Month: July 2019

The best cash back credit cards of 2019

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Advertiser Disclosure: I Will Teach You To Be Rich has partnered with CardRatings for our coverage of credit card products. I Will Teach You To Be Rich and CardRatings may receive a commission from card issuers.
Editorial Disclosure: Opinions, reviews, analyses & recommendations are the author’s alone, and have not been reviewed, endorsed or approved by any of these entities.

You know what’s awesome?

Free money.

With a cash back card, you get free money. That’s a hard deal to beat.

Take your current spending and pretend someone cut you a check for 1-5% of that spending. You don’t have to lift a finger or do anything, the check magically shows up in your account automatically. That’s what it’s like having a cash back card.

There’s really no catch either.

As long as you already pay your credit cards off every month, there’s no downside. To be honest, you shouldn’t be using credit cards if you don’t pay off your balance each month anyway. Every credit card is a terrible deal if you don’t.

For those of you that do pay off your cards every month, a cash back credit card is one of the best deals in personal finance.

Before breaking down the best cash back cards, let’s make sure a cash back card is the right type of credit card for you.

There are two types of rewards credit cards: travel cards and cash back cards.

We go into a lot of detail on how they differ from each other in our best rewards credit cards guide. The quick summary:

  • Get a travel credit card if you want to maximize the value of your rewards and perks
  • Get a cash back card if you want to maximize simplicity or your don’t travel

So what are the best cash back cards?

The best cash back cards

After scouring all the cash back offers out there, we’ve found these cards to be the best options:

How we evaluate cash back cards

For a card to make it on our list of best cards, we evaluated it using this criteria.

Bonus value

We don’t put much weight on the signup bonus. In fact, we ignore them for the most part.

Yes, the bonuses are great. Always take advantage of them.

But I never pick my credit cards based on the bonus itself. Since I never chase credit card promos or point hack by rotating credit cards quickly, I stick with the same set of cards for years. The rewards program, perks, and fees will all outlast the bonus. In the end, the bonus is a minor benefit.

Pick the card you want without worrying about the signup bonus.

Cash back system

This is the most important part of your cash back card. Sweat the details here.

Lots of cash back cards advertise amazing cash back rewards (get 5% cash back!) and then severely limit it with spend limits, rotating categories, or other nonsense.

As a general rule, the simpler the cash back program, the better. I’d much rather get 80% of the potential cash back if it means I never have to think about anything.

That said, if you’re trying to push your cash back rewards to the limit and are willing to take on the extra complexity, playing these games is the key to maximizing your rewards. It’s not how I personally want to spend my time, but if you do, all the power to you.


Keep a close eye on foreign transaction fees with cash back cards.

The best travel credit cards usually don’t have foreign transaction fees. That makes since they target travelers.

But cash back cards aren’t as generous. Many of them do have foreign transaction fees. This is a 1-3% fee on top of every transaction from a foreign bank. If you travel once per year, you could easily negate all your cash back rewards by paying hefty foreign transaction fees on your whole trip.

Otherwise, cash back cards don’t have many fees, and almost all of them don’t have an annual fee.

As long as you’re paying your card off every month (which you absolutely should be doing), you’ll be able to get your cash back rewards without ever having to pay a single fee.


As you pick your cards, keep an eye on how many banks you’re using.

Managing 2-3 logins across different banks isn’t a big deal but having a dozen or more logins starts to be a real headache. With a spouse and family, it’s surprisingly easy for bank accounts to get out of hand.

Whenever you’re trying to decide between two cards with similar offers, picking the option with a bank that you already use will help keep things simple. Not everything is about optimizing for every last dollar, simplicity and fewer headaches go a long way.

Bank reputation

At I Will Teach You To Be Rich, we have zero tolerance for banks that gouge customers on fees or treat customers poorly. Having a reliable bank is too important to put up with horrible treatment.

Unfortunately, Wells Fargo and Bank of America both have long histories of doing terrible things to their customers. We recommend avoiding them entirely. In fact, we didn’t even consider any cash back cards from either bank.

The best cash back credit cards

Here are all the cash back cards that you should consider.

Citi Double Cash

Highest cash back rewards that are super simple

This is our favorite overall cash back card.

You get 2% cash back on everything, which is a very good rewards rate. There aren’t any rotating categories or spend limits either. It’s truly as simple as it gets.

The only downside is the 3% foreign transaction fee. So definitely avoid using this card when traveling internationally.

Chase Freedom

The Chase Freedom is the best card for those willing to use rotating categories 

The 5% cash back is impressive. Each quarter, you’ll have a new spending category that gets the 5% cash back up to a certain limit. One quarter might be groceries, the next might be and Everything else gets 1% cash back.

I prefer to avoid rotating categories, I don’t want to spend the mental energy keeping track of this stuff.

But if you were trying to maximize the rewards from your cash back cards, having one rotating category card could be worth it. You’d only have one set of rotating rewards to worry about. That would give you a few simple rules for spending:

  • Check the new category once per quarter to see what gets the 5% bonus
  • Use the Chase Freedom card for that category
  • Use your default cash back card for all other spending

As long as you remember to check the rewards category each quarter, this is still a simple system to follow. I’m not going to do it, but I totally understand if you want to.

The 5% cash back does have a quarterly spending limit, usually about $1,500. So the cash back will be limited to about $75 per quarter.

This is very similar to the Discover it card, which we’ve included below. It’s basically the same offer. We recommend the Chase Freedom instead because it’s a Visa, which means it’s accepted at a lot more businesses than a Discover card.

Only consider this card if you’re willing to deal with the rotating categories.

Learn more about this card.

Chase Freedom Unlimited

The Chase Freedom Unlimited is a great card for the first year, then an average card after that

3% cash back up to $20,000 in card spending for the first year, then 1.5% after that.

No annual fee and no other complexities to worry about either.

This would be an amazing card if the 3% cash back on the first $20,000 in spending happened every year. But it doesn’t, you only get 3% during the first year.

It’s best to treat the 3% like a signup bonus and consider this card like a normal 1.5% cash back card. 1.5% is nice, but other cards have higher rates.

I’d look at other cards.

Learn more about this card.

Blue Cash Preferred Amex

An excellent secondary card to maximize specific spending categories

If I had two cash back cards, this would be one of them.

I’d use my Blue Cash Preferred Amex on all my transit, supermarket, gas station, and streaming subscriptions. That would allow me to get 3-6% cash back on all that spending. For everything else, I’d use a card like the Citi Double Cash which would then give me 2% cash back on everything else.

That’s a good way to maximize cash back rewards and still have a very simple set of credit cards.

The annual fee makes this card a bit more complicated though. Not only do we need to earn enough cash back to cover the fee, we also need to earn enough cash back to outweigh the standard 1-2% cash back rewards from any other card.

We could build a super fancy spreadsheet with rewards projections based on your annual budgets. Let’s skip all that. There’s a simple way to find out if Blue Cash Preferred Amex is worth it for you.

I’m going to assume that you spend about:

  • $50/month in streaming subscriptions. That’s $36/year cash back.
  • $100/month in taxis and other transit. That’s $36/year cash back.
  • $100/month in gas. That’s $36/year cash back.

Combined, you’ll get $108/year cash back which covers the annual fee.

Now, if you max out the 6% supermarket category with $6,000 in annual spending, you’ll get another $360 in cash back. That easily covers the opportunity cost of sticking with a straight 2% cash back card.

In other words, if you spend over $100/week at the grocery store, it’s worth getting this card as your second cash back card. You’ll max out the grocery benefit if you average $115/week in spending.

And if you spend more than $100/month in taxis or gas, this card gets even more valuable.

Terms Apply. Learn more about this card.

Capital One Quicksilver Rewards

The best cash back card for travelers

One thing to watch for on cash back cards is the foreign transaction fees. A lot of them have it, which adds 1-3% to any foreign transaction. If you travel internationally at all, you’ll want a card that doesn’t have it.

If you want to use a cash back card while traveling, the Capital One Quicksilver Cash Rewards is a great option. You get all the benefits of having a super simple cash back rewards program, an easy 1.5% cash back on everything, and no foreign transaction fees to worry about.

This also makes an excellent second card when paired with the Citi Double Cash card. Use the Citi Double Cash when in the U.S. to get 2% cash back on everything. Then use the Capital One Quicksilver when traveling to get 1.5% cash back and avoid foreign transaction fees.

Learn more about this card.

Discover it Cash Back

This only a good option if you want rotating categories and a Discover card

Full disclosure: I’m not a huge fan of Discover cards.

They get rejected at stores and restaurants all the time. I hate dealing with that hassle.

Not only is it a Discover card, it also has rotating categories. Like other rotating cash back cards, certain spending categories get 5% cash back while everything else gets 1%. And the categories rotate each quarter.

If you’re a big fan of Discover and want a card with rotating categories, this could be a good option.

But I wouldn’t choose this card myself. Dealing with Discover and the extra headaches or rotating categories is too much hassle for me. I’d choose any of the other cards on this list.

Learn more about this card.

Capital One SavorOne

The best cash back card for dining and entertainment purchases

With the 3% cash back on dining and entertainment, this card makes a great option as a secondary card to maximize your returns in that category.

If you eat out a lot or attend a lot of events, it’s definitely worth considering this card.

It also makes a great backup card for when you’re traveling, since it doesn’t have any foreign transaction fees.

Learn more about this card.

How to use multiple cash back cards to maximize your rewards

Honestly, you can get 80% of the potential cash back value from getting a single cash back card and using that card for everything.

To maximize simplicity, sticking to a single card really is a great move.

But what if you really want to get a couple of cards to maximize your cash back benefits? What does that system look like?

I’m going to walk you through a three-step system on how to build your cash back machine using multiple cards.

You will have to pay attention to a few spending categories and the rules will be a bit more complicated. But if you’re looking to maximize your cash back rewards, this is the simplest way to do it.

Step 1: Pick your default cash back card

Even if you plan on having multiple cards from the get-go, you want to start with your “default” card. This is the cash back card you’ll use for all purchases that don’t fall into any of the spending categories that we’re using other cards for.

For most folks, we highly recommend the Citi Double Cash card as your default cash back card.

The only downside is that the Citi Double Cash does have a 3% foreign transaction fee, which is pretty high.

If you travel regularly and don’t want a travel rewards card, consider using the Capital One Quicksilver as your default card. There’s no foreign transaction fee, and you’ll get 1.5% cash back on everything. It’s not quite as high as the 2% from the Citi Double Cash, but avoiding foreign transaction fees will easily cover the gap.

Step 2: Pick one maximization card

Now we get to have some fun.

It’s time to pick your maximization card. You’ll use this card only when you make purchases that take advantage of the increased cash back rewards in the categories for that card. For everything else, you’ll use your default card that you already picked during step one.

Depending on your personal spending, you have a few options.

Option 1: Blue Cash Preferred Amex for groceries and gas

If you spend $100/week on groceries, you’ll easily max out the benefits of this card. Start using it for your groceries, streaming, transit, and gas. Even with the annual fee, it’s a fantastic card for anyone that spends regularly in these categories. Terms apply. Learn more about this card.

Option 2: Capital One SavorOne for dining and entertainment

You’ll get 3% cash back on all dining and entertainment. I tend to eat out a lot, so this is a great fit for me. It also has a 2% cash back on groceries, but that doesn’t really matter if you get the Citi Double Cash as your default. You’ll already be getting 2% on every purchase. Learn more about this card.

Option 3: Chase Freedom for maxing returns with rotating categories

If you really want to maximize your cash back, you’ll need to get a card with rotating categories. This gets you a 5% cash back, but you have to deal with the headaches of remembering which categories are active. I would never do this myself, it’s too much trouble. But if you don’t mind remembering which categories have the 5% bonus, you’ll be able to maximize your cash back. Learn more about this card.

Also remember to watch the foreign transaction fees on cash back cards

When getting a second cash back card, try to get one card without foreign transaction fees. Then you’ll be covered whenever you travel internationally. The Capital SavorOne is a great option for this. You can use it for the 3% cash back on dining and entertainment when stateside, then use it for everything to get 1% cash back and avoid foreign transaction fees when traveling.

Step 3: Optional second maximization card

If you’re looking at the list of maximization cards above and having trouble picking between two of them because they both fit your spending really well, consider grabbing them both.

This would give you a total of three cash back cards. One is your default, the other two are maximization cards.

For example, let’s say that I spend hundreds of dollars every month on groceries, gas, dining, and entertainment. There would be a strong case for me getting three cash back cards:

  1. Citi Double Cash as my default card
  2. Blue Cash Amex for my groceries and gas
  3. Capital One SavorOne for dining and entertainment

This setup would allow me to maximize my cash back across several spending categories. I’d have 2% cash back as my default and 3-6% across a few categories. That’s a really nice return with a cash back machine that’s still simple enough to remember.

Should you ever consider more than three cash back cards?

I strongly advise against it.

You could get more than three and it won’t hurt you. 

But I consider it completely unnecessary.

After three cards, any additional cards will have diminishing returns. They become more trouble than they’re worth.

Definitely get a default cash back card, get a second if you want to bump your returns, consider a third if your personal spending fits multiple cards, and don’t go past that.

Advertiser Disclosure: I Will Teach You To Be Rich has partnered with CardRatings for our coverage of credit card products. I Will Teach You To Be Rich and CardRatings may receive a commission from card issuers.

The best cash back credit cards of 2019 is a post from: I Will Teach You To Be Rich.

Should We Employ Our Own Kids? (and How Much to Pay Them)

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My Brother Wax Mannequin, training the next generation of workforce last summer.

Way back in 2015, I had a nine year old boy. Even back then, I could see him showing some early flashes of adulthood and maturity, and it got me wondering about his future as it relates to money and freedom.

So I wrote a post called What I’m Teaching My Son About Money, which shared some ideas about how we can raise our next generation of kids to be happy masters of money rather than the stressed-out slaves that most people (even those with high incomes) are today. And now, four years later, some of my predictions and questions from that article are starting to come true, and I’m wondering what to do about it.

To me, the biggest question is this:

Where is the balance between giving your kids a helpful boost, and “helping” them so much that you distort their view of the world and create a generation of Whining Complainypants Adults?

Opinions on this subject can vary widely, and in fact even you and I might have rather different views. But hopefully we can at least agree that the whole thing sits on a spectrum, and that even that spectrum itself is slippery because every child and every upbringing is unique.

So let’s get onto the same page with an attractive and scientific-looking diagram.

Almost any parent would agree that the left side of the spectrum is a bad place for kids to be born. Because it affects not just their childhoods, but their entire lives. So we strive to provide a life that is further to the right, keeping our kids fueled with food, love, and opportunities.

But as with all human pursuits, we have a tendency to go too far and get into the “Too Easy” end of the spectrum. We may be smothering our kids with too much “help”, or perhaps compensating for being so busy with our fancypants careers that we don’t have much time to spend with them.

While this all feels like common sense, there’s also some biology behind it. Babies and young kids who experience a harsh environment during this critical part of development will tend to grow up more optimized for survival and street smarts, with lower levels of trust and a harder time blending in with a peaceful society*.

And on the more fortunate side of the divide, children raised in peace and security will optimize more for “book smarts” intelligence as well as being more trusting and less prone to violence. The entire apparatus of our brain will end up wired differently, based on the experiences we have in early childhood.

The problem for wealthy people is that the human brain is not wired to stop at “enough”, because enough has not been a big part of our shared history.

So we tend to overdo it when creating a comfortable life for our own kids, often justifying it with this exact sentence:

“We work hard, so we can give our kids some of the opportunities and the nice things that we didn’t have in our own childhood.”

It sounds noble and honorable on the surface, but be careful, because we can ratchet that same justification up far beyond any reasonable lifestyles without realizing we are just stoking our own egos or compensating for our own fears (and perhaps battling our peers/competitors in the Who’s-the-Best-Parent Competition on Facebook).

And then these kids respond by developing in a different way that can have its own downsides. Not understanding what it means to be poor. A lack of life’s most valuable skill – the skill of efficiency, optimization and reducing waste. And even a lack of life satisfaction and balance in later adulthood, because of a focus on easy consumption rather than the joy of creation.

So with such a slippery slope and those two pointy arrowheads to navigate, what’s the ideal strategy for us parents?

I don’t have all the answers, but one idea I have been interested in for years seems to have a lot of advantages: Hiring your children to work in your own small business.

Just think about it. You get to do all of these things and more:

  • help your kids earn their own money
  • teach them the value of hard work
  • have more excuses to spend time together solving problems – maybe even as they grow into adults
  • potentially cut the family’s total tax bill by transferring income from the high tax bracket of the parents, to the low (or zero) bracket of the kids.

Of course, there are also a few traps to watch out for in running a family business:

  • the job you give them might be better (or worse) than what they could get elsewhere, leading to a distorted view of what it really means to work for a living
  • if you don’t get along particularly well, tying your fates together even closer in a company will magnify any problems in your relationship
  • your kids might miss out on other, broader life experiences they could have had out there in the real world (like my own formative jobs in the gas stations and convenience stores of my small town, which are still the source of stories and laughs to this day.)

Still, the potential benefits clearly outweigh the risks to me, so the idea remains an exciting one in my mind.

Little MM and the Budding YouTube Project

I have been dabbling with this with my own son for several years – he helped me with the arduous task of mailing out over 1200 MMM T-shirts a few years ago and occasionally helps his mother in her soap production enterprises. His earnings have typically been on a per-shirt or per-soap basis

But things really took a step up this past January when he talked me into dusting off the neglected MMM YouTube Channel and actually starting to produce some shows together. Because we started with the good luck of a partially established audience and we have put some real effort into it (13 episodes over these first six months), it has taken off a little bit and we now have over 27,000 subscribers and the channel has earned about $1600 in YouTube ad revenue so far.

As a fun incentive, I offered at the beginning to pay him a flat (low) fee for editing and producing each episode, then split the income from this venture equally beyond that. So now, the little dude has made $800 on top of his base fees for the work.

If this continues, it could grow into a real income, which is quite exciting but also brings up some interesting tax questions. After all, right now he is a dependent for tax purposes, which means at least one of his parents get a tax deduction for raising him. But if he earns his own money, he might rise out of this dependence and even start owing taxes on his own. So is it worth it?

Hey, Let’s Ask my Accountant!

Outsourcing my taxes to someone younger and more enthusiastic about it than me has worked wonders.

To get better advice, I decided to run this by my own business and personal tax accountant, Chris Care who runs his own firm called Care CPA. We talked over the ideas of family businesses and employing a child in greater detail.

In summary, the results are better than I expected, which explains why people are so keen to hire their children.

Here’s my brief Q&A with him. Thanks for your help Chris!

MMM – So the first question is, what are the basic rules about employing one’s own child in a family business. My first instinct is that it sounds smart, because you are shifting income from parents in a potentially high tax bracket, to kids in a low tax bracket. So overall as a family, your tax bill falls.

But Is it a good idea? How old do they have to be? Any things to watch out for?

Chris Care: The biggest thing to watch out for is making sure the children are old enough to actually work. A lot of business owners want to pay their 1-year-old $15,000 a year for “modeling” by putting their picture on the company website. To me, this is a stretch.

You also want to make sure you’re paying them in accordance with the tasks they’re doing. If they are 12 years old and filing paperwork for you, or cleaning your office, or other administrative tasks, you probably can’t justify paying them $50 an hour. You should make sure there is a clear job description, and keep an accurate record of the number of hours worked and the tasks performed, just like any other employee does at their job

MMM –  What is the current child tax credit amount, and how would it phase out if he started making his own money? And does this scale up and down with the parents income as well?

Chris Care – Currently, the child tax credit is up to $2,000 per child, with up to $1,400 being refundable if the credit exceeds your tax amount.

In general, as long as you can claim the child as a dependent, and your income is below $400k if married filing jointly ($200k otherwise), you can claim the child tax credit no matter how much money your child makes. Above this income, the child tax credit phases out, but it is still not related to the child’s own income.

MMM –  Oh wow, I didn’t realize that. And at what level would he need to start incurring his own income taxes? And as an employer, would I be on the hook for stuff like quarterly tax payments, unemployment insurance, worker compensation, and so on? Could he be more like a contractor and avoid these complexities?

Chris Care – It’s unlikely you could classify your own son as a contractor. The IRS used to have a 20-factor test, but recently they have been narrowing and cracking down on this issue – more details here: Behavior, Financial, and Type of Relationship

Aside from that, you’d have to handle things in the standard employee way:

  •  tax withholding from every paycheck, submitted to the government as part of a standard payroll process. (MMM Note – even I have to do this as an employee of my own LLC, I use a provider called ADP and am evaluating a newer one called Gusto).
  • quarterly payroll taxes for social security and medicare
  • State unemployment insurance if applicable in your state
  • FUTA (A form of Federal Unemployment Tax)

Just like any other taxpayer, the child will need to file a federal tax return if their earned income is above the standard deduction ($12,000 for 2018, and $12,200 for 2019). Note that state filing thresholds are often much lower than federal thresholds – check with your own accountant!

MMM –  If a kid is living at home with no expenses, he might be wise to put as much of this into retirement accounts and otherwise defer taxes. If my company offered an employee 401k plan, could he put away the full $19,000 per year, or is there an even better option? Maybe his own tax-deferred college savings plan?

Chris Care – As with any other employee, the child can participate in the company’s retirement plan, as long as the plan is written to allow minors to participate. The contribution limits will depend on the type of retirement plan. In your example of a 401k, the child could defer the full employee amount ($19,000 in 2019) as long as wages were at least that amount. He would also get the employer match if your company established one.

College savings plans are an option, though whether or not he can open his own would be a question for your specific provider. Financial service firms tend to get a little hesitant opening accounts for minors. You could always open one, and he could contribute to it.

MMM Summary: Wow, this is much better than I had even hoped. In rough terms terms, it sounds like if I can pay my son $30k from my company’s income, I might save about $10k in marginal income taxes, while his resulting tax bill would be quite minimal.

Thus, it makes sense for me to start paying him as a real employee, rather than just paying all the taxes at my own marginal rate and keeping it in our own family spreadsheet, as I do now. 

Chris Care – Yes, there are some good opportunities for tax optimization by hiring kids.

In general, if you can justifiably pay your child a wage from the family business, it is an excellent way to lower the family’s tax burden, and give them a massive boost in retirement savings (since 401k contributions add up way faster than IRA contributions).

Also, by owning the business, you can administer your own 401k plan – which means you don’t have to wonder if your employer’s plan will allow for a mega backdoor Roth, since you can design it that way! Just keep in mind, that 401k plan is for all employees, so any attributes you establish for family members would also be there for non-family members that you may hire.

Another optimization: if you were a sole proprietorship, or a partnership where both partners are parents of the child being employed, the child’s wages would not even be subject to SS/Medicare taxes.

This means you could pay them the $12,000 standard deduction plus $19,000 401k deferral, with zero income tax, zero SS/Medicare taxes, and zero Federal Unemployment tax. They may still be subject to state income tax and state unemployment tax, but those would be relatively minor.

You can essentially shove $31k into a zero tax situation, from potentially a ~35% situation.
This means it may be worth operating the youtube channel as a separate company, and employing your son as a real employee…

MMM – hmmm, lots to consider! For now, YouTube is still only a few hundred bucks per month so we are not there yet. But it sounds like little MM’s future is bright, as long as he remains motivated to work hard and be creative and keep producing.

Which is a good general philosophy for any of us: keep some good hard work as part of every day, whether you’re ten or one hundred years old. Doing good work and producing good things tends to lead to a good life.

A Few More Thoughts and Disclaimers from Mr. Care:

  • In all of these answers, I have assumed the child is a true employee, where he receives a regular paycheck and a W-2 at the end of the year, and the company is a C Corp or S Corp.
  • As with all tax planning, tax credits, and personal situations, there are exceptions and limitations. So we’ve made some broad assumptions to answer these questions. For me to post an exhaustive list of these would take an entire blog post of its own. Always check with your tax professional, or make sure you understand the IRS guidance.
  • generational wealth / inequality / dynasties / buffett
  • effective altruism

A Final Thought from MMM:

If all this sounds like wishful thinking to you because you don’t own your own business yet, I strongly encourage to start one! For the great majority of early retirees, having a small entrepreneurial pursuit is both a reassuring security blanket and a fascinating and fun way to explore life after the cubicles and commuting stage is over. The Joy Of Self Employment.

* This one of many interesting and sometimes untintuitive insights I got into Human nature when reading the rather excellent book Sapiens.


My plan for purchasing a new car

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Build Your Own MiniIt’s funny. Fifteen years ago, daily personal finance was a chore for me. I didn’t understand how to go day to day making smart choices that were aligned with my values. I wasn’t even sure what my values were!

Today, things are much easier. Sure, there are challenges. Sometimes I make poor choices. But mostly, what I spend aligns with what I want out of life. (With the caveat, of course, that who I am and what I want shifts over time.)

I’m glad I’ve developed good habits. Right now, it’s keeping me from making a rash decision. For most of 2019, Kim and I have both been fighting the new-car itch. The old J.D. would have succumbed by now. This year’s model still does dumb things like spending hours building custom cars on the Mini website, but so far I’m not scratching that new-car itch.

Instead, I’ve come up with a plan, a path to a car purchase. And Kim has come up with a plan of her own too.

My Plan for Purchasing a New Car

“Look at this,” I told Kim a couple of weeks ago. I carried my laptop over to show her my latest Mini design: a super-powered orange convertible that makes no sense for our lives.

Kim shook her head. “You’ve got to stop going to the Mini website,” she said. “And you especially have to stop using that build-your-own-car tool. That’s dangerous.” She’s right.

Earlier this week, as Tally and I strolled through the hills and picked blackberries, I did some serious thinking about if/when I should get a new car. I think I’ve gained some clarity.

Sure, if I cashed out some of my investments, I could justify making this purchase today. But, as I learned last year, this sort of action carries a huge tax consequence. If I sold investments to buy the car, I’d effectively be paying a 15% premium to make the purchase. I’m not willing to do this.

Plus, it’s hard for me to rationalize paying so much for a new car. It’s crazy how expensive vehicles are these days. (Do I sound like an old man yet?)

Speaking of being an old man: The one thing that even allows me to consider a new new car is that I’m getting older. I’m fifty. It’s highly probable that if I purchased a new vehicle, it’d be the last new-vehicle purchase of my life. (I tend to keep my cars a long time. I can see that at 67 or 70, I’d buy another used car because a new Mini would last me until then.)

While the dog sniffed the roadside for rabbits, I formulated an actual plan for buying a new car. I decided that there are three conditions that would lead me to make this purchase. From least likely to most likely, those conditions are:

  • Interest rates on auto loans drop low enough for me to justify making payments. As I said, I don’t want to cash out my investments to buy a car. My monthly income has reached a level where I could conceivably use part of it to pay for a car, but I don’t want to pay a lot of interest if I do. Right now, the U.S. national average for a 60-month loan is 4.21%. That’s too high. 0.0% would be low enough, obviously. But at what level would I be willing to take out a loan? I’m not sure. I think 2% may be too high, but 1% is okay.
  • My current Mini Cooper dies. My car has had a couple of major repairs since 2016, but mostly it runs fine. There’s no rush to replace it. But if it were totaled in an accident (heaven forbid!) or if something else major were to go wrong, well then I’d consider moving on to a new car.
  • I save enough to pay cash for all (or most) of a new vehicle. GRS is starting to make more money. Not a lot — not like in the olden days — but some. I plan to set this aside in a car fund. Meanwhile, whenever I get lump sums, I’ll stick that money in the car fund too. (I’m negotiating a project that might give me roughly $15,000 — if it ever happens.)

If any one of these three comes to fruition, I’ll do pull the trigger. I’ll buy a new car. (Unless, of course, I manage to shake this new-car itch for good. But that’s unlikely.) In the meantime, I’ll make do with the two vehicles I already own: my 2004 Mini Cooper and my 1993 Toyota truck. I like them both and they run well. They’re good enough, you know?

If I could could MINI to sponsor Get Rich Slowly, I could make a fortune, couldn’t I? I give them enough free advertising as it is…

Kim’s Plan for Purchasing a New Car

Meanwhile, Kim is fighting a similar battle. As much as she cautions me to quit making mock-ups of my dream car, I often walk into the living room to find that she’s browsing Craigslist or the Toyota site, looking wistfully at RAV4s.

Last weekend, we spent Sunday evening in downtown Portland for dinner and a Timbers game. As we walked around, she pointed out various compact SUVs. “That one’s cute,” she said, pointing at a Subaru of some sort. “I like that color. What model is that? Do you think that’s a 2017?”

Between the two of us, we agree that we should have one practical vehicle and one fun vehicle. Our definitions of “practical” and “fun” aren’t exactly the same — I’d never buy an SUV, and she wouldn’t buy another Mini — but they’re close enough. Kim has decided that she’s the one who’ll pursue practical. For her, that means a compact SUV.

After I told her about my plan for a new purchase, I asked if she had a plan.

“Well, I’m further along in the process than you are,” she said. “You don’t have anything saved for a car. I do. I have $15,000. And if I can sell that stupid motorcycle, I should have another $3500. Once I have $20,000 in my Ally account, I’ll buy a car.” (Kim loves her Ally savings account. I’m not kidding. She’s like a walking, talking ad for Ally — just like I’m an ad for Mini. It’s hilarious.)

“You’re close,” I said.

“I know,” she said. “That’s why I’ve been looking at cars. I want to find out what’s available and how much things cost. Yesterday, I called three local dealerships to ask when the 2019 models will go on close-out. They said they’d call me back in a few months. I hope I have enough saved by then.”

So, Kim’s plan is simple: Once she has $20,000 saved, she’ll buy a compact SUV. If she can afford a new one and can find one she likes, she’ll buy it. Else, she’ll buy a recent used model.

In addition, she prefers:

  • A hybrid or electric vehicle.
  • The ability to tow a trailer (although we don’t own one).
  • The ability to carry two kayaks (which we do own but don’t use because we have no way to get them to the river).
  • Low road noise.
  • The ability to listen to podcasts.
  • Good visibility all the way around.

I think she’s going to be surprised when it comes time to buy. I think any modern SUV is going to satisfy her list of requirements. And based on her progress, I’m guessing that sometime this autum or winter, we’ll be visting car dealerships to test-drive cars.

Second Thoughts

I know this is the second (third?) time I’ve written about this same subject in six months. That’s because our car situation is taking up a lot of our brainwidth lately. It’ll continue to do so until we have some sort of resolution.

I have no doubt that by this time next year, either Kim or I — or both of us — will own a new car. But I’m pleased that we’ve both resisted the urge to rush out and make a purchase before we’re ready. We’re taking the time to research what we want (well, Kim is, I guess — I’m just building custom Minis), and we’ve both formulated plans to save for the purchase.

In the meantime, I should thank all of the GRS readers who have left comments (or sent me email) with tips for getting better deals. (My favorite? Find a part of the U.S. where my chosen car sells poorly. Buy the car there for less, then drive it back to Portland.)

There’s a little voice inside my head that says, “J.D., you shouldn’t even buy a new car. You don’t value cars enough to justify a new one. Just keep buying used vehicles. Look how much you love your 1993 pickup. It only cost $1900!”

That little voice has a valid point. Plus, I don’t drive much. I drive maybe three times per week for a total of sixty miles. I make several longer trips each year, though. I’d guess my average annual driving is around 3000 miles.

Wait! I can figure this out! We’ve been back from our RV trip for just over three years. I know what my end-of-trip mileage was on the Mini. Let me go see what the current mileage is…

In the 1114 days since getting home, I’ve driven my Mini 14,601 miles. That’s an average of 13.1 miles per day (or 92 miles per week), which works out to 393 miles per month (or 4718 miles per year).

Does it even make sense to buy a new car if I’m only going to drive it 5000 miles per year? I don’t know. I suspect not. That’s why the rational J.D. says, “Buy used.” Or maybe I could do what my buddy Rob Farrington does: Give up car ownership altogether and just use ridesharing.

p.s. Just after publishing this, I read a great article at A Wealth of Common Sense: The Thing That’s Probably Blowing a Hole in Your Budget. Ben Carlson notes that the three largest debts in most people’s lives are a mortgage, college loans, and car loans. The first two can be rationalized, even for folks who are struggling financially. A new car loan, on the other hand, is tougher to argue. If you’re in good financial shape, fine. But if you’re not, you shouldn’t be borrowing $50,000 to buy a new truck. (See also: Why your luxury car is unlikely to materially boost your happiness.)

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A self-made man

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Dad at the LatheMy father died twenty-four years ago today.

As I drove to the airport this morning — I’m on a short trip to San Diego — my mind drifted back to him and what he was like.

I don’t think of Dad often anymore, and when I do it’s mostly superficial stuff: Dad was fat. His hair was wild and wavy. He could be gruff. He was funny and had a contagious laugh. Sometimes he wasn’t a very nice guy. Sometimes he was. But it’s tough to remember what Dad was like as a presence, you know?

What I remember most about him was how Dad could do anything he set his mind to. This isn’t nostalgic hero worship. It’s how he actually was. My father could teach himself to do anything he wanted. And he wanted to do a lot.

A Self-Made Man

I’m not sure where my father’s love of learning and experimenting came from. His parents were a simple, devout Mennonite couple.

When I knew Grandma and Grandpa, they managed a small farm. They had milk cows. They raised blueberries. They grew and canned vegetables. Grandpa cut his own wood. He’d been a janitor at the local high school, but by the time I was around, he was retired. Every night, he and Grandma sipped Sanka and played Scrabble. Their existence was simple, ordered, and serene.

My father wasn’t simple. His life wasn’t ordered. He was not a serene man. He was complex. He was messy. He was boisterous. He was a force of nature. (I come by my ADD honestly.) He had many interests, and he liked to indulge them all.

  • Dad wanted to be a pilot, so he took flying lessons. In his twenties, he became a flight instructor at a small local airpot. When my brothers and I were young, he’d sometimes take one of us on a joy ride to Salem or Eugene. He stopped flying, though, after crashing his Cessna while practicing touch-and-go landings in the field behind our trailer house.
  • Dad wanted to sail solo to Hawaii. Throughout the 26 years that I knew him, he nearly always owned a sailboat. (The only times he didn’t were when our family was mired deepest in poverty.) When I was very young, he built his own sailboat following instructions in borrowed library books. My family didn’t travel for family vacations; my parents took us sailing down (and up) the Columbia River.
  • Dad loved electronics. He built a lot of his own gadgets, designing and soldering circuit boards. When I was old enough, he helped me build a radio so that I could listen to Portland Timbers games and old-time radio dramas on local stations.

Dad built other stuff too. He built so much stuff that projects were often abandoned half-finished.

He ground mirrors to build his own telescope — then left them lying around in a bedroom drawer for years. He constructed a windmill, but something about his math was off and the thing collapsed from the weight of the canvas sails when he tried to mount them. He constructed outbuildings on our two acres, and then built an addition to the back of the trailer house — an addition that was never really completed.

In high school, I took over Dad’s car — a 1982 Datsun 310GX. (Looking back, I’m not sure how this happened but it did.) The car “blew a head gasket” one day. Rather than pay a mechanic to repair it, Dad tore the engine apart himself, found and fixed the problem, then re-assembled everything. He taught me how to change the oil and the brake pads and the headlights…but there’s no way I could ever pull apart an engine!

When personal computers became “affordable” in 1977 — looking back, they were the equivalent of $11,000 in today’s dollars! — Dad bought one and taught himself to program it. (And I taught myself to program it too.)

My father could play guitar, fly an airplane, sail a boat, build a boat, build a computer, program a computer, build a radio, build a greenhouse, build a house, repair an engine, write fiction and poetry, build complex machinery, build a telescope, start a business (or six), and more. And he taught himself how to do almost all of these things.

A Serial Entrepreneur

As I’ve mentioned before, my father was a serial entrepreneur. He was always starting businesses.

He programmed accounting software but could never find anyone to buy it. (It was 1980, I think. He was a few years too early.) He built a greenhouse complete with automated watering system, then tried to start a nursery. Nobody wanted to buy his azalea and arborvitae. He mowed lawns. He sold chocolate bars.

Most of his business ventures failed, but twice he hit paydirt.

First, he built a business called Harvest Mills, which first manufactured wheat grinders, then added food dryers to the line-up.

Little Harvey

In 1985, eight years after he sold Harvest Mills, Dad founded Custom Box Service, a company that produces small runs of corrugated packaging. Dad designed and built all of the machinery himself. Those machines have been in constant use for thirty-three years. They haven’t been completely trouble-free, but come on! These are machines created by a random guy from rural Oregon. That’s pretty amazing.

A Modern Homesteader

When I was in second grade, my parents decided they wanted to move to Canada. For once, they were flush with money. My father had sold Harvest Mills to a bankruptcy attorney in Utah and was to be paid $5000 every three months for the next fifteen years.

When Dad had money, he liked to spend it. If he had money, he’d buy a sailboat. Or an airplane. Or a hi-fi stereo. Or a personal computer.

This time was no different. This time, though, he wanted to use the money to buy twenty (or forty) acres in rural British Columbia. I don’t know why. (He was always afraid of nuclear war, though, so this could very well have been a way to escape the “blast zone”.)

Vanderhoof, British Columbia

Mom and Dad piled us three kids into one of our two beat-up Plymouth Valiants — we called one “dirty white” and the other “dirty red” — and drove us fourteen hours north to Vanderhoof, a small town that’s pretty much what you’d expect to find in central B.C. so close to Alaska. There, we spent a long weekend in real-estate offices and visiting properties.

I remember driving down dirt roads and strolling along swollen streams. I remember wandering around farmyards. I remember watching a war movie in our hotel room. But I don’t remember any of the houses we visited, and I don’t remember why we never moved. My guess is that Dad didn’t have as much money as he thought he did. Or perhaps Mom had objections to moving to the middle of nowhere?

Instead, he bought twenty or forty acres near the trailer house and tried his hand at being a wheat farmer. It was hot and dirty work, but it was another thing that he could teach himself to master. Unfortunately, he had no way to master the national economy, which didn’t have a high demand for wheat when it came time to sell. He abandoned that venture too.

An Inspiration

One of my favorite exercises is trying to trace a financial family tree. What did my parents teach me about money? What attitudes did I get from them? What habits? And what did their parents pass onto them? Did I get anything from that generation?

Dad was self-reliant…and he wasn’t. He could do almost anything…but he seldom did. He was a dreamer…but he rarely pursued his dreams.

For many years, I thought of myself as “not like Dad”. I don’t know if this was a conscious decision or if I simply believed that I was different. In any event, I didn’t think of myself as a DIY guy. I couldn’t build a windmill or a sailboat or a telescope. I couldn’t repair an automobile engine.

In recent years, however, I’ve been very aware of just how much I picked up from my father, how much he influenced my money blueprint. I can see where I got many of my ideas and habits and values.

I’m intellectually curious. I’m entrepreneurial. I love travel and adventure. I’m drawn to the idea of living somewhere remote — just me and Kim and our zoo. And lately I’m learning to love DIY.

The older I get, the more I see my father in me.

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The power of focus: Why you should tackle one goal at a time

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I used to be the sort of guy who loved to have a list of goals. At least once a year — usually around New Year — I’d sit down and make a list of all the things that were wrong with me, all of the things I wanted to change.

In 2007, for instance, I made a list of 101 things I wanted to accomplish in 1001 days. (It took me longer than three years to finish that list, by the way. In fact, I still haven’t done everything on it because my priorities have changed. But now, ten years later, I see that I have completed nearly all of the ones that still matter.)

Eventually I realized that making a long lists of resolutions is a sure path to disappointment — at least for me. There’s a reason you see newspaper and TV stories every spring about how most people aren’t able to maintain the resolutions they set at the first of the year. It’s because most of us try to do too much. (And, I think, because we try to set goals that aren’t truly aligned with our primary purpose in life.)

Nowadays, I do something different, something that’s actually proven to be successful. Instead of trying to change many things at once, I’ve learned to change only one thing at a time.

One Thing at a Time

In 2010, for instance, I focused on fitness. In fact, I dubbed 2010 “The Year of Fitness”. My aim was to lose fifty pounds. Every decision I made, I made with that goal in mind. You know what? It worked. Though I didn’t lose fifty pounds that year, I did lose forty. (And I lost the final ten by the middle of 2011.)

[Weight Loss Progress]

I was able to do this because for the entire year, my only goal was to get in shape. I was focused. Nothing else mattered. I didn’t have any other big goals clouding my view or competing for my attention. I set one goal, and I worked hard to meet it.

In 2011, my one goal was to learn Spanish. And I did it. Three times a week, I paid a Spanish tutor for ninety minutes of personal instruction. In my spare time, I watched Spanish movies and listend to Spanish music. I read Spanish books. I consumed Spanish podcasts. Within a year, I’d achieved reasonable fluency in the language. I could carry on converstations in South America, and I could read Spanish-language novels. (Though not all Spanish-language novels.)

In 2012, I tried something a little different. Instead of one big goal for the year, I chose to work on one goal each month. Some examples:

  • In March, I had lunch or dinner with a different friend every day. This let me reconnect with people I’d been missing.
  • In April, I embarked upon my Extreme Dating Project. I’d just been divorced, and my goal was to meet as many women as possible. (April was a fun month! And it led to my current relationship with Kim.)
  • Next, my goal became to make it to the gym every day in May. I didn’t quite succeed — I only worked out 28 out of 31 days — but I came close.
  • My next goal was “no junk in June”. I focused on my diet, which helped me lose five pounds and two percent body fat.

Sometimes I spend a year on any given goal. Sometimes, I spend a month. And sometimes I spend even longer! After Kim and I decided we wanted to take an RV trip across the United States, for instance, I spent the next eighteen months devoted to that project.

During the first part of 2015, we shopped for and purchased a motorhome, then prepped it for life on the road. We left Portland on 25 March 2015 and spent the next six months exploring the U.S. We paused for six months in Savannah, Georgia, before beginning our homeward journey this time last year. On 29 June 2016, we made it back to Portland. We had a blast — because for those eighteen months, we were committed to one thing and one thing only.

You get the idea. At any given time, I’m concerned with only one major goal.

One Problem, One Correction

My friend (and personal trainer) Cody espouses the “one thing at a time” philosophy when he works with clients at his gym. Here’s how he describes his approach:

One of the teaching skills that is developed in good coaches is the concept of “one fault, one correction”. The idea is to take the most important correction needed and just focus on that one thing. Attack it from different angles if needed, but be tenacious on correcting the biggest fault only. Once that has been achieved, the Coach and Athlete can move on to the next biggest fault, then the next and so on, in a never-ending journey toward excellence.

Cody says that by focusing on one thing at a time, you can:

  • Obtain greater focus. When you try to correct more than one thing at once, it’s easy to become distracted. You can’t do any one thing well because you’re trying to do many things poorly. But if you concentrate on a single goal, you’re able to obtain a laser-like focus that better helps you achieve that objective.
  • Reduce stress. If tackle too much at once, it’s easy to feel overwhelmed. It seems like you’ll never get it all done. When you focus on one thing at a time, you know that’s the only thing you have to worry about. This relieves a lot of pressure.
  • Build confidence. “Honing in on one challenge and overcoming it can give you a tremendous feeling of success,” Cody says. This boosts your belief that you can overcome other obstacles. When you kick ass on your first goal, you know you can kick ass on the next one.

Cody puts this philosophy into practice every day in the gym. He uses it when coaching me on squats, for example. When I started at his gym, my form was awful. I couldn’t do an actual squat — not even without weight. By correcting one thing at a time, I made great progress. (At my peak, I could backsquat 245 pounds, which was 150% of my body weight!)

The myth of multitasking and the magic of single-tasking are well known. Study after study after study has demonstrated that when we try to do more than one thing at once, quality and quantity both suffer. It’s much better to finish one thing before tackling a second. (Did you know that those who claim they’re best at multi-tasking are actually worst? It’s true!)

Exercise: Here’s one of my favorite demonstrations of how multitasking hinders rather than helps. Grab a pen, a piece of paper, and a stopwatch. First, time yourself as you write the alphabet from A to Z followed by the numbers 1 to 26. Next, time yourself as you alternate between writing the letters and numbers, putting them each in their respective columns (or rows): “A 1 B 2 C 3”. When I tried this just now, it took me 30.49 seconds to complete the first pass (with no errors). It took me 43.57 seconds to complete the second pass (with one error — I wrote F instead of 5.)

In his book The ONE Thing, entrepreneur Gary Keller advocates relentless focus on a single goal at a time. Specifically, he recommends asking yourself this question: “What’s the one thing I can do such that by doing it everything else will be easier or unnecessary?

Keller writes, “Extraordinary results are directly determined by how narrow you can make your focus…You need to be doing fewer things for more effect instead of doing more things with side effects.”

The Bottom Line

I’ve been using the “one thing at a time” approach for more than seven years now. It’s made me happier and more productive. And it’s because of this success that I’ve become such a huge advocate for creating a personal mission statement. When you have a single over-arching purpose, it’s so much easier to prioritize the other things in your life.

But I want to point out that I’m not advocating slavish devotion to your one goal. Not at all. While you’re pursuing fitness or learning Spanish or traveling the country in an RV, there’s still time to work on other areas of your life. And you should constantly strive toward holistic personal growth.

What I’m advocating is choosing one thing that takes priority over all other things, and then sticking to that until you meet your objective. If your aim is to achieve a certain weight or — better yet — to develop a fitness routine, then make sure that is the one thing that never gets pushed aside for other priorities.

Also note that the one thing that’s most important to you this year or this month or this week might be different from your personal mission. Or it might be some small subset of that larger goal. My personal mission is all about personal growth and exploration. But this month, my primary aim is to reduce my alcohol consumption. My aim for next month is to — finally! — complete the Get Rich Slowly redesign.

Lastly, I should note that although I’ve found this strategy effective and I’m writing an entire article advocating it to you, the reader, I still sometimes forget to use it.

One reason I suffered from anxiety this spring is that I had forgotten my own advice to tackle one major goal at a time. I was trying to do too much. My therapist helped me to see that I had unrealistic expectations for myself and that I needed to dial back my ambition.

“Oh yeah,” I thought. “One thing at a time. I need to focus on one thing at a time.” So I am.

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Twenty Common Items That See a Second Life in Our Home

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We make an effort to minimize the trash we throw away, for a number of reasons. Obviously, it’s beneficial for the environment to recycle as much as possible and find other uses for things (reduce, reuse, recycle), but the truth is that a lot of stuff that might otherwise find their way into the trash actually has some good second-time-around uses.

Here are twenty (or so) common items from around our house that you might expect to get thrown away but often finds a pretty useful second life in our home.

Glass bottles If these have easily resealable caps, we’ll use them to store homemade beverages like cider or kombucha. I have an array of different bottles that we use for these purposes. If it’s a nice bottle without a resealable cap, we’ll often save it and use it as a vase for a while.

Dryer lint, egg cartons, and candle remnants We take these three items and turn them into fire starters. They’re really great at getting a campfire or a small fire in our backyard fire pit going.

Just take the empty egg carton and stuff a bunch of dryer lint into each well. Melt the remnant candle wax together, then pour it into each well in the egg carton until there’s a sufficient amount to hold the dryer lint firmly in place. Let it dry.

Then, when you need to get a fire going, tear off one of the wells from the carton and light the paper end of it with your lighter or match of choice. This little ball of paper, wax, and lint will burn very hot for several minutes, giving you plenty of time to get twigs or kindling burning and thus giving you a nice start on your fire.

Cereal boxes This doesn’t happen nearly as often as it once did now that Sarah and I aren’t subscribed to any magazines, but we would often take cereal boxes, cut off the top and a bit of the sides, and convert them into magazine holders. It’s a great way to keep magazines organized on a shelf and makes it easy to pull out issues when you need them, as you can grab a box with the issue you want (or even the individual issue) without disrupting a full shelf of magazines.

Food-safe squeeze bottles As I mentioned in my condiment article earlier this week, food safe squeeze bottles are perfect for storing homemade condiment mixes like mayochup or fry sauce. Just thoroughly clean the container, then make your preferred condiment mix in a bowl and put that mix into the clean container. It can easily be labeled with a piece of masking tape.

Shoe boxes We find infinite uses for these! We use them to store craft items, old photos, board game prototype components, small games, art supplies, old notebooks, and all manner of other things. Shoeboxes do not get thrown away around here until they’re literally falling apart.

Spray bottles Bottles that previously contained things like Windex usually wind up with some kind of homemade cleaner in them. In a typical Windex bottle, if I’m making window cleaner, I’ll put in 1/4 cup white vinegar, 1/8 cup rubbing alcohol, two drops of dish soap, and fill it the rest of the way with water. This does a really good job of cleaning up the handprints and fingerprints of children off of windows.

Plastic milk jugs have a lot of uses. One particularly great use for them is to use them as a funnel with a “stopper” by cutting off the bottom of the jug and turning it upside down. You can put the cap on to keep stuff from flowing out of the hole and then remove the cap as needed. That makes old milk jugs perfect for tasks like refilling bird feeders, spreading grass seed, or spreading salt on a slick driveway. With the cap on, you can use it as a pet food scoop. I also sometimes save the caps for board game prototype pieces, as they’re basically like checkers.

Pickle jars and other glass jars I love making homemade pickles, homemade sauerkraut, and things of that nature. Used pickle jars are perfect for storing these in the fridge after making them. Again, simply slapping a piece of masking tape on the jar and writing what the contents are solves the labeling issue, and you can get many dozens of uses out of those jars before the lids stop working well. I also like storing leftover pasta sauce or pizza sauce or salsa in them.

Newspaper We rarely wind up with used newspaper these days, but when we do, I like to roll it into a super-tight bundle and then put masking tape around it in three or four places. This turns it into fantastic kindling for a fire, especially if you roll it super tight. You can build a small arrangement of these little newspaper “logs” and then start a fire with them using one of the egg carton fire starters mentioned earlier. Another thing you can do is cut the bundles into smaller pieces, with each piece held together by masking tape, and then dip the whole thing into excess candle wax (if you have extra from the process above). This kind of “waterproofs” the logs and makes it much easier to start a campfire when things are wet.

Shakers I often pick up interesting spice mixes while traveling, but I rarely discard the jar when it’s empty. Instead, I use those bottles to store common spices I buy in bulk from the local food co-op (or a rare visit to a spice store). I also sometimes use them to store my own homemade spice mixes. As I mentioned, a bit of masking tape and a Sharpie provides a super-inexpensive label so you know what the contents are.

Small pill bottles We often buy aspirin and ibuprofen in larger jumbo-sized containers, then distribute them into smaller pill bottles for keeping in various homemade first aid kits. For example, I keep a small bottle of ibuprofen in my backpack, there’s one with our camping supplies, and there’s another in each of the glove boxes in our cars. Again, a masking tape label never hurts.

T-shirts and highly worn clothing Used clothing items that are just too worn out for Goodwill make for a great rag bag for cleaning up nasty messes. Old t-shirts make for great kitchen/liquid rags and can actually be reused a bunch of times if you spend a few minutes putting an edge on them with a sewing machine. Most of our old clothes wind up in a literal rag bag, though, useful for all kinds of messes and situations indoor and out.

Children’s pools We’ve taken used children’s pools, flipped them over, cut a few small holes in them and cut them to size, and used them to cover our garden in the spring. This keeps the weeds from competing with our little seedlings and also keeps a lot of weeding effort at bay. They won’t last forever but they’ll certainly do the job for a couple of growing cycles, and it gets a lot of additional use out of a kiddie pool with a few leaks in it. Another good use is to use it as the bottom layer in the trunk of a car or the back of a minivan so you can carry around potentially messy things like wood or mulch, drastically minimizing the mess. You can do the same things with an old shower curtain.

Plastic grocery bags Although we usually take reusable bags to the store, sometimes we wind up with plastic grocery bags. Those usually wind up as the lining for small trash cans (with a few empty bags stuffed in the bottom of the can so that there’s always a replacement bag right there) or else used to help clean up pet waste (just invert the bag over your hand to form a “glove,” then pick up the waste and revert the bag, then tie it off… easy as can be).

Children’s wagons Our children have a wagon that they’ve long outgrown, but we keep it around for several reasons. It’s really useful for toting gardening tools and yard tools around the yard and back to the garage after we’re done. It’s useful for carrying heavy bags of seed or mulch or soil to the place where they’re needed. Basically, if there’s something heavy or bulky that needs to be moved around the yard, we just grab the old wagon.

Toothbrushes and electric toothbrush heads When those items start to get really worn out from use, they get relegated to a box of cleaning supplies. They’re perfect for cleaning small, hard-to-reach spots, like the edges of faucets or around the back of the toilet or in grout.

There are many things that seem like they’re used up and ready to be thrown away, but in reality they have many more uses still left in them. Don’t give into your instinct to just toss stuff in the trash or the recycling bin. Instead, ask yourself if there’s not a second use for this item. Do it with everything you might throw away for a few weeks and see what you figure out. Not only will you reduce the volume of materials you’re putting into landfills or even into the recycling system, you might find uses that keep you from spending money on a useful item (like a funnel or a bottle of Windex).

Good luck!

The post Twenty Common Items That See a Second Life in Our Home appeared first on The Simple Dollar.

Questions About Coffee Grinders, Overdrafts, Gym Memberships, and More!

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What’s inside? Here are the questions answered in today’s reader mailbag, boiled down to summaries of five or fewer words. Click on the number to jump straight down to the question.
1. 401(k) checkup?
2. Prioritizing early retirement
3. Is coffee grinder worth it?
4. The point of frugality
5. Frugal foot odor options
6. Buying weights or gym membership?
7. Replacing local news on streaming?
8. Community festivals aren’t cheap!
9. Frugal steps for knee pain
10. Breaking out of overdraft cycle
11. Simple? Obvious?
12. Good journal/planner for goals?

My current morning routine on a good day looks something like this.

I get up at about 5 AM, go downstairs, drink some water, and stretch a bit. I brush my teeth, then spend about 15 minutes meditating, then about 30 minutes writing in my journal. I grab something small for breakfast – lately, it’s been some rolled oats I left soaking overnight in the fridge in some milk with a bit of fruit in there – along with some cold brew coffee and eat the breakfast as I check emails, and then start my day with the coffee, followed by a cup of hot tea when it’s finished.

It feels like that morning routine, when I stick to it for a few days in a row, is like rocket fuel for my day. Everything else just follows perfectly.

During the school year, I’m likely to stick the morning routine with my kids in between the journal writing and my own breakfast, or I might eat the breakfast with them.

On with the questions.

Q1: 401(k) checkup?

What do you recommend in terms of having someone look at my 401(k) and see whether or not I’m making good investment choices? Don’t want to just send information to random people online and ask.
– Jeff

Your best option would be a fee-based financial advisor. Do not go to a commission-based advisor for this type of advice because they will only really make an income if you sign up for their investments, which isn’t what you want.

A fee-based advisor will look at your 401(k) and also talk to you about your goals for the future and make sure that you’re making good choices. There will be a fee involved, of course.

My earlier article on finding a financial advisor will give you what you need to find one.

Q2: Prioritizing early retirement

I first started following The Simple Dollar in 2009, after I was in a car accident and found myself sinking in debt. Fast-forward 10 years and I’ve been trying to follow many of the strategies/mindsets you’ve written about. I’m married now, have a joyful 2.5 year old child, and we are expecting our second child in December. Professionally, I earned a doctorate and actively worked to pay off all debt. This month, we have completely paid off our mortgage. Your post about retirement this week struck a huge chord. I’m currently planning to save towards future big expenses that are important to my wife and I( future used cars for when our current ones die, a future home anticipating a potential future move, college 529’s for our children) and the rest going to a Vanguard Target retirement fund.

My main question: are we right to split our savings this way(cash for anticipated future expenses AND financial independence $) or should I prioritize all of our savings into Vanguard to reach our crossover point faster? Our net worth just crossed half a million, and I anticipate needing a Target Fund balance of $2 million to have the trinity principle working for us. I currently save/invest 83% of my $4300 bi-weekly paycheck. 45% is going to savings and 38% is going to investing for financial independence. Our plan is to save up for our anticipated future family expenses and then shift all of our savings to the Vanguard 2050 Target Retirement Fund. How do you think my wife and I should think about this? Is this sensible or are we missing an opportunity to get to financial independence faster by not going all-in on the Target Retirement Fund?
– Jameson

I think your plan is fine.

Given that you do have known goals that are coming up in a relatively short timeframe, saving for those in a relatively “safe” way (meaning you’re not exposing the money to market risks) is a good choice. I think you’re doing the right thing by saving differently for those goals.

Honestly, the most important number is the savings rate. Selecting the “perfect” investment requires you to know what’s going to happen in the future, and no one can predict the future. Not only is it highly impacted by your own personal future, it’s also impacted by larger market and social forces that determine how various investments go.

Q3: Is coffee grinder worth it?

My partner and I drink multiple cups of coffee every morning and take a full travel mug with us on weekdays. We have always bought ground coffee to use in our drip coffee machine but we have been thinking about buying an electric coffee grinder. Is it worth it?
– Amy

I have tried freshly ground coffee and then coffee ground from the same roaster that was a few weeks old side by side before and the difference was detectable but not an enormous difference maker to my taste buds. I think there’s a much bigger difference in terms of the type of bean you buy and how it was roasted rather than how recently the bean was ground, but there is a small difference.

However, most of the time, whole bean coffee actually costs more per ounce than ground coffee. It’s more expensive to ship per ounce, for starters, and there’s also the issue that whole beans tend to be better quality beans than ground coffee because it’s much easier to hide subpar beans in ground coffee. It’s obvious if there are bad beans in whole bean coffee – you can see that a bean is problematic – but if it’s all ground together, you can’t see it. This allows roasters to have some portion of their ground coffee be made up of things like poorly roasted beans – a small amount, to be sure, but it’s impossible for the end user to tell.

My opinion is that if you have a ground coffee type that you like, stick with it and don’t get a grinder. However, if you’ve tried a number of ground coffees and none of them really scratch your itch like the cup you can get at the local coffee house, then a burr grinder might help, though it will increase the ongoing cost of making coffee at home.

Q4: The point of frugality

I feel like a question that I see you and other PF writers address time and again is “What’s the point of saving and livingly frugally?”

I started following you many years ago when I was young and single, and got my husband on board with a relatively frugal way of living once we got married. We continued to save at a healthy rate and spend much less than we earn once we had kids. We figured things like not eating out much, driving our old car into the ground before replacing it, funding 401ks and Roths and an emergency fund etc, would all just help us be able to retire early, be able to help our kids out in the future, etc. Then our baby boy had a serious medical crisis, nearly died, and went through ensuing health catastrophes that saw him on and off life support 5 different times over a hospitalization that stretched to 8 months long.

During that time I was forced to take an unpaid leave of absence from my job, and my husband lost his job as well (it became extremely difficult for him to concentrate knowing his son was on death’s door). My son finally got out of the hospital, my husband got a new job, and things were looking up, though we had burned through a huge amount of our savings with medical bills and me being unable to work. Things were well for a few months and we thought we would be able to get back on our feet, when my husband’s new company went under, stiffing him on an entire month’s pay and leaving us worse off than ever.

I never would have thought our family go through such a massive disaster, let alone two disasters back to back. It took my husband 7 long months to find a new job, and during that time we had to make some tough choices, like pulling contributions out of our Roths to deal with our sons $3000 a month medical bills. It was extremely stressful, but even in the worst of it I took pride in the fact that the choices we made stretching back years before put us in a position where we could survive it. Not many people would have been able to do it, but we did, and we feel stronger for it. And most of all, we feel a renewed commitment to scrutinizing our spending even further, saving more, and just generally never taking anything for granted. I am so grateful that I discovered your site all those years ago, because I truly don’t know what circumstances my family would be in now if I hadn’t.
– Joanne

Living on less than you earn when times are good means that your life won’t fall apart when times aren’t so good – and for most people there will come a time when times aren’t so good. You have a very strong likelihood of losing a job unexpectedly and facing a period of unemployment or having yourself or a loved one get seriously ill (or even die) or having a business fail or even having a combination of those things happen simultaneously.

Not only does living on less than you earn teach you to live a bit more frugally than you might otherwise do, the extra money enables you to get rid of debts, build up an emergency fund, and save for retirement and other goals. The longer you’re able to live on less than you earn and the bigger the gap between your earnings and your spending, the better off you’ll be no matter what happens in your life.

This is a hard lesson for many people to learn because modern life calls to us constantly with so many short term temptations and so many options to get into debt to have those temptations now. Humans are hard-wired to look at the short term over the long term and thus it takes a lot of thought and effort to start focusing on the long term. There is enormous reward in doing so, as Joanne spells out in her letter.

Q5: Frugal foot odor options

Husband switched to new shoes a few months ago and loves them but they stink horrendously. Our whole entryway smells like death. Tried several things to kill the odor with no success. Getting bad enough that you can smell it a little when he’s walking around in them. Options? Don’t want to throw out these expensive shoes!
– Anna

I had a pair of shoes several years ago that smelled really badly, too. I only really found one routine that helped. I kept a spray bottle with a 50/50 mix of white vinegar and water in the entryway along with a big bag of baking soda. When I got home, I’d spray the shoes down with the spray on the inside, squirting inside each shoe so that it got up by the toes.

Then, before bed, I’d put a little bit of baking soda inside each shoe, just enough to get a light dusting on the inside. Again, I got it down by the toes, too.

This seemed to work pretty well for killing the foot odor. I had to do it every day at first, but then I was able to only have to do it a couple times a week. If the shoes are comfortable and expensive, this system is worth it.

Q6: Buying weights or gym membership?

Been going to the gym 4x week for last three years. I mostly lift weights and use the elliptical. Friend of mine found an amazing set of weights for $500 and I am considering buying them and dropping the gym membership. No membership pays for weights in about 11 months. Thoughts?
– Kevin

Assuming that you have a spot in your home to keep this equipment (and don’t need to upgrade your living space to find room) and that you would actually continue your gym discipline in a home environment, then it’s a win.

I don’t think that either of these two are a given for most people, though. A good weightlifting setup takes quite a lot of space – I don’t know what all is entailed in this package you’re buying, but I’m assuming a lot of weights of different sizes, a bench, some bars, possibly a rack of some kind… that takes up quite a bit of space. That space comes with a cost – you’re either paying rent for it or you have a larger mortgage for it, you have higher property taxes for it, you have more insurance for it, and so on.

Similarly, there’s no guarantee that you’ll continue your weightlifting practice at home. For many people, having a distinct environment for working out is a key part of their continued fitness success and trying to bring that environment home breaks up the magic of doing so. I never recommend people buy home exercise equipment unless they’ve already established some sort of lasting pattern of working out.

If you think that these issues don’t really apply, then buying it is a perfectly good option, especially since you can likely sell them off and recoup most of what you paid for them.

Q7: Replacing local news on streaming?

Hubby and I considering ditching Dish Network and just use Netflix and Sling (mostly for NFL Network and ESPN as he loves football). $55/month would be our new total instead of $120/month, so that’s great! Only problem is that we watch local news most evenings and that will go away.
– Jane

If you live anywhere close to where those local channels broadcast, an over-the-air digital antenna will enable you to pick up those channels for free. An over-the-air antenna is a small device you buy and put somewhere in your home (or possibly on your roof) that retrieves local channels for free, enabling you to not miss the local news. It attaches right into the back of your TV much like your cable box does now and after the initial $20-$50 purchase, it’s free.

We have one and it works great. We live fairly close to a tower that “repeats” the signal of several channels in Des Moines (we live in northern Iowa, with Des Moines being the largest city anywhere near us), so we get about 20 over the air channels for free.

It’s really easy to set up, especially if you live fairly close to the stations themselves or near a tower that “repeats” the signal. You basically just point the antenna in the right direction and you’re good to go.

If you live within about 25 miles of the station, this antenna will work like a champ.

Q8: Community festivals aren’t cheap!

Find it weird that you suggest a community festival as cheap summer entertainment. They’re anything but cheap. Overpriced food stands, overpriced entertainment, overpriced beer tents, rip-off flea markets, way overpriced “carnivals” for kids. Sheesh.
– Amy

Those things undoubtedly exist at community festivals, but a lot of the experience is free. There are usually tons of tours and things going on that don’t cost a dime. The parade is free. There’s usually a free fireworks show. Many of the performances are free, in my experience.

To mitigate the costs that you describe, we often pack a picnic dinner in a cooler and keep it in our car until we’re ready to eat (then Sarah or I goes and retrieves it), so there’s little need to eat the expensive food. We usually skip the flea markets and the carnival stuff and I haven’t been in a beer tent since I was in my twenties. Instead, we usually go through the schedule of events and go to the free things to watch. We always hit the parade, and there is almost always something free to entertain you throughout the day.

I’ve toured a cheese factory, toured multiple art museums, watched a rock throwing contest, listened to some great musical acts, learned how to throw an axe, learned how to juggle, participated in a chess tournament, ate sweet corn, ate pickled eggs, ate lutefisk, watched several food eating contests, and all of it was free and it’s just from things I remember in just the last year or so, and I’m forgetting most of them.

It’s all about what you look for.

Q9: Frugal steps for knee pain

My left knee has hurt constantly for several years and it hurts worse after days where I’ve walked a lot. I have gone to the doctor and been referred to a specialist a couple of times but they always recommend surgery that I can’t afford and I kind of doubt how much it will help anyway. So do you have any cheaper ways that can help with knee pain?
– Nolan

I am not a medical professional. On the other hand, I am a rather tall guy approaching (or in) middle age who likes to do things like play soccer and hike and do taekwondo, plus I weigh a little more than I probably should, so I’m familiar with knee pain.

The best things I’ve found for my own knees are rest, stretching, and lots of balance and flexibility work. My knees feel best when my core is strong and I’ve been stretching consistently (not just my knee, but all of my body) and I’ve been working on things to help my balance and flexibility and mobility.

Most days, I spend some time in the day doing some stretching and flexibility work. I usually do a short stretching routine when I first wake up, then I do this flexibility routine shortly after lunch. I also recommend taking up a martial art and/or yoga, as they really help with both lower back pain and knee pain in my experience. Find a school that’s welcoming for people of your age and ability level or use Youtube videos at home. I really like DDP Yoga (I have a DVD set) and I do a family taekwondo class in my community with my wife and children a few times a week (the martial arts class is the only thing listed here with a cost). Yoga and martial arts help a ton with balance and flexibility and core strength, all of which help distribute your weight better and take some pressure off the ol’ knees, and you really can get started by watching Youtube videos.

On days when my knees hurt, I do some stretching and then try to rest my knees as much as I can. I use a standing desk, but if my knees are sore, I mostly sit while working. However, those days are rarer than they used to be – they haven’t vanished, but they’re rarer.

Q10: Breaking out of overdraft cycle

Do you have any tips for breaking out of a cycle of checking account overdrafts? My bank charges $35 per overdraft so if I get 1 or 2 of them I’m so far in the hole already on the next paycheck that I can’t keep the bills paid.
– Nadine

I actually wrote a full article on this topic a while back and the core principles are still 100% true.

My best suggestion for getting out of this cycle is to simply spend a month living super-lean and doing everything in your power to not overdraft. Do whatever you need to do to keep it cheap. Eat a lot of bananas and beans and peanut butter and ramen. Walk to work and back home. Only go out if the activity is free. Do everything you can to keep your dollars in your pocket so that you’re not dealing with another overdraft expense.

After that, the thing you need to focus on the most is making sure that you don’t fall back into the trap again. One good strategy is to do a form of envelope budgeting. Withdraw the money you want to spend on incidentals and fun things at the start of the month, then don’t touch your checking account again for anything other than essential bills. Once your incidental/fun thing money runs out for the month, then you’re done until next month.

Once you’re out of the overdraft cycle, it really doesn’t take that much of a change in your spending to stay out of it. For most people, even a simple budgeting step like taking your incidental money out at the start of the month and then not touching the account for the rest of the month except for needs will be enough to stay above water. Good luck!

Q11: Simple? Obvious?

Most of the stuff you talk about on your site is obvious to anyone with half a brain. Can’t believe you make money doing this.
– Brad

Well, for starters, it’s not called “The Simple Dollar” for nothing. I make a conscious effort to focus on the simple things, and when I write about more complex things, I intentionally use an earnest tone and try to use simple language to describe them. Personal finance should be easy for everyone.

The reality is that personal finance actually is pretty simple and straightforward in terms of what you need to know to succeed. It’s not rocket science.

But if it’s so easy and obvious, why is it that almost 80% of Americans live paycheck to paycheck? The reason is that although the ideas are simple and obvious, they’re fairly hard to implement. They often require us to do things in opposition to what our natural choice would be. Humans are short term thinkers for the most part, and personal finance is really a long term endeavor. You won’t transform your life in a month.

I find that the execution of good financial habits requires lots of psychological tricks and some coaching, too. Different tricks and different coaching styles work well for different people. There’s also a ton of detail work when it comes to personal finance, so while I repeatedly hammer home the big points in an earnest tone, I also try to fill in lots of the details along the way, too.

My goal is to make personal finance seem simple and, yeah, obvious, but do it in a way that encourages people to take action to put themselves in a better situation. You can do this, and here’s how. That’s the goal of the site. For some, that might not be useful, but I know from experience that a lot of people have found value in it.

Q12: Good journal/planner for goals?

I really enjoyed your article on goal planners. Do you have any updates or new recommendations? The Momentum Planner you suggested is just a bit too structured for me.
– Amy

I am still really sold on the Momentum Planner and I’ve been using the print edition this year (they’re six month planners, so I actually just started my second one for the year several weeks ago) with great success. However, I do agree that it is highly structured, as it is strongly focused on taking a yearlong goal and breaking it down into progressively smaller pieces in a very highly structured way, and that might not be what everyone is looking for.

I do really like the Clear Habit Journal from Baron Fig, which is highly tied to the ideas in the book Atomic Habits by James Clear. I think this is probably the best one out there if you’re trying to establish habits rather than executing goals, but I’d strongly recommend reading the book before using the journal.

I am very interested in trying the Theme System Journal, which is a journal oriented around the idea of a year having a “theme” and your actions and projects for the year falling in line behind that theme. It’s an idea frequently discussed on the Cortex, for which I’m an active listener. This is an approach I’m thinking a lot about applying in my own life in 2020.

My current planner/journal system is threefold. I have one that I use for “morning pages” each morning (where I basically just write a brain dump for 30 minutes), my Momentum Planner (as noted earlier), and then a “nightly review” notebook where I go over the habits I’m working on. I find that taking time to actually write in a journal/notebook pays incredible dividends for my clarity of mind. It just makes a lot of decisions throughout the day crystal clear, and I end up feeling really productive when I’m fully on board with the system (by “productive,” I mean that I’m actively doing something good in all of the various areas of my life).

Got any questions? The best way to ask is to follow me on Facebook and ask questions directly there. I’ll attempt to answer them in a future mailbag (which, by way of full disclosure, may also get re-posted on other websites that pick up my blog). However, I do receive many, many questions per week, so I may not necessarily be able to answer yours.

The post Questions About Coffee Grinders, Overdrafts, Gym Memberships, and More! appeared first on The Simple Dollar.

Aligning Health Goals with Personal Finance Goals

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It’s no secret to anyone reading The Simple Dollar for very long that I’m a goal-oriented person. I find a great deal of power in setting goals for myself, developing plans for those goals, and working toward them by executing that plan as well as I can and revising it as needed.

I view my own life as a series of spheres (physical, mental, social, spiritual, financial, professional, marital, parental, avocational, intellectual) and, ideally, I want to always have some kind of goal going that provides a lot of value to each of those spheres. However, that doesn’t mean I always have nine or ten goals going at all times; in fact, I usually try to keep that number around five.

I do that by aiming to come up with goals that serve two or more spheres at the same time. Most of the big goals I come up with in life are ones that really hit two or more of those areas at once and usually have a secondary benefit for some of the other spheres.

Some of these spheres tend to have a lot of synergy. There are a lot of goals I can define that scratch both the “intellectual” and “avocational” goals at the same time, because I like hobbies that make me think. There are a lot of goals that scratch both the “parental” and “marital” goals if they’re focused on building a great home environment for my wife and my kids (and that often helps me with a few other spheres indirectly).

What I really wanted to focus on today is another pairing of spheres that seem to have a lot of synergy, and that’s “financial” and “physical.” I find that there are a lot of really powerful goals that touch on both the “financial” and “physical” spheres at the same time by encouraging both financial and physical fitness.

I covered some of that synergy in my post earlier this year on the connections between your physical life and your financial life, but I didn’t really delve into actually setting goals for yourself that took advantage of those extensive connections and overlap. Today, that’s exactly what we’re looking at: translating the extensive overlap between physical health and financial goals into meaningful goals for both spheres.

As I stated in the earlier article, the core of physical life, for me, is whether or not I feel good and energetic and relatively pain-free each day such that I feel like I can take on life’s challenges, and am I doing what I can to keep that state going forward, both in the short term and the long term. I want to feel good enough to do the things I want to do for as long as I possibly can, and the better I feel, the better.

As I’ve stated elsewhere, the core of one’s financial life, for me, is having the financial resources to live a contented life, to protect that life as much as possible from unexpected events, and to improve one’s financial state so that one no longer is required to work for a living to sustain their contented life.

Let’s start by making a list of areas where these two elements overlap meaningfully, drawing at least in part from that previous article.

Paying attention to your physical health and taking action in positive ways reduces both your short term and long term health care costs. You’re simply going to avoid a lot of health issues if you do the things you should be doing in terms of your personal health, and that directly benefits your pocket in terms of lower health care costs, both now and in the future.

Your food, beverage, and vice costs are lower if you’re consuming a healthy diet and minimizing vices, both of which contribute to a healthier life. Your beverage costs are going to decline if you switch to almost exclusively drinking water, which is one of the best health moves you can make. If you give up consumption vices that are bad for your health, such as alcohol, cigarettes, caffeine, or hard drugs, that’s an expense that disappears out of your life. Even eating a healthier diet with a high proportion of fruits and vegetables prepared at home is going to be a significant money saver over the typical American diet. Most of the consumption choices you make for your health are also going to help your financial situation as well.

Your insurance costs are lower if you can demonstrate a higher level of health. This is particularly true for health insurance and life insurance, but there’s a smaller effect for other kinds of insurance as well. Both life insurance and health insurance are quoted based on data that includes some of your vital statistics, and thus the better those statistics, the better off you are.

The healthier and more energetic you feel, the more you feel ready to take on challenges and projects, many of which can be enormous money savers. Trust me, I’ve been there – the less healthy and less energetic you feel, the harder it is to motivate yourself to do anything. This is key, because many of the things you need to do to cut your spending require at least some energy output. When you feel completely unenergetic, it’s hard to convince yourself to get up and go to the grocery store or to make a healthy meal.

The healthier and more energetic you feel, the easier it is to raise your income level. This also applies to income. The healthier and more energetic you feel, the easier it is to be productive at work and to build the kinds of professional and client relationships that will help you earn more money.

Of course, investing money into your health in unnecessary ways undoes some of these financial benefits, so there is enormous benefit in finding cost-effective ways to keep your health in line. That’s why a great goal that straddles the line between health and finances seek out low cost and highly effective strategies for achieving that goal. For example, opening the wallet to buy a gym membership or a bunch of exercise equipment or a bunch of kitchen gear are definitely not in line with financial success and may have marginal success for your health as well.

Goals That Benefit Both Health and Finances

What we want are goals that produce significant health benefits – and thus the cost savings described above – without significant financial input (at least, not to get started). Here are four specific types of goals that will help you see real gains with improving your health, and within each we’ll look at some specific goal examples and how to implement them without spending a lot of money.

Physical activity goals are ones that aim to increase your physical activity and thus physical fitness. Physical activity helps to reduce your heart rate, reduce your resting blood pressure, raises your overall energy levels… it’s just good for you in pretty much every dimension.

Of course, there are many ways to make a physical activity goal very expensive, like buying a gym membership or buying lots of exercise gear. We want to focus on free or very low cost physical activity goals.

A daily step count goal This simply encourages you to walk more. Setting a goal of “I will walk 6,000 steps each day” or “I will walk 10,000 steps each day” or “I will walk 20,000 steps each day” is a very clear goal that doesn’t have any additional costs and is easy to achieve. You’ll likely want to slowly ramp this goal up over time, starting with a level that’s easy to achieve and then ticking it upwards. I recommend aiming for at least 10,000 steps.

How do you track this? Your smartphone can easily do it. There are a number of pedometer (step count) apps for Android, and on iOS the built-in Health app functions as a pedometer. You just have to have your phone with you.

A daily (or “X times a week”) home exercise routine The variety of home exercise routines is endless. It really depends on your goals. Do you want flexibility? Core strength? Balance? Cardio health? There are different home exercise routines that can help with each. For example, my home exercise routine is mostly oriented toward flexibility and mobility and balance (which inherently helps with core strength), with a little bit of cardio mixed in.

You can find tons and tons and tons of great routines on Youtube for home exercise without equipment that helps you with whatever goal you have and at whatever level of fitness you desire. The key is to make sure that you’re doing something that’s not way above your level of fitness (rendering you miserable – you can work up to that over time) and something you at least mildly enjoy. I never, ever stick with fitness routines that I dread or make me feel miserable.

A daily deliberate practice goal is a great option if you’re trying to build up a particular physical skill. For example, I have a daily deliberate practice goal of doing a series of taekwondo kicks very slowly (I do community taekwondo classes with my entire family, and the slow kicks are a great form of deliberate practice). This is all about the things you’re doing in your life already and may not be applicable to you at all, but if you’re involved in any kind of regular physical activity or sport, there’s almost always some sort of specific deliberate practice you can do at home to get better at it.

Food consumption goals are all about getting a better grip on the food you put into your body. This is often done to combat obesity and ideally move people toward a more optimal body weight for their height, which reduces the likelihood of many, many health conditions from heart disease and various types of cancer to diabetes.

Food consumption goals can take all kinds of forms depending on your goals.

A daily calorie goal basically means that you’re aiming to only consume a certain number of calories in a day, however you choose to do it. For most people, this is a reduction in calorie intake and thus should result in reduced food costs.

There are many smartphone apps that do a great job of counting and recording calories. You simply set a daily calorie goal and log the food you eat as you go along and the app will tell you how many of your daily calories you’ve consumed and how many you have left.

It’s worth noting that such goals are far more valuable if they represent a gradual permanent change rather than a radical and unsustainable change. A good way to start is to set a calorie goal that’s just a little lower than what you need to maintain your current weight, then nudge it slowly downward if you so choose. This won’t mean rapid weight loss, but it does mean lifestyle changes that you can actually sustain.

A daily increase in fruit and vegetable consumption and/or a reduction in meat and dairy consumption is a goal that can easily be achieved with a rule like “Eat vegan before dinner” or “Accompany all meals with a fruit” or “Eat a serving of vegetables at the start of every meal.” It really depends on how you want to approach it.

These kinds of changes work best when you’re consuming things you actually like. If you only like certain vegetables, stick to those and avoid ones you don’t like (and try a few new ones here and there).

A reduction in meals eaten outside the home is a goal that orients you toward home food preparation, which can save a great deal of money over the long term. This also can improve your health because, for the most part, meals prepared at home are typically healthier than meals at restaurants (where the aim is usually fast and delicious with little consideration of health).

A good way to do this is to simply set a numerical goal for each week. “This week, I will only eat out twice” could be a great goal if you eat out on a daily basis.

Vice-related goals are aims to reduce or eliminate particular vices from your life – alcohol consumption, cigarettes, drug use, soda, unhealthy snacks, and so on. Such a goal aims for long term health, though cutting out the vice can be difficult. This type of goal has a great short term benefit – the reduction or elimination of the cost of a vice – and a great long term benefit – the reduction in health care costs from the vice.

Complete elimination of the vice is a great goal, of course, but it can be a challenging goal for many people and can have other unexpected consequences. The best first step toward this goal is to simply get rid of that vice in your home (and office and car) and then not purchase any more of it, making it rather difficult to acquire more.

Elimination of the vice outside of specific circumstances is another good goal. For example, people may want to eliminate all alcohol consumption except for social situations outside the home where you drink a maximum of two drinks. This means that you have no alcohol at home and only drink when you’re at a social situation where it’s the norm.

Sleep goals focus on improving the quality of your sleep by ensuring that you get enough hours in bed and that you wake up as naturally as possible. Getting adequate rest drastically boosts energy levels and mental clarity and reduces the chance of illness. There are a number of ways to achieve these benefits through straightforward goals.

Setting an earlier bedtime simply comes down to a goal like “going to bed at 9 PM each weeknight” or something to that effect. In general, on any day when you have to get up at a specific time, you should aim to go to sleep seven to eight hours before you have to arise. Ideally, this enables you to start arising naturally without an alarm forcing you to be awake.

Eliminating sleep-interrupting distractions leading up to bedtime enables you to get to sleep much easier upon going to bed. For example, you might set a goal of “no looking at screens for 30 minutes before going to bed” along with “no devices in the bedroom.” This eliminates the effect that many screens have in terms of keeping your mind fully awake and thus keeping sleep at bay.

Why no “weight loss goals”? It’s easy: your weight is a “result” number, not an “effort” number. Actual weight loss is the result of effort you put into other areas, mostly related to food intake but also somewhat related to physical activity. However, it’s very difficult to predict the rate at which you will lose weight. You can’t actually control that exact number with any precision, and your weight will sometimes be unchanged or even go up after a week or even a month of effort in terms of losing weight (due to things like water retention, salt intake, your body’s unique chemistry, and so on).

If you’re absolutely insistent on using weight as a metric for your health, do not rely solely on the number you see when you step on the scale. Instead, use a weighted average, which smooths out the day-to-day variations in your weight. I highly recommend using the smartphone app Happy Scale for doing this, as it does all of that automatically. You just enter your weight each day and don’t really worry about your day-in day-out number. Rather, if you’re actually doing the steps in your goal, you should see a gradual change in your weight toward your target number.

Tracking Goals

If a goal clearly has a daily or weekly number attached to it (or a daily or weekly “yes I did this/no I did not” attached to it), I find a lot of value in tracking those numbers on a grid, where I fill in a box for each day where I achieved that number. A wall calendar is a great way to do this. For example, if your daily goal is to walk 10,000 steps, use a wall calendar and put a huge red checkmark on each day where you did it and a huge black X on days where you didn’t. It’s subtle, but it really encourages you to fill up the spaces with the positive marks rather than the negative marks. Most fitness goals are easy to break down into this type of numerical or yes/no evaluation.

Beyond that, for all goals, I also like to use the method described in the book Triggers by Marshall Goldsmith, where he identifies a very strong method for reinforcing good behavior in our mind. At the end of each day, you simply do a “check-in” for each of your goals by asking yourself whether or not you did your best today to achieve that goal and scoring your effort on a scale of 1 to 10. As with the previous “check box” method, you’ll find yourself wanting to have a series of high numbers for any goal that you create and thus you will find yourself continually trying to reinforce that good behavior. Over time, the behavior slowly becomes natural.

Final Thoughts

The health goals described in this article not only produce positive results in terms of how good you feel and how your body appears and the long term health of your body, but the goals themselves and the results of those goals have a strong positive impact on your finances by reducing food, insurance, health care, and vice costs both in the short term and in the long term while also boosting your energy and readiness for personal and professional tasks.

A well-designed and well-considered health-related goal is one that benefits the financial sphere of your life. Improve your health and you’re likely to improve your finances, too.

Good luck!

The post Aligning Health Goals with Personal Finance Goals appeared first on The Simple Dollar.

Don’t buy a new car without this cheat sheet!

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Congratulations — you’re about to snag a new ride! We’re assuming that you’ve already done some research: You know how much you can afford to spend, which car you want to buy, and the true market value (what other people are paying) for that car in your area.

And now you’re ready to buy. Follow these steps to get a good deal and make the car-buying process at the dealership as painless as possible. To help make it easier, download our cheat sheet and take it with you.

At the dealership, evaluate the car and the salesperson. (Photo from Getty Images.)

At the dealership, evaluate the car and the salesperson. (Photo from Getty Images)

Before you go to the dealership

Arrange financing ahead of time to make the negotiation easier and help you get the best deal.

  • Check your credit score. If you need to build your credit, consider waiting until your score will let you get acceptable financing terms.
  • If it looks good, apply to get preapproved or pre-qualified for an auto loan.
  • Select the best interest rate and the shortest loan term you can handle.
  • Consider calling the dealership to confirm the car is still for sale.
  • If you call, prescreen the salesperson: Does he or she listen and seem knowledgeable?
  • Decide if you’ll want extras like an extended warranty, paint protection, or additional anti-theft devices. Remember, these are high-profit items for the dealer and you can always buy them later.

Bring these items

Think ahead and be prepared with the right documents and information. Take with you:

  • True market pricing from, Kelley Blue Book, or NADA, the National Automobile Dealers Association.
  • Information about incentives, rebates or special financing deals.
  • Proof of insurance and a check for your down payment (aim for 20% for a new car, 10% for a used car).
  • If you’re trading in: the car’s title or loan documents and extra keys.
  • A snack and water in case the deal takes a long time.

Arriving at the dealership

A salesperson will greet you and urge you to take a test drive. Afterward, be ready for increased pressure to begin negotiations.

  • Evaluate the car, but also the salesperson.
  • Is the salesperson: Listening to your needs? Knowledgeable? Relaxed, yet efficient?
  • If asked, don’t consent to a credit check before the test drive. Say you’re already preapproved for a loan.
  • Avoid naming the monthly payment you want. Just say, “I’m a cash buyer.”

On the test drive

The test drive will provide the sensory information you need to decide if this is the right car for you. Don’t rush this step, and don’t let the salesperson distract you with a chatty sales pitch.

  • Tell the salesperson you need to test drive for at least 15 minutes.
  • Drive a route that includes tight corners, hills, rough pavement and highway.
  • Turn off the radio and pay attention to acceleration, braking, visibility and seat comfort.
  • Check the cargo area and backseat legroom.
  • If you don’t like your salesperson, ask to see a sales manager or just leave.
  • If you’re still undecided about the car, don’t be pressured into buying it.

Negotiating the price

If you like the car and are comfortable with your salesperson, it’s time to make a deal in the sales office. Try to remain unemotional and be ready to leave if you feel pressured or the pricing doesn’t line up with your research.

  • Ask the salesperson to name a price instead of responding to the common: “Make me an offer!”
  • Compare the dealership’s price to your numbers from Edmunds, Kelley Blue Book, or NADA.
  • Make a counteroffer of $1000 below the true market price.
  • You can say: “My research shows the market price is…” Or, “I’ve gotten offers from other dealerships that are lower.”
  • If necessary, increase your offer by $250 increments until you reach the true market price.
  • If the salesperson says, “I’ll take this to my boss,” tell them your time is limited.
  • If there’s too much back-and-forth, ask to speak directly to the sales manager.

Closing the deal

Before you say “yes,” there are a few questions you should ask to make sure you know what you’re agreeing to.

  • Ask for an “out the door” price and a breakdown of fees.
  • Question the fees (except for the sales tax, documentation fee, and registration costs).
  • Ask the dealer to remove any unwanted dealer-installed options such as alarms.
  • Use your cell phone to take a picture of the deal sheet to use in the next step.

In the finance office

You’re not done yet! You’ll now be handed off to the finance and insurance manager, who will pitch warranties and extras. Verify that the terms you reached with the salesperson are in your contract.

  • Say no to extras you probably don’t want such as fabric and paint protection.
  • Deflect the extended warranty pitch by saying, “I’ll probably trade in my car before it’s out of the included factory warranty.”
  • If the finance manager offers to beat your preapproved loan rate, fill out a credit application.
  • To easily compare loan offers, keep the down payment and loan length the same.
  • Make sure the numbers in the sales contract match the agreed-upon price.
  • Review the prices in all the boxes and question anything unexpected.
  • If anything is missing from the car or it needs repairs, get it in writing.
  • If everything looks good, sign and get your keys!

Woohoo — you did it!

The article Don’t Buy a Car Without This Cheat Sheet originally appeared on NerdWallet.

The post Don’t buy a new car without this cheat sheet! appeared first on Get Rich Slowly.

The best car insurance companies of 2019

sourced from:

Car insurance really comes down to one thing.

Getting the best quote from a good company.

I’m going to show you the same process that saved me $2,088 per year with only a few hours worth of work.

Before we jump into the process and exact scripts that I used, I’m going to break down the best car insurance companies out there.

By the end of this article:

  • You’ll know which companies to trust and which to avoid.
  • You’ll know which kind of car insurance we skip to lower our bills. And the kind that we max out on.
  • You’ll know the script to negotiate with any car insurance company to get them to lower their quote.

The best auto insurance providers

There’s an awful lot of car insurance companies out there. We’ve gone through over 50 and narrowed them down to our top 16 companies:

How did we pick these 16 companies? We looked at several factors.

User experience

When it comes to user experience, I mostly looked at the websites and mobile apps. Every company in our list except for Erie Insurance has a decent mobile app. Geico, Allstate, and American Family had very impressive reviews, and are clear standouts. I’ve included all the App Store reviews below. What I care most about is the ability to show proof of insurance via an app on my iPhone. All of the companies listed except for Erie offer this feature. None of the apps have terrible reviews.

Claims process

JD Power does a good job rating customer satisfaction when it comes to the claims process. If an accident does happen, the claims process needs to be smooth. I’d personally rather pay a little more and ensure that I won’t deal with a bunch of headache in the event of an accident.

Financial solvency

AM Best is one of the five independent agencies that rate the financial strength of insurance companies. If a company isn’t A-rated and financially strong, I chopped them from the list. There are enough options to not mess around with anything less than an insurance company that has a great financial foundation.

Customer satisfaction

Consumer Reports has customer satisfaction scores, but I take them with a grain of salt. While Consumer Reports says that their scores come from 23,000 subscribers, we don’t really know how many responses each company had and how reliable the score is. But it is better than nothing.

Location / availability

All of the biggest insurance companies are national. That doesn’t make them the best. Just the biggest. There are a few that are limited to certain states, like American Family, Auto-Owners, Erie Insurance, and Auto Club, so keep that in mind when considering them.

Some companies are only available in a couple of states. I cut most of them from our list of recommended companies.

Lastly, USAA is the most highly recommended, but only available to active, retired, and honorably separated officers and enlisted personnel of the U.S. military along with their families. For the rest of us, we’ll have to look elsewhere.

The ratings for our top 16 car insurance companies

Here are all the ratings and satisfaction scores for our top 16 insurance companies:


J.D. Power claims satisfaction score

AM Best financial rating

Consumer Reports reader score

Avg app rating































State Farm





American Family





Auto-Owner’s Insurance










Amica Mutual





Erie Insurance





The Hartford





Liberty Mutual










Auto Club Group





All of these companies have good or great ratings across these categories, which is why we’ve included them on our list.

How car insurance works

When you get a car insurance quote, the insurance company is going to ask you how much coverage you want on all sorts of stuff.

It even seems like car insurance companies have deliberately tried to make this as confusing as possible:

  • Different parts of your policy cover different stuff
  • Some stuff is optional
  • Some stuff isn’t optional in other states
  • Some items overlap, so it’s really easy to be “over-insured”

Bear with me. Once we’ve gone through the different components of a car insurance policy, the quote process is going to be a lot easier.

And you’ll avoid getting tricked by car insurance companies that want you to pay for more insurance than you really need.

Liability coverage

Liability coverage covers damage you cause to people and property.

There are two types.

Bodily injury liability coverage: Covers medical expenses for the people who get injured in the accident you cause.

Property damage liability coverage: Covers the other person’s vehicle or other property that gets damaged in the accident you cause.

It actually gets a bit more complicated than this. There are other types of liability coverage that you can add. For now, let’s focus on the main two types.

When you get your core liability coverage, your insurance company will ask you how much coverage you want. The higher your coverage, the more money your insurance company will be willing to pay out during a serious accident.

Think of it like this.

Let’s say you wreck a Toyota Corolla, which is worth about $20,000. If you have a $100,000 property liability coverage, no big deal. Your insurance company will completely replace the car.

Now let’s say you wreck a Ferrari that costs $250,000, and have that same property liability coverage of $100,000. In this case, your insurance policy will only pay up to $100,000. You’re on the hook for the other $150,000.

Remember one simple rule for liability coverage: Larger numbers are better.

The higher your liability coverage, the more your insurance company is willing to pay before they leave you hanging.

Car insurance companies use some fancy notation for this liability coverage. It looks like this: $100,000/$300,000/$100,000.

In plain language, that means:

  • $100,000 bodily injury payout per person.
  • $300,000 bodily injury payout per accident. This caps the bodily injury coverage, regardless of how many people are in the accident.
  • $100,000 property damage payout per accident.

Remember our liability coverage rule — higher numbers are better. That will cover you across a larger range of accidents.

So how much liability coverage is enough?

Think of insurance like this: It’s there to keep you out of financial catastrophe during a serious accident. You want as much as you can possibly get. If an accident is bad enough, you could easily hit the limits of your coverage. That’s not a position anyone wants to be in.

Yes, higher liability coverage will raise the cost of your insurance policy. First, we’ll show you a few items to skip, which will compensate. Second, we’ve got scripts further down for you to negotiate your costs and get them down even further. Between those two things, you should have no problem getting more liability coverage without having to raise the price of your plan.

I personally went with $100,000/$300,000/$100,000. I did do some research on averages and found that most folks end up with $100,000/$300,000/$50,000. For me, that’s too low. 

Vehicle coverage

All of that liability coverage you need to pay for doesn’t protect your own vehicle. That’s where collision and comprehension coverage come into play.

  • Collision Coverage: Covers your vehicle in an accident with another vehicle or object. 
  • Comprehension Coverage: Covers your vehicle from weather, theft, etc.

Protecting your vehicle is required if you have a lease or are financing your vehicle. If you own it, then it comes down to comparing the value of your car to the risk of not covering it. Make this decision based on how old the car is and whether you’re planning on replacing it soon.

Covering your vehicle works a bit differently than the liability coverage. Instead of picking the amount of coverage you want, you’ll pick the size of your deductible.

Deductibles for car insurance work just like medical deductibles. It’s the amount that you have to pay before your coverage kicks in. Let’s say you have a $1,000 deductible. In an accident, you’d pay the first $1,000, and then the insurance company would cover everything else.

I use two guidelines when picking my car insurance deductible:

  • If you get in accidents regularly or don’t have much cash on hand, get a lower deductible.
  • If you rarely get in accidents and can easily cover the whole deductible, get a higher deductible.

The higher your deductible, the lower the cost of your policy. While a higher deductible saves you money today, don’t pick a deductible that you wouldn’t be able to pay at any given moment. A $2,500 deductible means that you’d need the ability to pay $2,500 without warning in order to replace your car during a bad accident.

Underinsured / uninsured motorist bodily and property damage

Underinsured / uninsured motorist bodily injury coverage covers you and your passengers in the event that someone causes an accident but doesn’t have proper coverage.

Underinsured / uninsured motorist property damage coverage is the same thing, but covers your property if the other driver is at fault and doesn’t have adequate coverage.

Wait a second, isn’t all this stuff already covered?

By getting coverage for my vehicle, it’s covered regardless of who causes the accident. I also have health insurance, so I’ve got my medical bills covered too.

Why double up on everything by also getting underinsured motorist coverage?

That is an excellent question. If we have good health insurance and can afford the deductible for our vehicle, we don’t see a reason to get this extra coverage. 

Some states do require this on your policy. In that case, we get the minimum that we’re required to. The main downside to this approach is that we’ll have to pay our deductible even if we’re not at fault and the other person is underinsured or uninsured. 

When we’re in other states, we skip this altogether.

Personal injury protection

Personal injury protection (PIP) covers medical expenses for you and your passengers’ medical bills, regardless of who is responsible for causing the accident. It could also cover lost wages.

Is it worth it?

We don’t use this ourselves. Since it overlaps with our health insurance, we don’t see a reason to get it. In our case, we’d be paying for the same insurance twice. If our health insurance was weak or we regularly had passengers without health insurance, maybe it would make sense.

Depending on your state, it’ll either be required, an option, or not an option at all. If we found ourselves in a state where it’s required, we’d get the bare minimum amount.

These are the states that require personal injury protection: District of Columbia, Florida, Hawaii, Kansas, Kentucky, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Dakota, Pennsylvania, and Utah.


Extras could include roadside assistance, rental car coverage, a glass deductible, and so forth.

As a general rule, extras are a waste of time with car insurance.

Take roadside assistance as an example. It can be a lifesaver, but the benefits are better and it tends to be cheaper by going with a dedicated service like AAA or checking your credit card perks.

Now, if you know that you’d take full advantage of one of these extras, it could make sense to add it to your policy. We’d only add one if we knew with certainty that we’d be taking advantage of it. If we’re not sure, we skip them.

Our rules for which coverage to get

We covered a lot of ground just now, so let’s recap the rules that we use for getting coverage:

  • Liability coverage = Get as much as possible.
  • Deductible = Keep this low if you have regular accidents or don’t have cash on hand to cover a higher deductible. Otherwise, get a higher deductible.
  • Underinsured motorist bodily and property damage = Skip this unless it’s required by the state you’re living in.
  • Personal injury protection = Skip this unless it’s required by the state you’re living in.
  • Extras = Skip these too.

The 4-step process to get the best car insurance policy

Now that you know how car insurance works, it’s time to get your policy. With 4 easy steps, you’ll have your policy by the end of today:

  1. Start with our list of insurance companies.
  2. Get quotes from at least 5 insurance companies.
  3. Negotiate with your top choices.
  4. Pick your winning policy.

I’ll walk you through each of these steps and show you the quotes that I got.

This is the exact process that I used to get my car insurance policy. In fact, I saved $2,088/year by going through this exact process. I wish that I had done this years ago based on how much money I just saved with a few hours of work.

Step1: Start with this list of insurance companies

Based on customer satisfaction with the claims process, overall consumer reviews, and the financial health of the company, any of these companies are worth considering:

That’s 16 options.

A few of these won’t be available to you. Not every insurance carrier is available in every state. And USAA is only available to active, retired, and honorably separated officers and enlisted personnel of the U.S. military, or their families.

If you want to be extra thorough, it is a good idea to figure out the coverage requirements in your state. Then you’ll know why an insurance company is forcing you to get PIP coverage, for example.

Step 2: Get quotes from at least 5 insurance companies

“5 quotes? Really? Not just one?”

We’re completely serious: Get at LEAST 5 quotes. If you really want to get the best insurance policy, you’ll want to get a quote from all 16 companies in our list.

Here’s the thing about car insurance policies.

Once you’ve filtered for legitimate companies that have good claims processes and consumer satisfaction scores, the policies are all the same. The only difference is price.

So it’s all about getting the best quote for the policy that you want.

And there’s a wide range of quotes that you’ll get.

Here’s the policy I got quotes on:

  • Liability coverage: $100,000 / $300,000 / $100,000
  • Personal injury protection coverage: Not needed
  • Collision deductible: $1,000
  • Comprehension deductible: $1,000
  • Underinsured motorist property damage coverage: None
  • Extras: Decline all

After spending several hours requesting quotes from every company on this list, I got quotes that ranged from $1,000/year to $4,600/year. That’s a huge range. If I had picked the wrong company, done one quote, and went with it, I could have been spending an extra $3,600/year for nothing.

By requesting 5 quotes, you could save yourself thousands of dollars per year.

Step 3: Negotiate with your top choices

Here are all the quotes that I received, along with all the ratings:


J.D. Power claims satisfaction score

AM Best financial rating

Consumer Reports reader score

Avg app rating





































State Farm






American Family





Auto-Owner’s Insurance











Amica Mutual






Erie Insurance





The Hartford





Liberty Mutual












Auto Club Group





For the companies that are missing quotes, coverage either wasn’t available to me or I wasn’t able to finish the quote process.

At this point, we have some possible winners and several clear losers.

I immediately cut out the most expensive quotes. Even when their agents tried to call or email me, I just ignored them. Their quotes were too high for me to expect they could get anywhere close to the other companies.

There were also a few companies that pissed me off during the quote process. Things didn’t load right or I had trouble getting the quote I wanted. I cut those out too.

That got my list down to 7.

To see if any of them could get closer to the best quote, I started calling them.

I started with Amica and Travelers. I told them that I was getting quotes for around $530-$550 for 6 months, from both Progressive and Esurance. Neither of them could beat the $530, but they both came down to about $650, which gives me more options so I’m not making my decision purely off price.

Use this script for negotiating care insurance:

ACME INSURANCE: Hello, Acme Insurance. How may I help you today?

YOU: I’d like to negotiate a policy. [Other insurance company] is offering to insure me for $XXX less for [coverage]. I’d like to know if there’s a better deal from you, please.

Wait for their response. Negotiating with this technique is much harder to do with car insurance companies than banks — but it is possible. If they’re stubborn and try to shoot you down, keep pressing at it. Don’t make it easy for them to say no.

ACME INSURANCE: Sorry, but our rates are fixed at this time and we can’t change it due to [some BS excuse about why they can’t give you a lower rate].

YOU: Well, I’ve been a good driver for X years now and would love a lower rate. What else can you do to help me?

ACME INSURANCE: Hmm, one second. I see that you’re a really good customer. I’m going to check with my supervisor. Can you hold for a second?


I was able to check with my supervisor and can lower that policy by X%. Does that work?

You’ll have the most leverage by already having a lower quote from another company. Depending on how good that quote is, other companies may or may not be able to match it. IF they do, you’ll have more options on the final company that you pick.

Step 4: Pick your winning policy

Here’s how I narrowed my policy. First, I was left with 4 great options:

  • Progressive
  • Travelers
  • Esurance
  • Amica

My previous insurance provider was Progressive, which probably has something to do with why their quote was so low. I have been happy with them, although I haven’t had to deal with any claims.

And Amica has awesome customer satisfaction ratings.

That’s enough for me to cut Travelers and Esurance from my list, leaving me with 2 options: Progressive versus Amica.

I decided to stick with Progressive since they gave me the best rate and I have been with them for years.

I should note that my previous policy with Progressive was $1,600 for 6 months. Even though I went through this entire process only to keep my current provider, I was able to still save $2,088/year.

Go through your top 3-5 choices after you’ve negotiated. Then pick a winner that has the best combination of a great price and good customer satisfaction scores.

The best car insurance companies of 2019 is a post from: I Will Teach You To Be Rich.