What Metrics Matter for Financial Success?

Last week, our net worth in Mint crossed $100,000. When we were paying down my student loan debt six years ago, I tracked our net worth meticulously. I was elated when it finally climbed out of the negatives. Then, it felt like it crept up ever so slowly, languishing in the $20,000 range forever. I was desperate to see it grow larger.

So why was my reaction to a much larger number simply to think, “Oh, that’s nice,” fire off a quick tweet, and go about my day with nary a snake hips gif?

Back then, I think I valued our net worth so highly because it was a sign that we were building something. Paying down debt is just that–watching a number decrease. Intellectually, you know you’re making headway every time you mail in a loan check, but it’s psychologically much more appealing to watch a number go up rather than down.

I also think that net worth mattered more then because, as a young adult new to managing money, I somewhat equated the state of my net worth with personal worth, or at least with my success at “adulting.” It was hard not to feel kind of worthless on a whole when our net worth was negative. I would never equate someone else’s value to their net worth, but I’d be lying if I said it didn’t bother me back then.

So What Changed?

Our goals.

Trying to get our net worth into the positive was really motivating when we had debt and a low net worth. Now that we’ve been debt-free for a couple of years and our net worth is firmly in the positive, the number is less exciting. I think that is because net worth is no longer an accurate measure of our goals.

The main way we intend to grow our money is with investments. We don’t want to go into real estate, or buy any other fancy big ticket items. We do own some larger items, like our cars and our house, but those items are not investments to us. They are utility objects, providing our transport and shelter. The cars have mostly finished their deprecation descent, and we intend to drive them until the wheels fall off. The house serves as a hedge against inflation, but we don’t expect to make a ton of money on it. We intend to live in it.

For us, then, net worth isn’t a very motivating measure anymore, because all it really comprises is our investment portfolio plus a few bigger-ticket utility objects. Better to simply cut out the fluff and use the amount in our investment portfolio as our yardstick, since that number determines when we will be financially independent.

So What is a Good Financial Metric?

All of this has me thinking, “What is a good metric for measuring financial success?” I think it needs to encompass a few things:

  1. Your metric needs to keep you honest. Any metric that lets you finagle numbers so that you can lie about the status of your finances is, um, not good. This usually happens when the metrics become convoluted. Net worth and portfolio size are fairly simple metrics to figure out. If you’ve having to bend over backwards with crazy formulas to prove your point, something is probably wrong.
  2. Your metric needs to motivate you. Whatever the metric, it needs to be motivating. Net worth used to be motivating for us. Now that our net worth is positive and should continue to grow for the foreseeable future, it is less motivating. Now investment portfolio size is more motivating, so we’re going to start measuring our financial success with that metric.
  3. Your metric needs to reflect your goals. Using your investment portfolio as the way you’ll measure you financial success if you’re a real estate investor is going to be  disheartening and inaccurate. The metric you use should show your progress in achieving your financial goals.

Have any of you ever found you were using a financial metric that did not really match your goals? What are some of the creative metrics you’ve come up with to keep you motivated?

Our 2017 Financial Goals

2017 is almost here, so it’s time for us to set some goals. We have three big money goals for this year:

1. Open Roth IRAs and Contribute 10% of Our Income

As I mentioned in our last monthly review, the first item on the docket is to start investing 10% of our income into our Roth IRAs. That means, first and foremost, having Roth IRAs. I opened mine with the payout from changing jobs a few months ago, but we still need to meet the investment minimum ($2500) to open an account for Mr. Steward. We’ll save part of that total this month, and our tax return should mostly take care of the rest. We should be able to achieve this goal in short order. Mr. Steward and I need to decide if we’ll immediately start contributing the 10%, or if we will wait until our next goal is complete. I suspect we will do the latter, although the former could pose an interesting challenge to our budget.

2. Get the PMI Off Our House

We bought our house with a pretty small down payment. While I’d rather focus on investing than paying off our house, we’re currently paying $600 a year in PMI to have the privilege (ha!) of borrowing money. The PMI has to go. It will take about $15,000 towards the principal to have 20% of the home’s purchase value covered. Part of that amount will come from our normal payments (which will become more effective in vanquishing principal the faster that we make additional payments), so I suspect we’ll only need to contribute more like $12,000 in additional contributions to make it happen.

3. Travel

This one is a little more nebulous, because it basically depends on family decisions that have not yet been made. Either we will need to go to Cape Cod for Mr. Steward’s brother’s wedding, or we will travel to Orlando around Thanksgiving for a family reunion. I don’t think we’ll need to do both trips. I have started hoarding credit card points, but I figure we’ll need an additional $1,000 to $1,500 for either trip. I don’t intend to start saving for this beyond credit card points (since we have an emergency fund) until firmer details have been hashed out.

All in all, those three goals comprise around $15,000 of savings and additional payments that need to happen this year. Historically we have been able to save that annually, even before I got a better job, so it seems pretty attainable. I’d love to see us smash these goals and get started on some new ones toward the end of the year.

What are your goals for 2017?

How Aldi Helps You Treat Yo’ Self (in the Right Way)

If you’ve been reading very long, you already know that I really love Aldi. I realized on my most recent shopping trip that the aspect I love most about Aldi is that it encourages seasonal living and discourages lifestyle inflation, at least in the area of grocery shopping

For those unfamiiar with Aldi, the bulk of the store is a fairly traditional stock of

aldikeychain
A Christmas gift from my bestie, because she gets me

foods that you would need to prepare, and they offer no brand choice. There is a set stock of goods that rarely changes in composition. (Thank goodness! The choice fatigue alone makes me want to flee traditional grocers.)

The last aisle, however, changes every week or two. One side of the aisle is home goods, and the other side is seasonal foods. Since we’re almost upon Christmas, right now it is full of all sorts of Christmas sweets and crackers. Two weeks from now, it will be something completely different. October always has an Oktoberfest theme, other months they’ll spotlight the food of a different country.

I love this feature of Aldi, because I feel like I am setting myself up for success in treating myself appropriately. Our grocery budget allows for treats from time to time, but I’ve talked before about how those treats rapidly become things we take for granted, and, for me, abstinence is better than moderation. Fortunately, Aldi offers enforced moderation. If I buy an item from the last aisle and I love it, I cannot be tempted to buy it forever, because the item will simply be gone. Most of the items are things I shouldn’t buy forever, since they are typically sweets or pre-packaged foods.

Moreover, my treat will be in time with the season. I can celebrate the time of year with a little something, then move on to enjoy the elements of another season at a later time. It’s a great lesson in a country where we are increasingly offered anything we want exactly on demand of when we want it. Moreover, the scarcity helps me to enjoy the treat more while I have it.

Aldi is not devoid of temptations in their permanent stock (I’m side-eyeing you, cocoa-dusted almonds). You also have to be self-aware enough not to “stock up” when items are in the last aisle. Overall, though, enjoying the last aisle at Aldi from time-to-time can help you to keep your treats as, well, treats.

What are some of the ways you try to curb “treat” spending? Also, have you tried out Aldi? What did you think?

How Not to Be a Scrooge This Christmas

You have likely noticed that Christmas is coming again soon, a delightful time of joy, expectation, family, and relentless consumerism.

For the past few months, the biggest questions in my personal finance Twitter feed have been either how to opt out of Christmas gift-giving altogether, or how to accomplish gift-giving on the cheap. I have heard otherwise very kind people complain when they didn’t receive an equally valuable gift in return to theirs. I have also read the mockery of those “above-it-all,” who refuse to descend into Black Friday shopping with the plebes. (Penny has a great blog on that topic here.)

Gift-giving is a fraught social currency, perhaps moreso in a community of fiscally-minded folks. Therefore, I would like to present some basic steps for how to chill-the-eff-out this holiday season, brought to you by my past personal humiliations and Scrooge-like behavior. Learn from my example, friends, and have a lovely Christmas.

Be Grateful

Gratitude should not be that hard. After all, someone took their hard-earned cash, picked out something you might like bought it, and gave it to you for free with an actual freakin’ bow on top. What is there not to be grateful about?

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The infamous machine

Nonetheless, I have been a complete jerk when it comes to receiving presents before. The first major gift I received from a non-family member was a sewing machine from my first boyfriend. I was sixteen, and my then-boyfriend had just joined the Marines. I had a sewing machine on my Amazon wishlist, and had mentioned many times that I would like to learn how to sew. So what happened when it arrived in a huge box on my doorstep?

I freaked out, and not in a good way. I told him his (what I perceived to be) extreme generosity made me very uncomfortable. I told him he should not have spent the money on me, but instead saved it for a variety of more important things he needed. His feelings were understandably hurt, and so began our first big argument. At the time I felt quite justified. Looking back, though, I see that my logic had a whole lot less to do with wanting the best for him monetarily, and instead had more to do with my own feelings of vulnerability and embarrassment at not being able to reciprocate on the same level. Frankly, at sixteen, I also did not understand the diminished scale of a few hundred dollars when someone is making adult money.

Now I try to be much more open-handed with gratitude. Regardless of the gift (and whether or not you feel the person can afford it!) the gift-giver deserves to be recognized for having thought of you positively. Moreover, I’ve learned that any fears about being indebted to the gift-giver is a really unkind judgment of them. Such thinking assumes that the gift-giver has a selfish spirit. Even if it were true, it is not a helpful way to think of others, because…

You Can Only Control Yourself

I’d love to say I learned from the sewing machine fiasco, but last year I again found myself scrooge-mcduck-sniffingfeeling like a flaming pile of poo in response to another gift-giving situation. Bean was tiny, and I was having a hard time adjusting to the sheer volume of stuff that seems to magically apparate along with a baby. My coping mechanism was to try to talk everyone out of spending money on my child in the days and weeks leading up to Christmas.

I remember the situation vividly. I was sitting down on my grandmother’s floor, facing the matriarchal firing squad of my mom, aunt, great-aunt, and grandma seated above me on the couch. They were discussing all the toys that were going to appear on my doorstep regardless of my wishes, because “that’s what grandparents do.” Yet again, I lost it. I told them all in acid tones that they could do that if they wished, but nothing would stop me from immediately taking it back out the door to a resale shop or disposing of it as I wished.

Now friends, I don’t think what I said was factually wrong. People aren’t allowed to make you feel guilty with gifts, or have a say over what you do with them after they’ve been given. However, throwing my annoyance in the gift giver’s face at the time or even before they gave me the gift is incredibly rude and ungrateful. It robs the giver of the appreciation that they deserved for thinking of me, just because they wouldn’t conform to my wishes. I behaved like a full-on dictatorial Scrooge.

Instead of trying to change what others do–because seriously, has anyone succeeded at getting grandparents to not buy for their grandchildren?–we now modify our own behavior. After all, that is the only behavior we can control. We buy almost nothing for Bean on most occasions. Instead, we try to do special things for her for no particular reason, and save for big future expenses like college. I still try to suggest experiences rather than things when asked for gift ideas, but in the end, we will smile, enjoy the love the gift is meant to convey, and deal with the physical stuff later.

Put People First

I think the care that frugal sorts give to thinking about their expenditures can lead us (or at least me!) to focus too much on the spending or “stuff” aspect of Christmas. Spending way less than the average person on Christmas does none of us any good if it is only a mechanism whereby to judge others who spend differently or feel self-righteous about ourselves. Any measures of cost-saving or frugality should be undertaken only if they help us focus on the more important things in our lives–faith and love.

Has worrying about what others spent or what you’re spending made you a Scrooge at Christmas? What are some of the problems you experience surrounding holiday gift exchanges?

Monthly Review: November 2016

Welcome to our monthly review! Every month or so I review the progress we’ve made on our goals and any frugal hacks I’m trying out. Older updates can be found here. The background on our money journey so far can be found here.

Goal Progress: The Emergency Fund

Balance on October 31: 13515.05

Balance on November 30: 15000

Change: 1484.95

We’re finally done! The PTO payout from my old job was more than enough to finish out this goal and begin to fund the next. Let’s celebrate with my favorite snake hips:

snakehips
$15,000 is a lot of cash to have on hand. We know we have certain expenses (e.g. new HVAC) that will arise in the next 5-10 years, not to mention surprise expenses. We have several priorities we want to accomplish before we start saving for those mid-term expenses. It’s good to know that in the worst case scenario, our family will be able to swing any emergency expenses in the meantime.

Note to self: Next time add the Hiddleston gif AFTER you’re done writing the blog… Mesmerizing.

The Next Goal

Now that our emergency fund is complete, the next immediate goal is to begin putting 10% of our income into Roth IRAs. (This is to go with the 4% we respectively contribute to our 401ks, which is doubly matched.) We want to go with Fidelity, where all of our other retirement savings now reside (see below). Unfortunately, the minimum investment for their total equity index fund is $2500. While my payout from the job switch is almost enough to open mine, we’ll have to save a few months to reach the investment minimum for Mr. Steward. We will singularly focus on saving for that until the account is opened, then dial the savings back to 10% to let us simultaneously pursue other goals.

Improvements

  • I rolled over my 403b from the old job. I wanted my investments to all live together and I didn’t feel enamored with my old plan, so I rolled my 403b over to a Fidelity traditional IRA. (My new employer is with Fidelity.) I am happy to have all of my investments living in one place for now. I have to admit, putting in purchase orders for the funds was much scarier than simply checking some boxes and adding percents in my old plan, but I’m happy with the outcome.

The Do-Betters

  • We need to make a decision about Christmas budgets. We spend like a typical American family at Christmas. This is a choice we make joyfully, because I love to give presents. I enjoy thinking about the person and trying to introduce things that remind me of them or that I think will make them happy into their life. Nonetheless, every January I tell myself that we will scale Christmas back, not because we can’t afford it, but out of my fledgling minimalist desires. So, I set our Christmas savings artificially low at the start of the year, then the amount we save climbs over the year as we get more excited. Next year, we need to simply decide in advance and stick to it. Cut back or don’t, but make the choice from the beginning.

That was our November in a nutshell. How did your November go?

Why I Spent More on Clothes This Year Than… Ever

I hate clothes shopping. Numerous friends tell me that they have entire closets full of clothes for different seasons and across different sizes. I am basically the opposite of that person. Both Mr. Steward’s clothes and mine hang on the same single side of our closet. I purposefully buy clothes with sleeve-lengths that can be worn year-round with the addition of layers. I also wear pretty much the same few colors, so that I always know that everything will match. (Shout-out to the genius who decided that capsule wardrobes are a thing, so I can pretend to be trendy and wise instead of just lazy.)

Clothes shopping is an anxiety-inducing experience for me. I’m nervous I’ll spend money on something, then decide I don’t like it a short while later. I believe this stems from teenage years, when my awkward body shape made clothes-finding hard, but I was still figuring out my “look.”

I also have a hard time wrapping my mind around the impermanence of fashion. (You’d think this would be a comfort, given my former concern.) Even if I take exceptional care of my clothes, there are very few buy-it-for-life clothing items. As someone who values maximizing the value of anything I own, I find the fact that clothing wears out to be really annoying. Often, I go shopping for an exact replacement of something I owned before, then rapidly become frustrated when I can’t find it.

Despite my hatred of clothes shopping, I have spent more money on clothing this year than in the previous five years combined.

Why Have You Spent So Much?

It turns out that post-baby bodies, even if you get back to your original weight and size, are shaped differently than before. My older clothes did not look quite right with my now more prominent postpartum belly, and I often felt self-conscious. Also, my old clothes were wearing out. I don’t mean they were slightly faded or a little stretched. I mean the underarms were worn so thin on some shirts that I couldn’t wear them without jackets over them. I had sweaters with hemlines that unraveled as I sat at my desk.

Moreover, I got a new job. My new workplace has a less casual dress code, so about half of the outfits that I wore previously were no longer appropriate. I also have more upward mobility in this position, so I felt it was important to dress the part of positions I would someday like to reach. “Dress like the person you want to be” and all that jazz.

What Did You Spend, On What, From Where?

I spent about $400 this year on clothes. Now, you may be thinking that is pocket change, or you may be bemoaning how I could waste so much money on something so frivolous as clothing. For me, this is a huge amount to spend. In the past five or so years, I have spent maybe $75 a year on clothing; usually just enough for a new pair of work shoes and perhaps a top.

My $400 got me two pairs of flats, a pair of boots, two dresses, a decorative scarf, a new everyday bag, three button-up shirts, a sleeveless blouse, three blazers, two sweaters, and two pairs of leggings. In rough numbers, I’d say 35% of the money was spent at a department store, 25% at a discount retailer, 15% at LuLaRoe, 15% to a charitable organization, and 10% at secondhand shops. To highlight what a huge markup new clothing prices have, half of the items I purchased were secondhand.

Anything purchased new were classic pieces that I knew I would wear until it they were completely worn out, such as a black dress for work, my everyday purse, or shoes. Everything else came from secondhand shops.

Was It Worth It?

Definitely yes. I did not realize, until I started regularly wearing clothes that made me feel good about my body and seemed appropriate for my surroundings, just how much unnecessary grief I was putting myself through by not parting with a little bit of money. I not only felt less self-conscious (which makes for one less thing to think or worry about), but dressing more professionally at work made me act more professional. By dressing like a high achiever, I found myself striving to achieve more. A classic case of faking it until you make it.

I think naturally frugal people (at least me!) can pat themselves on the back for not spending money when, as I’ve discussed before, this is actually a sign of dysfunction or miserliness. Frugality should be about maximizing the happiness and use you gain from the things you do buy, not refusing to buy anything altogether. I think I thought new clothes wouldn’t make me any happier, both because of the annoyance of having to purchase them, and also because I thought clothing was not something I cared about enough that it could enhance my life (at least relative to the cost).

Partly I was also buying into the minimalist/no-spend trend, which says purchases aren’t going to make a big difference in happiness. While I agree in principle, what I overlooked is that I already wasn’t looking to clothing to bring me happiness. I didn’t need a “reset” on spending I already wasn’t doing. I’ve learned that having a modest wardrobe of clothes that fit well and are appropriate to your day-to-day tasks is a joy, one I can offer gratitude for continually. Clothes are the things that are literally closest to us all day long. I’ve decided it’s worth it to ensure that those items are in good repair, appropriate to the situations I am routinely in, and pleasing to me. I can sit comfortably surrounded by threadbare sweaters and money I didn’t spend, or get over my self-righteousness and get a few items that will fulfill their function beautifully.

Do I expect to spend $400 on clothes for myself next year? No. But I also do not intend to let my wardrobe degrade so far before I purchase new items moving into the future. I’ve discovered that it’s worth the small effort and the slightly greater expenditure to find good clothes.

How much do you spend on clothing per year? Have you ever discovered a financial blind spot where spending a little more money did a lot of good?

Monthly Review: October 2016

Welcome to our monthly review! Every month or two I review the progress we’ve made on our goals and any frugal hacks I’m trying out. Older updates can be found here. The background on our money journey so far can be found here.

Goal Progress: The Emergency Fund

The end of October left us mighty close to achieving our emergency fund goal of $15,000!

Balance on September 30: 12925.95

Balance on October 31: 13515.05

Change: 589.10

The difference is deceptively low, since I deposited most of our October savings (including a surprise partial-check from the new employer) on November 1. We’re going to have a great party next month, though (hint hint).

Improvements

  • Ms. Steward got a new job! Woohoo! It’s with the same company that employs Mr. Steward. The job change was much-needed for sanity and upward mobility reasons, but also included a several-thousand dollar pay bump. I also have additional benefits that my previous employer didn’t offer, like a company gym and the ability to carpool with my hubby. Nonetheless, there will be a of financial shuffling in the near future. I’m not in love with my employer’s 401k investment offerings. They also don’t offer an HDHP plan, so goodbye HSA contributions. Nonetheless, I’m positive I can get it all sorted out (and, of course, will tell you all about it).

The Do-Betters

Frugal Experiments

  • I’ve been showering after morning workouts in the company gym three days a week. Hopefully this will mean I’m not only refreshingly un-gross for work, but also that I save a bit on our water bill. I’m still working out some of the logistical kinks. My gym bag is already so huge after I work out that I can’t zip it. That means it can’t support a blow dryer, therefore I have a wet ponytail all day three times a week. I blow-dry my bangs by turning a hand dryer up towards the ceiling.) Anyone have some gym bag hacks for me regarding carrying less, fitting more, or getting my hair to dry fast?

How to Choose Where to Give

I wrote last time about why we chose to give away 10% of our income even as we were paying down our debt. Now I want to talk about how to choose where to give. If we’re going to give away hard-earned cash, we want it to be used wisely. The organizations that will use it most responsibly are not always (in fact, I would say rarely are) those with sad commercials on the television.

So how do we choose where to give? I have a few pointers from my own experience.

Give to What Moves or Interests You

Are you involved in a particular organization, like a local church? Do you just love to  see plays and musicals? Could you eat Indian food every day of the week? Any of those interests, big or small, could be a great starting place for giving. Theatre lovers might support a local community theater troupes. Indian food lovers might use that as a basis for giving to charitable organizations that provide medical services to the poor in India.

A personal connection can help to you to feel excited about giving. Moreover, being connected to a group helps me to feel more comfortable giving, since I have a better idea of where my money is going. For instance, 10% of our giving goes to our church, not only because, as evangelical Christians, we feel that God has asked us to do so, but also because as active members we can transparently see where the money is going across the church’s staff and services, local missions, and global missions.

Give to Save a Life

If you struggle with having a desire to give (Mr. Steward is with you, there!), then there are some great rational arguments out there for why you should give simply because you live in the first world. Peter Singer, a utilitarian philosopher, has a book called The Life You Can Save. In it, he outlines the unique position that basically all of us inhabit as Americans or Canadians. We are so wealthy that we have the ability to save multiple lives over the course of our own existence, purely through giving away excess money that doesn’t serve to make us happier.

If you want to give and want to have the biggest impact possible, I recommend that you give globally. The amount of goods that a single dollar can purchase in some other countries is equivalent to a week’s wages in some cases. Global giving helps to ensure that you’re maximizing the good that your money can do.

Give to Reliable Organizations

Giving is important, but so is giving to trustworthy charities that will use your money wisely. Giving money to an organization that can’t manage it well is a waste of some of the impact your dollars can have.

For local organizations, such as a church or interest group, getting involved is the best way to see how the organization handles money. I have learned a lot more about how the Friends of the Library uses donations by paying the minimum to join and attending their meetings. I can feel confident about how my dollars are spent in part because I have a voice in making those decisions.

Global giving is a trickier proposition, since most of can’t fly to other countries at a moment’s notice to check up on an organization. Vetting these organizations can be hard, but there are a few websites that can help. Charity Navigator and Give.org evaluate charities based both on their financial stewardship (e.g. the ratio of money spent on program expenses versus administration and advertising costs) and on their financial transparency (e.g. how board members vote, donor policies posted on website). They can help you get a feel for whether or not a charity you might be interested in would do shady things with your money.

The downside of these websites is that while they can give you a sense of the transparency and fiscal responsibility of an organization, they can’t evaluate whether the work the organization does is worthwhile. In order to evaluate if that charity’s approach is the best approach or the most important need to be fulfilled, you’ll have to research the topic a little bit yourself. Overall, I think finding a way to give that makes real change in the world is a great payoff for a few hours of research.

How do you decide where to give? Do you use other resources to vet your giving?

Why We Gave Away 10% of Our Income, Even While We Paid Off Debt

For the last six-ish years, Mr. Steward and I have given away at least 10% of our take-home pay. We gave even as we were paying down debt. But wait, isn’t that crazy? If you’re indebted and giving away money, aren’t you effectively financing your giving?

To be fair, we did have a few caveats in our debt repayment story. Our money situation was not so tight that we were unable to eat or keep the lights on because of our giving. In fact, we were able to maintain a healthy repayment schedule on top of it. Additionally, since I was still in graduate school, my debt was not collecting interest. If either condition had been different, we likely would not have given so much. Nonetheless, giving slowed down our debt repayment plan. So why do it?

Gratitude is the Key to Financial Happiness

Giving with the assumption that you will get back is a poor reason to give. Nonetheless, I can unequivocally say that building that margin into our finances helps to keep us right-minded about our financial situation. In debt repayment (and when pursuing a frugal lifestyle) it is easy to think of all the things that you can’t have.

The fact is, pretty much any American or Canadian reading this blog is really, really, freakin’ rich. How rich? With my less-than-stellar gross salary alone (no benefits), the Global Rich List places me in the top 1.23% of people in the world. Combine the Steward household (still no benefits), and we are in the top .15% of the world population. Take a second and go pop in your own numbers. I’ll wait.

See? Hopefully you read on down the page, and noticed some of the impact that even a little bit of your spending power can have on lives in other parts of the world. Why should you care? I think there are a lot of selfless reasons you should be willing to give, but let’s talk about the selfish ones. Giving away a portion of our income was a tangible reminder of how we actually live in abundance–we have so much we can just give 10% of it to others and not miss it.

Living a life of gratitude is a key to attaining most of the things we want in life. Science is showing that practicing gratitude makes us healthier, happier, and more able to engage in positive social relationships. Most major religions posit gratitude as a key component of living out your faith. Gratitude also inoculates you against advertising. It’s hard to convince you that you need to buy x better product when you’re pretty sure your life is already totally awesome. For me, giving simultaneously fosters gratitude as I contemplate the things I already have as I write out the check, and is an expression of the gratitude I already feel. I am happy to share, when I feel like I have more than enough. It becomes a self-feeding cycle.

But Couldn’t You Give Later?

But why did we give when we were still paying off debt? The answer is fairly simple. Pursuing a financial goal is often a long slog. You need things to help you feel positive about money and your life. Giving can do that. Even if you cannot give money because you are in the “lights might get turned off” camp, you could give a part of your other asset–time. Sitting at a homeless shelter at night or building a home for someone not only helps someone else, but can help you to find the abundance in your own life even when times are lean.

Moreover, just as your bills keep coming, so do they persist for any sort of charitable organization. It’s easy to say, “I’ll give when I have saved up my millions,” but in the meantime, the work of the charity goes undone. That means children are dying from malnutrition or poor healthcare now, women continue to have terrible quality of life because of a fistula now, or malaria wreaks havoc on a population that cannot afford mosquito nets now. That is why, for me, it has been imperative that we continue to give generously through all stages of our wealth-building process.

I’ll talk a little more soon about how to choose where to give your cash. In the meantime, would you give money away while still indebted? Do you give now? If so, to which organizations do you give?

How We Almost Made a $3,000 Mistake

Yesterday, Mr. Steward and I almost made a very big mistake. Let’s back up a little:

A few days ago, Mr. Steward casually mentioned, “A guy came to the door for a construction company looking to do work in the neighborhood. He offered a free quote, so I scheduled a time for them to come by.” To which, I say, “Wait, what, why?” His thinking was that getting a quote for work we do intend to do someday couldn’t hurt. He said that he was very straightforward with the gentleman, making it clear we did not intend to actually do the work anytime soon. I still did not feel super comfortable with it, but I relented.

Fast-forward to yesterday night. A different guy arrives on our doorstep, and he seems nice enough. We make small talk, and he asks what he can do for us. What ensues is a two hour high-pressure sales pitch from a man we become increasingly aware is a trained salesperson.

He pulled out all the stops: His employer does better work than anyone. We are getting a special deal because of the visibility of our corner lot and the beauty of our house, because they want advertising in the neighborhood. We can’t subsequently tell anyone the price we paid, though, because it’s too good of a deal that we get for being advertisers. The price rapidly descended 60%, but we could only have the special price if we could agree that night. If we did, we would get a special discount forever that we don’t get if we don’t the deal right now.

This is when, due to the raging alarm bells going off in your mind, you say, “Oh man, obviously sketchy. No way…” But I tell you, friends, we did it. We signed a contract and gave him info for a down payment. I wish I could explain exactly why, but honestly, I’m still not sure. There was miscommunication between Mr. Steward and me, which I will talk a little more about below. Part of it was, as much as it genuinely hurts to admit it, falling for the sales tricks, particularly the fear of missing out on that special snowflake discount. Mostly, I panicked, because I had no information but felt pressured to make a decision.

So Was it Actually a Bad Deal or Super Sketchy?

I don’t know, and that is the problem. We rapidly realized that we had allowed ourselves to be pressured into making a decision with insufficient research. It may have been the deal of a lifetime, but we were asked to pull the trigger on construction that we had only nominally considered prior to a stranger arriving on our doorstep. I have never made any big decision without over-researching it the past. Moreover, we have other goals that we need that money for!

Thankfully, the full depth of our ignorance struck us pretty much the moment we talked to each other. Moreover, we both realized we misread how much the other was interested. We immediately signed the cancellation agreement (which they are federally required to accept without forfeiture of down payment for three days after signing the contract), and overnighted it back to them this morning. I also called today, and the customer service representative assured me that the money should not be charged to us at all. We’ll see.

The postage to make sure it will arrive tomorrow morning cost $27 in stupid tax. As long as that’s all I ever have to pay, I will consider it $27 spent on a life lesson and some blog fodder.

What Did We Learn From Almost Being Taken For A Ride?

  • We don’t make major purchases without time to do research first. This has always been a fact about us, but this experience has taught me to elevate this statement to a matter of principle. In the future, if anyone pressures me to decide immediately, I’m done doing business. Prices and quality of work should be something that businesses are able to stand behind while you do your due diligence. If they cannot wait, we are incompatible with one another.
  • Don’t think that because you’re a “money person,” you’re immune to a sales pitch. I’ve always considered myself pretty good at resisting marketing efforts. This experience made me realize that my success likely has more to do with not putting myself in a position to see advertising in the first place. We don’t watch commercials, our computers block ads, and I politely, but firmly shut salespeople down before they get started. We have actually so insulated ourselves from sales pitches that I don’t think we knew what to do when we found ourselves in the middle of one.
  • We need a salesperson game plan. On the occasions when we have to deal with a salesperson, Mr. Steward has learned that I am not as hard-nosed as he expected. Although I easily shut down conversations initially, I become obliging if forced to participate. (I blame it on being raised in the South.) In the future, Mr. Steward will take the lead with any salespeople, and more aggressively carve out space for us to check in with one another alone.

I hope you can learn a little from our near-miss (we hope!) with a bad decision. Do you have any stories of being talked into something you should not have purchased? Make me feel better, people!