Money. Purpose. Joy.

In this Issue:

• When Filling Up Taps You Out
• Lessons Learned on a Spending Sabbatical
• The Piggy Bank Balance Transfer
• Is That Five-Dollar Tomato Worth It?

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When Filling Up Taps You Out

With fuel prices at record highs, filling the gas tank is starting to feel more like an investment than an expense. For some ideas on how to save on gas, a 7/26 posting on Businessweek Online said the most important steps are all pretty simple: keep our tires properly inflated, accelerate and brake gently, slow down, and combine errands. More tips can be found at the Department of Energy's web site .

A couple of articles on Yahoo! Finance offered somewhat more involved ideas such as carpooling and vanpooling . Another idea that’s growing in popularity is auto sharing , essentially renting a car by the hour.

As for the many devices and additives that claim to improve a car’s gas mileage, an ABC News online story posted on 7/13 said EPA testing found that none of them work. Instead try using your car’s air conditioner less often. While some believe the added drag of driving with open windows negates the savings, the article said that’s a myth.

Matt’s View

Perhaps the most radical idea is the one offered by Freegashelp.com . Qualified drivers in a limited but growing number of markets get about $30 a month in free gas in exchange for attaching magnetized advertisements to their vehicle. It’s not quite selling your soul for a tank of gas, but since many people see their car as an extension of themselves, it’s close.

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Lessons Learned on a Spending Sabbatical

Many people complain about the “consumer treadmill,” but few are willing to actually step off. An article on MSN recently profiled someone who did. Judith Levine spent a year buying only essentials—no movies, no restaurant meals, no ice cream. While her spending sabbatical enabled her to pay off nearly $8,000 in credit card debt, she also found more meaning in a life of less spending. “You not only learn what you can live without, but what you really want to spend your money on.” Today she devotes more of her time and money to causes she believes in.

Matt’s View

Levine also had some interesting observations about the social nature of spending. She saw how getting together with friends often seems to require spending money. While some friends began to feel penalized for getting together with her (“Oh Judith, not another walk!”), she found many others were interested in managing their money more effectively and appreciated her suggestions for free entertainment, like going to museums when admission is free.

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The Piggy Bank Balance Transfer

Banks and other financial institutions are going after kids’ lemonade stand money. According to an article in the 7/29-30 issue of the Wall Street Journal, many financial service providers are offering everything from stick-on tattoos to iPods to entice kids to bank with them. And they’re offering more than just passbook savings accounts. Today, kids can get checking accounts, debit cards, online account access, and small loans. USAA even offers a kid-targeted mutual fund, First Start, that invests in the stocks of companies children are likely to recognize and can be opened with as little as $20.

Matt’s View

Giving kids access to debit cards and other financial instruments might strike fear in a parent’s heart. And we should tread carefully here. However, despite the growth of personal finance education programs in the nation’s classrooms, a recent report found them largely ineffective. So, with strong parental oversight, putting real financial tools in the hands of children may help teach lessons that stick.

One caveat is to make sure the tools are age appropriate. A good source of information about what financial concepts kids can understand at what age is offered by the National Endowment for Financial Education (Click on “Simple Steps to Raising a Money Smart Child”). By far, the most important key is for parents to demonstrate wise money management practices themselves. With the average household saving very little and carrying heavy consumer debt loads, that may be the biggest challenge to raising money-smart kids.

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Is That Five-Dollar Tomato Worth It?

Organic products, once limited to specialty food stores, have become mainstream. With so many products now labeled as organic, and especially because of their higher prices, it’s important to know which ones are worth the extra cost. A New York Times article on 7/29 cited a Consumer Reports study (pdf) that helps shoppers make informed choices. The study recommends taking a pass on organic seafood, for example, which may be no freer of mercury or PCB’s than non-organic seafood. For guidance on which seafood is safe, the Times article recommended a web site run by the Monterey Aquarium Foundation .

The foods where it does pay to go organic, according to Consumer Reports, include: apples, bell peppers, celery, cherries, imported grapes, nectarines, peaches, pears, potatoes, red raspberries, spinach and strawberries—all of which tend to have high pesticide residue, even after washing. Also recommended are organic meat, poultry, eggs, dairy, and baby food.

Matt’s View

Standard money-saving advice is to eat out less often. However, with two-thirds of households now buying organics, which can cost twice as much as their non-organic equivalents, eating in is becoming less of a bargain. The six-page Consumer Reports study is worth reading in its entirety. It adds clarity to a food-buying experience cluttered with misleading health claims, and keeps us from paying for benefits that, in some cases, are more perception than reality.

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