In this Issue:
The Second Biggest “Holiday”
The start of a new school year may not seem like a holiday to school kids, but for retailers the back-to-school shopping season, now in full swing, is the second biggest "holiday" of the year -- second only to Christmas. According to the National Retail Federation, the average family with school-age children will spend nearly $530 this year on school supplies, school-related electronics, and clothing.
Matt's View
Most of the back-to-school shopping advice articles now filling the personal finance pages of newspapers and magazines offer up the usual ideas: shop around, compare online prices with offline prices, and, while it's too late for this year, get the list of items your children's schools will require before the summer break begins and then be on the lookout for summer sales. One story recommended leaving the kids at home while doing your back-to-school shopping. I couldn't disagree more. Back-to-school shopping offers a great opportunity to teach kids money management lessons such as budgeting (how to make and, yes, stick to a budget), comparison-shopping, and making tradeoffs (Let's see, do I buy a trendy new messenger bag or keep using last year's backpack and buy three pair of pants and a new pair of shoes instead?).
Majoring in Debt
An MSNBC article on 8/11 highlighted the trouble many college kids get themselves into after signing up for their first credit card at college -- namely, lots of debt. According to student loan provider Nellie Mae, the average freshman accumulates over $1,500 of credit card debt, a figure that more than doubles by their senior year. Almost half of all college students with credit cards have at least four cards.
Matt's View
When kids are away from mom and dad for the first time is not exactly the ideal time to introduce them to a piece of plastic with seemingly magical powers to make pizza arrive at their dormitory door. Better to educate kids about the proper uses of plastic while they're still at home, teaching concepts they're not likely to stumble upon on their own such as using credit cards only for pre-planned, budgeted purchases and always paying the balance in full. Even better is to give them real-world, supervised experience with a secured card.
Scammers Show the Way to Savings
When Sid Kirchheimer decided to write about smarter spending, he turned to an unusual source: "reformed scammers." The resulting book, Scam Proof Your Life, includes money-saving insights from an assortment of former con artists and other schemers. It also includes honest insiders' tips on how to get better deals on everything from homes to healthcare. Some of the advice may be obvious (delete all e-mail from people claiming to be former members of some royal family), but much of it is not. In one example, mentioned in an 8/6 Chicago Tribune review, Kirchheimer warns car shoppers not to hand over your license before negotiating the car's price. Some salespeople will ask for it, send you on a solo test drive, run an illegal credit check while you're away, and then use information about your finances against you in the negotiation.
Matt's View
With scams seeming to lurk behind every dinnertime phone call or unexpected knock at the door, reformed scammers are an unfortunately excellent source of ideas for safer spending and smarter living. As writer of the "Scam Alert" column in The AARP Bulletin, Kirchheimer is a trusted authority on scams, those who run them, and those who are truly reformed.
Millionaire Madness
While a million bucks certainly doesn't buy what it used to, an 8/15 USA Today story said it remains the monetary benchmark of having "truly made it." As a result, millionaire madness continues to permeate our culture. Game shows with million dollar prizes are among the biggest hits, books offering to teach us the "Secrets of the Millionaire Mind" and how become an "Automatic Millionaire" sell like crazy, multi-million dollar lottery prizes capture news headlines, seminars claiming that "One Weekend Can Make You a Millionaire" pack in attendees, and on it goes.
Matt's View
The one millionaire-oriented book I recommend is The Millionaire Next Door. For every Oprah or Paris whose jet-set lifestyle adorns the covers of checkout line magazines, the book proves that most wealthy people have neither unusual names nor unusually lavish lifestyles. The book details the habits of those who excel at building wealth and it turns out that they're surprisingly accessible to all: using a household budget, living well beneath their means, and, largely because of their frugality, setting aside a sizeable portion of their income for saving and investing. However, current statistics on personal savings and debt would seem to suggest that such habits have not exactly captured the public imagination. Perhaps it would help if the best (or most beautiful?) budgeters could make the cover of People magazine. Maybe Quicken needs a celebrity endorser.
Quicken Basic
One of the most surprising findings in the book The Millionaire Next Door is the fact that over half of all millionaires use a household budget to guide their spending. That's right, the lowly budget--what I call the Rodney Dangerfield...
Recommended Resources
- Amazon for Groceries
- Have you ever shopped for groceries on Amazon? There are deals to be had. For example, if you buy $49 worth of Kashi products during July you can get an instant $20 rebate. Their Cinnamon Harvest cereal, shown here, comes...…Read the rest
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“Matt Bell speaks from the convictions of his own life experiences. He exposes the lies that our culture tries to tell us about ourselves. And he lovingly tells God’s truth about the necessity for us to be stewards of God’s resources. Our adult Sunday school class loved Matt and were challenged to grow through his class.”