealthy) are usually intense people with rigid rules/morals and it shows on their body.
I prefer alotta laughs and fun liberal sex.
As for the yearly gym membership, there is a better way to save on that completely. You don't need a gym membership to stay in top shape.
http://yinvsyang.com/7-ways-to-stay-incredibly-fit-without-joining-a-gym/170/
Now a days they have monopoly (the board game) which uses credit cards instead of the original cash. This is a great concept but I am a little worried people will get too used to using credit cards. Like you said in this post, you spend more when you use credit cards
leaving your creditcard at home is not always a good idea. In a lot of countries it's a convenient way to pay for about everything and you sometimes need it for legitimization if you (for example) rent a car.
The rest are all great tips!
Don't forget that I also suggested that people who abstain from drinking alcohol are no fun. I haven't heard anyone complain about that yet. Are we in agreement on that point, at least?
Mind you, I didn't actually suggest that anyone should reduce their intake of water or use people, but hey, why actually read the blog post when you can skim the headlines?
Listen, everyone has different morals that they live their lives by. Mine might be different than yours, but don't misrepresent my words because you disagree with them.
It's partly you sense of status among peers that determines happiness, regardless of wealth. It has long been known that societies with much less income inequality than ours, even much poorer ones, are generally much happier ones. Status in this country is often tightly tied to income, though education can make up for it a little (only a little, try being a phd homeless person for a while and see how you feel in the company of people who aren't also homeless). This kind of happiness is also connected to overall health outcomes.
I agree that not everyone will find savings with DIY. I live 60 minutes from the closest repair shop, however, so unless I'm willing to shell out $200+ just to have someone make a diagnosis, I better be figuring out a way to DIMyself. (Plus hubby enjoys helping us be more independent -- you never know how difficult it may be in the future to get a decent contractor/repairman.) We have actually had instances where local mechanics have told us they wouldn't fix our van (a manifold intake gasket replacement) because it wasn't worth the hassle -- sometimes you have to do for yourself, if no one else will (regardless of what you offer to pay them.)
...but more than any of the reasons, I wouldn't want a stable, credit-based standard of living because I love the feeling of earning things.
That's why those initial firsts are so special. For the first time in life (for some of us), things aren't being subsidized in any way. We're earning every bit of our success.
Of course, I'm pretty much off the "stuff" wagon and don't get that same rush from buying key items. I think the challenge from this point is to transform and get that same satisfaction from giving instead of getting.
Have you actually tried using them lately? I don't know about using them domestically (in the US), but they were nearly impossible to use in Europe four years ago. My in-laws had to actually sign them over to us so we could deposit them in our European bank account, and we gave them the cash in euros. I don't know that they would have been able to get cash for them anywhere else. They had tried several places.
It's a nice concept to limit spending, but I'm not sure it really works. Just an FYI.
Hey guys,
Here is a great book to help you distinguish the differences between safe and dangerous hypermiling techniques.
http://hypermilingbook.com/"
My standard of living took a big hit this year when I stopped working because I became very sick. I then had to sell off many of my assets in order to afford the things I needed to buy. But now it is starting to rise again...slowly
So I am looking forward to seeing it get better every month from now on.
My dad loves the handy man, DIY magazines and this is perfect for him. He saves load of money on maintaining the house just by buying and reading these magazines.
Me however, I don't really like DIY. I am a struggling entrepreneur and I prefer to spend my time on my business and website trying to make some money rather than trying to save some money :)
Wow, you really have some great ideas here. This is great for me as I am looking at going on holidays this weekend and I am also looking to go overseas in the next 12 months so this will definately save me money.
I am a struggling entrepreneur so a dollar saved really is a dollar earned for me. So thankyou for this
If my wife and I had the cash, we'd definitely pay up front for the house in cash.
If you calculated how much money you spent on a mortgage over 30 years, its more than twice what you paid for the home.
Not only that, but without a mortgage to pay, your living expenses drop considerably. You can then take the large chunk of money each month that would go to the bank and put it in an index fund, get a better rate than the overstated interest rate deduction and have a huge amount of money in 30 years.
That and the peace of mind of knowing you have a place to live that is yours is priceless.
Forget worrying about a 20% loss in home equity.
Worry about the 50% devaluation of the U.S. dollar since 9/11.
Sure, we can "monetize" the mortgage market, effectively nationlizing the losses (up to several hundred BILLION dollars)
But that only further trashes the dollar internationally.
And since oil is priced in dollars...$6/gallon gasoline, anyone?
The rational response is capital flight - ship one's dollars overseas for anything else, at whatever exhange rate one can get.
Of course, once that happens, it is unlikely that capital will ever come back home.
I love Ready Made. Many of their projects can translate over to different styles or as the basis for other projects. They also put a few articles online for free each month.
Instructables is a great website to find things similar to Ready Made magazine, I think they have some association with Make magazine. Craftster is another good source for ideas how to do things.
I have been priced out of the neighborhood I grew up in also. The only upside is that now some of the neighborhoods that were too rundown or crime ridden when I was a kid are now fairly well rehabbed, have lower crime rates and services nearby.
I also looked at possibly moving back to northern CA and about died when I saw how much even a rundown shack costs there these days. I don't know how people afford to live there at all.
I hadn't really thought of what the cut-off point might be, but when I think "rural," I'm thinking of areas where there's at least 40 acres per household.
I'd call a community with 55,000 people a town.
Towns and small towns and villages are all much more fuel-efficient than rural areas. A few big trucks can deliver goods to shops in the commercial center, and then a large segement of the community is within walking or bicycling distance of those shops.
Hi I live in Southern Ca. In the suurbs and it can get pretty expensive with gas prices, mortgage,etc and the only debt that we have is our mortgage( no credit cards, no school bills) and we give 15% of our money to church and charity. My family of 5 lives off of approx.30k a year and sometimes we are strapped but we always have what we need and the majority of the things that we want. i believe that it all comes down to living within ones means and just doing what you gotta do. the more money one has the more they spend, but when the moeny is low one learns to live with what they have not what they don't.