Archive for January, 2008:
Have you seen this story in the LA Times?
I don’t know why Nathan Drake is smiling. His spending is out of control. It probably cost him his first marriage, and I don’t know if he realizes just how serious it is.
According to the story, Drake is spending $2,000 per month MORE than he makes. It’s easy to see how that will quickly become a problem.
He’s considering filing for bankruptcy, but the thing is, he’s not bankrupt. And, unless he changes his mentality, he will repeat this pattern of behavior.
Sure, he only nets $36,000 per year, and is in debt by about $52,000. That’s a mess, but it’s fixable, don’t you think?
From the story: "Only recently has frugality entered Drake’s budget. He moved from San Dimas to Whittier to cut his commute and save on gas. Because most of his cellphone use is for work, his employer agreed to cover his cellphone bills. And he and Jodi no longer dine out on crab legs."
Glad to hear they’re taking it easy on their dining.
He spends about $7,000 per year to maintain a pickup truck–a truck he "needs" so he can tow his share of a boat.
How about he sells the truck and sells his share of the boat? Clearly, he can’t afford either–so if he gives up both things (and gets a cheaper car and if he absolutely has to go boating…try renting one for a day)–he’ll quickly be able to get out of that mess.
That and if he stops using his credit cards.
That’s it! Not so hard, right?
Well, actually, it is hard.
It’s hard to change from a spendthrift mentality to a frugal one.
You’ll have to change your entire outlook on money, and life, actually.
He’ll have to go from thinking, "I deserve to have a boat and a truck to tow it" to "I deserve to be debt-free." Period.
He and his wife look like they’re taking some steps to improve their situation. After all, they’re seeing debt counselors and even agreed to be featured in the LA Times. That’s really putting yourself out there, and that takes guts.
I hope that he’ll be able to turn that
ship boat around (and sell it, though he doesn’t want to).
Sometimes, people will tell me, "I want to be frugal. I need to be–we’re living on one income and I have a lot of kids." But nothing changes. It’s just words that they say. One of those things that they need to do someday (some other day, though, not today).
What are you waiting for?
Are you waiting for a pay raise? Income tax refund? Lotto winnings?
Don’t wait for those things. You’ll end up spending the money before you even get it, and you’ll just be further in the hole, even though you’ll be bringing in more money.
Instead, make a plan for every dollar. Make a tangible plan to change your ways and get out of debt. It won’t be easy. If you’re heavily in debt, you’ll have to sacrifice for awhile.
But won’t it be worth it in the end? And, isn’t that feeling, that debt-free status, worth a whole lot more than some silly boat?
I love books. Always have. I regularly visit the library, and have a small personal collection of books. I like to use PaperBackSwap, and get used books whenever possible.
I’m a new member of MyPoints.com, and one offer that came through my inbox was points for signing up with a book-of-the-month club. I decided to look into it, just to see how expensive it would be. It’s quite costly.
Book of the Month Club
With Book of the Month Club, you select six books for $1, then have to buy four more books over the course of the next two years. Or, you could buy another book for $5.99 at the same time as your initial order and buy three books over the next two years.
Shipping and handling of the first item is $5.74; then each additional book in that order is $1.99 (overpriced!) plus tax. So, that initial order of seven books is looking like it will cost about $24.67 plus tax (I think). That’s about $3.50 per book, which isn’t terrible.
But, you’ll have to buy three more books to fulfill your membership obligation. From a quick sampling I took from available titles, you’re looking at $17-23 or so at regular price. If you choose three $17 books, that’s $51–not including shipping. If it’s $5.74 for the first item in your order, that’s $9.74 in shipping if you get all three books at once.
So, your total obligation will be at least $85 plus tax. That’s about $8.50 per book (including your books from your initial order).