We got a storage unit. I broke my own rule. If I keep this up, next I'll be getting cable TV and running up credit card debt on professional manicures and iced coffees. Then we'll never be able to afford a vacation again! Okay, who am I fooling? None of those things will ever happen. I like money way too much. We got a storage unit because there was actually a sound business case for it.
When we went to the storage facility, I interviewed the manager. I am helpless against my fascination with the curious American phenomenon of storage units. About ten percent of Americans rent a storage unit. To me, that is huge, especially because a lot of those units are shared by couples or families. It would be really interesting to know the number of individual adults who rely on storage outside their main living space. Go ahead and add in all the adults who store stuff at their parents' house, why don't you?
Some people use their storage units as part of their workday. The facility we used apparently had a few contractors, painters, and landscapers who stored their tools and materials. That makes a lot of sense for security reasons alone. Access for a truck is probably easier than at most homes. Someone could rent a cheap, small apartment and still run an equipment-intensive business. This all came as a surprise to me, because in my professional work, I had never before known of a storage unit that actually earned its keep. What a truly novel concept.
Our storage unit didn't pay for itself. At least, I assume it didn't. The purpose was to enable us to move as quickly as possible when my husband got a great job in a new city. We had only twelve days to make the move. We decided to store our stuff and stay in an Airbnb while we looked for a place. This was a matter of convenience that cost us about $300. The breakdown was two van rentals instead of one, and the price of a month's rent on the storage unit. It would be nice if we had gotten prorated rent, but there wasn't any margin in that for the storage facility. Why not rent out our nicely broom-swept unit twice in the same month?
Is it possible that we broke even on this deal? Maybe. It's hard to know, but maybe.
With our backs to the wall, desiring to move our stuff directly from our old home to a new home, we might have made an expensive choice. We might have grabbed the first option we saw. In our experience, the rental market in our region is very tight, and even calling within three hours of an ad posting is no guarantee that the place is still available. We got our last place because we were the first of 83 callers; I saw the listing within five minutes of posting, and my husband arranged to drive over to look at it moments later. We definitely would have made an offer on the very first place that remotely met our criteria and took parrots. There are three options in this scenario: pay the same, pay more, or pay less. This city being what it is, you get less for more money, like tapas or sushi.
Paying less is usually not paying less. There are plenty of run-down properties on the rental market here, many evidently in such bad shape that the ads don't even include photos. What you get in a shabby, older rental house is the worst of everything. Poorly weatherized with old, inefficient appliances, running up your utility bills, usually adding insult to injury by having slower internet, too.
The $300 we spent on double moving vans and a month of storage works out to $25 a month for a year. That could go up like a flash in the pan. In the context of rent or energy inefficiency, it's barely noticeable. There's no way to know, but it's entirely possible that this finagling of the storage unit actually did pay for itself. More likely I am just trying to make up a nice little story to assuage my guilt over "wasting" money.
We sold our car back to the dealership this month. This is salient. We knew when we planned this move that we had a large windfall check coming our way (two cheers for Volkswagen) and also that our monthly expenses would be dropping. We could afford to do something ridiculous like move all our worldly goods twice in eight days, knowing that this would be a one-time expense.
This story has a happy ending. We found a great apartment right on the waterfront. It's super tiny, even smaller than the tiny house we just vacated, but the location really can't be beat. We can walk to the library, grocery store, dry cleaner, hair salon, post office, pharmacy, and pet supply in less than half a mile. Having that buffer of time to look at rental listings and visit the neighborhood in person made all the difference. It was worth the extra two days of schlepping and hauling. It also gave us time to do another round of culling on our stuff after we had seen our tiny new space.
The sad ending with most storage units is that people get them without an exit strategy. Nobody ever chooses an end date. There are people in my life who have spent over $10,000 on storage units over the years, and people who have lost the contents to auction, and people who have done that multiple times. For such a unique part of our culture, we haven't yet figured out how to have storage units make sense in our lives. I'll never stop wondering why so many people make such an expensive choice, a very costly way to postpone decisions. Think of all the other ways that money could be spent!
We're just visiting. Staying in a stranger's home is by turns convenient, titillating, creepy, funny, and surprising. I feel really naughty writing about it, but if I swear not to include any identifying details... is it too much like reading pages torn from someone's diary without knowing who it was? Ah, what the heck, I'm going in.
The first thing we noticed was that the owner mentioned the supposed property value in the Airbnb ad. Not just in the ad copy, but in the heading! Not sure how common this is, but it reminded me of the time I went on a blind date with a (short) guy who mentioned his height three separate times in his ad. I thought it was funny to care so much about how tall you are, since I'm not tall either, and it's even funnier to care about the street value of a house you aren't planning to sell. I thought it was so funny that I looked up the property tax records online and saw that they were overstating the case by about ten percent, just like the short guy.
While I was snooping around in the public records database, I looked at the square footage and the number of rooms. Well over three thousand square feet. Also FIVE TIMES LARGER than the apartment we're moving into! The number of bedrooms was a bit of a mystery. I was guessing six, but apparently it's four. That doesn't count the parlor with the curtain that has been converted into an extra bedroom.
Almost every square inch of this house is covered with decorations or objects of some kind. There were seven pillows on our bed. The dresser in our room has: a large picture in a frame; a large mirror; a fake plant in a pot with a ribbon on it; a coffee pot; a word sculpture. Every single piece of fabric in the house has a pattern on it, no two alike. The wastebasket in the bathroom still has a sticker on the front that says GENUINE MARBLE. On a trash can!
The kitchen is so full of high-end groceries, appliances, and decorations that it's almost unusable. There are at least three separate coffee contraptions. One of them has a sticky note saying not to use it because it's broken. ...? It's one of the biggest kitchens I've ever seen, with the most pantry cupboards, and yet the counters are covered with food, and there's more tucked into the bookshelves. One such item is a gallon can of tomatoes.
I can smell clutter. I mean that I can physically smell it. This home is magnificently abundant, although on the absolute opposite end of the style spectrum from my own minimalist tastes. It's rococo, it's baroque, it's shabby chic, it's Victorian, it's country cute, it somehow manages to be all of those things at once. Mirrors and marble and beads and velvet and gilt and plastic fruit and brass and tassels extraordinaire! It would be possible to separate out at least three distinct style statements and decorate at least three large homes with them, and in fact that would make a great show on HGTV. Much of a muchness of a multifarious many. Is it clutter, is it just bounteous overflow? That's a matter of purely personal taste. What I was seeing wasn't what I was smelling, though. Where was it?
As a side note, the clutter smell is to be distinguished from the wide variety of odors that come with squalor. I have worked in squalid homes that contained virtually no physical possessions. That's more common than one would guess. This house falls in a different sector of the Venn diagram, the house that is full of stuff but is physically clean. I bumped into the maid in the hallway. If there was a real hoard here, it wasn't visible from public areas.
My husband spotted it. He's almost a foot taller than me (sorry, Blind Date Guy) and we notice different things. The three-car garage has clear glass windows. He glanced that way as we were walking down the driveway, and he gasped. Later, he told me that it was completely hoarded. Well, it's a garage, what do you expect? Just because someone has a three-car garage does not mean that one or two garages' worth of space will be kept clear for cars. Why not keep your high-end luxury automobiles in the driveway and use the garage space to store heaps of stuff?
There is some sadness here. We've been around nearly a week, keeping to ourselves because we've been spending our days hauling heavy objects and resolving the myriad administrative details of moving house. All we want to do is sleep. What we've noticed is that there are, we think, eight people including us under the roof. All the doors are constantly closed. Nobody seems to be eating meals together; tonight we made dinner in the microwave and there was a lonely plate of food sitting out on the counter, waiting for someone. It's really hard to tell, but in addition to the two Airbnb rooms there seems to be at least one full-time extra tenant living here. Possibly there are adult siblings. For such a large house, a house with two living rooms, a formal dining room, and a seventy-inch TV, nobody is spending time with anyone else. It suggests the possibility that the rooms are being rented out like a boarding house, to help make ends meet.
The obvious question to me is: why not simply downsize to something affordable? Something happier? Something easier to maintain?
Granted, not everyone can bear to live in a small space. Our new apartment, the one whose keys we await in a few days, is almost exactly the same size as the three-car garage at this very maximalist house. It's funny to think that this house is still more than twice as big as the three bedroom, two bath house my husband and I lived in as newlyweds. We thought that place was cavernously large and that we had packed it full of as much stuff as possible! De gustibus non est disputandum.
We are very lucky to have the option to rent this room, the room in the very maximalist house. The linens smell fresh. Nobody interferes with us in any way. The neighborhood is so quiet at night that you can hear a leaf falling on the lawn. We've never been able to offer anything like this to our Couchsurfing guests; a foam pad crammed next to our desks and a bunch of racket from our pets is what you get at our house. Where there's plenty, there's always plenty more. While I won't be adopting these interior design strategies in our new place, we'll remember staying here with fondness and a certain amount of humor.
Money and no home is an awful lot easier than a home and no money. We're officially nomads right now, which is the technical term for when you have no fixed address but you do have an income, plenty of money, great credit, health insurance, renters insurance, and a strong social network. Without all of those underpinnings of privilege, we're...well, we're homeless. No home and no car. We don't even know what city we'll be living in next month.
Society doesn't really know what to do with a pair of university-educated, middle-aged people with no forwarding address. We had trouble putting a hold on our mail. We had trouble renting a storage unit. We had trouble arranging to return our internet equipment. I had trouble getting a check from one of my side gigs. Everything is done through computer forms with required fields these days. This will be totally different a decade from now, as more and more people enter the distributed workforce. It's already started. Young professionals will insist on working remotely, setting their own schedules, being evaluated primarily by their output and results rather than Butt-In-Chair Time, and changing locations on a whim.
Why own a car or a house if you don't want to and don't need to?
My husband and I decided seven years ago that we wouldn't bother trying to own a house until we retire, if then. We're open to the possibility of coming into a windfall and using it to buy a rental property, but it's not Plan A. Home ownership is like gambling in a casino, except that with real estate the bank, rather than the house, always wins. The first five years of mortgage payments are almost entirely interest. Our bet that we wouldn't stay in one city for a minimum of five years has proven to be prescient. The further we go down this road, the more assured we are of our combined ability to predict trends. We've preserved our ability to cut strings and relocate to better career opportunities, and it's paid off.
When we left the dealership where we sold back our car last week, my husband clearly had a moment of panic. It doesn't bother me; I didn't even learn to drive until I was 29 and I only owned a car for three years. I loathe driving. I made an offhand comment that he later told me struck him as profound. "We do this on vacation all the time." It's true. We never rent a car on vacation because we're either backpacking, in a major urban area, or in an historic area of archaeological interest. Finding our way around on mass transit or chatting with cab drivers are things we pay good money to do with our leisure time. That statement made everything click into place for him, and now he's digging it. It stimulates our sense of adventure.
Right now we're staying in an Airbnb in an affluent neighborhood. It's much nicer than where we were living before. The houses here have whimsical features like balconies, stained glass, decorative ironwork, three-car garages, and actual turrets. The week is costing us the equivalent of a week's rent in the house we just vacated, minus utilities, plus we don't have to do any chores. This is where privilege confers the magical feeling of vacation on our spurious, temporary case of homelessness.
Let's pause a moment while I turn off the flippancy and talk about real homelessness. I have worked at a homeless shelter and for an affiliated transitional housing program, as well as a drug rehab center. I'm familiar with the incredible complexity of the homelessness epidemic, and if I had to pick one social issue I was allowed to care about, this is the one. My husband and I live in a region that has 40,000 homeless people, which is about 1/3 greater than the population of the city where I grew up. There is nothing funny about it. While most people who live on the streets are back in some kind of housing within 3-4 months, those who remain are stuck in a rigged game. Many have jobs and can't earn enough to get back into lodging. The longer you're out sleeping rough, the harder it is to look presentable and the harder it is to compete in the job market. I get so upset about this issue that I sometimes find that my hands are shaking and I am squirting rage tears.
Not having somewhere to live could be a mildly interesting challenge, or a fun vacation, or a temporary logistical hiccup. It could be, it could be. It could be if we had the societal will. We throw away 40% of our food production and we have nearly 33 MILLION storage units, every single one of which is big enough for a live human being to sleep under a roof at night. We simply choose to value hyperconsumerism over human lives. When I think of all the dumpsters full of edible food and all the billions of boxes of worthless junk tucked away in climate-controlled environments, while veterans, the elderly, and mentally ill people sleep on sidewalks, it boggles my mind. I can't understand it at all. One is too many.
Ahem. Sorry about that. Back to our regularly scheduled possibility thinking, abundance, optimism, and minimalism.
So, yeah. My husband and I found the keys to our temporary home in an envelope in the mailbox. The hostess wasn't even home; she just wrote us a note and let us in. Full access. For all she knew, we could be axe murderers or meth dealers. We've never used Airbnb before and have no references or reputation points yet. The payment cleared and my profile photo didn't have horns or facial tattoos, though, so here we are. Trusted and welcomed. Money and no home is a mere blip in the system for us, nothing more than an anecdote. We're the lucky ones.
Every time I have a yard sale, I swear I'll never do it again. It tends to take about five years to forget how dumb I think yard sales are, and then I hold another one and remember. I'm in the middle of one right now, so I'll share how it's been going. I have plenty of time, because only one person has come in the last hour and a half.
We've made $109 in three and a half hours so far. That works out to $31.14 an hour.* Divide that by two people, why don't you? This has been the first really beautiful sunny spring weekend of the year, and we could be walking our dog at the duck pond, but instead we're both hanging out in the driveway trying to sell our old junk.
I put up ads on Craigslist and Nextdoor, plus a couple of big neon poster board signs on the corners near our house. The ads listed roughly the categories of stuff we were selling: tools, housewares, kitchen stuff, games, fabric and crafts. I clearly wrote '10-5' on the signs and put 'please, no early birds' in my ads. This means that people started coming only a little over an hour early instead of 7 AM. By 10:00 there were about eight people lined up at our gate waiting.
What this means for you is that you should have price tags on every single item before going to bed the night before your sale. We started setting up at 8:30 and it really wasn't enough time to haul everything out and set up tables. Plus, we were constantly being interrupted by people calling questions from the gate. (They are looking for specific things like furniture, electronic games, baby stuff, or collectibles, and if you don't have what they want, they'll leave).
Until I finally shut the garage door, every single person who came wanted to look around in the garage. This is a universal law. People will make insultingly low offers for the stuff you actually use, such as your appliances, vehicles, bikes, tools, camping equipment, and, of course, the folding tables you are using for the sale. Har de har har.
I priced almost everything at one dollar. A few larger items were marked at $2 or $3, and my husband priced out his shop tools and garden tools, mostly in the $5 and $10 range. At these prices, some people were still willing to walk away empty-handed even after showing interest. Don't expect to make more than 1970's yard sale prices for your stuff. We had three large boxes marked 'FREE' and most of that stuff is still sitting there. You can hardly give it away. When people make an offer, we say yes.
Our motivation for holding a yard sale is that we're moving. We're also (spoiler alert!) getting rid of our car later this week. We didn't want to have to pack, haul, store, and unpack extra boxes of stuff, much less buy the moving boxes for the extra stuff. Anything that anyone buys (or takes away for free) is one less item we have to arrange to discard. I got a message about a church fundraiser for a cause I support, which is building housing in the Third World, and we can drop off anything that's left over afterward. Hopefully there will only be one carload by then.
A few things on the tables right now are items that failed to sell on eBay for 99 cents.
The thing is, our stuff isn't worth anything. Neither is yours - no offense. Everyone already has four houses' worth of stuff crammed into one house already. Everyone already HAS a kitchen full of stuff they don't use, a garage full of stuff they don't use, and closets full of stuff they don't use - some of which they bought at someone else's yard sale. You almost have to pay people to take it.
Material possessions tend to be surrounded by fallacies and cognitive bias. We fall for the 'sunk cost' fallacy every time, paying higher rents to continue to store stuff we don't use because we can't bear to let it go. We think the stuff we own has appreciated but that other people's virtually identical stuff is worth only those 1970s prices. I'll sell you my old coffee mug for $12.99 but I'm not paying more than fifteen cents for yours, buddy.
The only thing that is true is that stuff is worth its usefulness to us. If we are not using it, it has zero worth. If we are paying for a storage unit, or for a room in our house that is only used to store junk, then our stuff has a NEGATIVE VALUE. When we found that we would have to pay an extra thousand dollars a month in rent to get a place with a garage in our new city, we understood that it was time to downsize. Even the garage. Even tools. Even stuff we like and use that's in great condition. We're not going to have a yard anymore, not for the foreseeable future, and storage units in our area are going for $200-$300 a month. Eff that. That's our vacation money!
We're in a 728-square-foot house already, one that came with a garage and a laundry room. We'll most likely wind up in a little condo or apartment. That's what it's like when you want to live near the beach. Many people would say (even if nobody is asking them) that I COULD NEVER DO THAT. We believe we can't live in a small space because we think our material possessions are actually body parts. They are organs that we need in order to biologically function. We cannot cognitively process the effort of imaging ourselves without our clutter, stuff, and junk. The reality is that we really only need a bed, a couch, a functioning kitchen, some towels, our electronics, and three weeks' worth of clothes for each season. I say 'functioning' kitchen, but most people's kitchens are not functional at all. Rate your home by whether your meal prep, laundry, housework, and financial systems are working in your life, not by how much you think your belongings are 'worth.'
Grand finale: Between 2 and 3 PM, only one person came by, and he spent $1. Not a single person came between 3 and 5. We made a total of $146 in 7 hours, for a return of $20.85 an hour, again divided by two people. Considering what we both earn per hour in the marketplace, it was sheer unadulterated lunacy for us to waste our weekend on this kind of activity. Price your free time at double the rate you earn at your job, unless of course you hate having free time.
If we had this sale to do over again, for the purpose of having fewer donations to pack into our car, we would have run it from 9 AM to noon and quit after that. We only made $37 in the three hours between 2 and 5. We could have had our sale, dropped off donations, and gone to the park for the rest of the day, or lounged around reading, or really anything other than wishing and hoping someone would come and pay us for our old junk.
We did donate a carload of stuff to the charity rummage sale, and no, not everything fit in one load. We'll take another one or two carloads over tomorrow before we get rid of our car. It's time to shift gears from 'how much could we get for this' to 'they need it more than we do.'
It took $40,000 before I finally believed that investing actually works. It was something I knew in my mind, but not something I really understood or felt to be true. As with most things, we don't understand until long after we've taken action. We have to see it to believe it.
When I started investing, I was a broke student with a quarter-time job. I was living in a dorm that was exactly nine feet across - three feet for my bed, a three-foot gap, and then three feet for my roommate's bed. I'd say I had nothing, but I had a lot less than that. I was generating a student loan debt that I am still paying off sixteen years later. I didn't own a car; I didn't even have a driver's license. Everything I owned fit into that tiny dorm room, either in the built-in closet or under my bed. I was 26, divorced, and owned no appliances, no furniture, no housewares, no tools. I didn't even own my own sheets. The only thing about investing that made any sense in my situation was that I had nothing to lose.
I never would have done it on my own, because I was still deep in scarcity mindset and investing for the future does not fit with that. I owe my start in investing to an older mentor who looked out for me. The rules changed at my job, and my job classification was suddenly required to contribute to the retirement plan. Unbeknownst to me, my mentor realized that this mandatory contribution would eat a huge chunk of my paycheck, and she negotiated a raise for me that would cover the difference. I barely knew this woman. She did for me what she would have done for herself or for her own daughter. I would love to pay this forward and know that anything I said helped one single person to start preparing for retirement.
The first time I got a retirement statement, I didn't even have a hundred dollars in my account. The next quarter, I called out, "Three figures, woo hoo!" I joked that I now had enough to retire for a full day.
Fast forward a few years. I was working at my first post-college job. I was sleeping on an air mattress in a rented room. I had two maxed-out credit cards, two student loans, a couple of personal debts, and about twelve hundred dollars in my retirement account. My net worth was about negative $25,000. The first thing I did at my job was to sign the forms for the maximum contribution to my 401(k). The second thing I did was to make a spreadsheet with one tab for my monthly expenses and another tab for my debts. Then I set about hustling.
My priority was to work as hard as I could every single day, learn as much as I could, get allies, and become indispensable. I needed a rock-solid reference and I wanted a promotion and a raise. Check, check, and check. That was my hobby, my entertainment, and my recreation. Tiny sums of money trickled into my investment account, while I went home, read library books, went to bed early, and finally paid off all my personal and consumer debts. I paid off one of the student loans six years early. No concerts, no alcohol, no coffee, no hair coloring, no tattoos, no piercings. I was too busy sawing the shackle of debt off my ankle.
I'm ascetic by nature. I will routinely go a month without spending on myself, just to keep my self-discipline up and running. I've never had a professional manicure or pedicure. Saving money is no big deal. Investing, on the other hand, was never a part of my world. I didn't know anyone who did it. I associated it with stockbrokers in 1929 jumping out of their office windows. I thought it was exactly like going to a casino. I had developed the habit, though, of reading personal finance books, and they always discussed investing. I went on to read several investment books. I saw that these wealthy, famous investors had different philosophies and that they sometimes gave completely contrary advice. Above my pay grade, I thought. Better stick to what I know.
There was this 401(k) money, though. In my mind, I was forcing myself to save part of my paycheck in a way that would keep me away from it. I really, really wanted to get out from under my debt load. I hated owing personal debts, and I hated having this student loan that was more than my annual salary, and I hated credit card debt most of all. It made me break out in hives just thinking about it. I mean, actual literal physical hives. If I hadn't put the 401(k) money aside, it would have vanished down the drain of debt. As soon as I was debt-free, I would have relaxed and spent it on lifestyle upgrades like moving to a safer neighborhood.
I didn't really believe that the pre-tax money going into that 401(k) account meant anything. There sure wasn't much in there. I'm a serious student, though. I had read so, so much about how investing works. I scoffed at it, I thought that almost everyone got duped and lost all their money, but I figured I might as well perform due diligence. I would pick some investments, move my money, and wait and see. I spent a couple of days reading prospectuses (brochures explaining what a fund does) and reviewing advice on how to allocate my money. Then I spent maybe an hour filling out forms, and I took the emotionally challenging step of sending them in.
One fine day, my $1200 had somehow magically turned into $40,000. That was the day I truly realized that investing is different from saving.
I get "advice" all the time. Financial "advisors" want to take over my accounts and plan my investments for me - for a fee... My husband offered to do the same at one point, until he realized that I seem to know what I'm doing and started buying some of the same stocks that I do. Various acquaintances have tried to explain that my investment strategy is "how people go bankrupt." Um, I'm not buying futures! Show me your portfolio and then I'll be happy to sit through your advice.
To tell the truth, I'm really not very good at math. I can't even calculate a tip unless I have total silence. Investing isn't about math skills; it's about trend analysis. I only buy when I understand how the company makes its money and what its future plans are. I read a lot of business news, biographies and memoirs, and various business books. I find them entertaining, so sue me. I don't take other people's advice on investing because I understand how other people make their decisions. There are few things that make me smile quite as sincerely as when I look at my accounts and see that I've doubled my money on a pick that someone tried to talk me out of.
A correction will come soon. In fact, I'll bet you a shiny new nickel that a major crash will also come at least once in the next 25 years. Possibly three or four crashes. My accounts will decrease, and all my little dead presidents will have tiny copper and zinc tears trickling down their noses. Well, I assume so. During the last crash I made a quarter of a percent. I know that the performance of the market is stochastic, meaning that there are no predictable trends or patterns. I know better than to think that my rows of green ink are enough for me to relax and stop fussing over Future Me. What I also know is that I have a better understanding of how investing works than at least eighty percent of the adult population. My experience has convinced me that if I study hard and work hard, I can learn everything I need to know. That has been great for my self-confidence. My personal power bubble is much larger than it used to be.
The major difference between me and the average person is that I think about Future Self every single day. I *am* the Future Me that Past Self 2001 was thinking about when she moved into that tiny dorm. Past Me was willing to deprive herself so she could take care of me, knowing that she would be me one day. I carry that torch. I know that Future Me 2050 is going to need all the help I can give her. She would want me to keep learning and challenging myself, and she most especially would rather I eat the ramen than force her to. You're welcome, Future Self.
Seven in ten Americans don't have a thousands dollars in savings. I keep seeing this figure in various personal finance articles. The way the poll was structured, it makes it hard to tell: did all of these people seriously not have $1000 to their name, or did they just not keep it specifically in a savings account? Either way, it's a question that is definitely worth exploring.
$1000 sounds like a fortune when you're broke and in debt. In an era when prices are what they are, it's actually attainable in a fairly short time period. A time will come when you will keep an extra $1000 in the bottom of your checking account and almost never give it a second thought.
$1000 is important because there is always going to be an "emergency" need for quick cash, and almost all people are going to go $1000 into debt by putting those expenses on their credit cards instead. That means you're paying interest on top of that grand, and over time, it will cost you significantly more.
Money isn't the money you think it is. Meaning, it hits you in several ways.
Your real hourly income. Take what you earn after taxes and other deductions. Then remove anything you spend purely because of that job, such as gas for your commute, bridge tolls, or clothing you wouldn't wear as a retiree. Like, you know, pants. Then divide by the true number of hours dedicated to your job, including your commute and breaks. The first time I did this, my real hourly wage was like $3.75. When you spend a dollar, you're spending a certain amount of life energy, as detailed in the book Your Money or Your Life.
Sales tax. Whatever you bought costs slightly more than you thought, especially if you pay for a disposable shopping bag.
Interest, fines, and fees. Add in the interest on your credit card, any late charges, foreign transaction fees, etc.
The price of your time spent shopping or handling transactions like booking tickets.
Price per square foot of the place you are storing stuff, whether your home or a storage unit.
Cost of fuel or shipping to transport items. Include parking fees and your trash bill for all that packaging.
To summarize, we carry a lot of maintenance expenses for both earning and spending money, and we don't generally connect them to the personal infrastructure of our working or shopping behaviors.
Okay, back to the $1000, a figure I will be repeating over and over again until it becomes a subliminal fixation in your mind.
$1000 can be carved out of daily expenses over a short timeframe, almost instantaneously for some people. Some methods are simple, others are radical and dramatic. $1000 can also be gained by selling items, or earned through a combination of side hustles or a job upgrade. Diving the amount into smaller chunks could mean we're trying to cut $300 from our expenses, sell $300 worth of stuff we don't need as much as we need emergency savings, $300 in income from side gigs, and that leaves just $100 we could try to get from a raise, bonus, promotion, or new and improved day job.
If you are serious about getting your finances in order and you have a storage unit or cable TV, your problem is solved. Get rid of them. That $1000 emergency savings buffer will magically appear within a few months. Ah, but I know nobody engages in that kind of tomfoolery but me. Why other people choose to spend their vacation money on television and a room of stuff they never use is beyond me, but hey. To each his own.
As an alternative, it's also pretty straightforward to cut $300 in utility bills, food, liquor, dining out, beauty treatments, and entertainment for most people. It turns out that people in every quintile of income distribution spend the same percentage of their income on entertainment! (If you're already so broke that you never spend extra money on those things, focus on getting training for a better job. You have internet access or you wouldn't be reading this, so your situation isn't hopeless). You might not be able to cut $300 in one month, but surely you can do it in six.
How do you come up with $300 from selling your stuff? It depends on what you have. Sometimes it can be done in one shot, by selling a game system or a redundant piece of electronics or a large piece of furniture. Many people who are renting a storage unit can get it by selling off everything in the unit, which is a double whammy because it also eliminates that expense. Used books and (possibly) textbooks. Collectibles. Musical instruments that aren't getting played. Fashionable clothes and accessories can go to a consignment shop. Items with the tags still on can sometimes still be returned. Coin jars can be cashed in, and so can gift cards. A lot of our consumer debt tends to come from buying stuff we couldn't really afford, which then fills up our homes. We can reverse this tide by selling some of it off and using the proceeds to build financial security.
How do you earn $300 in side hustles? Get thirty people to pay you ten bucks. Or get ten people to pay you thirty bucks. Or, get one person to pay you $300 or more. It depends on what you know how to do and how useful you are. I used to charge $10 to clean a bathroom when I was a college student, and if I needed ten bucks that bad, I always found a taker. If you have virtually no skills, you can still convince people to pay you small amounts of money for menial tasks like clearing junk or dog poop out of their yard or pet-sitting over the weekend. Once you make yourself available for odd jobs, word will get out, and people will sometimes approach you with offers you wouldn't have thought of. You don't have to do it forever; the goal is just to build up that $1000 savings cushion.
How do you round out that $1000 by earning an extra $100 at your day job? Even a ten-cent raise will achieve this over time. Honestly, though, if you're broke, it's time to think about a real career. What could you put up with doing for several years that would pay considerably better than what you earn now? After I graduated from college, I earned double the money doing what I considered the same type of work. The degree paid for itself in the first year. The more I've been paid, the easier the work has been and the less hard I have felt I had to work. We tend to talk ourselves out of the best ideas, having long lists of reasons why certain things won't work for us. All we need is one thing that WILL work and one reason TO do it.
A sneaky way to get that $1000 in savings together is to avoid ways of generating emergency expenses. For instance, don't get a speeding ticket or a DUI. Don't procrastinate on dental care. Don't put off repairs, especially car repairs or plumbing problems. A lot of crisis situations are the aftereffects of minor annoyances that were left to fester. This tends to happen when we're broke and feeling like we "can't afford" maintenance expenses. We never have time to do it right the first time, and we never have the money either.
Those of us known as "savers" may or may not have $1000 in a "savings account." We may keep it in checking. We may have it in a fireproof safe in the office. We may keep it in a money market account. We may be generating so much passive income from rentals, dividends, royalties, etc that we wouldn't bat an eye over a sudden $1000 expense. We may have many times that amount in our portfolios or retirement accounts. Sadly, though, the majority of us probably don't even realize that most of those savings vehicles exist. Broke we may be, but when we keep telling ourselves the story of broke-ness, it's hard to break free and stop being broke. An extra $1000 is a great place to start.
This story might sound familiar. A broken-hearted Australian man puts his entire life up for sale on eBay. Do you remember? I saw it in the news when it was going on. What an amazing idea! I knew as soon as I saw it that I had to read A Life Sold: What Ever Happened to That Guy Who Sold His Whole Life... on eBay?. Spoiler alert: Ian Usher went out and did what most of us don't even dare to dream, which was to make a "bucket list" and then go out and try to accomplish all his goals.
One of the most interesting things about this book is that Usher shares the whole picture, not just the cute-selfie parts. He can't stop thinking about his ex. He's sad and lonely sometimes, even as he makes tons of new friends. Some of his goals don't work out. He gets lost, swindled, injured, stuck in bad weather, and disappointed in various ways. Somehow, it all serves to make his achievements more remarkable. Almost everything that can go wrong does go wrong, and yet, he still pulls off some truly amazing goals. At the outset, he's in his mid-forties, and it is instructive to compare his plans with other people we might know in that age group.
It's also very interesting that Usher made the money to fund his travels and outrageous goals by working a dangerous, physically demanding job with specialized training, selling his house, and spending years saving money at an unusually high rate. Three out of three of those actions are actions that average people are not willing to take.
What I can't stop thinking about is the highly personal nature of the 100 goals. I read through the list, and I had done ten of them myself, including riding on a dog sled. Pretty good goals! But most of the others I would not be brave enough to do. It's a very Australian list, full of derring-do and physical challenges. This makes the book rather special. It's impossible not to start wondering what 100 items you would put on your own list, while clearly seeing that someone else's list is too idiosyncratic and personal to just... copy. It also raises questions of why certain goals that might seem obvious to someone else weren't on Usher's list. Why go to six continents when you could also go to Antarctica, for instance? Why isn't that goal on the list? Well, because it just wasn't, that's why. We're all fully entitled to have our own crazy quests and wild dreams.
A lesson from the book is that goals aren't fun when they feel like checking something off a list. They must be personally meaningful, or what's the point? The magic comes with the feeling that "I can't believe I'm finally getting a chance to do this!" The world could certainly use more of this. What would happen if more people realized that the only things holding them back from living their wildest dreams were their personal possessions and uninspiring jobs?
I just sold my elliptical. Man, I loved that thing. I tried out at least half a dozen different models before settling on it, the one with the stride that felt most natural to me. I put more miles on it than I have on some of my shoes! It was hard to say goodbye, but I made the decision. It had to go.
BUT IT'S WORTH SOMETHING!
Stuff is worth its use to us. If it's not being used, it has no value. In many cases, it has LESS than no value. Most stuff costs us money, time, and convenience to keep. It gets in the way, gathers dust, and ties us down in ways we don't even realize. I've moved so many times that I see physical possessions as a liability. The elliptical I loved so much is something I really shouldn't have bought at all. I knew that going in, so I already had an exit strategy before I went shopping.
Exit strategy - how you're going to get out of a situation, whether it's a job, neighborhood, relationship, or anything that won't last forever, whether that's good, bad, or neutral.
Why did I buy a 300-pound piece of exercise equipment?
I knew with absolute certitude that I would use it. I have a long track record of self-discipline with working out. In fact, sometimes self-discipline means I don't allow myself to work out, because I'm tapering or nursing an injury.
Compared to a monthly gym membership, the cost would eventually be fully amortized.
I bought it used, and it cost significantly less than a new model.
I had the space for it, in our oddly shaped, disproportionately large living room. It would also fit easily through the sliding glass back door. (But then we moved, and it would only fit in the garage).
I lost 25 pounds on that elliptical. I did part of my marathon training on it. There were a lot of late nights when I used it out in the garage, rather than make my husband nervous by running around the neighborhood.
Okay. These are reasons the item was valuable to me. It sounds like a list of compelling arguments to keep the thing. The way I look at it, this is actually a list of reasons why I derived full value from its use. I used it up, in the same way I would use up an apple or a pair of socks. The only difference is that it still retains value that can be used by someone else.
How much was losing 25 pounds worth to me? That would have been full value.
How much was running a marathon worth to me? That would have been full value.
How much was it worth to me not to pay a gym membership for three years? More than the cost.
According to my calculations, I've gotten more than triple the sticker price out of this machine.
More importantly, though, I consider the cost of ownership. There are several reasons why it would now cost me money to keep.
It's obsolete. The model has been discontinued. It's huge and bulky and heavy and it lacks many of the features of new models. New models do more for a lower price. Thus, if I waited another couple of years, I might never be able to find a buyer.
It might have cost me money to dispose of it. Not only might we have had to pay a dump fee, we would have had to rent a vehicle big enough to haul it off, or pay someone else to do it.
If we kept it and took it with us to our new place the next time we moved, we would either have to rent a bigger van just to make room for the elliptical, or make two trips. It was bigger than a couch.
Moving it had elements of risk. Either we moved it ourselves and risked an injury, or we would have had to pay someone else to risk the injuries. That would be sad and awful and also a legal liability.
Our new place wouldn't have enough room to keep it. It would be really, really dumb to rent a bigger place specifically to accommodate a depreciating asset. How many thousands of dollars would that be?
The default answer when most people consider getting rid of something involves cognitive bias. We value our own stuff much more highly than we would value the same item if it belonged to someone else. We also tend to drive away opportunities because we refuse to let go unless our mental price is met, even if that price has no basis in reality. This is how we get stuck. We stay rooted in one spot, missing out on who knows how many opportunities, until we finally decide we're ready to let go, and then find that we missed the peak sales window. Our treasures have turned into old junk.
Eventually you can't even give it away.
I used to have an elliptical. I had some great times on it, and it's a good memory. But my life changed, and it was time to let it go. It would have cost me so much to keep it that I would have paid someone to take it away. I got so much value out of it that I could have given it away for free. It would have been expensive to keep, but I managed to sell it! The purchaser rented a van to haul it away, and for that plus the bidding price, he could have bought a new model. I believe I sold my used old elliptical for as much as the market would bear.
Two of the most expensive mistakes you can make are made by the majority of people every single day. One is to pay a higher mortgage or rent because you have so much stuff that you need extra rooms. Calculate the price per square foot of your place and then ask yourself why you're in debt and can't afford to go on vacation. The second, and far more expensive mistake, is to stay nailed down in one area when you could have a more interesting and better paid job by relocating. There is also the factor of a long commute time. Many people choose to live farther from their place of employment so they can have a bigger house or yard, which they can then never enjoy because they are always on the freeway. We live in a tiny house because it means my husband can walk to work. This is so awesome that we'd live in a studio apartment if we had to.
Stuff versus lifestyle. That's really what it comes down to. There is no piece of equipment so excellent that it would be worth needing a bigger house, having a longer commute, losing our geographic mobility, or eating into our travel fund. I wouldn't drag around something that big any more than I would strap a boat anchor to my back. Nothing is worth as much as our freedom and peace of mind.
I bought $20 worth of Thin Mints from some Girl Scouts. It's true. I did it, even though I was a Camp Fire Girl. Then I ate an entire box of the chocolatey minty wafer cookies in a week. I'm not ashamed! It's more than just a cookie; it's a charitable and educational event. Right?? That's why, ounce for ounce, they cost a lot more than store-bought cookies, and a mega-lot more than homemade cookies. I have to remind myself that I'm not literally eating money, I'm only metaphorically eating money.
The first time I successfully lost a bunch of weight, it was because I was flat freaking broke. I mean, so broke I had to go to the Laundromat and ask people if they could spare some lint so at least I would have something in my pocket. My major goal at that time of my life was to convert money into food as quickly as I could. The connection between the two goes a lot farther for me than the realization that so many foods are coin-shaped. (Pizzas, donuts, potato chips, burgers, most cookies, banana slices, OMG MIND BLOWN)
When I was in college, my stated goal was to get a job that paid well enough that I could eat every meal in a restaurant. I basically did that when we were on our honeymoon, and that is why this is no longer a goal for me. I can gain a full clothing size in under two weeks. I've done it at least twice. If there was a TV show about me, it would be called 'Biggest Gainer.' I can basically look at a picture menu and gain three pounds. I sometimes wish I were ten inches taller, so I could eat more, although if that actually worked I'd be a redwood tree by now. The result of my love affair with cookies and restaurant food has been a cost of thousands of dollars in fitness equipment, gym memberships, race fees, gym clothes, running shoes, and a stint with a personal trainer, not to mention the various health issues.
When we're trying to get out of debt and move toward financial stability, much less financial freedom, we can't ignore the issue of what we spend on food. There is an extremely interesting relationship between food and finance that is very reflective of our attitudes toward scarcity and abundance.
I am in a place of financial comfort now where I can afford basically any food I want, anywhere, at any time. I could pick up my phone and have a wide range of steamy goodness at my front door within twenty minutes. What has been instructive to me is that I no longer eat the vast majority of 'comfort foods' I used to love. I lost interest. I used to stand at the vending machine in my office longer than most people stand in front of the Mona Lisa when they visit the Louvre. The beautiful mystery that is food packaging! I calculated recently that I spent at least $300 a year on vending machine snacks at a time when I really could have used that money for other things, like a new winter coat. I also could have had triple the calories for the same price by buying healthier foods at the grocery store, or I could have acknowledged my habits and gotten the same snacks in bulk at Costco. At the time, I was framing this habit as a not-habit, as a one-time splurge multiplied many times, as a "treat."
A "treat" is a band-aid on a disappointing life.
My real issues were an unfulfilling job, an unsuitable relationship, a conflicted relationship with my body image and physical health, an objectionable commute, and a climate that almost never suited me. No bag of vending machine snacks or pro-social cookies was going to help with that.
Health food is expensive. Well, yes and no. I will never stop pointing out that a bunch of organic kale costs the same as a modestly-sized bag of chips from the convenience store. A five-pound bag of potatoes costs the same as a Big Mac. At least some of the cost of healthier groceries can easily be offset by changing our purchasing habits. Vending machines and convenience stores are expensive! I've been to the discount grocery store, the one where they have half-off frozen foods, and discovered that it's still significantly cheaper to buy bulk goods and cook from scratch. That process can feel like such a depressing, exhausted, onerous chore from a position of scarcity, though! Cooking in a tiny, scuzzy, outdated kitchen with dubious pot handles, dull knives, and poor lighting. Bleah. There's a reason why upscale homes always have ginormous foofoo kitchens.
When I was poor, I hated to cook. I was tired, I worked on my feet a lot, I commuted on the bus, and when I got home I was wiped out. I didn't understand the connection between my dietary habits, my energy level, and my quality of sleep. Now that I have nice pans, a vast spice cabinet, and a dishwasher, I love cooking. We can our own produce, soup stock, jam, and pickles. It's really weird that I have probably triple the energy as a middle-aged person than I did in my twenties. This is definitely linked to the optimism that comes with prosperity. I suspect this works both ways, although I can't go back in time to prove it.
It helps to reframe the way we think about treats. Is it really a treat if I feel physically icky the next day, like when I overdo it at a buffet restaurant? Is it really a treat if I've been trying to get off medication? Is it really a treat if I feel like my weight is out of control and I hate the way I look and feel? THIS IS NOT ME is not a treat kind of a feeling. Does what I've been doing lately fit with my vision of Future Me in a thriving career and a super-awesome personal environment? Are my habits leading toward greater abundance and fun, or am I trading my future for momentary pleasure? Would I feed my pets the way I feed myself?
That one tends to stop me in my tracks. I would never let my beautiful fluff-babies eat the amount of sugar that I do. If someone tried to feed my parrot a cookie, I would slap it right out of their hand. Meanwhile [crams stack of cookies in mouth].
What would a happy person do? There is this idea that impulsive decisions and living for the now are the happier choice, but only young people really believe this. Once we pass the age of thirty, we start to feel it more. Yeah, I used to love to party and stay up late, but then I got tired. Domestic contentment is an abiding form of happiness, one that is reliable. When you can be happy on an average day at home, in full acceptance of your current situation, then you've won the game. Part of this domestic happiness includes financial stability and part of it includes the elusive sensation of "loving the skin you're in." It's much easier to appreciate these feelings when you've attained them after years of not feeling either. Believe that these feelings of peace and satisfaction truly exist and that they are possible.
I was just reading an old post from Mr. Money Mustache in which he describes ironing his five-dollar bills and putting them in a photo album. Immediately I was paralyzed by a fit of laughter. I have a relative, who shall remain nameless, who also used to iron his/her dollar bills! I wondered for just a blip whether this story was true, but it has to be, because who would make that up? American currency does contain fabric content. Money, you so... crispy... Oh dear. I am undone. Let me see if I can write this without guffawing again. Can you be here with me? Can you be in a space where thinking about money gives you feelings of amusement and delight?
The great thing about money is that it's a symbol, whereas our problems are so darn specific. Here I have some money. What can I do with it? Can I use it to solve a plumbing problem? Yes. Can I use it to get some dinner? Yes. Can I use it to send a present to my friend? Yes. Can I use it to get help when I am stranded at the side of the road? Yes. Can I give it to charity? Yes! Whereas, all of these problems are more complicated without money. If you don't have money, you'd better have skills, and if you don't have skills OR money, you'd better be a pretty darn top-notch friend or be really good at wheedling. If you have a problem, and you don't have money and you don't know how to solve it yourself, then you probably still have the problem. Contrariwise, if you have skills and friends and you can do things by yourself, then you can keep your money, and you'll probably wind up with both more skills and more friends.
It's much more fun to be the SOLVER of other people's problems than to be the CAUSE of other people's problems, always needing them to bail you out.
You know what's fun? Anonymously sending money to your hard-up friend is fun. You know what else is fun? Sneaking over to the till in a restaurant and picking up someone else's check. Another fun and sneaky trick is to see someone who looks broke, go up behind them, and pretend to pick up money that "fell out of their pocket." "Excuse me, sir, I think you dropped this?" There are few facial expressions more full of surprise than the one when someone receives a surprise $20 bill. I stuck a twenty in a bag once for a homeless kid who asked me to buy him some cheese and crackers. He looked in the bag and did a triple take when he saw the money. Tee hee hee!
These are some uses of cash that are harder to do with digital transactions. If you slip some currency into someone's house surreptitiously, you have plausible deniability and no paper trail. They can't prove it was you. It's like reverse stealing. This is the kind of fun you can have when you know you have plenty for yourself and that you can always get more.
What does all this have to do with ironing your money? It depends on how you feel about ironing. My brother and I used to bicker over it when we were kids. We both enjoyed ironing, and when one of us would get the ironing board out, we would try to get the other to hand over whatever it was they were planning to press. "I'll do it for you." "No, no, that's okay." No, I insist! There is just something so satisfying about a freshly pressed shirt. I draw the line there; I wasn't the one who ironed my jeans, just saying! Ironing says intention. I planned it this way. I found every little wrinkle and smoothed it out. I took care over this job. I'm proud of what I have, whether that's my pants or my pelf. My slacks or my greenbacks. My duds or my ducats.
My brother who loved ironing always looks sharp; sharper than me anyway. He's still in his thirties and has already met with a retirement planner. Our unnamed relative who ironed money retired early, having opened a brokerage account while working as a bagger at a grocery store. This is what happens to you when you like ironing. How you do one thing is how you do everything.
(Or it can be, once it occurs to you that you can transfer your skills and focus from one area to other areas).
(If you're not sure what a brokerage account is, keep following me. I'll get to that in a future post).
Most people treat money with at least a certain amount of vagueness. Thinking about it too closely can lead to panic. Retirement? But I'm still in debt! I can't even get to ZERO! This is what happens when we avoid and resist. We get a muddle. The harder we try to avoid and resist, the bigger the muddle. Mental clarity is a major part of solving any persistent problem. Getting a solid mental grasp on reality is the only way to improve that reality. I see this with my clients all the time. They've got coins scattered all around the house, on the bathroom counter, on their dressers and nightstands, on the kitchen counters, in shopping bags and in their boxes labeled MISC. There is cash mixed in with unpaid bills, uncashed checks are mixed in with collections notices, expired coupons are mixed in with expired gift cards. When part of your clutter is made of actual money, there's a problem.
The first step is to choose one spot to respect your money. A jar? A shoebox? A fireproof safe? A big envelope? Gather all the coins and currency and checks and gift cards into one space as you turn them up. Go through your wallet and stack up all your bills so they are facing the same direction. Smallest denominations on top. That's how we do it in the cash register. The reason is that it makes it easier to tell how much you have at a glance. Eventually, you'll have a rough idea of your financial standing at all times, without having to check or give it much thought.
Peace of mind doesn't happen by itself. A cloud of vagueness and a faint intention to maybe think about something a few decades from now is not the same thing as peace of mind! Financial problems are completely incompatible with peace of mind. It means there's something wrong, an imbalance of energy exchange with the world. Financial problems also generally stop being your problem and drag in other people, turning your problems into their problems. Clarity with money can quickly turn into an action plan, and action plans can quickly turn into cash. Currency has magical powers. It can buy peace of mind for yourself and it can also buy peace of mind for others. Ironing your money may seem like a silly thing to do, but anecdotally, it's better to have your money under pressure than to feel pressured by money!
I've been working with chronic disorganization, squalor, and hoarding for over 20 years. I'm also a marathon runner who was diagnosed with fibromyalgia and thyroid disease 17 years ago.