Maximize ROI & Saving Tips

Personal finance types, myself included, often recommend making small lifestyle changes to save more money for retirement.  A prominent example is the latte effect, which holds that cutting out a daily cup of coffee can theoretically save 1,000’s of dollars (it can).  This kind of advice, however, really gets under some people’s skin.

Take Annie Lowrey for example, one of my favorite economic reporters from the NY Times, now working at NY Magazine alongside another of my favorites (on the political side), Jonathan Chait.  Lowrey recently had a feature on Mr. Money Mustache, but before that she published a short critique of the latte effect advice typically dished out by personal finance gurus.

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Without a doubt, car commuting is the Enemy of the early retiree.  Using a car regularly is costing you BIG dollars and keeping you on the financial treadmill longer than necessary.  Not that I don’t understand the allure of car ownership.  The car lifestyle is extremely convenient and enjoyable, but it is very clear to me now that it just isn’t worth the cost.

This is an important topic, so I plan to cover it in two parts.  This is the first part and looks at how much money you would save by getting rid of your car completely in favor of other modes of transportation.  The second part will be a similar exercise, but less severe since it assumes you keep your car and just use it less frequently.  The idea is that a 2+ person household could more easily eliminate one of 2+ cars while a single person household is more likely to simply use a car less.

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While a few people in the personal finance blogosphere might truly believe that budgets are sexy, most people probably think of budgets as a pain in the ass, and I would tend to agree.  The thing is, however, if you have ambitious savings goals, you probably really need a budget to help you stay on track.

Budgeting depletes your willpower by pitting long term goals against immediate satisfaction, causing psychological and emotional pain and sometimes even aggravating otherwise healthy relationships.  But, hey, if it was easy, everyone would be doing it, and we would have a lot more 40-year-old millionaires.

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How long would it take you to become a millionaire if you were maxing out your tax-advantaged retirement accounts and nothing else?  What about if both you and your spouse were doing that together?  And when would you be able to retire?

Maxing out retirement accounts is not easy by any means, but it is a really nice concrete goal to shoot for.

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What is the better choice for mowing your grass… a manual push reel mower or a walk-behind gas mower (push vs. gas mower)?  It really depends on your situation and priorities, but for the average joe, a push mower probably saves more money even though it takes a little extra time.

Push mowers have a lot of other benefits as well, including being much better for the environment, producing less noise, and keeping your grass healthier with cleaner cuts.  But they do have downsides.

In my experience, manual push reel mowers miss a blade of grass here and there, and when the grass is really long the problem gets worse.  And forget about chopping through small sticks and yard debris… this stuff will just dull the blades and jam the mower.

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Welcome to my first READER REQUEST.  I love ideas for new posts, especially from readers. This is my inaugural reader request, and I hope to do many more going forward.  A big thanks for the inspiration…

In this ROI analysis, I’m going to take a quick look at whether or not a smart thermostat such as the Nest Learning Thermostat can save you money.

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Ah, a quintessential image of American manliness, a dude changing his own oil. Grease-stained jacket, crew cut, work rag, socket wrench in hand. Self-sufficient to the max, except the part about needing a very expensive piece of machinery to get from point A to point B.

Not that I have any room to judge; being a two-car household means we need our fair share of oil changes too.  On average, I would say that our vehicles get their oil changed a little under two times a year, although it should be less now that I started biking to work more often.

Oil changes aren’t a huge yearly expense, but forking over that $30 dollars is never fun.  What is even worse, however, is forking over $100+ dollars for all the extras you think you need.  I’m talking new cabin air filter, transmission flush, reverse light, etc.  Anyway, the point is, if you can save some money doing it yourself, why the hell not?

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I have been wanting to cover this topic for a while now because it is pretty fun and lighthearted. Luckily I got just the nudge I needed last week when my Dad decided to try his hand at home-brewing.  A few years ago, this would have surprised me, but I have come to realize that my parents keep getting cooler and cooler with age.

So of course I got him to fork over the cost and time details for his first batch of hefeweizen, and I hate to break it to you, but from an investment perspective, it ain’t pretty.  But, really, who is brewing to save money?  Not me, and not most of my friends.  Brewing is a DIY activity that most people enjoy and take pride in, in and of itself.  Sort of like cooking, but cooler and more populist.

I mean, being able to whip up a soul-warming pho or some homemade sweet plantain arepas is pretty sexy, but nothing sells like making your own beer.  It just appeals to the masses.  Beer is the great unifier… even people at The Harvard School of Public Health say you should probably be drinking more of it.

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It is about that time of the year again.  What has been a relentless winter for most of the U.S. is slowly giving way to green sprouts and flowering buds.  Spring is in the air, and gardening season is upon us.

Don’t be fooled by my introductory rhetoric, however.  I am not a gardener.  Last year was our first attempt, and even in the temperate, lush Portland climate, there wasn’t a green thumb between the two of us.

Our poor results last year were a big motivator for this post.  I was hoping to find out that gardening isn’t worth it, but sadly, it appears that it (barely) is, or at least can be if you plan well.  Last year we planted beets, pole beans, cherry tomatoes, and squash in a small raised bed.  The only crop we harvested reliably was the squash.

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Here’s the dirty little secret you won’t hear too often in the early retirement community: income matters, A LOT.  A typical handling of the income conundrum goes something like this: “Yeah, it can be hard to retire early / save a lot with lower incomes, but it is still possible if you are determined.”  The sad reality that this attitude conceals is that, while it still may be *possible*, retiring early with a low-to-average income requires significantly more sacrifices.

Specifically, the average American household earning $50k per year probably won’t be able to retire in less than 30 years, even with a budget similar to Mr. Money Mustache, unless they are willing to give up some other basic necessities, which is asking a lot and living a life out somewhat out of balance in my humble opinion.

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