Money Tips Network

Recently, my husband’s red Prius took a real beating on its left end side. We were at the grocery store, of course, when a little old lady’s cart blew from the corral she had just pushed it into across the parking lot at record speed. It was coming straight for us while we unloaded our groceries in the back, and I did my best to stop it. Unfortunately, I didn’t move fast enough, and our car wound up with the type of shifty-edged scratch you just cannot hide.

The single most powerful book on personal finance I’ve ever read is Your Money or Your Life by Joe Dominguez and Vicki Robin. I read it at my lowest point financially and it altered my perspective on personal finance more than any other book. I’ve written a great deal about this book’s impact on my life and the lessons it has taught me.

One of the major themes of the book is that it’s imperative that people sit down and figure out the small handful of values and things that are truly central to your life. Once you’ve figured out the handful of things that really matter to you, then cut back hard on everything else.

How many times have you bought new lipstick, only to find the color is less than flattering on you? Or maybe you accidentally purchased the wrong shade of blush, making it look like you stepped right out of a bad '80s movie.

This is the fifth entry in an eight-part weekly series that provides a detailed look at the book The Wisdom of Frugality by Emrys Westacott. If you’re new to the series, feel free to hop back to the first entry.

What is extravagance? Westacott boils down the term to three distinct meanings.

First, extravagance can refer to living beyond one’s means. If you make $30,000 a year but spend $35,000, you’re living an extravagant lifestyle simply because you’re spending more than you earn.

Second, extravagance can refer to being wasteful or careless of costs. Someone going into a store and tossing items they want into their cart without any concept of the price of those items is being extravagant.

After you've spent a lifetime investing for retirement, it can feel very different to invest in retirement. Many retirees are hesitant to start withdrawing from the nest eggs they've carefully built over the years.

Yesterday at the Financial Careers forum on Reddit, a user named /u/unfoldcareers posted some useful advice for job-seekers. “I’ve reviewed and screened thousands of resumes,” /u/unfoldcareers writes, “and I’m sharing my preferred resume format…along with my best resume advice.”

The poster notes that “bad resume format” leads most folks to get little or nor response to their job applications. To help current job hunters, /u/unfoldcareers created a free resume template that can be downloaded via Google Docs.

While there is no such thing as a “magic formula” for building wealth, living below your means is by far the closest thing. When you spend less than you earn and save the rest, you will build wealth — and savings — by default. And, if you just so happen to invest that money and avoid debt in the process, you can even grow rich over time.

But, there is definitely a balance to be achieved when it comes to spending less than you earn. You definitely want to hit your savings goals, but you have to live, too. And sometimes, finding a happy medium can be extremely hard — especially if you’re living frugally in order to save for a home or pay off soul-sucking credit card debt.

Know that you should invest in yourself, but just can't find the time? Well, you can, and the time is probably right in front of you …

Investing in yourself is important because no one cares about your success or your financial security as much as you do.

Businesses will just want your money. Your employer will just want as much work from you for as little money as possible. Community projects will run your life if you let them.

Basically, it's up to all of us to take charge of our own success. Finding the time outside of your normal job, family, community, and social commitments aren't always easy, but “free” time is a good place to look first. Free time isn't free; it ticks away just like any other time. It can be put to good use or frittered away. The choice is ours, and if we don't make the choice, others will.

My oldest son’s best friend very suddenly came down with a serious illness a couple of weeks ago. He has been in the hospital ever since, dealing with a surgery and then a number of post-surgery complications. I don’t even want to speculate as to what their medical bills will look like, even with good insurance.

At the same exact time, another friend of mine abruptly lost his job. It was a good paying job and one that seemed about as secure as a job could be, but his company abruptly ran out of money and closed their doors. He suspects that the company may have been in trouble for a while, but there was honestly little sign of it. Luckily, my friend is single, so there isn’t a spouse or children or other dependents to worry about, and he did have some savings built up for him to live on while he finds a new job.