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I mentioned a few months ago with my year-end balance sheet that I would soon be changing the way I report my finances publicly. These monthly reports have been a relatively consistent part of Consumerism Commentary since I founded this website in July 2003. One of the original purposes of this website was to help myself take control of my finances and learn more about managing my own money.

After a while, though, the net worth reports, which include not much more than an accounting of my bank account and credit card balances, became less meaningful. At the same time, I stopped myself from reporting my income figures due to the complexities with dealing with a private transaction. I’ve decided to turn back to basics with the monthly reporting in order to focus once again on reducing my expenses.

The report below includes the last six months of my expenses after taxes and not including a few items like charitable contributions and business expenses. It will provide a good baseline for moving forward and determining where I can reduce my expenses and where I can compromise and allow myself more leeway. I’ve already done a good job of eliminating unnecessary expenses in order for me to enjoy certain things without stretching my budget, so reducing expenses might not be as important right now as monitoring my spending to ensure I’m not being wasteful. Continue reading to see my expenses.

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Improving your financial situation requires more than just trying harder. People who write financial websites offering advice often think or imply that the reason for financial misfortune is ignorance of the basics. Recently, there was one website that claimed that the only thing people need to know was spend less than you earn, as if taking this to heart is the single solution to getting your finances on the right track.

There is no switch that you can just turn on, for the most part. In some cases, particularly where someone experiences a major emotional setback — “hits rock bottom” — changing your direction in place works, but that could mean losing a house or destroying a family relationship. A devastating situation isn’t guaranteed for everyone and you may not want to wait until you reach such a low point.

MoneyIf you’ve been living in debt for the entirety of your adult life, you may have an epiphany of some sort and turn yourself around with just the knowledge that your net worth needs to increase at the end of each month in order to become financially independent, but for most people, changing behavior takes much more than desire.

There are certain things you can do to help yourself — and your brain — accept that you need to start improving your financial situations for the sake of your future self and family.

Replace old habits with new habits

Much behavior can be reduced to patterns and habits. Breaking a habit, like emotional spending, can be incredibly difficult because of the comfort that has developed through years of participating in the activity. Shoppers who derive pleasure from spending money may be in uncontrollable debt, and use shopping in difficult times to feel better. Of course, with more shopping and spending more money than is available, this person could experience emotionally difficult situations due to the lack of finances, yet still seek to cure those negative feelings by shopping.

Replace the reaction of shopping with something that makes you feel better without damaging your personal finances. Exercising releases chemicals in the brain that, for many people, enable happy feelings, so one of the best options for replacing a bad financial habit is exercise. Whenever you feel the urge to do something that you know is harmful to your finances, choose to run around the block or work out in a gym.

It might be difficult to make this change at first, but the goal is to make a new habit that can be triggered in place of your old habit. For some time, you may want to overlap both reactions, but after several weeks of consciously using your new habit, you should be able to successfully replace the old.

Resist temptation by making it difficult or inconvenient

Some financial advisers and gurus suggest freezing your credit card in ice or keeping your emergency fund at a bank that’s difficult to access. The more barriers you can place between yourself and your bad financial behaviors (in this case, using your credit card or dipping into your emergency fund), the more success you’ll have in avoiding these temptations.

Combining barriers with habits can be successful, too. Rather than purchasing items from Amazon on impulse, create a habit of waiting 24 hours between your desire and your action. This barrier of time gives you the opportunity to re-evaluate your decision. Twenty-four hours later, you may be in a different mood and decide that you don’t need the item you intended to purchase as bad as you thought you did.

Remove barriers to good financial behavior

While you’re adding barriers to prevent bad financial behavior, you may want to think about whether you already have barriers preventing you from making good financial decisions. Although the stock market has been on a rally lately, medium-term performance has not been great, and the investing industry has attracted a bad reputation through and following the recession and credit crunch. The fear of losing money may be preventing young people from investing in the stock market.

Many investment advisers say that you should evaluate your risk and only invest in a way that makes you comfortable with your possible losses, but an investor’s level of risk aversion could be tied to his or her feelings about the stock market. Risk profile measured this way would then fluctuate. One possible outcome from feeling good about the stock market and willing to take on risk during times of confidence about Wall Street while feeling nervous when the media is taking the financial industry to task is the unprofitable accidental strategy of buying high and selling low.

If you’re young and would like to save for retirement, with a goal of leaving your work behind one day with enough money to pay your expenses, you can’t ignore the stock market. A diversified portfolio may not make you rich over time, but there’s a good chance you’ll be able to retire.

Change your words

The words you choose to describe your financial behaviors will have an effect on your approach to your money. For example, take “investment” and “expense.” I mentioned this phenomenon in my editor’s note after Jennifer Calonia’s article about wedding planning and spending.

One way people often justify or rationalize expenses is by calling them “investments.” For example, one might say, “Spending a large amount of money for a wedding is an investment in your relationship.” Someone else might say, “Going to a private university is an investment in your future.” You should only invest in something when you receive an asset in return, and you are planning for the value of that asset to increase over time.

You may be able to argue that the asset you receive in return for a wedding is a partner who stays with you for the rest of your life. You may receive an emotional asset in return. But in order to be truthful with yourself, consider whether you’re using the term “investment” to justify paying more for a ceremony than you need to. As I’ve written previously, spending money for once-in-a-lifetime event is not a bad way to spend money if you can afford it, but calling it an investment is just a way for you to feel better about your resulting lack of money.

In return for your expense for your college-level education, you may receive assets: your ability to earn an increased income over time when compared with someone with just a high school diploma, possibly, cognitive skills that help you succeed in the world regardless of your job, career, or income, and, possibly, connections that you retain for the rest of your life, helping you with career moves and friendships. The values of these things may increase over time, making the term “investment” more legitimate. The trouble appears when you pay a higher price for education than necessary, calling it an investment.

If you ask anyone who has any experience with finance, a house is an asset and a mortgage is a liability. Yet, some financial gurus continue to insist that a house is a liability. This doesn’t make any sense from a purely financial perspective, but if you look at the connotations of the words instead of the meanings — or if you look at the broader sense of “liability” rather than its financial sense — these gurus might have an argument. A house that does not create cash flow for you (that is, a house that is not an investment with rental income) should be avoided as much as possible. Anything that costs you money is a liability in the sense that is drags your finances down. Although it’s not financially accurate, considering bad assets “liabilities” encourages you to eliminate as many of these as possible and to replace them with income-producing assets.

Politicians and activists use word choice to influence their constituents’ opinions all the time. That’s why we have terms like “pro-life” and “American Recovery and Reinvestment Act.” It’s a form of manipulation, but if you’re using this technique to benefit your financial situation, no one can blame you for misdirection.

Using these tricks — replacing old habits with new habits, adding barriers to bad behaviors, removing barriers to good choices, and changing the words to describe what you do — can help you overcome the difficulty of putting what you know about “spending less than you earn” into effect. There’s a bridge between knowledge and action, and unfortunately, many people mistakenly think that the reason so many people in the United States are suffering financially is due to lack of knowledge. The prescribe solutions like money management class in high school and other financial literacy initiatives. Having more information is not going to solve financial illiteracy. On an individual or family level, taking steps to modify behavior will certainly move finances in the right direction.

khrawlings

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How to Love Cooking

This article was written by in Frugality. 44 comments.

This is a guest post by Forest from Frugal Zeitgeist. Forest writes about frugality, finance, minimalism and lifestyle. In this article, Forest shares his experiences in the kitchen. Cooking great meals is a great way to save money and stay healthy, but it’s a skill that I haven’t developed for myself. Passion can boost motivation, though, and this article might help me find that passion about preparing meals.

When Flexo wrote about alternative financial resolutions he mentioned the idea of cooking more often at home. Cooking at home is often described as a way to save money. It will do that if you replace your dining-out habit, but it does much more than just improve your finances. Cooking can quickly become an enjoyable hobby, and when you get into the groove you can even use it to impress your friends. The health aspects cannot be overlooked, either. Replacing processed foods and restaurant foods with home-cooked versions, where you know the ingredients, will affect you and your family’s diet in a positive way.

But you can’t just expect to fire up the stove and produce an award-winning dish. Learning to cook takes time and patience. You will fail, and you will find that at times cooking isn’t as economical as you originally thought it would be. Investing in a stock of spices and speciality ingredients can quickly blow a shopping budget!

In this post I want to share my journey into the wonderful world of cooking at home and then hopefully convince you to make it a regular activity and a beloved hobby.

How I found my passion in cooking

ToastI never learned to cook anything as a kid. My kitchen wizardry stopped at being able to “cook” a perfect slice of toast and heat an egg in hot oil. Sometimes I would experiment, but I’ll skip the tales of my candy-bar sandwich and curry hot chocolate. When I moved out of my parents’ home at the age of seventeen, I sucked at cooking.

Luckily I had a corner store within twenty seconds of my house. I became a wiz at putting plastic-wrapped steak bakes and hamburgers into the microwave, and later I even progressed to turning on the oven to warm up a frozen pizza. Breakfast cereal was a favorite dinner of mine too. Cheerios for dinner! Yum!

This went on for quite some time. When I turned eighteen and started to throw regular pints of beer into the mix, my belly decided to grow big and round. Through the age of twenty, not much changed apart from my pants size.

Weight is easy to put on and reasonably easy to fix, but the bad habits had been affecting another aspect of my life, something not immediately apparent to most around me. As my belly grew, so did my overdraft. My money situation wasn’t going too well.

In addressing the cash flow problem, I knew I had to make all sorts of cut-backs. It wasn’t exactly a secret to me that my processed food habit was costing me a lot of money and I decided to tackle it by learning how to cook at home. This was also around the same time that I became vegetarian, which seriously reduced the selection of ready-made foods I could purchase at the corner store.

One of my first trips to the supermarket after the decision involved me stocking up on spaghetti, cans of tomatoes, dried basil, salt, pepper and lots of fruit.

I remember throwing myself head first into cooking, just like the way I refused to read instructions when I got a Transformer for Christmas. I didn’t read any cookery books.

For one of my first home cooked meals, I threw a few cans of tomatoes into a large wok with a little oil. I tossed in a load of basil, a little salt and let it simmer for quite a few hours. The result was better than you may think for a first attempt, and although the work was minimal, I enjoyed throwing some stuff in a pot and coming out with an edible meal. I was intrigued enough to learn more.

I continued to develop my “tomatoes and stuff in wok” speciality and would try adding different veggies and herbs. One important thing I did do was learn the basics. This included cooking eggs in their various forms, the basics about herbs, simple stir fry, fried rice, stews and chilis. Occasionally I would follow a recipe.

The big change for me came when I quit my job and moved from England to Canada. I found food to be even more expensive in Canada, and my budget was very thin. I had left behind a high-paying job in London and was now washing dishes in a pub kitchen. Of course being around cooking all day was part of my inspiration, but working out how the hell to feed myself on minimum wage was the real kick in the butt.

I started to buy a lot of raw ingredients and had moved in with my girlfriend. A student and a kitchen boy needed some entertainment and that was where Manjula came in! We enjoyed making dinner together, even though it was stir fry most nights. Cooking with your family and friends can be a lot of fun and a motivation to push yourself forward. We both enjoyed curry so we learned how to cook it properly. I started to search for recipes online, and I discovered Manjula’s Kitchen on Youtube. Manjula cooks a lot of great Indian dishes and her lackluster commentary creates a homey, “I can do this” vibe that I found quite warming. After my first Manjula curry I was hooked.

I was being reeled into this cooking thing.

When you make that great meal, something you never thought you could make, it’s like you finally get it. Cooking can be drudgery, especially when you have to cook for many and you just don’t enjoy it. I look at it like painting. Painting a house is boring as hell, and the outcome is nice, but nothing special. Paint a picture and you enjoy the whole process and the outcome immensely. If you approach cooking like painting a picture you’ll enjoy it very much.

TortillasNext up for me was my other favorite food, bread. I had a drunken conversation with a Mexican lady who convinced me tortillas were just flour and water cooked in a flat pan. I had flour and water at home so a day or so later I mashed them together into a dough, rolled them into tortilla-shaped discs using a Snapple bottle, and fried them in a hot pan. Like my very first tomato experiment, it worked again — not perfect, but within reach of being able to be called bread!

This put me on a bread kick and I turned to the internet for a real loaf. The first recipe I ever used is one I still use today, and variations on the dough are easy to experiment with. There is something calming about kneading dough and something very satisfying about eating it hot out of the oven.

Where I am today?

I cook almost every day. Cooking is a hobby and something I do almost without thinking. I’ll happily tackle any kind of cusine and challenge myself to new recipes on a regular basis. I’m not afraid to pick up something I have never seen before and experiment with it. I still make a lot of mistakes but that is half of the fun.

Along with my confidence, my knowledge of food sourcing and nutrition has increased. I try to buy in-season foods and balance my diet with meals that contain the right amount of carbs, proteins, good fats and all of that stuff.

I absolutely adore cooking. Food is something we all need, but good food is something we all love. The smugness and satisfaction from being able to match meals at your favorite restaurants is unbelievable. Cooking isn’t an art or skill that only a few people have, it can be learned. If you keep at it, you will learn. You’ll want to share your new-found love with friends, and they’ll get the bug too.

Tips to start cooking

Starting off any new endeavor that you hope to grow into a hobby can be tough work. If things don’t work out the first time, it is easy to give up. Often, fear of failure, poor early results and lack of time push people back to TV dinners and prepared meals. Like any feat you want to achieve, you need to go in knowing that you will fail, you will make terrible food, and your journey from a person who reads recipes to a full-fledged cook will not be linear.

Making failure part of the learning process will guard your self-esteem enough to help you get through the rough patches. Set goals and make time for cooking. Instead of going to the pub, stay home and follow a recipe, bake a cake for the family, or go shopping for a cook book.

I would suggest you set goals centered around being able to cook your favorite meal or a favorite meal for your family, learning to cook a few dishes of a certain cuisine, or replacing a regular store-bought item with a homemade alternative. The goal should be something that matters to you and keeps you focused. A solid option is baking bread that is better than the store variety. It’s not easy but a skill that is a lot fun — and messy — to learn.

As your cooking progresses something will happen. Your lack of confidence will subside and you’ll fall into the groove I mentioned earlier. For me, indicators of this were being able to add ingredients without measurement and being able to open anyone’s pantry and put together a meal without a recipe book. At this stage, you won’t be a master chef, but you’ll be competent and confident enough to take on any recipe.

Experimentation is very important and is key to discovering the joy of cooking. If you think chocolate and chili pepper would be good on pork, try it. If you are bored at home, just grab some random ingredients and see what you can cook up.

Make cooking social

Keeping cooking a lonseome pursuit could stop it from progressing into a full-fledged hobby, so it’s important to share. Sharing the cooking and eating experience with friends and family is one of the best parts.

I remember baking cakes as a young kid with my grandma, and I think baking and cooking with kids is a great learning tool. I wish cooking with my parents had been a part of my whole life. Cooking with your partner also brings in a new intimacy to a relationship and shares a responsibility that is often left to one person, most often the woman.

Expanding beyond family, it’s great to host potluck meals or host a dinner party on rotation. Friends of mine set up a little club where four couples set four Saturday nights aside. Each Saturday night, the eight people would all visit one house, and the hosts would cook a three-course meal. The result was that it pushed everyone in that group to try to up their cooking game, and it was somewhat competitive. The dinner parties were successful enough that they have all improved their cooking skills.

Get started

AsparagusI hope I have you convinced to give it a try and I hope you have overcome any apprehension. You may not even enjoy cooking at first, but you’ll enjoy the challenge. Here are some tips to help you get started. Please come back to let us know how it went.

  • Cook a basic flat bread that can be used for lunches, side dishes and more.
  • Bake a real loaf of bread. This is the very first basic bread recipe I ever used, and it’s good.
  • Find an online video recipe for your favorite restaurant meal and try to make it.
  • Use the ingredients in your pantry and create a random meal. It doesn’t matter if it turns out bad, just mess around!
  • Try another favorite dish or two from another part of the world.
  • Invite a friend over for dinner and you cook. They can bring the wine.

Good luck with your new money-saving, healthy hobby.

Please don’t hesitate to ask any questions, or ask for any resources, ideas or anything that comes to mind. If you love cooking, what inspired you to start?

Photos: John McClumpha, jeffreyw, woodleywonderworks

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Your personal human capital is an essential part of evaluating your overall worth. Human capital has a number of definitions, but in this case, it refers to a measurement of who you are, particularly in relation to how you might be seen as valuable to an employer or a client. This isn’t the only way to define a person, but since it ties directly into your future earnings and your potential net worth, it is related to finance and shouldn’t be ignored. It’s as important, or even more important, than your net worth measurement.

Consider two job applicants with identical technical skills and education, both pertaining to the job description, and a similar personality that could result in either choice being a good fit for the company. One of the applicants has indicated that he has often been called upon to present information about hie field to the public. Having presentation skills can make a prospective employee more attractive to the employer. The ability to eloquently, entertainingly, and comfortably lead a discussion or present information in front of an audience can open opportunities.

Anyone can throw together a Powerpoint presentation together, but delivering that presentation isn’t as easy as reading the bullet points. Anyone can write a speech, but elocution is a skill that requires careful honing.

Most people in “business” head directly to Toastmasters. Toastmasters uses a standardized curriculum and a safe practice environment that allows people to receive the education and experience they need to take their presenting skills to the next level. My former company, at the satellite location where I worked, had an internal Toastmasters group. We met once every two weeks to critique each other’s speeches or presentations and gain experience speaking extemporaneously about random topics assigned in the moment.

Outside of Toastmasters, you can gain experience speaking and presenting by organizing an event in your community. Libraries offer these opportunities as do community centers and religious organizations. If your field of interest holds conferences, try to get on the schedule of speakers.

Public speaking is acting and performing

Stage fright is a common barrier to increasing public speaking experience. There are two keys to overcoming stage fright or performance anxiety: being overly prepared and breathing properly. Even though the solution is simple, it isn’t always easy. Even veteran actors deal with stage fright, so it isn’t something that is easily cured even it can be managed. Acting experience can be beneficial for public speaking, as many of the skills are similar. In addition to acting, any kind of performance experience — music, dance, etc. — can have positive effects on confidence and the ability to successfully deliver a speech.

Acting also helps develop a performer’s presence. If you’re speaking publicly, you’ll need to have a presence that’s informative and trusted. The best speakers are sometimes described as “larger than life.” You know when they walk into a room that whatever they have to say will be worth hearing.

Actors develop emotional communication skills. Without saying a word, an actor can convey an emotion. The audience will be able to understand what the actor is thinking or feeling. Skilled actors can transmit those emotions to the audience, so the spectators can sympathetically feel what the actor is feeling. This is an invaluable skill for speakers. It could mean the difference between a good presentation and a speech that has the audience on the edge of their seats.

How do you suggest gaining public speaking experience?

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Boost Your Human Capital: Get Involved and Volunteer

by Flexo
Habitat for Humanity

Consider your personal human capital as an addendum to your net worth when evaluating your overall worth. While your net worth is a good financial measurement, your human capital is a good predictor of how you’ll handle opportunities to grow in the future. In an unsteady economy, those with better developed human capital have an ... Continue reading this article…

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Offering Your Services for Free

by Flexo

For anyone interested in starting a business, particularly in creative arts, is building up a reputation in the field. I mentioned that my goals for this year include doing two photography shoots each month. Over the past few years, my interest in photography has grown from a hobby to a serious interest to a potential ... Continue reading this article…

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Earn More Money: eBay Selling and Flipping

by Flexo
Book Sale

This is the second article in a series about methods of supplementing income with spare-time projects. I typically focus on the big changes people can make that result in earning significantly more money, but this series focuses on incremental income. The first article was about becoming a secret shopper. A friend of mine is stuck ... Continue reading this article…

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America’s Lost Decade

by Flexo

Larry Summers, former economic adviser to Barack Obama and Treasury secretary under Bill Clinton’s presidency, shared his thoughts on the economy through opinion pieces in the Financial Times and Washington Post. His concern is the possibility that the United States is heading for a “lost decade” similar to Japan’s lost decade in the 1990s. This ... Continue reading this article…

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